U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB
              [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                     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 ________


                                 Bad Toys, Inc.
             (Exact name of registrant as specified in its charter)


    Nevada                            0-29836                       33-0677545
--------------               ------------------------             --------------
  (state of                  (Commission File Number)             (IRS Employer
incorporation)                                                     I.D. Number)


                              2344 Woodridge Avenue
                               Kingsport, TN 37664
                                  423-247-9560
          ------------------------------------------------------------
             (Address and telephone number of registrant's principal
               executive offices and principal place of business)

     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  twelve  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
                                              ---    ---
     As of June 30, 1999, there were 5,793,200 shares of the Registrant's Common
Stock, par value $0.01 per share, outstanding.

     Transitional Small Business Disclosure Format (check one): Yes     No X
                                                                    ---   ---


<PAGE>



                         PART I - FINANCIAL INFORMATION



Item 1.          Financial Statements



                                        2

<PAGE>

                                 Bad Toys, Inc.
                          (A Development Stage Company)
                                 Balance Sheets
                        June 30, 1999 & December 31, 1998

<TABLE>
<CAPTION>
                                                                6/30/99           12/31/98
Assets                                                         Unaudited           Audited
------                                                         ---------          ---------
<S>                                                            <C>                <C>
Cash & Cash Equivalents                                        $   6,314          $   1,757

Accounts Receivable                                                2,044              1,097

Inventory (Note B)                                               258,660            180,160

Prepaid Expenses                                                  22,483             23,543
                                                                 -------            -------

                                  Total Current Assets           289,501            206,557
                                                                 -------            -------

Property, Plant & Equipment,
 net of accumulated depreciation (Note C)                         75,298             70,954

Organization Costs, net of accumulated amortization               24,398             27,146

Syndication Costs                                                      0             14,400

Utility Deposits                                                     280                280
                                                                 -------            -------

                                          Total Assets           389,477            319,337
                                                                 =======            =======
Liabilities & Shareholders' Equity
----------------------------------
Accounts Payable & Accrued Liabilities                           100,396             57,499

Current Portion of Long Term Debt                                  6,472              8,459
                                                                 -------            -------

                             Total Current Liabilities           106,868             65,958
                                                                 -------            -------

Notes Payable - Long Term                                         23,175             26,994

Notes Payable - Shareholders (Note F)                            328,748            216,176
                                                                 -------            -------

                                      Total Liabilities          458,791            309,128

Common Stock, par value $.01; 10,000,000 shares                   57,932             53,550
  authorized, 5,793,200 & 5,355,000
  shares issued and outstanding respectively

Additional Paid In Capital                                       436,150            249,332

Deficit Accumulated During the Development Stage                (563,396)          (292,673)
                                                                 -------            -------

               Total Liabilities & Shareholders' Equity        $ 389,477          $ 319,337
                                                                 =======            =======
</TABLE>


                        See notes to financial statements

                                       3

<PAGE>

                                 Bad Toys, Inc.
                          (A Development Stage Company)
                             Statement of Operations
                                   (Unaudited)
<TABLE>
<CAPTION>

                                     Three Months ended       Six Months ended
                                          June 30                 June 30
                                        1999       1998        1999       1998
                                     ------------------     ------------------
<S>                                <C>        <C>         <C>        <C>
Sales                              $  14,545  $  27,294   $  24,251  $  30,022

Cost of Sales                         23,832     26,717      43,864     29,975
                                                            -------    -------

           Gross Profit               (9,287)       577     (19,613)        47
                                     -------    -------     -------    -------

General & Administrative
 Expenses                            179,356     26,635     234,969     39,642
                                     -------    -------     -------    -------


Income (Loss) from operations
 before interest expense            (188,643)   (26,058)   (254,582)   (39,595)
                                     -------    -------     -------    -------

Interest Expense                       8,719      4,675      16,141      8,217
                                     -------    -------     -------    -------

           Net Earnings (Loss)     $(197,362)   (30,733)  $(270,723)   (47,812)
                                     =======    =======     =======    =======

Net Earnings (Loss)
 Per Share                        $(0.035235) (0.005834) $(0.048568) (0.009076)
                                    --------   --------    --------   --------

Weighted Average Shares            5,601,350  5,268,000   5,574,100  5,268,000
                                   ---------  ---------   ---------  ---------

</TABLE>


















                        See notes to financial statements

                                       4

<PAGE>


                                 Bad Toys, Inc.
                          (A Development Stage Company)
                            Statements of Cash Flows
                            For the Six Months Ended
                          June 30, 1999 & June 30, 1998
<TABLE>
<CAPTION>

                                                                  6/30/99            6/30/98
                                                                  -------            -------
<S>                                                              <C>                <C>
Cash flow from operating activities:
  Cash received from customers                                 $   22,207         $   29,676
  Cash paid to suppliers and employees                           (215,907)          (102,201)
  Other operating disbursements                                  (111,225)           (52,649)
  Depreciation & Amortization                                      11,516             11,516
                                                                  -------            -------

 Net cash provided (used) by operating activities                (293,409)         (113,658)

Cash flows from investing activities:
  Cash payments for the purchase of property                            0                 0
                                                                  -------           -------

 Net cash provided (used) by investing activities                       0                 0
                                                                  -------           -------

Cash flow from financing activities:
  New borrowings
   Proceeds from equipment and other loans                              0            28,827
  Debt reduction:
    Long-Term                                                      (3,819)                0
    Short-Term                                                     (1,987)                0
  Proceeds from additional paid in capital                        186,818            26,460
  Proceeds from shareholder debt                                  112,572            58,756
  Proceeds from issuance of common stock                            4,382               540
                                                                  -------           -------

 Net cash provided (used) by financing activities                 297,966           114,583
                                                                  -------           -------

Net increase (decrease) in cash & equivalents

Cash & Equivalents, beginning of period                             1,757               476
                                                                  -------           -------

Cash & Equivalents, end of period                                   6,314             1,401
                                                                  =======           =======


Supplemental disclosures of cash flow information:

Cash paid during the year for:
  Interest expense                                                 16,141            8,217

</TABLE>







                        See notes to financial statements

                                       5


<PAGE>

                                 Bad Toys, Inc.
                          (A Development Stage Company)
                            Statements of Cash Flows
                            For the Six Months Ended
                          June 30, 1999 & June 30, 1998
<TABLE>
<CAPTION>

                                                                  6/30/99           6/30/98
                                                                  -------           -------
<S>                                                             <C>                 <C>
Reconciliation of net income to net cash
 provided by operating activities

  Net Income/(Loss)                                             $(270,723)          (47,812)
                                                                  -------            -------
  Adjustments  to  reconcile  net  income  to net  cash
  Provided  by  operating activities:
   Depreciation and amortization                                   11,516            11,516
   (Increase) decrease in other assets                              8,904                 0
   (Increase) decrease in accounts receivable                        (947)             (346)
   (Increase) decrease in prepaid expense                           1,060             3,419
   (Increase) decrease in inventories                             (78,500)          (51,148)
   (Increase) decrease in fixed assets                             (7,616)          (40,949)
   Increase (decrease) in accounts payable                         15,081            12,121
   Increase (decrease) in accrued liabilities                      24,514              (894)
   Increase (decrease) in interest payable                          3,302               435
                                                                  -------           -------

   Total adjustments                                              (22,686)          (65,846)
                                                                  -------           -------

  Net cash provided (used) by investing activities               (293,409)         (113,658)

</TABLE>






















                        See notes to financial statements

                                        6
<PAGE>

                                 Bad Toys, Inc.
                          Notes to Financial Statements



NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

This summary of significant  accounting policies of Bad Toys, Inc. (the Company)
is presented to assist in understanding the Company's financial statements.  The
financial  statements and notes are representations of the Company's  management
who is  responsible  for  their  integrity  and  objectivity.  These  accounting
policies  conform to  generally  accepted  accounting  principles  and have been
consistently applied in the preparation of the financial statements.

Nature of Operations
--------------------

The Company was organized and  incorporated on April 21, 1995 and began business
on April 1, 1998. The company  operates a custom  motorcycle  manufacturing  and
service  facility in Kingsport,  TN. The Company offers retail parts and product
sales as well as motorcycle service to its customers seven days a week. Although
principally  located in  Kingsport,  TN, the  Company's  customers  are  located
primarily throughout the United States.

Inventories
-----------

The  Company's  inventories  are  stated at the lower of  standard  cost  (which
approximates average cost) or market.

Property and Equipment
----------------------

Property and equipment are carried at cost. For financial  statement and federal
income tax purposes,  depreciation  is computed  using the modified  accelerated
cost recovery  system.  Expenditures  for major  renewals and  betterments  that
extend the useful lives of property and equipment are capitalized.  Expenditures
for maintenance and repairs are charged to expense as incurred.  Depreciation of
property and  equipment is provided  using rates based on the  following  useful
lives:

<TABLE>
<CAPTION>


                                                            Years
                                                            -----
<S>                                                         <C>
                    Machinery and equipment                 3 - 10
                    Furniture and fixtures                  3 - 10
                    Leasehold Improvements                 20 - 30
</TABLE>

Depreciation expense for the six months ended June 30, 1999 is $ 3,272.

Organization Costs
------------------

Costs of organizing the Company are recorded as organization costs and amortized
over five years on a straight-line basis.

Concentrations of Credit Risk
-----------------------------

The  Company is  engaged in the  manufacture  and  service of highly  customized
motorcycles.  The sales revenues are primarily derived from an area encompassing
a two hundred mile radius of Kingsport,  Tennessee.  The Company performs credit
evaluations of customers in the rare case where credit is granted, and generally
requires no collateral from its customers.


                                       7
<PAGE>

                                 Bad Toys, Inc.
                          Notes to Financial Statements

NOTE B - INVENTORIES

Inventories consisted of the following:
<TABLE>
<CAPTION>

                                       Jun. 30, 1999     Dec. 31, 1998
                                       -------------     -------------
<S>                                     <C>               <C>
                     Work in Process    $  101,025        $   82,862
                     Finished goods        157,635            97,298
                                           -------           -------
                                         $ 258,660        $  180,160
                                           =======           =======
</TABLE>

Inventories are stated at the lower of standard cost (which approximates average
cost) or market.  The Company's  current inventory levels are an accumulation of
motorcycle parts surrounding the production models.  Inventory  obsolescence and
pilferage is adjusted to cost of sales in the period  incurred.  Work in process
consists of partially manufactured  motorcycle models. Finished goods consist of
completed  motorcycle  models and  saleable  motorcycle  parts,  suitable  for a
variety of  Harley-Davidson-type  motorcycles.  Parts within  finished goods are
either  directly  saleable  to the  public or used in the  manufacturing  of the
Company's production units.

NOTE C - PROPERTY AND EQUIPMENT

Property and equipment are summarized by major classifications as follows:

<TABLE>
<CAPTION>

                                             Jun. 30, 1999     Dec. 31, 1998
                                             -------------     -------------
<S>                                            <C>               <C>
                Vehicles                       $  20,328         $   20,328
                Equipment                         17,018             10,042
                Furniture and Fixtures             2,163              2,082
                Leasehold Improvements            45,045             45,045
                                                --------          ---------
                                                  84,554             77,497
                Less accumulated depreciation     (9,256)            (6,543)
                                                --------          ---------
                                               $  75,298          $  70,954
                                                ========          =========

</TABLE>

                                       8

<PAGE>


                                 Bad Toys, Inc.
                          Notes to Financial Statements


NOTE D - LONG-TERM DEBT

Long-term debt consists of the following:
<TABLE>
<CAPTION>

                                                         Jun.  30,  1999          Dec.  31,1998
                                                         ---------------          -------------
<S>                                                       <C>                          <C>
         Bank note payable $629.04 per month plus
         Interest accrued at 9.75%, secured by vehicle.   $    2,524                   5,425

         Bank note payable $285.60 per month plus
         Interest accrued at 9.5%, secured by vehicle.         3,948                   5,503

         Notes payable to individuals, corporations,
         And limited liability companies, with interest
         At 10-10.5%, due at renewal cycle, or at payoff
         Dates ranging from 6-18 months, secured by
         Equity securities.                                   23,175                  24,525

         Notes payable to stockholders due Sept. 30,
         2000 with interest at 10.5%, unsecured.             328,748                 216,176
                                                            --------                --------
                                                             358,395                 251,629
         Less current portion                                 (6,472)               (  8,459)
                                                            --------                --------
         Long-term Debt                                    $ 351,923               $ 243,170
                                                            ========                ========

</TABLE>



Maturities of long-term debt are as follows:
<TABLE>
<CAPTION>

                                     Year Ending
                                     December 31,                   Amount
                                    -------------                   ------
<S>                                                               <C>
                                        1999                      $   6,472

                                        2000                        351,923
                                                                    -------
                                                                  $ 358,395
                                                                    =======
</TABLE>

                                       9
<PAGE>


                                 Bad Toys, Inc.
                          Notes to Financial Statements


NOTE E - INCOME TAXES

Operating Loss Carryforwards

The Company has loss  carryforwards  totaling  $144,154 as of the tax year ended
December 31, 1998 that may be offset against future taxable income. If not used,
the carryforwards will expire as follows:
<TABLE>
<CAPTION>

                                                       Operating
                                                         Losses
                                                         -------
<S>                                                    <C>
                          Year 11                      $     849
                          Year 12                         15,001
                          Year 13                         43,093
                          Year 14                         85,211
                                                         -------
                                                       $ 144,154
                                                         =======
</TABLE>

NOTE F - RELATED PARTY TRANSACTIONS

The following transactions occurred between the Company and affiliated entities:

1.  Notes  payable to related  parties as June 30, 1999 and  December  31, 1998,
    consisted of the following:

<TABLE>
<CAPTION>

                                                    Jun. 30, 1999     Dec. 31, 1998
                                                    -------------     -------------
<S>                                                   <C>               <C>
         Notes payable to Larry & Susan Lunan due
         Sept. 30, 2000 with interest at 10.5%.       $  249,298        $ 178,082

         Notes payable to Barrick Properties, LLC,
         with interest at 10-10.5%, with annual
         renewal options.                                 79,450           38,094
                                                        --------         --------
                                                       $ 328,748        $ 217,176
                                                        ========         ========
</TABLE>

2. The Company leases its facilities from a minority stockholder as described in
Note G below.


NOTE G - LEASING ARRANGEMENTS

The Company  conducts its  operations  from  facilities  that are leased under a
five-year noncancelable operating lease expiring in September, 2002. There is no
option to renew the lease.  The lessor of the facility is a  stockholder  of the
Company. Lessor has received shares of stock as prepaid rent for the term of the
lease. Monthly rent is $1,420,  which includes  monthly-prepaid rent expensed of
$520.


                                       10

<PAGE>


                                 Bad Toys, Inc.
                          Notes to Financial Statements


NOTE G - LEASING ARRANGEMENTS  (continued)


The following is a schedule of future minimum rental payments required under the
above operating lease (excluding prepaid rent expensed) as of June 30, 1999:

<TABLE>
<CAPTION>


                                    Year Ending
                                       Dec. 31,             Amount
                                     ----------            -------
<S>                                                     <C>
                                        1999            $    5,400
                                        2000                10,800
                                        2001                10,800
                                        2002                 8,100
                                                           -------
                                                         $  35,100
                                                           =======
</TABLE>

Rental  expense  for the six months  ended June 30,  1999 and the twelve  months
ended December 31, 1998 were $ 5,010 and $ 20,040, respectively.

NOTE H - OPERATING AND CASH FLOW DEFICITS

The Company has experienced  significant  adversity during the development stage
of its existence. As a result, the Company has a cumulative operating deficit of
$563,396, and current payables, including the current portion of long term debt,
exceeds cash and current receivables by $98,510 at June 30, 1999.  Management is
anticipating a large capital inflow from private placement of equity in the fall
of 1999. While the proposed capital  injection as well as potential  conversions
of long term debt to common stock,  do project to improve the Company's  working
capital position,  there can be no assurance that the Company will be successful
in accomplishing its objectives.

                                       11

<PAGE>

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

     The following  discussion and analysis  should be read in conjunction  with
the financial  statements and the accompanying notes thereto and is qualified in
its  entirety  by the  foregoing  and by  more  detailed  financial  information
appearing elsewhere. See "Item 1. Financial Statements."

     Results of Operations - Second  Quarter of 1999 Compared to Second  Quarter
     ---------------------------------------------------------------------------
of 1998
-------

     Bad Toys' sales  decreased  from  $27,294 in Q2 1998 to $14,545 in Q2 1999.
The decrease is due to the closing of the  Kingsport,  Tennessee  retail  outlet
during April and May (1) to enable  management  to attend the  Laughlin,  Nevada
River  Run  motorcycle  show  and (2) to  enable  the  staff to  complete  three
prototype  models for permanent  display in the Kingsport,  Tennessee,  Phoenix,
Arizona,  and Los Angeles,  California  areas. All sales  represented  parts and
services. We have not yet sold our first custom-made motorcycle.

     The cost of sales in Q2 1999  exceeded  sales by $9,287,  as  compared to a
gross profit of $577 in Q2 1998.  The increase is due to  manufacturing  charges
from the production of three prototypes of the Phoenix model.

     The significant  operational item was general and administrative expenses -
only $26,635 in Q2 1998 but  increasing to $179,356 in Q2 1999.  This produced a
net loss from  operations of $197,362 in Q2 1999, or $0.035 a share, as compared
to a net loss of $30,733 in Q2 1998, or $0.006 a share.

     The  reasons  for the  dramatic  increase  in  general  and  administrative
expenses in Q2 1999 were:

     o        advertising costs related to the Laughlin, Nevada River Run
              motorycle show,

     o        fees to the company's spokesman for his attendance and
              representation of the company at the River Run motorcycle show,

     o        promotional fees paid with regard to our Phoenix-model
              motorcycle being featured in a planned television airing on the
              Discovery or Learning Channels, and

     o        consulting fees paid with regard to our planned expansion.

     We  financed  this  loss by common  stock  sales of  $186,815  and loans of
$112,572 from shareholders.

     Results of Operations - First Half of 1999 Compared to First Half of 1998
     -------------------------------------------------------------------------

     It is evident  that we are still in the  development  stage.  From sales of
$30,022 during the first half of 1998, we were able to manage sales of

                                       12

<PAGE>



only  $24,251  during  the first  half of 1999 - a  decrease  of  almost  twenty
percent.

     General and administrative expenses ballooned from $39,642 during the first
half of 1998 to  $234,989  during  the first half of 1999 - an  increase  of 493
percent.  These increased  expenses  reflect the costs described above that were
incurred during Q2 1999 as well as the costs of pursuing corporation acquisition
opportunities which have not resulted in any agreements.

     Plans for the Rest of 1999; Liquidity; Sources of Liquidity
     -----------------------------------------------------------

     We plan to expand our  operations  in  Kingsport,  Tennessee  and to open a
second  facility  from which to conduct our  business in  Phoenix,  Arizona.  To
execute this plan of expansion  we will require  additional  capital of at least
$250,000 but, preferably,  as much as $500,000.  We have not identified a source
of this  capital  but  propose to conduct  additional  private  placements  with
friends and, if feasible, a public offering later in the year.

     The lessor of our Kingsport  facility has agreed to add an additional 3,000
square feet to the facility  during 1999.  The lessor will bear all the costs of
this  expansion but will charge  additional  rent once the expanded  space is in
use.

     As for our expansion  plans, we first plan,  subject to the availability of
capital, to add approximately  $50,000 in inventory to the present approximately
$140,000  in  inventory  we have in our  Kingsport  facility in order to offer a
complete  line of  equipment,  helmets  and  soft  goods.  We  plan  next to add
approximately $30,000 in plant equipment (benches,  lifts, a milling machine and
a drill press) in order to eliminate the present practice of subcontracting  all
our machine work.

     We then plan to open a second facility in Phoenix,  Arizona, subject to the
availability  of additional  capital.  We plan for the facility  $50,000 in shop
equipment and, depending upon available capital, between $50,000 and $300,000 in
inventory.

     We believe  that the planned  Phoenix  facility,  if built,  will cash flow
positively within 90 days after opening for business.

     Should all the above plans be realized,  we would add approximately fifteen
employees to our payroll.

     Going Concern Issue
     -------------------

     Until we are able to raise capital for expansion, we will continue business
in our single facility in Tennessee.  Should our present Tennessee  facility not
commence to cash flow  positively,  the Company will remain dependent upon loans
to be provided by Barrick Properties,  LLC or Barrick  Properties,  Inc. and the
Lunans.  The  independent  auditor has identified a substantial  doubt about our
ability to continue as a going concern.  A failure to achieve positive cash flow
by the end of 1999 could be fatal to the Company.  We have no  expectation  that
Barrick Properties will continue to provide working capital,  and the ability of
the Lunans to provide

                                       13

<PAGE>


additional capital - other than the contribution of their personal services - is
quite limited.


Item 6.           Exhibits and Reports on Form 8-K

(a)  Exhibits

     Exhibit 27                 Financial Data Schedule

(b)  Forms 8-K

     None

                                   SIGNATURES

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

Date:  August 23, 1999                          Bad Toys, Inc.



                                                By/s/Larry N. Lunan
                                                  -----------------------------
                                                  Larry N. Lunan, President and
                                                  Chief Financial Officer

                                       14