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

                                    FORM 10-Q

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

     For the quarterly period ended May 31, 2000

                                       OR

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

     For the transition period from _______________ to __________________

                        Commission file number: 000-27025

                         SportsPrize Entertainment Inc.
             -------------------------------------------------------
             (Exact name of registrant as specified in its charter)


              Nevada                                       98-0207616
-------------------------------------       ------------------------------------
  (State or other jurisdiction of           (I.R.S. Employer Identification No.)
    incorporation or organization)


                      13101 Washington Boulevard, Suite 131
                          Culver City, California 90066
             -------------------------------------------------------
               (Address of principal executive offices) (Zip Code)

       Registrant's telephone number, including area code: (310) 566-7140

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.

17,585,374 shares of Common Stock, $0.001 par value,  outstanding as of June 30,
2000.


<PAGE>

                         SportsPrize Entertainment Inc.

                                    Form 10-Q

                                      Index

<TABLE>
                                                                                                   Page
                                                                                                   ----
<S>                                                                                               <C>
PART 1 - FINANCIAL INFORMATION.......................................................................1

Item 1.  Financial Statements........................................................................1

         Consolidated Balance Sheets.................................................................2
         Consolidated Statements of Operations.......................................................3
         Consolidated Statements of Cash Flows.......................................................4
         Notes to Consolidated Financial Statements..................................................5

Item 2:  Management's Discussion and Analysis of Financial Condition and Results of Operations.......8

Item 3:  Quantitative and Qualitative Disclosures About Market Risk.................................17


PART II -  OTHER INFORMATION........................................................................18

Item 1.  Legal Proceedings..........................................................................18

Item 2.  Changes in Securities......................................................................18

Item 3.  Defaults Upon Senior Securities............................................................18

Item 4.  Submission of Matters to a Vote of Security Holders........................................18

Item 5. Other Information...........................................................................18

Item 6.  Exhibits and Reports on Form 8-K...........................................................18

SIGNATURES..........................................................................................19
</TABLE>





<PAGE>

                         PART 1 - FINANCIAL INFORMATION

Item 1.  Financial Statements



                         SportsPrize Entertainment Inc.

                           A Development Stage Company

                        CONSOLIDATED FINANCIAL STATEMENTS

                               as of May 31, 2000

                                   (Unaudited)














                                       1
<PAGE>

                         SportsPrize Entertainment Inc.

                           A Development Stage Company

                           CONSOLIDATED BALANCE SHEETS

                                      as of

<TABLE>
                                                                                  May 31, 2000          February 29,
                                                                                   (unaudited)              2000
                                                                                -----------------      ---------------
                                ASSETS
<S>                                                                               <C>                   <C>
Current Assets
          Cash and cash equivalents                                               $      86,786         $    484,906
          Portfolio investment                                                            9,967               10,339
          Prepaid expenses and other current assets                                      69,118               74,844
                                                                                -----------------      ---------------
                                                                                        165,871              570,089
                                                                                -----------------      ---------------
Capital Assets
          Software development costs                                                    393,997              393,997
          Internet equipment                                                            128,358              128,358
          Office computers and equipment                                                 53,994               53,994
          Less: accumulated depreciation and amortization                               (80,723)             (36,041)
                                                                                -----------------      ---------------
                                                                                        495,626              540,308
                                                                                -----------------      ---------------
Other
          Deposits                                                                        8,518                8,527
                                                                                -----------------      ---------------
          Total assets                                                             $    670,015         $  1,118,924
                                                                                =================      ===============

                        LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current Liabilities
          Accounts payable                                                         $    184,323         $     96,857
          Accrued liabilities                                                           657,568              280,084
                                                                                -----------------      ---------------
                                                                                        841,891              376,941
                                                                                -----------------      ---------------
Note payable (Note 7)                                                                   200,000                    -
                                                                                -----------------      ---------------

Stockholders' Equity (Deficit)
          Preferred stock - $0.001 par value
             authorized 5,000,000 shares
             none issued and outstanding                                                      -                    -
          Common stock - $0.001 par value authorized
             100,000,000 shares; 17,585,374 and 19,480,374
              issued and outstanding, respectively (Note 3)                              17,585               19,480
          Additional paid-in capital                                                  9,603,109            8,053,227
          Deferred compensation                                                      (1,732,370)            (590,897)
          Deficit accumulated during the development stage                           (8,260,200)          (6,739,827)
                                                                                -----------------      ---------------
                      Total stockholders' equity (deficit)                             (371,876)             741,983
                                                                                -----------------      ---------------
                                                                                   $    670,015         $  1,118,924
                                                                                =================      ===============
</TABLE>



                                       2
<PAGE>

                         SportsPrize Entertainment Inc.

                           A Development Stage Company

                      CONSOLIDATED STATEMENTS OF OPERATIONS

                              for the periods from


<TABLE>
                                                                Cumulative from            March 1,                March 1,
                                                                 inception to                 to                      to
                                                                 May 31, 2000            May 31, 2000            May 31, 1999
                                                                  (unaudited)             (unaudited)             (unaudited)
                                                              --------------------     ----------------        -----------------
<S>                                                              <C>                    <C>                     <C>
Operating expenses
         General and administrative                              $   8,046,734          $   1,478,655           $   1,863,611
         Research and development                                      126,488                      -                  80,969
         Depreciation and amortization                                  83,564                 44,874                     213
                                                              --------------------     ----------------        -----------------

Loss from operations                                                (8,256,786)            (1,523,529)             (1,944,793)
                                                              --------------------     ----------------        -----------------

Other income (expense)
         Interest income                                                62,578                  2,323                   5,085
         Loss on sale of investments                                   (60,362)                     -                       -
         Other                                                          (5,630)                   833                  (3,167)
                                                              --------------------     ----------------        -----------------
                                                                        (3,414)                 3,156                   1,918
                                                              --------------------     ----------------        -----------------

Net loss for the period                                          $  (8,260,200)         $  (1,520,373)          $  (1,942,875)
                                                              ====================     ================        =================
Basic and diluted loss per share                                                        $       (0.08)          $       (0.17)
                                                                                       ================        =================
Weighted average shares outstanding                                                        18,347,494              11,318,473
                                                                                       ================        =================

</TABLE>






                                       3
<PAGE>

                         SportsPrize Entertainment Inc.

                           A Development Stage Company

                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                              for the periods from


<TABLE>
                                                                Cumulative from            March 1,                March 1,
                                                                 inception to                 to                      to
                                                                 May 31, 2000            May 31, 2000            May 31, 1999
                                                                  (unaudited)             (unaudited)             (unaudited)
                                                              --------------------     ----------------        ----------------
<S>                                                              <C>                    <C>                     <C>
Cash flows from operating activities:
     Net loss                                                    $(8,260,200)            $(1,520,373)            $(1,942,875)
     Adjustments to reconcile net loss to net
        Cash used in operating activities:
        Depreciation and amortization                                 83,564                  44,874                     213
        Loss on sale of investments                                   60,362                       -                       -
        Issuance of common stock for compensation                    212,500                       -                 212,500
        Compensation expense for stock options                     3,897,293                 406,513               1,550,100
        Other                                                        (10,708)                   (833)                  3,167

     Change in operating assets and liabilities:
        Prepaid expenses and other current assets                    (68,144)                  6,740                 (58,231)
        Deposits                                                      (8,518)                      9                  17,000
        Organization costs                                                 -                       -                  13,475
        Accounts payable                                             184,323                  87,466                  (1,235)
        Accrued liabilities                                          657,568                 377,484                       -
                                                              --------------------     ----------------        ----------------
                                                                  (3,251,960)               (598,120)               (205,886)
                                                              --------------------     ----------------        ----------------
Cash flows from investing activities:
     Proceeds from sale of portfolio investments                     231,195                       -                       -
     Purchases of portfolio investments                             (290,207)                      -                       -
     Software development costs                                     (393,997)                      -                       -
     Purchases of equipment                                         (182,352)                      -                  (3,136)
                                                              --------------------     ----------------        ----------------
                                                                    (635,361)                      -                  (3,136)
                                                              --------------------     ----------------        ----------------
Cash flows from financing activities:
     Proceeds from note payable                                      200,000                 200,000                       -
     Proceeds from issuance of common stock                        3,774,107                       -               2,632,537
                                                              --------------------     ----------------        ----------------
Net increase (decrease) in cash and cash equivalents                  86,786                (398,120)              2,423,515
Cash and cash equivalents at beginning of period                           -                 484,906                  34,345
                                                              --------------------     ----------------        ----------------
Cash and cash equivalents at end of period                       $    86,786           $      86,786             $ 2,457,860
                                                              ====================     ================        ================

</TABLE>





                                       4
<PAGE>

                         SportsPrize Entertainment Inc.

                           A Development Stage Company

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                  May 31, 2000


1.   Operations and Going Concern

     The Company commenced its Internet  operations on May 14, 1999. However, it
     has not  yet  earned  any  revenue  therefrom,  and  the  technologies  and
     businesses  that it intends to develop will require cash  significantly  in
     excess of its  current  resources.  The  ability of the  company to develop
     these  technologies  into a  profitable  Internet  business is dependent on
     management's  ability to obtain adequate  additional  capital and develop a
     commercially  successful  product.  Management raised $1,050,000  through a
     private  placement  of 9%  Convertible  Debentures  in June  2000  and will
     continue  to  pursue  the  additional   financing  necessary  to  fund  its
     operations.

2.   Basis of Presentation

     The  information   contained  in  these  condensed  Notes  to  Consolidated
     Financial  Statements  is  condensed  from that which  would  appear in the
     annual consolidated  financial  statements.  Accordingly,  the Consolidated
     Financial Statements included herein should be reviewed in conjunction with
     the  Consolidated  Financial  Statements  and  the  related  notes  thereto
     contained in the  Company's  2000 Annual  Report on Form 10-K. It should be
     understood  that the accounting  measurements  at interim dates  inherently
     involve  greater  reliance on  estimates  than at  yearend.  The results of
     operations  for the fiscal  quarter ended May 31, 2000 are not  necessarily
     indicative of the results that may be expected for the entire year.

     The  accompanying  Consolidated  Balance Sheet of the Company as of May 31,
     2000, and the  Consolidated  Statements of Operations and of Cash Flows for
     the  three-month  periods  ended May 31, 2000 and 1999 are  unaudited.  The
     Consolidated  Financial  Statements and related notes have been prepared in
     accordance  with generally  accepted  accounting  principles  applicable to
     interim periods. In the opinion of management,  the Consolidated  Financial
     Statements   include  all  adjustments,   consisting  of  normal  recurring
     adjustments,   necessary  for  a  fair  presentation  of  the  consolidated
     financial  position,  operating  results  and cash  flows  for the  periods
     presented.

     The financial statements include the accounts of the Company and its wholly
     owned subsidiary.  All significant  intercompany  balances and transactions
     have been eliminated.




                                       5
<PAGE>

                         SportsPrize Entertainment Inc.

                           A Development Stage Company

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- CONTINUED

                                  May 31, 2000


3.   Common Stock

     On April  7,  2000,  pursuant  to  pre-existing  agreements  among  certain
     principal shareholders of the Company, 1,895,000 shares were contributed to
     the Company, which reduced the Company's total outstanding common shares to
     17,585,374.

4.   Stock Options and Warrants

     During the fiscal quarter ended May 31, 2000, the Company  granted  options
     to purchase  1,395,000 shares of the Company's common stock to its Chairman
     and Chief Executive  Officer as well as certain  employees and consultants.
     These options were granted at prices ranging from $0.01 - $1.00,  resulting
     in compensation of $1,547,947, which will be amortized over service periods
     of up to two years.

5.   Loss Per Share

     Basic loss per share is computed  using the  weighted  effect of all common
     shares  issued  and  outstanding.   The  following  table  sets  forth  the
     computation  of basic and diluted  earnings per share.  Options to purchase
     5,033,000  shares of common  stock  ranging from $0.01 - $2.53 a share were
     outstanding  at May  31,  2000.  Such  options  were  not  included  in the
     computation of diluted earnings per share because they were antidilutive.

<TABLE>
                                                                  Three months                   Three months
                                                                     Ended                           Ended
                                                                  May 31, 2000                    May 31, 1999
                                                               ------------------             ------------------
        <S>                                                     <C>                              <C>
         Net loss:                                                ($1,520,373)                     ($1,942,875)
                                                               ==================             ==================
         Denominator:
            For basic and diluted                                  18,374,494                       11,318,473
            loss per share - weighted
            average shares outstanding
         Basic and diluted loss per common share                       ($0.08)                          ($0.17)
</TABLE>



                                       6
<PAGE>

                         SportsPrize Entertainment Inc.

                           A Development Stage Company

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- CONTINUED

                                  May 31, 2000



6.   Commitments and Contingencies

     Employment and Consulting Agreements

     The Company  entered into an employment  agreement with its Chairman of the
     Board and Chief Executive  Officer ("CEO") effective on April 17, 2000. The
     term of the  agreement  is for 24 months and  provides  for an annual  base
     salary of $250,000. Pursuant to this agreement, the CEO was granted options
     to purchase  1,000,000 of the  Company's  common shares at a price of $0.01
     per share. Each month,  40,000 of these options vest throughout the term of
     the agreement.

7.   Subsequent Event

     In June 2000, the Company  completed a private  placement of 9% Convertible
     Debentures for $1,050,000,  less a finders fee of $100,000.  The Debentures
     and accrued  interest were due in May 2005.  Additionally,  60,000 warrants
     were granted in connection with this financing. On May 9, 2000, the Company
     received a cash advance of $200,000 associated with the Debentures. On June
     6, 2000, the Company received the remaining $750,000.

     In July 2000,  the  Company  agreed to convert all of the  Debentures  plus
     accrued  interest at a price of $1.00 per share.  Once the  transaction  is
     completed,  the Company's total outstanding  shares of common stock will be
     18,643,249.




                                       7
<PAGE>

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

     Note Regarding Forward Looking Statements

     Except for  statements  of  historical  fact,  certain  statements  in this
Quarterly Report on Form 10-Q constitute  "forward-looking  statements"  covered
within the meaning of Section 21E of the  Securities  Exchange  Act of 1934,  as
amended,  including,   without  limitation,   statements  containing  the  words
"believes,"  "anticipates," "intends," "expects" and words of similar import, as
well as projections of future results.  Such forward-looking  statements involve
known and unknown  risks,  uncertainties  and other  factors which may cause the
actual results or achievements of the Registrant to be materially different from
any future results or  achievements  of the  Registrant  expressed or implied by
such forward-looking  statements.  Such factors include, but are not limited to,
the following: the Registrant's limited operating history;  undercapitalization;
risks involving new product  development;  unpredictability  of future revenues;
management  of growth and  integration;  potential  technological  changes;  the
Registrant's  dependence on key  personnel;  marketing  relationships  and third
party suppliers; reliance on advertisers;  potential new businesses, competition
and  low  barriers  to  entry;  uncertain  acceptance  of  the  Internet  as  an
advertising  medium;   uncertain  acceptance  of  the  Registrant's  SportsPrize
Tournament;  limited experience in sales, marketing and advertising;  dependence
on continued growth in use of the Internet;  the Registrant's ability to protect
its   intellectual   property  rights  and  uncertainty   regarding   infringing
intellectual   property  rights  of  others;   potential  capacity  and  systems
disruptions;  liability for Internet content;  government regulations;  security
risks;  and the other risks and  uncertainties  described under  "Description of
Business - Risk Factors" in the Registrant's Annual Report on Form 10-K filed on
June 13, 2000. We undertake no obligation to publicly release the results of any
revision to these forward-looking  statements that may be made to reflect events
or  circumstances  after  the  date  hereof  or to  reflect  the  occurrence  of
unanticipated events.

     The Registrant's  management has included projections and estimates in this
Quarterly  Report,  which are based primarily on management's  experience in the
industry, assessments of the Registrant's results of operations, discussions and
negotiations  with  third  parties  and a  review  of  information  filed by its
competitors with the Securities and Exchange Commission. Investors are cautioned
against attributing undue certainty to management's projections.

     General Overview

     We,  SportsPrize  Entertainment  Inc.,  are  engaged  in  the  business  of
offering,   marketing  and  promoting  sports-related  content,   entertainment,
merchandise  and  other  products  on the  Internet  through  our  Web  site  at
http://www.sportsprize.com.

     Our mission is to establish a leading Internet sports-based  entertainment,
merchandising  and community  destination Web site. We intend to build an online
sports,  entertainment and e-commerce community that appeals to sports fans from
around the world by providing three




                                       8
<PAGE>

primary  components  on our Web  site:  (i)  sports-related  content,  (ii)  the
SportsPrize Tournament and (iii) sports-oriented e-commerce.

     Content: We plan to offer the following sports-related content:

     o    Sporting news feeds;

     o    Sports trivia;

     o    Articles and sports commentary;

     o    Interviews with players, coaches and sports commentators;

     o    Player and team profiles;

     o    Team schedules and information;

     o    Ticket and sporting events information, and

     o    Chat rooms and message boards.

     The SportsPrize  Tournament:  We have developed a proprietary,  interactive
game  called  the  "SportsPrize   Tournament,"  which  offers  participants  the
opportunity  to  compete  in  a   multi-sport,   predictive   tournament   where
participants answer weekly questions and accumulate points to win a wide variety
of prizes, as well as discounts on merchandise within our SportsPrize e-shopping
venues.

     We expect that our SportsPrize  Tournament will be the  center-piece of the
SportsPrize.com(TM)   Web  site.  The  SportsPrize  Tournament  is  designed  to
integrate the  excitement of  sports-related  content and  information  with the
communication  and  marketing   capabilities  of  the  Internet.  We  offer  our
SportsPrize  Tournament  as free  entertainment  to visitors on our Web site who
become Registered Members on the site.

     E-Commerce:  Visitors  to our Web site have the  opportunity  to purchase a
broad range of sports-related merchandise in our SportsPrize stores.

     Based  on  our   research,   we  believe  that  there  are  not  any  other
sports-oriented   Web  sites  that  currently   provide  all  three   components
(sports-related content, a multi-sport predictive tournament and sports-oriented
e-commerce),  integrated  into one  comprehensive  Web site. We believe that our
unique, multi-faceted Web site will become a destination for many sports fans on
the Internet.  Our goal is to  differentiate  our Web site from our competitors'
Web sites through an aggressive marketing strategy.

     We intend to generate revenue by:

     o    Selling advertising and sponsorships on our Web site;

     o    Selling  merchandise   through  our  virtual  SportsPrize   e-commerce
          shopping venues;




                                       9
<PAGE>

     o    Licensing  our  content to other  companies  in the United  States and
          other countries; and

     o    Other marketing programs.

     We are a development stage company,  which means that we are in the process
of developing our business and we have limited revenue from our  operations.  We
have a history of losses, and as of May 31, 2000, we had an accumulated  deficit
of $8,260,200, including $4,109,793 in non-cash compensation expenses related to
the issuance of stock and granting of stock options to certain of our directors,
employees and consultants. We incurred losses during the following periods:

     o    $144,125 for the period from March 6, 1998 (inception) to February 28,
          1999;

     o    $6,595,702  for the fiscal year ended  February  29,  2000,  including
          $3,703,280 in non-cash  compensation  expenses related to the issuance
          of stock and  granting of stock  options to certain of our  directors,
          employees and consultants; and

     o    $1,520,373 for the first fiscal quarter ended May 31, 2000,  including
          $406,513 in non-cash  compensation expenses related to the issuance of
          stock and  granting  of stock  options to  certain  of our  directors,
          employees and consultants.

     We  anticipate  that we will continue to incur  substantial  losses for the
foreseeable  future. Thus far, we have raised  approximately  $4,700,000 through
private  placements  to  finance  our  business.  We also are in the  process of
seeking  additional  financing.   We  are  attempting  to  raise  an  additional
$8,000,000 to fund our current plan of operation  through our fiscal year ending
February 28, 2001. See "Note Regarding Forward Looking  Statements" and "Plan of
Operation."  We cannot  assure you that we will obtain  additional  financing to
implement our business plan on acceptable terms, if at all.

     We  launched  the  public  version of our  SportsPrize.com(TM)  Web site on
December 29,  1999.  Visitors to our  SportsPrize.com(TM)  Web site can play our
SportsPrize.com(TM)  Tournament,  access  sports-related  content  and  purchase
sports-oriented  merchandise.  Since the launch,  we have test marketed the site
and built a total membership of approximately  17,000.  However, we have not had
sufficient  working capital to aggressively  market and promote our Web site. We
cannot guarantee that our Web site will be commercially successful as planned or
that we will earn any revenue or profits from our operations.

     We   currently   have   relationships   with  DBC  Sports  to  provide  our
sports-related content and statistical information, as well as ShopSports.com to
provide  merchandise  and  related  order  fulfillment  services.  We also  have
established  relationships with Boomer Esiason, James Worthy, Michael Buffer and
Steve Hartman,  who serve on our Sports Advisory Board and provide unique sports
content and promote our Web site. We have not yet  finalized our agreement  with
Boomer Esiason,  and anticipate that we will finalize this agreement  during the
second fiscal  quarter of 2000. We are currently in the process of attempting to
establish other  relationships with potential sports marketing groups,  athletes
and content providers to provide  additional content on our Web site, as well as
potential  advertisers and sponsors to purchase  advertising on our Web site. We
cannot assure you that we will successfully maintain our




                                       10
<PAGE>

existing relationships with DBC Sports,  ShopSports.com or members of our Sports
Advisory Board, or that we will enter into any new  relationships  with vendors,
athletes, content providers or advertisers.

     We intend to compete in the highly-competitive  Internet industry.  Many of
our  competitors  have  substantially  greater  financial,  technical  and other
resources than we have. Several  competitors already have established Web sites,
brand names,  strategic  relationships with advertisers and other Web sites, and
user  loyalty,  all of which create a competitive  advantage  over us. We cannot
guarantee  that we will be able  to  compete  effectively  or that we will  ever
generate   sufficient   revenues  from  our  operations  to  make  our  business
commercially viable.

     Our  common  stock is  currently  quoted  on the  National  Association  of
Securities Dealers'  over-the-counter bulletin board and trades under the symbol
"JOCK".

     Selected Financial Data

     The  following  table sets forth  selected  financial  data  regarding  our
consolidated  operating results and financial position of our Company.  The data
has been derived from our  consolidated  financial  statements,  which have been
prepared in accordance  with  accounting  principles  generally  accepted in the
United  States.  The  following  selected  financial  data is  qualified  in its
entirety by, and should be read in conjunction with, the consolidated  financial
statements and notes thereto included elsewhere in this Report.

<TABLE>
                                            Three Months Ended May 31,  Three Months Ended May 31,
                                                    2000                           1999
                                          ----------------------------  --------------------------
                                                       $                            $
                                          ----------------------------  --------------------------
<S>                                          <C>                         <C>
Net Sales                                            -                              -
Gross Profit                                         -                              -
Total Operating Expenses                        1,523,529                       1,944,793
Net Loss                                        1,520,373                       1,942,875
Net Loss per Share                                  (0.08)                          (0.17)



                                                       At                            At
                                                   May 31, 2000              February 29, 2000
                                          ----------------------------  --------------------------
                                                       $                            $
                                          ----------------------------  --------------------------
<S>                                            <C>                         <C>
Working Capital (Deficiency)                     (676,020)                    193,148
Total Assets                                      670,015                   1,118,924
Long-Term Obligations                             200,000                      -
Total Liabilities                               1,041,891                     376,941
Shareholders' Equity (Deficit)                   (371,876)                    741,983
Cash Dividends                                      -                          -
</TABLE>




                                       11
<PAGE>

     Results of Operations

     The  following is a discussion  of our  operations  for the fiscal  quarter
ended May 31,  2000.  This  discussion  should be read in  conjunction  with the
Consolidated  Financial  Statements appearing elsewhere in this Quarterly Report
on Form 10-Q, as well as information presented in our Annual Report on Form 10-K
for our fiscal year ended February 29, 2000.

     Revenue.  During  the  fiscal  quarter  ended  May 31,  2000,  the  Company
commenced the second fiscal year of its Internet business.  We are a development
stage enterprise,  and had no material revenue from operations during the fiscal
quarters  ended May 31, 2000 or May 31, 1999.  We had interest  income of $2,323
during the fiscal  quarter  ended May 31, 2000,  compared to $5,085 for the same
period in 1999.

     Expenses.  During  the  fiscal  quarter  ended May 31,  2000,  the  Company
incurred  general  and  administrative  expenses  of  $1,478,655,   compared  to
$1,863,611 for the fiscal quarter ended May 31, 1999.  During the fiscal quarter
ended  May  31,  2000,  the  most   significant   portion  of  our  general  and
administrative  expenses was for  compensation and consulting costs of $885,017,
of which  $406,513 was  non-cash  compensation  associated  with the issuance of
stock  options to our  directors,  employees and  consultants.  This compared to
compensation  and  consulting  costs  of  $1,825,453,  of which  $1,762,600  was
non-cash  compensation  during the fiscal quarter ended May 31, 1999. We believe
that  compensation  and  consulting  costs will  increase as we hire  additional
personnel in future periods.

     During the fiscal  quarter ended May 31, 2000,  the Company  incurred total
prizing costs of $276,388,  which were zero in the fiscal  quarter ended May 31,
1999.  Additionally,  we incurred  advertising  and promotion costs of $115,030,
which also were zero during the same period in the prior year.

     The other  material  operating  costs  incurred by the  Company  during the
fiscal  quarter ended May 31, 2000 were insurance  costs of $52,629,  which were
zero during the fiscal quarter ended May 31, 1999. We also incurred professional
fees of  $40,481  compared  to  $8,627  during  the same  period  in  1999.  The
professional  fees  incurred  during the fiscal  quarter ended May 31, 2000 were
primarily  attributable  to  preparation  of the Company's SEC filings and other
legal agreements.

     During  the fiscal  quarter  ended May 31,  2000,  we had no  research  and
development expenses, compared to $80,969 during the quarter ended May 31, 1999.
During the fiscal  quarter  ended May 31, 2000, we had  depreciation  expense of
$44,874, compared to $213 during the quarter ended May 31, 1999.

     Losses.  During the fiscal quarter ended May 31, 2000, the Company incurred
a total net loss of $1,520,373 ($0.08 per share),  compared to $1,942,875 ($0.17
per share) during the same period in 1999. These losses are expected to continue
in the foreseeable future.

     Liquidity and Capital Resources

     Since our Share Exchange with  SportsPrize  Inc., we have raised a total of
$4,550,000 less finder's fees of $198,000.




                                       12
<PAGE>

     On May 30, 2000, we agreed to issue two 9% Convertible  Debentures,  one in
the  amount  of  $850,000  to Cutter  Services  Corp.  and one in the  amount of
$200,000 to Strathburn Investments Inc., for total gross proceeds of $1,050,000.
We also agreed to issue a warrant to Cutter Services to acquire 48,000 shares of
our common stock at $1.275 per share and a warrant to Strathburn  Investments to
acquire  12,000  shares of our common  stock at $1.275 per share.  The  warrants
expire on May 30,  2002.  We paid Sonora  Capital a finder's  fee of $100,000 in
connection  with the  financing  transaction.  Cutter  Services  and  Strathburn
Investments are non-U.S.  persons,  and the offer and sale were made outside the
United States in reliance on an exemption from  registration  under Regulation S
of the Securities Act of 1933, as amended.

     In July 2000,  the  Company  and the  Holders of the  Debentures  agreed to
convert all of the  Debentures  into  1,050,000  shares of the Company's  Common
Stock at a price of $1.00 per share. At the time of the conversion, the security
interest in the Company's assets, including our intellectual property, software,
technology and other assets will be terminated.

     On May 9, 2000, we received a cash advance of $200,000  associated with the
Debentures.  On May 31, 2000, we had working capital of  approximately  $73,980,
after  giving  effect to the entire  private  placement of the  Debentures.  Our
current working capital  requirements are  approximately  $300,000 per month. We
believe we have sufficient working capital to fund our operations through August
2000.  We are in the process of seeking  additional  financing  in the amount of
$8,000,000 to fund our plan of operation  through February 28, 2001. We have not
negotiated  any such  financings,  and we cannot  assure you that we will obtain
such financing on acceptable  terms, if at all. Our failure to obtain additional
financing will affect our ability to continue as a going concern.

     Assuming we raise  $8,000,000  of planned  financing  and once we are fully
staffed,  our total monthly capital  requirement  will increase to approximately
$660,000.  Our working capital  requirement related to financing fees and costs,
content  costs,  and  general and  administrative  expenses  is  anticipated  to
increase to approximately  $330,000 per month.  Our working capital  requirement
related to marketing expenses is expected to increase to approximately  $250,000
per month,  provided we are able to obtain sufficient financing to implement our
marketing program. We also anticipate that we will invest approximately  $80,000
per month for capital  expenditures  including Web site  equipment and software,
Web site design and development and office equipment.

     If we cannot raise additional financing,  we anticipate that we will reduce
our  projected  expenditures  related  to our  SportsPrize.com(TM)  Web site and
concentrate  our  resources  on  developing  the  technologies  related  to  our
SportsPrize.com(TM)  Web site and the SportsPrize  Tournament,  and building our
revenue  streams.  We have  the  following  material  financial  obligations  to
software and systems developers,  content providers,  Internet access providers,
investor relations providers, and other vendors:

    Vendor                                    Obligation
    ------                                    ----------
    DBC Sports                             $20,000 per month through June 2002
    Frontier/Global Center                 $4,000 per month
    Focus Partners                         $6,000 per month
    Office Leases                          $12,000 per month
    Big Ballot.com                         $3,000 per month




                                       13
<PAGE>

     In addition to these commitments, we have agreements with our employees and
consultants,  which require us to make monthly payments  totaling  approximately
$100,000  per month.  Our failure to meet these  financial  commitments  and our
future  obligations  may have a  material  adverse  effect on our  business  and
results of operations.

                                Plan of Operation

     Our plan of operation includes several important strategic  initiatives and
is based  on  estimates  of our  senior  management.  A  summary  of our plan of
operation and planned operating budget for our business for the 12 months ending
February 28, 2001 is set forth below.

     Summary of Plan of Operation

     The  following  is a summary of our  corporate  plan of  operation  through
February 28, 2001. For the period ending February 29, 2000, the primary focus of
our  operating  plan was to  develop  and  launch  our Web site  and  build  the
necessary  infrastructure to operate and market the site. We launched the public
version of our Web site on  December  29,  1999.  During our fiscal  year ending
February 28, 2001, we plan to implement a major  marketing  program to build the
SportsPrize  brand  as well as the Web  site  audience.  We also  will  continue
developing and enhancing the Web site during this period. During our fiscal year
ending  February  28,  2001,  we intend to allocate  up to 40% of our  operating
budget  towards  marketing  and  promotion  to  facilitate  the   aforementioned
marketing  program.  Our other primary operating  objectives will be to continue
establishing   strategic   alliances  with  corporate   advertisers,   sponsors,
e-commerce associates,  and other potential content and marketing associates. We
also  intend  to  continue  to  build  the  SportsPrize  community  areas on the
SportsPrize.com(TM)  Web site by increasing  sports  information,  news and chat
room content, and sports celebrity-related content.




                                       14
<PAGE>

     Our major strategic and business  initiatives through February 28, 2001 are
as follows:
--------------------------------------------------------------------------------
1.   Raise sufficient capital to finance our business.
--------------------------------------------------------------------------------
2.   Appoint or Recruit Senior Management:

     i.   Vice President of Content.

     ii.  Vice President of Technology.

     iii. Vice President of Sales.
--------------------------------------------------------------------------------
3.   Continue Development and Refinement of the SportsPrize.com(TM)Web site:

     i.   Refine the Home Page and Graphical User Interface for the site.

     ii.  Expand the Stats/Info component of the Web site.

     iii. Develop a private label E-Shopping component of the Web site.

     iv.  Expand the Community component of the Web site, and

     v.   Develop new content  areas on the site such as trivia and other unique
          sports games and content.
--------------------------------------------------------------------------------
4.   Develop comprehensive Web site monitoring/statistical software.
--------------------------------------------------------------------------------
5.   Corporate Development:

     i.   Recruit  Outside  Directors to increase the Board of Directors to nine
          Directors, including five Outside Directors.

     ii.  Expand the Sports Advisory Board to include  representatives from each
          of the major sports offered on our Web site.
--------------------------------------------------------------------------------
6.   Enter into strategic  relationships and/or  international  ventures for our
     Web site.
--------------------------------------------------------------------------------
7.   Implementation of Sales, Marketing and Business Development Plans:

     i.   Refine the initial sales, marketing and business development plans.

     ii.  Commence the sales process and begin generating revenue.

     iii. Commence the marketing and business development processes to build the
          membership  base, build the brand, and broaden the content offering on
          the Web site

     iv.  Explore opportunities in foreign markets.
--------------------------------------------------------------------------------
8.   Locate and lease a new corporate office in the Los Angeles area.
--------------------------------------------------------------------------------




                                       15
<PAGE>

--------------------------------------------------------------------------------
9.   Shareholder Relations and Investor Relations:
     i.   Update the database of shareholders  and maintain  communication  with
          them.

     ii.  Refine the  brochures  for and  exposure to  prospective  investors to
          broaden our shareholder base and capital structure.
--------------------------------------------------------------------------------

     During our fiscal year ending  February 28, 2001, we intend to  concentrate
our  efforts  on  marketing  our Web site to users,  sponsors  and  advertisers;
soliciting  feedback  on our content and  technology  offerings  from our users,
sponsors and advertisers; selling advertising and sponsorships; increasing sales
of  products  offered  through  our  SportsPrize  e-shopping  venues;   building
additional  strategic  relationships;  developing  new  content  and  technology
offerings; obtaining endorsements from professional athletes, coaches and sports
organizations; and enhancing and improving our Web site.

     We cannot  assure you that we will  successfully  complete all of the items
contemplated  in our plan of operation on a timely basis, if at all. Our ability
to complete our plan of operation will be dependent on a number of factors, some
of which are beyond  our  control,  including  our  ability to raise  additional
financing on acceptable terms, our ability to develop our content and technology
on a timely basis,  our ability to attract  advertisers  and  sponsors,  and the
acceptance of our SportsPrize.com(TM) Web site.

     Summary of Planned Operating Budget

     Our planned  operating budget for the fiscal year ending February 28, 2001,
is estimated to be approximately $8,000,000. See "Note Regarding Forward Looking
Statements." Our projected use of these funds is as follows:

     Operating Expenses:
          Financing Fees and Costs                                 $ 400,000
          Content Costs                                              500,000
          General and Administrative                               3,100,000
          Marketing                                                3,000,000
                                                                 -----------
                   Total Operating Expenses                      $ 7,000,000
                                                                 -----------
     Capital Expenditures:
          Web Site Equipment/Software                            $   150,000
          Web Site Design/Development                                500,000
          Office Equipment/Software                                  150,000
          Other                                                      200,000
                                                                 -----------
                   Total Capital Expenditures                     $1,000,000
                                                                 -----------
          Total Capital Required                                  $8,000,000
                                                                 ===========

     As of May 31, 2000, we had $86,786 in cash and cash equivalents.  Currently
we are expending approximately $300,000 per month. We cannot assure you that our
actual expenditures for during our fiscal year ending February 28, 2001 will not
exceed our  estimated  operating  budget.  We based our  projected  costs on our
results of operations, our current




                                       16
<PAGE>

contractual  commitments,  our discussions and negotiations with potential third
party  service  providers,   public  disclosure  of  our  competitors  of  their
historical costs for similar operations,  our discussions with consultants,  our
planned business activities and our management's experience. See "Note Regarding
Forward  Looking  Statements."  Actual  expenditures  will depend on a number of
factors,  some of which are beyond our control,  including,  but not limited to,
timing of changes to our SportsPrize  Web site, our ability to generate  revenue
from  advertising,  sponsorships,  e-commerce  sales and our auction  site;  the
availability of financing on acceptable terms; reliability of the assumptions of
management  in  estimating  costs and  timing;  certain  economic  and  industry
factors;  the time expended by consultants and professionals and fees associated
with  developing  strategic  relationships  related to our  business  plan;  our
ability to enter into strategic relationships with third parties; the success of
our  SportsPrize  Tournament;  and  our  ability  to  attract  visitors  to  our
SportsPrize  Web  site.  You are  cautioned  not to  place  undue  certainty  in
management's  assessments and projections.  If the actual  expenditures for such
costs exceed the estimated  costs or if we are incapable of generating  revenues
from our  operations,  we will be required to raise  additional  financing or to
defer certain expenditures.

     We are  attempting  to raise an  additional  $8,000,000 to fund our current
plan of operation  for fiscal year ending  February 28, 2001. We intend to raise
additional  financing  to fund our  operating  budget by issuing  equity or debt
through a  combination  of private and public  financings.  We cannot assure you
that we will successfully raise additional  financing on acceptable terms, if at
all. If we cannot raise additional financing,  we anticipate that we will reduce
our projected expenditures related to marketing the SportsPrize.com(TM) Web site
and concentrate our resources on developing the SportsPrize.com(TM) Web site and
the SportsPrize  Tournament,  and building our revenue  streams.  The failure to
meet certain  expenditures  may cause us to default on material  obligations and
such default may have a material  adverse  effect on our business and results of
operations.

Item 3:  Quantitative and Qualitative Disclosures About Market Risk

     Our financial  results are quantified in U.S.  dollars and our  obligations
and expenditures for our operations are incurred in U.S. dollars. In the future,
a portion of our revenues may be derived from  business  operations  outside the
United States, which may subject our business to foreign currency  fluctuations.
We do not, however,  believe that we will have any materially significant market
risks relating to revenues from our  operations  derived from outside the United
States or other  business  arrangements  denominated  in currency other than the
U.S. dollar.  Although  variations in the exchange rate may give rise to foreign
exchange gains or losses that may be significant,  we do not anticipate material
foreign exchange gains or losses.

     We currently have no material  long-term debt  obligations,  other than the
convertible  debentures  described  in  this  Report.  We do not  use  financial
instruments for trading purposes and we are not a party to any  derivatives.  In
the event we  experience  substantial  growth in the future,  our  business  and
results of operations  may be materially  affected by changes in interest  rates
and other credit risks associated with our operations.




                                       17
<PAGE>


                           PART II - OTHER INFORMATION

Item 1.  Legal Proceedings.

     To the best of our  knowledge,  we are not subject to any active or pending
legal proceedings or claims against us or any of our properties.  However,  from
time  to  time,  we may  become  subject  to  claims  and  litigation  generally
associated with any business venture.

Item 2.  Changes in Securities.

     None.

Item 3.  Defaults Upon Senior Securities.

     None.

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

     No matters were submitted to a vote of security holders during the
quarter covered by this Report.

Item 5.   Other Information.

     None.

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

(a)      Exhibits

         27.1  Financial Data Schedule.

(b)      Reports on Form 8-K



                                       18
<PAGE>


SIGNATURES

Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
Registrant  has duly  caused this  Quarterly  Report on Form 10-Q for the period
ending  May  31,  2000  to be  signed  on its  behalf  by the  undersigned  duly
authorized.

                                         SportsPrize Entertainment Inc.


Date:    July 17, 2000                   /s/ David Kenin
                                         -----------------------------------
                                         David Kenin
                                         Chief Executive Officer

Date:    July 17, 2000                   /s/ Bruce R. Cameron
                                         -----------------------------------
                                         Bruce R. Cameron
                                         President and Chief Financial Officer
















                                       19