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
            June 17, 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.
                                                   / / 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 August 25, 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 June 17, 1997, March 25, 1997, and
  February 7, 1997                                                          2

  Consolidated Statements of Income
  for the twelve weeks ended
  June 17, 1997 and June 11, 1996                                           3

  Consolidated  Statements of Income 
  for the 18 weeks and 5 days ended 
  June 17, 1997 (since inception) and for 
  the twenty-four weeks ended
  June 17, 1997 and June 11, 1996                                           4

  Condensed Consolidated Statement of
  Cash Flows for the 18 weeks and 5 days
  ended June 17, 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 4.  Submission of Matters to Vote of Security Holders                 15

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





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



<TABLE>
<CAPTION>
                                                                        June 17, 1997       March 25,1997      February 7, 1997
                                                                        -------------       -------------      -----------------
<S>                                                                     <C>                 <C>                 <C>
            ASSETS

Current assets:
    Cash and cash equivalents                                           $   960,198         $ 1,458,789         $     1,000
    Accounts receivable                                                      58,905             106,731                --
    Inventories                                                             260,654             261,517                --
    Pre-opening costs - net                                                  86,819             124,883                --
    Deferred income taxes                                                   142,785             100,194                --
    Other current assets                                                    151,142             211,249                --
                                                                        -----------         -----------         -----------
         Total current assets                                             1,660,503           2,263,363               1,000

Property and equipment, net                                               7,262,430           7,147,349                --
Intangible and other assets, net (principally goodwill)                   4,883,068           4,777,871                --
                                                                        -----------         -----------         -----------
            Total assets                                                $13,806,001         $14,188,583         $     1,000
                                                                        ===========         ===========         ===========
                             LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
    Notes payable                                                       $10,835,695         $10,835,695                --
    Accounts payable                                                        690,489             962,610         $      --
    Other current liabilities                                               422,194             594,715                --
                                                                        -----------         -----------         -----------
            Total current liabilities                                    11,948,378          12,393,020                --


Deferred income taxes                                                       193,407             175,726                --
Stockholders' Equity:
    Preferred stock                                                            --                  --                  --
    Common stock                                                             80,000              80,000                  80
    Additional paid-in capital                                            1,450,390           1,450,390                 920
    Retained earnings                                                       133,826              89,447                --
                                                                        -----------         -----------         -----------
            Total stockholders' equity                                    1,664,216           1,619,837               1,000
                                                                        -----------         -----------         -----------
            Total liabilities and stockholders' equity                  $13,806,001         $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
                                                                June 17, 1997  June 11, 1996
                                                                 -----------    -----------

<S>                                                              <C>            <C>        
Net sales:
    Food and beverage                                            $ 3,298,371    $ 2,616,828
    Entertainment and other                                          694,389        536,524
                                                                 -----------    -----------
         Total net sales                                           3,992,760      3,153,352
Costs and expenses:
    Costs of sales                                                 1,046,479        891,751
    Restaurant operating expenses                                  1,856,381      1,500,481
    Depreciation and amortization                                    241,919        159,764
                                                                 -----------    -----------
Entertainment and restaurant costs and expenses                    3,144,779      2,551,996
                                                                 -----------    -----------
Entertainment and restaurant operating income                        847,981        601,356
General and administrative expenses                                  505,898        166,701
Goodwill amortization                                                 54,687         54,687
                                                                 -----------    -----------
Income from operations                                               287,396        379,968

Other income (expense):
    Other income, principally interest                                  --            9,680
    Interest expense                                                (216,390)      (142,117)
                                                                 -----------    -----------
Income before income taxes                                            71,006        247,531
Provision for income taxes                                            26,627         92,824
                                                                 -----------    -----------
Net income                                                       $    44,379    $   154,707
                                                                 ===========    ===========

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

                             See accompanying notes.
                                      - 3 -
<PAGE>
                      TOTAL ENTERTAINMENT RESTAURANT CORP.
                        CONSOLIDATED STATEMENTS OF INCOME
                                   (UNAUDITED)


<TABLE>
<CAPTION>
                                                                     Historical
                                                                  ----------------   
                                                                  For the 18 weeks                    Company Pro Forma
                                                                                         -------------------------------------------
                                                                  and 5 days ended
                                                                    June 17, 1997                For the twenty-four weeks ended
                                                                                         -------------------------------------------
                                                                  (since inception)        June 17, 1997             June 11, 1996
                                                                  -----------------      ----------------          -----------------

<S>                                                                 <C>                 <C>                 <C>
Net sales:
    Food and beverage                                               $ 4,686,637              $ 6,658,564              $ 5,284,139
    Entertainment and other                                             996,496                1,419,027                1,105,966
                                                                    -----------              -----------              -----------
         Total net sales                                              5,683,133                8,077,591                6,390,105
Costs and expenses:
    Costs of sales                                                    1,475,465                2,130,176                1,790,549
    Restaurant operating expenses                                     2,583,166                3,656,520                2,946,658
    Depreciation and amortization                                       336,020                  464,588                  343,385
                                                                    -----------              -----------              -----------
Restaurant costs and expenses                                         4,394,651                6,251,284                5,080,592
                                                                    -----------              -----------              -----------
Restaurant operating income                                           1,288,482                1,826,307                1,309,513
General and administrative expenses                                     694,885                  934,960                  300,477
Goodwill amortization                                                    76,171                  108,460                  109,374
                                                                    -----------              -----------              -----------
Income from operations                                                  517,426                  782,887                  899,662

Other income (expense):
    Other income, principally interest                                       85                      148                   13,676
    Interest expense                                                   (303,390)                (407,257)                (279,426)
                                                                    -----------              -----------              -----------
Income before income taxes and minority interest                        214,121                  375,778                  633,912
Provision for income taxes                                               80,295                  140,917                  237,717
                                                                    -----------              -----------              -----------
Net income                                                          $   133,826              $   234,861              $   396,195
                                                                    ===========              ===========              ===========

Net income per share                                                $      0.02              $      0.03              $      0.05
                                                                    ===========              ===========              ===========
Average shares outstanding                                            8,000,000                8,000,000                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)

<TABLE>
<CAPTION>
                                                                                                          For the 18 weeks
                                                                                                          and 5 days ended
                                                                                                          June 17, 1997
                                                                                                          (since inception)
                                                                                                          -----------------
<S>                                                                                                      <C>         
Cash flows from operating activities:
   Net income                                                                                            $    133,826
   Adjustments to reconcile net income to net cash
     provided by operating activities:
        Depreciation  and  amortization                                                                       430,609
        Net change in operating assets
        and liabilities:
          Change in operating assets                                                                         (179,426)
          Change in operating liabilities                                                                     313,146
                                                                                                         ------------
            Net cash provided by operating activities                                                         698,155

Cash flows from investing activities:
   Purchases of property and equipment                                                                       (503,120)
   Cash of companies acquired in Exchange                                                                     733,804
                                                                                                         ------------
            Net cash provided by investing activities                                                         230,684

Cash flows from financing activities:
   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)
                                                                                                         ------------
            Net cash provided by financing activities                                                          30,359
                                                                                                         ------------

            Net increase in cash and cash equivalents                                                         959,198

Cash and cash equivalents at beginning of period                                                                1,000
                                                                                                         ------------
Cash and cash equivalents at end of period                                                               $    960,198
                                                                                                         ============

Supplemental disclosure of cash flow information:
   Cash paid for interest                                                                                $    290,148
   Cash paid for income taxes                                                                                 109,603

</TABLE>
                             See accompanying notes.
                                      - 5 -


<PAGE>

                      TOTAL ENTERTAINMENT RESTAURANT CORP.

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


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
                                                                    ==========

            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 

                                      -6-

<PAGE>

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 June 11, 1996 and the 24 weeks ended June 17, 1997 and June 11, 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 June 17, 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
of 2,100,000 shares of its Common at $9.00 per share.  Total net proceeds to the
Company of approximately  $16,850,000 are being used for restaurant development,
working  capital  and  general  corporate  purposes.   On  July  23,  1997,  the
underwriters  exercised their  over-allotment  option for an additional  315,000
shares for which the Company received net proceeds of approximately $2,640,000.


3.          STOCK OPTIONS


            -    1997 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 "Initial Public Offering"), 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. There were no such options outstanding as of June 17, 1997.

                                      -7-
<PAGE>


            -    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.  There  were no such  options
outstanding as of June 17, 1997.


                                      -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 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 June 17, 1997,  the Company  operated nine Bailey's and three Fox &
Hounds located in Arkansas,  Indiana, North Carolina, South Carolina,  Tennessee
and Texas.

            The  components of the  Company's net sales are food,  non-alcoholic
beverages, alcoholic beverages, and entertainment and other. For the twenty-four
weeks ended June 17, 1997, food and non-alcoholic  beverages were 24.2% of total
sales, alcoholic beverages were 58.2% 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 and other operating expenses.  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 over 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 restaurant opens.

            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 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 Condensed Consolidated Statement
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            Twenty-four Weeks Ended
                                                                     -----          -----            -----------------------
                                                                    June 17,      June 11,         June 17,           June 11,
                                                                      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 ..................................         26.2             28.3             26.4             28.0
          Restaurant operating expenses ...................         46.5             47.6             45.3             46.1
          Depreciation and amortization ...................          6.1              5.1              5.8              5.4
                                                                --------         --------         --------         --------

             Restaurant costs and expenses ................         78.8             81.0             77.5             79.5
                                                                --------         --------         --------         --------

     Restaurant operating income ..........................         21.2             19.0             22.5             20.5
     General and administrative expenses ..................         12.7              5.3             11.6              4.7
     Goodwill amortization ................................          1.3              1.7              1.3              1.7
                                                                --------         --------         --------         --------

     Income from operations ...............................          7.2             12.0              9.6             14.1
     Other income, principally interest ...................          0.0              0.3              0.0              0.2
     Interest expense .....................................         (5.4)            (4.5)            (5.0)            (4.4)
                                                                --------         --------         --------         --------

     Income before provision for income taxes .............          1.7              7.8              4.6              9.9
     Provision for income taxes ...........................          0.7              2.9              1.7              3.7
                                                                --------         --------         --------         --------

     Net income ...........................................          1.1%             4.9%             2.9%             6.2%
                                                                ========         ========         ========         ========


Restaurant Operating Data:
     Annualized average weekly sales per location (3) .....     $  1,437         $  1,458         $  1,502         $  1,514
     Number of restaurants at end of the period ...........           12                9               12                9
</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 JUNE 17, 1997 COMPARED TO TWELVE WEEKS ENDED JUNE 11, 1996

            Net sales increased $840,000 (26.6%) for the twelve weeks ended June
17, 1997 to $3,993,000  from $3,153,000 in the twelve weeks ended June 11, 1996,
principally  attributable  to  $787,000  in sales  from the three new  locations
opened  since March 1996.  Same store sales  increased  8.2% in the twelve weeks
ended June 17, 1997 compared to the twelve weeks ended June 11, 1996.

            Costs of sales,  primarily  food and beverages,  increased  $155,000
(17.4%) in the twelve weeks ended June 17, 1997 to  $1,046,000  from $892,000 in
the  twelve  weeks  ended  June 11,  1996,  and  such  expenses  decreased  as a
percentage  of sales from  28.3% to 26.2%.  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 June 17,
1997  increased  $356,000  (23.7%) to $1,856,000  from  $1,500,000 in the twelve
weeks ended June 11, 1996,  and such  expenses  decreased as a percentage of net
sales from 47.6% to 46.5%.  Most of this improvement is attributable to improved
labor efficiencies at the locations.

            Depreciation  and  amortization  increased  $82,000  (51.4%) for the
twelve weeks ended June 17, 1997 to $242,000  from  $160,000 in the twelve weeks
ended June 11, 1996,  principally  reflecting  the  amortization  of capitalized
pre-opening  expenses  relating  to the opening of three new  restaurants  since
March 1996 and increases in  depreciation  relating to one owned  property added
since March 1996.

            General and administrative  expenses for the twelve weeks ended June
17, 1997,  increased  $339,000  (203.5%) to $506,000 from $167,000 in the twelve
weeks ended June 11, 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 in the future.

            Interest  expense  for the twelve  weeks  ended June 17,  1997,  was
$216,000,  a $74,000  (52.3%)  increase  from $142,000 in the twelve weeks ended
June 11, 1996. This increase was  attributable to debt incurred to finance three
locations added since December 1995.

            The  effective  income tax rate for the twelve  weeks ended June 17,
1997 and the effective pro forma income tax rate for the twelve weeks ended June
11, 1996 were both 37.5%.

                                      -11-
<PAGE>



                      TOTAL ENTERTAINMENT RESTAURANT CORP.

TWENTY-FOUR  WEEKS ENDED JUNE 17, 1997 COMPARED TO TWENTY-FOUR  WEEKS ENDED JUNE
11, 1996

            Net sales increased  $1,688,000  (26.4%) for the  twenty-four  weeks
ended June 17, 1997 to $8,078,000 from $6,390,000 in the twenty-four weeks ended
June 11, 1996 principally attributable to $1,510,000 in sales from the three new
locations  opened since  December 1995.  Same store sales  increased 8.5% in the
twenty-four  weeks ended June 17, 1997 compared to the  twenty-four  weeks ended
June 11, 1996.

            Costs of sales,  primarily  food and  beverages  increased  $340,000
(19.0%)  in the  twenty-four  weeks  ended  June  17,  1997 to  $2,130,000  from
$1,790,000  in the  twenty-four  weeks ended June 11,  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 twenty-four weeks ended June
17,  1997  increased  $710,000  (24.1%) to  $3,657,000  from  $2,947,000  in the
twenty-four  weeks  ended  June 11,  1996,  and  such  expenses  decreased  as a
percentage  of net  sales  from  46.1% to  45.3%.  Most of this  improvement  is
attributable to improved labor efficiencies at the locations.

            Depreciation  and  amortization  increased  $121,000  (35.3%) in the
twenty-four  weeks  ended  June  17,  1997  to  $464,000  from  $343,000  in the
twenty-four weeks ended June 11, 1996,  principally  reflecting the amortization
of  capitalized  pre-opening  expenses  relating  to the  opening  of three  new
restaurants  since December 1995 and increases in  depreciation  relating to one
owned property added since December 1995.

            General and administrative  expenses for the twenty-four weeks ended
June 17, 1997,  increased  $635,000  (211.2%) to $935,000  from  $300,000 in the
twenty-four  weeks ended June 11, 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 in the future.

            Interest expense for the twenty-four  weeks ended June 17, 1997, was
$407,000,  a $128,000  (45.7%)  increase from $279,000 in the twenty-four  weeks
ended June 11, 1996. This increase was  attributable to debt incurred to finance
three locations added since December 1995.

            The effective  income tax rate for the twenty-four  weeks ended June
17, 1997 and the effective pro forma income tax rate for the  twenty-four  weeks
ended June 11, 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.

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, 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.




                                      -13-


<PAGE>


                      TOTAL ENTERTAINMENT RESTAURANT CORP.


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 has 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.

            At June 17,  1997,  the  Company  had  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.  Such indebtedness was repaid with a portion of the
net proceeds from the Company's Initial Public Offering. 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 (one of which was
opened in March 1997 and two of which are currently under construction),  and is
in active  negotiations for leases on five additional sites. The Company expects
to expend approximately $3.8 million to open new locations through the remainder
of fiscal 1997.

            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,  for which the Company has a commitment but has not yet
entered into a definitive  agreement,  will be sufficient to satisfy 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,  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.


                                      -14-
<PAGE>


                      TOTAL ENTERTAINMENT RESTAURANT CORP.


Part II. - OTHER INFORMATION
----------------------------

Item 4.  Submission of Matters to a Vote of Security Holders.
         ----------------------------------------------------

         In the twelve weeks ended June 17,  1997,  the  following  actions were
taken by written consent of the  stockholders of the Company pursuant to Section
228 of the General Corporation Law of the State of Delaware:

                                               No. of Shares
                                                 Approving        Date of
         Action Taken                           Action Taken     Approval
         ------------                           ------------     --------

1.   Changing Company name to "Total
     Entertainment Restaurant Corp."             7,343,280     June 3, 1997

2.   Approving 1997 Incentive and
     Nonqualified Stock Option Plan              7,198,200     June 3, 1997

3.   Approving Directors Stock
     Option Plan                                 7,290,800     June 3, 1997

4.   Removing Michael A. Nahkunst as
     a Director of the Company                   7,293,920     June 6, 1997

5.   Appointing Gary M. Judd as
     a Director of the Company                   6,894,400     June 11, 1997

         The terms of Jamie B.  Coulter and Dennis L.  Thompson as  Directors of
the Company were unaffected by the actions described in number 4 and 5 above.

         There were  8,000,000  shares of Common  Stock  outstanding  during the
period in which written  consents were delivered to the Company.  Written notice
of the actions described above was sent to all stockholders on June 24, 1997.


                                      -15-
<PAGE>



                      TOTAL ENTERTAINMENT RESTAURANT CORP.



Item 6.  Exhibits and Reports on Form 8-K
                        (a) Exhibit 27................Financial Data Schedule

                        (b) Reports on Form 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 in its behalf by the
undersigned thereunto duly authorized.

                                    Total Entertainment Restaurant Corp.


Date  August 29, 1997               /s/ James K. Zielke
                                    ------------------------------------
                                    James K. Zielke
                                    Chief Financial Officer,
                                    Secretary and Treasurer





                                      -17-