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 September 30, 1996

                                      OR

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

     For the transition period from                  to

     Commission file number 0-19602


                                 BAREFOOT INC.
            (Exact name of registrant as specified in its charter)

            Delaware                                     31-1265715
 (State or other jurisdiction of                      (I.R.S. Employer
  incorporation or organization                      Identification No.)


      450 W. Wilson Bridge Road, Suite 160                 43085
    (Address of principal executive offices)             (Zip Code)

       Registrant's telephone number, including area code (614) 846-1800
                                      N/A
             (Former name, former address and former fiscal year,
                         if changed since last report)

     Indicate by check mark whether the  registrant  (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities  Exchange Act of
1934  during the  preceding  12 months (or for such  shorter  period  that the
registrant  was  required to file such  reports),  and (2) has been subject to
such filing requirements for the past 90 days.

                               Yes  X      No_____

The number of shares of registrant's only class of Common Stock outstanding on
October 31, 1996 was 14,519,760


<PAGE>


                                     INDEX

                         PART I. FINANCIAL INFORMATION



                                                                         Page
                                                                          No.

Item 1. Financial Statements:

      Consolidated  Statements of Income - Three month periods
      ended September 30, 1996 and 1995 (unaudited)                        3

      Consolidated  Statements of Income -- Nine month periods
      ended September 30, 1996 and 1995 (unaudited)                        4

      Consolidated Balance Sheets -- September 30, 1996 and 1995
      (unaudited) and December 31, 1995                                    5

      Consolidated Statements of Cash Flows -- Nine month periods
      ended September 30, 1996 and 1995 (unaudited)                        7

      Consolidated Statement of Shareholders' Equity-
      Interim period ended September 30, 1996 (unaudited)                  9

      Notes to Consolidated Financial Statements (unaudited)              10

Item 2. Management's Discussion and Analysis of Financial Condition
        and Results of Operations                                         11



                          PART II. OTHER INFORMATION

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

Note: Items 1 through 5 of Part II are omitted because they are not applicable.

<PAGE>


PART 1 - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS


                                 BAREFOOT INC.
                       CONSOLIDATED STATEMENTS OF INCOME



                                                       THREE MONTHS ENDED
                                                          SEPTEMBER 30,
                                                     1996              1995
                                                     ----              ----
                                                          (unaudited)

REVENUES:
  Customer service revenues                      $ 36,949,497      $ 35,243,489
  Franchise fees and royalty income                   701,676           709,243
                                                 ------------      ------------
     Total revenues                                37,651,173        35,952,732
                                                 ------------      ------------

COSTS AND EXPENSES:
  Costs of services provided                       12,485,062        11,595,958
  General and administrative                        7,098,351         6,902,949
  Marketing                                         4,659,454         4,337,199
  Amortization of intangibles                         558,308           562,644
                                                 ------------      ------------
     Total costs and expenses                      24,801,175        23,398,750
                                                 ------------      ------------

INCOME BEFORE INTEREST AND
INCOME TAXES                                       12,849,998        12,553,982

  Interest expense                                   (268,897)         (252,752)
  Interest income                                      82,033           161,101
                                                 ------------      ------------

INCOME BEFORE INCOME TAXES                         12,663,134        12,462,331

  Income tax expense                                4,535,000         4,859,000
                                                 ------------      ------------

NET INCOME                                       $  8,128,134      $  7,603,331
                                                 ------------      ------------

EARNINGS PER COMMON SHARE                        $        .56      $        .50
                                                 ------------      ------------

WEIGHTED AVERAGE COMMON SHARES
OUTSTANDING                                        14,530,000        15,309,000
                                                 ------------      ------------
<PAGE>



                                 BAREFOOT INC.
                       CONSOLIDATED STATEMENTS OF INCOME



                                                       NINE MONTHS ENDED
                                                          SEPTEMBER 30,
                                                     1996              1995
                                                     ----              ----
                                                          (unaudited)

REVENUES:
  Customer service revenues                      $ 81,912,338      $ 80,033,056
  Franchise fees and royalty income                 1,514,645         1,466,955
                                                 ------------      ------------
     Total revenues                                83,426,983        81,500,011
                                                 ------------      ------------

COSTS AND EXPENSES:
  Costs of services provided                       32,109,206        30,023,695
  General and administrative                       20,645,490        20,144,156
  Marketing                                         9,658,909         8,941,700
  Amortization of intangibles                       1,630,007         1,664,558
                                                 ------------      ------------
     Total costs and expenses                      64,043,612        60,774,109
                                                 ------------      ------------

INCOME BEFORE INTEREST AND
INCOME TAXES                                       19,383,371        20,725,902

  Interest expense                                   (825,510)         (806,586)
  Interest income                                     274,309           600,238
                                                 ------------      ------------

INCOME BEFORE INCOME TAXES                         18,832,170        20,519,554

  Income tax expense                                6,636,000         8,039,600
                                                 ------------      ------------

NET INCOME                                       $ 12,196,170      $ 12,479,954
                                                 ------------      ------------

EARNINGS PER COMMON SHARE                        $        .83      $        .79
                                                 ------------      ------------

WEIGHTED AVERAGE COMMON SHARES
OUTSTANDING                                        14,646,000        15,896,000
                                                 ------------      ------------

<PAGE>



                                 BAREFOOT INC.
                          CONSOLIDATED BALANCE SHEETS



                                                SEPTEMBER 30,       DECEMBER 31,
                                             1996          1995        1995
                                            ------        ------      ------
                                                 (unaudited)
ASSETS

CURRENT ASSETS
Cash and cash equivalents                $ 5,218,304   $ 8,538,281   $10,877,039
Short-term investments                     1,580,624     1,533,884     1,536,333
Receivables--
  Customers, less allowance for
  doubtful accounts of $2,137,000,
  $1,919,000 and $1,516,000
  respectively                            12,508,342    12,299,054     5,371,272
  Franchises                               2,087,153     1,779,972     1,277,715
  Branchises                               1,222,142       815,324       856,680
  Other                                      768,957     1,187,389       864,976
  Refundable income taxes                       --         333,000          --
Supplies                                   1,608,426     1,354,004     1,058,119
Prepaid advertising costs                  4,885,264     6,957,000          --
Prepaid expenses                             855,105     1,051,738     1,861,656
Deferred taxes                                  --       1,196,000     1,157,000
                                         -----------   -----------   -----------
  Total current assets                    30,734,317    37,045,646    24,860,790
                                         -----------   -----------   -----------

PROPERTY AND EQUIPMENT, net of
  accumulated depreciation and
  amortization of $19,741,000,
  $15,681,900 and $16,684,000
  respectively                            13,164,200    11,793,990    10,977,754

OTHER ASSETS
Intangible assets, net of
  accumulated amortization
  of $9,244,300, $7,429,000,
  and $8,002,000, respectively            31,909,152    27,996,419    27,500,732
Deferred tax assets                        2,954,000          --       1,361,000
Other receivables                          1,524,684     1,552,629     1,221,096
Deposits                                     334,415       299,735       306,967
                                         -----------   -----------   -----------
  Total other assets                      36,722,251    29,848,783    30,389,795
                                         -----------   -----------   -----------
  Total assets                           $80,620,768   $78,688,419   $66,228,339
                                         -----------   -----------   -----------

(Continued on next page)


<PAGE>


                                BAREFOOT INC.
                         CONSOLIDATED BALANCE SHEETS



                                            SEPTEMBER 30,           DECEMBER 31,
                                         1996           1995            1995
                                        ------         ------          ------
                                             (unaudited)

LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES
Current portion, long-term debt    $  1,050,000    $  1,060,000    $    950,000
Current portion, capital lease
   obligations                        3,114,306       3,535,663       3,084,777
Customer prepayments                  3,854,874       4,157,572       4,089,776
Accrued taxes payable                 6,397,760       5,545,000       5,739,500
Accounts payable                      4,383,860       4,656,107       2,674,143
Accrued compensation and
  payroll taxes                       2,054,996       1,917,782       1,602,500
Other accrued expenses                2,089,747       1,195,062         723,024
Deferred taxes                        2,106,000            --              --
                                   ------------    ------------    ------------
   Total current liabilities         25,051,543      22,067,186      18,863,720
                                   ------------    ------------    ------------

DEFERRED TAXES                             --         1,877,500            --

CAPITAL LEASE OBLIGATIONS             8,603,335       6,673,205       6,319,410

LONG-TERM DEBT                        1,736,619       2,204,516       1,900,000
                                   ------------    ------------    ------------

   Total liabilities                 35,391,497      32,822,407      27,083,130
                                   ------------    ------------    ------------

SHAREHOLDERS' EQUITY
Preferred Stock - 5,000,000
   shares authorized,
   $.01 par value                          --              --              --
Series A Junior Participating
   Preferred Stock, 400,000
   shares authorized, per value
   $.01 per share                          --              --              --
Common Stock - 40,000,000 shares
   authorized, $.01 par value,
   shares issued - 16,796,760
   16,771,760 and 16,776,260
   respectively; shares out-
   standing - 14,519,760,
   15,187,760 and 14,855,260,
   respectively                         167,968         167,717         167,763
Additional paid-in capital           50,040,069      49,876,100      49,892,555
Treasury stock, at cost             (26,868,009)    (18,972,000)    (22,801,634)
Excess purchase price                (5,285,649)     (5,285,649)     (5,285,649)
Retained earnings                    27,174,892      20,079,844      17,172,174
                                   ------------    ------------    ------------
   Total shareholders' equity        45,229,271      45,866,012      39,145,209
   Total liabilities and share-    ------------    ------------    ------------
   holders' equity                 $ 80,620,768    $ 78,688,419    $ 66,228,339
                                   ------------    ------------    ------------

<PAGE>



                                 BAREFOOT INC.
                     CONSOLIDATED STATEMENTS OF CASH FLOWS


                                                          NINE  MONTHS ENDED
                                                            SEPTEMBER 30,
                                                       1996             1995
                                                      ------           ------
                                                            (unaudited)
CASH FLOW FROM OPERATING ACTIVITIES:

Net income                                        $ 12,196,170     $ 12,479,954
Adjustments to reconcile net income
   to net cash used in operating
   activities--
    Deferred tax provision                           2,602,495          502,000
    Depreciation and amortization                    4,689,192        4,402,532
    Provision for uncollected
      customer receivables                           1,231,657        1,164,733
    Notes receivable collected                         223,455          176,093
    Franchise fees                                    (150,000)        (211,000)
    Changes in certain assets and
      liabilities--
      (Increase) decrease in assets -
        Investments                                    (44,291)       8,262,684
        Receivables                                 (9,795,269)     (13,180,925)
        Supplies                                      (475,476)        (290,397)
        Prepaid expenses                            (3,878,713)      (4,830,054)
        Other assets                                   (27,448)         (47,431)
        Refundable income taxes                           --          1,500,000
    Increase (decrease) in liabilities-
        Customer prepayments                        (1,086,975)        (487,463)
        Accounts payable                             1,709,717          119,468
        Accrued taxes payable                          658,260        4,065,994
        Accrued expenses                             1,597,769        1,941,998
                                                  ------------     ------------
           Net cash provided by operating
             activities                              9,450,543       15,568,186
                                                  ------------     ------------


(Continued on next page)

<PAGE>


                                 BAREFOOT INC.
                     CONSOLIDATED STATEMENTS OF CASH FLOWS


                                                          NINE  MONTHS ENDED
                                                            SEPTEMBER 30,
                                                       1996             1995
                                                      ------           ------
                                                            (unaudited)
CASH FLOW FROM INVESTING ACTIVITIES:

Cash paid for acquired assets,
  net of cash obtained                            $ (5,261,510)    $   (630,769)
Proceeds from investment in
  direct financing leases and
  notes receivable                                     343,907          215,065
Capital expenditures                                  (661,519)        (578,015)
                                                  ------------     ------------
        Net cash  used in investing
          activities                                (5,579,122)        (993,719)
                                                  ------------     ------------

CASH FLOW FROM FINANCING ACTIVITIES:

Dividends paid                                      (2,193,452)      (1,719,406)
Treasury stock purchased                            (4,066,375)     (18,972,000)
Stock option exercises                                 147,719           28,011
Term loan debt payments                               (630,699)        (692,151)
Capital lease principal payments                    (2,787,349)      (2,637,665)
                                                  ------------     ------------

        Net cash used in financing
          activities                                (9,530,156)     (23,993,211)
                                                  ------------     ------------

        Net  decrease in cash                       (5,658,735)      (9,418,744)
                                                  ------------     ------------

CASH AND CASH EQUIVALENTS, beginning
  of period                                         10,877,039       17,957,025
                                                  ------------     ------------

CASH AND CASH EQUIVALENTS, end of period          $  5,218,304     $  8,538,281
                                                  ------------     ------------

Supplemental disclosure of cash flows
information:

  Interest paid during the period                 $    826,000     $    807,000

  Taxes paid during the period                    $  3,376,000     $  5,163,000



<PAGE>

<TABLE>

                                 BAREFOOT INC.
                CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
                 FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1996
                                  (unaudited)




                        DECEMBER 31,    OPTIONS        SHARES        DIVIDENDS        NET        SEPT 30,
                           1995        EXERCISED    REPURCHASED        PAID          INCOME        1996

<S>                    <C>             <C>        <C>            <C>            <C>           <C>         
COMMON SHARES
ISSUED                   16,776,260      20,500          --             --             --       16,796,760
                       ------------    --------   -----------    -----------    -----------   ------------

TREASURY SHARES           1,921,000        --         356,000           --             --        2,277,000
                       ------------    --------   -----------    -----------    -----------   ------------

PREFERRED STOCK        $       --      $   --     $      --      $      --      $      --     $       --

JUNIOR PARTICIPATING
PREFERRED                      --          --            --             --             --             --

COMMON STOCK                167,763         205          --             --             --          167,968

ADDITIONAL PAID-IN
CAPITAL                  49,892,555     147,514          --             --             --       50,040,069

TREASURY STOCK          (22,801,634)       --      (4,066,375)          --             --      (26,868,009)

EXCESS PURCHASE
PRICE                    (5,285,649)       --            --             --             --       (5,285,649)

RETAINED EARNINGS        17,172,174        --            --       (2,193,452)    12,196,170     27,174,892
                       ------------    --------   -----------    -----------    -----------   ------------

TOTAL SHAREHOLDERS'
EQUITY                 $ 39,145,209    $147,719   $(4,066,375)   $(2,193,452)   $12,196,170   $ 45,229,271
                       ------------    --------   -----------    -----------    -----------   ------------

</TABLE>

<PAGE>



                                 BAREFOOT INC.
              NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS



NOTE 1 - Unaudited Interim Consolidated Financial Statements

     The  accompanying  interim   consolidated   financial  statements  as  of
September  30,  1996  and  September  30,  1995  and for the  three-month  and
nine-month  periods  then  ended are  unaudited.  However,  in the  opinion of
management, these interim statements include all adjustments,  consisting only
of normal  recurring  adjustments,  necessary for a fair  presentation  of the
financial position,  results of operations and cash flows of Barefoot Inc. and
subsidiaries ("Barefoot" or the "Company").  These financial statements should
be read in  conjunction  with the audited  financial  statements  contained in
Barefoot's  Transition  Report on Form 10-K for the nine  month  period  ended
December 31, 1995.

Note 2 - Prepaid Advertising Costs

     Barefoot's accounting policy for marketing expenses for interim reporting
purposes is to defer the expenses  when  incurred and expense these costs over
the treating season. The Company's business is highly seasonal and much of the
marketing expenses are incurred in the first quarter when revenues are lowest.
The revenues generated by the customers signed up from the marketing campaigns
occur over the entire season,  generally March through  November.  Accordingly
the related  marketing  costs are expensed  over that same period.  For annual
financial  reporting  purposes the Company has adopted SOP 93-7  "Reporting on
Advertising  Costs" and  expenses  all  marketing  costs  which are not direct
response advertising costs in the year incurred.


<PAGE>



ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

     Barefoot  provides lawn care service  through  periodic  applications  of
fertilizer and as-needed  applications of weed and insect  controls.  Barefoot
also offers its lawn care customers  additional service options including tree
and shrub care,  lawn  aeration,  liming and seeding.  Barefoot also generates
franchise fee and royalty income from its franchise system.

     To assist in understanding  Barefoot's  operating results,  the following
tables  indicates the percentage  relationships of various items of income and
expense included in the Consolidated  Statements of Income for the three-month
and nine-month periods ended September 30, 1996 and 1995, respectively.




                                                           Percentage Increase
                                                                (Decrease)
                                           Percentage of       Three Months
                                         Total Revenue (1)        Ended
                                        Three Months Ended     September 30,
                                           September 30,           1996
                                                                    vs
                                         1996         1995         1995
                                        ------       ------       ------
                                           %            %            %
                                        ------       ------       ------

Customer service revenues                 98.1         98.0         4.8
Franchise fee & royalty income             1.9          2.0        (1.1)
                                         -----        -----     
   Total revenues                        100.0        100.0         4.7
                                         -----        -----     
Costs of services provided                33.8         32.9         7.7
General and administrative                18.9         19.2         2.8
Marketing                                 12.6         12.3         7.4
Amortization of intangibles                1.5          1.6         (.8)
   Total costs and expenses               65.9         65.1         6.0
                                         -----        -----     
   Income before interest and
     income taxes                         34.1         34.9         2.4
                                         -----        -----     
Interest expense                           (.7)         (.7)        6.4
Interest income                             .2           .5       (49.1)
                                         -----        -----     
   Income before income taxes             33.6         34.7         1.6
Income taxes                              12.0         13.5         6.7
                                         -----        -----     
   Net income                             21.6         21.2         6.9
                                         -----        -----     


<PAGE>

                                                           Percentage Increase
                                                                (Decrease)
                                           Percentage of        Nine Months
                                         Total Revenue (1)        Ended
                                         Nine Months Ended     September 30,
                                           September 30,           1996
                                                                    vs
                                         1996         1995         1995
                                        ------       ------       ------
                                           %            %            %
                                        ------       ------       ------

Customer service revenues                 98.2         98.2         2.3
Franchise fee & royalty income             1.8          1.8         3.3
                                         -----        -----     
   Total revenues                        100.0        100.0         2.4
                                         -----        -----     
Costs of services provided                39.2         37.5         6.9
General and administrative                24.8         24.7         2.5
Marketing                                 11.8         11.2         8.0
Amortization of intangibles                2.0          2.0        (2.1)
   Total costs and expenses               76.8         74.6         5.4
                                         -----        -----     
   Income before interest and
     income taxes                         23.2         25.4        (6.5)
                                         -----        -----     
Interest expense                          (1.0)        (1.0)        2.3
Interest income                             .3           .8       (54.3)
                                         -----        -----     
   Income before income taxes             22.5         25.2        (8.2)
Income taxes                               7.9          9.9       (17.5)
                                         -----        -----     
   Net income                             14.6         15.3        (2.3)
                                         -----        -----     


1)   Costs of services  provided  and  marketing  expenses  are  expressed  as
     percentages of customer service revenues.



THREE MONTHS ENDED SEPTEMBER 30, 1996 COMPARED WITH THREE MONTHS ENDED
SEPTEMBER 30, 1995

REVENUES

     Customer  service  revenues  increased 4.8% to $36,950,000  for the three
months ended  September 30, 1996 from  $35,243,000  for the three months ended
September 30, 1995.  Revenues from Hydro Lawn,  which was acquired on July 15,
1996, accounted for over 50% of the increase between years.

     Franchise  fees and royalty  income  declined  1.1% to $702,000 in 1996's
third  quarter from $709,000 in 1995's third  quarter.  The decrease is due to
$61,000 less in initial franchise fees. Royalty income actually increased over
10% between the periods due to growth both in the number of locations open and
service revenues done by the franchisees in the third quarter of 1996.

     Cost of services  provided  increased  7.7% to  $12,485,000  in the three
months ended  September  30, 1996 from  $11,596,000  in the three months ended
September  30, 1995.  Costs of services  increased as  percentage  of customer
service  revenues between years to 33.8% in the third quarter of 1996 compared
to 32.9% in the third quarter of 19995.  Costs of services for Hydro Lawn were
35% of the increase.  Higher  products costs and increased  insecticide  usage
during the 1996 quarter were also factors in the increase between years.


<PAGE>


     General and administrative expenses increased 2.8% and were down slightly
as a percent of total  revenues  at 18.9% in the 1996  period and 19.2% in the
1995 period. The modest decrease in general and  administrative  expenses as a
percentage of revenues reflects  moderation of employment related expenses due
to better employee retention in most Barefoot markets.

     Marketing  expenses were  $4,659,000 for the three months ended September
30, 1996 and  $4,337,000  for the three months ended  September 30, 1995.  For
interim reporting purposes the Company defers the costs of its Spring and Fall
marketing  campaigns and expenses them over the treating  season.  The amounts
expensed in the three month periods ended  September 30, 1996 and 1995 were in
proportion  to the  revenues  recognized  in the  periods  compared  to  total
expected revenues for the seasons.

     Interest  expense  increased  6.4% to $269,000 in the three  months ended
September 30, 1996 from $253,000 in the three months ended  September 30, 1995
due to higher  capital  lease  balances for  additions  to the vehicle  fleet.
Interest  income  declined  49.0% to $82,000 in the third quarter of 1996 from
$161,000 for the same period in 1995 due to lower cash balances  available for
investment in 1996  following the  repurchase  of nearly  2,277,000  shares of
Barefoot Inc. common stock in 1995 and thus far in 1996.

     Income taxes were  provided at an effective 36% rate in the third quarter
of 1996  versus 39% in prior  years.  The lower tax rate will be in effect for
1996 due to changes to the values of tax benefits recorded in prior years.

     Net income rose 6.9% to $8,128,000  for the three months ended  September
30, 1996 from  $7,603,000 for the three months ended September 30, 1995 on the
4.7% increase in revenues and the decrease in the effective tax rate.

     Earnings per share increased to $.56 per share for the three months ended
September  30, 1996 from $.50 per share for the three months  ended  September
30, 1995. The per share earnings were computed on 14,530,000  weighted average
shares  outstanding  in the 1996  quarter and  15,309,000  in 1995.  The lower
number of shares  outstanding  in 1996  reflects the  repurchase  of 2,277,000
shares since April 1, 1995.


NINE MONTHS ENDED SEPTEMBER 30, 1996 COMPARED WITH NINE MONTHS ENDED
SEPTEMBER  30, 1995

REVENUES

     Customer  service  revenues  increased 2.3% to  $81,912,000  for the nine
months ended  September  30, 1996 from  $80,033,000  for the nine months ended
September 30, 1995. Excluding the July, 1996 Hydro Lawn acquisition,  revenues
were  essentially  flat between years which is in line with the lack of growth
in customers from Spring 1995 to Spring 1996.

     Franchise  fees and royalty  income  increased  3.3% to $1,515,000 in the
1996 period from  $1,467,000  in the 1995.  The  increase  reflects  the added
royalties  from  seven new  franchise  locations  opened in 1996 and growth in
customer service revenues generated by the franchisees offset by lower initial
franchise fees in 1996.

EXPENSES

     Costs of services  provided  increased  6.9% to  $32,109,000  in the nine
months  ended  September  30, 1996 from  $30,024,000  in the nine months ended
September  30, 1995.  Costs of services  increased as a percentage of customer

<PAGE>



service  revenues to 39.2% in 1996 compared to 37.5% in 1995.  The increase in
costs of services was primarily from the weather causing lower productivity on
treatments in the first six months of 1996, and the addition of four branchise
locations and the interior  plant  business at the end of the first quarter of
1995. As a result,  year-to-date 1996 operating  expenses were higher from the
acquisitions  in comparison  to 1995.  1996 costs were also affected by higher
product costs.

     General  and  administrative  expenses  increased  2.5%  and were up only
slightly to 24.8% of total revenues in the 1996 period from 24.7% in the prior
year period.  Reductions in  employment  related taxes and fringes in the 1996
period were primarily  responsible  for offsetting  increases from the greater
number of locations open in 1996 following the acquisitions on March 31, 1995.

     Marketing  expenses were  $9,659,000 for the nine months ended  September
30, 1996 and $8,942,000 for the nine months ended  September 30, 1995, an 8.0%
increase.  For interim reporting  purposes the Company defers the costs of its
marketing  campaigns and expenses them over the treating  season.  The amounts
expensed in the nine month periods  ended  September 30, 1996 and 1995 were in
proportion  to the  revenues  recognized  in the  periods  compared  to  total
expected  revenues for the seasons.  Since revenues were flat between periods,
marketing  expenses  incurred  thus far in 1996 are higher  than 1995 due to a
greater number of company  locations in 1996 compared to 1995 due to the March
31, 1995  acquisition  of four branchise  locations,  and higher costs per new
sale generated.

     Interest  expense  increased  2.3% to $826,000  in the nine months  ended
September 30, 1996 from  $807,000 in the nine months ended  September 30, 1995
due to the higher  capital lease  balances for additions to the vehicle fleet.
Interest  income  declined  over 54.0% to $274,000 in the first nine months of
1996 from  $600,000  for the same  period in 1995 due to lower  cash  balances
available for investment in 1996 following the repurchase of 2,277,000  shares
of Barefoot Inc. common stock in 1995 and thus far in 1996.

     Income taxes were provided at an effective  35.2% rate in 1996 versus 39%
in prior  years.  The lower tax rate is due to tax  benefits  recorded  in the
second and third  quarters of 1996. The effective tax rate for the entire 1996
year is expected to be approximately 36%.

     Primarily  as  a  result  of  the  flat  lawn  care  revenues  and  lower
productivity  due to the weather,  net income  declined to  $12,196,000 in the
1996 period from $12,480,000 in the 1995 period, a 2.3% decrease.

     Earnings per share  increased to $.83 per share for the nine months ended
September 30, 1996 from $.79 per share for the nine months ended September 30,
1995.  The per share  earnings were computed on  14,646,000  weighted  average
shares outstanding in the 1996 period and 15,896,000 in 1995. The lower number
of shares  outstanding in 1996 reflects the repurchase of 2,227,000  shares in
1995 and 1996.

QUARTERLY RESULTS

     The following  table sets forth certain  unaudited  operating  results of
each of the eleven  consecutive  quarters in the period  ended  September  30,
1996. This information is unaudited but, in the opinion of management includes
all adjustments  (consisting only of normal recurring  adjustments)  necessary
for a fair  presentation  of the results of operations for such periods.  This
information  should be read in  conjunction  with the  Company's  Consolidated
Financial Statements and the Notes thereto.

<PAGE>
 
                                         First     Second     Third     Fourth
                                        quarter    quarter   quarter    quarter
                                        -------    -------   -------    ------- 
                                        (In thousands, except per share amounts)

Year Ended December 31, 1994
  Total revenues                        $ 6,412    $32,676   $33,961   $ 18,735
  Costs of services provided              4,847     11,279    10,629      7,849
  Net income (loss)                      (2,611)     6,909     8,010      1,658
  Earnings (loss) per share             $  (.16)   $   .41   $   .48   $    .10

Year Ended December 31, 1995
  Total revenues                        $ 9,585    $35,963   $35,953   $ 21,515
  Costs of services provided              6,288     12,140    11,596     10,141
  Net income (loss)                      (2,704)     7,580     7,603     (2,302)
  Earnings (loss) per share             $  (.16)   $   .49   $   .50   $   (.15)

Year Ended December 31, 1996
  Total revenues                        $ 9,581    $36,195   $37,651
  Costs of services provided              7,031     12,593    12,485
  Net income (loss)                      (3,230)     7,298     8,128
  Earnings (loss) per share             $  (.22)   $   .50   $   .56



Note:  Quarterly  per share  results may not total to the annual  earnings per
share due to changes in shares  outstanding  and the exclusion of common stock
equivalents  in the quarterly  periods when losses occur.  All dollar  amounts
except per share amounts are in thousands.

     The Company's results of operations  fluctuate on a quarterly basis, with
the total revenues and net income significantly higher in the Company's second
and third quarters (ending June 30 and September 30, respectively).

     The Company  believes that inflation has not had a material effect on the
results of its operations.


Liquidity and Capital Resources

GENERAL

     Barefoot's lawn care business generates  significant cash flow during the
treating season - generally March through November.  Cash built up during this
period is used to fund  operations  during the seasonally  slow quarter ending

<PAGE>



March 31 which is also when Barefoot incurs  advertising  costs for the Spring
marketing campaign. Barefoot also collects advance payments (prepayments) from
approximately  15% of its customers in December  through April. The prepayment
receipts are  important in financing  operations  during the winter months and
Spring advertising.

     The  seasonality  of  Barefoot's  business  causes  wide  variance in the
accounts which comprise working capital.  In early Spring prepaid expenses and
customer  prepayments  are at their  peaks.  Over the  treating  season  these
balances  decline while  receivables  from customers  build. By the end of the
calendar year these balances reach their seasonal lows.

     Investment in supplies  (fertilizers,  pesticides,  plants,  etc.) is not
material to  Barefoot's  business.  Short lead times for  delivery of products
allow the  Company to  minimize  its  investment  in  supplies to just what is
needed for the next week or two.  This  allows the  Company  to  minimize  its
investment in warehouse space.

CASH FLOWS FROM OPERATIONS

     For  the  nine  months  ended  September  30,  1996  Barefoot   generated
$9,450,000  of cash from  operations.  Cash provided by operations in the nine
months  ended  September  30,  1995  was   $15,568,000.   The  liquidation  of
investments  to  repurchase  shares  added over  $8,262,000  to cash flow from
operations in 1995. The normal seasonal factors  discussed above accounted for
the remainder of the increase in cash flow from operations for both periods.

DEBT, ACQUISITIONS AND CAPITAL EXPENDITURES

     Currently  Barefoot  has  $2,217,000  of term  debt  remaining  from  the
acquisition  of Lawnmark on April 1, 1994. The Lawnmark note bears interest at
the prime rate plus 1% subject to a maximum rate of 9%. Principal  payments on
the note of  $158,333  each are due only  during  the  months of June  through
November. Interest is paid monthly.

     Capital leases,  primarily for lawn service vehicles,  are the only other
significant  long-term  commitment.  Near the end of March 1996  approximately
$4,800,000 was added to capital leases for the vehicles at Company  locations,
franchises and branchises.

     Capital lease payments were $2,787,000 in the nine months ended September
30, 1996 compared to $2,638,000 in the nine months ended September 30, 1995.

     Capital  expenditures,  other than  vehicle  leases,  are not material to
Barefoot's business.

     Barefoot  acquired  a lawn  care  business  in  January,  1996 for a cash
payment  of  $561,000.  In April,  1996  Barefoot  acquired  the assets of its
Richmond,  VA  franchise  for total  consideration  (cash and assumed  current
liabilities) of approximately  $850,000.  In June, 1996 Barefoot  acquired its
Ft. Myers, Florida franchise for debt and assumed liabilities of $112,000.



     Effective  July 12, 1996  Barefoot  acquired  the assets of Hydro Lawn, a
lawn care company with operations in the Washington D.C. and Columbia MD metro
areas.  Total  consideration  for  the  assets  was in  excess  of $5  million
including cash paid, liabilities assumed,  long-term deferred payments and new
capital leases.

     In September,  1995 Barefoot  increased its $6,000,000  Revolving  Credit
Facility to $20,000,000 ("the Facility"). Up to $2,500,000 of the Facility may
be used for letters of credit.  Borrowings under the facility bear interest at
the prime rate or at LIBOR plus 125 basis points.  The line of credit is for a
three-year  period.  At the end of the three  year term,  borrowings  made for
nonseasonal purchases may be converted to a five-year term loan.


<PAGE>



     The Facility  requires approval of acquisitions of businesses for amounts
in excess of $15,000,000  of cash and debt or  $25,000,000 of Barefoot  Common
Stock and  subordinated  debt.  The  Facility's  covenants  also limit  annual
capital expenditures to $7,500,000 and require maintenance of consolidated net
worth  of  at  least  $25,000,000.   Barefoot  believes  compliance  with  the
restrictions  contained in the Facility will not hinder its  operations or its
ability to acquire lawn care  businesses,  to pay  dividends or to  repurchase
shares of its stock.  No amounts,  other than letters of credit for  insurance
contracts,  were  borrowed on the  revolving  line of credit in the current or
prior year periods.

     For a two week  period  following  the Hydro  Lawn  acquisition  Barefoot
borrowed on its line of credit.  Maximum  borrowings  were  $1,850,000  at the
prime rate. All borrowings were repaid prior to July 31, 1996.

INCOME TAXES

     Tax benefits from revaluing  certain deferred tax assets from prior years
will be  recorded  in 1996,  1997 and  1998.  In the  second  quarter  of 1996
deferred tax assets were  increased by $932,000 while net goodwill was reduced
by $932,000. Starting in the second quarter the effective tax rate was reduced
to 36% from  39%.  In 1996,  1997 and  1998  the  Company  estimates  that the
recognition of the  additional  tax benefits will reduce the annual  effective
tax rate to  approximately  36%. The lower tax rate does not affect the actual
taxes payable in 1996 and beyond.

DIVIDENDS AND SHARE REPURCHASES

     On March 15, 1996,  June 14, 1996 and September 16, 1996 the Company paid
$.05 per share  dividends.  On October 23, 1996 Barefoot's  Board of Directors
declared  a  $.05  per  share  dividend   payable  on  December  16,  1996  to
shareholders of record on December 2, 1996.

     Between April and December 1995 the Company repurchased  1,921,000 shares
of its Common  Stock for a total cost of  $22,801,634.  In 1996 an  additional
356,000 shares were repurchased at a cost of $4,066,375.

     The Company is authorized to repurchase up to 723,000  additional  shares
of its  outstanding  Common  Stock.  The Company will continue to evaluate its
cash  position,  borrowing  capacity,  acquisition  opportunities  and  market
valuation  in  determining  if it  will  acquire  any or  all  of  the  shares
authorized.


<PAGE>



PART II OTHER INFORMATION


Item 6.  Exhibits and Reports on Form 8-K

(a)  Reports on Form 8-K

     None

(b)  Exhibits

     11   Computation of Earnings per Common and Common Equivalent Share

     27   Financial Data Schedule


<PAGE>



                                  SIGNATURES

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


                                         BAREFOOT INC.




                                         /s/ Michael R. Goodrich
                                             ----------------------------------
                                             Chief Financial Officer and
                                             Authorized Signing Officer


November 6, 1996


<PAGE>



                                 EXHIBIT INDEX



Exhibit Number          Description                                Page #
--------------        ---------------                             --------


     11          Computation of Earnings per Common and              21
                 Common Equivalent Share

     27          Financial Data Schedule                             22