UNITED STATES
                        SECURITIES AND EXCHANGE COMMISSION

                               Washington, D.C. 20549

                                    FORM 10-Q/A

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


                 For the Quarterly Period Ended June 30, 1999

                                        OR

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

For the Transition Period from                to

Commission File Number                  0-13084

                               WARRANTECH CORPORATION
               (Exact name of registrant as specified in its charter)

                  Delaware                           13-3178732
     (State or other jurisdiction of              (I.R.S. Employer
      incorporation or organization)              Identification No.)

      300 Atlantic Street, Stamford, CT                 06901
  (Address of principal executive offices)            (Zip Code)

Registrant's telephone number, including area code   (203) 975-1100


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

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

             Class                          Outstanding at January 10, 2000
Common stock, par value $.007 per share            15,176,986 shares



                                        1

<PAGE>


                     WARRANTECH CORPORATION AND SUBSIDIARIES


                                    I N D E X

<TABLE>
<S>                                                                                                    <C>
                                                                                                       Page No.
PART I  -  Financial Information:


              Item 1.  Financial Statements

                Condensed Consolidated Balance Sheets at June 30, 1999
                (Unaudited) and March 31, 1999...................................................            3


                Condensed Consolidated Statements of Operations
                   For the Three Months Ended June 30, 1999
                   and 1998 (Unaudited) .........................................................            4

                 Condensed Consolidated Statements of Cash Flows
                   For the Three Months Ended June 30, 1999
                   and 1998 (Unaudited)..........................................................            5


                 Notes to Condensed Consolidated Financial Statements                                        6

                  Item 2.  Management's Discussion and Analysis of
                           Financial Condition and Results of Operations                                     9


PART II  - Other Information.....................................................................           11


Signatures ......................................................................................           12


</TABLE>



                                        2

<PAGE>

                     WARRANTECH CORPORATION AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS

                                   A S S E T S
                                   (Unaudited)

<TABLE>
<S>                                                                                  <C>               <C>
                                                                                          June 30,       March 31,
                                                                                            1999           1999
                                                                                      ---------------- -------------
Current assets:
Cash and cash equivalents                                                                 $17,977,327   $15,032,473

Investments in marketable securities                                                        3,947,482     2,961,602


Accounts receivable (net of allowances of
 $1,103,068 and $1,115,285, respectively)                                                  29,711,388    39,275,404
Other receivables, net                                                                      8,395,263     5,924,332
Income tax receivable                                                                       1,271,518     1,147,324
Deferred income taxes                                                                       1,465,375     1,419,854
Prepaid expenses and other current assets                                                   1,493,020     1,537,633
                                                                                      ---------------- -------------
   Total current assets                                                                    64,261,373    67,298,622
                                                                                      ---------------- -------------




Property and equipment, net                                                                16,024,620    16,277,473

Other assets:
Excess of cost over fair value of assets acquired
(net of accumulated amortization of $5,049,222
and  $4,882,009, respectively)                                                              3,109,311     3,276,524
Deferred income taxes                                                                      10,766,000     9,603,277
Deferred direct costs                                                                      89,787,563    86,107,696
Investments in marketable securities                                                        1,384,389     1,321,019
Restricted cash                                                                               800,000       800,000
Split dollar life insurance policies                                                        1,450,010     1,370,010
Notes receivable                                                                              435,008       477,767
Collateral security fund                                                                      199,389       199,389
Other assets                                                                                  178,493       178,493
                                                                                      ---------------- -------------
          Total other assets                                                              108,110,163   103,334,175
                                                                                      ---------------- -------------


                    Total assets                                                         $188,396,156   $186,910,270
                                                                                      ================ =============

                                       LIABILITIES AND STOCKHOLDERS' EQUITY
                                                                                         (Unaudited)
                                                                                          June 30,       March 31,
                                                                                            1999           1999
                                                                                      ---------------- -------------
Current liabilities:
Current maturities of long-term debt and capital lease obligations                         $1,575,886    $1,558,447
Insurance premiums payable                                                                 36,774,102    36,585,920
Accounts and commissions payable                                                            7,754,639     8,524,040
Legal settlements payable                                                                     100,000       100,000
Accrued expenses and other current liabilities                                              8,089,458     8,346,440
                                                                                      ---------------- -------------
   Total current liabilities                                                               54,294,085    55,114,847
                                                                                      ---------------- -------------



Deferred revenues                                                                         124,532,747   118,497,564

Long-term debt and capital lease obligations                                                2,325,359     2,420,967

Deferred rent payable                                                                         466,611       476,890
                                                                                      ---------------- -------------
   Total liabilities                                                                      181,618,802   176,510,268
                                                                                      ---------------- -------------

Commitments and contingencies

Stockholders' equity:
  Preferred stock - $.0007 par value authorized - 15,000,000
     issued  - none at June 30, 1999 and March 31, 1999
   Common stock - $.007 par value: authorized - 30,000,000
     Shares issued;  - 16,503,161  shares at June 30, 1999
     and 16,501,786 shares at March 31, 1999                                                  115,522       115,513
   Additional paid-in capital                                                              23,733,298    23,728,881
   Loans to directors and officers                                                        (9,150,076)   (9,006,699)
   Accumulated  other comprehensive income, net of taxes                                    (144,967)      (93,534)
   Retained earnings                                                                      (3,327,110)       105,154
                                                                                      ---------------- -------------
                                                                                           11,226,667    14,849,315
Treasury stock - at cost, 1,280,300 shares at June 30,1999
   and March 31, 1999                                                                     (4,449,313)   (4,449,313)
                                                                                      ---------------- -------------
        Total Stockholders' Equity                                                          6,777,354    10,400,002
                                                                                      ---------------- -------------

        Total Liabilities and Stockholders' Equity                                       $188,396,156   $186,910,270
                                                                                      ================ =============
</TABLE>

See accompanying notes to condensed consolidated financial statements.


                                        3

<PAGE>



                     WARRANTECH CORPORATION AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)

<TABLE>
<S>                                                                                <C>              <C>
                                                                                      For the Three Months Ended
                                                                                                June 30,
                                                                                         1999             1998
                                                                                   ---------------- ----------------
Gross revenues                                                                         $29,279,883      $30,876,772
Net increase in deferred revenues                                                      (6,025,930)      (6,742,626)
                                                                                   ---------------- ----------------
Net revenues                                                                            23,253,953       24,134,146

Costs and expenses:
   Direct costs                                                                         13,789,628       12,626,122
   Service, selling, and general and administrative                                     12,999,952       14,176,847
   Depreciation and amortization                                                         1,413,347        1,274,614
                                                                                   ---------------- ----------------
Total costs and expenses                                                                28,202,927       28,077,583

                                                                                   ---------------- ----------------
(Loss) from operations                                                                 (4,948,974)      (3,943,437)

Other income                                                                               253,095          169,960
                                                                                   ---------------- ----------------

(Loss) before provision for income taxes                                               (4,695,879)      (3,773,477)
Provision (benefit) for income taxes                                                   (1,263,615)      (1,983,437)
                                                                                   ---------------- ----------------

Net (loss)                                                                            ($3,432,264)     ($1,790,040)
                                                                                   ================ ================

Earnings per share:
Basic                                                                                      ($0.23)          ($0.13)
                                                                                   ================ ================
Diluted                                                                                    ($0.23)          ($0.13)
                                                                                   ================ ================

Weighted average number of shares outstanding:
Basic                                                                                   15,222,861       13,362,303
                                                                                   ================ ================
Diluted                                                                                 15,222,861       13,362,303
                                                                                   ================ ================
</TABLE>

See accompanying notes to condensed consolidated financial statements.


                                        4

<PAGE>


                     WARRANTECH CORPORATION AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)

<TABLE>
<S>                                                                         <C>                 <C>
                                                                                   For the Three Months Ended
                                                                                             June 30,
                                                                                    1999                1998
                                                                             ------------------ --------------------

Net cash flows from (used in ) operating activities                                 $5,033,186         ($2,904,060)
                                                                             ------------------ --------------------
Cash flows from investing activities:
   Property and equipment purchased                                                  (635,602)          (1,065,906)
   Purchase of marketable securities                                               (1,300,000)            (205,420)
   Proceeds from sales of marketable securities                                        235,000              540,045

                                                                             ------------------ --------------------
Net cash (used in) investing activities                                            (1,700,602)            (731,281)
                                                                             ------------------ --------------------
Cash flows from financing activities:
    Decrease in notes receivable                                                        42,759               22,611
    Exercise of common stock options and stock grants                                    4,426              205,343
    Purchase treasury stock                                                          -                    (327,641)
    Repayments, notes and capital leases                                             (434,915)            (846,149)

                                                                             ------------------ --------------------
Net cash (used in) financing activities                                              (387,730)            (945,836)
                                                                             ------------------ --------------------

Net increase (decrease) in cash and cash equivalents                                 2,944,854          (4,581,177)

Cash and cash equivalents at beginning of period                                    15,032,473           24,062,052
                                                                             ------------------ --------------------
Cash and cash equivalents at end of period                                         $17,977,327          $19,480,875
                                                                             ================== ====================


Supplemental Cash Flow Information:
Cash payments for:
   Interest                                                                           $105,534             $135,574
                                                                             ================== ====================
   Income taxes                                                                        $43,324             $903,668
                                                                             ================== ====================

Non-Cash Investing and financing activities:
   Property and equipment financed through capital leases                             $356,746             $156,293
    Increase in loans to officers and directors                                      (143,377)            -


</TABLE>

See accompanying notes to condensed consolidated financial statements.


                                   5

<PAGE>

                     WARRANTECH CORPORATION AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

                                  June 30, 1999
                                   (Unaudited)

1.  THE COMPANY

Warrantech,  through its wholly  owned  subsidiaries,  markets  and  administers
service  contracts  and  extended  warranties.  The  Company  is a  third  party
administrator for a variety of dealer/clients in selected  industries and offers
call center and technical computer services.  The Company assists dealer/clients
in  obtaining  insurance  policies  from  highly  rated  independent   insurance
companies for all contracts and programs offered.  The insurance company is then
responsible  for  the  cost  of  repairs  or  replacements   for  the  contracts
administered by Warrantech.

The Company operates under three major business segments:  Automotive,  Consumer
Products and  International.  The  Automotive  segment  markets and  administers
extended  warranties on  automobiles,  light trucks,  recreational  vehicles and
automotive  components.  These  products are sold  principally by franchised and
independent  automobile dealers,  leasing companies,  repair facilities,  retail
stores and financial  institutions.  The Consumer  Products  segment markets and
administers extended warranties on household appliances,  electronics and homes.
These  products  include home  appliances,  consumer  electronics,  televisions,
computers,  home office equipment and homes. These products are sold principally
by  retailers,  distributors,  manufacturers,  utility  companies  and financial
institutions.  Warrantech  also direct  markets  these  products to the ultimate
consumer  through  telemarketing  and direct mail campaigns.  The  International
segment markets and administers outside the United States predominately the same
products and services of the other business segments.  The International segment
is currently operating in the United Kingdom,  Central and South America, Puerto
Rico and the Caribbean.

The predominant  terms of the service  contracts and extended  warranties  range
from twelve (12) to eighty-four  (84) months.  The Company acts as a third party
administrator  on behalf of the  dealer/clients  and  insurance  companies.  The
actual repairs and replacements  required under the service contract  agreements
are performed by independent third party authorized repair facilities.  The cost
of these  repairs is borne by the  insurance  companies  which have the ultimate
responsibility   for  the  claims.   The  insurance   policy   indemnifies   the
dealer/clients  against  losses  resulting  from  service  contract  claims  and
protects the consumer by ensuring their claims will be paid.

The Company's service contract  programs benefit consumers with expanded and/or
extended  product coverage for a specified period of time (and/or mileage in the
case of  automobiles  and  recreational  vehicles),  similar to that provided by
manufacturers  under  the  terms  of their  product  warranties.  Such  coverage
generally provides for the repair or replacement of the product,  or a component
thereof,  in the event of its failure.  The Company's  service contract programs
benefit the dealer/clients by providing enhanced value to the goods and services
they offer. It also provides the  opportunity  for increased  revenue and income
while  outsourcing  the costs and  responsibilities  of  operating  an  extended
warranty program.

2.  BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial  information and with the  instructions to Form 10-Q and Article 10 of
Regulation S-X.  Accordingly,  they do not include all information and footnotes
required by generally  accepted  accounting  principles  for complete  financial
statements. In the opinion of management,  all adjustments (consisting of normal
recurring  accruals)  considered  necessary  for a fair  presentation  have been
included.  Operating  results for the three  months  ended June 30, 1999 are not
necessarily  indicative  of the results that may be expected for the year ending
March 31, 2000. For further  information,  refer to the  consolidated  financial
statements  and footnotes  thereto  included in the Company's Form 10K/A for the
year ended March 31, 1999.

Certain prior year amounts may have been reclassified to conform to current year
presentation.

                                        6

<PAGE>

Revenue  Recognition  Policy  - The  Company's  revenue  recognition  policy  is
segregated into two distinct categories  depending on whether the Company or the
retailer/dealer  is designated as the obligor on the service  contract  sale. In
either case, a highly rated  independent  insurance  company  assumes all claims
liabilities of the service contracts administered by the Company.

Dealer  obligor  service  contracts  are sales in which the  retailer/dealer  is
designated  as  the  obligor.  For  these  service  contract  sales,  using  the
proportional  performance  method,  the  Company  recognizes  revenues in direct
proportion to the costs incurred in providing the service  contract  programs to
the  Company's   clients.   Revenues  in  amounts   sufficient  to  meet  future
administrative  costs and a reasonable gross profit thereon are deferred.  Sales
of dealer  obligor  service  contracts  are  reflected in gross  revenues net of
premiums  paid to  insurance  companies  as well as  related  sales  commissions
associated with the contracts.

Administrator  obligor  service  contracts  are  sales  in which  Warrantech  is
designated  as the  obligor.  For these  service  contract  sales,  the  Company
recognizes  revenues in accordance  with Financial  Accounting  Standards  Board
Technical  Bulletin 90-1 ("TB 90-1"),  Accounting for Separately Priced Extended
Warranty  and  Product  Maintenance   Contracts,   and  Statement  of  Financial
Accounting  Standards No. 60 ("SFAS 60"),  Accounting and Reporting by Insurance
Enterprises.  These accounting standards require the recognition of revenue over
the  life  of  the  contract  on  a  straight-line   basis,  unless  sufficient,
company-specific,  historical  evidence  indicates  that the costs of performing
services under these contracts are incurred on other than a straight-line basis.
The Company is recognizing revenue on administrative  obligor contracts based on
company specific historical claims experience over the life of the contract.

COMPREHENSIVE INCOME

The components of comprehensive income are as follows:

<TABLE>
<S>                                                         <C>               <C>
                                                                 For the Three Months Ended

                                                                          June 30,
                                                            ------------------------------------
                                                                  1999               1998
                                                            ------------------------------------
              Net (loss)                                        ($3,432,264)       ($1,790,040)
              Other Comprehensive Income, net of tax:
                 Foreign currency translation adjustments           (42,502)           (20,361)
                 Unrealized gain(loss) on investments                (8,931)            (1,133)
                                                            -----------------  -----------------
              Comprehensive Income/(loss)                       ($3,483,697)       ($1,811,534)
                                                            =================  =================

              The components of accumulated other comprehensive income, net of related tax are as follows:


                                                                June 30,           March 31,
                                                                  1999               1999
                                                            -----------------  -----------------
              Accumulated translation adjustments                 ($143,488)         ($100,986)
              Unrealized gain/(loss) on investments                  (1,479)              7,452
                                                            -----------------  -----------------
              Accumulated other comprehensive income/(loss)       ($144,967)          ($93,534)
                                                            =================  =================

</TABLE>

                                             7

<PAGE>

4.   EARNINGS PER SHARE

  The computation of earnings per share was as follows:


<TABLE>
<S>                                                              <C>                 <C>
                                                                      For the Three Months Ended
                                                                               June 30,
                                                                       1999                1998
                                                                 -----------------   ----------------
              Numerator:
                 Net (loss) applicable to common stock               ($3,432,264)       ($1,790,040)
                                                                 =================   ================
              Denominator:
                  Average outstanding shares used in the
                  computation of per share earnings:
                    Common Stock issued-Basic shares                   15,222,861         13,362,303
                    Stock Options (treasury method)                      -                  -
                                                                 -----------------   ----------------
                    Diluted shares                                     15,222,861         13,362,303
                                                                 =================   ================
              Earnings Per Common Share:
                 Basic                                                    ($0.23)            ($0.13)
                                                                 =================   ================
                 Diluted                                                  ($0.23)            ($0.13)
                                                                 =================   ================
</TABLE>

In a net loss position options are anti-dilutive.

5.   SEGMENTS

The Company  defines its operations  into three business  segments:  Automotive,
Consumer  Products and  International  operations.  All Other  includes  general
corporate  income  and  expenses,  inter-segment  sales and  expenses  and other
corporate assets not related to the three business segments.


<TABLE>
<S>                              <C>            <C>          <C>              <C>            <C>          <C>
                                                  Consumer                    Reportable
Three Months Ended                Automotive      Products    International    Segments       All Other       Total
June 30, 1999
Revenues                           $11,655,790   $15,166,654     $3,061,141    $29,883,585     ($603,702)   $29,279,883
Pretax Income (Loss)                   369,596   (4,488,606)      (921,538)    (5,040,548)        344,669   (4,695,879)
Net Interest Income                      7,970           511        (1,291)          7,190        210,660       217,850
Depreciation/Amortization              181,917       353,594        216,074        751,585        661,762     1,413,347

June 30, 1998
Revenues                           $12,760,550   $16,632,828     $3,192,393    $32,585,771   ($1,708,999)   $30,876,772
Pretax Income (Loss)                 (134,913)   (3,430,809)      (160,089)    (3,725,811)       (47,666)   (3,773,477)
Net Interest Income                     14,229        30,918          7,477         52,624        100,956       153,580
Depreciation/Amortization              180,967       385,809        114,844        681,620        592,994     1,274,614

</TABLE>

6.  SIGNIFICANT CUSTOMERS

The  Company  had  one  significant  customer,   CompUSA,  which  accounted  for
approximately 34%, 34% and 32%, respectively, of consolidated gross revenues for
the years ended March 31, 1999, 1998 and 1997. The Company  notified  CompUSA in
May 1999 of price increases  resulting from premium  increases  imposed by CIGNA
Insurance Company. On June 28, 1999,  Warrantech received formal notification of
termination  from CompUSA  effective  July 28, 1999. The loss of CompUSA had and
will have a significant impact on current and future revenues.

                                   8

<PAGE>

                     WARRANTECH CORPORATION AND SUBSIDIARIES

ITEM 2. Management's  Discussion and Analysis of Financial Condition and Results
of Operations

Except for the historical  information  contained herein,  the matters discussed
below or elsewhere in this quarterly report are forward looking  statements that
involve  risks  and  uncertainties.  The  Company  makes  such  forward  looking
statements  under the  provisions  of the "safe  harbor"  section of the Private
Securities  Litigation Reform Act of 1995.  Forward looking statements are based
on  management's  beliefs  and  assumptions,  as well as  information  currently
available to management.  Such beliefs and assumptions are based on, among other
things, the Company's operating and financial  performance over recent years and
its  expectations  about its business for the current fiscal year.  Although the
Company  believes  that  the  expectations  reflected  in such  forward  looking
statements are reasonable,  it can give no assurance that such expectations will
prove to be correct. Such statements are subject to certain risks, uncertainties
and assumptions,  including (a) prevailing economic conditions may significantly
deteriorate,  thereby  reducing  the  demand  for  the  Company's  products  and
services,  (b) unavailability of technical support personnel or increases in the
rate of  turnover  of such  personnel,  reflecting  increased  demand  for  such
qualified  personnel,  (c)  changes in the terms or  availability  of  insurance
coverage for the Company's programs or (d) regulatory or legal changes affecting
the  Company's  business,  although none of these risks are  anticipated  at the
present  time.  Should one or more of these or any other risks or  uncertainties
materialize,  or should  the  underlying  assumptions  prove  incorrect,  actual
results may vary materially from those anticipated, estimated or expected.


Results of Operations

Gross  revenues  for the three months  ended June 30, 1999 were  $29,279,883,  a
decrease of $1,596,889 as compared with  $30,876,772  for the three months ended
June 30, 1998. This decrease is directly  attributable  to decreased  revenue in
the  Automotive  and Consumer  Products  business  segments.  In the  Automotive
segment,  the decrease in revenue was primarily the result of a sales mix change
created by an increase in dealer  obligor  business.  In the  Consumer  Products
segment,  the  decrease in revenue  occurred  from  decreased  sales in computer
related  extended  warranties  as a result of the  termination  of the Company's
relationship  with its most  significant  customer,  CompUSA.  This decrease was
partially  offset by an increase in sales of home  warranty  service  contracts.
During the fiscal year March 31, 1999,  CompUSA  accounted for approximately 34%
of consolidated gross revenues.

The net  increase in deferred  revenues for the three months ended June 30, 1999
was  $6,025,930 as compared to a net increase of $6,742,626  for the same period
last year.  These  increases are directly  attributable  to the sales of service
contracts  in the  current  period with a service  duration  over one year being
greater than the amortization of revenues from previous periods being recognized
in the current year.  The year to year change is also the result of the increase
in deferred  revenue for dealer  obligor  service  contracts  necessary  to meet
future  administrative costs to service these contracts.  Lastly, the net change
in  deferred  revenue  is  significantly  impacted  by  the  decreased  revenues
resulting from the termination of the Company's agreement with CompUSA.

Direct costs, which consist primarily of insurance premiums and commissions, are
those  costs  directly  related to the  production  and  acquisition  of service
contracts where  Warrantech is named as the obligor.  Direct costs for the three
months ended June 30, 1999 were $13,789,628 as compared with $12,626,122 for the
comparable  period last year.  The  increase in direct costs are  primarily  the
result of prior period  amortization costs being greater than the current period
costs being deferred to future periods offset by the reduced revenues due to the
termination of the Company's administrative agreement with CompUSA.

Service,  selling and general and  administrative  expenses (SG&A) for the three
months ended June 30, 1999 were $12,999,952 as compared with $14,176,847 for the
same period last year.  The decrease in SG&A  expenses  reflects  the  Company's
operational  efficiency  initiatives which include the reengineering of its call
center  process  and  consolidation  of  certain  operating  and  administrative
functions.  These  initiatives  resulted in lower  payroll  and payroll  related
expenses which were offset slightly by higher telephone costs.


                                   9

<PAGE>

Depreciation and amortization was $1,413,347 for the three months ended June 30,
1999 compared to $1,274,614  for the same period last year. The increase was due
primarily to capital  additions  related to the Company's ongoing upgrade of its
computer systems.

The provision (benefit) for income taxes is based on the Company's projection of
its estimated effective tax rate for the fiscal year.

Net loss for the three  months ended June 30, 1999 was  $3,432,264  or $0.23 per
diluted  share  compared to a net loss of  $1,790,040 or $0.13 per diluted share
for  the  comparable  period  last  year.  This  change  is  the  result  of the
termination of the Company's  relationship  with its most  significant  customer
during the period and the other factors listed above.


Liquidity and Financial Resources

The Company has ongoing  relationships  with equipment  financing  companies and
intends to continue  financing  certain future  equipment  needs through leasing
transactions.  The total amount financed through leasing transactions during the
three month period ended June 30, 1999 was  $356,746.  In addition,  the Company
had a revolving  credit  agreement  with a bank which  originally  provided  for
maximum  aggregate  borrowings  up to  $10,000,000  with  interest at the bank's
prevailing  prime rate or LIBOR plus 2%.  Subsequent to March 31, 1999, the line
of credit was  adjusted to  $1,500,000  and expired on December  31,  1999.  The
Company is presently in negotiations to replace this line of credit. Although it
is  anticipated  that this will be completed by February 2000, no assurances can
be given this will be accomplished. During the fiscal years ended March 31, 1998
and 1999 the Company did not have any borrowings under this line of credit.

The Company  believes  that  internally  generated  funds will be  sufficient to
finance  its  current  operations  for at least  the next  twelve  months.  Cash
provided  by  operations  during  the  three  months  ended  June  30,  1999 was
$5,033,186,  which is principally  attributable  to a reduction in the amount of
accounts receivable outstanding.

On July 6, 1998,  Joel San Antonio,  Warrantech's  Chairman and Chief  Executive
Officer,  and William Tweed and Jeff J. White, members of the Warrantech's Board
of Directors, exercised 3,000,000 of their vested options to purchase Warrantech
common stock.  Promissory  notes totaling  $8,062,500  were signed with interest
payable over three years at an annual interest rate of 6%. The promissory notes,
which are with  recourse and secured by the stock  certificates  issued,  mature
July 5, 2001. An additional  promissory  note was signed by Joel San Antonio for
$595,634 on March 22, 1999 which  represents  the amounts  funded by the Company
with  respect  to his  payroll  taxes for the  exercise  of these  options.  The
exercise  of these  stock  options and the  anticipated  tax  benefit  from this
transaction total approximately $10 million. These amounts have been recorded as
a  contra-equity  account,  which is a reduction of  stockholders'  equity.  The
Company is  currently in  discussions  with the Messrs.  San Antonio,  Tweed and
White to  renegotiate  the payment terms of the notes.  The payment of interest,
which was due July 6,  1999,  has been  deferred  pending  finalization  of such
discussions.

The  effect of  inflation  has not been  significant  to the  Company  since its
formation.

Year 2000

The Company has addressed the business,  financial,  technical,  legal and other
implications  that related to the various Year 2000 date issues. A comprehensive
Year 2000  program was put into place during  fiscal 1998 and  executed  through
December  31,  1999.  The primary goal of the Year 2000 program was to implement
the changes needed to answer functionality in the Year 2000, as cost effectively
and expeditiously as possible.  As of January 10, 2000, the Company  experienced
no  significant  interruptions  from any  computer  hardware,  software or other
business operations.


                                        10

<PAGE>

PART II. Other Information

Item 1.       Legal Proceedings

              Not applicable

Item 2.       Changes in Securities

              Not applicable.

Item 3.       Defaults Upon Senior Securities

              Not applicable.

Item 4.       Submission of Matters to Vote of Security Holders

              Not applicable.

Item 5.       Other Information

              Not applicable.

Item 6 (a)                 Exhibits

               (27)        Financial Data Schedule

Item 6 (b)                 Reports on 8-K

              Not applicable


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<PAGE>

                                   SIGNATURES


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

                                      WARRANTECH CORPORATION



                                      By:  /s/ Joel San Antonio
                                          ------------------------------------
                                          Joel San Antonio - Chairman of the
                                          Board and Chief Executive Officer
Date:  January 14, 2000



                                       By:  /s/ Richard F. Gavino
                                          ------------------------------------
                                          Richard F. Gavino - Executive Vice
                                          President and Chief Financial Officer

Date:  January 14, 2000




                                        12