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                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                  FORM 10-KSB/A

/X/   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
      ACT OF 1934

                      For the Year Ended December 31, 1999

/ /   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934

            For the transition period from __________ to ___________.

                          COMMISSION FILE NO.: 0-25244

                              --------------------

                            TRANS WORLD GAMING CORP.
             (Exact name of registrant as specified in its charter)

                NEVADA                                          13-3738518
     (State or other jurisdiction of                        (I.R.S. Employer
     incorporation or organization)                         Identification No.)


     545 FIFTH AVENUE, SUITE 940                                  10017
           NEW YORK, NEW YORK                                   (Zip Code)
     (Address of principal executive offices)

       Registrant's telephone number, including area code: (212) 983-3355

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

                         COMMON STOCK, $.001 PAR VALUE
                       WARRANTS TO PURCHASE COMMON STOCK

                              --------------------

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

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

           / / The issuer's revenues for the year ended December 31, 1999 were
approximately $12,294,000.

           As of December 31, 1999, 5,365,449 shares of Common Stock of the
Registrant were deemed outstanding, and the aggregate market value of the
Common Stock of the Registrant as of that date (based upon the closing price
of the Common Stock at that date as reported by the OTC Bulletin Board,
excluding outstanding shares beneficially owned by directors and executive
officers, was approximately $0.51.

   Transitional Small Business Disclosure Format (check one: YES / /    NO /X/)
===============================================================================

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                                        TRANS WORLD GAMING CORP.
                                              FORM 10-KSB

                                           TABLE OF CONTENTS

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<S>      <C>      <C>                                                                                   <C>
PART I
         Item 1.  Description of Business                                                                  1
                  General Development of Business                                                          1
                  Czech Republic                                                                           1
                  Spain                                                                                    2
                  Louisiana Operations                                                                     2
                  Other Terminated Ventures                                                                4
                  Multiple Application Tracking Systems, Inc.                                              4
                  The Boxer Casino                                                                         4
                  The Bishkek Casino                                                                       4
                  OTC Bulletin Board                                                                       5
                  Accounting and Financial Issues                                                          5
                  Corporate Information                                                                    5
                  Financial Information About Industry Segments                                            5
                  Narrative Description of Business                                                        6
                  Industry Overview                                                                        6
                  The Company's Facilities                                                                 6
                  Louisiana Gaming                                                                         6
                  Woodlands Truckstop                                                                      6
                  Czech Republic                                                                           6
                  Spain                                                                                    6
                  Future Operations                                                                        7
                  Czech Republic                                                                           7
                  Spain                                                                                    7
                  Long Range Objectives                                                                    7
                  Marketing                                                                                8
                  Czech Republic                                                                           8
                  Spain                                                                                    8
                  Acquisition Agreement                                                                    8
                  Regulations and Licensing                                                                9
                  Federal Regulation                                                                       9
                  Competition                                                                              9
                  Employees                                                                               10
         Item 2.  Description of Property                                                                 10
                  Corporate Offices                                                                       10
                  Louisiana                                                                               10
                  Czech Republic                                                                          10
                  Spain                                                                                   10
         Item 3.  Legal Proceedings                                                                       10
         Item 4.  Submission of Matters to a Vote of Security Holders                                     11
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                                           TABLE OF CONTENTS

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<S>      <C>      <C>                                                                                   <C>
PART II.
         Item 5.  Market for Common Equity and Related Stockholder Matters                                12
         Item 6.  Management's Discussion and Analysis or Plan of Operations                              13
                  Forward-Looking Statements                                                              13
                  Results of Operations                                                                   13
                  Revenues                                                                                13
                  Costs of Revenues                                                                       16
                  Earnings/(Loss)                                                                         17
                  Ceska, Czech Republic                                                                   17
                  Rozvadov, Czech Republic                                                                18
                  Zaragoza, Spain                                                                         18
                  Liquidity and Capital Resources                                                         19
                  Plan of Operations                                                                      20
                  Important Factors to Consider                                                           20
                  Accumulated Deficit; Operating Losses; Going Concern                                    20
                  Termination of Louisiana Operations in 1999; Need to Diversify                          21
                  Taxation of Gaming Operations                                                           21
                  Dependence upon Key Personnel                                                           21
                  Need for Additional Financing                                                           21
                  International Activities                                                                22
                  Licensing and Regulation                                                                22
                  Liability Insurance                                                                     22
                  No Dividends                                                                            22
                  Possible Adverse Effect of Issuance of Preferred Stock                                  22
                  Dilutive Effect of Warrants                                                             23
         Item 7.  Financial Statements                                                                    23
         Item 8.  Changes In and Disagreements with Accountants on
                  Accounting and Financial Disclosure                                                     23

PART III.
         Item 9.  Directors and Executive Officers, Promoters and Control
                  Persons; Compliance with Section 16(a) of the Exchange
                  Act.                                                                                    24
                  Information about the Board and its Committees                                          25
                  Audit Committee                                                                         25
                  Executive Committee                                                                     25
                  Compensation Committee                                                                  25
                  Section 16(a) Beneficial Ownership Reporting Compliance                                 25
         Item 10. Executive Compensation                                                                  26
                  Summary of Cash and Certain Other Compensation                                          26
                  Option Grants and Exercises                                                             27
                  Directors' Compensation                                                                 27
                  Employment/Severance Agreements                                                         28
         Item 11. Security Ownership of Certain Beneficial Owners and
                  Management                                                                              28
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                                           TABLE OF CONTENTS

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<S>      <C>      <C>      <C>                                                                          <C>
         Item 12. Certain Relationships and Related Transactions                                          31
         Item 13. Exhibits and Reports on Form 8-K                                                        33
                  (a)      Exhibits                                                                       33
                  (b)      Reports on Form 8-K                                                            33
EXHIBITS INDEX                                                                                            34
SIGNATURES                                                                                                42
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS                                                                43





























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<PAGE>

ITEM 1.  DESCRIPTION OF BUSINESS.

GENERAL DEVELOPMENT OF BUSINESS

Trans World Gaming Corp. (the "Company" or "TWG") was organized as a Nevada
corporation in October 1993 to acquire, develop and manage, to the extent
permitted by applicable local laws, gaming establishments featuring live and
mechanized gaming, including video gaming devices such as video poker machines.

TWG proceeded to enter into this business through its 1994 acquisition of
several Louisiana based entities. In 1998, in response to changes in the laws
governing the legality of operating video gaming devices in the state of
Louisiana and faced with a closing date of June 30, 1999 for its Louisiana
operations as a result of this change in law, TWG amended its operating
strategy by shifting its focus to the casino market overseas and acquired five
casinos, one of which includes a hotel, and a parcel of land in Europe. The
Company has since closed two of the casinos due, as in Louisiana, to local
gaming law changes, but has recently opened an additional casino on the parcel
of land that was purchased in 1998, which leaves the Company with a total of
four casinos currently in operation.

CZECH REPUBLIC

On March 31, 1998, the Company consummated a Stock Purchase Agreement ("Stock
Purchase Agreement") with 21st Century Resorts a.s., an owner-operator of two
casinos, and the owner of property to build a third casino, in the Czech
Republic ("Resorts"), Gameway Leasing Limited ("Gameway") and Monarch Leasing
Limited ("Monarch Leasing"), two off-shore affiliates of Resorts which leased
equipment to Resorts and the stockholders of Resorts (the "Selling
Stockholders") pursuant to which the Company acquired 100% of the equity
interests of Resorts and its two operating subsidiaries and all of the assets
of Gameway and Monarch Leasing. On March 31, 1998, the Company, with the
assistance of Libra Investments, Inc., Los Angeles, California ("Libra")
acting as placement agent, borrowed $17.0 million from fourteen sophisticated,
accredited investors (the "Investors") in a private placement (the "Private
Placement"). The loan is represented by 12% Senior Secured Notes (the "Senior
Notes") issued pursuant to indentures (the "Indentures") by and among TWG, TWG
International U.S. Corporation ("TWGI"), TWG Finance Corp. ("TFC") (TWGI and
TFC) are wholly-owned subsidiaries of TWG) and U.S. Trust Company of Texas,
N.A., Dallas, Texas ("USTCT") acting as indenture trustee. The Senior Notes
require mandatory prepayments based upon excess cash flow generated by TWGI
from the operation of Resorts and bear interest at the rate of 12% per annum.
(See - Periodic Reports Form 8-K and the Amended Periodic Report on Form 8-K/A
filed with the Securities and Exchange Commission ("SEC") on April 14, 1998
and June 15, 1998, respectively.) The proceeds of the Senior Notes were used
to pay the net acquisition costs of, and improvements to, Resorts totaling
approximately $12.6 million, to repay the First Amended Loan Agreement in the
amount of $1.3 million, to cover costs and expenses of $1.4 million relating
to the Private Placement and to provide working capital of $1.7 million.

As a result of a change in Czech gaming law which effectively banned foreign
ownership of casinos, the Company restructured the ownership of Resorts
through the use of a new Czech limited liability company and amended the
indentures (the "Amended Indentures"), both of which Amended Indentures relate
to, but do not alter, the Senior Notes.

On October 15, 1999, the Company borrowed $3.0 million ($2.7 million from
Value Partners) in a private placement ("October 1999 Private Placement"). The
loan is represented by 12% Senior Secured Notes ("October 1999 Senior Notes")
issued pursuant to indentures by and among the Company and an independent
indenture trustee. The October 1999 Senior Notes, which are due March 2005,
require mandatory prepayments based on excess cash flow generated from
Resorts. The October 1999 Senior Notes are collateralized primarily by all of
Resort's gaming equipment and a majority interest in the capital stock of all
of the Company's subsidiaries (except Casino de Zaragoza, S.A. ("CDZ"), a
company

                                      1

<PAGE>

incorporated in Zaragoza, Spain). In addition to the October 1999 Senior
Notes, each investor received a proportionate share of warrants to purchase
1,250,728 shares of the Company's common stock.

The proceeds of the October 1999 Senior Notes were used to retire a $1 million
short-term debt obligation, related to the acquisition of the casino in
Zaragoza, Spain, to make an interest payment of approximately $250,000 on said
debt, and to finance the equipping, working capital, and pre-opening costs
associated with the opening of a third casino in the Czech Republic on the
land that had been previously purchased in conjunction with the issuance of
the Senior Notes on March 31, 1998. That casino, located near Snojmo, on the
border with Austria, opened on December 22, 1999.

SPAIN

On April 17, 1998, the Company acquired 90% of CDZ, which holds the exclusive
casino license in the region of Aragon. Following approval of its
recapitalization plan by the Council of Ministers in Spain and the subsequent
forfeiture of the shares of the holder of the remaining 10% ownership in the
Company, who declined to participate in the recapitalization of the Company.
TWG presently owns 99.92% of CDZ (See: Item 6. "Management's Discussion and
Analysis or Plan of Operation - Liquidity and Capital Resources"). The Company
acquired 90% of the outstanding stock of CDZ for approximately $780,000
(excluding related acquisition costs of approximately $678,000) and assumed
its outstanding debt obligations of approximately $4.9 million.

The Company intends to move the casino, which is currently located
approximately fifteen miles outside of the city of Zaragoza, to a downtown
location. An understanding had been reached with an agency of the provincial
government, the Diputacion General de Aragon ("DGA"), to allow the casino to
execute this move, subject to the issuance of a decree; however, instead of a
decree, in February 2000, the DGA introduced a law that would allow the casino
to relocate. The law is expected to be presented to local Spanish parliament
in June 2000. Management believes, based on its discussions with Spanish
authorities, the law has little opposition and is expected to pass.

LOUISIANA OPERATIONS

Although the Company's Louisiana video poker operations terminated as of June
30, 1999, references to the Company's Louisiana activities are presented here
with respect to activities which occurred through December 31, 1999 and in the
event that the appeal being undertaken by an industry group on behalf of all
similarly situated companies to the U.S. Supreme Court (discussed below)
results in the reversal of the lower court's decision.

Trans World Gaming of Louisiana, Inc. ("TWGLa"), a wholly-owned subsidiary of
TWG, owned certain ownership interests in two gaming establishments at truck
stops in Louisiana, which included (i) an establishment located at the 76
Plaza in Lafayette, Louisiana known as the "Gold Coin" (formerly known as the
Gold Nugget), which had 50 video lottery terminals ("VLTs" or "Devices"), and
(ii) the Toledo Palace (the "Toledo Palace"), which the Company established
and licensed at a truck stop located in DeRidder, Louisiana, known as the
Woodlands Travel Plaza (the "Woodlands") and at which TWGLa operated 33 VLTs.
Both the Gold Coin and the Toledo Palace establishments were licensed to
operate only VLTs. As a result of a referendum in 1996 in 35 parishes in
Louisiana, including the two parishes in which the Gold Coin and the Toledo
Palace, are located, it was determined that video poker would cease effective
June 30, 1999 (the "Voter Mandate"). In accordance with the Voter Mandate, the
Louisiana gaming authorities terminated the operations at both the Gold Coin
and the Toledo Palace on June 30, 1999. The Company has appealed the Louisiana
State Court's recent decision to uphold the Voter Mandate to the U.S. Supreme
Court. The U.S. Supreme Court will decide in 2000 whether or not to consider
the case (See Item 3. "Legal Proceedings"). The Company cannot, as of the date
hereof, predict the outcome of its litigation or when a decision relating
hereto will be rendered.

In accordance with the Voter Mandate and the outcome of subsequent judicial
decisions, the Company ceased all operations in Louisiana on June 30, 1999 and
its lease at the Gold Coin location in Lafayette was

                                      2

<PAGE>

terminated on July 31, 1999. The Company sold the Woodlands truck stop in
DeRidder on October 4, 1999 for $295,000 and sold the video poker machines for
$84,000.

In accordance with the Company's strategy to further concentrate on profitable
businesses and minimize risk, the Company is in the process of disposing of
its non-voting 49% interest in Chrysolith, LLC, a Louisiana limited liability
company ("Chrysolith"). Chrysolith provided on-site management for all of the
operations of both the Gold Coin and the Toledo Palace, including the
operation, servicing and maintenance of the VLTs, pursuant to a management
agreement, the Amended and Restated Regulations and Operating Agreement of
Chrysolith, dated December 1994 and amended December 1996 (the "Chrysolith
Operating Agreement"). Through June 30, 1999, the Company received the net
revenue at both the Gold Coin and the Toledo Palace, which is the revenue
generated by VLTs at both facilities after payment of franchise taxes by
Chrysolith to the State of Louisiana and after payment of all prizes to the
players (the "Net Win After Tax"). The Company, in conjunction with this
arrangement, further reimbursed Chrysolith for all direct operating costs
incurred in the operation of the VLTs. Although the Company does not foresee
any further business involvement in Louisiana, the Chrysolith Operating
Agreement will continue pending the decision of the U.S. Supreme Court
regarding the Company's appeal of the termination of the operations at the
Gold Coin and Toledo Palace.

On December 22, 1994, the Company acquired from Chrysolith and Prime
Properties, Inc., a Louisiana corporation ("Prime"), which leased the 76
Plaza, a truckstop in which the Gold Coin was located, certain rights therein
including an 18 year sub-leasehold interest (the "Sub-Lease"), subject to the
terms of an Over-Lease on the 76 Plaza between Prime, as lessee and National
Auto Truckstops, Inc. ("National") as lessor. At the same time, the Company
acquired from Prime the right to a 50% interest in the profits of the Gold
Coin under the terms of an agreement (the "Prime Agreement") under which the
Company agreed to pay Prime a total of $6.0 million for such profit interests
in the form of a promissory note (the "Prime Note"). On November 10, 1997, the
Company was advised that on October 16, 1997, National had placed Prime on
notice that its rights to occupy the 76 Plaza would terminate on January 23,
1998, due to an alleged breach of the Over-Lease by Prime. Subsequently, on
December 23, 1997, the Company filed a Petition for Concursus in the 15th
Judicial District Court, Lafayette Parish, Louisiana, Case No. 976174-D, and
paid the final $292,000 then owing under the Prime Note into the registry of
the court, protesting that such sum was not actually due and owing based on
the alleged breach of the Over-Lease by Prime. On or about December 30, 1997,
the Company received notice from Prime that Prime (which was not aware of the
Company's Petition for Concursus) considered the Company in default of the
Sub-Lease and demanded that the Company pay to Prime an amount equal to
approximately $299,513 on or before January 7, 1998 to cure its alleged
default. Upon receipt of this correspondence, the Company contacted counsel
for Prime and notified him of the Company's prior Petition for Concursus
filing. On or about January 19, 1998, Prime filed in United States District
Court, Western District of Louisiana, Case No. CV98-0076L-0, a Complaint for
Damages and Violation of the Petroleum Marketing Practices Act against
National, alleging breaches by National in the franchise agreement between
Prime and National and seeking to enjoin National from terminating the
Over-Lease. On or about January 21, 1998, Prime filed a Voluntary Petition in
Bankruptcy under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy
Court for the Western District of Louisiana, Case No. 98BK-50087, listing
National as the holder of an unsecured claim for $925,000 (the "National
Claim"). (See Form 10KSB/A for the year ended December 31, 1997, Item 6.
"Management's Discussion and Analysis and Results of Operations - Important
Factors to Consider".) On March 20, 1998, National filed various motions, as
permitted under section 362(d) of the Bankruptcy Code, to lift the automatic
stay and to permit certain actions by Prime. On April 13, 1998, the United
States Bankruptcy Court granted National's motions and dismissed Prime's
bankruptcy case. Following that decision, on April 17, 1998, National filed a
"Motion for Expedited Hearing on Motion to Return Possession of Premises to
National Auto" in the United States District Court, Western District of
Louisiana, Case No. 98-0076.

On May 22, 1998, the owners of Prime sold their interests in the 76 Plaza
truckstop property to Mr. Lee Young, who is the 51% member of Chrysolith. At
the same time, National and Prime (under its new ownership by Mr. Lee Young)
executed an Amended and Restated Lease Agreement which expired on December 31,
1999 (the "Lease"). Under the terms of the Lease, National has the right to
terminate the Lease under certain circumstances, including default or
non-renewal of the fuel franchise by Prime.

                                      3

<PAGE>

On May 22, 1998, the Company negotiated settlements by and among TWGLa,
Chrysolith, Prime and National (the "Settlement"). The terms of the Settlement
were as follows: (i) TWGLa and the former owners of Prime agreed that TWGLa
would make a final settlement payment to said former owners of $450,000,
subject to certain deductions, noted below, (the "Settlement Payment"), (ii)
the claim of National against Prime would be satisfied by: (a) liquidating the
assets of Prime, (b) paying to National the funds previously placed in the
registry of the court (Petition for Concursus file number 976174-D), and (c)
paying to National available cash in Prime relating to the sale of Prime's
truckstop inventory to National (the "Prime Assets") and (d) delivering a
promissory note from Prime (guaranteed by TWGLa and TWG) in the principal
amount of $239,597 bearing interest at the rate of 10% per annum payable in
four equal monthly installments beginning on June 22, 1998 (the "National
Promissory Note"); (iii) to the extent that the Prime Assets proved
insufficient to satisfy the National Claim, TWGLa would reduce the Settlement
Payment by the amount of such deficiency and remit such amount to National;
(iv) the remaining funds of the Settlement Payment first were used to pay
trade creditors and to reimburse TWGLa for payments made under the National
Promissory Note and any funds remaining after such payments and reimbursements
were paid to the former owners of Prime; (v) all of the litigation among the
parties was dismissed (See Item 3. "Legal Proceedings"); and (vi) all parties
agreed to mutually acceptable releases of all claims and liabilities against
the others. As of the date of this report, $450,000 has been paid by the
Company to the former owners of Prime.

OTHER TERMINATED VENTURES:

MULTIPLE APPLICATION TRACKING SYSTEMS, INC.

On April 15, 1997, the Company acquired Multiple Application Tracking Systems,
Inc. of Colorado ("MATS"), a supplier of casino software products. The
purchase price was $250,000, consisting of $15,000 in cash and a $235,000
promissory note (the "MATS Note") which was set to mature in November 2000. In
addition, the Company entered into a five-year employment agreement with Mr.
James Hardman, Jr. ("Hardman"), the previous owner of MATS, at an annual
compensation of $100,000. Mr. Hardman also was to receive ten percent (10%) of
all MATS sales as a license royalty. On February 15, 1999, however, the
Company sold MATS back to Hardman in return for his cancellation of the MATS
Note, termination of the employment agreement and $38,000 of severance
payments to benefit Hardman and one other employee.

THE BOXER CASINO

On March 31, 1997, Art Marketing, Ltd., d/b/a Tottenham & Co. ("Tottenham &
Co."), a wholly-owned subsidiary of the Company, executed a Joint Activity
Agreement with Mr. Mahmud Avdiyev, an individual engaged in various businesses
in Azerbaijan (the "Avdiyev Agreement"). The Avdiyev Agreement which is for a
term of twenty years, sets forth the parties' relative obligations with
respect to operation of the Boxer Casino located in Gyandja, Azerbaijan
Republic. In January 1998, the President of Azerbaijan ordered the closing of
all of the casinos in Azerbaijan including the Boxer Casino. The shutdown
resulted in the 1998 write-off of the unamortized balance of the Company's
investment of $295,000. Management cannot predict when, or if, the Boxer
Casino will reopen for business.

THE BISHKEK CASINO

In June 1998, the Company opened the Bishkek Casino located in the Kyrgyz
Republic, a former member of the Soviet Union. TWG has a twenty-year
management contract with Jockey Clubs Casinos, LLC ("JCC") under which TWG was
to receive 40% of the pre-tax profits of the casino. During 1998, the Kyrgyz
parliament passed a law which banned all casinos except those protected by the
country's foreign investment laws. The Bishkek casino is one of two casinos
that were allowed to remain open. However, in light of mounting losses and
unrealistic future prospects, the Company wrote-off its investment in the
Bishkek Casino of approximately $264,000 during 1998. In 1999, the Kyrgyz
parliament eliminated the foreign investment protection and the Bishkek Casino
was forced to close.

                                      4

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OTC BULLETIN BOARD

The Common Stock and Warrants currently are trading on the OTC Bulletin Board.

ACCOUNTING AND FINANCIAL ISSUES

In December 1998, the Company reviewed the carrying amount of long-lived
assets, identifiable intangibles and goodwill related to its Czech Republic,
Spanish, Boxer and Bishkek casino operations under FASB No. 121 "Accounting
for the Impairment of Long-Lived Assets and for Long-Lived Assets to be
Disposed Of." Based on a comparison of those assets against the expected
future cash flows generated by those operations, the Company recorded an asset
impairment charge of $2.5 million for the Czech operation, $1.5 million for
the Spanish operation and amortized its entire investment in Bishkek
($264,000) and Boxer casinos ($295,000) during the year ended December 31,
1998. The Company based the write-off in the Czech Republic on increased
competition in Ceska Kubice, lower than anticipated revenue in Rozvadov and
the fears that the proposed casino near Snojmo would be a smaller operation
with fewer gaming tables and machines than originally forecasted. In Spain,
delays in receiving permission to move the casino to a more favorable
location, together with a smaller operation than originally planned, is the
basis for the impairment charge.

The Company has, from time to time, been in technical default of the Amended
Indentures and has relied upon the forbearance and waivers from a majority
interest of the holders of the Senior Notes. Value Partners represents this
majority in interest of the holders of the Senior Notes. At December 31, 1999,
Value Partners owned 59% of the Company's long-term debt and owned warrants
which, upon exercise, would result in Value Partner's beneficial ownership of
Common Stock equaling 61.2% of the Company's issued and outstanding shares of
Common Stock.

The accompanying consolidated financial statements have been prepared assuming
the Company will continue as a going concern. The Company has suffered
significant losses from operations, has a working capital deficit of $3.9
million, and a stockholders' deficit of $14.2 million as of December 31, 1999.
Further, the Company is highly-leveraged with debt and, from time to time has
been able to pay its obligations when they become due. These conditions raise
substantial doubt about the Company's ability to continue as a going concern.
The consolidated financial statements do not include any adjustments that
might result from the outcome of this uncertainty. The Company has taken steps
to improve its situation including the December 1999 opening of its third
Czech Republic casino and certain cost cutting measures. Furthermore,
management's plans include the growth of its existing business through
relocation of the Ceska casino; expansion of the Rozvadov casino; the addition
of five gaming tables to the casino near Snojmo; continued marketing campaigns
and promotional events; and CDZ's move to the center of Zaragoza. Further, the
Company's strategy for the future includes development of a hotel division and
expansion of its portfolio of gaming operations in terms of geographical
location.

CORPORATE INFORMATION

The Company's corporate offices are located at 545 Fifth Avenue, Suite 940,
New York, New York 10017 and its telephone number is (212) 983-3355.

FINANCIAL INFORMATION ABOUT INDUSTRY SEGMENTS

The Company previously operated in three business areas, which, for accounting
purposes, were consolidated into two industry segments: the ownership and
management of gaming establishments overseas, which includes the operation of
a full service hotel overseas; and the operation of truckstops featuring VLTs.
As a result of the June 30, 1999 termination of its Louisiana gaming
operations, the Company has reported them as discontinued operations.

                                      5

<PAGE>


NARRATIVE DESCRIPTION OF BUSINESS

The Company is engaged in the acquisition, development and management of niche
casino operations worldwide which feature table games and mechanized gaming
devices, such as slot and video poker machines as well as development and
management of small to midsize hotels which include casino facilities. On
March 31, 1998, the Company acquired two casinos in the Czech Republic and
land upon which a third casino was built and opened in December 1999. The
Czech Republic casinos are located close to major border crossings with
Germany in Ceska Kubice and Rozvadov and near the border crossing with Austria
close to Snojmo. The Zaragoza casino and hotel, acquired on April 17, 1998, is
located approximately 15 miles outside of Zaragoza, Spain, and is the
exclusive casino licensee in the region of Aragon. (See "- General Development
of Business," above, and "Future Operations," below).

INDUSTRY OVERVIEW

Prior to the amendments to the Czech gaming regulations in December 1998,
local municipalities were empowered to grant casino licenses in their regions.
The amendments to the gaming legislation removed that right from the local
governments and effectively eliminated exclusivity. Another entity has
recently opened a competing casino in Folmava, Czech Republic, near the
Company's Ceska Kubice location which, because of its location, may negatively
impact Ceska Kubice's revenue.

In Spain, the regional government, DGA, which is also the largest creditor of
CDZ, signed a protocol in April 1998 with TWG stating its intent to pass a law
allowing the casino to move to a more favorable location. There is opposition
by an Aragonian parliamentary party to the new law unless an amendment that
would allow casino-style slot machines in bingo parlors is included. Rather
than agree to this amendment, the DGA decided to issue a governmental decree
which will circumvent the parliament and allow CDZ to move from its current
location. Instead of a decree, in February 2000, the DGA introduced a law that
would allow the casino to relocate nonetheless. The law is expected to be
presented to local Spanish parliament in June 2000. Management believes, based
on its discussions with Spanish authorities, the law has little opposition and
is expected to pass.

THE COMPANY'S FACILITIES

LOUISIANA GAMING

The Gold Coin and Toledo Palace gaming facilities were closed June 30, 1999,
and the Gold Coin sub-lease was terminated by the landlord effective July 31,
1999. The VLT machines were sold in 1999 for $84,000.

WOODLANDS TRUCKSTOP

The Woodlands, where the Toledo Palace was located, was sold on October 4,
1999 for $295,000.

CZECH REPUBLIC

The Ceska Kubice casino currently has fifteen gaming tables, seventy slot
machines and parking for approximately forty cars. In Rozvadov, there are
seven tables, thirty-eight slot machines and parking for forty cars. In
Snojmo, there are eleven gaming tables, forty-two slot machines, and parking
for one hundred twenty cars.

SPAIN

The casino currently has nine gaming tables and twenty-four slot machines. The
facility also has thirty-seven sleeping rooms, approximately 7,169 square feet
of Banquet space, four shooting ranges, a swimming pool, a tennis court, and
3,557 square feet of space that was formerly operated as a nightclub.

                                      6

<PAGE>


FUTURE OPERATIONS

CZECH REPUBLIC

In April 1999, the Company purchased a parcel of land in Folmova, Czech
Republic in the same region as the existing Ceska casino but nearer to the
German border. The Company intends to construct a new casino on this land and
to relocate the Ceska operation to the new facility. This move would give the
casino excellent exposure because it would be located directly on the border
road; would be located nearer to the border than the access road for the
casino of Ceska's main competitor; would allow for a larger parking facility
than that which exists in Ceska; would address the issue of capacity
constraints on the weekend in that it would allow for an increase in the
number of gaming tables over the existing space; and would allow for a floor
plan to be designed which, unlike the Ceska building, would optimize the
casino's equipment layout. Subsequent to relocation of the casino operation
from Ceska to Folmova, the Ceska facility will be used as office space and as
a training center supporting all of the Czech casinos.

Based on the attendance versus capacity challenges experienced at the existing
casino in Rozvadov, the Company is moving forward with its budget plan to
expand the facility by adding two gaming tables.

The casino near Snojmo opened on December 22, 1999 and has, in terms of both
attendance and Total Drop (the dollar amount of gaming chips sold), thus far
exceeded budgeted expectations. The budget calls for the addition of five
gaming tables in October, 2000, and based on the promising results in the
first quarter of 2000, that timetable may be accelerated.

SPAIN

In anticipation of receiving permission to move CDZ to center city Zaragoza,
TWG is in the process of completing negotiations to lease available space in a
cinema adjacent to a downtown hotel location. The cinema was chosen due to its
desirable location, together with the advantages of providing common services
with the hotel (food, maintenance, parking and accommodations). CDZ, which is
expected to reopen at this new location within ten months after it receives
permission to move, pending local planning board approvals, will have
approximately 17 gaming tables and 120 slot machines. The investment required
by TWG upon receipt of the approvals is anticipated to total approximately
$5.0 million (See Item 6. "Management's Discussion and Analysis or Plan of
Operation - Liquidity and Capital Resources".).

Except as described above, the Company has no other specific arrangements or
understandings with respect to the management or acquisition of any gaming
facility. There can be no assurance that the Company will manage or acquire
any other gaming facilities in the future, although it hopes to do so.

LONG RANGE OBJECTIVE

The Company's long-range objectives are to develop the Company's casino
operations brand name, American Chance Casinos, into the premier name in the
small casino niche market overseas; to establish Trans World Gaming Corp. as
the industry leading owner/operator and management company in this market; and
to further diversify the Company's operations to include ownership and/or
management of small to midsize hotels which are complementary to the Company's
casino operations. To achieve these goals, the Company's strategy consists of:
(i) identifying business opportunities in areas where economic conditions,
cultural habits, and political climates are favorable to investment in
existing, or construction of new, gaming and hotel facilities; (ii) forming a
team of TWG's casino and hotel experts to develop and market a complete set of
operational and administrative guidelines for the purpose of securing casino
and hotel management contracts; and (iii) continuing to demonstrate its
effectiveness as an owner/operator of small casinos through improved
efficiencies in its existing operations.

Some of the specific action plan initiatives, which support this third
strategy, are as follows:

TWG management will continue to develop marketing and operational initiatives
designed to increase attendance and revenues at its existing locations in the
Czech Republic and Spain. The Company has

                                      7

<PAGE>

acquired land close to the German border near Ceska Kubice, at Folmava, Czech
Republic and is planning to build a casino to replace the existing facility
and relocate the Ceska Kubice to this facility. Management believes that the
new location will be more accessible to its main target market in Germany and
will result in improved attendance and play. In addition, TWG transferred
excess slot machines from Ceska Kubice and Rozvadov to its new location near
Snojmo.

The Company will continue to seek ways to reduce operational and overhead
costs. For example, the Company has recently reorganized the Czech Republic
management structure and is in the process of closing its London offices,
measures that will produce an annual savings of approximately $450,000.

Financial reporting, which was identified by management as an area in need of
improvement, will continue to be a focus of attention. Beginning in January
2000, a new monthly financial reporting program was successfully introduced.
The Company, also, is exploring the possibility of replacing its general
ledger systems and has included the purchase thereof in its 2000 Capital Plan.

MARKETING

CZECH REPUBLIC

In 1999, the Management implemented a marketing strategy designed to increase
the number of visitors to its casinos in Ceska and Rozvadov. The target area
was the sixty-mile radius surrounding each of these casinos. These areas were
addressed through the use of direct mailings, flyers, radio, newspaper,
billboard advertising and improved directional signage in English, German and
Czech, as appropriate. Customer loyalty programs, special events and
promotions and a busing program were also developed and implemented. The
Company's new casino near Snojmo was introduced to the residents of Vienna and
its northern suburbs through a campaign of radio spots using the Rhett Butler
and Scarlet O'Hara characters; free standing and bus mounted billboard
advertising; and "Gone With The Wind" theme newspaper advertisements. The
casino was then launched with opening parties on three successive nights.
These parties, which targeted local politicians and business leaders as well
as foreign investors and other foreign VIPs, included ribbon cutting
ceremonies, fireworks, fire dancers, a live band, and a professionally catered
dinner. The introductory marketing strategy proved to be highly successful
with the casino receiving positive press coverage in well-reputed publications
in the Vienna area. Moreover, as previously noted, the casino's attendance
has, for the first three months of operations, surpassed the Company's
projections.

SPAIN

TWG is currently marketing the new CDZ casino through direct mailings, radio,
newspapers and billboard advertising in English and Spanish, as appropriate.
By Spanish law, casinos are not permitted to do any direct advertising.
Promotions of the casino, therefore, must be piggybacked on advertisements of
other services that the property offers. In 1999, the Company suspended its
food and beverage banquet ("Catering") operations in response to profitability
and personnel issues. Pursuant to the reorganization of this department and
the introduction of pro forma profit and loss reports for all event inquiries,
the Company has relaunched the Catering business. The advertising associated
with the Catering business will provide a vehicle for greater advertising
exposure for the casino as well.

ACQUISITION AGREEMENT

TOTTENHAM & CO. On January 1, 1997, the Company completed the acquisition of
Tottenham & Co., which was founded in 1988 by Andrew Tottenham, the Company's
President and Chief Operating Officer ("COO"). Tottenham & Co. is engaged in
providing consulting services to gaming companies worldwide. The consideration
paid for Tottenham & Co. by the Company included 500,000 shares of the
Company's Common Stock, and warrants to purchase 250,000 shares at an exercise
price of $.5938, the bid price of the Company's Common Stock on the date of
the acquisition as reported by the Nasdaq SmallCap Market System. In addition,
the Company issued two promissory notes in the aggregate principal amount of
$200,000 bearing interest at the rate of 10% per annum and payable on January
1, 2002 (the "Tottenham Notes"). On December 31, 1998, the Company and Mr.
Tottenham converted the Tottenham Notes and

                                      8

<PAGE>

accrued interest totaling $240,000 into 320,000 shares of the Company's Common
Stock. All of the Common Stock, as well as the Common Stock underlying the
warrants, carries certain "piggyback" registration rights.

REGULATIONS AND LICENSING

SPAIN. The new law that would allow CDZ to move to the center of Zaragoza has
been passed from a parliamentary committee to the floor of the regional
parliament. However, a certain amendment to the law is of concern to TWG. The
proposed amendment would allow bingo operators in Aragon to install
casino-style slot machines. The DGA, which is controlled by the largest party
in parliament, opposed the amendment and decided to issue a governmental
decree to circumvent the parliament and allow the casino to move to the center
city. However, instead of a decree, in February 2000, the DGA introduced a law
that would allow the casino to relocate. The law is expected to be presented
to local Spanish parliament in June 2000. Based on discussions with Spanish
authorities, the law has little opposition and is expected to pass.

CZECH REPUBLIC. During the quarter ended June 30, 1998, the Czech Republic
House of Deputies passed an amendment to the gaming law which restricted
foreign ownership of casino licenses. In response thereto, the Company
restructured its subsidiaries and Czech legal entities to comply with the
amendment and was subsequently granted a ten-year license. It is currently
anticipated that the foreign ownership restriction will be lifted in 2000.
There may be increased competition, however, at that time, in the areas where
the Company operates because local municipalities no longer have control over
the issuance of casino licenses, thereby effectively eliminating exclusivity.
There can be no assurance that the authorities in the Czech Republic will not
amend the gaming law as it pertains to foreign ownership of casino licenses.
In the event the gaming laws are amended in the future, it may have a material
adverse effect on the Company's future profitability and operations.

APPLICATION OF FUTURE OR ADDITIONAL REGULATORY REQUIREMENTS. In the future,
the Company intends to seek the necessary licenses, approvals and findings of
suitability for the Company and its personnel in other jurisdictions; however,
there can be no assurance that such licenses, approvals or findings of
suitability will be obtained or will not be revoked, suspended or conditioned
or that the Company will be able to obtain the necessary approvals for its
future activities. If a license, approval or finding of suitability is
required by a regulatory authority and the Company fails to seek or does not
receive the necessary license or finding of suitability, the Company may be
prohibited from owning or operating gaming establishments in that jurisdiction.

GAMING TAXES. Gaming taxes in the various locations where the Company operates
range from 10% to 55% of net gaming revenues. There can be no assurance that
tax rates, fees or other payments applicable to the Company's gaming
operations will not be increased in the future.

FEDERAL REGULATION

The Federal Gambling Devices Act of 1962 (the "Federal Act") generally makes
it unlawful for a person to manufacture, deliver, or receive gaming machines,
gaming machine type devices, and related components across state lines or to
operate gaming machines unless that person has first registered with the
Attorney General of the United States. In order to manufacture, sell, deliver,
or operate certain of its current and proposed products, the Company must
register and renew its registration annually. In addition, various record
keeping and equipment identification requirements are imposed by the Federal
Act. Violation of the Federal Act may result in seizure and forfeiture of
equipment, as well as other penalties. The Company is currently registered and
maintains the reports required under the Federal Act.

COMPETITION

The Gold Coin and the Toledo Palace competed with other forms of legal and
illegal gambling, including bingo and pull-tab games, card clubs, pari-mutual
betting on horse racing and dog racing and state-sponsored lotteries, as well
as other forms of wagering entertainment. Neither of these entities is
operational at this time, due to the Voter Mandate. The Company's Czech
casinos compete with

                                      9

<PAGE>

approximately twelve other casinos in the area with two new casinos under
construction across the German border. Due to the exclusivity of the Spanish
casino license, the bingo operations in Zaragoza are CDZ's only competition.
(See Item 1. "Description of Business - Industry Overview").

EMPLOYEES

As of March 31, 2000, the Company had 464 full-time employees (including three
executive officers): 372 in the Czech Republic, 84 in Spain, 4 in London, and
4 in New York, respectively. The Company believes that its employee relations
are excellent.

ITEM 2.  DESCRIPTION OF PROPERTY.

CORPORATE OFFICES

The Company's corporate offices are located at 545 Fifth Avenue, Suite 940,
New York, New York, occupying 1,559 square feet of office space under a lease
at the rental rate of $5,456.50 per month expiring in December 2004.

The Company leases approximately 1,500 square feet of office space in London,
England for the Development and Human Resources teams on a five-year lease
expiring in April 2003 at approximately $4,000 per month. In light of the fact
that the London-based employees work, almost exclusively, on the road, the
Company is in the process of closing the London office as part of its cost
cutting strategy.

LOUISIANA

The Company's lease for the Gold Coin was terminated effective July 31, 1999.
TWGLa owned the 20-acre site on which the Woodlands is located in DeRidder,
Louisiana which was sold on October 4, 1999 for $295,000.

CZECH REPUBLIC

The Company leases a 5,000 square foot casino facility in Ceska Kubice under
the terms of an agreement that expires in 2010. The Company also leases a
hotel from a local bank in nearby Krasnahorska for staff accommodations at the
rate of approximately $1,400 per month. The hotel will continue to be used for
staff accommodations should the casino be relocated to Folmova.

In Rozvadov, the Company owns the casino building and an adjacent facility for
staff accommodations.

As part of the acquisition of Resorts (See Item 1. "Description of Business
-General Development of Business"), TWG acquired approximately 10 acres of
land near Snojmo, close to the border in Austria, on which the Company
constructed and operates a casino. TWG negotiated an agreement with a local
building contractor who financed and built a 5,000 square foot casino facility
and leased it to the Company under the terms of a ten-year lease for
approximately $27,000 per month. (See Item 1. "Description of Business -
Future Operations").

SPAIN

The Company leases the current CDZ casino facility from the DGA on a
month-to-month basis.

ITEM 3.  LEGAL PROCEEDINGS.

In March 1996, the Company learned that as of June 30, 1995, Monarch Casinos
("Monarch"), a Louisiana-licensed video gaming device operator in which it
owned a 49% interest, had not renewed its operator's license as required by
the State of Louisiana, and as such, was no longer a licensed video poker
operator in the State. Pursuant to the management agreements between Monarch
and the Company, such a failure to renew or other termination of the
operator's license created a default under the agreements and the

                                     10

<PAGE>

agreements were terminated by the Company on March 14, 1996. On or about
November 6, 1997, the Company was sued for breach of contract by Monarch
Casinos, Inc. of Louisiana and Michael A. Edwards in the 15th Judicial
District Court, Lafayette Parish, Louisiana, Case No. 97-5037B. Mr. Edwards
claimed compensation charges of approximately $2.2 million and punitive
charges of $11.1 million and alleged that the Company breached a management
contract dated September 21, 1994. The lawsuit was settled for a cash payment
of $100,000 on May 15, 1999. The final order of dismissal with full prejudice
which terminated the litigation and disposed of all claims in the lawsuit was
issued by the United States District Court of Louisiana on May 24, 1999.

On January 25, 1997 (prior to the Company's acquisition of 90% of CDZ), the
directors of CDZ filed an application in the Court of First Instance Number 11
of Zaragoza to declare CDZ in temporary receivership. Temporary receivership
was granted on June 23, 1997 and the property continues to operate in
receivership status.

On May 22, 1998, the Company entered into the settlement relating to the Prime
Agreement. (See Item 1. "Description of Business - General Development of
Business.")

The Company is currently involved as a plaintiff, through its Chrysolith
affiliate, in litigation challenging the Voter Mandate. (See Item 1.
"Description of Business - Louisiana Operations.")

The Company is not currently involved in any other material legal proceeding
nor was it involved in any other material litigation during the year ended
December 31, 1999.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

No matter was submitted to a vote of security holders during the fourth
quarter of the fiscal year covered by this Report.

















                                     11
<PAGE>

PART II

ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

The Company's Common Stock and warrants (the "$8.50 Warrants") are currently
on the OTC Bulletin Board under the symbols IBET and IBETW, respectively. The
following table sets forth the high and low prices of the Company's Common
Stock and the $8.50 Warrants for fiscal years 1998 and 1999:


<TABLE>
<CAPTION>

---------------------------------------------------------------------------------
                   Common Stock                                 High       Low
                   --------------------------------------------------------------
                   <S>                                          <C>       <C>
                   1998
                   First Quarter.......................         0.78*     0.30*
                   Second Quarter......................         0.75*     0.46*
                   Third Quarter.......................         0.46*     0.31*
                   Fourth Quarter......................         0.31*     0.24*
                   1999
                   First Quarter.......................         0.44*     0.24*
                   Second Quarter......................         0.59*     0.26*
                   Third Quarter.......................         1.50*     0.31*
                   Fourth Quarter......................         0.85*     0.50*
                   --------------------------------------------------------------

---------------------------------------------------------------------------------
                   $8.50 Warrants                               High       Low
                   --------------------------------------------------------------
                   <S>                                          <C>       <C>
                   1998
                   First Quarter.......................         0.03*     0.00*
                   Second Quarter......................         0.03*     0.02*
                   Third Quarter.......................         0.02*     0.01*
                   Fourth Quarter......................         0.02*     0.00*
                   1999
                   First Quarter.......................         0.02*     0.01*
                   Second Quarter......................         0.01*     0.00*
                   Third Quarter.......................         0.04*     0.00*
                   Fourth Quarter......................         0.02*     0.00*
                   --------------------------------------------------------------


</TABLE>


* Quoted on OTC Bulletin Board

As of the date of this Report, there were (a) 5,365,449 shares of Common Stock
outstanding held of record by approximately 1,300 persons, (b) outstanding
options to purchase an aggregate of 35,000 shares of Common Stock not part of
the Company's 1993 Incentive Stock Option Plan (the "1993 Plan"), (c)
outstanding $8.50 Warrants to purchase an aggregate of 1,511,429 shares of
Common Stock, which have since expired, (d) outstanding $0.01 Series D
Warrants to purchase an aggregate of 2,051,912 shares of Common Stock issued
in connection with the March 1996 financing, (e) outstanding $11.55 Warrants
to purchase an aggregate of 151,143 shares of Common Stock, which have since
expired, (f) outstanding $13.50 Warrants to purchase an aggregate of 151,143
shares of Common Stock, which have since expired, (g) outstanding $1.50 Series
B Warrants to purchase an aggregate of 3,200,000 shares of Common Stock issued
in connection with the restructuring of certain long-term debt, (h)
outstanding $1.00 Series A Warrants to purchase an aggregate of 960,000 shares
of Common Stock issued in connection with the sale of certain debt
instruments, (i) outstanding $.5938 Warrants to purchase an aggregate of
250,000 shares of Common Stock issued in connection with the acquisition of
Tottenham & Co. (see Item 1. "Description of Business - Acquisition
Agreements"), (j) outstanding $.50 warrants to purchase an aggregate of
220,760 shares of Common Stock issued in connection with the 1997 Promissory
Note which have since expired, (See Item 6."Management's Discussion and
Analysis or Plan of Operation - Liquidity and Capital Resources"), (k)
outstanding $.01 warrants to purchase an aggregate of 104,225 shares of Common
Stock issued in connection with the debt financing to fund the Bishkek Casino
transaction and (l) outstanding $0.01 Series C to purchase an aggregate of
5,440,663 shares of Common Stock issued in connection with the March 1998
Private Placement, 1,646,789 of which have been exercised, and (m) outstanding
$0.01 Series G warrants to purchase an aggregate 1,250,728 shares of Common
Stock issued in connection with the October 1999 Private Placement and the
October 1999 Senior Notes. (See Item 6. "Management's Discussion and Analysis
or Plan of Operation - Liquidity and Capital Resources").

                                     12

<PAGE>

The Company has not declared or paid any cash dividends on its Common Stock
since its inception and does not intend to pay any dividends for the
foreseeable future.

ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS.

FORWARD-LOOKING STATEMENTS

This Form 10-KSB/A contains certain forward-looking statements. For this
purpose, any statements contained in this Form 10-KSB/A that are not
statements of historical fact may be deemed to be forward-looking statements.
Without limiting the foregoing, words such as "may," "will," "expect,"
"believe," "anticipates," "estimates," or "intends" or comparable terminology
are intended to identify certain forward-looking statements in this and other
sections of the Form 10-KSB/A. These statements by their nature involve
substantial risks and uncertainties, and actual results may differ materially
depending on a variety of factors, including those set forth in the section
below entitled "Important Factors to Consider."

RESULTS OF OPERATIONS

The following discussion and analysis relates to the financial condition and
results of operations of the Company for the year ended December 31, 1999.

This information should be read in conjunction with the Company's Consolidated
Financial Statements and notes appearing elsewhere herein. All amounts in the
following discussions have been rounded to the nearest thousand except where
indicated.


      YEAR ENDED DECEMBER 31, 1999 COMPARED TO YEAR ENDED DECEMBER 31, 1998


<TABLE>
<CAPTION>

          -------------------------------------------------------------------------------------
           Results of Operations                              For the Years Ended December 31,
          -------------------------------------------------------------------------------------
                                                                        1999          1998
          <S>                                                       <C>            <C>
           Revenue...........................................       $  12,294      $  9,016
           Pre-tax (loss)....................................          (6,187)      (10,500)
           Loss from continuing operations...................          (6,187)      (10,691)
           Loss from discontinued operations(1)..............            (222)          (38)
           Net Loss..........................................          (6,409)      (10,729)
           Other Comprehensive Income........................             923           112
           Comprehensive Loss................................          (5,486)      (10,617)
           Earnings/(loss) per common share - Basic..........       $   (1.78)     $  (3.52)
           Earnings/(loss) per common share - Diluted........       $   (1.78)     $  (3.52)
           Weighted average common shares outstanding:
                    Basic....................................        3,598,000     3,044,286
                    Diluted..................................        3,598,000     3,044,286
          -------------------------------------------------------------------------------------


</TABLE>


----------------
      (1) Discontinued operations consist of those in Louisiana (i.e. Gold Coin
and Toledo Palace).


REVENUES

The Company's net revenues in 1999 are derived from a full year of activity of
the operations in the Czech Republic and Spain and a partial year's activity
in the casino in the Kyrgyz Republic. The following table lists the revenue by
operation:

           TWG REVENUES FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
                              (Dollars in millions)

<TABLE>
<CAPTION>

    ----------------------------------------------------------------------------------------------------
                                                                          Increase/(Decrease)
    ----------------------------------------------------------------------------------------------------
                                               1999            1998               $               %
                                              -----            ----          ------         --------
    <S>                                       <C>              <C>           <C>            <C>
    Czech Republic(1) Ceska .........           6.5             4.2             2.3            55%
    Rozvadov.........................           1.8             1.3              .5            38%
    Spain(2) ........................           3.9             3.5             0.4            10%
    Other(3) ........................           0.1             0.0             0.1           100%
                                              -----            ----          ------         -------
                                              $12.3            $9.0          $  3.3            37%
                                              =====            ====          ======         =======
    ----------------------------------------------------------------------------------------------------

</TABLE>


    (footnotes to follow)

                                                        13

<PAGE>

--------------
         (1) The Czech Republic casinos were acquired on March 31, 1998.
         (2) The Spanish casino, CDZ, was acquired on April 17, 1998.
         (3) Includes Corporate Office generated consulting revenue.

Gaming revenues, the Company's primary source of income, are comprised of
Table Game Win, Table Game Tips, Slot Machines, Reception (entrance fees), and
sales of Food and Beverage.

Table Game Win, the largest contributor in the sales mix, is measured as a
percentage of Total Drop, the dollar amount of all gaming chips sold. The
Total Drop is the product of the attendance and the average dollar amount of
chips sold to each guest (Drop per Head). The Drop per Head statistic is used
to measure the "quality" of the guests in terms of their volume of play.
Stated simply, these key performance indicators tell us how many people
attended the casinos, the average dollar value of chips each person purchased,
and what portion of the purchased chips were lost to the House (i.e. were not
cashed in).

The aforementioned statistics for the years ended December 31, 1999 and 1998
are presented in the table below. Please note that, for comparison purposes,
the 1998 statistical data represents the full year's operation, including the
period prior to acquisition of the properties by the Company.

                             (DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>

----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
                                                             1999                 1998
                                                             ----                 ----
        <S>                             <C>               <C>           <C>      <C>        <C>
        Total Drop/Drop per Head         Ceska            $  22,197      $386    $20,493      389
                                        Rozvadov              6,241       187      4,260      317
                                        Zaragoza             14,774       610     14,579      454
                                        ------------------------------------------------------------
                                          Total           $  43,212      $375    $39,333      400
                                        ------------------------------------------------------------

                Win/Win%                 Ceska            $   4,598     20.7%    $ 3,937    19.2%
                                        Rozvadov              1,237     19.8         825    19.4
                                        Zaragoza              2,438     16.5       2,434    16.7
                                        ------------------------------------------------------------
                                          Total           $   8,273     19.1%    $ 7,197    18.3%
                                        ------------------------------------------------------------

                Attendance               Ceska               57,566               52,690
                                        Rozvadov             33,359               13,451
                                        Zaragoza             24,219               32,101
                                        ------------------------------------------------------------
                                          Total             115,144               98,242
                                        ------------------------------------------------------------

====================================================================================================


</TABLE>


The year over year growth of 10% in Total Drop is the net result of two
counterbalancing trends. While the overall attendance improved, the Drop per
Head decreased due to the higher proportion of casual players in the guest mix.

The attendance figure comparison (1999 vs. 1998) reflects the marketing
strategy that was employed in 1999, namely, to grow the attendance in Ceska
in off-peak times and to improve attendance in all periods in Rozvadov.

                                     14


<PAGE>

Zaragoza's attendance in 1999 was well below that of 1998. This negative
trend was due to the fact that the 1998 attendance figure included guests who
were attracted to the casino through very attractively priced (below cost)
buffets, but the vast majority of whom did not play the tables. With the
acquisition in 1998, TWG implemented the necessary price increases which
effectively drove away the discount diners. In addition, bad press reports
and suspension of the unprofitable Catering business, which limited the
advertising exposure for the casino, served to further erode the client base
in 1999.

Table Game Tip revenue consists of the gaming chip gratuities bestowed upon
gaming table Dealers by casino patrons. In the Czech Republic, one hundred
percent of this Tip revenue is retained by the House. In Spain, on the other
hand, per an employee bargaining agreement, employees enjoy thirty-five
percent participation in the Tip revenue. In 1999, total Tip revenue was $1.2
million versus $1.4 million in 1998, a decrease of 13%. Tip revenue declined
in Ceska and Zaragoza and increased slightly in Rozvadov. As a


                                       15
<PAGE>

percentage of Total Drop, however, all three casinos experienced declines. The
reason for the lower Tip percentages in the Czech Republic casinos lies in the
fact that the previous operators and management of the company supported staff
solicitation of customers for tips. This culture, which management considers
to have a negative impact on customer relations, was terminated over time by
TWG. In Zaragoza, the Tip percentage decline was slight (.2 percentage points)
and was indicative of the fact that the number of French Roulette, a game that
generally produces higher Tip rates, tables was reduced in response to changes
in the client mix.

Slot revenue, which is the cash generated net of paid wins, was $627,000 in
1999 versus $391,000 in 1998, an increase of 60%. The growth can be attributed
to the fact that the casino in Rozvadov operated without slot machines until
September 1998 at which time eighty-seven machines were installed. Also in
September 1998, the number of slot machines in Ceska was increased from 22 to
100. In Zaragoza, a 10% increase in Slot revenue was realized in 1999 despite
the fact that attendance at the casino decreased by 7,882. The increase can be
attributed to promotional efforts and the aforementioned shift in the client
mix.

Gaming related Food and Beverage revenues are generated on only a portion of
the food and beverage that is served because they are, to a large extent,
regarded as a necessary amenity to the gaming patrons. Complimentary buffets
and free drinks to playing customers are the practice in the Czech Republic.
In Spain, food and beverage giveaways are at the discretion of the casino
manager, who uses them as a customer relations tool. In 1999, total
gaming-related Food and Beverage revenue was $198,000, which represents a 45%
increase over 1998 revenue of $137,000 and is indicative of the fact that the
1999 total represents a full year of operation whereas the 1998 total reflects
the post acquisition period only.

In Zaragoza, revenues are also derived from rentals of the property's
thirty-seven sleeping rooms; telephone, laundry, and mini-bar revenues
associated with the sale of the sleeping rooms; and food, beverage, and other
revenues associated with Catering operations. For the fiscal year ended
December 31, 1999, revenues from these areas was $378,000 compared to 1998,
where these activities produced revenue of $553,000. The decline in revenue
from 1998 to 1999 can be attributed to the halting of Catering operations in
the Fall of 1999 in response to concerns about the profitability of the
operations and to the elimination of the below-cost buffets in the restaurant.

COST OF REVENUES

Cost of Revenues consists of the direct costs of operating the Czech Republic
and Spain casinos, primarily in the areas of labor, security, and general
office expenses. The Cost of Revenues is shown in the following table:

       TWG COST OF REVENUES FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
                              (Dollars in millions)

<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------
                                                                                Increase/(Decrease)
----------------------------------------------------------------------------------------------------
                                          1999            1998             $               %
<S>                                       <C>             <C>            <C>               <C>
Czech Republic..................               $4.8            $3.6       $1.2
Spain..............................             3.3             3.9       (0.06)                (15)%
                                               ----            ----
                                               $8.1            $7.5       $0.6                    8%
                                               ====            ====       ======
----------------------------------------------------------------------------------------------------
</TABLE>

Costs of revenues in 1999 were $4.8 million (58% of total revenues) in the
Czech Republic, which represents a 7 percentage point ("ppt") improvement
over 1998, and $3.3 million (85% of total revenues) in Spain, which
represents a 26 ppt improvement over 1998. The 51% revenue growth in the
Czech Republic, coupled with the successful implementation of several cost
cutting measures, and the Company overcoming startup issues relating to the
casino near Snojmo, are responsible for the positive trend in this area.
Spain's high cost to revenue ratio is due to a number of issues including: a
lack of flexibility in labor scheduling; the limited size of the casino (9
tables); the location of the facility; and the limited number of guest rooms.
Although considerably higher than the cost of revenue ratio in the Czech
Republic, 1999's 85% ratio in


                                       16
<PAGE>

Spain represents a significant improvement over 1998, a year in which the
cost of revenues exceeded the revenue by 11%. The total cost of revenues for
the Company was $8.1 million in 1999 versus $7.5 million in 1998, an increase
of 8%.

Selling, general and administrative expenses were $4.3 million in 1999, which
represents a 75% increase over 1998. This increase is, primarily,
attributable to the fact that the costs reflected in 1998 do not represent a
full year period as well as the result of 1999 expenditures related to
increased marketing efforts; pursuit of other gaming opportunities (i.e.
development); administrative startup costs associated with the third casino
located near Snojmo, and the addition/replacement of several key Corporate
positions while continuing to pay severance to departed executives.

Depreciation and amortization increased from $2.5 million in 1998 to $2.8
million in 1999 due, primarily, to the amortization of assets acquired during
1998 and 1999. (See Item 1. "Description of Business"). Interest expense for
the year ended December 31, 1999 was $3.0 million compared to $2.5 million
for the year ended December 31, 1998. The increase is due, primarily, to
twelve months of interest on the $17 million Indenture being incurred in 1999
versus nine months of interest having been incurred on this debt in 1998. In
addition, interest related to the supplementary $3 million Indenture was
incurred in the final two plus months of 1999.

Also of note is the fact that, unlike 1998, the Company did not incur any
impairment charges in 1999. In 1998, after reviewing the carrying amounts of
long-lived assets recorded, an asset impairment charge of $4 million was
taken.

EARNINGS/(LOSS)

The Company incurred a loss of approximately $6.2 million from continuing
operations for the year ended December 31, 1999 as compared to $10.7 million
in the year ended December 31, 1998, an improvement of 42.1%. The improvement
is primarily attributable to the fact that there was no need for an
impairment charge in 1999. Other factors contributing to this improvement
include, as discussed previously, increased attendance and improved
efficiency in the Czech and Spanish gaming markets.

CESKA, CZECH REPUBLIC

Total revenue from the casino in Ceska, Czech Republic was $6.5 million for
the fiscal year ended December 31, 1999, which represents a 55% increase over
the previous year's revenue total of $4.2 million.

Comparison of the twelve month statistics between 1999 and 1998 reveals that
the revenue produced in the three additional months in which the casino
operated is not the sole source of the 55% revenue growth. Part of the
improvement can be attributed to a 1.5 ppt increase in the Win percentage
(from 19.2% in 1998 to 20.7% in 1999). Ceska's attendance improvement was the
direct result of a number of successful marketing campaigns including themed
parties and a midweek Tombola, which was designed to attract clients on
off-peak days. A Tombola is a prize drawing event, which is stretched out
over several weeks. The odds of winning a Tombola drawing are governed by the
amount of play a customer gives during off-peak times over the period of the
event.

In 2000, the marketing emphasis in Ceska will be, in addition to building on
the success of the above initiatives, to increase the use of advertising
media (direct mail, television, radio and press) in order to further
stimulate off-peak attendance and to improve the "quality" of patrons.

In the Fall of 1999, a competitive casino opened in Folmova, which is closer
to the German border than the Company's Ceska property. This casino, which is
called the Schoolhouse, has employed a strategy of attracting clients through
the distribution of flyers at the border crossing and the posting of signs at
the casino's access road turnoff.


                                       17
<PAGE>

Despite the increased competition in the area, during peak weekend times, the
Company's casino in Ceska is often at full capacity which slows down the
games and, as a result, often lowers the hold percentages. In addition,
limitations of the casino's parking facilities (40 spaces) create another
obstacle for potential patrons, particularly now that a competing casino is
in the area. Although the overall attendance growth in Ceska was solid, the
improvement was limited by competition and capacity constraints, issues that
could curtail the growth of, or even erode, attendance in the future.

In response to these challenges, in April 1999, the Company purchased a
parcel of land in Folmova, nearer to the border than the turnoff road for the
Schoolhouse casino. The Company has installed pre-emptive signage on the land
advertising the Ceska casino and is planning to move the Ceska casino
operation to a new facility on this parcel of land. This move would give the
casino excellent exposure because it would be located directly on the border
road; would allow for a parking facility of ample size; would address the
issue of capacity constraints on the weekend in that it would allow for an
increase in the number of gaming tables over the existing space; and would
allow for a floor plan to be designed which, unlike the Ceska building, would
optimize the casino's equipment layout. There can be no assurance that the
relocation of the casino in Ceska will enhance future revenues.

ROZVADOV, CZECH REPUBLIC

The total revenue in Rozvadov was $1.8 million in the twelve months of
operation in 1999, representing a 36% increase over the nine months of
operation in 1998 ($1.3 million), which primarily is attributed to an
increase in attendance. The casino in Rozvadov opened in November 1997. Prior
to its acquisition in March 1998 by TWG, there was little advertising or
promotion for the casino and attendance was stagnant. In February 1999, TWG
hired a Director of Marketing and immediately launched a strong marketing
campaign which included direct mail and radio advertising in Germany as well
as themed parties and other promotional events. The result of the advertising
was a 148% increase in attendance. In fact, with this increase in attendance,
the limited space (7 tables) is unable to accommodate the peak time demand.
While this trend is positive, the potential drawback of the casino reaching
capacity in certain periods is that some regular attendees may be displaced.
In response, the Company has included plans to add two gaming tables to the
casino in its year 2000 Operating Budget.

With the improvements to client base in both Ceska and Rozvadov, the 2000
marketing programs will be directed at filling in the off-peak times and
improving the "quality" of the peak time players.

ZARAGOZA, SPAIN

Total revenue in CDZ in the year ended December 31, 1999 was $3.9 million,
which represents a 10% increase over the $3.5 million in revenue achieved in
1998. Despite a 25% erosion of the casino's attendance in 1999, the casino
managed to match the 1998 table game Win revenue of $2.4 million. This was
accomplished, primarily, through growth of the Drop per Head of the casino's
core clientele (i.e., catering to CDZ's preferred patrons). Due to CDZ's
location, laws preventing direct advertising of the casino, its high
operating and overhead costs, its limited number of guest rooms, and the poor
condition of other parts of the facility, the casino produced a Net Loss of
$1.9 million in 1999.

The aforementioned challenges will be difficult to overcome should the casino
remain in its present location. It was anticipated that a law that would be
passed which would allow the casino to move to a downtown location and, as a
result, would alter the business environment in which the casino operates.
This move would give the casino direct exposure to the residents of and
visitors to Zaragoza; would allow the casino to tailor the size of the
workforce to the operation; would reduce the operation's overhead costs; and
would allow the casino to increase the number of gaming tables and slot
machines to match the anticipated increase in demand. Under this scenario,
the disposition of the existing CDZ facility would be decided at the time of
the move.

The status of the intended move is as follows. An understanding has been
reached with an agency of the provincial government, the DGA, to allow the
casino to execute this move, subject to the issuance of a decree. However,
instead of a decree, in February 2000, the DGA introduced a law that would
allow the


                                       18
<PAGE>

casino to relocate. The law is expected to be presented to local Spanish
parliament in June 2000. The Company believes based on its discussions with
Spanish authorities, the law has little opposition and is expected to pass.

LIQUIDITY AND CAPITAL RESOURCES

The Company's working capital deficit, defined as current assets minus
current liabilities, increased $700,000 million to a deficit of $4.0 million
at December 31, 1999 from a working capital deficit at December 31, 1998 of
$3.3 million.

For the year ended December 31, 1999, the Company had net cash used in
continuing operations of $667,000. This was primarily a result of a
$6,187,000 loss from continuing operations, $2,839,000 of depreciation and
amortization, $542,000 of non-cash interest related to the amortization of
debt discount (recorded in connection with the warrants issued with March
1998 and October 1999 private placements) and a $2,139,000 net increase in
cash attributable to changes in operating assets and liabilities. For the
year ended December 31, 1999, the Company had net cash used in discontinued
operations of $197,000. For the year ended December 31, 1999, net cash used
in investing activities of $2,077,000 included the purchases or property and
equipment aggregating $2,422,000, payments for deposits of $34,000 and the
proceeds from the sale of Louisiana property aggregating $379,000. For the
year ended December 31, 1999, net cash provided by financing activities of
$2,110,000 included the proceeds from an October 1999 private placement of
$3,000,000 (see below) and a short-term obligation of $450,000, the
$1,000,000 repayment of an overdue short-term obligation to Value Partners,
$360,000 of repayments of other short-term obligations and the proceeds from
the exercise of warrants aggregating $20,000.

On March 31, 1998, the Company, with the assistance of Libra, acting as
placement agent, borrowed $17.0 million from fourteen investors in the
Private Placement. The loan is represented by the Senior Notes issued
pursuant to the Indentures by and among TWG, TWGI, TFC and USTCT, as the case
may be. The Indentures were amended on October 29, 1998 in connection with
the restructuring of the Company's ownership of Resorts as a result of the
change in the Czech gaming law which restricted foreign ownership of Czech
casinos. The Amended Indentures, however, did not alter the underlying basis
of the Senior Notes. The Senior Notes require mandatory prepayments based
upon excess cash flow generated by TWGI from the operation of the Czech
casinos acquired in the Resorts acquisition and bear interest at the rate of
12% per annum. The proceeds of the Senior Notes were used to pay the net
acquisition costs of, and improvements to, Resorts totaling $12.6 million, to
repay the First Amended Loan Agreement in the amount of $1.3 million, to
cover costs and expenses of $1.4 million relating to the Private Placement
and to provide working capital of $1.7 million. Interest payments under the
terms of the Senior Notes were paid when due on March 17, and September 17,
1999. The March 17, 2000 interest payment has also been paid, and the Company
was and is current on its payments under the Senior Notes.

On October 15, 1999, the Company borrowed $3.0 million ($2.7 million from
Value Partners) in the October 1999 Private Placement. The loan is
represented by the October 1999 Senior Notes issued pursuant to indentures by
and among the Company and an independent indenture trustee. The October 1999
Senior Notes, which are due March 2005, require mandatory prepayments based
on excess cash flow generated from Resorts. The October 1999 Senior Notes are
collateralized by primarily all of Resort's gaming equipment and a majority
interest in the capital stock of all of the Company's subsidiaries (except
CDZ). In addition to the October 1999 Senior Notes, each investor received a
proportionate share of warrants to purchase 1,250,728 shares of the Company's
Common Stock.

The proceeds of the October 1999 Senior Notes were used to retire a $1
million short-term debt obligation related to the acquisition of the CDZ
casino, to make an interest payment of approximately $250,000 on said debt,
and to finance the equipping, working capital, and pre-opening costs
associated with the opening of a third casino in the Czech Republic on land
that had been previously purchased. That casino, located near Snojmo, opened
on December 22, 1999.

The Company has, from time to time, been in technical default of the Amended
Indentures and has relied upon the forbearance and waivers from a majority
interest of the holders of the Senior Notes. Value


                                       19
<PAGE>

Partners represents a majority in interest of the holders of the Senior
Notes. The Company has borrowed other amounts from Value Partners from time
to time (some of which have been in technical default for which forbearance
or waivers have been granted) and may seek to borrow additional funds or
obtain equity investments from Value Partners in the future. At December 31,
1999, Value Partners owned 59% of the Company's long-term debt and owned
warrants to acquire 61.2% of the Company's issued and outstanding shares of
Common Stock.

In accordance with Spanish law, in order for a casino company to remain
solvent it must have a minimum capitalization of approximately $1.8 million
and such recapitalization required the approval of both the CDZ's Board of
Directors (received in July 1998) and the Council of Ministers in Spain
(received in October 1999). The owner of the remaining 10% of CDZ declined
to participate in the recapitalization and under Spanish law that 10%
interest was diluted to zero once the recapitalization was approved by the
Council of Ministers, bringing the total TWG ownership to 99.92%.

The Company estimates that approximately $5.0 million will be required to
execute the CDZ casino relocation, assuming permission is received from the
DGA for such move. An understanding had been reached with the DGA to allow
the casino to execute the move, subject to the issuance of a decree. However,
instead of a decree, in February 2000, the DGA introduced a law that would
allow the casino to relocate. The law is expected to be presented to local
Spanish parliament in June 2000. Management believes based on its discussions
with Spanish authorities, the law has little opposition and is expected to
pass.

During the years ended December 31, 1999 and 1998, DGA granted the Company a
deferral of approximately $1.8 million in taxes on gaming winnings accruing
during 1997-1999. Furthermore, in April 1999, the Company reached an
agreement with the Spanish Social Security Authorities to defer approximately
$1.2 million related to all debts generated in 1997 and the first quarter of
1998.

If the Company does not make its payments according to the receivership
schedule and is unable to obtain further deferral from the Spanish Taxing
Authorities, the debt would become immediately payable and revert to
pre-receivership levels. Management has indicated that, based on its
discussions with Spanish Taxing Authorities, further deferral of payments
until April 2001 is anticipated.

PLAN OF OPERATIONS

TWG management will continue to develop marketing and operational strategies
designed to increase attendance and revenues at its existing locations in the
Czech Republic and Spain. The Company has acquired land close to the German
border near Ceska Kubice, at Folmava, Czech Republic and is planning to build
a casino to replace the existing facility. Management believes that the new
location would be more accessible to its main target market in Germany and
will result in improved attendance and play. TWG transferred excess slot
machines from Ceska Kubice and Rozvadov to its new location near Snojmo.

IMPORTANT FACTORS TO CONSIDER

ACCUMULATED DEFICIT; OPERATING LOSSES; GOING CONCERN

On December 31, 1999, the Company had an accumulated deficit of approximately
$30.3 million and a working capital deficit of approximately $4 million. For
the year ended December 31, 1999, the Company incurred a net loss of
approximately $6.4 million. The ability of the Company to achieve
profitability depends upon the successful operation of gaming establishments
in the Czech Republic and Spain, their expansion and relocation, and the
diversification of its operations to include other sources of revenue. There
can be no assurance that the Company will achieve profitability as a result
of these operations or otherwise. The Company's independent public
accountants' have issued their report dated February 17, 2000 with an
explanatory paragraph relating to the Company's ability to continue as a
going concern.


                                       20
<PAGE>

TERMINATION OF LOUISIANA OPERATIONS IN 1999; NEED TO DIVERSIFY

In November 1996, residents in 35 parishes in Louisiana, including the two
parishes in which the Gold Coin and the Toledo Palace are located, voted to
discontinue video poker effective June 30, 1999. The Company is currently
involved in litigation to overturn the voter referendum. See Item 3. "Legal
Proceedings." No assurances can be given that such litigation will be
successful. At this time, the Company has operations in the Czech Republic
and Spain, but no U.S. gaming operations. The Company is currently seeking to
develop or acquire interests in gaming operations and hotels at other
locations; however, there can be no assurance that the Company will be able
to develop or acquire such new operations in the future.

TAXATION OF GAMING OPERATIONS

Gaming operators are typically subject to significant taxes and fees in
addition to federal and state corporate income taxes, and such taxes and fees
are subject to increase at any time. Any material increase in these taxes or
fees would adversely affect the results of operations of the Company. The
Czech Republic currently has a number of laws related to various taxes
imposed by governmental authorities. Applicable taxes include value added
tax, corporate tax, and payroll (social) taxes, together with others. In
addition, laws related to these taxes have not been in force for significant
periods, in contrast to more developed market economies; therefore,
implementing regulations are often unclear or nonexistent. Accordingly, few
precedents with regard to issues have been established. Often, differing
opinions regarding legal interpretations exist both among and within
government ministries and organizations, creating uncertainties and areas of
conflict. Tax declarations, together with other legal compliance areas (for
example, customs and currency control matters) are subject to review and
investigation by a number of authorities, who are enabled by law to impose
extremely severe fines, penalties and interest charges. These facts create
tax risks in the Czech Republic substantially more significant than typically
found in countries with more developed tax systems. Management believes that
it has adequately provided for tax liabilities; however, the risk remains
that relevant authority in the Czech Republic, and to a lesser extent as of
the date of this report in Spain could take differing positions with regard
to interpretive issues and the effect could be significant.

DEPENDENCE UPON KEY PERSONNEL

The Company's ability to successfully implement its strategy, manage the
Czech and Spanish casinos and maintain a competitive position will depend in
a large part on the ability of Rami S. Ramadan, the Company's newly-hired
Chief Executive Officer ("CEO") and Chief Financial Officer ("CFO"). Mr.
Ramadan has served as Executive Vice President of Finance for the Ian
Schrager Hotels and also held financial positions with Hyatt Hotels,
Euro-Disney and Meridien Hotels. The Company may also be highly dependent
upon other key employees, casino managers and consultants whom the Company
may retain from time to time. Although Mr. Ramadan has an employment
agreement with the Company that continues for an additional two years, there
can be no assurances that the Company will be able to continue to retain Mr.
Ramadan or any of such other personnel.

NEED FOR ADDITIONAL FINANCING

The Company believes, although there can be no assurance, that existing cash,
together with anticipated cash flows from operations, will be sufficient to
satisfy its current obligations for the next twelve months. However, the
Company will require additional capital for the relocation of the Ceska,
Rozvadov, and Zaragoza casinos as well as the expansion of the casino near
Snojmo and for growth opportunities. If such additional financing is not
available, this would have a materially adverse effect on the financial
condition and operations of the Company. The Company may require additional
debt and/or equity financing for the acquisition of other businesses when and
if an opportunity to acquire such businesses arises. The Company's ability to
obtain additional financing may be limited for a number of reasons, including
the fact that because the Company is highly-leveraged, a substantial portion
of the Company's assets are subject to liens. There can be no assurance that
such financing will be available on terms favorable to the Company or at all.


                                       21
<PAGE>

Because the Company is highly leveraged with debt, it is more vulnerable to
extended economic downturns and reduces the Company's ability to respond to
changing economic and industry conditions. This high leverage may adversely
impact the holders of the Company's equity securities by impairing the
Company's ability to obtain additional financing needed for working capital,
capital expenditures, acquisitions or general corporate purposes.

INTERNATIONAL ACTIVITIES

Since July 1, 1999, the Company's operations were totally outside of the
United States. Operating internationally involves additional risks relating
to such things as currency exchange rates, different legal or regulatory
environments, political and economic risks relating to the stability or
predictability of foreign governments, differences in the manner in which
different cultures do business, difficulties in staffing and managing foreign
operations, differences in financial reporting, operating difficulties,
different types of criminal threats and other factors. The occurrence of any
of these risks, if severe enough, could have a material adverse effect on the
financial condition or results of operations of the Company.

LICENSING AND REGULATION

The Company's operations are subject to regulation by each local jurisdiction
in which it operates or plans to operate business, as well as federal laws
and the laws of any foreign country. Each of the Company's officers, and
directors, and in certain instances, persons who have more than a 5% income
or profit interest in, or who exercise significant influence over the
activities of, the Company may be subject to strict scrutiny and approval
from the gaming commission or other regulatory body of each jurisdiction in
which the Company may conduct gaming operations.

The failure to obtain any license for properties upon which the Company plans
to operate or manage a gaming establishment in the future would have a
materially adverse effect on the Company's business. Obtaining required
licenses can be time consuming and costly with no assurance of success. In
addition, the Company is subject to changes in the laws of the jurisdictions
in which it operates, which could materially limit the Company's ability to
conduct business profitably. In the event that a required license is not
granted for any particular location, the Company's options would include
effecting a transfer of substantially all of its related gaming assets to a
different location or selling its interest in the gaming operations at that
location to a third party. There can be no assurance that the Company would
be able to relocate gaming assets or sell its interests on acceptable terms
or at all, and the inability to do so would have a materially adverse effect
upon the business and prospects of the Company.

LIABILITY INSURANCE

The Company currently maintains and intends to maintain general liability
insurance in each of those locations in which it operates. There can be no
assurance that liability claims will not exceed the coverage limits of such
policies or that such insurance will continue to be available on commercially
reasonable terms or at all. There can be no assurance that such insurance
will be adequate to cover unanticipated liabilities.

NO DIVIDENDS

The Company has not paid any dividends to date on its Common Stock, and does
not expect to declare or pay any dividends in the foreseeable future. The
Company intends to retain future earnings, if any are generated, for
investment in its business.

POSSIBLE ADVERSE EFFECT OF ISSUANCE OF PREFERRED STOCK

The Company's Articles of Incorporation authorize the issuance of 2,000,000
shares of "blank check" Preferred Stock, with designations, rights and
preferences determined from time to time by its Board of Directors.
Accordingly, the Company's Board of Directors is empowered, without further
stockholder approval, to issue Preferred Stock with dividend, liquidation,
conversion, voting or other rights that could


                                       22
<PAGE>

adversely affect the voting power or other rights of the holders of the
Common Stock. In the event of issuance, the Preferred Stock could be used,
under certain circumstances, as a method of discouraging, delaying or
preventing a change in control of the Company. The Company has no current
plans to issue any shares of Preferred Stock. However, there can be no
assurance that Preferred Stock will not be issued at some time in the future.

DILUTIVE EFFECT OF WARRANTS

In March 1998, in connection with the completion of the Private Placement,
the Company issued warrants to purchase approximately 9.5 million shares of
the Company's Common Stock. In addition, in connection with the restructuring
of the Senior Bonds, in March 1998 the Company issued approximately 3.2
million warrants to purchase the Company's Common Stock. The Company also
issued approximately 1.25 million warrants to purchase the Company's Common
Stock in connection with the October 1999 Private Placement. The issuance of
such securities will have a dilutive effect on the Company's earnings, if any
are generated, on a diluted basis. Together these warrants represented at
December 31, 1999, 260% of the Company's issued and outstanding shares of
Common Stock.

ITEM 7.  FINANCIAL STATEMENTS.

The following items are included in this Report:

         Consolidated Financial Statements

<TABLE>

         <S>                                                                                            <C>
         Index to Consolidated Financial Statements.......................................................43
         Independent Auditors' Report....................................................................F-1
         Consolidated Balance Sheet......................................................................F-2
         Consolidated Statements of Operations and Comprehensive Loss....................................F-3
         Consolidated Statements of Stockholders' Deficit................................................F-4
         Consolidated Statements of Cash Flows...........................................................F-5
         Notes to Consolidated Financial Statements......................................................F-7
         Audit Report for Casino de Zaragoza............................................................F-24

</TABLE>

ITEM 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE.

Pannell Kerr Forster PC ("PKF") completed the Company's audit for the year
ended December 31, 1997. In August, 1998, PKF informally indicated that it did
not wish to act as the Company's independent auditor for the year ended
December 31, 1998 and that it would decline to stand for reelection to audit
the Company's financial statements for the year ended December 31, 1998 for
which PKF tendered its formal resignation on February 25, 1999 to the Company
without having performed an audit for the Company's year ended December 31,
1998.

Upon receipt of notice from PKF that it would resign and not stand for
reelection as the Company's independent accountant, the Company began its
search for a new independent accountant in September 1998. On February 19,
1999, the Company and Rothstein Kass & Company, P.C. ("RKC") signed a letter
of engagement whereby RKC agreed to perform an audit of the Company for the
year ended December 31, 1998.

Prior to the date of engagement of RKC, the Company had not consulted with RKC
regarding the application of accounting principles to a specified transaction
or the type of audit opinion that might be rendered on the Company's financial
statements.

The decision to accept the engagement of RKC as the Company's independent
accountant was recommended by the Audit Committee and approved by the Board of
Directors of the Company. At the October 29, 1999 Annual Meeting of the
Company, the appointment of RKC was ratified by the Company's shareholders.


                                       23
<PAGE>

PART III

ITEM 9.  DIRECTORS AND EXECUTIVE OFFICERS,  PROMOTERS AND CONTROL PERSONS;
             COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT.

The following table provides information as of March 31, 2000 with respect to
each of the Company's directors and each Executive Officer:

<TABLE>
<CAPTION>

------------------------------------------------------------------------------------------------------------


Name                                   Age     Position in the Company          Director or Executive Since
------------------------------------------------------------------------------------------------------------
<S>                                    <C>     <C>                              <C>

Rami S. Ramadan(1)...............      50      CEO, CFO and Director                         1999


Andrew Tottenham(1)..............      42      President, Chief Operating                    1996
                                               Officer and Director


Julio E. Heurtematte, Jr.(2).....      64      Director                                      1998


Malcolm M.B. Sterrett(2).........      57      Director                                      1998


Geoffrey Baker(2,3)..............      51      Director                                      1999
------------------------------------------------------------------------------------------------------------
</TABLE>

(1)      Member of the Executive Committee.
(2)      Member of Audit Committee and Compensation Committee.
(3)      Mr. Geoffrey Baker, who was appointed to a fill a vacancy on the Board
         of Directors on December 22, 1998, resigned from his position on May
         13, 1999 and rejoined the Board on August 4, 1999.

         Dominick J. Valenzano resigned on July 12, 1999 from his position as
CFO of the Company, to pursue other business interests.

         Stanley Kohlenberg resigned on June 30, 1999 from has position as
CEO, but remained as Chairman, until February 8, 2000.

         RAMI S. RAMADAN has served as CEO/CFO since July 12, 1999. His most
recent prior position had been Executive Vice President of Finance for the Ian
Schrager Hotels from November 1997 to July 1999. Prior to that, Mr. Ramadan
held senior financial positions with Hyatt Hotels from January 1994 to
November 1997, Euro Disney from October 1990 to December 1993 and Meridien
Hotels from September 1975 to September 1990.

         ANDREW TOTTENHAM was appointed as President and CEO of the Company on
January 1, 1997 and served in such capacities until September 1998 when he was
appointed to the offices of President and COO. Mr. Tottenham was a consultant
to the Company from July 1996 to December 31, 1996 and has been a director of
the Company since May 1996. He has been the President of Tottenham & Co. since
1988. Mr. Tottenham commenced his career in the gaming industry in 1975 and
has worked for the Silhouette Club,


                                       24
<PAGE>

Bally's Park Place, Connoisseur Club, and Victoria Casino. Mr. Tottenham is
the son-in-law of Mr. Kohlenberg.

         JULIO E. HEURTEMATTE, JR. Mr. Heurtematte currently is a private
consultant, specializing in international projects, trade and investments and
has acted in such capacity since 1989. From 1963 to 1989, Mr. Heurtematte
served with the Inter-American Development Bank in several capacities, most
recently as its Deputy Manager for Project Analysis.

         MALCOLM M. B. STERRETT. Mr. Sterrett is a private investor. From 1989
to 1993, he was a partner at the law firm of Pepper Hamilton & Scheetz,
Washington, D.C. From 1988 to 1989, he served as General Counsel to the U.S.
Department of Health and Human Services and from 1982 to 1988 he was a
Commissioner on the U.S. Interstate Commerce Commission. Prior thereto, he was
Vice President and General Counsel to the United States Railway Association
and served as Staff Director and Counsel to the U.S. Senate Committee on
Commerce, Science and Transportation.

         GEOFFREY B. BAKER. Mr. Baker is a private investor. From 1983 to the
present, Mr. Baker has been a member of the private investment firm, Baker &
Donaldson. From 1977 to 1982, he was Legislative Director to U.S. Senator
Lowell P. Weicker, Jr. and from 1975 to 1977, he served on the Senate
Committee on Commerce as a minority staff member for surface transportation.

INFORMATION ABOUT THE BOARD AND ITS COMMITTEES

The business and affairs of the Company are managed by the Company's Board of
Directors. Meetings of the Board are held quarterly and on an as-needed basis.
The Board has established several committees, described below, which also meet
on an as-required basis during the year. The Board held six meetings during
the Company's fiscal year ended December 31, 1999. No director of the Company
attended fewer than 75% of the total number of meetings of the Board or
meetings of committees of the Board during the year ended December 31, 1999.

The Board of Directors has established the following committees:

AUDIT COMMITTEE. The Audit Committee reviews and approves internal accounting
controls, internal audit operations and activities, the Company's annual
report and audited financial statements, the selection of the Company's
independent auditors, the activities and recommendations of the Company's
independent auditors, material changes in the Company's accounting procedures,
the Company's policies regarding conflicts of interest and such other matters
as may be delegated by the Board. The Audit Committee, composed of Messrs.
Baker, Heurtematte and Sterrett, all non-employee directors, met once in 1999.

EXECUTIVE COMMITTEE. The Executive Committee recommends a list of potential
director nominees to the Board of the Company, develops guidelines for
corporate structuring and Board-related issues and acts as an oversight
committee. Although the Executive Committee will consider nominees recommended
by the Company's shareholders, it has neither actively solicited nominations
nor established any procedures for this purpose. The Executive Committee,
composed of Messrs. Ramadan and Tottenham, met once during 1999.

 COMPENSATION COMMITTEE. The Compensation Committee sets the compensation for
executive officers of the Company and sets the terms of grants of awards under
the Company's 1993 Incentive Stock Option Plan (the "1993 Plan"), the
Company's 1998 Stock Option Plan (the "1998 Plan"), the 1999 Non-Employee
Director Stock Option Plan and any other equity-based compensation plans
adopted by the Company. The Compensation Committee, composed of Messrs. Baker,
Heurtematte and Sterrett, met once during 1999.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Exchange Act requires the Company's officers, directors
and persons who own more than 10% of the Company's Common Stock to file
reports of ownership and changes in ownership with SEC and the National
Association of Securities Dealers, Inc. by certain dates. The Company believes
that

                                       25

<PAGE>

in the fiscal year ended December 31, 1999, these filing requirements were not
satisfied by its directors and executive officers. For the year ended December
31, 1999, Geoffrey Baker, Julio Heurtematte, Malcolm Sterrett, Maureen
Weppler, Stanley Kohlenberg, Dominick Valenzano and Andrew Tottenham each were
late once in reporting one transaction; each of which were subsequently filed.
In making the foregoing statements, the Company has relied on representations
of its directors and executive officers and copies of the reports that they
have filed with the SEC. The Company knows of no person who owns 10% or more
of the Company's Common Stock.

ITEM 10.      EXECUTIVE COMPENSATION.

SUMMARY OF CASH AND CERTAIN OTHER COMPENSATION

The following table sets forth the cash and non-cash compensation paid or
earned during the fiscal years ending December 31, 1999, 1998, and 1997 by the
Chief Executive Officer(s) and Chief Financial Officer of the Company (the
"Named Officers") during those periods.

<TABLE>
<CAPTION>

                           SUMMARY COMPENSATION TABLE
--------------------------------------------------------------------------------------------------------------------------
                                                                                                           LONG-TERM
                                                                                                         COMPENSATION
--------------------------------------------------------------------------------------------------------------------------
                                                                        OTHER ANNUAL    STOCK               ALL OTHER
                                     YEAR     SALARY     BONUS(4)       COMPENSATION    OPTIONS(5)       COMPENSATION(6)
<S>                                  <C>     <C>         <C>            <C>             <C>              <C>

Rami Ramadan                         1999    $150,000                                    100,000            $ 2,200
       Chief Executive Officer
       Chief Financial Officer(1)

Andrew Tottenham                     1999     195,000
       President and Chief           1998     180,000                                     25,000              9,000
       Executive Officer(2)          1997     150,000    $60,000         $100,000          8,600

Stanley Kohlenberg                   1999     180,000
       Former President and          1998      43,750                                     25,000             42,500
       Chief Executive Officer(3)    1997

Dominick J. Valenzano                1999     120,000
       Former Chief Financial        1998     120,000                                     25,000              4,300
       Officer(7)                    1997      90,000     30,000                          50,000              6,360

--------------------------------------------------------------------------------------------------------------------------
</TABLE>

(1)     Mr. Ramadan joined the Company as its CEO and CFO, July 12, 1999.
(2)     Mr. Tottenham was elected President and CEO of the Company as of
        January 1, 1997 and became President and COO on September 16, 1998.
(3)     Mr. Kohlenberg served as President and CEO of the Company from March 6,
        1996 to December 31, 1996 and again from September 16, 1998 to June 30,
        1999, the date of his resignation. Under the terms of a severance
        agreement dated May 23, 1999, Mr. Kohlenberg received six months salary
        and will participate in the Company's health plan for that period.
(4)     Bonus amounts shown were earned with respect to each year indicated.
(5)     Amounts shown represent the number of qualified stock options granted
        each year. With the exception of Mr. Valenzano's options which have
        expired, options listed are exercisable; all of the options, at
        December 31, 1999, were issued at the fair market value of one share of
        the Company's Common Stock on the date of grant.
(6)     The amounts shown represent the cost of a leased automobile provided to
        Messrs. Tottenham, Valenzano and Ramadan (received Mr. Valenzano's car
        on September 1, 1999) by the Company


                                       26
<PAGE>

        for each year indicated and represent a consulting fee paid to Mr.
        Kohlenberg under the terms of a Consulting Agreement which terminated
        on September 15, 1998.
(7)     Mr. Valenzano resigned from the Company on August 5, 1999. Under the
        terms of a severance agreement, executed on August 5, 1999, Mr.
        Valenzano received six months salary and participated in the Company's
        health plan for six months following such termination.

OPTION GRANTS AND EXERCISES

The following table summarizes certain information concerning individual grants
of options during fiscal 1999 to the executive officers named in the Summary
Compensation Table above and the potential realizable value of the options held
by such persons at December 31, 1999.

<TABLE>
<CAPTION>

                         OPTIONS GRANTED IN FISCAL 1999
                                INDIVIDUAL GRANTS
-------------------------------------------------------------------------------------------------------------------
                                                         % OF TOTAL OPTIONS
                                   SHARES OF COMMON      GRANTED TO
                                   STOCK UNDERLYING      EMPLOYEES IN FISCAL   EXERCISE OF BASE          EXPIRATION
                                   OPTIONS GRANTED       YEAR                  PRICE ($/SH)              DATE
-------------------------------------------------------------------------------------------------------------------
<S>                                <C>                   <C>                   <C>                       <C>

RAMI S. RAMADAN..............      100,000                    100%                      0.50              07/30/08
-------------------------------------------------------------------------------------------------------------------
</TABLE>

        No options were exercised by the executive officers named in the
Summary Compensation Table during fiscal 1999.

        The following table summarizes the option values held by the executive
officers named in the Summary Compensation Table as of December 31, 1999.

                  AGGREGATE OPTION EXERCISES IN FISCAL 1999 AND
                     FISCAL 1999 YEAR-END OPTION VALUE TABLE

<TABLE>
<CAPTION>

------------------------------------------------------------------------------------------------------------------
                                      NUMBER OF UNEXERCISED OPTIONS        VALUE OF UNEXERCISED IN-THE-MONEY
                                      AT DECEMBER 31, 1999                 OPTIONS AT DECEMBER 31, 1999
------------------------------------------------------------------------------------------------------------------
                            SHARES
NAME                        ACQUIRED     EXERCISABLE    UNEXERCISABLE      EXERCISABLE        UNEXERCISABLE
                            ON
                            EXERCISE
<S>                         <C>          <C>            <C>                <C>                <C>

RAMI S. RAMADAN                                100,000        0                 0                    0

STANLEY KOHLENBERG                             137,000        0                 0                    0

ANDREW TOTTENHAM                               127,000        0                 0                    0

DOMINICK J. VALENZANO                          145,000        0                 0                    0
-----------------------------------------------------------------------------------------------------------------
</TABLE>


DIRECTORS' COMPENSATION

Directors receive a cash fee of $2,000 for each meeting attended and all
members of the Board are reimbursed for out-of-pocket expenses in connection
with attending Board meetings. Pursuant to the 1999 Non-Employee Director
Stock Option adopted at the October 29, 1999 Annual Meeting, each non-employee
director is provided with an automatic grant of a non-qualified option to
purchase 2,000 shares of Common Stock on the date following each fiscal
quarter in which the director serves. Each such option (i)


                                       27
<PAGE>

has a ten-year term, (ii) has an exercise price per share equal to 100% of the
fair market value of one share of Common Stock on the date of grant, and (iii)
becomes fully exercisable on the date of grant.

EMPLOYMENT/SEVERANCE AGREEMENTS

RAMI S. RAMADAN. Effective July 12, 1999, the Company entered into a three
year employment agreement with Mr. Ramadan pursuant to which he will serve as
the Company's Chief Executive Officer and Chief Financial Officer at an annual
salary of $300,000. Mr. Ramadan is eligible to participate in the 1998 Plan,
Executive Compensation Plan and any present or future employee benefit plans.
He also will be reimbursed for reasonable travel and out-of-pocket expenses
necessarily incurred in the performance of his duties. Mr. Ramadan will also
receive three separate equal annual installments of options to acquire the
Company's Common Stock, each of which shall have a five-year term commencing
upon the date on which each installment is granted. Upon commencement of the
employment agreement, Mr. Ramadan received 100,000 options exercisable at
$0.50 per share; upon commencement of the second year of the employment
agreement an additional 100,000 options exercisable at $0.55 per share will be
granted; and upon commencement of the third year of the employment agreement
the final installment of 100,000 options exercisable at $0.61 per share will
be granted. Upon commencement of the second and third year of the employment
agreement, the exercise price for all unexercised options granted in the
preceding year will be increased to the current year's exercise price up to
$0.61. In the event the employment agreement is terminated other than for
cause, as defined in the agreement, within six months of the commencement
date, the Company shall pay to Mr. Ramadan one year's salary in a lump sum
within 30 days of the notice of termination. If the agreement is terminated
other than for cause at anytime after six (6) months following commencement of
the employment agreement, Mr. Ramadan will receive two years' salary.

ANDREW TOTTENHAM. Effective as of January 1, 1997, the Company entered into a
five-year employment agreement with Mr. Tottenham pursuant to which he serves
as the Company's President and Chief Operating Officer at an annual salary of
$150,000. On June 1, 1999, Mr. Tottenham's salary was increased to $180,000
and on November 1, 1999, it was increased to $200,000. Mr. Tottenham will be
eligible for participation in the Company's 1993 Plan, 1998 Plan, the
Executive Compensation Plan, and any present or future employee benefit plans.
He also will be reimbursed for reasonable travel and out-of-pocket expenses
necessarily incurred in the performance of his duties. Mr. Tottenham works
from the Company's offices in London, England. The Company is entitled to
terminate Mr. Tottenham's employment, and its salary obligation to him, upon
30 days written notice in the event of (i) disability (assuming there is
disability insurance sufficient to pay Mr. Tottenham his full salary for the
remaining term of the employment agreement), (ii) conviction of a felony, or
(iii) a breach of the employment agreement. If Mr. Tottenham dies during the
term of the employment agreement, his estate is entitled to three months'
salary at his base salary rate on the date of death. If Mr. Tottenham is
terminated for any other reason, he is entitled to three months' severance pay
at his base salary rate in effect on the date of such termination.

STANLEY KOHLENBERG. Effective July 12, 1999, the Company and Mr. Kohlenberg
entered into a severance agreement, pursuant to which Mr. Kohlenberg resigned
as Chief Executive Officer of the Company on June 30, 1999. Mr. Kohlenberg
received severance payments equal to six (6) months salary and continued to
participate in the Company's benefit plans for six (6) months. Mr. Kohlenberg
continued to serve as Chairman of the Company's Board of Directors until his
resignation on February 8, 2000.

DOMINICK J. VALENZANO. The Company and Mr. Valenzano executed a severance
agreement on August 5, 1999 pursuant to which Mr. Valenzano resigned as Chief
Financial Officer of the Company. Mr. Valenzano received severance payments
equal to six (6) months salary and continued to participate in the Company's
benefit plans for six (6) months.

ITEM 11.   SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

         The following table sets forth information regarding the beneficial
ownership of the Common Stock as of March 31, 2000, unless otherwise noted,
(a) by each shareholder who is known by the Company to own beneficially more
than 5.0% of the outstanding Common Stock, (b) by each director, (c) by each
executive officer named in the Summary Compensation Table below, and by all
executive officers


                                       28
<PAGE>

and directors as a group. Unless otherwise noted, each of the shareholders
listed in the table or included within a group listed in the table possesses
sole voting and investment power with respect to the shares indicated subject
to community property laws where applicable. The business address for each
director and officer of the Company is 545 Fifth Avenue, Suite 940, New York,
New York 10017.

<TABLE>
<CAPTION>

------------------------------------------------------------------------------------------------------------

                                                             Number of Shares of Common      Percentage of
Name of Beneficial Owner                                     Stock Beneficially Owned(1)      Ownership(1)
------------------------------------------------------------------------------------------------------------
<S>                                                          <C>                             <C>

Value Partners, Ltd...........................                             8,257,452(2)               60.6%
Anasazi Partners Limited Partnership..........                             1,135,667(3)               17.5%
Fort Pitt Fund III, L.P.......................                               312,682(4)                5.5%
Ravich Children Permanent Trust............                                1,250,727(5)               18.9%
C.P. Baker & Co., Ltd.........................                             3,186,037(6)               39.4%
U.S. Bancorp..................................                               681,647(7)               11.2%
Stanley Kohlenberg............................                               237,000(8)                4.2%
Andrew Tottenham..............................                             1,205,500(9)               18.3%
Rami S. Ramadan...............................                               100,000(10)                  *
Julio Heurtematte.............................                                54,961(11)                  *
Malcolm M.B. Sterrett.........................                                54,961(12)                  *
Geoffrey B. Baker.............................                                50,961(13)                  *
All directors and executive officers as a
         group (5 persons)....................                             1,466,383(14)              24.4%

*        Less than 1%.
--------------------------------------------------------------------------------------------------------------
</TABLE>

(1)   The percentage of outstanding shares is based on 5,365,449 shares
      outstanding as of May 10, 2000 (the "Calculation Date") and, for certain
      individuals and entities, on reports filed with the Securities and
      Exchange Commission ("SEC"). A person is deemed to be the beneficial
      owner of securities that can be acquired by such person within 60 days
      from the Calculation Date upon the exercise of options or warrants. Each
      beneficial owner's percentage ownership is determined by assuming that
      options or warrants that are held by such person (but not those held by
      any other person) are exercisable within 60 days from the date of the
      Voting Record Date have been exercised. Included are shares of Common
      Stock issuable upon the exercise of options or warrants to purchase the
      Company's Common Stock.

(2)   Value Partners, Ltd. is a Texas limited partnership, whose business
      address is 4514 Cole Avenue, Suite 808, Dallas, Texas 75205. Includes
      warrants to purchase: 600,000 shares of Common Stock at an exercise price
      of $1.00, expiring December 31, 2005; 2,000,000 shares of Common Stock at
      an exercise price of $1.50 per share, expiring December 31, 2005;
      4,427,573 shares of Common Stock at an exercise price of $.01 per share,
      expiring March 31, 2008 (of these warrants 675,392 were acquired from
      Credit Suisse First Boston Management Corporation in October 1999);
      104,225 shares of Common Stock at an exercise price of $.01 per share
      expiring March 31, 2008; and 1,125,654 shares of Common Stock at an
      exercise price of $.01 per share, expiring March 31, 2008.

(3)   Anasazi Partners, Ltd. is a Massachusetts limited partnership whose
      business address is 120 Boylston Street, Suite 800, Boston, Massachusetts
      02116. Includes 269,000 shares of Common Stock purchased in the Company's
      initial public offering ("IPO"); and warrants to purchase 200,000 shares
      of Common Stock at an exercise price of $1.00 per share, expiring
      December 31, 2005 (of these warrants, 50,000 were acquired from New
      Generation, Ltd. in 1999), and 666,667 shares of Common Stock at an
      exercise price of $1.50 per share, expiring December 31, 2005).

(4)   The business address for Fort Pitt Fund III, L.P. is P.O. Box 974,
      Uniontown, Pennsylvania 15401. Includes warrants to purchase 312,682
      shares of Common Stock at an exercise price of $.01 per share expiring
      March 31, 2008.


                                       29
<PAGE>

(5)   The business address for the Ravich Children's Permanent Trust is 8730
      Wilshire Blvd., Beverly Hills, California 90021.

(6)   The business address for C.P. Baker & Co. is 120 Boylston Street, Suite
      800, Boston, Massachusetts 02116. Includes: 183,500 shares of Common
      Stock of which Mr. Baker is the record holder; 10,000 shares of stock of
      which C.P. Baker & Company, Ltd., an affiliate of Mr. Baker, holds of
      record; warrants to purchase 1,723,570 shares of Common Stock at an
      exercise price of $0.01, expiring June 30, 2002, that may be exercised by
      Mr. Baker and/or his affiliates, C. P. Baker & Company, Ltd. and C. P.
      Baker Venture Fund I; 269,000 shares of Common Stock of which Anasazi
      Partners, an affiliate of Mr. Baker, holds of record; warrants to
      purchase 200,000 shares of Common Stock at an exercise price of $1.00,
      expiring December 31, 2005, that may be exercised by Anasazi Partners;
      and warrants to purchase 666,667 shares of Common Stock at an exercise
      price of $1.50, expiring December 31, 2005, that may be exercised by
      Anasazi Partners. See also note (3) above.

(7)   The business address for U.S. Bancorp. is 11766 Wilshire Boulevard, Suite
      870, Los Angeles, California 90025. Represents warrants to purchase
      681,647 shares of Common Stock at an exercise price of $.01 per share,
      expiring March 31, 2008, which were acquired from Credit Suisse First
      Boston Management Corporation in October 1999.

(8)   Includes 1,000 shares issued on May 22, 1995; 25,000 shares issued on
      March 07, 1996; and 1,000 shares issued at the end of each quarter for
      the quarter ended March 31, 1997 through the quarter ended September 30,
      1998 subject to non-qualified options granted to Mr. Kohlenberg under the
      1993 Plan as well as 75,000 shares and 25,000 shares of Common Stock,
      subject to incentive options granted to Mr. Kohlenberg on December 31,
      1996 and December 31, 1998, respectively all of which fully vested on the
      dates of grant. Also includes 2,000 shares issued at the end of the
      quarter for the quarter ended September 30, 1999 through the quarter
      ended December 31, 1999 subject to non-qualified options granted to Mr.
      Kohlenberg under the 1998 Plan all of which fully vested on the dates of
      grant. Does not include 929,500 shares (187,500 of which are immediately
      exercisable warrants and 107,000 of which are immediately exercisable
      options) held be Andrew Tottenham, a son-in-law of Mr. Kohlenberg, as to
      which beneficial ownership is disclaimed.

(9)   Includes 623,500 shares of Common Stock (240,000 shares were issued to
      Mr. Tottenham upon conversion of the Tottenham Notes on December 31,
      1998) and 1,000 shares and 1,000 shares subject to non-qualified options
      granted to Andrew Tottenham under the 1993 Plan on October 2, 1996 and on
      December 31, 1996, respectively, and 100,000 shares and 25,000 shares
      subject to incentive options granted to Mr. Tottenham on December 31,
      1997 and December 31, 1998 respectively, all of which fully vested on the
      dates of grant. Also includes 187,500 shares subject to immediately
      exercisable warrants which were granted to Mr. Tottenham on January 1,
      1997. Also includes 205,000 shares of Common Stock owned by Robin
      Tottenham (80,000 shares were issued to Mrs. Tottenham upon conversion of
      the Tottenham Notes on December 31, 1998), the wife of Mr. Tottenham and
      the daughter of Mr. Kohlenberg, and 62,500 shares subject to immediately
      exercisable warrants that were granted to Mrs. Tottenham on January 1,
      1997. Does not include shares owned by Mr. Kohlenberg, as set forth
      above, as to which beneficial ownership is disclaimed.

(10)  Consists of shares subject to incentive options granted to Mr. Ramadan on
      July 12, 1999, all of which fully vested on the date of grant.

(11)  Includes warrants to purchase 41,961 shares of Common Stock at an
      exercise price of $.01 per share expiring March 31, 2008; 1,000 shares of
      Common Stock subject to non-qualified options granted to Mr. Heurtematte
      under the 1998 Plan at the end of each calendar quarter ended March 31,
      1998 through December 31, 1998 and 2,000 shares of Common Stock subject
      to non-qualified options granted under the 1999 Director Plan at the end
      of each calendar quarter ended March 31, 1999 through March 31, 2000, all
      of which fully vested on the dates of grant.

(12)  Includes warrants to purchase 41,961 shares of Common Stock at an
      exercise price of $.01 per share expiring March 31, 2008; 1,000 shares of
      Common Stock subject to non-qualified options granted to Mr. Sterrett
      under the 1998 Plan at the end of each calendar quarter ended March 31,
      1998 through December


                                       30
<PAGE>

      31, 1998 and 2,000 shares of Common Stock, subject to non-qualified
      options, granted under the 1999 Director Plan at the end of each calendar
      quarter ended since March 31, 1999 through March 31, 2000, all of which
      fully vested on the dates of grant.

(13)  Includes warrants to purchase 41,961 shares of Common Stock at an
      exercise price of $.01 per share expiring March 31, 2008; 1,000 shares of
      Common Stock subject to non-qualified options granted to Mr. Baker under
      the 1993 Plan at December 31, 1998, 2,000 shares of Common Stock, subject
      to non-qualified options, granted under the 1999 Director Plan for the
      calendar quarter ended March 31, 1999 and 2,000 shares of Common Stock
      subject to non-qualified options granted under the 1999 Director Plan at
      the end of each quarter ended since September 31, 1999 through March 31,
      2000, all of which fully vested on the dates of grant.

(14)  See Notes  (9), (10), (11), (12), and  (13) above.

ITEM 12.     CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

TOTTENHAM & CO. On January 1, 1997, the Company completed the acquisition of
Tottenham & Co. which was founded in 1988 by Andrew Tottenham, the Company's
President and COO and is engaged in providing consulting services to gaming
companies worldwide. The consideration paid for Tottenham & Co. by the Company
included 500,000 shares of the Company's Common Stock, and warrants to
purchase 250,000 shares at an exercise price of $.5938, the bid price of the
Company's Common Stock on the date of the acquisition as reported by the
Nasdaq SmallCap Market System. In addition, the Company issued two promissory
notes in the aggregate principal amount of $200,000 bearing interest at the
rate of 10% per annum and payable on January 1, 2002 (the "Tottenham Notes").
On December 31, 1998, the Company and Andrew Tottenham converted the Tottenham
Notes and accrued interest totaling $240,000 into 320,000 shares of the
Company's Common Stock. All of the Common Stock, as well as the Common Stock
underlying the warrants, carries certain "piggyback" registration rights.

CHRYSOLITH OPERATING AGREEMENT. The Company is a member under, and party to,
which sets forth the rights and obligations of the original members, all of
whom are individuals (the "Original Members"), and the Company. Under this
agreement, Chrysolith operated, serviced and maintained the VLTs at the Gold
Coin and Toledo Palace and the Company provided management, financial and
consulting services. The Chrysolith Operating Agreement will continue pending
the decision of the U.S. Supreme Court regarding the Company's appeal of the
termination of the operations at the Gold Coin and Toledo Palace.

MONARCH ACQUISITION. In April 1994, the Company acquired for $49,000 a 49%
ownership interest in Monarch Casinos ("Monarch"), a Louisiana-licensed video
gaming device operator which was founded in December 1993. In June and August
1994, the Company loaned Monarch an aggregate of $55,000 for working capital
to manage the operations of the Woodlands under an agreement between Monarch
and the previous owner of the Woodlands. All of such loans were payable on
demand, bore interest at the rate of 10% and were evidenced by promissory
notes executed by Monarch. In October 1994, the Company credited Monarch
$25,000 against prior advances, among other things, in consideration for the
assignment by Monarch to the Company of an option to purchase the Woodlands.
Although it was originally intended that Monarch would own, operate and
maintain the VLTs at both the Toledo Palace and the Gold Coin, the Company
believed that Chrysolith was better suited to operate the video poker parlors
and thus entered into the Chrysolith Agreement. In March 1996, the Company
learned that as of June 30, 1995, Monarch had not renewed its operator's
license as required by the State of Louisiana, and as such, was no longer a
licensed video poker operator in the State. Pursuant to the management
agreements between Monarch and the Company, such a failure to renew or other
termination of the operator's license created a default under the agreements
and the agreements were terminated by the Company on March 14, 1996. On or
about November 6, 1997 Monarch and Michael Edwards, President of Monarch,
filed suit against the Company alleging, among other things, breach of
contract. The lawsuit was settled in May 1999 for a cash payment by the
Company of $100,000 and both parties released the other of any and all further
obligations. See Item 3. "Legal Proceedings".


                                       31
<PAGE>

On October 29, 1997, the Company and Value Partners executed a loan which was
amended on December 19, 1997, under which TWG had the ability to borrow up to
$2,538,000 (the "First Amended Loan Agreement"). As of December 31, 1998, the
Company had borrowed $1,538,000 under this loan, including the Bishkek Note
described below, of which $1,288,000 was repaid on March 31, 1998 from the
proceeds of the Private Placement.

On March 19, 1998, the Company and Value Partners executed a Lender's Waiver
and Option Agreement (the "Waiver") under which the Company borrowed $250,000
(the "Bishkek Note") to fund the Bishkek Casino transaction. In February 1999,
the Company repaid the principal and accrued interest on the Bishkek Note in
full, and it was cancelled.

On March 31, 1998, the Company, with the assistance of Libra, acting as
placement agent, borrowed $17.0 million from fourteen investors in the Private
Placement. The loan is represented by the Senior Notes issued pursuant to the
Indentures by and among TWG, TWGI, TFC and USTCT, as the case may be. The
Indentures were amended on October 29, 1998 in connection with the
restructuring of the Company's ownership of Resorts as a result of the change
in the Czech gaming law which restricted foreign ownership of Czech casinos.
The Amended Indentures, however, did not alter the underlying basis of the
Senior Notes. The Senior Notes require mandatory prepayments based upon excess
cash flow generated by TWGI from the operation of the Czech casinos acquired
in the Resorts acquisition and bear interest at the rate of 12% per annum. The
proceeds of the Senior Notes were used to pay the net acquisition costs of,
and improvements to, Resorts totaling $12.6 million, to repay the First
Amended Loan Agreement in the amount of $1.3 million, to cover costs and
expenses of $1.4 million relating to the Private Placement and to provide
working capital of $1.7 million. Interest payments under the terms of the
Senior Notes were paid when due on March 17, and September 17, 1999. The March
17, 2000 interest payment has also been paid, and the Company was and is
current on its payments under the Senior Notes.

On May 19, 1998, the Company and Value Partners executed a Loan Agreement (the
"Value Partners Loan") under which the Company borrowed $1,000,000 at 12%
interest per annum to fund the purchase of the stock of the CDZ (see - "Plan
of Operations").

The Company was in technical default of, and had not timely paid the Value
Partners Loan which was due on September 15, 1998. The interest rate
automatically increased to 17% on September 15, 1998. On July 30, 1999, the
Company received from Value Partners a waiver of such default and a waiver of
the cross defaults on the Amended Indentures by the majority in interest of
the holders of the Senior Notes. Value Partners also granted an extension of
this loan until January 1, 2000, which had been accruing since September 1998
until the debt was satisfied in October 1999. (See below).

On October 15, 1999, the Company borrowed $3.0 million ($2.7 million from
Value Partners) in the October 1999 Private Placement. The loan is represented
by the October 1999 Senior Notes issued pursuant to indentures by and among
the Company and an independent indenture trustee. The October 1999 Senior
Notes, which are due March 2005, require mandatory prepayments based on excess
cash flow generated from Resorts. The October 1999 Senior Notes are
collateralized by primarily all of Resort's gaming equipment and a majority
interest in the capital stock of all of the Company's subsidiaries (except
CDZ). In addition to the October 1999 Senior Notes, each investor received a
proportionate share of warrants to purchase 1,251,000 shares of the Company's
Common Stock.

The proceeds of the October 1999 Senior Notes were used to retire a $1 million
short-term debt obligation related to the acquisition of the CDZ casino, to
make an interest payment of approximately $250,000 on said debt, and to
finance the equipping, working capital, and pre-opening costs associated with
the opening of a third casino in the Czech Republic on land that had been
previously purchased. That casino, located near Snojmo, opened on December 22,
1999.

The Company has, from time to time, been in technical default of the Amended
Indentures and has relied upon the forbearance and waivers from a majority
interest of the holders of the Senior Notes. Value Partners represents a
majority in interest of the holders of the Senior Notes. The Company has
borrowed other amounts from Value Partners from time to time (some of which
have been in technical default for


                                       32
<PAGE>

which forbearance or waivers have been granted) and may seek to borrow
additional funds or obtain equity investments from Value Partners in the
future. At December 31, 1999, Value Partners owned 59% of the Company's
long-term debt and owned warrants to acquire 61.2% of the Company's issued and
outstanding shares of Common Stock.

ITEM 13.    EXHIBITS AND REPORTS ON FORM 8-K.

        (a)      EXHIBITS

        Reference is made to the Exhibit Index hereinafter contained.

        A copy of any exhibits listed or referred to herein will be furnished
        at a reasonable cost to any person who was a shareholder of the Company
        as of May 10, 2000, upon written request from any such person. Requests
        should be sent to: Rami S. Ramadan, Chief Executive Officer, Trans
        World Gaming Corp., 545 Fifth Avenue, Suite 940, New York, New York
        10017.

        (b)      REPORTS ON FORM 8-K

        During the last quarter of the year ended December 31, 1999, the
        Company filed a Periodic Report on Form 8-K with the SEC on October 28,
        1999. This Periodic Report related to the $3.0 million financing in the
        October 1999 Private Placement.








                                       33

<PAGE>



                            TRANS WORLD GAMING CORP.
                 EXHIBIT INDEX TO ANNUAL REPORT ON FORM 10-KSB/A
                      FOR THE YEAR ENDED DECEMBER 31, 1999


<TABLE>
<CAPTION>

                   -----------------------------------------------    --------------------------------
Item No              Item                                               Method of Filing
<S>                <C>                                                <C>
2                    Deed of Sale of Shares Authenticated Mr. Jose      Incorporated by reference to Exhibit 2 contained in
                     Maria Badia Gasco, Notary of Zaragoza, dated       the Form 8-K/A file don July 2, 1998 (File No.
                     April 17, 1998                                     0-25244)



3.1                  Articles of Incorporation                          Incorporated by reference to Exhibit 3.1 contained in
                                                                        the registration statement on Form SB-2 (File No.
                                                                        33-85446-A)



3.2                  Bylaws                                             Incorporated by reference to Exhibit 3.2 contained in
                                                                        the registration statement on Form SB-2 (File No.
                                                                        33-85446-A).



4.1                  Specimen Common Stock Certificate                  Incorporated by reference to Exhibit 4.1 contained in
                                                                        the registration statement on Form SB-2 (File No.
                                                                        33-85446-A).



4.2                  Specimen Redeemable Common Stock                   Incorporated by reference to Exhibit 4.2 contained in
                     Purchase Warrant                                   the registration statement on Form SB-2 (File No.
                                                                        33-85446-A).



4.3                  Form of Warrant Agreement                          Incorporated by reference to Exhibit 4.3 contained in
                                                                        the registration statement on Form SB-2 (File No.
                                                                        33-85446-A).



4.4                  Confidential Private Placement Memorandum          Incorporated by reference to Exhibit 4.4 contained in
                     dated June 17, 1996                                Form 10-KSB for the fiscal year ended December 31,
                                                                        1996. (File No. 0-25244)



4.5                  Supplement No. 1 dated January 14, 1997 to         Incorporated by reference to Exhibit 4.5 contained in
                     Confidential Private Placement Memorandum          Form 10-KSB for the fiscal year ended December 31,
                     dated June 17, 1996                                1996. (File No. 0-25244)



4.6                  Indenture dated as of November 1, 1996             Incorporated by reference to Exhibit 4.6 contained in
                     between the Company and Trans World                Form 10-KSB for the fiscal year ended December 31,
                     Gaming of Louisiana, Inc., as Issuer, and          1996. (File No. 0-25244)
                     U.S. Trust Company of Texas, N.A., as Trustee



4.7                  Form of 12% Secured Convertible Senior             Incorporated by reference to Exhibit 4.7 contained in
                     Bond due June 30, 1999                             Form 10-KSB for the fiscal year ended December 31,
                                                                        1996. (File No. 0-25244)



                                     34
<PAGE>

4.8                 Form of Warrant to Purchase Common Stock            Incorporated by reference to Exhibit 4.8 contained in
                    dated July 1, 1996                                  Form 10-KSB for the fiscal year ended December 31,
                                                                        1996. (File No. 0-25244)



4.9                 Form of Warrant for Purchase of Shares of           Incorporated by reference to Exhibit 4.9 contained in
                    Common Stock dated January 1, 1997                  Form 10-KSB for the fiscal year ended December 31,
                                                                        1996. (File No. 0-25244)



4.10                Form of Non-Negotiable Promissory Note              Incorporated by reference to Exhibit 4.10 contained
                    dated January 1, 1997                               in Form 10-KSB for the fiscal year ended December 31,
                                                                        1996. (File No. 0-25244)



4.11                First Amended Senior Secured Promissory             Incorporated by reference to Exhibit 4.11 contained
                    Note dated December 19, 1997                        in Form 10-KSB for the fiscal year ended December 31,
                                                                        1997 filed on March 30, 1998. (File No. 0-25244)



4.12                Form of Warrant for Purchase of Shares of           Incorporated by reference to Exhibit 4.12 contained
                    Common Stock dated January 15, 1998                 in Form 10-KSB for the fiscal year ended December 31,
                                                                        1997 filed on March 30, 1998. (File No. 0-25244)



4.13                Lenders Waiver and Option Agreement dated           Incorporated by reference to Exhibit 4.13 contained
                    March 9, 1998                                       in Form 10-KSB for the fiscal year ended December 31,
                                                                        1997 filed on March 30, 1998. (File No. 0-25244)



4.14                Indenture dated March 31, 1998 among the            Incorporated by reference to Exhibit 4(I) contained
                    Company, TWG International U.S.                     in the Form 8-K filed on April 14, 1998 (File No.
                    Corporation, TWG Finance Corp. and U.S.             0-25244)
                    Trust Company of Texas, N.A.



4.15                Series C Warrant to Purchase Common Stock           Incorporated by reference to Exhibit 4(II) contained
                    dated March 31, 1998                                in the Form 8-K filed on April 14, 1998 (File  No.
                                                                        0-25244)



4.16                Indenture dated March 31, 1998 between TWG          Incorporated by reference to Exhibit 4(III) contained
                    International U.S. Corporation and U.S. Trust       in the Form 8-K filed on April 14, 1998 (File No.
                    Company of Texas, N.A.                              0-25244)



4.17                Consent to Amend Indenture, Bonds and               Incorporated by reference to Exhibit 4(IV) contained
                    Warrants dated March 25, 1998 by and                in the Form 8-K filed on April 14, 1998 (File No.
                    between the Company, Trans World Gaming of          0-25244)
                    Louisiana, Inc., U.S. Trust Company of Texas,
                    N.A., and certain individuals



                                     35
<PAGE>

4.18                First Amended Indenture dated March 31, 1998        Incorporated by reference to Exhibit 4(V) contained
                    among the Company, TWGLa and U.S. Trust             in the Form 8-K filed on April 14, 1998 (File No.
                    Company of Texas, N.A.                              0-25244)



4.19                First Amended Indenture dated March 31,1998         Incorporated by reference to Exhibit 4(V) contained
                    among the Company, TWGLa and U.S. Trust             in the Form 8-K filed on April 14, 1998 (File No.
                    Company of Texas, N.A.                              0-25244)



4.20                Series A Warrant to Purchase Common Stock           Incorporated by reference to Exhibit 4(VI) contained
                    dated March 31, 1998                                in the Form 8-K filed on April 14, 1998 (File  No.
                                                                        0-25244)



4.21                Series B Warrant to Purchase Common Stock           Incorporated by reference to Exhibit 4(VII) contained
                    dated March 31, 1998                                in the Form 8-K filed on April 14, 1998 (File  No.
                                                                        0-25244)



4.22                Agreement to Amend Warrants dated March             Incorporated by reference to Exhibit 4(VIII) contained
                    31, 1998 among the Company and the named            in the Form 8-K filed on April 14, 1998 (File No.
                    Holders                                             0-25244)



10.1                Agreement for Exchange of Shares dated July         Incorporated by reference to Exhibit 10.1 contained
                    12, 1994, between the Company and the               in the registration statement on Form SB-2 (File No.
                    shareholders of Lee Young Enterprises, Inc.         33-85446-A).



10.2                Asset Purchase Agreement dated as of                Incorporated by reference to Exhibit 10.2 contained
                    September 21, 1994, between the Company and         in the registration statement on Form SB-2 (File No.
                    Prime Properties, Inc.                              33-85446-A).



10.3                Agreement of Sale dated as of September 21,         Incorporated by reference to Exhibit 10.3 contained
                    1994, between the Company and Prime                 in the registration statement on Form SB-2 (File No.
                    Properties, Inc.                                    33-85446-A).



10.4                Form of Lease between Prime Properties, Inc.        Incorporated by reference to Exhibit 10.4 contained
                    and the Company.                                    in the registration statement on Form SB-2 (File No.
                                                                        33-85446-A).



10.5                Agreement dated September 21, 1994, among           Incorporated by reference to Exhibit 10.5 contained
                    Chrysolith, LLC, Prime Properties, Inc.,            in the registration statement on Form SB-2 (File No.
                    Monarch Casinos, Inc. of Louisiana, and the         33-85446-A).
                    Company.



10.6                Asset Purchase  Agreement  dated  September         Incorporated by reference to Exhibit 10.6 contained
                    21, 1994, between Chrysolith L.L.C. and             in the registration statement on Form SB-2 (File No.
                    Monarch                                             33-85446-A).



                                     36
<PAGE>

10.7                Lease (with option) dated May 10, 1994 among        Incorporated by reference to Exhibit 10.7 contained
                    Lula Miller, Inc., Charles A. Jones III and         in the registration statement on Form SB-2 (File No.
                    Kelly McCoy Jones, as Lessor, and Monarch,          33-85446-A).
                    as Lessee.



10.8                Offer to Purchase dated October 4, 1994,            Incorporated by reference to Exhibit 10.8 contained
                    among Trans World Gaming of Louisiana, Inc.,        in the registration statement on Form SB-2 (File No.
                    Monarch, Lula Miller, Inc., Charles A. Jones        33-85446-A).
                    III and Kelly McCoy Jones.



10.9                Memorandum of Agreement dated March 18,             Incorporated by reference to Exhibit 10.9 contained
                    1994, between the Company and Yves Gouhier          in the registration statement on Form SB-2 (File No.
                    and Camille Costard to acquire shares of            33-85446-A).
                    Casino Cherbourg S.A., as amended (English
                    translation, except amendment is in French.)



10.10               Shareholder Agreement dated April 7, 1994,          Incorporated by reference to Exhibit 10.10 contained
                    between the Company and Michael A.                  in the registration statement on Form SB-2 (File No.
                    Edwards, as the shareholders of Monarch             33-85446-A).



10.11               Employment Agreement dated March 6, 1996            Incorporated by reference to Exhibit 10.11 contained
                    between the Company and Stanley Kohlenberg          in the Form 10-KSB for the fiscal year ended
                                                                        December 31, 1995 (File No. 0-25244).



10.12               Employment Agreement between the Company            Incorporated by reference to Exhibit 10.12 contained
                    and Dominick J. Valenzano                           in the registration statement on Form SB-2 (File No.
                                                                        33-85446-A).



10.13               1993 Incentive Stock Option Plan                    Incorporated by reference to Exhibit 10.13 contained
                                                                        in the registration statement on Form SB-2 (File No.
                                                                        33-85446-A).



10.14               Form of 4 1/2% Bridge Note                          Incorporated by reference to Exhibit 10.14 contained
                                                                        in the registration statement on Form SB-2 (File No.
                                                                        33-85446-A).



10.15               Form of 10% Secured Bridge                          Incorporated by reference to Exhibit 10.15 contained
                                                                        in the registration statement on Form SB-2 (File No.
                                                                        33-85446-A).



                                     37
<PAGE>

10.16               Collateral Mortgage relating to the Woodlands       Incorporated by reference to Exhibit 10.16 contained
                    Travel Plaza.                                       in the registration statement on Form SB-2 (File No.
                                                                        33-85446-A).



10.17               Operating Agreement dated as of December            Incorporated by reference to Exhibit 10.17 contained
                    22, 1994 between the Company and                    in the Form 10-KSB for the fiscal year ended
                    Chrysolith relating to the Gold Coin.               December 31, 1994 (File No. 0-25244).



10.18               Note in principal amount $75,000 payable by         Incorporated by reference to Exhibit 10.18 contained
                    Monarch (and assumed by the Company).               in the Form 10-KSB for the fiscal year ended
                                                                        December 31, 1994 (File No. 0-25244).



10.19               Lease Agreement dated May 1, 1993 between           Incorporated by reference to Exhibit 10.19 contained
                    National Auto/Truck Stops, Inc. and Prime           in the Form 10-KSB for the fiscal year ended
                    Properties with respect to the 76 Plaza             December 31, 1995 (File No. 0-25244).



10.20               Agreement and General Release dated as of           Incorporated by reference to Exhibit 10.20 contained
                    March 6, 1996 between the Company and R.            in the Form 10-KSB for the fiscal year ended
                    K. Merkey.                                          December 31, 1995 (File No. 0-25244).



10.21               Forbearance Agreement dated January 19,             Incorporated by reference to Exhibit 10.21 contained
                    1996 between the Company and Chrysolith             in the Form 10-KSB for the fiscal year ended
                                                                        December 31, 1995 (File No. 0-25244).



10.22               Letter Agreement dated January 30, 1996             Incorporated by reference to Exhibit 10.22 contained
                    between the Company and Chrysolith                  in the Form 10-KSB for the fiscal year ended
                    regarding forbearance payments                      December 31, 1995 (File No. 0-25244).



10.23               Consulting Agreement dated January 1, 1997          Incorporated by reference to Exhibit 10.23 contained
                    between the Company and Stanley                     in the Form 10-KSB for the fiscal year ended
                    Kohlenberg                                          December 31, 1996 (File No. 0-25244).



10.24               Employment Agreement dated December 26,             Incorporated by reference to Exhibit 10.24 contains
                    1996 between the Company and Andrew                 in Form 10-KSB for the fiscal year ended December 31,
                    Tottenham                                           1996 (File No. 0-25244).



10.25               Employment Agreement date February 1,               Incorporated by reference to Exhibit 10.25 contained
                    1997 between the Company and Christopher            in Form 10-KSB for the fiscal year ended December
                    Moore                                               31, 1996 (File No. 0-25244).



                                     38
<PAGE>

10.26               Cancellation Agreement dated as of October 3,       Incorporated by reference to Exhibit 10.26 contained
                    1996 between the Company and Mid-City               in the Form 10-KSB for the fiscal year ended
                    Associates                                          December 31, 1996 (File No. 0-25244).



10.27               Agreement of Lease dated as of October 2,           Incorporated by reference to Exhibit 10.27 contained
                    1996 between the Company and Mid-City               in the Form 10-KSB for the fiscal year ended
                    Associates                                          December 31, 1996 (File No. 0-25244).



10.28               Stock Purchase Agreement dated as of January        Incorporated by reference to Exhibit 10.28 contained
                    1, 1997 among the Company, Andrew                   in the Form 10-KSB for the fiscal year ended
                    Tottenham and Robin Tottenham                       December 31, 1996 (File No. 0-25244).



10.29               Employment Agreement dated April 15, 1997           Incorporated by reference to Exhibit 10.29 contained
                    between the Company and James Hardman               in Form 10-KSB for the fiscal year ended December
                                                                        31, 1997 filed on March 30, 1998. (File No. 0-25244)



10.30               Stock Purchase Agreement dated as of January        Incorporated by reference to Exhibit 10.30 contained
                    20, 1998 between the Company and 21st               in Form 10-KSB for the fiscal year ended December
                    Century Resorts                                     31, 1997 filed on March 31, 1998. (File No. 0-25244)



10.31               Form of the Subscription Agreement for the          Incorporated by reference to Exhibit 10.31 contained
                    Private Placement                                   in Form 10-KSB for the fiscal year ended December
                                                                        31, 1997 filed on March 31, 1998. (File No. 0-5244)



10.32               Escrow Agreement dated March 17, 1998               Incorporated by reference to Exhibit 10.32 contained
                    among the Company, TWG Finance Corp.,               in Form 10-KSB for the fiscal year ended December
                    TWG International U.S. Corporation as Issuer        31, 1997 filed on March 30, 1998. (File No. 0-25244)
                    and U.S. Trust Company of Texas, N.A., as
                    Trustee



10.33               Consulting Agreement between Chrysolith,            Incorporated by reference to Exhibit 10 contained in
                    L.L.C. and Lee Young dated January 1, 1997          the Form 10-QSB for the quarter ended June 30, 1996
                                                                        filed on August 14, 1996 (File No. 0-25244)



10.34               Purchase Agreement dated as of April 15,            Incorporated by reference to Exhibit 10.34 contained
                    1997 among the Company, James R.                    in the Form 10-Q for the quarter ended March 31,
                    Hardman, Jr. and Multiple Application               1997, filed on May 9, 1997 (File No. 0-25244)
                    Tracking System



                                     39
<PAGE>

10.35               License Agreement dated as of April 15, 1997        Incorporated by reference to Exhibit 10.35 contained
                    between the Company and James R. Hardman,           in the Form 10-Q for the quarter ended March 31,
                    Jr.                                                 1997, filed on May 9, 1997 (File No. 0-25244)



10.36               Loan Agreement dated June 11, 1997 between          Incorporated by reference to Exhibit 10.36 contained
                    the Company and Value Partners                      in the Form 8-K filed on June 17, 1997 (File No.
                                                                        0-25244)



10.37               $350,000 Senior Promissory Note dated June          Incorporated by reference to Exhibit 10.37 contained
                    11, 1997                                            in the Form 8-K filed on June 17, 1997 (File No.
                                                                        0-25244)



10.38               Joint Activity Agreement dated March 31,            Incorporated by reference to Exhibit 10.38 contained
                    1997 between Mr. Mahmud Avdiyev and                 in the Form 8-K filed on June 17, 1997 (File No.
                    Tottenham & Co., d/b/a Art Marketing Ltd.           0-25244)



10.39               Loan Agreement dated October 27, 1997,              Incorporated by reference to Exhibit 10.39 contained
                    between Value Partners, and the Company             in the Form 10-QSB for the quarter ended September
                                                                        30, 1997, filed on November 12, 1997 (File No.
                                                                        0-25244)



10.40               $262,500 Senior Promissory Note dated               Incorporated by reference to Exhibit 10.40 contained
                    October 27, 1997                                    in the Form 10-QSB for the quarter ended September
                                                                        30, 1997, filed on November 12, 1997 (File No.
                                                                        0-25244)



10.41               Warrant to Purchase Common Stock dated              Incorporated by reference to Exhibit 10.41 contained
                    November 27, 1997                                   in the Form 10-QSB for the quarter ended September
                                                                        30, 1997, filed on November 12, 1997 (File No.
                                                                        0-25244)



10.42               Employment Agreement between the                    Incorporated by reference to Exhibit 10.42 contained
                    Company and Rami S. Ramadan dated July              in the Form 8-K filed on July 13, 1999 (File No.
                    12, 1999                                            0-25244)



10.43               Severance Agreement between the Company             Incorporated by reference to Exhibit 10.43 contained
                    and Stanley Kohlenberg dated May 23, 1999           in the Form 8-K filed on July 13, 1999 (File No.
                                                                        0-25244)



                                     40
<PAGE>

10.44               Severance Agreement among the Company,              Incorporated by reference to Exhibit 10.44
                    Trans World Gaming of Louisiana, TWG                contained in the Form 8-K filed on July 13, 1999
                    International U.S. Corporation and TWG              (File No. 0-25244)
                    Finance Corp. and Dominick J. Valenzano
                    dated July 12, 1999



10.45               Form of Lease Agreement between London              Incorporated by reference to Exhibit 10.45
                    Investments s.r.o. and the Company                  contained in the Form 8-K filed on July 13, 1999
                                                                        (File No. 0-25244)



10.46               1998 Incentive Stock Option Plan                    Filed herewith. (File No. 0-25244)

10.47               1999 Non-Employee Director Stock Option             Filed herewith. (File No. 0-25244)
                    Plan



10.48               Form 12% Secured Senior Note due March              Filed herewith. (File No. 0-25244)
                    2005



10.49               Form of Warrant to Purchase Common Stock            Filed herewith. (File No. 0-25244)
                    dated October 15, 1999



16.1                Letter from Bederson & Co. (the Company's           Incorporated by reference to Exhibit 16.1
                    former independent public accountants)              contained in the Form 10-QSB for the fiscal year
                    relating to a change of accountants                 ended December 31, 1995, filed on November 12,
                                                                        1997 (File No. 0-25244)



16.2                Letter from Pannell, Kerr, Forster PC (the          Incorporated by reference to Exhibit 16.2
                    Company's former independent public                 contained in the Form 8-K filed on February 25,
                    accountants) relating to a change of                1999 (File No. 0-25244)
                    accountants



21.0                Subsidiaries                                        Filed herewith (File No. 0-25244)



27.1                Financial Data Schedule                             Filed herewith


</TABLE>


                                     41
<PAGE>




                                   SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the Issuer has duly caused this Amended Report to be signed on its
behalf by the undersigned, thereunto duly authorized.

                                                TRANS WORLD GAMING CORP.
                                                    (registrant)



Dated:   May 26, 2000                      By:    /s/ Rami S. Ramadan
                                                  -----------------------------
                                                  Rami S. Ramadan
                                                  Chief Executive Officer/
                                                  Chief Financial Officer
                                                  (Principal Executive and
                                                  Financial Officer)


         Pursuant to the requirements of the Securities Exchange Act of 1934,
this Amended Report has been signed below by the following persons on behalf of
the Issuer on May 26, 2000 in the capacities indicated.

                                                  SIGNATURE AND TITLE



                                                  /s/ Andrew Tottenham
                                                  -----------------------------
                                                  Andrew Tottenham
                                                  President and Director


                                                  /s/ Geoffrey B. Baker
                                                  -----------------------------
                                                  Director


                                                  /s/ Malcolm M.B. Sterrett
                                                  -----------------------------
                                                  Director


                                                  /s/ Julio E. Heurtematte, Jr.
                                                  -----------------------------
                                                  Director


                                     42
<PAGE>


                    TRANS WORLD GAMING CORP. AND SUBSIDIARIES





                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS



<TABLE>
<CAPTION>

                                                                      Page
                                                                      ----
<S>                                                                  <C>
Independent Auditors' Report                                          F-1

Consolidated Balance Sheet                                            F-2

Consolidated Statements of Operations and Comprehensive Loss          F-3

Consolidated Statements of Stockholders' Deficit                      F-4

Consolidated Statements of Cash Flows                                F5-6

Notes to Consolidated Financial Statements                          F7-23



</TABLE>









                                     43


<PAGE>


                   TRANS WORLD GAMING CORP. AND SUBSIDIARIES

                       CONSOLIDATED FINANCIAL STATEMENTS
                                      AND
                          INDEPENDENT AUDITORS' REPORT

                           DECEMBER 31, 1999 AND 1998

















<PAGE>

                          INDEPENDENT AUDITORS' REPORT


Board of Directors
Trans World Gaming Corp.

We have audited the accompanying consolidated balance sheet of Trans World
Gaming Corp. and Subsidiaries as of December 31, 1999, and the related
consolidated statements of operations and comprehensive loss, stockholders'
deficit and cash flows for the years ended December 31, 1999 and 1998. These
consolidated financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these consolidated
financial statements based on our audits. We did not audit the financial
statements of a wholly-owned subsidiary, which statements reflect total assets
of approximately $1,636,000 as of December 31, 1999, and total revenues of
approximately $3,877,000 and $3,481,000 for the years ended December 31, 1999
and 1998, respectively. Those financial statements were audited by other
auditors whose report has been furnished to us, and our opinion, insofar as it
relates to the amounts included for the wholly-owned subsidiary, is based
solely on the report of the other auditors.

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

In our opinion, based on our report and the report of other auditors, the
consolidated financial statements referred to above present fairly, in all
material respects, the consolidated financial position of Trans World Gaming
Corp. and Subsidiaries as of December 31, 1999, and the consolidated results
of their operations and their cash flows for the years ended December 31, 1999
and 1998, in conformity with generally accepted accounting principles.

The accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in Note 1 to
the consolidated financial statements, the Company has suffered significant
losses from operations and has a working capital deficit and a stockholders'
deficit at December 31, 1999. These conditions raise substantial doubt about
the Company's ability to continue as a going concern. Management's plans
regarding those matters are also described in Note 1. The consolidated
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.







Roseland, New Jersey
February 17, 2000, except for Note
15, for which the date is March 28, 2000

                                     F-1

<PAGE>

                    TRANS WORLD GAMING CORP. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEET
                                December 31, 1999
                    (in thousands, except for per share data)


<TABLE>


<S>                                                                   <C>
ASSETS
CURRENT ASSETS
  Cash                                                                $      934
  Accounts receivable                                                         38
  Prepaid expenses and other current assets                                  770
                                                                      ----------
          TOTAL CURRENT ASSETS                                             1,742
                                                                      ----------
PROPERTY AND EQUIPMENT, net                                                5,112
                                                                      ----------
OTHER ASSETS

  Goodwill and other intangible assets, less accumulated
  amortization of $3,999                                                  10,429
  Deposits and other assets                                                  710
                                                                      ----------
                                                                          11,139
                                                                      ----------
                                                                      $   17,993
                                                                      ==========
LIABILITIES AND STOCKHOLDERS' DEFICIT

CURRENT LIABILITIES

  Short-term debt                                                     $      146
  Accounts payable                                                         1,804
  Accrued expenses and other current liabilities                           3,768
                                                                      ----------
          TOTAL CURRENT LIABILITIES                                        5,718
                                                                      ----------
LONG-TERM LIABILITIES

  Long-term debt                                                          20,549
  Other long-term liabilities                                              5,970
                                                                      ----------
                                                                          26,519
                                                                      ----------
COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' DEFICIT
  Preferred stock, $.001 par value, 2,000 shares authorized,
   none issued
  Common stock $.001 par value, 50,000 shares authorized,
   5,365 shares issued and outstanding                                         5
  Additional paid-in capital                                              10,104
  Stock warrants outstanding                                               4,912
  Accumulated other comprehensive income                                   1,035
  Accumulated deficit                                                    (30,300)
                                                                      ----------
     TOTAL STOCKHOLDERS' DEFICIT                                         (14,244)
                                                                      ----------
                                                                      $   17,993
                                                                      ==========

</TABLE>

           SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


                                     F-2

<PAGE>

                    TRANS WORLD GAMING CORP. AND SUBSIDIARIES

          CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
                                December 31, 1999
                    (in thousands, except for per share data)


<TABLE>
<CAPTION>

                                                                     1999            1998
                                                                 -----------     -----------
<S>                                                              <C>             <C>
REVENUES                                                         $    12,294     $     9,016
                                                                 -----------     -----------
COSTS AND EXPENSES
  Cost of revenues                                                     8,149           7,458
  Depreciation and amortization                                        2,839           2,485
  Selling, general and administrative                                  4,349           2,486
  Provision for impairment                                                             4,000
  Write-offs                                                                             559
                                                                 -----------     -----------
                                                                      15,337          16,988
                                                                 -----------     -----------
LOSS FROM OPERATIONS                                                  (3,043)         (7,972)
                                                                 -----------     -----------
OTHER INCOME (EXPENSE)
  Interest income                                                         40              85
  Interest expense                                                    (3,025)         (2,465)
  Foreign exchange gain (loss)                                          (217)            148
  Other                                                                   58            (296)
                                                                 -----------     -----------
                                                                      (3,144)         (2,528)
                                                                 -----------     -----------
LOSS BEFORE INCOME TAXES                                              (6,187)        (10,500)
INCOME TAXES, foreign                                                                   (191)
                                                                 -----------     -----------
LOSS FROM CONTINUING OPERATIONS                                       (6,187)        (10,691)
DISCONTINUED OPERATIONS, loss from operations of discontinued
  truckstop segment                                                     (222)            (38)
                                                                 -----------     -----------
NET LOSS                                                         $    (6,409)    $   (10,729)
                                                                 ===========     ===========
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING, basic and diluted          3,598           3,044
                                                                 ===========     ===========
LOSS PER COMMON SHARE, basic and diluted
  From continuing operations                                     $     (1.72)    $     (3.51)
  From discontinued operations                                         (0.06)          (0.01)
                                                                 -----------     -----------
  Net loss                                                       $     (1.78)    $     (3.52)
                                                                 ===========     ===========
COMPREHENSIVE LOSS
NET LOSS                                                         $    (6,409)    $   (10,729)
OTHER COMPREHENSIVE INCOME, foreign currency
 translation adjustment                                                  923             112
                                                                 -----------     -----------
COMPREHENSIVE LOSS                                               $    (5,486)    $   (10,617)
                                                                 ===========     ===========

</TABLE>

           SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


                                     F-3

<PAGE>


                   TRANS WORLD GAMING CORP. AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF SHAREHOLDERS' DEFICIT
                     YEARS ENDED DECEMBER 31, 1999 AND 1998
                    (IN THOUSANDS, EXCEPT FOR PER SHARE DATA)

<TABLE>
<CAPTION>
                                            Common
                                             Stock        Additional        Stock          Other
                                        ---------------     Paid-in        Warrants     Comprehensive  Stockholders'
                                        Shares   Amount     Capital       Outstanding      Income        Deficit       Deficit
                                        ------   ------     -------       -----------      ------        -------       -------
<S>                                     <C>         <C>     <C>             <C>           <C>            <C>         <C>

BALANCES, January 1, 1998               3,044       $3      $ 8,896          $  537        $       -     $(13,162)     $(3,726)

ISSUANCE OF STOCK WARRANTS                                                    4,700                                      4,700

ISSUANCE OF COMMON STOCK
  IN SETTLEMENT OF NOTES PAYABLE
  AND ACCRUED INTEREST                    320                   240                                                        240

FOREIGN CURRENCY TRANSLATION                                                                     112                       112
ADJUSTMENT

NET LOSS                                                                                                  (10,729)     (10,729)
                                        -----       --      -------         -------       ----------     --------    ---------

BALANCES, December 31, 1998             3,364        3        9,136           5,237              112      (23,891)      (9,403)

ISSUANCE OF WARRANTS                                                            625                                        625


EXERCISE OF WARRANTS                    2,001        2          968            (950)                                        20

FOREIGN CURRENCY TRANSLATION
ADJUSTMENT                                                                                       923                       923

NET LOSS                                                                                                   (6,409)      (6,409)
                                        -----       --      -------         -------       ----------     --------    ---------
BALANCES, December 31, 1999             5,365       $5      $10,104         $ 4,912       $    1,035     $(30,300)   $ (14,244)
                                        =====       ==      =======         =======       ==========     ========    =========

</TABLE>


           SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


                                       F-4

<PAGE>


                    TRANS WORLD GAMING CORP. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                     YEARS ENDED DECEMBER 31, 1999 and 1998
                    (IN THOUSANDS, EXCEPT FOR PER SHARE DATA)

<TABLE>
<CAPTION>

                                                                                     1999          1998
                                                                                   --------     --------
<S>                                                                                <C>          <C>

CASH FLOWS FROM OPERATING ACTIVITIES
  Net loss                                                                         $ (6,409)    $(10,729)
  Add: loss from discontinued operations                                               (222)         (38)
                                                                                   --------     --------
  Loss from continuing operations                                                    (6,187)     (10,691)
  Adjustments to reconcile net loss from continuing
operations to net cash used in continuing operations:
    Provision for allowance for doubtful accounts                                                    252
    Depreciation and amortization                                                     2,839        2,485
    Noncash interest                                                                    542          610
    Provision for impairment                                                                       4,000
    Write-offs                                                                                       559
    Other                                                                                              8
    Increase (decrease) in cash attributable to changes in
  operating assets and liabilities:
     Accounts and other receivables                                                     186          (25)
     Prepaid expenses and other current assets                                         (331)        (540)
     Other assets                                                                       (85)        (612)
     Accounts payable, accrued expenses and other liabilities                         2,369        2,590
                                                                                   --------     --------
  Net cash used in continuing operations                                               (667)      (1,364)
  Net cash provided by (used in) discontinued operations                               (197)          28
                                                                                   --------     --------
NET CASH USED IN OPERATING ACTIVITIES                                                  (864)      (1,336)
                                                                                   --------     --------
CASH FLOWS FROM INVESTING ACTIVITIES
  Acquisitions of Resorts and CDZ, net of cash acquired                                          (12,754)
  Purchases of property and equipment                                                (2,422)      (1,476)
  Payment for deposit                                                                   (34)
  Proceeds from the sale of property of discontinued
operations                                                                              379
                                                                                   --------     --------
NET CASH USED IN INVESTING ACTIVITIES                                                (2,077)     (14,230)
                                                                                   --------     --------
CASH FLOWS FROM FINANCING ACTIVITIES
  Proceeds from short-term debt                                                         450        1,250
  Payments of short-term debt                                                        (1,360)        (194)
  Proceeds from long-term debt                                                        3,000       17,525
  Payments of long-term debt                                                                      (1,312)
  Proceeds from exercise of warrants                                                     20
                                                                                   --------     --------
NET CASH PROVIDED BY FINANCING ACTIVITIES                                             2,110       17,269
                                                                                   --------     --------
EFFECT OF EXCHANGE RATE CHANGES ON CASH                                                (190)          54
                                                                                   --------     --------
NET INCREASE (DECREASE) IN CASH                                                      (1,021)       1,757
CASH

  Beginning of year                                                                   1,955          198
                                                                                   --------     --------
  End of year                                                                      $    934     $  1,955
                                                                                   ========     ========

</TABLE>


           SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


                                       F-5
<PAGE>


                    TRANS WORLD GAMING CORP. AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
                     YEARS ENDED DECEMBER 31, 1999 AND 1998
                    (IN THOUSANDS, EXCEPT FOR PER SHARE DATA)

<TABLE>
<CAPTION>

                                                                                  1999          1998
                                                                                 ------        ------
<S>                                                                              <C>           <C>

SUPPLEMENTAL DISCLOSURES OF CASH FLOW
INFORMATION,
cash paid during the year for:
  Interest                                                                       $2,515        $1,706
                                                                                 ======        ======
  Income taxes, foreign                                                          $  162        $  346
                                                                                 ======        ======

SUPPLEMENTAL DISCLOSURES OF NONCASH INVESTING AND FINANCING ACTIVITIES
  Common stock issued in settlement of notes payable
   and accrued interest                                                          $   --        $  240
                                                                                 ======        ======
  Issuance of stock warrants with debt                                           $  625        $4,700
                                                                                 ======        ======
  Note payable forgiven in connection with sale of subsidiary                    $  206        $   --
                                                                                 ======        ======

</TABLE>

           SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS











                                       F-6
<PAGE>

                    TRANS WORLD GAMING CORP. AND SUBSIDIARIES
                        NOTES TO CONSOLIDATED STATEMENTS
                    (IN THOUSANDS, EXCEPT FOR PER SHARE DATA)


NOTE 1 -      NATURE OF BUSINESS AND GOING CONCERN CONSIDERATION

              OVERVIEW

              Trans World Gaming Corp. and Subsidiaries (the "Company"), a
              Nevada corporation, is primarily engaged in the gaming business
              in the United States, the Czech Republic and Spain. Its United
              States gaming operations ceased as of June 30, 1999 (SEE NOTE
              14).

              GAMING OPERATIONS - UNITED STATES

              Until March 1998, the Company's only gaming operations were two
              video poker parlors ("Gold Coin" and "Toledo Palace") situated at
              truck stops in Louisiana. The Company's video poker operations in
              Louisiana were managed by Chrysolith, LLC ("Chrysolith"), a
              Louisiana-licensed video gaming operator in which the Company
              owns 49% of its Class B membership units.

              As a result of parish (county) votes to eliminate video poker in
              the parishes in Louisiana where the Company's video poker
              operations are located, the Company ceased its video poker
              operations on June 30, 1999. The Company, together with other
              companies operating video poker parlors in the affected parishes,
              continue to challenge the votes through the courts. The viability
              of such challenge is uncertain.

              GAMING OPERATIONS - CZECH REPUBLIC

              In March 1998, the Company acquired a company operating two
              casinos in the western Czech Republic, close to the border of the
              German State of Bavaria (SEE NOTE 3). The larger casino, located
              in Ceska Kubice, currently has fifteen table games and seventy
              slot machines. The smaller casino, located in Rozvadov, currently
              has seven table games and thirty-eight slot machines.

              As part of the March 1998 transaction, the Company also acquired
              land in the southern Czech Republic, close to the border of
              Austria. In December 1999, construction of the Company's third
              Czech casino was completed on the land and operations commenced.
              The newly-opened casino, located in Hate (near Snojmo), currently
              has eleven table games and forty-two slot machines.

              GAMING OPERATIONS - SPAIN

              In April 1998, the Company acquired a company that owns the
              license to operate the only casino in the Spanish province of
              Aragon (SEE NOTE 3). The casino, with nine table games and
              twenty-four slot machines, is currently situated fifteen miles
              outside of Zaragoza. The Company had reached an understanding
              with an agency of the provincial government, the Diputacion
              General de Aragon ("DGA"), to allow the casino to move to the
              center of Zaragoza, subject to the issuance of a decree.
              However, instead of a decree, in February 2000, the DGA
              introduced a law that would allow the casino to relocate. The
              law is expected to be presented to local Spanish parliament in
              June 2000. Management has indicated that, based on its
              discussions with Spanish authorities, the law has little
              opposition and is expected to pass.

                                     F-7
<PAGE>

                    TRANS WORLD GAMING CORP. AND SUBSIDIARIES


NOTE 1 -      NATURE OF BUSINESS AND GOING CONCERN CONSIDERATION (CONTINUED)

              OTHER -

              In March 1997, the Company, through a wholly-owned subsidiary,
              signed a twenty-year consulting agreement with the owner and
              operator of Boxer Casino located in Gyandja, Azerbaijan Republic
              (a former member of the Soviet Union). In January 1998, the
              Company, through a wholly-owned subsidiary, entered into a
              twenty-year management agreement with Jockey Club Casinos LLC for
              the management and operation of a casino in Bishkek, Kyrgyz
              Republic (a former member of the Soviet Union). Both of these
              arrangements were abruptly halted by local governments' decisions
              to cease casino operations and written off by the Company during
              the year ended December 31, 1998 (SEE NOTE 9).

              GOING CONCERN CONSIDERATION

              The accompanying consolidated financial statements have been
              prepared assuming the Company will continue as a going concern.
              The Company has suffered significant losses from operations and
              has a working capital deficit of $3,976 and a stockholders'
              deficit of $14,244 as of December 31, 1999. Furthermore, the
              Company is highly leveraged with debt (SEE NOTE 5). These
              conditions raise substantial doubt about the Company's ability to
              continue as a going concern. The consolidated financial
              statements do not include any adjustments that might result from
              the outcome of this uncertainty. The Company has taken steps to
              improve its situation including the December 1999 opening of its
              third Czech casino and certain cost cutting measures. Further,
              management's plans include an expansion strategy to counter the
              affects of seasonality on the Company's cash flows. The goals of
              the expansion strategy are to diversify the Company's portfolio
              of operations in terms of geographical location and to add
              hotels to the mix of operations. In implementing its expansion
              strategy, the Company is seeking management or joint venture
              agreements and leased space arrangements that will avoid further
              indebtedness.


NOTE 2 -      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

              PRINCIPLES OF CONSOLIDATION - The consolidated financial
              statements include the accounts of the Company and its
              wholly-owned and majority-owned subsidiaries. All significant
              intercompany balances and transactions have been eliminated in
              consolidation.

              CASH - Cash consists of cash in banks and on hand. The Company
              maintains its bank accounts at several financial institutions
              which, at times, may exceed Federal Deposit Insurance Corporation
              ("FDIC") insured limits. In addition, the Company's foreign cash,
              aggregating $818 at December 31, 1999, is not insured by the
              FDIC. The Company has not incurred any losses in such accounts
              and believes it is not exposed to any significant credit risk on
              cash.

              PROPERTY AND EQUIPMENT - Property and equipment is stated at cost
              less accumulated depreciation and amortization. The Company
              provides for depreciation and amortization using the
              straight-line method over the following estimated useful lives:

                                     F-8

<PAGE>

                    TRANS WORLD GAMING CORP. AND SUBSIDIARIES


NOTE 2 -      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

<TABLE>
<CAPTION>

                                                                   ESTIMATED
                              ASSETS                                USEFUL
                                                                     LIFE
               <S>                                                <C>
               Building and improvements                            45 years
               Gaming equipment                                   4-12 years
               Furniture, fixtures and other equipment             3-8 years

</TABLE>

              PRE-OPENING AND DEVELOPMENT COSTS - Pre-opening and development
              costs incurred in connection with the pursuit and development of
              new gaming projects in various jurisdictions are expensed as
              incurred.

              GOODWILL - Goodwill, which represents the excess of cost of
              acquired companies over the fair value of their net assets at
              dates of acquisition, is being amortized on a straight-line basis
              over 7 years.

              The carrying value of goodwill is periodically reviewed by the
              Company based upon the expected future undiscounted operating
              cash flows of the related business (SEE NOTE 9).

              FOREIGN CURRENCY TRANSLATION - For foreign subsidiaries whose
              functional currency is the local foreign currency, balance sheet
              accounts are translated at exchange rates in effect at the end of
              the year and statement of operations accounts and cash flows are
              translated at average exchange rates for the year. Resulting
              translation adjustments are included in accumulated other
              comprehensive income.

              LOSS PER COMMON SHARE - Loss per common share is based on the
              weighted average number of common shares outstanding.

              The Company complies with Statement of Financial Accounting
              Standards ("SFAS") 128, "Earnings Per Share", which requires dual
              presentation of basic and diluted earnings per share. Basic
              earnings per share excludes dilution and is computed by dividing
              income available to common stockholders by the weighted-average
              common shares outstanding for the year. Diluted earnings per
              share reflects the potential dilution that could occur if
              securities or other contracts to issue common stock were
              exercised or converted into common stock or resulted in the
              issuance of common stock that then shared in the earnings of the
              entity.

              Since the effect of outstanding warrants and options is
              antidilutive, they have been excluded from the Company's
              computation of loss per common share.

              INCOME TAXES - The Company complies with SFAS 109, "Accounting
              for Income Taxes", which requires an asset and liability
              approach to financial accounting and reporting for income taxes.
              Deferred income tax assets and liabilities are computed for
              differences between the financial statement and tax bases of
              assets and liabilities that will result in future taxable or
              deductible amounts, based on enacted tax laws and rates
              applicable to the periods in which the differences are expected
              to affect taxable income. Valuation allowances are established,
              when necessary, to reduce deferred tax assets to the amount
              expected to be realized.

              CASINO REVENUE - Casino revenue is the net win from gaming
              activities, which is the difference between gaming wagers less
              the amount paid out to patrons.

                                     F-9
<PAGE>

                    TRANS WORLD GAMING CORP. AND SUBSIDIARIES


NOTE 2 -      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

              PROMOTIONAL ALLOWANCES - Promotional allowances primarily consist
              of food and beverages furnished gratuitously to customers. For
              the years ended December 31, 1999 and 1998, revenues do not
              include the retail amount of food and beverage of $128 and $194,
              respectively, provided gratuitously to customers. The cost of
              these items of $55 and $82, respectively, is included in cost of
              revenues.

              FAIR VALUE OF FINANCIAL INSTRUMENTS - The fair values of the
              Company's assets and liabilities which qualify as financial
              instruments under SFAS No. 107, "Disclosures about Fair Value of
              Financial Instruments," approximate their carrying amounts
              presented in the consolidated balance sheet at December 31, 1999.

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

              IMPAIRMENT OF LONG-LIVED ASSETS - The Company periodically
              reviews the carrying value of its long-lived assets in relation
              to historical results, as well as management's best estimate of
              future trends, events and overall business climate. If such
              reviews indicate that the carrying value of such assets may not
              be recoverable, the Company would then estimate the future cash
              flows (undiscounted and without interest charges). If such
              future cash flows are insufficient to recover the carrying
              amount of the assets, then impairment is triggered and the
              carrying value of any impaired assets would then be reduced to
              fair value.

              RECLASSIFICATIONS - Certain prior year amounts have been
              reclassified to conform to the 1999 presentation.

              INVESTMENT CARRIED AT EQUITY - The Company's investment in
              Chrysolith is being accounted for under the equity method of
              accounting. Accordingly, the investment is recorded at cost and
              adjusted for the Company's proportionate share of undistributed
              earnings or losses (SEE NOTE 13).

              DEBT ISSUANCE COSTS - Costs incurred in connection with certain
              of the Company's debt financing were deferred and amortized on a
              straight-line basis over the term of the related debt.
              Amortization of debt issuance costs were $145 and $279 for the
              years ended December 31, 1999 and 1998, respectively.


NOTE 3 -      BUSINESS COMBINATIONS

              On March 31, 1998, the Company acquired substantially all of the
              voting and non-voting interests of 21st Century Resorts a.s.
              ("Resorts"), a Czech Republic joint stock company, Resorts'
              subsidiaries and certain assets of companies affiliated with
              Resorts in a business combination accounted for as a purchase.
              Resorts, through its subsidiaries, operates three casinos in the
              Czech Republic including its newly-opened casino near Snojmo. The
              results of operations of Resorts have been included in the
              accompanying consolidated financial statements since the date of
              acquisition. The total cost of the acquisition of $12,356
              (including acquisition costs of $1,584) was allocated to the
              assets acquired and liabilities assumed based on their estimated
              fair values.

                                    F-10

<PAGE>

                    TRANS WORLD GAMING CORP. AND SUBSIDIARIES


NOTE 3 -      BUSINESS COMBINATIONS (CONTINUED)

              The excess of the total cost over the fair value of the net
              assets acquired (goodwill), $10,537, is being amortized on the
              straight-line basis over seven years.

              On April 17, 1998, the Company acquired 90% of the shares of
              Casino de Zaragoza, S.A. ("CDZ") in a business combination
              accounted for as a purchase. The results of operations of CDZ
              have been included in the accompanying consolidated financial
              statements since the date of acquisition. The total cost of the
              acquisition of $1,458 (including acquisition costs of $678) was
              allocated to the assets acquired and liabilities assumed based on
              their estimated fair values. Goodwill of $7,367 is being
              amortized on the straight-line basis over seven years.

              During the fourth quarter of 1998, the Company adjusted the
              carrying amount of goodwill as it relates to the Resorts and CDZ
              acquisitions by $2,500 and $1,500, respectively (SEE NOTE 9).

              The following summarized unaudited 1998 consolidated pro forma
              information assumes the 1998 acquisitions had occurred on January
              1, 1998.

<TABLE>

               <S>                                                     <C>
               Revenues                                                $     11,370
                                                                       ============
               Loss from continuing operations                         $    (11,705)
                                                                       ============
               Loss per common share from continuing operations,
                basic and diluted                                      $      (3.85)
                                                                       ============

</TABLE>

              The summarized unaudited 1998 consolidated pro forma results are
              not necessarily indicative of results which actually would have
              occurred if the acquisitions had actually occurred on January 1,
              1998. Further, the summarized unaudited 1998 consolidated pro
              forma results are not intended to be a projection of future
              results and do not reflect any integration costs or cost savings
              resulting from synergistic opportunities.


NOTE 4 -      PROPERTY AND EQUIPMENT

              At December 31, 1999, property and equipment consists of the
              following:

<TABLE>

               <S>                                                     <C>
               Land                                                    $       1,121
               Building and improvements                                       1,519
               Gaming equipment                                                1,650
               Furniture, fixtures and other equipment                         1,732
               Construction in progress                                          217
                                                                       -------------
                                                                               6,239
               Less accumulated depreciation and amortization                  1,127
                                                                       -------------
                                                                       $       5,112
                                                                       =============

</TABLE>

                                    F-11

<PAGE>

                    TRANS WORLD GAMING CORP. AND SUBSIDIARIES


NOTE 5 -      LONG-TERM DEBT

              At December 31, 1999, long-term debt consists of the following:

<TABLE>

               <S>                                                     <C>
               12% Senior Secured Promissory Notes (a) (d)             $      17,000
               12% Secured Convertible Senior Bonds (b)                        4,800
               12% Senior Secured Note due March 17, 2005 (c) (d)              3,000
                                                                       -------------
                                                                              24,800
               Less unamortized debt discount                                 (4,251)
                                                                       -------------
                                                                       $      20,549
                                                                       =============

</TABLE>

              (a) In March 1998, the Company borrowed $17,000 ($9,000 from
                  Value Partners, Ltd. - "Value Partners") in a private
                  placement ("March 1998 Private Placement"). The loan is
                  represented by 12% Senior Secured Notes ("March 1998 Senior
                  Notes") issued pursuant to indentures by and among the
                  Company and an independent indenture trustee. The March 1998
                  Senior Notes, which are due March 2005, require mandatory
                  prepayments based upon excess cash flows generated from
                  Resorts. The March 1998 Senior Notes are collateralized by
                  substantially all of Resort's gaming equipment and a
                  majority interest in the capital stock of all of the
                  Company's subsidiaries (except CDZ). In addition to the
                  March 1998 Senior Notes, each investor received a
                  proportionate share of warrants to purchase 7,087 shares of
                  the Company's common stock (SEE NOTE 11).

                  The indentures were amended in October 1998 in connection
                  with the restructuring of the Company's ownership of Resorts
                  as a result of a 1998 change in Czech gaming law which
                  restricted foreign ownership of Czech casinos. The amended
                  indentures did not alter the underlying basis of the March
                  1998 Senior Notes.

                  Of the $17,000 principal amount of notes and warrants issued
                  in the March 1998 Private Placement, the Company has
                  allocated approximately $4,700 as the estimated value of the
                  warrants issued with the notes. This amount is being
                  amortized as additional interest expense with a
                  corresponding increase to notes payable over the lives of
                  the respective notes using the effective interest method
                  until such notes are repaid. At December 31, 1999
                  approximately $1,054 has been amortized and the remaining
                  balance of approximately $3,646 at December 31, 1999 is
                  reflected as a reduction of notes payable.

              (b) As a condition to the March 1998 Private Placement, the
                  Company was required to renegotiate the terms and conditions
                  of the 12% Secured Convertible Senior Bonds ("Senior Bonds")
                  originally due June 30, 1999. In March 1998, the Company and
                  the holders of the Senior Bonds agreed to amend such
                  indebtedness as follows: (i) the principal and interest
                  obligations was to be paid only from excess cash flow
                  generated from the terminated Louisiana operations and
                  Bishkek operations; (ii) the maturity date was extended to
                  December 31, 2005; (iii) the ability to convert the Senior
                  Bonds into the Company's common stock was terminated; (iv)
                  the holders of the Senior Bonds received Series A warrants
                  and Series B warrants (SEE NOTE 11). Value Partners hold
                  $3,000 of the Senior Bonds. The Senior Bonds were
                  collateralized by all of the Company's Louisiana assets.

                                     F-12

<PAGE>

                    TRANS WORLD GAMING CORP. AND SUBSIDIARIES


NOTE 5 -      LONG-TERM DEBT (CONTINUED)

              (c) In October 1999, the Company borrowed $3,000 ($2,700 from
                  Value Partners) in a private placement ("October 1999 Private
                  Placement"). The loan is represented by 12% Senior Secured
                  Notes ("October 1999 Senior Notes") issued pursuant to
                  indentures by and among the Company and an independent
                  indenture trustee. The October 1999 Senior Notes, which are
                  due March 2005, require mandatory prepayments based upon
                  excess cash flows generated from Resorts. The October 1999
                  Senior notes are collateralized by primarily all of Resort's
                  gaming equipment and a majority interest in the capital stock
                  of all of the Company's subsidiaries (except CDZ). In
                  addition to the October 1999 Senior Notes, each investor
                  received a proportionate share of warrants to purchase 1,251
                  shares of the Company's common stock (SEE NOTE 11).

                  Of the $3,000 principal amount of notes and warrants issued
                  in the October 1999 Private Placement, the Company has
                  allocated approximately $625 as the estimated value of the
                  warrants issued with the notes. This amount is being
                  amortized as additional interest expense with a
                  corresponding increase to notes payable over the lives of
                  the respective notes using the effective interest method
                  until such notes are repaid. At December 31, 1999,
                  approximately $20 has been amortized and the remaining
                  balance of approximately $605 at December 31, 1999 is
                  reflected as a reduction to notes payable.

              (d) The Company was not in compliance with certain covenants in
                  certain of its long-term debt obligations. In March 2000, the
                  Company received waivers on the defaults from the holder of
                  the majority in interest of those debt instruments (Value
                  Partners) (SEE NOTE 15).


NOTE 6 -      ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

              At December 31, 1999, accrued expenses and other current
              liabilities consists of the following:

<TABLE>

               <S>                                                     <C>
               Taxes payable to Spanish Taxing
                Authorities (SEE NOTE 7)                               $       1,315
               Accrued interest                                                1,399
               Other                                                           1,054
                                                                       -------------
                                                                       $       3,768
                                                                       =============

</TABLE>


NOTE 7 -      COMMITMENTS AND CONTINGENCIES

              LEASE OBLIGATIONS - The Company is obligated under operating
              leases relative to its various facilities expiring through 2010.

              Future aggregate minimum annual rental payments under all of
              these leases for the next five years are as follows:

<TABLE>

                                 <S>                                        <C>
                                 2000                                       464
                                 2001                                       442
                                 2002                                       444
                                 2003                                       418
                                 2004                                       410

</TABLE>

                                                   F-13

<PAGE>

                    TRANS WORLD GAMING CORP. AND SUBSIDIARIES


NOTE 7 -      COMMITMENTS AND CONTINGENCIES (CONTINUED)

              Rent expense under these leases amounted to approximately $120
              for each of the years ended December 31, 1999 and 1998.

              EMPLOYMENT AGREEMENTS - The Company has entered into employment
              agreements with certain of its executives which provide for
              annual compensation plus, in most cases, participation in future
              benefit programs and stock option plans. Future annual
              compensation under these employment agreements is as follows:

<TABLE>

                                 <S>                             <C>
                                 2000                            $        733
                                 2001                                     590
                                 2002                                     157
                                                                 ------------
                                                                 $      1,480
                                                                 ============

</TABLE>

              CONSULTING AGREEMENTS - The Company is obligated to pay a certain
              percentage of future revenues of its newly-opened Czech casino
              pursuant to a thirty year consulting contract.

              CONTINGENCIES - The Company is involved in certain legal actions
              that arose in the normal course of business. In the opinion of
              the Company's management, the resolution of these matters will
              not have a material adverse effect on the consolidated financial
              position, results of operations or cash flows of the Company.

              FOREIGN ACTIVITIES - During the years ended December 31, 1999 and
              1998, a substantial amount of the Company's operations are
              outside of the United States (SEE NOTE 13). Operating
              internationally involves additional risks relating to such
              things as currency exchange rates, different legal and
              regulatory environments, political and economic risks relating
              to the stability or predictability of foreign governments,
              differences in the manner in which different cultures do
              business, difficulties in staffing and managing foreign
              operations, differences in financial reporting, operating
              difficulties, different types of criminal threats and other
              factors. The occurrence of any of these risks, if severe enough,
              could have a material adverse effect on the consolidated
              financial condition, results of operations and cash flows of the
              Company.

              COLLECTIVE AGREEMENT - The Company has yet to sign the collective
              agreement with its Spanish workforce for the years 1994 through
              1999. In the opinion of the Company's management, the resolution
              of this matter will not have a material adverse effect on the
              consolidated financial position, results of operations or cash
              flows of the Company.

              TEMPORARY RECEIVERSHIP - On January 25, 1997 (prior to the
              Company's acquisition of 90% of CDZ), the directors of CDZ filed
              an application in Court of First Instance number 11 of Zaragoza
              to declare CDZ in temporary receivership. Temporary receivership
              was granted on June 23, 1997.

                                     F-14

<PAGE>

                    TRANS WORLD GAMING CORP. AND SUBSIDIARIES


NOTE 7 -      COMMITMENTS AND CONTINGENCIES (CONTINUED)

              On April 17, 1998 (the date of the Company's acquisition of 90%
              of CDZ), CDZ signed a composition with creditors, most notably
              the DGA, the Spanish Social Security Authorities and the City
              Council of Alfajarin ("Spanish Taxing Authorities"-SEE NOTES 6
              AND 9), which set the terms of payment to the Spanish Taxing
              Authorities and other creditors for debts existing as of January
              25, 1997. The composition with the Spanish Taxing Authorities
              and other creditors resulted in a debt reduction of
              approximately $1,743. This reduction was accounted for as a
              reduction of goodwill.

              During the years ended December 31, 1999 and 1998, DGA granted
              the Company a deferral of approximately $1,784 in taxes on gaming
              winnings accruing during 1997-1999. Furthermore, in April 1999,
              the Company reached an agreement with the Spanish Social Security
              Authorities to defer approximately $1,211 related to all debts
              generated in 1997 and the first quarter of 1998.

              At December 31, 1999, taxes payable to Spanish Taxing Authorities
              consists of the following:

<TABLE>

                  <S>                                                  <C>
                  Gaming tax                                           $       4,369
                  Property tax                                                   683
                  Social security                                              1,470
                  Other                                                          553
                                                                       -------------
                                                                               7,075
                  Less current portion                                         1,315
                                                                       -------------
                  Long-term portion                                    $       5,760
                                                                       =============

</TABLE>

              Included in deposits and other assets on the accompanying
              December 31, 1999 consolidated balance sheet is $61 of restricted
              cash guaranteeing the social security tax obligation.

              Future aggregate payments to the Spanish Taxing Authorities are
              due as follows (excluding interest):

<TABLE>

                       <S>                                             <C>
                       YEAR ENDING DECEMBER 31,
                                 2000                                  $       1,315
                                 2001                                          1,258
                                 2002                                            468
                                 2003                                            468
                                 2004                                          1,249
                            Thereafter (through 2009)                          2,317
                                                                       -------------
                                                                       $       7,075
                                                                       =============

</TABLE>

              If the Company does not make its payments according to the
              schedule and is unable to obtain further deferral from the
              Spanish Taxing Authorities, the debt would become immediately
              payable and revert to pre-receivership levels. Management has
              indicated that, based on its discussions with Spanish Taxing
              Authorities, further deferral of payments until April 2001 is
              anticipated.

                                     F-15

<PAGE>

                    TRANS WORLD GAMING CORP. AND SUBSIDIARIES


NOTE 7 -      COMMITMENTS AND CONTINGENCIES (CONTINUED)

              TAXING JURISDICTION - The Czech Republic currently has a number
              of laws related to various taxes imposed by governmental
              authorities. Applicable taxes include value added tax ("VAT"),
              corporate tax, and payroll (social) taxes, together with others.
              In addition, laws related to these taxes have not been in force
              for significant periods, in contrast to more developed market
              economies; therefore, regulations are often unclear or
              nonexistent. Accordingly, few precedents with regard to issues
              have been established. Often, differing opinions regarding legal
              interpretations exist both among and within government
              ministries and organizations, thus, creating uncertainties and
              areas of conflict. Tax declarations, together with other legal
              compliance areas (as examples, customs and currency control
              matters) are subject to review and investigation by a number of
              authorities, who are enabled by law to impose extremely severe
              fines, penalties and interest charges. These facts create tax
              risks in the Czech Republic substantially more significant than
              typically found in countries with more developed tax systems.
              Management believes that it has adequately provided for tax
              liabilities.


NOTE 8 -      STOCKHOLDERS' DEFICIT

              In December 1998, the Company issued 320 shares of its common
              stock in settlement of unsecured notes payable, and accrued
              interest to its president and chief executive officer and his
              spouse aggregating $240.

              In March 1998 and October 1999, in connection with the issuance
              of certain debt instruments (SEE NOTE 5), the Company has
              allocated $4,700 and $625, respectively, as the estimated value
              of the warrants issued with the debt instruments. Upon surrender
              of a warrant, the holder is entitled to purchase one share of
              the Company's common stock for $.01. The warrants expire on
              various dates through March 31, 2008.

              During 1999, certain Series C and Series E warrant holders
              exercised warrants to purchase 2,001 shares of the Company's
              common stock.


NOTE 9 -      OTHER MATTERS

              PREPAID EXPENSES AND OTHER CURRENT ASSETS - Included in prepaid
              expenses and other current assets at December 31, 1999 is a VAT
              receivable from the Czech taxing authorities of $452 and other
              items aggregating $318.

              LICENSE BOND - Included in deposits and other assets at December
              31, 1999 is approximately $612 in restricted deposits relating to
              Czech license bond requirements.

              SHORT-TERM DEBT - At December 31, 1999, short-term debt consisted
              of a working capital loan payable in installments through April
              2000. The debt, which is collateralized by the Company's casino
              in Rozvadov and guaranteed by Resorts, bears interest at
              approximately 10% and is subject to certain covenants.

              OTHER LONG-TERM LIABILITIES - Included in other long-term
              liabilities at December 31, 1999 are taxes payable to Spanish
              Taxing Authorities of $5,760 (see Note 7) and other items
              aggregating $210.

                                     F-16

<PAGE>

                    TRANS WORLD GAMING CORP. AND SUBSIDIARIES


NOTE 9 -      OTHER MATTERS (CONTINUED)

              SETTLEMENTS - In connection with various legal proceedings
              related to the Company's sublease agreement with Prime
              Properties, Inc. (the lessor of the Gold Coin facility) which
              includes the right to operate its gaming license, the Company
              negotiated settlements by and amongst the involved parties.
              Under the terms of the settlement, the Company made a settlement
              payment of $450.

              In connection with an action brought by a former affiliate,
              alleging the Company's breach of a management contract, the
              Company executed a Mutual Release and Settlement Agreement
              whereby the Company paid the former affiliate $100 in exchange
              for release of all claims against it.

              Settlement charges in connection with the preceding legal
              proceedings have been reflected in selling, general and
              administrative expenses in the accompanying 1998 consolidated
              statement of operations.

              PROVISION FOR IMPAIRMENT - In light of certain 1998
              developments, in accordance with its policy on impairment of
              long-lived assets, the Company adjusted the carrying amounts of
              its goodwill as it relates to the Resorts and CDZ acquisitions
              by $2,500 and $1,500, respectively, during the fourth quarter of
              1998. However, the Company's management believes that, as a
              result of (i) improved revenues in all of its Czech and Spanish
              casinos, (ii) the December 1999 opening of its third Czech
              casino and (iii) positive developments regarding the relocation
              of the Spanish casino, further adjustment is not warranted in
              1999.

              In 1998, the Company further wrote-down the value of its
              DeRidder, Louisiana land by $192. During the year ended December
              31, 1999, the Company sold this land and related property for
              $295.

              WRITE-OFFS - During 1998, the President of the Azerbaijan
              Republic ordered the closure of all casinos in the Republic
              resulting in the write-off of the Company's unamortized
              investment in the Boxer Casino of approximately $295.
              Additionally, during 1998, in light of mounting losses and
              unrealistic future prospects, the Company wrote-off its
              investment in the Bishkek Casino of approximately $264. Other
              1998 write-offs include $204 of receivables from Chrysolith.

              RECAPITALIZATION - Pursuant to Spanish law, in order to maintain
              solvency, a Spanish entity must maintain a defined minimum
              capitalization. In October 1999, the Company adjusted CDZ's
              capital to zero and simultaneously increased it to 250,000
              pesetas (approximately $1,576). As a result of the October 1999
              recapitalization, the Company owns 99.92% of CDZ, as a result of
              CDZ's prior owner not subscribing to the new shares in the
              recapitalization process.


NOTE 10 -     INCOME TAXES

              At December 31, 1999, the Company's deferred income tax asset is
              comprised of the tax benefit (cost) associated with the following
              based on the statutory tax rates currently in effect:

                                     F-17

<PAGE>

                    TRANS WORLD GAMING CORP. AND SUBSIDIARIES

<TABLE>
<CAPTION>
                                                    U.S.           FOREIGN          TOTAL
                                                    ----           -------          -----
               <S>                              <C>             <C>             <C>
               Deferred tax assets
                Loss carryforwards              $     3,407     $     4,492     $     7,899
                Impairment                            2,801                           2,801
                Other                                                    52              52
                                                -----------     -----------     -----------
                                                      6,208           4,544          10,752
               Deferred tax liabilities                                 (11)            (11)
                                                -----------     -----------     -----------
               Deferred tax asset, gross              6,208           4,533          10,741

               Valuation allowances                  (6,208)         (4,533)        (10,741)
                                                -----------     -----------     -----------
               Deferred tax asset, net          $        --     $        --     $        --
                                                ===========     ===========     ===========

</TABLE>

              The following table presents the U.S. and foreign components of
              pretax loss from continuing operations before income taxes for
              the years ended December 31, 1999 and 1998:

<TABLE>

                                                               1999            1998
                                                               ----            ----
                           <S>                            <C>             <C>
                           U.S                            $    (4,400)    $    (8,562)
                           Foreign                             (1,787)         (1,938)
                                                          -----------     -----------
                                                          $    (6,187)    $   (10,500)
                                                          ===========     ===========

</TABLE>

              The 1998 provision for income taxes of $191 relates to earnings
              from certain of Resorts' wholly-owned subsidiaries, recognized
              under Czech tax laws, as separate reporting entities.

              The following table presents the principal reasons for the
              differences between the effective tax rate and the U.S. federal
              statutory income tax rate for the years ended December 31, 1999
              and 1998:

<TABLE>

                   <S>                                                 <C>         <C>
                   U.S federal statutory income tax rate               (34%)       (34%)
                   Effect of nondeductibility of goodwill
                    amortization and impairment                          10          19
                   Effect of net operating loss carryforwards
                    and valuation allowances, net                        29          15
                   Other                                                 (5)          2
                                                                        ----        ----
                                                                         - %          2%
                                                                        ====        ====

</TABLE>

                                     F-18

<PAGE>


                        TRANS WORLD GAMING CORP. AND SUBSIDIARIES

              At December 31, 1999, the Company had net operating loss
              carryforwards available for income tax reporting purposes
              of approximately:

<TABLE>

                   <S>                                      <C>
                   U.S                                      $ 8,735
                   Foreign                                   12,857
                                                            -------
                                                            $21,592
                                                            =======

</TABLE>

              The U.S. net operating loss carryforwards expire between 2009 and
              2019. The foreign net operating loss carryforwards expire between
              2002 and 2009.


NOTE 11 -     WARRANTS AND STOCK OPTIONS

              WARRANTS

              In connection with the October 1999 Private Placement (SEE NOTE
              5), the Company issued Series G Warrants to purchase 1,251 shares
              of the Company's common stock with an exercise price of $.01 per
              share expiring March 31, 2008.

              In connection with the March 1998 Private Placement including the
              restructuring of certain long-term debt obligations (SEE NOTE 5),
              the Company issued the following series of warrants to purchase
              the Company's common stock:

                 Series A Warrants - consists of warrants to purchase 960
                 shares of the Company's common stock with an exercise price of
                 $1.00 per share expiring on December 31, 2005. These warrants
                 were issued to replace warrants in connection with the
                 issuance of convertible senior bonds dated July 1, 1996.

                 Series B Warrants - consists of warrants to purchase 3,200
                 shares of the Company's common stock with an exercise price of
                 $1.50 per share expiring on December 31, 2005. These warrants
                 were issued to replace conversion rights in connection with
                 the convertible senior bonds dated July 1, 1996.

                 Series C Warrants - consists of warrants to purchase 7,087
                 shares of the Company's common stock with an exercise price of
                 $.01 per share expiring on March 31, 2008. These warrants were
                 issued pursuant to the March 1998 Private Placement.

                 Series D Warrants - consists of warrants to purchase 2,052
                 shares of the Company's common stock with an exercise price of
                 $.01 per share expiring on March 31, 2008. These warrants were
                 issued to replace 500 warrants containing anti-dilution
                 provisions issued in connection with a September 1996
                 financing.

                 Series E Warrants - consists of warrants to purchase 354
                 shares of the Company's common stock with an exercise price
                 of $.01 per share expiring on March 31, 2008.


                                      F-19


<PAGE>

                        TRANS WORLD GAMING CORP. AND SUBSIDIARIES

NOTE 11 -     WARRANTS AND STOCK OPTIONS (CONTINUED)

                 These warrants were issued to the placement agent and its
                 affiliates pursuant to the March 1998 Private Placement.

              In connection with a March 1998 debt financing to fund the
              Bishkek Casino transaction (SEE NOTE 1), the Company issued
              warrants to purchase 104 shares of the Company's common stock
              with an exercise price of $.01 per share expiring on March 31,
              2008.

              All of the warrants issued in 1998 contain certain demand
              registration rights provided that the holders of such warrants
              hold in excess of 100 shares. The Series C and E Warrants also
              contain anti-dilution provisions.

              For the years ended December 31, 1999 and 1998, warrant activity
              is as follows:

<TABLE>
<CAPTION>

                 PRICE     BALANCE,                        BALANCE,                                     BALANCE,
                  PER     JANUARY 1,  GRANTED  EXPIRED   DECEMBER 31,  GRANTED    EXERCISED  EXPIRED   DECEMBER 31,
                 SHARE       1998       1998    1998         1998        1999        1999      1999        1999
                ------    ----------  -------  -------   ------------  -------    ---------  -------   ------------
              <S>         <C>         <C>      <C>       <C>           <C>        <C>        <C>       <C>

              $  13.50         151                              151                            (151)
                 11.55         151                              151                            (151)
                  8.50       1,511                            1,511                          (1,511)
                  1.50                 3,200                  3,200                                         3,200
                  1.00         960       960     (960)          960                                           960
                  0.59         250                              250                                           250
                  0.50         131        90                    221                            (221)
                  0.01         500     9,598     (500)        9,598      1,251     (2,001)                  8,848
                             -----    ------   ------        ------      -----     ------    ------        ------
                             3,654    13,848   (1,460)       16,042      1,251     (2,001)   (2,034)       13,258
                             =====    ======   ======        ======      =====     ======    ======        =======

</TABLE>

              All warrants outstanding at December 31, 1999 are exercisable.

              STOCK OPTION PLANS

              The Company has incentive and nonstatutory stock option plans
              under which certain key employees may purchase up to a total of
              2,000 common shares of the Company. Under the incentive stock
              option plan, the exercise price cannot be less than the fair
              market value of a share on the date of grant or at 110 percent of
              the fair market value on the date of grant, if, any employee owns
              more than 10 percent of the total combined voting power of all
              classes of outstanding stock of the Company. In addition, the
              incentive stock option plan provided for automatic grant of an
              option to purchase 2 shares of common stock to non-employee
              directors on a quarterly basis. In the case of a nonstatutory
              stock option, the exercise price may be any amount determined by
              the Board on the date of grant, but not less than the par value
              of the stock subject to the option.

              During 1999, in light of diminishing shares remaining available
              for grant to non-employee directors, the Company's Board of
              Directors approved the 1999 Non-Employee Director Stock Option
              Plan (the "1999 Plan"). Under the 1999 Plan, an aggregate of 250
              shares of the Company's common stock were reserved for issuance
              pursuant to options issued pursuant to the 1999 Plan. The 1999
              Plan provides for an automatic grant of an option to purchase 2
              shares of common stock to non-employee directors on a quarterly
              basis. Under the 1999 Plan, the exercise price shall equal the
              fair

                                      F-20


<PAGE>

                        TRANS WORLD GAMING CORP. AND SUBSIDIARIES

NOTE 11 -     WARRANTS AND STOCK OPTIONS (CONTINUED)

              market value of the Company's common stock on the date of grant.
              Options issued under the 1999 Plan shall be immediately
              exercisable over ten years.

              The activity in the stock option plans is as follows:

<TABLE>
<CAPTION>

                                                       EXERCISE PRICE PER SHARE
                                               NUMBER OF                       WEIGHTED
                                                OPTIONS       RANGE            AVERAGE
                                                -------       -----            -------
                     <S>                        <C>         <C>                <C>

                     Balance outstanding,
                       January 1, 1997           573        $ .91-9.00         $  4.64
                     Granted                     267          .30-2.00            0.56
                     Expired                    (320)             7.00            7.00
                                                 ---        ----------         -------
                     Balance outstanding,
                       January 1, 1998           520          .30-9.00            1.09
                     Granted                     125           .24-.63            0.25
                     Expired                      (6)         .30-1.59            0.80
                                                 ---        ----------         -------
                     Balance outstanding,
                       December 31, 1998         639          .24-9.00            0.93
                     Granted                     131           .24-.83            0.50
                                                 ---        ----------         -------
                     Balance outstanding,
                       December 31, 1999         770        $ .24-9.00        $   0.86
                                                 ===        ==========        ========
                     Exercisable,
                       December 31, 1999         639        $ .24-9.00        $   0.93
                                                 ===        ==========        ========

</TABLE>

              There were no options exercised during 1999 or 1998. The option
              price per share was equal to or above the market value of the
              underlying stock on the date of grant. Options generally expire
              between five and ten years after the date of grant or earlier
              upon termination as defined in the plans.

              The Company complies with the disclosure-only provisions of
              SFAS 123, "Accounting for Stock-Based Compensation".



                                      F-21
<PAGE>

                        TRANS WORLD GAMING CORP. AND SUBSIDIARIES

NOTE 11 -     WARRANTS AND STOCK OPTIONS (CONTINUED)

              The Company applies APB Opinion No. 25 and related interpretations
              in accounting for its stock option plans and, accordingly, no
              compensation cost has been recognized because stock options
              granted under the plans were at exercise prices which were equal
              to or above the market value of the underlying stock at date of
              grant. Had compensation expenses been determined as provided by
              SFAS 123 using the Black-Scholes option-pricing model, the pro
              forma effect on the Company's net loss and per share amounts would
              have been:

<TABLE>
<CAPTION>
                                                                1999              1998
                <S>                                         <C>               <C>

                Net loss
                  As reported                               $   (6,409)       $  (10,729)
                  Pro forma                                     (6,469)          (10,759)

                Loss per common share,
                 basic and diluted
                  As reported                               $    (1.78)       $    (3.52)
                  Pro forma                                      (1.80)            (3.53)

</TABLE>

              The fair value of each option grant is calculated using the
              following weighted average assumptions:

<TABLE>
<CAPTION>
                                                            1999            1998
                <S>                                         <C>             <C>

                Expected life (years)                            5               5
                Risk-free rate                                   5%              5%
                Volatility                                     154%            275%
                Dividend yield                                   0%              0%

</TABLE>

NOTE 12 -     INFORMATION CONCERNING GEOGRAPHIC AREAS

              During the years ended December 31, 1999 and 1998, the Company
              operated principally in three geographic areas: the United States,
              the Czech Republic and Spain. The following table presents
              information about the Company by geographic area. There were no
              material amounts of sales or transfers among geographic areas.

<TABLE>
<CAPTION>
                                      UNITED      CZECH
                                      STATES     REPUBLIC      SPAIN      OTHER     ELIMINATIONS  CONSOLIDATED
                                     ---------   ---------    --------    --------  ------------  ------------
                 <S>                 <C>         <C>          <C>         <C>       <C>            <C>
                   1999
                 Revenues             $  5,549    $  8,250    $  3,877    $    167    $ (2,519)    $   15,324
                 Long-lived assets           9      10,475       4,711         346                     15,541

                   1998
                 Revenues             $  6,114    $  5,466    $  2,778    $  1,080    $   (359)    $   15,079
                 Long-lived assets         184      10,524       5,444         441                     16,593

</TABLE>

                                      F-22
<PAGE>


                        TRANS WORLD GAMING CORP. AND SUBSIDIARIES

NOTE 13 -     SUMMARIZED FINANCIAL INFORMATION

              The Company has a nonvoting 49% interest in Chrysolith and entered
              into an agreement with Chrysolith pursuant to which Chrysolith
              owns, maintains and operated (through June 30, 1999) the video
              lottery terminals at the Gold Coin and Toledo Palace properties.

              Prior to July 1, 1999, the Company received 100% of the net
              operating revenues (the "Net Win") derived from the Gold Coin and
              the Toledo Palace, after payment of all the gaming taxes payable
              to the State of Louisiana and payout of winnings from the gaming
              establishments. Further, the Company paid a management fee to
              Chrysolith in an amount equal to the direct operating expenses of
              the gaming establishment. A summary of the December 31, 1999 and
              1998 financial information of Chrysolith is as follows:

<TABLE>
<CAPTION>

                                                  1999    1998
                                                  ----    ----

                  <S>                             <C>     <C>
                  Assets                          $291    $442
                  Liabilities                      216     367
                  Stockholders' equity              75      75
                  Net income                         -       -

</TABLE>

NOTE 14 -     DISCONTINUED OPERATIONS

         The Company's United States gaming operations ceased as of June 30,
         1999. Summary operating results of discontinued operations for the
         years ended December 31, 1999 and 1998 is as follows:

<TABLE>

         <S>                                      <C>            <C>
         REVENUES                                 $ 3,030        $ 6,063
                                                  -------        -------
         COSTS AND EXPENSES
          Cost of revenues                          1,506          2,879
          Depreciation and amortization               145            285
          Selling general and administrative        1,025          1,903
          Provision for impairment                                   192
          Write-offs                                                 204
                                                  -------        -------
                                                    2,676          5,463
                                                  -------        -------
         INCOME FROM OPERATIONS                       354            600
         INTEREST                                     576            638
                                                  -------        -------
                                                  $  (222)       $   (38)
                                                  =======        =======

</TABLE>

NOTE 15-      SUBSEQUENT EVENTS

              In March 2000, the Company received waivers on all defaults under
              the March 1998 Senior Notes and October 1999 Senior Notes.

              In March 2000, the Company executed an approximate $550,000 Czech
              bank note payable in equal monthly payments through September
              2001. The bank note bears interest at approximately 10.5% per
              annum and is collateralized by certain Czech property.

                                      F-23


<PAGE>


                    TRANS WORLD GAMING CORP. AND SUBSIDIARIES




                            CASINO DE ZARAGOZA, S.A.




-------------------------------------------------------------------------------
                          CONSOLIDATED ANNUAL ACCOUNTS
                             AS OF DECEMBER 31, 1999
                         TOGETHER WITH AUDITORS' REPORT
-------------------------------------------------------------------------------












                                      F-24


<PAGE>


                    TRANS WORLD GAMING CORP. AND SUBSIDIARIES
                    CASINO DE ZARAGOZA, S.A. AND SUBSIDIARIES
               CONSOLIDATED BALANCE SHEET AS OF DECEMBER 31, 1999

<TABLE>
<CAPTION>

                                                                    U.S.       THOUSANDS
                                                                  DOLLARS      OF PESETAS
                                                                ----------     ----------
<S>                                                             <C>            <C>

                                   ASSETS

CURRENT ASSETS
    Cash and cash equivalents                                      165,457         27,403
    Short-Term financial investments                                65,560         10,858
    Due from affiliates (within TWG Group)                           3,743            620
    Accounts receivable (Note 4)                                    22,480          3,723
    Inventories                                                     13,803          2,286
    Prepaid expenses and other receivables                           5,585            925
                                                                ----------     ----------
       TOTAL CURRENT ASSETS                                        276,628         45,815
                                                                ----------     ----------
NON-CURRENT ASSETS

    Intangible assets, net (Note 5)                                  3,339            553
    Gross tangible assets (Note 6)                                 395,260         65,463
    Due from affiliates (within TWG Group) (Note 7)                900,000        149,058
    Other long-term                                                 60,862         10,080
                                                                ----------     ----------
       TOTAL NON-CURRENT ASSETS                                  1,359,461        225,154
                                                                ----------     ----------
                                TOTAL ASSETS                     1,636,089        270,969
                                                                ==========     ==========
                    LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
    Accounts payable, trade                                        190,195         31,500
    Accounts payable, affiliates (within TWG Group) (Note 7)       184,603         30,574
    Taxes (Note 8)                                               1,315,325        217,844
    Other current liabilities                                      135,539         22,448
                                                                ----------     ----------
       TOTAL CURRENT LIABILITIES                                 1,825,662        302,366
                                                                ----------     ----------
NON-CURRENT LIABILITIES
    Taxes (Notes 8 and 14)                                       5,760,524        954,058
    Long-term debt                                                 110,349         18,276
                                                                ----------     ----------
       TOTAL LONG-TERM DEBT                                      5,870,873        972,334
                                                                ----------     ----------
COMMITMENTS AND CONTINGENCIES (NOTE 9)                             135,877         22,504
                                                                ----------     ----------
MINORITY INTERESTS (NOTE 10)                                        74,121         12,276
                                                                ----------     ----------
SHAREHOLDERS' EQUITY
    Common Shares (Note 11)                                      1,509,480        250,000
    Accumulated losses                                          (7,087,349)      (997,973)
    Accumulative translation adjustment                          1,167,380             --
    Profit/Loss                                                 (1,859,955)      (290,538)
                                                                ----------     ----------
       TOTAL SHAREHOLDERS' EQUITY                               (6,270,444)    (1,038,511)
                                                                ----------     ----------
                 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY      1,636,089        270,969
                                                                ==========     ==========

</TABLE>

                                      F-25


<PAGE>

                    TRANS WORLD GAMING CORP. AND SUBSIDIARIES
                    CASINO DE ZARAGOZA, S.A. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENT OF OPERATIONS
                            AS OF DECEMBER 31, 1999

<TABLE>
<CAPTION>

                                                                    U.S.              THOUSANDS
                                                                   DOLLARS            OF PESETAS
                                                                   -------            ----------
<S>                                                             <C>                 <C>
REVENUES (NOTE 1)
    Gaming                                                          3,579,475              559,139
    Other revenues                                                    297,330               46,445
                                                                -------------       ---------------
                                                                    3,876,805              605,584
                                                                -------------       ---------------
COSTS AND EXPENSES
    Operating departments (Note 1)                                 (3,304,347)            (516,162)
    Selling, general and administrative (Note 7)                   (1,753,897)            (273,971)
    Depreciation and amortization                                     (78,210)             (12,217)
                                                                -------------       ---------------
                                                                   (5,136,454)            (802,350)
                                                                -------------       ---------------
LOSS FROM OPERATIONS                                               (1,259,649)            (196,766)
                                                                -------------       ---------------
OTHER INCOME (EXPENSE)
    Interest expenses                                                (161,273)             (25,192)
    Interest income                                                     5,397                  843
    Other, net                                                         71,745               11,207
                                                                -------------       ---------------
                                                                      (84,131)             (13,142)
                                                                -------------       ---------------
INCOME TAXES                                                          -                   -
NET LOSS BEFORE EXTRAORDINARY ITEM                                 (1,343,781)            (209,908)
                                                                -------------       ---------------
EXTRAORDINARY ITEMS, NET OF RELATED TAX EFFECT (NOTE 12)             (516,251)             (80,642)
                                                                -------------       ---------------
NET INCOME                                                         (1,860,032)            (290,550)
                                                                =============       ===============
LOSS ATTRIBUTABLE TO MINORITY INTERESTS                                 0,072                   12

INCOME ATTRIBUTABLE TO THE GROUP                                   (1,859,955)            (290,538)

LOSS PER SHARE BEFORE EXTRAORDINARY ITEM                              (537.51)              (83.96)
EXTRAORDINARY LOSS PER SHARE                                          (206.52)              (32.26)
LOSS PER SHARE (WEIGHTED AVERAGE SHARES: 2,500)                       (744.01)             (116.22)

</TABLE>

                                      F-26


<PAGE>


                    TRANS WORLD GAMING CORP. AND SUBSIDIARIES
                    CASINO DE ZARAGOZA, S.A. AND SUBSIDIARIES
          CONSOLIDATED STATEMENT OF CASH FLOWS AS OF DECEMBER 31, 1999

<TABLE>
<CAPTION>

                                                                   US DOLLARS       PESETAS
                                                                   ----------       -------
<S>                                                               <C>              <C>

CASH FLOW FROM OPERATING ACTIVITIES
  Net income (loss) before extraordinary items                    (1,343,781)      (209,908)
  Adjustments to reconcile net income to net cash provided
    by (used in) operating activities:
     Provision for allowance for doubtful accounts                   (22,124)        (3,456)
     Depreciation and amortization                                    78,210         12,217
     Unrealized net depreciation (appreciation) on investments             -              -
     (Gain) loss from investments in affiliates                            -              -
     Deferred income taxes                                                 -              -
     Minority interest                                                    72             12
     Changes in operating assets and liabilities:
      (Increase) decrease in investments                            (858,097)      (142,118)
      (Increase) decrease in account receivable                      153,858         25,482
      (Increase) decrease in account receivable, affiliates              350             58
      (Increase) decrease in inventories                             (13,803)        (2,286)
      (Increase) decrease in other current assets                      1,183            196
      (Increase) decrease in other assets                             58,562          9,699
      Increase (decrease) in account payable                          (5,042)          (835)
      Increase (decrease) in account payable affiliates             (136,034)       (22,530)
      Increase (decrease) in accrued expenses and other
        current liabilities                                          484,682         80,273
      Increase (decrease) in other long terms liabilities            649,777        107,616
                                                                  ----------     ----------
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES                 (952,186)      (145,580)
                                                                  ----------     ----------
CASH FLOW FROM OPERATING ACTIVITIES
  Payment for purchase of fixed assets                              (188,993)       (31,301)
  Proceeds form sale of fixed assets                                       -              -
  Payment for purchase of intangible assets                           (3,369)          (558)
  Payment for purchase of investments                                      -              -
                                                                  ----------     ----------
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES                 (192,362)       (31,859)
                                                                  ----------     ----------
CASH FLOW FROM FINANCIAL ACTIVITIES
  Proceeds from issuance of common stock                           1,509,479        250,000
  Minority interest                                                   74,121         12,276
                                                                  ----------     ----------
NET CASH PROVIDED BY (USED IN) FINANCIAL ACTIVITIES                1,583,600        262,276
                                                                  ----------     ----------
CASH FLOW FROM EXTRAORDINARY ACTIVITIES
  (Increase) decrease in extraordinary items                        (486,910)       (80,642)
                                                                  ----------     ----------
NET CASH PROVIDED BY (USED IN) EXTRAORDINARY ACTIVITIES             (486,910)       (80,642)
                                                                  ----------     ----------
TRANSLATION ADJUSTMENT                                                73,186
                                                                  ----------     ----------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                  25,329          4,195
CASH AND CASH EQUIVALENTS
  Beginning of the year                                              140,128         23,208
                                                                  ----------     ----------
  End of the year                                                    165,457         27,403
                                                                  ==========     ==========

</TABLE>

                                      F-27

<PAGE>


                    TRANS WORLD GAMING CORP. AND SUBSIDIARIES


                    CASINO DE ZARAGOZA, S.A. AND SUBSIDIARIES
                          NOTES TO FINANCIAL STATEMENTS
                                DECEMBER 31, 1999

(1)      DESCRIPTION OF BUSINESS

         Casino de Zaragoza, S.A. (hereinafter referred to as the Casino) was
         founded in 1978 and is located in Alfajarin (Zaragoza). The second
         article of the Casino's bylaws defines its corporate purpose,
         basically, as the operation of a gambling casino and appurtenant
         services, namely bar, restaurant, sitting rooms, show halls, night
         clubs, athletic facilities and shopping establishments located in the
         casino's building complex.

         Details of the Casino's holdings are as follows:

<TABLE>
<CAPTION>

             --------------------------------------------------------------------------------------
             Name                                 Catering y Gestion, S.L.   Los Albares, S.A.
             --------------------------------------------------------------------------------------
             <S>                                  <C>                      <C>
             Location                                Ctra. Nacional II       Ctra. Nacional II
                                                        Km. 343,250             Km. 343,250
                                                    Alfajarin (Zaragoza)   Alfajarin (Zaragoza)
             Line of business                             Lodging               Inoperative

                                                                     U.S. Dollars

             Proportion of stock held as of
               December 31, 1999                              100%               50.31%

             Capital stock as of December 31,
               1999                                       458,882               448,315

             Earnings/(Accumulated losses)
               as of December 31, 1999                   (835,648)             (299,004)

             Losses for the year ended
               December 31, 1999                         (271,748)                 (144)

                                                                 Thousands of Pesetas
             Proportion of stock held as of
               December 31, 1999                              100%               50.31%

             Capital stock as of December 31,
               1999                                        76,000                74,250

             Earnings/(Accumulated losses)
               as of December 31, 1999                   (138,400)              (49,521)

             Losses for the year ended
               December 31, 1999                          (45,007)                  (24)
             --------------------------------------------------------------------------------------
</TABLE>


                                      F-28

<PAGE>

                    TRANS WORLD GAMING CORP. AND SUBSIDIARIES

     This data was supplied by the Group companies, and their net worth is as
     shown in their unaudited annual accounts as of December 31, 1999.

     Up until October 1997, the properties and other assets needed to manage
     Catering y Gestion, S.L. were owned by and included in the book fixed
     assets of Casino de Zaragoza, S.A., which did not charge Catering y
     Gestion, S.L. for the use of those assets. In October 1997, Diputacion
     General de Aragon (the Aragon Provincial Council) acquired all of the
     properties that belonged to Casino de Zaragoza, S.A. through an auction
     (see Note 6). On May 28, 1998, the Company entered into a lease agreement
     with Diputacion General de Aragon in relation to the assets mentioned in
     the previous paragraph. This agreement is effective for six months from
     April 17, 1998, and automatically renewable for consecutive six-month
     periods unless either of the parties repudiates the agreement with a
     minimum of two months' notice. The amount was set at Ptas. 2,500,000
     thousand per month (including VAT).

     The Casino is subject to the regulations set forth in the Ministerial
     Order of January 9, 1979, which approved the Gambling Casino Regulations.

     The Casino holds a ten-year business license that is valid until December
     23, 2000.

(2)  BASIS OF PRESENTATION OF THE FINANCIAL STATEMENTS

     a)   ACCOUNTING POLICIES

          The accompanying financial statements as of December 31, 1999 were
          obtained from the accounting records and are presented in accordance
          with accounting principles generally accepted in the United States,
          which required certain adjustments and reclassifications to adapt the
          financial statements to US GAAP.

          All amounts are reported in local currency (thousands of pesetas) and
          in U.S. dollars. Assets and liabilities are translated using exchange
          rates published by Bank of Spain in effect at December 31, 1999.
          Revenues and expenses are translated using a monthly average exchange
          rate for the period. Resulting translation adjustments are recorded
          as a separate component of shareholders' equity.

          The following exchange rates were used to translate the financial
          statements as of December 31, 1999:


<TABLE>
<CAPTION>


                        --------------------------------------------------------------
                                                                    Ptas./U.S. Dollars
                                                                    ------------------
                        <S>                                         <C>
                        Balance Sheet Exchange Rate                      165,620

                        Profit and Loss Exchange Rate                    156,207
                        --------------------------------------------------------------


</TABLE>


     b)   CONSOLIDATION PRINCIPLES

          The accompanying consolidated accounts have been prepared from the
          accounting records of Casino de Zaragoza, S.A. and of the companies
          included in the consolidation (listed in Note 1), whose respective
          annual accounts were prepared by the directors of each company in
          accordance with accounting principles generally accepted in the
          United States, and give a true and fair view of the net worth,
          financial position and results of the Group. These consolidated
          accounts, which have been prepared by the directors of Casino de
          Zaragoza, S.A., and the

                                     F-29

<PAGE>

                    TRANS WORLD GAMING CORP. AND SUBSIDIARIES

          individual accounts of Casino de Zaragoza, S.A. and of each of the
          consolidated companies will be submitted to the respective Meetings
          of Shareholders for approval. It is anticipated that they will be
          approved without changes.

          All major intercompany balances and transactions have been eliminated
          on consolidation. The results of companies over which there is
          effective control through a majority of votes in their representative
          and decision-making bodies have been fully consolidated. Minority
          interests in the net worth and income of the consolidated companies
          are shown under "Minority interests" in the consolidated balance
          sheet and "Income (loss) attributable to minority interests" in the
          statement of consolidated income, respectively.

          The consolidated accounts do not provide for the tax effect of
          including in the parent company's books the results and reserves of
          the companies, because it is considered that reserves not taxable at
          source will not be transferred but used as funds to self-finance each
          consolidated company.

(3)  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     a)   USE OF ESTIMATES

          The preparation of the financial statements in conformity with
          generally accepted accounting principles requires management to make
          estimates and assumptions that affect the reported amounts of assets
          and liabilities and disclosures of contingent assets and liabilities
          at the date of the financial statements and the reported amounts of
          revenues and expenses during the reporting period. Actual results
          could differ from these estimates.

     b)   CURRENT ASSETS AND LIABILITIES

          Current assets are those assets which expect to be received within
          one year. Current liabilities are those liabilities which are
          expected to be paid within one year.

     c)   CASH AND CASH EQUIVALENTS

          Cash and cash equivalents include cash in hand and cash in bank
          current accounts, with original maturities of three months or less.

     d)   TANGIBLE FIXED ASSETS

          Tangible fixed assets are shown at cost.

     Expenditure on expansion, modernization or improvement is capitalized as
     an increased cost of the related assets provided that it increases
     productivity, capacity or efficiency, or extends the useful lives of these
     assets. Upkeep and maintenance costs are expensed currently.

          The Company depreciates its tangible fixed assets on a straight-line
          basis over the years of estimated useful life of each asset as
          follows:

                                     F-30

<PAGE>

                    TRANS WORLD GAMING CORP. AND SUBSIDIARIES

<TABLE>
<CAPTION>


                      ------------------------------------------------------------
                                                                     Years of
                                                                 estimated useful
                                                                       life
                                                                ------------------
                      <S>                                       <C>
                      Gaming equipment                                10 to 12
                      Tools                                            6 to 8
                      Furniture and fixtures                           8 to 25
                      Data processing equipment                           4
                      ------------------------------------------------------------



</TABLE>

     e)   NON-TRADE LOANS

          Long-term loans are recorded on the basis of the amount delivered.
          The difference between said amount and the face value of the loan is
          recorded according to the effective interest method as interest
          revenue. Interest receivable is recognized under assets in the
          balance sheet until actual collection.

     f)   INCOME TAXES

          Period corporate income tax is computed on the basis of book income
          before tax adjusted by the corresponding permanent differences with
          regard to the income for tax purposes, i.e. the corporate income tax
          base, less any abatements and tax credits, excluding withholdings and
          payments on account.

          The Casino accounts for income taxes in accordance with Statement of
          Financial Accounting Standards (`SFAS') No. 109 `Accounting for
          Income Taxes'. SFAS 109 requires an asset and liability approach for
          financial accounting and reporting for income tax purposes. Under
          the asset and liability method, deferred income taxes are recognized
          on account of the consequences of timing differences and net
          operating carryforwards by applying the statutory tax rates
          applicable to future years. Valuation allowances are recorded when
          it is determined that realization of such amounts is not deemed more
          likely than not.

     g)   DEFERRED INDEMNITIES

          The Casino is obligated to compensate employees whom it dismisses, in
          certain circumstances, pursuant to ruling labor legislation. In 1997
          and 1998 the Casino dismissed some employees, as a result of which it
          is involved in various legal actions.

          The balance sheet as of December 31, 1999 does include provisions for
          Ptas. 10.4 million (US$ 62,855) for the liability which may result
          from the aforesaid dismissals (Note 9).

     h)   CASINO REVENUE

          Casino revenue is the net win from gaming activities, which is the
          difference between gaming wagers less the amount paid out to patrons,
          and the portion of customers' tips due to the Casino.

     i)   FOREIGN CURRENCY TRANSACTIONS

          Credits and debits denominated in foreign currency are translated
          into pesetas at the exchange rate ruling at the transaction date,
          and at year-end are valued at the rates of exchange then prevailing.
          Gains or losses from foreign currency transactions are reported in
          "Other income - Other, net".

                                     F-31

<PAGE>

                    TRANS WORLD GAMING CORP. AND SUBSIDIARIES

(4)  ACCOUNTS RECEIVABLE

     Accounts receivable (debtors) as of December 31, 1999 consist of the
     following:

<TABLE>
<CAPTION>


                  ---------------------------------------------------------------------------
                                                                        U.S.       Thousands
                                                                      Dollars      of Pesetas
                  ---------------------------------------------------------------------------
                  <S>                                                 <C>           <C>
                  Accounts Receivable                                  518,506       85,875
                  Less:
                   Allowance for Doubtful Accounts                    (496,026)     (82,152)
                                                                      --------     ----------
                                                                        22,480        3,723
                  ---------------------------------------------------------------------------



</TABLE>

The rollforward of the allowance for doubtful accounts is as follows:

<TABLE>
<CAPTION>


                  ----------------------------------------------------------------------------
                                                                         U.S.      Thousands
                                                                       Dollars     of Pesetas
                  ----------------------------------------------------------------------------
                  <S>                                                 <C>            <C>
                  ALLOWANCE FOR DOUBTFUL ACCOUNTS AS OF
                   DECEMBER 31, 1998                                   1,303,740     185,092
                  Bad debt expense for the period ended
                   December 31, 1999                                        -             -
                  Recoveries/other for the period ended
                   December 31, 1999                                     (20,867)     (3,456)
                  Effect of consolidation                               (599,596)    (99,305)
                  Other                                                   (1,080)       (179)
                  Translation adjustment                                (186,171)          -
                                                                       ---------     -------
                  ALLOWANCE FOR DOUBTFUL ACCOUNTS AS OF
                   DECEMBER 31, 1999                                     496,026      82,152
                  ----------------------------------------------------------------------------


</TABLE>

(5)  INTANGIBLE ASSETS

     Movement in the cost of the assets and the related accumulated
     depreciation was as follows:

<TABLE>
<CAPTION>


         ---------------------------------------------------------------------------------------
                                              December                 Translation    December
            U.S. Dollars                      31, 1998     Additions   Adjustment     31, 1999
         ---------------------------------------------------------------------------------------

         <S>                                  <C>            <C>        <C>          <C>
         Software                              144,291        3,369      (20,604)     127,056
         Accumulated depreciation             (117,039)     (23,391)      16,713     (123,717)
                                              --------     --------     --------     --------
                                                27,252      (20,022)      (3,891)       3,339
                                              --------     --------     --------     --------
         Other                                     725            -         (103)         622
         Accumulated depreciation                 (725)           -          103         (622)
                                              --------     --------     --------     --------
                                                     -            -            -            -
                                              --------     --------     --------     --------
         TOTAL:
         Cost                                  145,016        3,369      (20,707)     127,678
         Accumulated depreciation             (117,764)     (23,391)      16,816     (124,339)
                                              --------     --------     --------     --------
         TOTAL INTANGIBLE ASSETS - NET          27,252      (20,022)      (3,891)       3,339
         ---------------------------------------------------------------------------------------


</TABLE>


                                     F-32

<PAGE>

                    TRANS WORLD GAMING CORP. AND SUBSIDIARIES

<TABLE>
<CAPTION>


         ------------------------------------------------------------------
                                           December                December
         Thousands of Pesetas              31, 1998    Additions   31, 1999
         ------------------------------------------------------------------
         <S>                             <C>           <C>        <C>
         Software                          20,485         558      21,043
         Accumulated depreciation         (16,616)     (3,874)    (20,490)
                                          -------      ------     -------
                                            3,869      (3,316)        553
                                          -------      ------     -------

         Other                                103           -         103
         Accumulated depreciation            (103)          -        (103)
                                          -------      ------     -------
                                                -           -           -
                                          -------      ------     -------
         TOTAL:
         Cost                              20,588         558      21,146
         Accumulated depreciation         (16,719)     (3,874)    (20,593)
         ------------------------------------------------------------------
         TOTAL INTANGIBLE ASSETS - NET      3,869      (3,316)        553
         ------------------------------------------------------------------

</TABLE>

(6)  PROPERTY AND EQUIPMENT

     Movement in the cost of the assets and the related accumulated
     depreciation was as follows:

<TABLE>
<CAPTION>


    -------------------------------------------------------------------------------------------------
                                        December                        Translation       December
          U.S. Dollars                  31, 1998         Additions       adjustment        31, 1999
    -------------------------------------------------------------------------------------------------
    <S>                                 <C>              <C>             <C>              <C>
    Land                                    89,948           88,383(*)       (12,844)         165,487
                                        ----------       ----------       ----------       ----------

    Gaming equipment                       335,063           93,727          (47,846)         380,944
    Accumulated depreciation              (229,464)         (23,747)          32,767         (220,444)
                                        ----------       ----------       ----------       ----------
                                           105,599           69,980          (15,079)         160,500
                                        ----------       ----------       ----------       ----------

    Tools                                  158,554               --          (22,640)         135,914
    Accumulated depreciation              (149,110)          (4,196)          21,293         (132,013)
                                        ----------       ----------       ----------       ----------
                                             9,444           (4,196)          (1,347)           3,901
                                        ----------       ----------       ----------       ----------

    Furniture                            1,406,881            0,211         (200,897)       1,206,195
    Accumulated depreciation            (1,321,908)         (16,018)         188,759       (1,149,167)
                                        ----------       ----------       ----------       ----------
                                            84,973          (15,807)         (12,138)          57,028
                                        ----------       ----------       ----------       ----------

    Data Processing Equipment              137,373            6,672          (19,616)         124,429
    Accumulated depreciation              (131,993)          (2,940)          18,848         (116,085)
                                        ----------       ----------       ----------       ----------
                                             5,380            3,732             (768)           8,344
                                        ----------       ----------       ----------       ----------

    Other                                      500                -              (71)             500
    Accumulated depreciation                  (500)               -               71             (500)
                                        ----------       ----------       ----------       ----------
                                                 -                -                -                -
                                        ----------       ----------       ----------       ----------
    TOTAL:

    Cost                                 2,128,319          188,993         (303,914)       2,013,398
    Accumulated depreciation            (1,832,975)         (46,901)         261,738       (1,618,138)
    -------------------------------------------------------------------------------------------------
    TOTAL TANGIBLE ASSETS - NET            295,344          142,092          (42,176)         395,260
    -------------------------------------------------------------------------------------------------

</TABLE>

(*)  The effect of applying global integration procedures in the consolidation
     process

                                     F-33

<PAGE>


                        TRANS WORLD GAMING CORP. AND SUBSIDIARIES

<TABLE>
<CAPTION>


          ----------------------------------------------------------------------------------
                                                  December 31,                  December 31,
                 Thousands of Pesetas                 1998        Additions         1999
          ----------------------------------------------------------------------------------
          <S>                                       <C>            <C>          <C>

          Land                                        12,770         14,638(*)      27,408
                                                    --------       --------       --------

          Gaming equipment                            47,569         15,523         63,092
          Accumulated depreciation                   (32,577)        (3,933)       (36,510)
                                                    --------       --------       --------
                                                      14,992         11,590         26,582
                                                    --------       --------       --------

          Tools                                       22,510                        22,510
          Accumulated depreciation                   (21,169)          (695)       (21,864)
                                                    --------       --------       --------
                                                       1,341           (695)           646
                                                    --------       --------       --------

          Furniture                                  199,735             35        199,770
          Accumulated depreciation                  (187,672)        (2,653)      (190,325)
                                                    --------       --------       --------
                                                      12,063         (2,618)         9,445
                                                    --------       --------       --------

          Data Processing Equipment                   19,503          1,105         20,608
          Accumulated depreciation                   (18,739)          (487)       (19,226)
                                                    --------       --------       --------
                                                         764            618          1,382
                                                    --------       --------       --------

          Other                                           71              -             71
          Accumulated depreciation                       (71)             -            (71)
                                                    --------       --------       --------
                                                           -              -              -
                                                    --------       --------       --------
          TOTAL:

          Cost                                       302,158         31,301        333,459
          Accumulated depreciation                  (260,228)        (7,768)      (267,996)
          ----------------------------------------------------------------------------------
          TOTAL TANGIBLE ASSETS - NET                 41,930         23,533         65,463
          ----------------------------------------------------------------------------------
</TABLE>

          (*)  The effect of applying global integration procedures in the
               consolidation process

         In October 1997 Diputacion General de Aragon (the Aragon Provincial
         Council) auctioned off all the properties of the Casino, that had
         been mortgaged or which secured its debt in respect of gambling tax.
         The properties were auctioned off to settle debt for Ptas. 865
         million (US$ 6.1 million), while their net book value for the Casino
         was Ptas. 396 million (US$ 2.8 million). Ptas. 469 million (US$ 3.9
         million) in extraordinary revenues obtained on the auction were
         recorded in 1997 financial statements.

(7)      INTERCOMPANY TRANSACTIONS

         Intercompany accounts receivable and payable as of December 31, 1999
         were as follows:

<TABLE>
<CAPTION>

              ------------------------------------------------------------------------------
                                              U.S. Dollars           Thousands of Pesetas
                                      ------------- ------------- ------------- ------------
                                         Accounts      Accounts      Accounts     Accounts
                                        receivable     payable      receivable     payable
              ------------------------------------------------------------------------------
              <S>                     <C>           <C>           <C>            <C>

              Transworld Gaming           900,000       184,603       149,058        30,574
              ------------------------------------------------------------------------------
                                          900,000       184,603       149,058        30,574
              ------------------------------------------------------------------------------
</TABLE>

         In 1999, Casino de Zaragoza, S.A. granted a loan of US$ 900,000
         (Ptas. 142,738,000) to Trans World Gaming, its parent company. This
         loan falls due in 2002 and bears 3% interest. The difference between
         the amount granted and the amount recorded in the financial
         statements relates to variations in the exchange rate (Note 3-i).

                                      F-34


<PAGE>


                        TRANS WORLD GAMING CORP. AND SUBSIDIARIES

         The account payable relates to the outstanding balance of certain
         payments that the parent company made on behalf of Casino de
         Zaragoza, and payables in respect of services provided by the parent
         company, comprising management, internal audit, management control
         and the company's marketing under an agreement entered into between
         the parties on October 1, 1999 for the period running from April 1,
         1998. The amount recorded in this respect in 1999 amounted to Ptas.
         73,789 and is recorded under the "Costs and expenses - Selling,
         general and administrative" caption in the accompanying statement of
         income.

(8)      TAX MATTERS

         Set out below are the balances payable to the Spanish tax authorities:

<TABLE>
<CAPTION>

              ---------------------------------------------------------------------------------------------------------------------
                                                                                            U.S. Dollars
                                                             ----------------------------------------------------------------------
                                                                               Long term                            Short term
                                                             ----------------------------------------------------------------------
                                                              Temporary                                     Temporary
                                                             receivership        Other         Total       receivership      Other
              ---------------------------------------------------------------------------------------------------------------------
              <S>                                            <C>               <C>            <C>            <C>          <C>

              Diputacion General de Aragon
              -  Gambling tax                                   2,159,920      1,783,764      3,943,684        195,737      229,170

              City Council of Alfajarin:
              -  Tax on business activities, property tax         176,632              -        176,632         19,623      485,793

              Central tax authorities:
              -  Personal income tax                                    -        428,090        428,090              -      122,503
              -  Value added tax

              Social Security authorities                         719,684        490,985      1,210,669              -      260,427

              Other                                                     -          1,449          1,449              -        2,072
                                                                -------------------------------------------------------------------
                                                                3,056,236      2,704,288      5,760,524        215,360    1,099,965
              ---------------------------------------------------------------------------------------------------------------------
</TABLE>


<TABLE>
<CAPTION>

              ---------------------------------------------------------------------------------------------------------------------
                                                                                        Thousands of Pesetas
                                                             ----------------------------------------------------------------------
                                                                               Long term                            Short term
                                                             ----------------------------------------------------------------------
                                                              Temporary                                     Temporary
                                                             receivership        Other         Total       receivership      Other
              ---------------------------------------------------------------------------------------------------------------------
              <S>                                            <C>               <C>            <C>            <C>          <C>

              Diputacion General de Aragon
              -  Gambling tax                                     357,728        295,427        653,153         32,418       37,955

              City Council of Alfajarin:
              -  Tax on business activities, property tax          29,254              -         29,254          3,250       80,457

              Central tax authorities:
              -  Personal income tax                                    -         70,900         70,900              -       20,289
              -  Value added tax

              Social Security authorities                         119,194         81,317        200,511              -       43,132

              Other                                                     -            240            240              -          343
                                                                -------------------------------------------------------------------
                                                                  506,174        447,884        954,058         35,668      182,176
              ---------------------------------------------------------------------------------------------------------------------
</TABLE>

                                      F-35


<PAGE>


                        TRANS WORLD GAMING CORP. AND SUBSIDIARIES

         On April 17, 1998, the Company signed a composition with creditors
         (Diputacion General de Aragon, the Social Security authorities and
         the City Council of Alfajarin) which set the terms of payment for the
         Casino's debts as of January 25, 1997, which is the date of the
         Company's application for temporary receivership (see Note 14).

         In 1998 and 1999 Diputacion General de Aragon granted the Company a
         deferral of Ptas. 295.4 million (US$ 1.784 million) in taxes on game
         winnings accruing during 1997, 1998 and 1999. These taxes will begin
         to fall due between 2001 and 2006.

         Likewise, in April 1999 the Casino reached an agreement with the
         Social Security authorities to defer payment of debts affected by the
         temporary receivership and the debts generated in 1997 and in the
         first quarter of 1998, with a combined total of Ptas. 200.5 million
         (US$ 1.211 million), maturing between 2002 and 2009.

         Corporate income tax is calculated on the basis of book income, which
         is determined in accordance with generally accepted accounting
         principles. Such income need not be equal to the income for tax
         purposes, i.e. the corporate income tax base.

         The reconciliation of 1999 results per books to the corporate income
         tax base is as follows:

<TABLE>
<CAPTION>

              -----------------------------------------------------------------------------
                                                                  U.S.          Thousands
                                                                Dollars         of Pesetas
              -----------------------------------------------------------------------------
              <S>                                              <C>              <C>

              Results per books (loss) (after tax)             (1,859,955)        (290,538)
              Permanent differences                                 6,683            1,107
              -------------------------------------------      ----------       ----------
              TAX BASE                                         (1,853,272)        (289,431)
              -------------------------------------------      ----------       ----------

</TABLE>

         The tax loss carryforwards and maximum terms (under Spanish tax
         legislation) allowed for offset are as follows:

<TABLE>
<CAPTION>

              -----------------------------------------------------------------------------
                                         U.S.        Thousands     Last year for
                      Year             Dollars      of Pesetas        offset
              -----------------------------------------------------------------------------
              <S>                     <C>           <C>            <C>

                      1992              360,899        56,375           2002
                      1993              305,883        47,781           2003
                      1994            1,534,579       239,712           2004
                      1995            1,726,504       269,692           2005
                      1996            1,060,068       165,590           2006
                      1997            3,162,137       493,948           2007
                      1998            2,488,781       388,765           2008
                      1999            2,008,815       313,791           2009
              -----------------------------------------------------------------------------
                                     12,647,666     1,975,654
                                     ----------     ---------
</TABLE>

         Under current legislation, losses incurred in a given year can be
         offset against taxable income in the following ten years. However,
         the ultimate amount to carry forward may depend on the outcome of a
         tax inspection of the years in which losses were incurred. The
         accompanying balance sheet does not reflect the possible impact of
         offsetting such tax losses.

         The last four years are open for review of all applicable taxes by
         the tax authorities.

(9)      COMMITMENTS AND CONTINGENCIES

         The main legal disputes in which the Casino is involved are set out
         below:

                                      F-36

<PAGE>

                    TRANS WORLD GAMING CORP. AND SUBSIDIARIES


-    Complaint filed on March 9, 1998 by the Casino against HERALDO DE ARAGON
     (a newspaper) in Court of First Instance no. 11 of Zaragoza, for
     infringement and violation of the right to honor, claiming Ptas. 1,456
     million (US$ 8.79 million) in damages. The case is currently at the
     discovery stage. No amounts have been recorded in respect of this gain
     contingency.

-    An appeal for reversal filed by the Casino against the Superior Court of
     Justice of Aragon in November 1998 against a judgment handed down by Labor
     Court no. 1 of Zaragoza in October 1998 sentencing the Casino to
     compensate an ex-employee. In 1998 the Casino booked Ptas. 10.4 million
     (US$ 0.06 million) for the compensation in question in case it is finally
     sentenced to pay the ex-employee. On November 8, 1999, the Supreme Court
     discharged Casino de Zaragoza, S.A. from its payment obligations relating
     to back pays amounting to Ptas. 4.2 million (US$ 0.03 million).

-    The Group's parent company has yet to sign the collective agreement with
     the workers for the years 1994 through 1999, inclusive, and this matter
     must be arranged with the Works' Committee. In addition, the last
     collective agreement signed by the Company provided for the payment of
     retirement bonuses to employees who retire before age 65.

     The balance sheet as of December 31, 1999 does not include any provision
     for the liabilities that could result from pay raises, the aforementioned
     retirement bonus or any other item that could come to light once the
     collective agreements have been settled.

-    As a result of the different interpretations to which ruling tax
     legislation lends itself and the Company's tax treatment of certain
     transactions, tax contingencies that cannot be objectively quantified
     could arise in respect of the years still open to inspection.

-    Net worth as per the accompanying balance sheet as of December 31, 1999 is
     negative by Ptas. 1,063 million (US$ 6.3 million). This situation
     constitutes a cause for compulsory dissolution unless capital is increased
     or decreased accordingly, pursuant to the Revised Spanish Corporations
     Law, and it raises substantial doubt about its ability to continue as a
     going concern.

     In addition, as indicated in Note 14, in the first few months of 1998 the
     Company signed a composition with creditors in connection with the
     application for temporary receivership that Casino de Zaragoza, S.A. filed
     in January 1997. Note 13 indicates the sums and terms agreed for the
     partial acquittance and deferral with the Company's creditors. In April
     1998, the majority of the Company's capital stock was acquired by a new
     shareholder who plans to undertake a process of recapitalization and to
     relocate the Company's premises in order to boost the Company's operations
     and increase earnings. On February 1, 2000, in accordance with the terms
     of the letter of intent signed as of that date between the Aragon
     Provincial Council and the new shareholder, the Aragon Provincial Council
     passed the Gaming Bill, which will enable the Company to relocate its
     premises to the center of the city of Zaragoza. The aforesaid Bill is
     currently at the stage of being considered at the Aragon Parliament.

     The accompanying financial statements as of December 31, 1999 were
     prepared on a going concern basis, although, considering the above
     circumstances, the Company's ability to continue as a going concern is
     dependent on the success of its future operations and on the continued
     support of its shareholders so as to enable it to realize its assets and
     settle its liabilities for the amounts and according to the
     classification in the financial statements referred to above, which have
     been prepared assuming that the Company will continue as a going concern.
     The financial statements do not include any adjustments that might result
     from the outcome of this uncertainty.

                                     F-37

<PAGE>

                    TRANS WORLD GAMING CORP. AND SUBSIDIARIES

(10) MINORITY INTERESTS

     This caption reflects the value of minority shareholdings in fully
     consolidated companies. Furthermore, the balance in the accompanying
     statement of consolidated income represents the minority shareholders'
     equity in results.

     The entire balance of this caption of the balance sheet relates to
     minority shareholdings in the equity of Los Albares, S.A.

(11) CAPITAL STOCK

     As of December 31, 1999 the Company's capital stock consisted of 2,500
     fully subscribed and paid registered shares of Ptas. 100,000 (US$ 604) par
     value each.

     On November 18, 1999 the resolutions adopted by the Company's Annual and
     Special Shareholders' Meeting held on July 21, 1998 were recorded in a
     public deed. At that meeting, it was agreed that the Company's capital
     stock be reduced from Ptas. 250 million (US$ 1.760 million) to zero in
     order to offset losses through the redemption of the 2,500 registered
     shares representing the Company's capital for Ptas. 250 million by means
     of cash contributions and to increase it by Ptas. 250 million (US$ 1.509
     million) by issuing 2,500 new registered shares of Ptas. 100,000 (US$ 604)
     each.

     In addition and as of the same date, the Company offset losses against
     reserves of an amount totaling Ptas. 580.8 million (US$ 3.5 million).

     The list of all shareholders by ownership percentage as of December 31,
     1999 was as follows:


<TABLE>


                  --------------------------------------------
                  <S>                                  <C>
                  Trans World Gaming Corp.             99.92%
                  Andrew Tottenham                      0.04%
                  Jaime Vaca de Arrazola                0.04%
                  --------------------------------------------


</TABLE>

(12) EXTRAORDINARY ITEMS

     The composition of Extraordinary items as of December 31, 1999 is as
     follows:

<TABLE>
<CAPTION>


         --------------------------------------------------------------------------
                                                            U.S.        Thousands
                                                          Dollars       of Pesetas
         --------------------------------------------------------------------------
         <S>                                               <C>            <C>
         Parent company charges for expenses               458,539        71,627
         Other                                              57,712         9,015
                                                           -------        ------
                                                           516,251        80,642
         --------------------------------------------------------------------------

</TABLE>


(13) SEGMENT DISCLOSURES

     SFAS 131 requires disclosures of segment information provided that it is
     used internally for evaluating segment performance and deciding how to
     allocate resources to segments.

     A breakdown of net sales for ordinary Group operations, by activity, is
     provided below:

                                     F-38

<PAGE>

                    TRANS WORLD GAMING CORP. AND SUBSIDIARIES

<TABLE>
<CAPTION>


                  -----------------------------------------------------------
                                                      U.S.        Thousands
                                                    Dollars       of Pesetas
                  -----------------------------------------------------------
                  <S>                               <C>             <C>
                  Games                             3,579,475       559,139
                  Rooms                               164,532        25,701
                  Restaurant                           56,675         8,853
                  Beverages                            73,953        11,552
                  Other                                 2,170           339
                  -----------------------------------------------------------
                                                    3,876,806       603,584
                  -----------------------------------------------------------

</TABLE>

     All of the Group's activities are carried out within Spain. As of December
     31, 1999, no customer represents more than 10% of net sales.


(14) TEMPORARY RECEIVERSHIP

     On January 25, 1997, the directors of the Company filed an application in
     Court of First Instance number 11 of Zaragoza to declare Casino de
     Zaragoza, S.A. in temporary receivership, which was granted on June 23,
     1997.

     On April 17, 1998, the secondary creditors listed as such in the list of
     creditors approved by the court and the preferred creditors who attended
     the Meeting of Creditors voted for the proposed composition, in which
     Casino de Zaragoza, S.A. agreed to make the following payments:


<TABLE>
<CAPTION>


         -----------------------------------------------------------------------------
                                                              Thousands
                                                              of Pesetas   US Dollars
         -----------------------------------------------------------------------------
         <S>                                                    <C>        <C>
         Social Security authorities (Note 8)                   119,194      719,684

         Partial acquittance of 35.75% of the credits of
          the rest of the creditors of the composition          206,529    1,247,005

         Repayment schedule for the remaining 64.25%
          of the credits of the rest of the creditors
          of the composition:
           Year 1                                                     -            -
           Year 2                                                39,518      238,606
           Year 3                                                36,840      222,437
           Year 4                                                36,840      222,437
           Year 5                                                36,840      222,437
           Year 6                                               110,520      667,311
           Year 7                                               110,520      667,311
         -----------------------------------------------------------------------------
         TOTAL CREDIT OF THE CREDITORS WHO SIGNED THE
          COMPOSITION                                           696,801    4,207,228
         -----------------------------------------------------------------------------

</TABLE>

     If the Casino does not make its payments according to the schedule, the
     debt would go back to pre-composition levels.

     In addition, there are Ptas 102.7 million (US$ 0.62 million) due to other
     privileged creditors that are subject to the same payment and acquittance
     conditions conditions as described for the rest of the creditors in the
     composition.

                                     F-39

<PAGE>

                    TRANS WORLD GAMING CORP. AND SUBSIDIARIES




                    CASINO DE ZARAGOZA, S.A. AND SUBSIDIARIES
                        STATEMENT OF SHAREHOLDERS' EQUITY
                             AS OF DECEMBER 31, 1999

<TABLE>
<CAPTION>


--------------------------------------------------------------------------------------------------------------------------------
                                                                                   US Dollars
                                                --------------------------------------------------------------------------------
                                                                                                  Accumulated
                                                 Subscribed                                         Other
                                                   Capital        Accumulated       Income       Comprehensive    Comprehensive
                                                    Stock           Losses       for the year        Income          Income
--------------------------------------------------------------------------------------------------------------------------------
<S>                                               <C>             <C>            <C>              <C>              <C>
OPENING BALANCE AS OF DECEMBER 31, 1998           1,760,935       (9,413,115)       564,831          23,075                -
Transfer to accumulated losses                            -          564,831       (564,831)              -                -
Capital reduction charged against reserves       (1,760,935)       1,760,935              -               -                -
Capital increase                                  1,509,479                -              -               -                -
Translation adjustment                                    -                -              -       1,114,466        1,114,466
Income (loss) for the year                                -                -     (1,859,955)              -       (1,859,955)
Other                                                     -                -              -          29,839           29,839
--------------------------------------------------------------------------------------------------------------------------------
CLOSING BALANCE AS OF DECEMBER 31,  1999          1,509,479       (7,087,349)    (1,859,955)      1,167,380         (715,650)
--------------------------------------------------------------------------------------------------------------------------------


</TABLE>

<TABLE>
<CAPTION>


         -----------------------------------------------------------------------------------------
                                                                    Thousands of Pesetas
                                                       -------------------------------------------
                                                        Subscribed                        Income
                                                          Capital       Accumulated       for the
                                                           Stock          Losses           Year
         -----------------------------------------------------------------------------------------
         <S>                                              <C>          <C>              <C>
         OPENING BALANCE AS OF DECEMBER 31, 1998           250,000     (1,336,380)        83,465
         -----------------------------------------------------------------------------------------
         Transfer to accumulated losses                         --         83,465        (83,465)
         Capital reduction charged against reserves       (250,000)       250,000             --
         Capital increase                                  250,000             --             --
         Income (loss) for the year                             --             --       (290,538)
         Other                                                  --          4,942             --
         -----------------------------------------------------------------------------------------
         CLOSING BALANCE AS OF DECEMBER 31,  1999          250,000       (997,973)      (290,538)
         -----------------------------------------------------------------------------------------


</TABLE>


                                     F-40