UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D. C. 20549
                           -------------------------


                                   FORM 10-Q


                Quarterly Report Pursuant to Section 13 or 15(d)
                     of the Securities Exchange Act of 1934


For the quarterly period ended                          Commission file number
    September 9, 1997                                         000-22753
    -----------------                                         ---------


                      TOTAL ENTERTAINMENT RESTAURANT CORP.
             (Exact name of registrant as specified in its charter)



           Delaware                                            52-2016614
           --------                                            ----------
(State or other jurisdiction of                            (I.R.S. Employer
incorporation or organization)                           Identification Number)

                               300 Crescent Court
                            Building 300, Suite 850
                              Dallas, Texas 75201
              (Address of principal executive offices) (Zip code)

                                 (214) 754-0414
              (Registrant's telephone number, including area code)

            Indicate  by check mark  whether  the  registrant  (1) has filed all
documents  and  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. 

                                                                /X/ Yes / / 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 October 24, 1997
Common Stock, $.01 par value                            10,415,000 shares


<PAGE>

                      TOTAL ENTERTAINMENT RESTAURANT CORP.

                                     Index

                                                                           Page
                                                                          Number
                                                                          ------
PART I.   FINANCIAL INFORMATION
-------------------------------

Item 1.  Financial Statements

   Condensed Consolidated Balance Sheets
   at September 9, 1997, March 25, 1997, and
   February 7, 1997                                                       2

   Consolidated Statements of Income
   for the twelve weeks ended
   September 9, 1997 and Pro Forma for
   the twelve weeks ended September 3, 1996                               3

   Consolidated Statements of Income for the 
   30 weeks and 5 days ended September 9, 1997 
   (since inception) and Pro Forma for the 
   thirty-six weeks ended September 9, 1997 
   and September 3, 1996                                                  4

   Condensed Consolidated Statement of Cash Flows 
   for the 30 weeks and 5 days ended
   September 9, 1997 (since inception)                                    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
---------------------------

Item 2.  Changes in Securities and Use of Proceeds                       15

Item 6.  Exhibits and Reports on Form 8-K                                16



                                      -1-
<PAGE>
                      TOTAL ENTERTAINMENT RESTAURANT CORP.
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                      September 9, 1997   March 25,1997     February 7, 1997
                                                                      -----------------  --------------     ----------------
                                         ASSETS

<S>                                                                      <C>               <C>                <C>     
Current assets:
    Cash and cash equivalents                                            $ 8,553,639       $  1,458,789       $  1,000
    Accounts receivable                                                       56,934            106,731              -
    Inventories                                                              279,949            261,517              -
    Pre-opening costs - net                                                  187,739            124,883              -
    Deferred income taxes                                                    185,376            100,194              -
    Other current assets                                                     310,119            211,249              -
                                                                         -----------        -----------       --------
         Total current assets                                              9,573,756          2,263,363          1,000

Property and equipment, net                                                8,627,754          7,147,349              -
Intangible and other assets, net (principally goodwill)                    4,749,798          4,777,871              -
                                                                         -----------        -----------       --------
            Total assets                                                 $22,951,308       $ 14,188,583       $  1,000
                                                                         ===========        ===========       ========
                             LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
    Notes payable                                                       $          -       $ 10,835,695              -
    Accounts payable                                                       1,289,078            962,610       $      -
    Other current liabilities                                                469,759            594,715              -
                                                                        ------------       ------------       --------
            Total current liabilities                                      1,758,837         12,393,020              -


Deferred income taxes                                                        211,088            175,726              -

Stockholders' Equity:
    Preferred stock                                                                -                  -              -
    Common stock                                                             104,150             80,000             80
    Additional paid-in capital                                            20,553,772          1,450,390            920
    Retained earnings                                                        323,461             89,447              -
                                                                        ------------       ------------       --------
            Total stockholders' equity                                    20,981,383          1,619,837          1,000
                                                                        ------------       ------------       --------
            Total liabilities and stockholders' equity                  $ 22,951,308       $ 14,188,583       $  1,000
                                                                        ============       ============       ========
</TABLE>

                             See accompanying notes.
                                      - 2 -


<PAGE>
                      TOTAL ENTERTAINMENT RESTAURANT CORP.
                        CONSOLIDATED STATEMENTS OF INCOME
                                   (UNAUDITED)


<TABLE>
<CAPTION>
                                                                                                             Company
                                                                                    Historical              Pro Forma
                                                                                -------------------    ---------------------
                                                                                   Twelve weeks            Twelve weeks
                                                                                       ended                  ended
                                                                                   Sept. 9, 1997          Sept. 3, 1996
                                                                                -------------------    ---------------------
<S>                                                                                 <C>                   <C>        

Net sales:
    Food and beverage                                                               $ 3,028,242           $ 2,657,291
    Entertainment and other                                                             650,461               552,112
                                                                                    -----------           -----------
         Total net sales                                                              3,678,703             3,209,403

Costs and expenses:
    Costs of sales                                                                      967,522               899,709
    Restaurant operating expenses                                                     1,648,225             1,519,732
    Depreciation and amortization                                                       242,919               194,759
                                                                                    -----------           -----------
Entertainment and restaurant costs and expenses                                       2,858,666             2,614,200
                                                                                    -----------           -----------
Entertainment and restaurant operating income                                           820,037               595,203
General and administrative expenses                                                     411,175               264,771
Goodwill amortization                                                                    54,684                54,684
                                                                                    -----------           -----------
Income from operations                                                                  354,178               275,748

Other income (expense):
    Other income, principally interest                                                   41,017                 4,933
    Interest expense                                                                    (91,778)             (159,150)
                                                                                    -----------           -----------
Income before income taxes                                                              303,417               121,531
Provision for income taxes                                                              113,781                45,574
                                                                                    -----------           -----------
Net income                                                                          $   189,636           $    75,957
                                                                                    ===========           ===========

Net income per share                                                                $      0.02           $      0.01
                                                                                    ===========           ===========
Average shares outstanding                                                            9,610,000             8,000,000
                                                                                    ===========           ===========
</TABLE>



                             See accompanying notes
                                      - 3 -


<PAGE>
                      TOTAL ENTERTAINMENT RESTAURANT CORP.
                        CONSOLIDATED STATEMENTS OF INCOME
                                   (UNAUDITED)


<TABLE>
<CAPTION>
                                                                Historical
                                                          ----------------------                   Company Pro Forma
                                                             For the 30 weeks     --------------------------------------------------
                                                             and 5 days ended              For the thirty-six weeks ended
                                                            September 9, 1997     --------------------------------------------------
                                                            (since inception)        September 9, 1997         September 3, 1996
                                                          ----------------------  ----------------------    ------------------------

<S>                                                           <C>                     <C>                       <C>         
Net sales:
    Food and beverage                                         $  7,714,879            $  9,686,806              $  7,941,430
    Entertainment and other                                      1,646,957               2,069,488                 1,658,078
                                                              ------------            ------------              ------------
         Total net sales                                         9,361,836              11,756,294                 9,599,508
Costs and expenses:
    Costs of sales                                               2,442,988               3,097,698                 2,690,258
    Restaurant operating expenses                                4,231,391               5,304,745                 4,466,390
    Depreciation and amortization                                  578,939                 707,507                   538,144
                                                              ------------            ------------              ------------
Restaurant costs and expenses                                    7,253,318               9,109,950                 7,694,792
                                                              ------------            ------------              ------------
Restaurant operating income                                      2,108,518               2,646,344                 1,904,716
General and administrative expenses                              1,106,060               1,346,135                   565,248
Goodwill amortization                                              130,855                 163,144                   164,058
                                                              ------------            ------------              ------------
Income from operations                                             871,603               1,137,065                 1,175,410

Other income (expense):
    Other income, principally interest                              41,102                  41,165                    18,609
    Interest expense                                              (395,168)               (499,035)                 (438,576)
                                                              ------------            ------------              ------------
Income before income taxes and minority interest                   517,537                 679,195                   755,443
Provision for income taxes                                         194,076                 254,698                   283,291
                                                              ------------            ------------              ------------
Net income                                                    $    323,461            $    424,497              $    472,152
                                                              ============            ============              ============

Net income per share                                          $       0.04            $       0.05              $       0.06
                                                              ============            ============              ============
Average shares outstanding                                       8,629,023               8,536,667                 8,000,000
                                                              ============            ============              ============
</TABLE>



                             See accompanying notes.
                                      - 4 -

<PAGE>

                      TOTAL ENTERTAINMENT RESTAURANT CORP.
                 CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
                INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
                                   (UNAUDITED)


                                                             For the 30 weeks
                                                             and 5 days ended 
                                                             September 9, 1997 
                                                             (since inception)
                                                           --------------------
 Cash flows from operating activities:
   Net income                                                $    323,461
   Adjustments to reconcile net income to net cash
     provided by operating activities:
        Depreciation and amortization                             732,095
        Net change in operating assets
        and liabilities:
          Change in operating assets                             (460,936)
          Change in operating liabilities                         976,981
                                                             ------------
            Net cash provided by operating activities           1,571,601

Cash flows from investing activities:
   Purchases of property and equipment                         (2,074,963)
   Cash of companies acquired in Exchange                         733,804
                                                             ------------
            Net cash provided by investing activities          (1,341,159)

Cash flows from financing activities:
   Net proceeds from sale of stock                             19,127,532
   Proceeds from revolving note payable to bank                10,835,695
   Payment of dividends to certain stockholders                (1,675,332)
   Payment of notes payable to stockholders                    (4,530,071)
   Payment of notes payable to affiliates                        (233,000)
   Payment of notes payable to banks                           (4,366,933)
   Payment of revolving note payable to bank                  (10,835,695)
                                                             ------------
            Net cash provided by financing activities           8,322,196
                                                             ------------

            Net increase in cash and cash equivalents           8,552,639

Cash and cash equivalents at beginning of period                    1,000
                                                             ------------
Cash and cash equivalents at end of period                   $  8,553,639
                                                             ============

Supplemental disclosure of cash flow information:
   Cash paid for interest                                    $   425,527
   Cash paid for income taxes                                    189,790


                             See accompanying notes.
                                      - 5 -


<PAGE>

                      TOTAL ENTERTAINMENT RESTAURANT CORP.
              Notes to Condensed Consolidated Financial Statements


(Note 1)  Basis of Presentation and Description of Business
          -------------------------------------------------

            Total  Entertainment  Restaurant Corp. (the "Company") was organized
as a Delaware  corporation  on February 7, 1997,  for the purpose of  developing
entertainment  restaurant  locations.  Effective  February 20, 1997, the Company
entered into simultaneous securities exchange transactions pursuant to which the
Company  issued an aggregate of 8,000,000  shares of its common stock,  $.01 par
value per share (the "Common  Stock"),  in exchange  for all of the  outstanding
common stock of each of Bailey's Sports Grille,  Inc., F&H Restaurant Corp., Fox
& Hound,  Inc. and Fox & Hound II, Inc. and the remaining 25% minority  interest
in each of 505 Entertainment, Ltd., F&H Dallas, L.P., Midway Entertainment, Ltd.
and N. Collins Entertainment,  Ltd. (the "Exchange"). The Exchange was accounted
for as a  business  combination  using  the  purchase  method of  accounting  in
accordance with APB No. 16. For accounting  purposes,  F&H Restaurant  Corp. was
deemed to be the acquiring  corporation  since, upon completion of the Exchange,
its former stockholders controlled 50% of the Company.  Accordingly,  the assets
and  liabilities  of F&H  Restaurant  Corp.  were recorded by the Company on the
acquisition date using their historical amounts.

            The operations of the Company effectively  commenced on February 20,
1997,  and  include  the  operating  results of the  companies  acquired  in the
Exchange from that date. The acquired assets and  liabilities  assumed have been
recorded at their  estimated fair market values at the Exchange  date,  with the
exception of the F&H Restaurant Corp. which was recorded at its historical costs
as  described  above.  The  Exchange   resulted  in  goodwill  of  approximately
$4,740,000,  including  approximately  $3,448,000  previously  recorded  by  F&H
Restaurant  Corp. in its acquisition of its 75% partnership  interest in each of
the four limited partnerships  mentioned above, such goodwill is being amortized
over 20 years. The preliminary  purchase price allocation to the assets acquired
and liabilities assumed in the Exchange are summarized as follows:

     Assets acquired:
         Current assets                                           $1,498,276
         Property and equipment                                    7,039,719
         Goodwill and other assets                                 4,789,911
                                                                  ----------
                                                                  13,327,906
     Less assumed liabilities:
         Current liabilities                                         822,428
         Dividends payable to certain predecessor stockholders     1,675,332
         Notes payable to stockholder                              4,530,071
         Notes payable to affiliates                                 233,000
         Notes payable to banks                                    4,366,933
         Deferred taxes                                              170,752
                                                                  ----------
     Net assets acquired                                          $1,529,390
                                                                  ==========


                                      -6-
<PAGE>


            Upon  formation,  the Company issued 8,000 shares of Common Stock at
$0.0125 per share. In connection  with the Exchange,  these shares were canceled
and 100,000  new shares of Common  Stock were  issued.  In  February  1997,  the
Company's Board of Directors approved a 79 for 1 stock dividend.  All share, per
share and stock option data included in the  accompanying  balance sheet,  notes
thereto  and  elsewhere  in the  Form  10-Q  give  effect  to the 79 for 1 stock
dividend.

            The unaudited pro forma Consolidated Statements of Income for the 12
weeks  ended  September  3, 1996 and the 36 weeks  ended  September  9, 1997 and
September 3, 1996 give effect to the Exchange as if such  transactions  occurred
on January 1, 1996.

            The unaudited Condensed  Consolidated Financial Statements have been
prepared by the Company, pursuant to the rules and regulations of the Securities
and  Exchange  Commission.   The  information   furnished  herein  reflects  all
adjustments (consisting of normal recurring accruals and adjustments) which are,
in the opinion of management,  necessary to fairly present the operating results
for  the  respective  periods.  Certain  information  and  footnote  disclosures
normally  presented in annual financial  statements  prepared in accordance with
generally  accepted  accounting  principles  have been omitted  pursuant to such
rules and regulations.  These financial statements should be read in conjunction
with the  consolidated  financial  statements  and unaudited pro forma  combined
condensed  statement  of  operations  and notes  thereto of the  Company and its
predecessors  contained in the Company's  registration  statement dated July 17,
1997.  The  results  of the  twelve  weeks  ended  September  9,  1997  are  not
necessarily  indicative  of the results to be expected  for the full year ending
December 30, 1997.


2.          Initial Public Offering
            -----------------------

            On July 17, 1997, the Company  commenced the initial public offering
(the "Initial Public  Offering") of 2,100,000  shares of its Common at $9.00 per
share. Total net proceeds to the Company of approximately  $16,490,000 are being
used for debt retirement,  restaurant  development,  working capital and general
corporate  purposes.  On  July  23,  1997,  the  underwriters   exercised  their
over-allotment  option and acquired an additional 315,000 shares of Common Stock
for which the Company received net proceeds of approximately $2,640,000.


3.          Stock Options
            -------------

            o   Incentive and Nonqualified Stock Option Plan

            In March 1997,  the Board of  Directors  adopted a stock option plan
providing for incentive and  nonqualified  stock options pursuant to which up to
1,500,000  shares of Common  Stock have been  reserved  for  issuance.  The Plan
covers the  Chairman of the Board,  officers  and key  employees of the Company.
Concurrent with the effective date of the Initial Public Offering of the Company
on July 17,  1997,  the Company  granted  options to the  Chairman of the Board,
certain officers and key employees to purchase an aggregate of 801,340 shares of
Common Stock at an exercise price of $9.00 per share.


                                      -7-
<PAGE>




            o   Directors Stock Option Plan

            In March 1997,  the Board of  Directors  adopted a stock option plan
providing for nondiscretionary grants to nonemployee directors pursuant to which
up to 150,000  shares of Common Stock have been reserved for issuance.  The Plan
covers  the  nonemployee  directors  other  than  the  Chairman  of  the  Board.
Concurrent with the effective date of the Initial Public  Offering,  the Company
granted options to directors to purchase an aggregate of 50,000 shares of Common
Stock at an exercise price of $9.00 per share.

4.          Recently Issued Accounting Standards
            ------------------------------------

            In February 1997, the Financial  Accounting  Standards  Board issued
            Statement  of Final  Accounting  Standards  No. 128,  "Earnings  per
            Share" ("FAS 128"),  which specifies the computation,  presentation,
            and  disclosure   requirements  for  earnings  per  share  with  the
            objective to simplify the computation of earnings per share. FAS 128
            is  effective  for  financial  statements  for periods  ending after
            December 15, 1997 and earlier  application is not  permitted.  After
            the effective  date, all prior period  earnings per share data shall
            be restated to conform with the  provisions of FAS 128. The adoption
            of  FAS  128 is not  expected  to  have  a  material  impact  on the
            Company's earnings per share data.


                                      -8-
<PAGE>


                      TOTAL ENTERTAINMENT RESTAURANT CORP.

                    MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                 FINANCIAL CONDITION AND RESULTS OF OPERATIONS

General

            The following  discussion and analysis should be read in conjunction
with the Financial  Statements and Notes thereto included elsewhere in this Form
10-Q.

            The  Company  was formed on  February  7, 1997 and,  pursuant to the
Exchange,  the Company became the owner of eight then-existing  Bailey's and the
three Fox & Hound locations.  The first Bailey's was opened in Charlotte,  North
Carolina  in 1989 and the first Fox & Hound was  opened in  Arlington,  Texas in
1994. As of September 9, 1997, the Company operated nine Bailey's and four Fox &
Hounds located in Arkansas,  Indiana, North Carolina, South Carolina,  Tennessee
and Texas.

            The components of the Company's net sales are food and non-alcoholic
beverages,  alcoholic beverages, and entertainment and other. For the thirty-six
weeks ended  September 9, 1997, food and  non-alcoholic  beverages were 24.8% of
total sales, alcoholic beverages were 57.6% of total sales and entertainment and
other were 17.6% of total sales.

            Components  of  restaurant   operating  expenses  include  operating
payroll and fringe benefit costs,  occupancy costs and advertising and promotion
costs.  These costs are generally  variable and will  fluctuate  with changes in
sales volume and sales mix. All but one of the  Company's  locations  are leased
and provide for a minimum  annual rent,  with some leases calling for additional
rent based on sales  volume at the  particular  location  of  specified  minimum
levels.

            Pre-opening costs include labor costs,  costs of hiring and training
personnel and certain other costs relating to opening new  restaurants,  and are
capitalized  and amortized over a 12 month period,  beginning in the period that
the restaurants open.

            General  and  administrative  expenses  include  all  corporate  and
administrative  functions  that  support  existing  operations  and  provide  an
infrastructure  to support  future  growth.  In  addition,  certain  expenses of
recruiting and training unit management  personnel prior to meeting the criteria
to be  capitalized  as  pre-opening  expenses  are  also  included.  Management,
supervisory and staff salaries,  employee benefits, travel, information systems,
training,  rent and office  supplies are major items of costs in this  category.
From  February  20,  1997  through  the  effective  date of the  Initial  Public
Offering,   the  Company  has  been   provided  with  certain   accounting   and
administrative services from Coulter Enterprises,  Inc. a corporation controlled
by Jamie B. Coulter,  Chairman of the Board of the Company, for a charge of 4.0%
of net sales. Concurrent with the effective date of the Initial Public Offering,
the Company entered into a services agreement with Coulter Enterprises, Inc. for
a continuation  of such  services.  The fixed annual charge for such services is
$94,000, pro rated for 1997 plus an additional per 28-day period fee of $426 per
unit.

                                      -9-
<PAGE>



                      TOTAL ENTERTAINMENT RESTAURANT CORP.

                    MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                 FINANCIAL CONDITION AND RESULTS OF OPERATIONS




Results of Operations
            The  following  table sets forth for the periods  indicated  (i) the
percentages  which  certain  items  included in the  Consolidated  Statements of
Income bear to net sales, and (ii) other selected operating data:

<TABLE>
<CAPTION>
                                                                             Historical      Company Pro Forma (2)
                                                                             ----------   --------------------------------------
                                                                           Twelve Weeks  Twelve Weeks
                                                                              Ended          Ended        Thirty-six Weeks Ended
                                                                              -----          -----        ----------------------
                                                                             Sept. 9,      Sept. 3,       Sept. 9,       Sept. 3,
                                                                               1997          1996          1997             1996
                                                                               ----          ----          ----             ----

                                                                                            (dollars in thousands)

<S>                                                                          <C>         <C>            <C>            <C>     
Income Statement Data:
   Net sales ..........................................................      100.0%         100.0%         100.0%         100.0%
   Costs and expenses:
               Costs of sales .........................................       26.3           28.0           26.4           28.0
               Restaurant operating expenses ..........................       44.8           47.4           45.1           46.5
               Depreciation and amortization ..........................        6.6            6.1            6.0            5.6
                                                                               ---            ---            ---            ---

                  Restaurant costs and expenses .......................       77.7           81.5           77.5           80.2
                                                                              ----           ----           ----           ----

   Restaurant operating income ........................................       22.3           18.5           22.5           19.8
   General and administrative expenses ................................       11.2            8.2           11.5            5.9
   Goodwill amortization ..............................................        1.5            1.7            1.4            1.7
                                                                               ---            ---            ---            ---
   Income from operations .............................................        9.6            8.6            9.6           12.2
   Other income, principally interest .................................        1.1            0.2            0.4            0.2
   Interest expense ...................................................       (2.5)          (5.0)          (4.2)          (4.5)
                                                                               ---            ---            ---            ---

   Income before provision for income taxes (2) .......................        8.2            3.8            5.8            7.9
   Provision for income taxes .........................................        3.1            1.4            2.2            3.0
                                                                               ---            ---            ---            ---

   Net income .........................................................        5.1%           2.4%           3.6%           4.9%
                                                                               ===            ===            ===            === 


Restaurant Operating Data:
    Annualized average weekly sales per location (3)$ .........              1,319       $  1,388       $  1,437       $  1,468
    Number of restaurants at end of the period ................                 13             10             13             10
</TABLE>                                                         


(1) The Company  operates on a fifty-two or fifty-three  week fiscal year ending
    the last Tuesday in December. The fiscal quarters for the Company consist of
    accounting periods of twelve, twelve, twelve and sixteen or seventeen weeks,
    respectively.

(2) The pro forma data gives effect to the Exchange as if it occurred on January
    1, 1996.

(3) Annualized  average  weekly  sales per location are computed by dividing net
    sales for full weeks open during the period by the number of full weeks open
    and multiplying the result by fifty-two.


                                      -10-
<PAGE>

                      TOTAL ENTERTAINMENT RESTAURANT CORP.

TWELVE WEEKS ENDED SEPTEMBER 9, 1997 COMPARED TO
TWELVE WEEKS ENDED SEPTEMBER 3, 1996


         Net  sales  increased  $469,000  (14.6%)  for the  twelve  weeks  ended
September  9,  1997  compared  to the  twelve  weeks  ended  September  3,  1996
principally  attributable  to  $549,000  in sales  from the three new  locations
opened since June 1996. Same store sales were down 0.4% in the third quarter.

         Costs of sales,  primarily food and beverages  increased $68,000 (7.5%)
in the twelve  weeks ended  September 9, 1997 to $968,000  from  $900,000 in the
twelve  weeks  ended  September  3,  1996,  and  such  expenses  decreased  as a
percentage  of sales from  28.0% to 26.3%.  This  decrease  is  attributable  to
improved control  procedures and a new menu implemented during the first quarter
of 1997.

         Restaurant  operating  expenses for the twelve weeks ended September 9,
1997  increased  $128,000  (8.5%)  from  $1,520,000  in the twelve  weeks  ended
September 3, 1996 to $1,648,000,  and such expenses decreased as a percentage of
net sales from  47.4% to 44.8%.  Most of this  improvement  is  attributable  to
improved labor controls at the locations.

         Depreciation and amortization  increased  $48,000 (24.7%) in the twelve
weeks ended  September  9, 1997 over the twelve  weeks ended  September 3, 1996,
principally  reflecting  the  depreciation  relating to the opening of three new
restaurants since June 1996 including one owned property.

         General  and  administrative   expenses  for  the  twelve  weeks  ended
September 9, 1997 increased $146,000 (55.3%) from the comparable period in 1996.
The increase reflects the management fee paid to Coulter Enterprises, Inc. prior
to the Initial Public Offering and the additional corporate infrastructure added
during  the first  quarter of 1997 to enable  the  Company  to  rapidly  develop
additional units.

         Interest  expense  for the twelve  weeks  ended  September  9, 1997 was
$92,000,  a $67,000  decrease from the comparable  period in 1996. This decrease
reflects the repayment of all debt outstanding immediately following the initial
public offering.

         The effective  income tax rate for the twelve weeks ended  September 9,
1997 and the  effective  pro forma  income tax rate for the twelve  weeks  ended
September 3, 1996 were both 37.5%.



                                      -11-
<PAGE>
                      TOTAL ENTERTAINMENT RESTAURANT CORP.

THIRTY-SIX WEEKS ENDED SEPTEMBER 9, 1997
COMPARED TO THIRTY-SIX WEEKS ENDED SEPTEMBER 3, 1996

         Net sales increased  $2,157,000  (22.5%) for the thirty-six weeks ended
September  9, 1997  compared to the  thirty-six  weeks ended  September  3, 1996
principally  attributable  to  $2,477,000  in sales from the four new  locations
opened since December 1995. Same store sales were up 4.9% for the period.

         Costs of sales, primarily food and beverages increased $408,000 (15.1%)
in the thirty-six weeks ended September 9, 1997 to $3,098,000 from $2,690,000 in
the thirty-six  weeks ended September 3, 1996, and such expenses  decreased as a
percentage  of sales from  28.0% to 26.4%.  This  decrease  is  attributable  to
improved control  procedures and a new menu implemented during the first quarter
of 1997.

         Restaurant  operating expenses for the thirty-six weeks ended September
9, 1997 increased $838,000 (18.8%) from $4,467,000 in the thirty-six weeks ended
September 3, 1996 to $5,305,000,  and such expenses decreased as a percentage of
net sales from  46.5% to 45.1%.  Most of this  improvement  is  attributable  to
improved labor controls at the locations.

         Depreciation  and  amortization   increased  $169,000  (31.5%)  in  the
thirty-six  weeks  ended  September  9, 1997  over the  thirty-six  weeks  ended
September  3, 1996,  principally  reflecting  the  depreciation  relating to the
opening  of four  new  restaurants  since  December  1995  including  one  owned
property.

         General and  administrative  expenses  for the  thirty-six  weeks ended
September 9, 1997  increased  $781,000  (138.1%) from the  comparable  period in
1996. The increase reflects the management fee paid to Coulter Enterprises, Inc.
prior to the Initial Public Offering and the additional corporate infrastructure
added during the first quarter of 1997 to enable the Company to rapidly  develop
additional units.

         Interest  expense for the thirty-six  weeks ended September 9, 1997 was
$499,000, a $60,000 increase from the comparable period in 1996.


         The effective  income tax rate for the thirty-six weeks ended September
9, 1997 and the  effective  pro forma income tax rate for the  thirty-six  weeks
ended September 3, 1996 were both 37.5%.


                                      -12-
<PAGE>
                      TOTAL ENTERTAINMENT RESTAURANT CORP.

IMPACT OF INFLATION

            The primary  inflationary factors affecting the Company's operations
include food,  liquor and labor costs.  Although a large number of the Company's
restaurant personnel are paid at the federal minimum wage level, the majority of
personnel are tipped employees, and therefore,  recent as well as future minimum
wage changes will have very little  effect on labor costs.  As costs of food and
labor have  increased,  the Company has  historically  been able to offset these
increases through economies of scale and improved operating procedures. To date,
inflation has not had a material impact on operating margins.

LIQUIDITY AND CAPITAL RESOURCES

            The  Company  was formed on  February  7, 1997 and,  pursuant to the
Exchange,  the  Company  became  the owner of the eight  then-existing  Bailey's
locations  and  three Fox & Hound  locations.  Prior to the  Exchange,  Bailey's
financed its expansion  primarily  with loans from  stockholders  and loans from
banks. Prior to the Exchange,  Fox & Hound financed its expansion primarily with
partners' equity contributions and loans from related parties.

            As is customary in the restaurant industry, the Company prior to the
Initial Public Offering had operated with negative working capital.  The Company
does not have  significant  receivables  or inventory and receives  trade credit
based upon  negotiated  terms in  purchasing  food and  supplies.  Because funds
available  from  cash  sales  are not  needed  immediately  to pay for  food and
supplies,  or to  finance  inventory,  they may be  considered  as a  source  of
financing for noncurrent capital expenditures.

            Immediately  following  the  Initial  Public  Offering,  the Company
repaid outstanding indebtedness to Intrust Bank, N.A., Wichita, in the principal
amount  of  approximately  $10.8  million  out of a total  credit  line of $12.0
million available to the Company. This outstanding  indebtedness was incurred to
refinance  the debt of the acquired  entities in the  Exchange of  approximately
$9.1  million  and to finance  the  stockholder  dividend  payment to the former
stockholders  of  Bailey's  of  approximately  $1.7  million.  While the Company
believes it can arrange a new working  capital line with Intrust Bank,  N.A., no
definitive agreement has been entered into for a new line of credit facility and
there is no assurance that the Company will be able to establish such facility.

            The  Company  intends to open five  locations  in 1997 (two of which
were opened during the thirty-six  week period ending  September 9, 1997, one of
which  was  opened  in  October  1997  and  two of  which  are  currently  under
construction).  One  additional  unit is currently  under  construction  and the
Company is in active  negotiations  for  leases on five  additional  sites.  The
Company expects to expend approximately $19.8 million to open new locations over
the next 12 months.

            The Company  believes  that the  proceeds  from the  Initial  Public
Offering,  its cash flow from  operations and funds  anticipated to be available
from a credit  facility will be  sufficient  to satisfy 



                                      -13-
<PAGE>

its working capital and capital  expenditure  requirements for at least the next
12 months.  There can be no  assurance,  however,  that changes in the Company's
operating plans, the  unavailability  of a credit facility,  the acceleration of
the  Company's  expansion  plans,  lower than  anticipated  revenues,  increased
expenses,  potential  acquisitions or other events will not cause the Company to
seek additional  financing  sooner than  anticipated.  There can be no assurance
that additional financing will be available on acceptable terms or at all.

FORWARD LOOKING STATEMENTS

            This report contains certain  forward-looking  statements within the
meaning of Section 27A of the  Securities  Act of 1933, as amended,  and Section
21E of the  Securities  Exchange  Act of  1934,  as  amended.  Stockholders  are
cautioned that all  forward-looking  statements  involve risks and  uncertainty,
including  without   limitation,   the  ability  of  the  Company  to  open  new
restaurants,  general market conditions,  competition and pricing.  Although the
Company  believes the  assumptions  underlying  the  forward-looking  statements
contained  herein are reasonable,  any of the  assumptions  could be inaccurate,
and, therefore,  there can be no assurance that the  forward-looking  statements
contained in the report will prove to be accurate.



                                      -14-
<PAGE>

                      TOTAL ENTERTAINMENT RESTAURANT CORP.


PART II.  OTHER INFORMATION
---------------------------

Item 2.     Changes in Securities and Use of Proceeds
            -----------------------------------------

Securities Sold
---------------

 (c)  The following  unregistered  securities  were issued by the Company during
      the twelve weeks ended September 9, 1997:


<TABLE>
<CAPTION>
                          Description of          Number of Shares Sold/Issued/       Offering/Exercise       Purchaser or
Date of Sale/Issuance    Securities Issued       Subject to Options or Warrants      Price Per Share             Class
---------------------    -----------------       ------------------------------      ---------------             -----

<S>                     <C>                              <C>                                <C>            <C>
July 17, 1997           Common Stock Options             801,340                            $ 9.00         Chairman of the
                                                                                                           Board, certain officers
                                                                                                           and key employees
                                                                                                           pursuant to 1997
                                                                                                           Incentive and
                                                                                                           Nonqualified Stock
                                                                                                           Option Plan
                                                                    
July 17, 1997           Common Stock Options              50,000                           $ 9.00          Issuance to non-
                                                                                                           employee directors
                                                                                                           pursuant to 1997
                                                                                                           Directors Stock
                                                                                                           Option Plan
</TABLE>

The  issuance  of these  securities  is claimed to be exempt  from  registration
pursuant  to  Section  4(2)  of the  Securities  Act of  1933,  as  amended,  as
transactions  by an  issuer  not  involving  a public  offering.  There  were no
underwriting  discounts or commissions  paid in connection  with the issuance of
any of these securities.

                                      -15-
<PAGE>

                      TOTAL ENTERTAINMENT RESTAURANT CORP.


  Use of Proceeds of Initial Public Offering
  ------------------------------------------

   (4) (v)  Actual underwriting discounts and commissions        $  1,521,450

            Actual other  expenses  paid to a  corporation
            controlled  by Jamie B.  Coulter,  Chairman of
            the Board of the Company, for air travel                   82,325


            Estimated other expenses paid to others                 1,003,693
                                                                    ---------
            Total expenses                                       $  2,607,468

       (vi) Net offering proceeds                                $ 19,127,532

      (vii) Amount of net offering proceeds used for:
            Actual repayment of indebtedness including interest  $ 10,894,648
            Estimated purchases and installation of 
            furniture, fixtures and equipment                         590,982
            Estimated remaining net offering proceeds invested 
            in various tax exempt securities and funds              7,631,902
                                                                    ---------
            Total net offering proceeds                          $ 19,127,532

     (viii) Not applicable


Item 6.  Exhibits and Reports on Form 8-K
         --------------------------------

         (a)   Exhibit 27. . . . . .. . . . . . .     Financial Data Schedule

         (b)   Forms on 8-K. . . .  . . . . . . .     None


                                      -16-
<PAGE>



                      TOTAL ENTERTAINMENT RESTAURANT CORP.

                                   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.

                                    Total Entertainment Restaurant Corp.
                                    (Registrant)

  Date        10/24/97              /s/ James K. Zielke
                                    ------------------------------------
                                    Chief Financial Officer,
                                    Secretary and Treasurer
                                    (Duly Authorized Officer)




                                      -18-