SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549


                                   FORM 10-QSB

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

                  For the quarterly period ended March 31, 1999

                                       OR

                 [ ]TRANSITION REPORT UNDER SECTION 13 OR 15(d)
                               OF THE EXCHANGE ACT

          For the transition period from ___________ to _______________

                         Commission file number 1-13818

                      THE RATTLESNAKE HOLDING COMPANY, INC.
             (Exact name of registrant as specified in its charter)


          Delaware                                        06-1369616
(State or other jurisdiction of                         (I.R.S. Employer
 incorporation or organization)                       Identification Number)


                  2 South Main Street, So. Norwalk, Conn. 06854
               (Address of principal executive offices) (Zip Code)

        Registrant's telephone number, including area code (860) 276-8660

     Check  whether  the issuer (1) filed all  reports  required  to be filed by
Section 13 or 15 (d) of the  Exchange Act during the past 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 ___ No X

     29,505,066 Common Shares,  par value $.001 per share were outstanding as of
March 31, 1999






<PAGE>




                                   FORM 10-QSB

                      THE RATTLESNAKE HOLDING COMPANY, INC.

                                 March 31, 1999

                                      INDEX

<TABLE>
<CAPTION>

                                                                                                    Page No.
Part I - Financial Information

Item 1: Financial Information

<S>                                                                                                       <C>
Condensed Consolidated Balance Sheets as of March 31, 1999 (Unaudited) and June 28, 1998                  3

Unaudited Condensed Consolidated  Statements of Operations three and nine months
     ended March 31, 1999 and March 29, 1998                                                              4

Unaudited Consolidated Statements of Cash Flows nine months ended March 31, 1999
     and March 29, 1998                                                                                   5

Notes to Unaudited Condensed Consolidated Financial Statements                                            6

Management's Discussion and Analysis                                                                      10

Liquidity                                                                                                 13

Safe Harbor                                                                                               15

Part II - Other Information

Item 1: Legal Proceedings                                                                                 16

Item 2: Changes in securities and Use of Proceeds                                                         17

Item 3: Defaults Upon Senior Securities                                                                   17

Item 4: Submission of Matters                                                                             17

Item 5: Other Information                                                                                 17

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

Signatures                                                                                                19

</TABLE>




<PAGE>



             THE RATTLESNAKE HOLDING COMPANY, INC. AND SUBSIDIARIES
                      Condensed Consolidated Balance Sheets

<TABLE>
<CAPTION>
                                                                                March 31, 1999                     June 28, 1998
                                                                                 (unaudited)
                                                                                -------------                     -------------
         ASSETS
<S>                                                                             <C>                                <C>
Current assets:
      Cash                                                                      $3,660,354                        $311,328
      Accounts receivable                                                           21,843                          16,831
      Notes receivable, current installments                                             -                           4,080
      Inventory                                                                     16,028                          29,397
      Prepaid expenses and other current assets                                      1,000                           7,200
                                                                                ----------                         -------
                   Total current assets                                          3,699,225                         368,836
                                                                                ----------                         -------

Notes receivable, less current
installments                                                                             -                          225,920
Property and equipment, net                                                         80,193                           81,375
Intangible assets, net                                                              22,502                           30,598
Other assets, net                                                                   85,621                           78,443
                                                                                ----------                          -------
                                                                                $3,887,541                         $785,172
                                                                                ==========                          =======

         LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
      Current maturities of notes payable                                       $  252,544                       $1,282,539
      Accounts payable                                                             594,460                        1,019,139
      Accrued expenses                                                             457,314                          629,414
      Dividends payable                                                                  -                          207,636
      Other current liabilities                                                    183,079                          182,971
                                                                                ----------                        ---------
                   Total current liabilities                                     1,487,397                        3,321,699

Notes payable, net of current maturities                                           229,173                          525,006
                                                                                ----------                        ---------
                                                                                 1,716,570                        3,846,705
                                                                                ----------                        ---------

Stockholders' equity:
      Preferred stock,  $.10 par value,  5,000,000  shares  authorized,  200,000
         designated Series A, and 56,500 issued and outstanding at June 28, 1998         -                            5,650
         500,000 designated Series B, 307,104 issued and
         outstanding, at March 31, 1999                                             30,710                                -
      Common stock, $.001 par value, 400,000,000 and 20,000,000
         shares  authorized,  at March 31, 1999 and June 28, 1998  respectively,
         29,505,066 and 10,889,285 issued and outstanding, at March 31, 1999 and
         June 28, 1998 respectively                                                 29,506                           10,890
      Additional paid-in capital                                                20,285,532                       12,554,618
      Accrued dividends                                                                  -                         (207,636)
      Accumulated deficit                                                      (18,174,777)                     (15,425,055)
                                                                                -----------                     ------------
                                                                                 2,170,971                       (3,061,533)
                                                                                -----------                     ------------

                                                                                $3,887,541                      $   785,172
                                                                                ==========                      ============

</TABLE>

See accompanying notes to unaudited condensed consolidated financial statements.


<PAGE>




             THE RATTLESNAKE HOLDING COMPANY, INC. AND SUBSIDIARIES
            Unaudited Condensed Consolidated Statements of Operations

<TABLE>
<CAPTION>



                                                       Three months ended                    Nine months ended
                                                  March 31,             March 29,        March 31,          March 29,
                                                     1998                 1999             1998               1999
                                                -------------        -------------     ------------       -------------
<S>                                             <C>                   <C>              <C>                <C>
Restaurant sales                                $ 322,808             $  857,926       $1,421,073         $2,989,049
Less: promotional sales                            10,548                 41,628           55,664            107,307
                                                ---------             ----------       ----------         ----------
Net restaurant sales                              312,260                816,298        1,365,409          2,881,742

Costs and expenses:
  Cost of food and beverage sales                  98,763                266,849          520,759            932,746
  Restaurant salaries and benefits                112,429                283,145          560,770            949,877
  Occupancy and related expenses                   40,271                186,066          416,747            712,449
  Depreciation and amortization expense            13,893                 91,667           36,175            275,001
                                                ---------              ---------        ---------         ----------
     Total restaurant costs and operating
     expenses                                     265,356                827,727        1,534,451          2,870,073
Selling, general and administrative             1,587,185                 83,205        2,050,405            686,803
Loss on closure of restaurant sites and           365,000                      -          365,000                  -
   impairment charges
Interest expense, net                              65,154                 81,988          196,340            179,335
Litigation award                                        -                      -          225,000                  -
Miscellaneous expenses (income)                    (2,332)                 2,907          ( 1,708)            10,038
                                                ---------              ---------        ---------         ----------
Net loss before extraordinary item             (1,968,103)              (179,529)      (3,004,079)          (864,507)
                                                ---------              ---------        ---------         ----------
Extraordinary item:
Gain on extinguishment of debt                    254,360                      -          343,310                  -
                                                ---------              ---------        ---------         ----------
Net loss                                       (1,713,743)              (179,529)      (2,660,769)          (864,507)

Dividends on preferred shares                           -                (77,863)               -           ( 77,863)
                                                ---------              ---------        ---------         ----------
Net loss available to common shareholders     $(1,713,743)            $ (257,392)     $(2,660,769)        $ (942,370)
                                                =========              =========        =========         ==========

Net loss per share:
Loss before extraordinary item                      (0.09)                 (0.10)           (0.19)             (0.36)
Extraordinary item                                   0.01                      -             0.02                  -
                                                    ------                 ------           ------             ------
   Net loss - Basic and diluted                     (0.08)                 (0.10)           (0.17)             (0.36)
                                                    ======                 ======           ======             ======
Weighted average number of common
   and common equivalent shares
   outstanding - Basic and diluted             21,441,412              2,650,227       15,609,352          2,650,227
                                               ==========              =========       ==========          =========
</TABLE>

See accompanying notes to unaudited condensed consolidated financial statements.


<PAGE>


             THE RATTLESNAKE HOLDING COMPANY, INC. AND SUBSIDIARIES
            Unaudited Condensed Consolidated Statements Of Cash Flows

<TABLE>
<CAPTION>


                                                                                                Nine months ended
                                                                                       March 31,                   March 28,
                                                                                         1999                           1998
                                                                                     ------------                   -------------

<S>                                                                                  <C>                           <C>
Cash flows from operating activities:

  Net loss                                                                           $ (2,660,769)                (864,507)
  Adjustments to reconcile net loss to net cash used in operating activities:

     Depreciation and amortization                                                         36,175                  290,321
     Litigation award                                                                     225,000                  -
     Issuance of common stock for services rendered                                       218,676                  -
     Impairment charge                                                                    365,000                  -
     Stock compensation                                                                   106,077                  -
     Valuation of warrants for services                                                 1,093,873                  -
     Gain on extinguishment of debt                                                      (343,310)                 -
     Changes in assets and liabilities:
          Increase in accounts receivable                                                  (5,012)                 (18,367)
          Decrease in inventory                                                            13,369                      219
          Increase in prepaids and other assets                                              (978)                 (14,989)
          (Decrease) increase accounts payable and accrued expenses                      (322,576)                 453,388
          Increase in other current liabilities                                               108                      489
                                                                                     ------------                  -------
     Net cash used in operating activities                                             (1,274,367                 (153,446)
                                                                                     ------------                  -------
Cash flows from investing activities
   Capital expenditures                                                                   (26,900)                 -
                                                                                     ------------                  -------
     Net cash used in investing activities                                                (26,900)                 -

Cash flows from financing activities:
  Proceeds from issuance of convertible notes                                             150,000                  750,000
  Proceeds from issuance of common stock, net                                             153,500                  -
  Financing costs                                                                         -                       (230,000)
  Proceeds from issuance of Series B preferred stock, net                               4,732,624                  -
   Principal repayments of borrowings                                                    (385,831)                (415,854)
                                                                                        ---------                  -------
   Net cash provided by financing activities                                            4,650,293                  104,146
                                                                                        ---------                  -------
Net increase (decrease) in cash                                                         3,349,026                  (49,300)

Cash, beginning of period                                                                 311,328                   68,022
                                                                                        ---------               ----------
Cash, end of period                                                                     3,660,354               $   18,722
                                                                                        =========               ==========
Cash paid during the period for:
   Interest                                                                               223,202               $    7,599
                                                                                          =======               ==========
   Income taxes                                                                           -                     $    6,891
                                                                                          =======               ==========

</TABLE>

See accompanying notes to unaudited condensed consolidated financial statements.



<PAGE>



             THE RATTLESNAKE HOLDING COMPANY, INC. AND SUBSIDIARIES
         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS



     1. Principles of Consolidation

     The  consolidated   financial   statements  include  the  accounts  of  The
Rattlesnake  Holding  Company,  Inc.  and  subsidiaries  (the  "Company").   All
significant  intercompany  accounts and  transactions  have been  eliminated  in
consolidation.

     2. Consolidated financial statements

     The accompanying  unaudited  consolidated  financial statements as shown in
the index  were  prepared  in  accordance  with  generally  accepted  accounting
principles.  These statements  include all adjustments  which, in the opinion of
management are necessary to present fairly the consolidated  financial  position
of the Company as of March 31, 1999 and June 28, 1998; the results of operations
for the three and nine month periods ended March 31, 1999 and March 29,1998; and
the cash  flows  for the nine  month  periods  ended  March  31,  1999 and March
29,1998. In the opinion of management,  all necessary adjustments that were made
are of a normal recurring nature.

     Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting  principles
have been  condensed,  reclassified  or  omitted.  It is  suggested  that  these
consolidated  financial  statements be read in conjunction with the consolidated
financial  statements and notes thereto  included in the Company's Annual Report
on Form 10-KSB for the year end June 28, 1998. The results of operations for the
period  ended March 31, 1999 are not  necessarily  indicative  of the  operating
results that may be achieved for the full year.

     3. Basis of presentation

     Management  of the Company has made a number of estimates  and  assumptions
relating  to the  reporting  of assets and  liabilities  and the  disclosure  of
contingent  assets and  liabilities  to  prepare  these  consolidated  financial
statements in conformity with generally accepted accounting  principles.  Actual
results could differ from those estimates.

     The accompanying  consolidated financial statements have been prepared on a
going  concern  basis  that  contemplates  the  realization  of  assets  and the
satisfaction  of liabilities  and  commitments in the normal course of business.
However, due to the matters discussed below, its continuation as a going concern
cannot be reasonably assured.

     The Company has incurred  aggregate  losses since inception of $18,174,777,
inclusive  of a net  loss  for  the  nine  months  ended  December  31,  1998 of
$3,004,079,  exclusive of a $343,310  extraordinary gain on forgiveness of debt.
Based upon interim financial information prepared by management, the Company has
continued  to incur  losses in fiscal  1999.  Additionally,  $10,417 of Series C
subordinated notes payable matured on August 6, 1997, and a $2,089  subordinated
note payable matured on August 6, 1996, such obligations aggregating $12,506 and
all of which are in default as of March 31, 1999.

     Subsequent  to the  completion  of the private  placement in February  1999
which  effectively  satisfied all short and  long-term  debt that was in default
(see  Private  Placement  Offering  below),  the  Company  has  assembled  a new
management team and developed a new restaurant theme which will be introduced at
the recently reacquired Danbury, Connecticut location.

     Management  believes that the  finalization  of its cost reduction plan and
its approximately $6,000,000 private placement financing will enable the Company
to achieve profitable  operations and restore liquidity.  However,  no assurance
can be made  regarding the  achievement  of the goals  outlined in the strategic
plan as  outlined  above,  or if such  plans are  achieved,  that the  Company's
operations will be profitable.

     Private Placement Offering

     On October 27, 1998, the Company  commenced an offering (the "Offering") of
its Series B Convertible  Preferred Shares, $.10 par value. Between February 17,
1999 and July 2, 1999,  the Company sold  approximately  $6,000,000  of Series B
Preferred Shares pursuant to the Offering and converted approximately $1,350,000
of its debt to Company equity.  During the Offering,  the Company satisfied,  by
payment of cash and/or equity in the form of preferred  and/or common stock, the
following:   (a)  all  outstanding   Series  C  promissory  notes;  (b)  certain
outstanding  Series B promissory  notes;  (c) all outstanding  promissory  notes
related to the Fairfield facility; and (d) all outstanding promissory notes from
(i) September 1997, (ii) March through June 1998, and (iii) October and November
1998,  effectively  satisfying  all short  term and long term debt  which was in
default.

     The preferred  shares will be  convertible,  at the option of the holder at
any time after November 1999, at a conversion price initially equal to $0.05 per
share of common stock.  The conversion rate will be reduced by 10% per month for
each month the Company fails to comply with its obligations to file, and in good
faith process, a registration statement.

     The conversion  price is subject to the  adjustments on the terms set forth
in the Certificate of Designation.  The  outstanding  preferred  shares shall be
converted,  with no action  on the part of the  holder,  if,  at any time  after
February  2000,  the common stock into which the same is converted is registered
under the  Securities  Act and the  closing  bid price of the  common  stock for
twenty  consecutive  trading  days is at least four times the  conversion  price
($0.20 based on the initial conversion price of $0.05).

     Holders of preferred shares are entitled to receive,  quarterly,  dividends
at the rate of 8% per annum before any dividends may be paid with respect to the
Common Stock, which shall be paid in cash or preferred shares at the election of
the Company.  If there is a failure to pay dividends,  the Placement  Agent,  on
behalf of such holders, has the right to designate one director to the Company's
Board. In addition,  if the Company fails to comply with its obligations to file
and process a Registration Statement, the dividend rate will increase to 14% per
annum from issuance.

     Pursuant  to the March 1998  agreement  to acquire the  Ottomanelli  Group,
additional  consideration  due  to  anti-dilution  provisions  contained  in the
agreements  in the form of common  stock was  payable to the  Ottomanelli  Group
shareholders as a result of the private placement.  In February 1999,  5,000,000
shares of common stock were issued  pursuant to such  anti-dilution  provisions,
which  included a maximum  addition  which was met. As the  Company  recorded an
impairment  charge in fiscal 1999 relating to the  termination of the operations
of the  Ottomanelli  restaurants,  the fair  value of the common  stock  issued,
$250,000, was recognized as a further impairment loss in the quarter ended March
31,  1999.  (2) A note  receivable  of  $230,000,  which was received as partial
consideration for the sale of the Company's  Fairfield  facility,  was exchanged
with a value  assigned of $115,000 in partial  satisfaction  of a $425,000  note
payable and an additional  $115,000 loss on restaurant closure was recognized in
the quarter ended March 31, 1999.

     4. Financing Arrangements

     On December 8, 1997, the Company entered into a refinancing  arrangement in
which  it  raised  $500,000.  Four  hundred  thousand  dollars  of the  proceeds
therefrom were applied to reduce the indebtedness  (including  accrued interest)
resulting from a financing the Company conducted in March 1997. In October 1998,
$50,000 of this was paid and the  remaining  $100,000 of this debt was converted
into common stock of the Company.

     In August  1998,  the Company  issued a sixty day  convertible  note in the
principal  amount of $100,000 at an interest rate of 8% to an investment bank in
consideration for professional  services  rendered.  In February 1999, such note
was satisfied by conversion into Company equity.

     During the quarter ended  September 30, 1998,  the Company  privately  sold
1,100,000  shares of its  common  stock at $.15 per share  for an  aggregate  of
$165,000.

     In October 1998, a noteholder of a $100,000 remaining  outstanding  balance
from a $500,000  convertible  note due  September 4, 1997,  with unpaid  accrued
interest of  approximately  $90,000,  accepted common stock with a fair value of
$100,000  in  exchange  for  the  forgiving  of  all  outstanding   obligations.
Accordingly,  the Company has recorded an  extraordinary  gain of $88,950 in the
quarter ended December 31, 1998.

     Between  October and  December  1998,  the  Company  entered  into  private
financing  arrangements  with three  individuals  to provide  $150,000 of bridge
financing  at 16%  interest  per  annum,  plus  warrants,  with due dates of the
earlier  of the  closing  of the  proposed  private  placement  or ninety  days,
respectively.  All notes were satisfied by payment of cash and/or  conversion to
Company equity at the initial  closing of the private  placement on February 17,
1999.

     In connection with the private  placement,  the Company sold 211,289 shares
of Series B  preferred  stock at $25 per share,  generating  gross  proceeds  of
$5,282,225.  As part of the private placement,  noteholders,  including $293,332
Series C  subordinated  notes  payable  matured  on  August  6,  1997,  of which
noteholders with principal balances  aggregating  $62,499 extended the repayment
date to December 15,  1997,  $425,000  note payable  matured on January 2, 1997,
$11,709 note payable matured in February 1998,  $190,000 note payable matured on
December 31, 1997,  $150,000  notes  payable  matured on May 31, 1998,  $270,828
Series B  subordinated  notes  payable due July 7, 2000,  $50,000  notes payable
matured on October 31, 1998,  $100,000  note payable  matured on August 31, 1998
and  $150,000  notes  payable  matured on  February  1, 1999,  such  obligations
aggregating  $1,640,869 and all of which were in default,  including accrued and
unpaid  interest  of  approximately  $428,500,  entered  into a  series  of debt
satisfaction agreements,  whereby in exchange for cash payments, the issuance of
2,200,000  shares of common  stock,  with a fair value of $0.05 per  share,  the
issuance of 29,645  shares of Series B  preferred  stock at $25 per share and to
the mortgage  holder of the Fairfield  facility,  a discounted  note  receivable
arising from the sale of the  Fairfield  property with a fair value of $115,000,
all of the above mentioned indebtedness was extinguished.

     5. Restaurant Operations

     On July 2, 1998, The Rattlesnake Holding Company,  Inc. signed an agreement
to  purchase  some of the assets of 1562  Restaurant  Corp.  located at 1562 2nd
Avenue,  New York City.  The  purchase  price was  $425,000  payable  $20,000 on
contract,  $105,000  at closing,  and a  promissory  note at 8.5%  payable in 72
payments of $5,332.52. The Company decided not to pursue the acquisition of this
restaurant.

     On July 3, 1998, the Company  entered into a contract for the purchase of a
restaurant  facility in Greenwich,  Connecticut for $400,000 in a combination of
cash and notes. The Company ultimately chose not to purchase this property.

     On June 22, 1998, the Company closed its Danbury,  Connecticut facility and
subsequently lost its tenancy pursuant to a foreclosure action. Accordingly, the
Company recognized a loss of $270,426 in fiscal 1998 relating to the closure.

     On April 15, 1999,  the Company  subsequently  reacquired  the facility for
$1,350,000 in cash.

     6. Recent Accounting Pronouncements

     In June 1997, the FASB issued Statement 131, "Disclosures About Segments of
an Enterprise  and Related  Information",  effective for fiscal years  beginning
after  December 15, 1997.  This  statement  establishes  standards for reporting
information about operating segments in annual financial statements and requires
selected  information  about  operating  segments in interim  financial  reports
issued to  shareholders.  It also  establishes  standard for related  disclosure
about products and services,  geographic  areas and major  customers.  Operating
segments  are  defined as  components  of an  enterprise  about  which  separate
financial  information  is available  that is  evaluated  regularly by the chief
operating  decision maker in deciding how to allocate resources and in assessing
performance.  This Statement requires reporting segment profit and loss, certain
specific  revenue  and  expense  items  and  segment  assets.  It also  requires
reconciliations of total segment revenues,  total segment profit and loss, total
segment assets and other amounts disclosed for segments to corresponding amounts
reported in the consolidated  financial  statements.  Restatement of comparative
information  for earlier  periods  presented  is required in the initial year of
application.  Interim  information  is not  required  until the  second  year of
application,  at which time comparative information is required. The adoption of
the  Statement in fiscal 1999 will nit have a material  impact on its  financial
reporting as the Company has one operating segment.

     In  June  1998,   Statement  of  Financial  Accounting  Standards  No.  133
"Accounting  for  Derivative  Instruments  and Hedging  Activities"  ("Statement
133"),  was issued which is effective for fiscal years  beginning June 15, 2000.
Statement  133  standardizes  the  accounting  for  derivative  instruments  and
requires that all derivative  instruments be carried at fair value.  The Company
has  not  yet  determined  the  impact  that  Statement  133  will  have  on its
consolidated  financial statements and believes that such determination will not
be meaningful until closer to the date of initial adoption.

     7. Litigation

     The  Company  is a  co-defendant  in an  action  brought  by an owner of an
apartment  above the South Norwalk  Company  restaurant  for  negligence per se,
intentional infliction of emotional distress,  negligent infliction of emotional
distress,  and violations of the Connecticut  Unfair Trade Practices Act (CUTPA)
based  upon  alleged  excessive  noise and rude  and/or  threatening  conduct of
employees.  The jury awarded a verdict in the amount of $625,000 against various
defendants,   including  the  Company's  former  Chairman  on  August  5,  1998.
Accordingly,  the Company has  recorded a $625,000  charge in the quarter  ended
September 30, 1998 to accrue this judgment.  On November 20, 1998, the Court set
aside the  jury's  verdict  as to all  counts  against  the  Company  except for
plaintiff's claim for negligence per se and accordingly reduced the jury's award
to $225,000.  Accordingly, the Company reduced by $400,000, in the quarter ended
December 31, 1998,  the amount of the accrual  recognized  in the quarter  ended
September 30, 1998. The jury's award is currently on appeal by the Company,  and
plaintiff has appealed the Court's decision to set aside a portion of the jury's
verdict and reduce the award. There are also potential claims of indemnification
by other defendants  against the Company in the event the plaintiff's  appeal is
successful.

     In July 1999,  a demand  letter was  tendered  to the  Company by the legal
counsel  of  the  former  Chairman   seeking   indemnification   from  potential
liabilities   arising  out  of  this   matter.   This  demand  is  based  on  an
indemnification  provision in an agreement  between the former  Chairman and the
Company.   The  Company   believes   that  there  are  valid   defenses  to  the
indemnification claim.

     Plaintiff's negligence claims in this matter are arguably covered by one or
more  of  the  Company's   insurance   policies.   Farmington  Casualty  Company
("Farmington")  and Insurance  Company of Greater New York  ("GNY"),  two out of
three of the Company's  insurance  carriers,  retained  counsel to represent the
Company and defended the Company in this case under a reservation of rights. The
third, Public Service Mutual Ins. Co., denied coverage for the claim altogether.
GNY and Farmington  have  continued to prosecute the appeal in this matter,  but
under a reservation of rights.  The Company has advised  Farmington and GNY that
it intends to pursue its rights in an action for damages and declaratory  relief
in the event that the appeal is unsuccessful  and the insurance  carriers refuse
to provide  coverage for  plaintiff's  claims.  GNY and  Farmington  continue to
reserve all rights with respect to coverage.

     Settlement negotiations are ongoing,  however, there can be no assurance of
a satisfactory settlement.

     The  Company  is a  defendant  in an  action  for an  alleged  breach  of a
commercial  lease in which  damages  exceeding  $190,000 are being  sought.  The
Company has disputed this claim and believes that the plaintiff has inadequately
responded  to  the   Company's   demand  for  discovery   and   inspection   and
interrogatories.  A compliance  conference  was adjourned to September 15, 1999.
The Company intends to vigorously defend this action.

     The Company is also a party in various  other legal  actions  incidental to
the  normal  conduct  of its  business.  Management  does not  believe  that the
ultimate  resolution of these actions will have a material adverse effect on the
Company's consolidated financial position, results of operations or liquidity.

     8. Dividends in Arrears

     None.  Prior  dividends  due on Series A preferred  shares were waived upon
conversion to Series B pursuant to an Exchange and Waiver  Agreement  previously
entered into with the Series A Preferred Shareholders in February 1998.

     The Company is currently prohibited from paying cash dividends by virtue of
Delaware General Corporation Law.

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

     The following discussion and analysis contains  forward-looking  statements
which  involve  risks and  uncertainties.  When we use the  words  "anticipate,"
"believe,"  "estimate,"  and "expect" and similar  expressions as they relate to
the  Company  or  its   management,   they  are   intended   to  identify   such
forward-looking   statements  within  the  meaning  of  the  Private  Securities
Litigation  Reform Act of 1995. Our actual results,  performance or achievements
could  differ  materially  from the  results  expressed  in or  implied by these
forward-looking statements.

     Upon the  finalization  in 1999 of the $6,000,000  Series B Preferred Stock
private  placement  offering,  the Company  completed  its Cost  Reduction  Plan
commenced in fiscal 1997.

     At  March  31,  1999,  the  Company   operated  a  profitable   Rattlesnake
Southwestern  Grill  restaurant  in South  Norwalk,  Connecticut,  having closed
and/or sold all other restaurants previously owned.

     At March 31,  1999,  the long term and short term debt of the  Company  was
approximately  $502,000 a  significant  reduction  resulting  from cash payments
and/or  conversion to Company equity after the  completion of private  placement
noted above.

     At March 31, 1999, the Company's new management team, comprised of industry
specific  experienced  personnel,  continued to develop the  Company's  re-start
strategy of growth through Company and franchised  operation of a multi-regional
chain of mid-priced steakhouse restaurants, tentatively named Spencer's.

     Nine Months and Three  Months  Ended  March 31, 1999 as Compared  with Nine
Months and Three Months Ended March 29, 1998

     Gross  restaurant  sales  decreased 62.4% to $322,808 for the quarter ended
March 31, 1999 from $857,926 for the quarter ended March  29,1998.  For the nine
months  ended  March  31,  1999,  gross  restaurant  sales  decreased  52.5%  to
$1,421,073 from  $2,989,049.  Likewise,  net restaurant sales decreased 61.8% to
$312,260  for the quarter  ended March 31,  1999 from  $816,298  for the quarter
ended March  29,1998.  For the nine months ended March 31, 1999,  net restaurant
sales decreased 52.6% to $1,365,409 from $2,881,742.  The decrease in restaurant
sales  resulted  principally  from a  decrease  in  the  number  of  restaurants
operating during the period.

     Promotional  sales  decreased as a percentage  of gross sales from 4.9% for
the three  months  ended March  29,1998 to 3.3% for the quarter  ended March 31,
1999.  However,  for the nine months  ended March 31,  1999,  promotional  sales
increased to 3.9% from 3.6%.  Promotional  sales  decreased from $41,628 for the
quarter ended March 29, 1998 to $10,548 for the quarter ended March 31, 1999 and
decreased from $107,307 to $55,664 for the respective nine-month periods.  These
decreases are  attributable  to the  reduction of the number of units  operating
during the period.

     For the three months ended March 31, 1999,  the Company's  cost of food and
beverage sales decreased as a percentage of net sales to 31.6% as compared 32.7%
for the three months ended to March 29,1998. The cost of food and beverage sales
decreased to $98,763 for the three months ended March 31, 1999 from $266,849 for
the three months ended March 29,1998.  As a percentage of net sales for the nine
months  ended March 31,  1999,  cost of sales was 38.1% as compared to 32.4% for
the nine  months  ended  March  29,1998.  The cost of food  and  beverage  sales
decreased to $520,759 for the nine months ended March 31, 1999 from $932,746 for
the nine months ended March 29,1998.  The percentage  increase in the nine month
period is  attributable  to  inefficiencies  of the  Flemington  unit  closed in
November 1998.  The  percentage  decrease in the quarter ended March 31, 1999 is
attributable to the  efficiencies of the South Norwalk unit, the only restaurant
operating during the quarter.

     Restaurant  salaries and fringe benefits,  which consist of direct salaries
of restaurant  managers,  hourly  employee  wages and related  fringe  benefits,
decreased  to $112,429  for the three months ended March 31, 1999 as compared to
$283,145  for the three  months  ended March  29,1998.  As a  percentage  of net
restaurant sales, these costs increased to 36.0% in 1999 as compared to 34.7% in
1998.  For the nine months ended March 31, 1999  restaurant  salaries and fringe
benefits  increased  as a  percentage  of sales to 41.1% from 33.0% for the nine
months ended March  29,1998.  Actual  restaurant  salaries  and fringe  benefits
decreased  from $949,877 for the nine months ended March 29,1998 to $560,770 for
the nine months ended March 31, 1999. This decrease is attributed to a reduction
in restaurant  managers and other  personnel  relating to the closed units.  The
increase as a percentage of net sales is attributable  to allocating  management
salaries over a smaller restaurant base.

     Occupancy  and  other  related  expenses,  which  include  linen,  repairs,
maintenance,  utilities,  rent,  insurance and other occupancy related expenses,
decreased to $40,271 for the three months ended March 31, 1999 from $186,066 for
the three months ended March 29,1998.  As a percentage of net restaurant  sales,
these costs  decreased  to 12.9% in the three  months  ended March 31, 1999 from
22.8% in the three months ended March  29,1998.  For the nine months ended March
31,  1999,  these costs  increased to 30.5% from 24.7% for the nine months ended
March 29,1998.  The actual occupancy and related costs decreased to $416,747 for
the nine months ended March 31, 1999 as compared to $712,449 for the nine months
ended March 29,1998. The decrease is attributable to occupancy costs relating to
the closed units.

     Depreciation and amortization expenses, decreased to $13,893 or 4.5% of net
restaurant sales for the three months ended March 31, 1999 from $91,667 or 11.2%
for the three  months ended March  29,1998.  For the nine months ended March 31,
1999 these expenses decreased as a percentage of sales to 2.7% from 9.5% for the
nine months ended March 29,1998.  The actual  depreciation  and related expenses
were  $36,175 for the nine  months-ended  March 31, 1999 as compared to $275,001
for the nine months ended March  29,1998.  This  decrease is attributed to fewer
units in operation in fiscal 1999.

     General and  administrative  expenses increased to $1,587,185 for the three
months  ended  March 31,  1999 from  $83,205  for the three  months  ended March
29,1998.  General and  administrative  expenses  increased to $2,050,405 for the
nine months  ended March 31, 1999 from  $686,803 for the nine months ended March
29,1998. The increase is partially attributable to the value of a warrant issued
to a  consultant  pursuant to the terms of a consulting  agreement,  $1,075,000,
which was immediately exercisable and not subject to a forfeiture provision. The
remaining increase is attributable to additional professional fees.

     The  loss  on  closure  of  restaurant  sites  and  impairment  charges  is
attributable  to: (1)  Pursuant  to the March  1998  agreement  to  acquire  the
Ottomanelli Group,  additional  consideration,  due to anti-dilution  provisions
contained in the agreements,  common stock was payable to the Ottomanelli  Group
shareholders,  as a result of the private placement. In February 1999, 5,000,000
shares of common stock were issued  pursuant to such  anti-dilution  provisions,
which  included a maximum  addition  which was met. As the  Company  recorded an
impairment  charge in fiscal 1999 relating to the  termination of the operations
of the  Ottomanelli  restaurants,  the fair  value of the common  stock  issued,
$250,000, was recognized as a further impairment loss in the quarter ended March
31,  1999.  (2) A note  receivable  of  $230,000,  which was received as partial
consideration for the sale of the Company's  Fairfield  facility,  was exchanged
with a value  assigned of $115,000 in partial  satisfaction  of a $425,000  note
payable and an additional  $115,000 loss on restaurant closure was recognized in
the quarter ended March 31, 1999.

     In August 1998, a jury awarded a verdict in the amount of $625,000  against
various defendants,  including the Company and its former Chairman.  On November
20, 1998,  the Court set aside the jury's  verdict as to all counts  against the
Company  except for  plaintiff's  claim for  negligence  per se and  accordingly
reduced the jury's award to  $225,000.  The Company has recorded a charge in the
1999  Statement of Operations of $225,000 for the litigation  award.  The jury's
award is  currently  on appeal by the Company,  and  plaintiff  has appealed the
Court's  decision  to set aside a portion of the jury's  verdict  and reduce the
award.  There are also potential claims of  indemnification  by other defendants
against the Company in the event the plaintiff's appeal is successful.

     Interest expense  decreased to $65,154 for the three months ended March 31,
1999 from  $81,988 for the three months ended March  29,1998.  Interest  expense
decreased to $196,340 for the nine months ended March 31, 1999 from $179,335 for
the nine months ended March 29,1998.

     For the  three and nine  months  ended  March 31,  1999,  the  Company  has
recorded  an  extraordinary  gain on the  forgiveness  of debt in the  amount of
$254,360 and $343,310, respectively, principally resulting from a series of debt
satisfaction  agreements  consistent  with the  Company's  private  placement of
Series B Preferred Stock.




     YEAR 2000 MODIFICATIONS

     The Year 2000 Issue is the result of computer  programs being written using
two digits rather than four to define the applicable  year. Any of the Company's
computer programs that have  date-sensitive  software may recognize a date using
"00" as the year 1900 rather than the year 2000.  This could  result in a system
failure or miscalculations causing disruptions of operations,  including,  among
other  things,  a temporary  inability  to process  certain  transactions,  send
invoices, or engage in similar normal business activities.

     The Company does not believe the Year 2000 Issue will significantly  affect
its operations since it is in a "re-start" mode with respect to its business and
uses little or no computer equipment outside of its accounting programs.

     Based  on  recent  assessments,  the  Company  determined  that it will not
require  significant  modifications  of its  hardware  or software so that those
systems  will  properly  utilize  dates beyond  December  31, 1999.  The Company
presently  believes  that  with  little  or no  modifications  to  its  existing
software, the Year 2000 Issue can be mitigated.

     The  Company's  plan to resolve the Year 2000 Issue  involves the following
four phases: assessment,  remediation,  testing, and implementation.  As of June
30, 1999, the Company has fully completed its assessment of all internal systems
that could be significantly  affected by the Year 2000. The completed assessment
indicated that most of the Company's significant  information technology systems
will  not be  significantly  affected,  particularly  the  general  ledger,  and
inventory  systems.  The Company does not believe that the Year 2000  presents a
material  exposure  as it relates to the  Company's  products  or  services.  In
addition,  the  Company  has  begun to  gather  information  about the Year 2000
compliance  status  of its  external  agents  and  continues  to  monitor  their
compliance.  To date, the Company is not aware of any external agent with a Year
2000 issue that would  materially  impact the Company's  results of  operations,
liquidity,  or capital  resources.  The Company has  requested  from its bank an
assessment  of the  extent of the  bank's  Year 2000  compliance.  However,  the
Company has no means of ensuring that  external  agents will be Year 2000 ready.
The inability of external agents to complete their Year 2000 resolution  process
in a timely  fashion  could  materially  and adversely  impact the Company.  The
effect of non-compliance by external agents is not determinable.

     The  Company  will  utilize  external  software  and service  providers  to
reprogram, test and implement software for the Year 2000 modification as needed,
the cost of which is not expected to be  significant.  The Company will evaluate
the status of  completion of Year 2000  modifications  in September 30, 1999 and
will undertake all remaining  necessary  steps to seek to ensure its systems are
Year 2000 compliant.

     In the  event the  Company's  computer  systems  are  materially  adversely
affected by the Year 2000 issue, the Company's  business and operations could be
materially adversely affected by disruptions in the operations of other entities
with which the Company  interacts.  However,  the Company believes that the most
likely worst case scenario is that there will be some  localized  disruptions of
systems  that will affect  individual  facilities  or services  for a short time
rather than systematic or long-term problems  affecting its business  operations
as a whole. In such event the Company has contingency plans for certain critical
applications  and is  working  on plans  for  others.  These  contingency  plans
involve,  among other actions,  increasing  inventories,  and adjusting staffing
strategies.

     Liquidity and Capital Resources

     The Company has a long  history of losses  which has  depleted  its capital
resources  and  has  resulted  in the  incurrence  of a  significant  amount  of
indebtedness.  Without  additional  funds,  the Company will have to abandon its
long  term  plans for the  Spencer's  concept  development  and the  opening  of
additional  restaurants,  and  drastically  reduce its corporate  overhead.  The
Company  estimates  that the financing  obtained at the Offering will enable the
Company to effect some expansion and to operate through July 2000.  There can be
no  assurance  that the Company  will have  adequate  resources  after such time
unless it conducts profitable operations and/or obtains additional financing, of
which there can be no assurance.

     The Company's cash position  increased by $3,349,026  during the nine month
period  ended March 31, 1999,  principally  as the result of the proceeds of the
February  1999  private  placement of Series B Preferred  Stock,  as well as the
proceeds of a bridge financing and the sale of common stock. These proceeds were
partially  utilized  to pay down short and long term debt that was in default at
June 28, 1998, satisfy trade obligations and fund continuing operating losses.

     In connection with the private  placement,  the Company sold 211,289 shares
of Series B  Preferred  Stock at $25 per share,  generating  gross  proceeds  of
$5,282,225.  As part of the private placement,  noteholders,  including $293,332
Series C  subordinated  notes  payable  matured  on  August  6,  1997,  of which
noteholders with principal balances  aggregating  $62,499 extended the repayment
date to December 15,  1997,  $425,000  note payable  matured on January 2, 1997,
$11,709 note payable matured in February 1998,  $190,000 note payable matured on
December 31, 1997,  $150,000  notes  payable  matured on May 31, 1998,  $270,828
Series B  subordinated  notes  payable due July 7, 2000,  $50,000  notes payable
matured on october 31, 1998,  $100,000  note payable  matured on August 31, 1998
and  $150,000  notes  payable  matured on  February  1, 1999,  such  obligations
aggregating  $1,640,869 and all of which were in default,  including accrued and
unpaid  interest  of  approximately  $428,500,  entered  into a  series  of debt
satisfaction  agreements,  whereby in exchange for cash  payments,  the issue of
2,200,000  shares of common  stock,  with a fair value of $0.05 per  share,  the
issuance  of  $29,645  of Series B  Preferred  Stock at $25 per share and to the
mortgage holder of the Fairfield facility,  a discounted note receivable arising
from the sale of the Fairfield property with a fair value of $115,00, all of the
foregoing indebtedness was extinguished.

     In connection with the private placement,  $270,000 of Series B noteholders
converted  their  obligations  into 10,800 shares of Series B preferred stock at
$25  per  share.  Additionally,  approximately  $350,000  of  accounts  payable,
including  compensation  deferred by certain promoters of management,  converted
their receivable into approximately 7,000,000 shares of common stock at the fair
value of $0.05 per share.

     Also coincident with the private placement, the holders of 56,500 shares of
Series A Preferred  Stock exchanged their holdings for 55,370 shares of Series B
Preferred Stock and waived their right to the unpaid and accumulated dividends.

     Management of the Company was  completing its Cost  Reduction  Plan,  which
included a further  reduction in workforce  and  continuation  of the closure of
unprofitable restaurants,  in fiscal 1998. Such plan included the closing and/or
sale of the Yorktown Heights, White Plains, New York, Fairfield, Connecticut and
Lynbrook, New York locations, as well as the unopened New York City property. As
indicated  in note  4,  the  Company  performed  an  analysis  of its  remaining
restaurants  and  identified the Flemington  restaurant as  non-performing.  The
restaurant was subsequently closed in fiscal 1999. Effective upon the completion
of the private  placement,  the Company has assembled a new management  team and
developed  a new  restaurant  theme  which will be  introduced  at the  recently
reacquired Danbury, Connecticut location.

     Between  March  1998  and  September  1998,  the  Company   privately  sold
approximately  $850,000 of its common stock at $.15 per share. Through September
30,  1998,  the Company had sold  5,580,000  shares of common stock and received
proceeds of approximately $697,000, net of expenses.

     Between  October and  December  1998,  the  Company  entered  into  private
financing  arrangements to provide an aggregate of $150,000 of bridge  financing
at 16%, with due dates at the earlier of the closing of the private placement or
ninety  days,  respectively.  The  noteholders  also  received  warrants  for an
aggregate of 412,500 shares, at an exercise price of $0.05 per share expiring on
December 30, 2003.  The warrants were valued at $12,375 and recognized as a debt
issuance cost.

     In October 1998, a noteholder of a $100,000 remaining  outstanding  balance
from a $500,000  convertible  note due  September 4, 1997,  with unpaid  accrued
interest of  approximately  $90,000,  accepted  approximately  690,000 shares of
common stock with a fair value of $100,000, in exchange for the forgiving of the
outstanding interest obligation.

     At June 28,  1998,  the Company had  available a net  operating  loss carry
forward  (NOL) for  Federal  and State  income  tax  purposes  of  approximately
$13,962,000, which are available to offset future taxable income, if any, before
2013.  In accordance  with Section 382 of the Internal  Revenue Code of 1986, as
amended,  a change in more than 50% in the  beneficial  ownership of the Company
within a three-year period (an "Ownership  Change"),  will place an annual limit
on the  Company's  ability to utilize its existing NOL carry  forwards to offset
taxable  income in  current  and  future  periods.  The  Company  believes  that
ownership changes have occurred and will cause the annual  limitations to apply.
The Company has not determined  what the maximum annual amount of taxable income
is that can be reduced by the NOL carry forwards.

     Management  believes that the  finalization  of its Cost Reduction Plan and
its $6,000,000  private  placement  financing will enable the Company to achieve
profitable  operations and restore liquidity.  However, no assurance can be made
regarding  achievement  of the goals  outlined in the strategic plan as outlined
above,  or if such plans are  achieved,  that the Company's  operations  will be
profitable.

     Employment Agreements

     In October 1998, the Company entered into a three year employment agreement
(as  revised)  with an  individual  to act as President  and/or Chief  Executive
Officer  and  as a  member  of  the  Board  of  Directors  of  the  Company.  In
consideration,  the  employee  is to  receive  a  monthly  fee  of  $7,917  plus
reasonable  expenses.  In  addition,   the  employee  shall  be  entitled  to  a
performance  bonus and shall  receive a warrant to  purchase an amount of Common
Stock equal to ten (10%) percent of the outstanding common stock of the Company,
on a fully diluted  basis,  after the private  placement  financing at $0.05 per
share,  exercisable for a period of five years, one-third (1/3) of the number of
shares covered thereby vesting at the time of the private  placement  financing,
and  one-third  (1/3) at the end of each one year period  thereafter  during the
term.

     In October 1998, the Company entered into a three year employment agreement
(as revised) with an individual to provide  services as Chief Financial  Officer
and Vice President of the Company. In consideration,  the employee is to receive
a monthly fee of $4,333 plus  reasonable  expenses.  In  addition,  an option to
purchase  up to 300,000  shares of the  Company's  common  stock with an initial
exercise price of $0.05 per share,  exercisable for five (5) years, which option
will vest as to one-third  (1/3) of the number of shares covered  thereby at the
end of each one year period during the term.

     Consulting Agreements

     On  July  20,  1998,  the  Company  entered  into a three  year  consulting
agreement  with an  individual  to provide  service to design and  implement the
future expansion of the Company's planned restaurant concepts. In consideration,
the consultant is to receive a monthly fee of $1,000 plus  reasonable  expenses.
In addition a warrant to purchase an additional  300,000 shares of the Company's
non-restricted common stock with an initial exercise price of $.48 per share.

     In October 1998, the Company entered into a three year consulting agreement
with an individual to provide advice and consultation in the  implementation  of
the  future  expansion  of  the  Company's  planned  restaurant   concepts.   In
consideration,   the   consultant   shall  serve   without   regular,   periodic
compensation.  The consultant shall be entitled to a performance bonus and shall
receive a warrant to purchase an amount of Common  Stock equal to fifteen  (15%)
of the  outstanding  Common Stock of the Company on a fully  diluted basis after
the offering of Series B Preferred  Stock at $0.20 per share,  exercisable for a
period of five (5) years.


     SAFE HARBOR STATEMENT

     Certain  statements in this Form 10-QSB,  including  information  set forth
under  "Management's   Discussion  and  Analysis"  constitute   "forward-looking
statements" within the meaning of the Private  Securities  Litigation Reform Act
of 1995 (the  "Act").  The  Company  desires to avail  itself of  certain  "safe
harbor"  provisions of the Act and is therefore  including  this special note to
enable the Company to do so.  Forward-looking  statements  included in this Form
10-QSB or hereafter  included in other publicly  available  documents filed with
the Securities and Exchange  Commission,  reports to the Company's  stockholders
and other  publicly  available  statements  issued or  released  by the  Company
involve known and unknown  risks,  uncertainties,  and other factors which could
cause the  Company's  actual  results,  performance  (financial or operating) or
achievements  to differ  from the  future  results,  performance  (financial  or
operating)  achievements expressed or implied by such forward looking statement.
Such  future  results  are based upon  management's  best  estimates  based upon
current  conditions  and the most  recent  results of  operations.  These  risks
include,  but are not limited to, risks  associated with potential  acquisitions
and  development of new locations;  successful  implementation  of the Company's
cost containment plan and new operating strategy;  immediate need for additional
capital;  competition;  new management; the addition of a new restaurant format;
and other risks  detailed in the Company's  Securities  and Exchange  Commission
filings,  including  its Annual  Report on Form 10-KSB for the fiscal year 1998,
each of which could adversely affect the Company's  business and the accuracy of
the forward looking statements contained herein.



<PAGE>


     PART II

     Item 1: - Legal Proceedings


     South Norwalk, Connecticut

     The  Company  is a  co-defendant  in an  action  brought  by an owner of an
apartment  above the South Norwalk  Company  restaurant  for  negligence per se,
intentional infliction of emotional distress,  negligent infliction of emotional
distress,  and violations of the Connecticut  Unfair Trade Practices Act (CUTPA)
based  upon  alleged  excessive  noise and rude  and/or  threatening  conduct of
employees.  The jury awarded a verdict in the amount of $625,000 against various
defendants,  including  the  Company's  former  Chairman  on August 5, 1998.  On
November  20,  1998,  the Court set aside the  jury's  verdict  as to all counts
against the  Company  except for  plaintiff's  claim for  negligence  per se and
accordingly reduced the jury's award to $225,000.  The jury's award is currently
on appeal by the Company, and plaintiff has appealed the Court's decision to set
aside a portion of the  jury's  verdict  and  reduce  the award.  There are also
potential claims of  indemnification  by other defendants against the Company in
the event the plaintiff's appeal is successful.

     In July 1999,  a demand  letter was  tendered  to the  Company by the legal
counsel  of  the  former  Chairman   seeking   indemnification   from  potential
liabilities   arising  out  of  this   matter.   This  demand  is  based  on  an
indemnification  provision in an agreement  between the former  Chairman and the
Company.   The  Company   believes   that  there  are  valid   defenses  to  the
indemnification claim.

     Plaintiff's negligence claims in this matter are arguably covered by one or
more  of  the  Company's   insurance   policies.   Farmington  Casualty  Company
("Farmington")  and Insurance  Company of Greater New York  ("GNY"),  two out of
three of the Company's  insurance  carriers,  retained  counsel to represent the
Company and defended the Company in this case under a reservation of rights. The
third, Public Service Mutual Ins. Co., denied coverage for the claim altogether.
GNY and Farmington  have  continued to prosecute the appeal in this matter,  but
under a reservation of rights.  The Company has advised  Farmington and GNY that
it intends to pursue its rights in an action for damages and declaratory  relief
in the event that the appeal is unsuccessful  and the insurance  carriers refuse
to provide  coverage for  plaintiff's  claims.  GNY and  Farmington  continue to
reserve all rights with respect to coverage.

     Settlement negotiations are ongoing,  however, there can be no assurance of
a satisfactory settlement.


     Danbury, Connecticut

     A  foreclosure  action was  commenced in September or October 1998 by Union
Savings Bank (the "Bank") against the landlord of The  Rattlesnake  Southwestern
Grill (closed for  renovations) in Danbury,  Connecticut  based on the landlords
mortgage arrears.  Rattlesnake Danbury, Inc., the lessee of the restaurant,  has
been joined as a defendant.

     Lynbrook, New York

     The  Company is  defending  an action  brought by Jack  Cioffi  Trust,  the
landlord of a former  Rattlesnake  restaurant  in Lynbrook  New York leased by a
subsidiary of the Company. The action against the Company is based on an alleged
guaranty of the lease  payments  due from the  subsidiary  of the  Company.  The
Company is of the position that the landlord waived the guarantee at the time of
the  surrender of the premises in  September  1997.  The action seeks the sum of
approximately $190,000.


     Item 2 - Changes in Securities and Use of Proceeds

     On October 27, 1998, the Company  commenced an offering(the  "Offering") of
its Series B Convertible  Preferred Shares, $.10 par value. Between February 17,
1999 and July 2, 1999,  the Company sold  approximately  $6,000,000  of Series B
Preferred Sahres pursuant to the Offering and converted approximately $1,350,000
of its debt to Company equity.  During the Offering,  the Company satisfied,  by
payment of cash and/or equity in the form of preferred  and/or common stock, the
following:   (a)  all  outstanding   Series  C  promissory  notes;  (b)  certain
outstanding  Series B promissory  notes;  (c) all outstanding  promissory  notes
related to the Fairfield facility; and (d) all outstanding promissory notes from
(i) September 1997, (ii) March through June 1998, and (iii) October and November
1998,  effectively  satisfying  all short  term and long term debt  which was in
default.

     The preferred  shares will be  convertible,  at the option of the holder at
any time after November 1999, at a conversion price initially equal to $0.05 per
share of common stock.  The conversion rate will be reduced by 10% per month for
each month the Company fails to comply with its obligations to file, and in good
faith process, a registration statement.


     Item 3. - Defaults upon Senior Securities

     None.


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

     None.


     Item 5. - Other Information

     The Company's Common Stock is not listed on the NASDAQ Small Cap Market and
as of November 4, 1997 was suspended  from trading on the Boston Stock  Exchange
(the "BSE"). The BSE has applied for the delisting of the Company's common stock
from such exchange pursuant to Rule 12d-2f2.

     The Company  securities are traded on the NASDAQ Bulletin Board. Due to the
nature of such  markets and the "penny  stock'  rules to which the common  stock
trades  (Rule  15g-9  promulgated  under the SEC Act)  there may not be a liquid
trading market in the common stock.

     The Company is currently prohibited from paying cash dividends by virtue of
the Delaware General Corporation Law.

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

     (b) Reports on Form 8-K

     During the quarter  ended March 31, 1999,  the Company  filed no reports on
Form 8-K.



<PAGE>





                                   SIGNATURES



     In accordance  with the  requirements  of the Exchange Act, the  Registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.




                      THE RATTLESNAKE HOLDING COMPANY, INC.
                                  (Registrant)



                                              By: /s/
                                                  -------------------------
                                                  Kenneth Berry
                                                  Chief Executive Officer


                                              By: /s/
                                                  -------------------------
                                                  Frank Ferro
                                                  Chief Financial Officer


Date:  August 12, 1999