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

                                 FORM 10-QSB

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

      For the Quarterly Period Ended June 30, 2002

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

      For the transition period from _________ to _________

                       Commission File Number: 0-24592

                              CINEMA RIDE, INC.
      -----------------------------------------------------------------
      (Exact name of small business issuer as specified in its charter)

                  Delaware                            95-4417467
       -------------------------------           ----------------------
       (State or other jurisdiction of              (I.R.S. Employer
       incorporation or organization)            Identification Number)


        12001 Ventura Place, Suite 340, Studio City, California 91604
        --------------------------------------------------------------
                   (Address of principal executive offices)

                  Issuer's telephone number: (818) 761-1002

                                Not applicable
             ---------------------------------------------------
             (Former name, former address and former fiscal year,
                        if changed since last report.)


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 issuer was required to file such reports), and
(2) has been subject to such filing requirements for the past 90 days.
Yes [X]  No [ ]

As of June 30, 2002, the Company had 5,149,800 shares of common stock issued
and outstanding.

Transitional Small Business Disclosure Format:  Yes [ ]  No [X]

Documents incorporated by reference:  None.


                                      -1-
<PAGE>


                      CINEMA RIDE, INC. AND SUBSIDIARIES

                                    INDEX




PART I.   FINANCIAL INFORMATION

  Item 1.  Financial Statements

      Consolidated Balance Sheets - June 30, 2002 (Unaudited) and December
      31, 2001

      Consolidated Statements of Operations (Unaudited) - Three Months and
      Six Months Ended June 30, 2002 and 2001

      Consolidated Statements of Cash Flows (Unaudited) - Six Months Ended
      June 30, 2002 and 2001

      Notes to Consolidated Financial Statements (Unaudited) - Three Months
      and Six Months Ended June 30, 2002 and 2001

  Item 2.  Management's Discussion and Analysis or Plan of Operation


PART II.  OTHER INFORMATION

  Item 1.  Legal Proceedings

  Item 2.  Changes in Securities and Use of Proceeds

  Item 6.  Exhibits and Reports on Form 8-K


SIGNATURES


                                      -2-
<PAGE>


                       Cinema Ride, Inc. and Subsidiaries
                           Consolidated Balance Sheets
<TABLE>
<CAPTION>

                                      June 30,       December 31,
                                        2002             2001
                                     -----------     ------------
                                     (Unaudited)
<S>                                 <C>              <C>
ASSETS

Current assets:
  Cash and cash equivalents         $   233,186       $   66,856
  Prepaid expenses and other
    current assets                       41,524           35,096
                                     ----------        ---------
Total current assets                    274,710          101,952
                                     ----------        ---------

Property and equipment:
  Office equipment and furniture        111,180          111,180
  Equipment under capital lease         172,854          172,854
  Leasehold improvements                947,766        1,061,682
  Theater and film equipment          1,864,406        1,868,804
                                     ----------        ---------
                                      3,096,206        3,214,520

  Less accumulated depreciation      (2,358,594)      (2,258,404)
                                     ----------        ---------
                                        737,612          956,116
                                     ----------        ---------

Other assets:
  Visual effects library, net of
    accumulated amortization of
    $1,042,828 and $1,009,540 at
    June 30, 2002 and December
    31, 2001, respectively               49,942           83,230
  Investment in joint venture           304,004          323,795
  Consulting agreement                    2,601            7,803
  Deferred lease costs and other
    assets                               33,030           53,291
                                     ----------        ---------
                                        389,577          468,119
                                     ----------        ---------
Total assets                        $ 1,401,899       $1,526,187
                                     ==========        =========

</TABLE>

                                 (continued)

                                      -3-
<PAGE>

                       Cinema Ride, Inc. and Subsidiaries
                     Consolidated Balance Sheets (continued)

<TABLE>
<CAPTION>
                                       June 30,     December 31,
                                         2002            2001
                                     -----------     ------------
                                     (Unaudited)
<S>                                 <C>               <C>
LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
  Accounts payable and accrued
    expenses                        $   300,297       $  456,454
  Current portion of capital
    lease obligations                    35,404           46,414
  Current portion of notes
    payable (Note 2)                    190,065          827,908
                                     ----------        ---------
Total current liabilities               525,766        1,330,776
                                     ----------        ---------

Non-current liabilities:
  Capital lease obligations,
    less current portion                 64,802           79,801
  Notes payable, less current
    portion (Note 2)                    702,766           47,991
  Deferred rent                          36,775           45,601
                                     ----------        ---------
                                        804,343          173,393
                                     ----------        ---------

Commitments and contingencies
  (Note 3)

Stockholders' equity (Note 5):
Preferred stock, $0.01 par value -
  Authorized - 500,000 shares
  Issued - None                            -                -
Common stock, $0.08 par value -
  Authorized - 20,000,000 shares
  Issued and Outstanding -
  5,149,800 shares and 1,945,900
  shares at June 30, 2002 and
  December 31, 2001, respectively       411,984          155,672
Additional paid-in capital            9,898,742        9,323,798
Accumulated deficit                 (10,238,936)      (9,457,452)
                                     ----------        ---------
Total stockholders' equity               71,790           22,018
                                     ----------        ---------
Total liabilities and
  stockholders' equity              $ 1,401,899       $1,526,187
                                     ==========        =========

</TABLE>


         See accompanying notes to consolidated financial statements.

                                      -4-
<PAGE>

                      Cinema Ride, Inc. and Subsidiaries
              Consolidated Statements of Operations (Unaudited)
<TABLE>
<CAPTION>


                                      Three Months Ended June 30,
                                      ---------------------------
                                         2002              2001
                                      ---------         ---------

<S>                                   <C>               <C>
Revenues                              $ 569,423         $ 600,932

Direct costs of revenues (Note 4)       352,987           278,795

Selling and marketing expenses           17,609            38,367

General and administrative
  expenses, including non-cash
  compensation expense of
  $74,193 in 2002 and $24,465
  in 2001 ($37,693 in 2002 and
  $12,600 in 2001 to officers
  and directors) (Note 5)               377,422           296,842

Depreciation and amortization            82,047            85,177

Start-up costs of new business
  venture (Note 6)                       17,309            10,082

Closure costs of New Jersey
  ride facility (Note 7)                119,023              -
                                        -------           -------
Loss from operations                   (396,974)         (108,331)

Other income (expense):
  Equity in net income of
    joint venture                         1,693             3,350
  Interest income                            11               213
  Interest expense                      (39,637)           (7,634)
  Other income                           16,649              -
                                        -------           -------
Net loss                              $(418,258)        $(112,402)
                                        =======           =======

Net loss per common share -
  basic and diluted (Note 1)             $(0.10)           $(0.10)
                                           ====              ====

Weighted average common
  shares outstanding -
  basic and diluted                   3,998,799         1,175,182
                                      =========         =========
</TABLE>




         See accompanying notes to consolidated financial statements.

                                      -5-
<PAGE>

                      Cinema Ride, Inc. and Subsidiaries
              Consolidated Statements of Operations (Unaudited)
<TABLE>
<CAPTION>


                                       Six Months Ended June 30,
                                      --------------------------
                                         2002             2001
                                      ---------        ---------

<S>                                  <C>              <C>
Revenues                             $1,103,885       $1,158,123

Direct costs of revenues (Note 4)       672,990          639,196

Selling and marketing expenses           35,953           82,838

General and administrative
  expenses, including non-cash
  compensation expense of
  $257,756 in 2002 and $24,465
  in 2001 ($120,756 in 2002 and
  $12,600 in 2001 to officers
  and directors) (Note 5)               805,304          516,433

Depreciation and amortization           173,112          170,250

Start-up costs of new business
  venture (Note 6)                       28,523           16,130

Closure costs of New Jersey
  ride facility (Note 7)                119,023             -
                                      ---------        ---------
Loss from operations                   (731,020)        (266,724)

Other income (expense):
  Equity in net income of
    joint venture                        18,303           11,065
  Interest income                            33              598
  Interest expense                      (85,449)         (57,462)
  Other income                           16,649             -
                                      ---------        ---------
Net loss                             $ (781,484)      $ (312,523)
                                      =========        =========

Net loss per common share -
  basic and diluted (Note 1)             $(0.21)          $(0.32)
                                           ====             ====

Weighted average common
  shares outstanding -
  basic and diluted                   3,693,579          982,502
                                      =========          =======
</TABLE>



          See accompanying notes to consolidated financial statements.

                                      -6-
<PAGE>


                       Cinema Ride, Inc. and Subsidiaries
                Consolidated Statements of Cash Flows (Unaudited)
<TABLE>
<CAPTION>

                                      Six Months Ended June 30,
                                     --------------------------
                                        2002            2001
                                      ---------       ---------
<S>                                   <C>             <C>
Cash flows from operating activities:
Net loss                              $(781,484)      $(312,523)
Adjustments to reconcile net loss
  to net cash used in operating
  activities:
  Depreciation and amortization         173,112         170,250
  Common stock and warrants issued
    for services                        257,756          24,465
  Closure costs of New Jersey
    ride facility                       119,023            -
  Settlement of obligation to
    landlord                               -            (70,580)
  Other income                          (16,649)           -
  Equity in net income of joint
    venture                             (18,303)        (11,065)
  Amortization of consulting
    agreement                             5,202           5,202
  Amortization of deferred
    financing costs                      19,574           6,209
  Changes in operating assets and
    liabilities:
    (Increase) decrease in:
      Prepaid expenses and other
        current assets                   (8,153)          5,441
    Increase (decrease) in:
      Accounts payable and
        accrued expenses                (76,196)        173,264
      Deferred rent                      (8,826)         (8,827)
                                        -------         -------
Net cash used in operating
  activities                           (334,944)        (18,164)
                                        -------         -------


</TABLE>

                                   (continued)

                                      -7-
<PAGE>

                       Cinema Ride, Inc. and Subsidiaries
          Consolidated Statements of Cash Flows (Unaudited) (continued)
<TABLE>
<CAPTION>

                                      Six Months Ended June 30,
                                      -------------------------
                                         2002            2001
                                      ---------       ---------
<S>                                   <C>             <C>
Cash flows from investing activities:
  Purchase of property and equipment  $ (37,931)      $    (247)
  Dividends received from joint
    venture                              38,094          28,076
                                        -------         -------
Net cash provided by investing
  Activities                                163          27,829
                                        -------         -------

Cash flows from financing activities:
  Payments on notes payable             (26,009)        (11,797)
  Principal payments on capital
    lease obligations                   (30,380)        (23,471)
  Sale of securities                    557,500            -
                                        -------         -------
Net cash provided by (used in)
  financing activities                  501,111         (35,268)
                                        -------         -------

Cash and cash equivalents:
  Net increase (decrease)               166,330         (25,603)
  At beginning of period                 66,856         109,834
                                        -------         -------
  At end of period                    $ 233,186       $  84,231
                                        =======         =======

</TABLE>




         See accompanying notes to consolidated financial statements.

                                      -8-
<PAGE>


                       Cinema Ride, Inc. and Subsidiaries
             Notes to Consolidated Financial Statements (Unaudited)
                Three Months and Six Ended June 30, 2002 and 2001


1. Organization and Basis of Presentation

Basis of Presentation - The consolidated financial statements include the
operations of Cinema Ride, Inc. and its wholly-owned subsidiaries (the
"Company").  All significant intercompany transactions and balances have been
eliminated in consolidation.

Business - The Company is in the business of developing and operating rides
consisting of 3-D motion simulator attractions and filmed entertainment that
combines projected three-dimensional action films of approximately four
minutes in duration with computer-controlled, hydraulically-mobilized
capsules that are programmed to move in concert with the on-screen action.
The technology employed by the Company in its ride facilities includes Patent
No. 5,857,917 granted to the Company on January 12, 1999 by the United States
Patent and Trademark Office for 3-D video projected motion simulator rides.
The Company's ride facilities are located in Las Vegas, Nevada; Edmonton,
Alberta, Canada; and Atlanta, Georgia.

Joint Venture - The Company is a party to a joint venture agreement with Dave
& Buster's, Inc., pursuant to which it has installed a 3-D motion simulation
theater at the Dave & Buster's, Inc. facility in Atlanta, Georgia.  The joint
venture agreement has not been formally extended and the operations are
continuing on a month-to-month basis.  Each party to the joint venture
agreement shares the joint venture's revenues and operating expenses equally.
The joint venture agreement also requires the Company to be solely
responsible for certain administrative expenses.

Comments - The interim consolidated financial statements are unaudited, but
in the opinion of management of the Company, contain all adjustments, which
include normal recurring adjustments, necessary to present fairly the
financial position at June 30, 2002, the results of operations for the three
months and six months ended June 30, 2002 and 2001, and the cash flows for
the six months ended June 30, 2002 and 2001.  The consolidated balance sheet
as of December 31, 2001 is derived from the Company's audited financial
statements.

Certain information and footnote disclosures normally included in financial
statements that have been presented in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to the rules
and regulations of the Securities and Exchange Commission with respect to
interim financial statements, although management of the Company believes
that the disclosures contained in these financial statements are adequate to
make the information presented therein not misleading.  For further
information, refer to the consolidated financial statements and notes thereto
included in the Company's Annual Report on Form 10-KSB for the fiscal year
ended December 31, 2001, as filed with the Securities and Exchange Commission.

The results of operations for the three months and six months ended June 30,
2002 are not necessarily indicative of the results of operations to be
expected for the full fiscal year ending December 31, 2002.

Use of Estimates - The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities, disclosure of contingent assets and liabilities at the date of
the financial statements, and the reported amounts of revenues and expenses
during the reporting period.  Actual results could differ from those
estimates.

                                      -9-
<PAGE>

Reclassification - Certain amounts have been reclassified in 2001 to conform
with the presentation in 2002.

Going Concern - The consolidated financial statements have been prepared
assuming that the Company will continue as a going concern, which
contemplates the realization of assets and the satisfaction of liabilities in
the normal course of business.  The carrying amounts of assets and
liabilities presented in the consolidated financial statements do not purport
to represent the realizable or settlement values.  The Company has
experienced declining revenues and recurring operating losses, and had a
substantial working capital deficit at June 30, 2002 and December 31, 2001.
The Company's independent certified public accountants, in their independent
auditors' report on the consolidated financial statements as of and for the
year ended December 31, 2001, have expressed substantial doubt about the
Company's ability to continue as a going concern.

The Company will require additional capital to fund operating and debt
service requirements.  The Company has been exploring various alternatives to
raise this required capital and has raised a portion of the required capital,
but there can be no assurances that the Company will ultimately be successful
in this regard.  During the six months ended June 30, 2002, the Company
raised $557,500 of new capital through the sale of its equity securities.
The private placement offering consisted of units sold at $0.25 per unit.
Each unit consisted of one share of common stock and one common stock
purchase warrant.  The warrants are exercisable at $0.50 per share for a
period of 18 months from the date of issuance.  The Company is continuing its
efforts to raise new capital subsequent to June 30, 2002.  The Company is
attempting to raise a total of up to $750,000 of new capital during 2002.

To the extent that the Company is unable to secure the capital necessary to
fund its future cash requirements on a timely basis and/or under acceptable
terms and conditions, the Company may not have sufficient cash resources to
maintain operations.  In such event, the Company may be required to consider
a formal or informal restructuring or reorganization.

From time to time the Company may also consider a wide range of other
business opportunities.  Some of these business opportunities may be
unrelated to the Company's current business activities, could require
additional capital, and could result in a change in control of the Company.

Foreign Currency Translation - Foreign currency denominated assets and
liabilities of the subsidiary where the United States dollar is the
functional currency and which have certain transactions denominated in a
local currency are remeasured as if the functional currency was the United
States dollar.  The remeasurement of local currency into United States
dollars creates translation adjustments which are immaterial and which are
included in the statement of operations.

Net Loss Per Common Share - Basic loss per common share is calculated by
dividing net loss by the weighted average number of common shares outstanding
during the period.  Diluted loss per common share reflects the potential
dilution that would occur if dilutive stock options and warrants were
exercised.  These potentially dilutive securities were anti-dilutive for all
periods presented, and accordingly, basic and diluted loss per common share
is the same for all periods presented.  As of June 30, 2002, potentially
dilutive securities consisted of outstanding stock options and warrants to
acquire 1,508,188 shares and 3,025,009 shares of common stock, respectively.

Stock-Based Compensation - The Company periodically issues stock options and
warrants to employees and non-employees in non-capital raising transactions
for services and for financing costs.

                                      -10-
<PAGE>

The Company has adopted Statement of Financial Accounting Standards ("SFAS")
No. 123, "Accounting for Stock-Based Compensation", which establishes a fair
value method of accounting for stock-based compensation plans.

The provisions of SFAS No. 123 allow companies to either record an expense in
the financial statements to reflect the estimated fair value of stock options
or warrants to employees, or to continue to follow the intrinsic value method
set forth in Accounting Principles Board Opinion No. 25, "Accounting for
Stock Issued to Employees", but to disclose on an annual basis the pro forma
effect on net income (loss) and net income (loss) per common share had the
fair value of the stock options and warrants been recorded in the financial
statements.  The Company has elected to continue to account for stock-based
compensation plans utilizing the intrinsic value method.  Accordingly,
compensation cost for stock options and warrants is measured as the excess,
if any, of the fair market price of the Company's common stock at the date of
grant above the amount an employee must pay to acquire the common stock.

In accordance with SFAS No. 123, the cost of stock options and warrants
issued to non-employees is measured at the grant date based on the fair value
of the award.  The fair value of the stock-based award is determined using
the Black-Scholes option pricing model.  The resulting amount is charged to
expense on the straight-line basis over the period in which the Company
expects to receive benefit, which is generally the vesting period.

The Company periodically issues shares of common stock for services or for
financing costs.  Such shares are valued based on the market price on the
transaction date, adjusted for factors such as trading restrictions,
registration rights, trading volume and market liquidity, which generally
results in a reduction ranging from 25% to 33% to the market price at the
transaction date.


2.  Note Payable to Secured Lender

On December 31, 1996, the Company completed a financing agreement with Finova
Technology Finance, Inc., which was structured as a sale-leaseback
transaction of certain equipment owned by the Company.  Based on the
substance of this transaction, this financing agreement was accounted for as
a note payable for financial reporting purposes.  The gross loan amount was
$1,575,027, repayable over a four year period at $40,903 per month with a
balloon payment of $157,503.  On March 10, 1999, the financing agreement was
amended to reduce the monthly payments from $40,903 to $21,789, and to extend
the maturity date from January 1, 2001 to January 1, 2004, with no change in
the balloon payment of $157,503.  The loan bore interest at 16.75% per
annum.  The financing agreement requires the Company to repurchase the
equipment at the end of the lease for $1.00.

Effective June 25, 2001, the Company completed a Second Modification
Agreement and Waiver of Defaults with the secured lender, which provided
for:  (1) the waiver of all prior payment defaults; (2) the reduction of the
monthly payment from $21,789 to $10,674, which represents interest only
payments at 16.75% per annum; (3) the increase in the principal balance due
the lender of accrued interest payable of $50,083; (4) the acceleration of
the due date of the loan from January 1, 2004 to March 1, 2002; (5) the
repricing of a common stock purchase warrant previously issued to the lender
to purchase 12,500 shares of common stock exercisable through December 31,
2003, which reduced the exercise price from $16.00 per share to $1.00 per
share; (6) the issuance of common stock purchase warrants to the lender to
purchase 25,000 shares of common stock at $0.50 per share and 25,000 shares
of common stock at $1.00 per share exercisable through June 25, 2011; and (7)
the revision of the lender's Warrant Holder Rights Agreement to eliminate
demand registration rights.

                                      -11-
<PAGE>

The Company calculated the fair value of the warrants to purchase an
aggregate of 50,000 shares of common stock and the repricing of the warrant
to purchase 12,500 shares of common stock pursuant to the Black-Scholes
option pricing model.  The aggregate fair value of $47,250 was recorded as
deferred financing costs, and was charged to operations as financing expense
through March 1, 2002.  In addition, previously recorded deferred financing
costs were charged to operations as financing expense through the accelerated
due date of the loan of March 1, 2002.

The balance of this loan was $780,613 at December 31, 2001.  As a result of
this loan being due in full on March 1, 2002, the Company classified the
entire obligation to the secured lender as a current liability in the
consolidated financial statements at December 31, 2001.  Required monthly
payments on such loan were in arrears at December 31, 2000 and 2001, and the
Company did not make the balloon payment due on March 1, 2002.

Effective April 17, 2002, the Company completed a Third Modification
Agreement and Waiver of Defaults with the secured lender, which provided
for:  (1) the waiver of all prior payment defaults; (2) interest on the
unpaid balance at 16.64% per annum; (3) the payment of interest only for the
months of March, April and May 2002; and (4) commencing June 2002, monthly
payments of principal and interest of $18,955 for a period of five years.  As
a result of the completion of this agreement, the balance of this loan was
reclassified at June 30, 2002, with $107,695 classified as a current
liability and $662,244 classified as a long-term liability.


3.  Legal Proceedings

The Company's former Chief Financial Officer, Toufic R. Bassil, has asserted
claims against the Company for breach of his employment agreement and his
wrongful termination as an officer of the Company without cause effective
March 1, 1999.  These claims are being asserted pursuant to a binding
arbitration proceeding through the American Arbitration Association.
Although the arbitrator has determined that the Company is liable for damages
from breach of the employment agreement, damages have not yet been
determined.  The wrongful termination claim is still in the discovery stage
and the Company is actively defending this matter.  In the opinion of
management, adequate provision has been made in the consolidated financial
statements with respect to the foregoing claims.


4.  Lease Restructuring

On June 13, 2001, the Company's wholly-owned subsidiary entered into a Lease
Modification Agreement with the landlord for the Company's Elizabeth, New
Jersey ride facility (the "Lease Modification Agreement").  The original
lease agreement was dated November 1, 1999.  The Lease Modification Agreement
provided for:  (1) a reduction in the base monthly rent from $8,575 to
$4,388; (2) a decrease in the annual gross sales utilized to calculate the
additional rent due the landlord (based on a percentage factor of 10%) from
$1,029,000 to $526,575; (3) a payment to the landlord by the Company of
$50,000 in full satisfaction of all construction charges and rent for the
period from October 1, 2000 through May 31, 2001; (4) forgiveness of $70,580
of accrued rent payable by the Company to the landlord; and (5) deletion of a
provision in the original lease agreement that allowed the Company to
terminate the lease if a movie theater had not opened in the shopping mall in
which the Company's ride facility is located by a certain date.

                                      -12-
<PAGE>

The Company believes that the failure by the landlord to arrange for the
timely opening of a movie theater in the shopping mall in which the Company's
ride facility is located has negatively impacted operating results at this
location.  Accordingly, the Company has recorded the forgiveness of accrued
rent payable of $70,580 as a reduction to direct costs of revenues for the
three months and six months ended June 30, 2001, since it was reimbursement
by the landlord for damages that the Company had sustained, and since rent
payments were originally included in direct costs of revenues.


5.  Stockholders' Equity

On March 13, 2001, the Company granted its Chief Executive Officer a stock
option to purchase an aggregate of 800,000 shares of common stock expiring on
the earlier to occur of three years from the date of vesting or March 13,
2006.  The stock option is exercisable in four equal increments of 200,000
shares at exercise prices of $0.38, $1.00, $1.50 and $2.00 per share,
respectively.  The fair market value of the common stock on March 13, 2001
was $0.37 per share.  The stock option vests based on the attainment of
certain milestones by the Company, including raising new equity capital and
reaching certain levels of earnings before interest, taxes, depreciation and
amortization, none of which had been reached as of June 30, 2002.  In
accordance with accounting for such stock options utilizing the intrinsic
value method, no compensation expense has been recorded in the Company's
consolidated financial statements.

On June 5, 2001, the Company granted stock options to two employees to
purchase an aggregate of 240,000 shares of common stock, including an option
for 150,000 shares of common stock to the Company's Vice President of
Operations, exercisable through June 5, 2006 at $.15 per share, which was
equal to fair market value on the date of grant.  The options vest in equal
annual installments on June 5, 2001, 2002 and 2003.  In accordance with
accounting for such stock options utilizing the intrinsic value method, no
compensation expense was recorded in the Company's consolidated financial
statements.

On June 5, 2001, the Company's Chief Executive Officer exercised a portion of
a previously issued warrant for 1,538,461 shares of common stock exercisable
at $0.13 per share through February 2, 2002.  The Chief Executive Officer
exercised warrants for 923,077 shares of common stock and paid the exercise
consideration by canceling his $120,000 loan to the Company.  The unexercised
portion of the warrant for 615,384 shares of common stock was extended for an
additional two years, and cashless exercise provisions were added.  The
exercise price of the warrant and the fair market value of the Company's
common stock on the extension date were approximately equal.  Accordingly, in
accordance with accounting for such warrants utilizing the intrinsic value
method, no compensation expense was recorded in the Company's consolidated
financial statements.

During June 2001, the Company issued to various employees an aggregate of
133,000 shares of common stock as a bonus, including 20,000 shares of common
stock to the Company's Vice President of Operations.  The aggregate fair
market value of $13,965 was charged to operations during the three months and
six months ended June 30, 2001.

During June 2001, the Company issued to each of its two non-employee
directors 50,000 shares of common stock as a bonus.  The aggregate fair
market value of $10,500 was charged to operations during the three months and
six months ended June 30, 2001.

In conjunction with the restructuring of the Company's obligations to its


                                      -13-
<PAGE>

primary secured lender on June 25, 2001, the Company repriced previously
issued warrants to purchase 12,500 shares of common stock through December
31, 2003 from $16.00 per share to $1.00 per share, and issued new warrants to
purchase 25,000 shares of common stock at $0.50 per share and 25,000 shares
of common stock at $1.00 per share exercisable through June 25, 2011, as
described at Note 2.

On January 28, 2002, the Company issued to various employees and consultants
an aggregate of 350,000 shares of common stock as a bonus.  The aggregate
fair market value of $73,500 was charged to operations during the six months
ended June 30, 2002.

On January 28, 2002, the Company issued to its Vice President of Operations
75,000 shares of common stock as a bonus.  The aggregate fair market value of
$15,750 was charged to operations during the six months ended June 30, 2002.

On January 28, 2002, the Company issued to each of its two non-employee
directors 100,000 shares of common stock as a bonus.  The aggregate fair
market value of the 200,000 shares of $42,000 was charged to operations
during the six months ended June 30, 2002.

During the three months ended June 30, 2002, the Company sold 1,145,000 units
of its securities to accredited investors in a private placement at $0.25 per
unit, generating $286,250 of equity capital, which included accounts payable
of $10,000 paid through the issuance of such securities.  During the six
months ended June 30, 2002, the Company sold 2,294,000 units of its
securities to accredited investors in a private placement at $0.25 per unit,
generating $573,500 of equity capital, which included accounts payable of
$16,000 paid through the issuance of such securities.  Each unit consisted of
one share of common stock and one common stock purchase warrant.  The
warrants are exercisable at $0.50 per share for a period of 18 months from
the date of issuance.

Effective January 3, 2002, the Company entered into a consulting agreement
with a firm that provides for the issuance of 25,000 shares of common stock
per month.  During the three months and six months ended June 30, 2002, the
Company issued 75,000 shares and 150,000 shares to such firm.  The aggregate
fair market value of $36,500 and $61,250 was charged to operations during the
three months and six months ended June 30, 2002, respectively.

During the six months ended June 30, 2002, the Company issued 18,400 shares
of common stock as commissions with respect to the private placement.  The
shares were recorded at their par value of $0.08 per share and charged to
additional paid-in capital.

During the six months ended June 30, 2002, the Company issued 5,000 shares of
common stock as a consulting fee.  The aggregate fair market of $2,250 was
charged to operations during the six months ended June 30, 2002.

During the three months and six months ended June 30, 2002, the Company
issued 55,250 shares and 111,500 shares of common stock to its Chief
Executive Officer.  The shares were issued as bonus pursuant to a provision
of the Chief Executive Officer's employment agreement, which provides for the
issuance of 5% of the shares issued in a private placement.  The aggregate
fair market value of such shares of $26,860 and $52,173 was charged to
operations during the three months and six months ended June 30, 2002,
respectively.

On February 4, 2002, as part of the Company's 2002 compensation agreement
with its Vice President of Operations, the Company issued a warrant to
purchase 50,000 shares of common stock exercisable at $0.41 per share, which
was the fair market value on the date of grant, vesting if 2002 revenues from


                                      -14-
<PAGE>

the Company's Las Vegas Facility are at least equal to 2001 revenues.  As of
June 30, 2002, the Company determined that it was likely that this warrant
would vest.  Accordingly, the Company calculated the value of the warrant as
$32,500 pursuant to the Black-Scholes option pricing model, and is charging
this amount to operations over the nine month period ending December 31,
2002.


6.  New Business Venture

The Company is developing a new business venture to market and sell show
tickets from a site in Las Vegas, Nevada.  The new venture will be owned
equally by the Company and a third party.  The start-up of this new business
venture is subject to finalization of certain documentation and agreements.
There can be no assurances that this new business venture will ultimately be
successful.  The Company currently anticipates that this new business venture
will begin operations during the latter part of 2002.

During the three months ended June 30, 2002 and 2001, the Company incurred
$17,309 and $10,082, respectively, of costs related to the development of
this new business venture.  During the six months ended June 30, 2002 and
2001, the Company incurred $28,523 and $16,130, respectively, of costs
related to the development of this new business venture.


7.  Closure of New Jersey Ride Facility

During late June 2002, the Company closed its New Jersey ride facility, as a
result of unsatisfactory revenue production and a dispute with the landlord
over expense increases.  As a result, the Company wrote-off fixed assets
related to such ride facility and incurred certain other direct and immediate
costs related to such closure aggregating $119,023, which were charged to
operations effective June 30, 2002.  During the three months ended June 30,
2002 and 2001, the New Jersey ride facility accounted for $68,283 and
$82,035, respectively, or 12.0% and 13.7% of consolidated revenues,
respectively.  During the six months ended June 30, 2002 and 2001, the New
Jersey ride facility accounted for $156,934 and $170,237, respectively, or
14.2% and 14.7% of consolidated revenues, respectively.

At June 30, 2002, property and equipment included office and equipment and
equipment under capital leases related to the New Jersey ride facility with
an original cost of $46,255 and a depreciated cost of $23,507.  The Company
is pursuing opportunities to establish another Las Vegas ride facility in
order to utilize the equipment removed from the New Jersey site.  This effort
is expected to take several months to accomplish, and there can be no
assurances that the Company will ultimately be successful.  Should the
Company not be successful in establishing a new Las Vegas ride facility in
the next several months, the Company will write-off the property and
equipment removed from the New Jersey ride facility, to the extent that it
cannot be utilized in the Company's remaining operations.

During July 2002, the Company was named as a defendant in a lawsuit initiated
by the landlord of the New Jersey ride facility.  The lawsuit results from
the contractual relationship between the landlord and the Company.
Management believes that it has claims against the landlord sufficient to
offset any damages for which the Company may ultimately be found liable.
Management believes that it will be successful in its defense, and
accordingly, has not accrued for any expenses associated with this lawsuit.
The Company's financial statements do not include any adjustments for
recovery of claims against the landlord.

                                      -15-
<PAGE>


ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

Cautionary Statement Pursuant to Safe Harbor Provisions of the Private
Securities Litigation Reform Act of 1995:

This Quarterly Report on Form 10-QSB for the quarterly period ended June 30,
2002 contains "forward-looking" statements within the meaning of Section 27A
of the Securities Act of 1933, as amended, including statements that include
the words "believes", "expects", "anticipates", or similar expressions.
These forward-looking statements include, among others, statements concerning
the Company's expectations regarding its working capital requirements,
financing requirements, its business, growth prospects, competition and
results of operations, and other statements of expectations, beliefs, future
plans and strategies, anticipated events or trends, and similar expressions
concerning matters that are not historical facts.  The forward-looking
statements in this Quarterly Report on Form 10-QSB for the quarterly period
ended June 30, 2002 involve known and unknown risks, uncertainties and other
factors that could cause the actual results, performance or achievements of
the Company to differ materially from those expressed in or implied by the
forward-looking statements contained herein.


Overview:

The Company is in the business of developing and operating rides consisting
of 3-D motion simulator attractions and filmed entertainment that combines
projected three-dimensional action films of approximately four minutes in
duration with computer-controlled, hydraulically-mobilized capsules that are
programmed to move in concert with the on-screen action.  The Company's ride
facilities are located in Las Vegas, Nevada; Edmonton, Alberta, Canada; and
Atlanta, Georgia.

Because of the seasonal nature of tourist traffic, attendance patterns at
attractions may vary.  The degree of this seasonality varies among
attractions, depending on the nature of tourist and local traffic patterns at
a given location as well as the nature of entertainment alternatives
available to audiences.  The Company expects that attendance at its
facilities will be the highest during June through August (the height of the
tourist season) and lowest during January and February.  As a result, the
Company's results of operations at its facilities will depend upon revenues
generated from the peak tourist periods and any significant decrease in
revenues in such periods could have a material adverse effect upon the
Company's results of operations.


Going Concern:

The consolidated financial statements have been prepared assuming that the
Company will continue as a going concern, which contemplates the realization
of assets and the satisfaction of liabilities in the normal course of
business.  The carrying amounts of assets and liabilities presented in the
consolidated financial statements do not purport to represent the realizable
or settlement values.  The Company has experienced declining revenues and
recurring operating losses, and had a substantial working capital deficit at
June 30, 2002 and December 31, 2001.  The Company's independent certified
public accountants, in their independent auditors' report on the consolidated
financial statements as of and for the year ended December 31, 2001, have
expressed substantial doubt about the Company's ability to continue as a
going concern.

The Company will require additional capital to fund operating and debt
service requirements (see "Liquidity and Capital Resources - June 30, 2002"
below).  The Company has been exploring various alternatives to raise this


                                      -16-
<PAGE>

required capital and has raised a portion of the required capital, but there
can be no assurances that the Company will ultimately be successful in this
regard.  During the six months ended June 30, 2002, the Company raised
$557,500 of new capital through the sale of its equity securities.  The
private placement offering consisted of units sold at $0.25 per unit.  Each
unit consisted of one share of common stock and one common stock purchase
warrant.  The warrants are exercisable at $0.50 per share for a period of 18
months from the date of issuance.  The Company is continuing its efforts to
raise new capital subsequent to June 30, 2002.  The Company is attempting to
raise a total of up to $750,000 of new capital during 2002.

To the extent that the Company is unable to secure the capital necessary to
fund its future cash requirements on a timely basis and/or under acceptable
terms and conditions, the Company may not have sufficient cash resources to
maintain operations.  In such event, the Company may be required to consider
a formal or informal restructuring or reorganization.

From time to time the Company may also consider a wide range of other
business opportunities.  Some of these business opportunities may be
unrelated to the Company's current business activities, could require
additional capital, and could result in a change in control of the Company.


Closure of New Jersey Ride Facility:

During late June 2002, the Company closed its New Jersey ride facility, as a
result of unsatisfactory revenue production and a dispute with the landlord
over expense increases.  As a result, the Company wrote-off fixed assets
related to such ride facility and incurred certain other direct and immediate
costs related to such closure aggregating $119,023, which were charged to
operations effective June 30, 2002.  During the three months ended June 30,
2002 and 2001, the New Jersey ride facility accounted for $68,283 and
$82,035, respectively, or 12.0% and 13.7% of consolidated revenues,
respectively.  During the six months ended June 30, 2002 and 2001, the New
Jersey ride facility accounted for $156,934 and $170,237, respectively, or
14.2% and 14.7% of consolidated revenues, respectively.

At June 30, 2002, property and equipment included office and equipment and
equipment under capital leases related to the New Jersey ride facility with
an original cost of $46,255 and a net book value of $23,507.  The Company is
pursuing opportunities to establish another Las Vegas ride facility in order
to utilize the equipment removed from the New Jersey site.  This effort is
expected to take several months to accomplish, and there can be no assurances
that the Company will ultimately be successful.  Should the Company not be
successful in establishing a new Las Vegas ride facility in the next several
months, the Company will write-off the property and equipment removed from
the New Jersey ride facility, to the extent that it cannot be utilized in the
Company's remaining operations.

During July 2002, the Company was named as a defendant in a lawsuit initiated
by the landlord of the New Jersey ride facility.  The lawsuit results from
the contractual relationship between the landlord and the Company.
Management believes that it has claims against the landlord sufficient to
offset any damages for which the Company may ultimately be found liable.
Management believes that it will be successful in its defense, and
accordingly, has not accrued for any expenses associated with this lawsuit.
The Company's financial statements do not include any adjustments for
recovery of claims against the landlord.

                                      -17-
<PAGE>


New Business Venture:

The Company is developing a new business venture to market and sell show
tickets from a site in Las Vegas, Nevada.  The new venture will be owned
equally by the Company and a third party.  The start-up of this new business
venture is subject to finalization of certain documentation and agreements.
There can be no assurances that this new business venture will ultimately be
successful.  The Company currently anticipates that this new business venture
will begin operations during the latter part of 2002.

During the three months ended June 30, 2002 and 2001, the Company incurred
$17,309 and $10,082, respectively, of costs related to the development of
this new business venture.  During the six months ended June 30, 2002 and
2001, the Company incurred $28,523 and $16,130, respectively, of costs
related to the development of this new business venture.


Critical Accounting Policies:

The Company prepared the consolidated financial statements in accordance with
accounting principles generally accepted in the United States of America.
The preparation of these financial statements requires the use of estimates
and assumptions that affect the reported amounts of assets and liabilities
and the disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amount of revenues and expenses during
the reporting period.  Management periodically evaluates the estimates and
judgments made.  Management bases its estimates and judgments on historical
experience and on various factors that are believed to be reasonable under
the circumstances.  Actual results may differ from these estimates as a
result of different assumptions or conditions.

The following critical accounting policies affect the more significant
judgments and estimates used in the preparation of the Company's consolidated
financial statements.

Impairment of Long-Lived Assets:

The Company's long-lived assets include property and equipment and the visual
effects library.  At December 31, 2001, the net value of property and
equipment and the visual effects library was $1,039,346, which accounted for
68.1% of the Company's total assets.  At June 30, 2002, the net value of
property and equipment and the visual effects library was $787,554, which
accounted for 56.2% of the Company's total assets.  In assessing the
impairment of property and equipment and the visual effects library, the
Company makes assumptions regarding the estimated future cash flows and other
factors to determine the fair value of the respective assets.  If these
estimates or the related assumptions change in the future, the Company may be
required to record impairment charges for these assets.

Investment in Joint Venture:

The Company has a 50% interest in a joint venture with Dave & Buster's, Inc.
The value of the Company's investment in the joint venture was $323,795 at
December 31, 2001, representing 21.2% of the Company's total assets.  The
value of the Company's investment in the joint venture was $304,004 at June
30, 2002, representing 21.7% of the Company's total assets.  The Company
periodically evaluates the recoverability of its investment in the joint
venture based on the joint venture's current and prospective operating
performance.  If the Company determines that its investment in the joint
venture is not recoverable, it will be required to recognize a loss in such
period.

                                      -18-
<PAGE>

Income Taxes:

The Company records a valuation allowance to reduce its deferred tax assets
to the amount that is more likely than not to be realized.  In the event the
Company was to determine that it would be able to realize its deferred tax
assets in the future in excess of its recorded amount, an adjustment to the
deferred tax assets would be credited to operations in the period such
determination was made.  Likewise, should the Company determine that it would
not be able to realize all or part of its deferred tax assets in the future,
an adjustment to the deferred tax assets would be charged to operations in
the period such determination was made.


Results of Operations:

Three Months Ended June 30, 2002 and 2001 -

Revenues.  Revenues decreased by $31,509 or 5.2% to $569,423 in 2002, as
compared to $600,932 in 2001.  Included in revenues for the three months
ended June 30, 2002 and 2001 were revenues from the New Jersey ride facility,
which was closed in late June 2002, of $68,283 and $82,035, respectively, or
12.0% and 13.7% of total revenues.  Revenues for periods subsequent to June
30, 2002 will reflect the absence of revenues from the New Jersey ride
facility.

Direct Costs of Revenues.  Direct costs of revenues increased by $3,612 or
1.0% to $352,987 in 2002 from $349,375 in 2001 (excluding forgiveness of
accrued rent payable of $70,580 in 2001, which was credited to direct costs
of revenues).  Direct costs of revenues were 62.0% of revenues in 2002, as
compared to 58.1% of revenues in 2001 (excluding the forgiveness of accrued
rent payable), primarily as a result of the increasingly unsatisfactory
performance of the Company's New Jersey ride facility in 2002.  The New
Jersey ride facility was closed in late June 2002.

Selling and Marketing Expenses.  Selling and marketing expenses decreased by
$20,758 or 54.1% to $17,609 in 2002, as compared to $38,367 in 2001, as a
result of reduced use of marketing and promotional materials.  Selling and
marketing expenses were 3.1% of revenues in 2002, as compared to 6.4% of
revenues in 2001.

General and Administrative Expenses.  General and administrative expenses
increased by $80,580 or 27.1% to $377,422 in 2002, as compared to $296,842 in
2001.  Included in general and administrative expenses in 2002 and 2001 was
non-cash compensation of $74,193 and $24,465, respectively, including $37,693
and $12,600 to officers and directors, respectively.  Excluding such non-cash
compensation, general and administrative expenses increased by $30,852 or
11.3% in 2002 as compared to 2001, primarily as a result of higher costs for
liability insurance and professional fees.

Depreciation and Amortization.  Depreciation and amortization decreased by
$3,130 or 3.7% to $82,047 in 2002, as compared to $85,177 in 2001.

Start-Up Costs of New Business Venture.  The Company incurred start-up costs
with respect to the development of its new business venture of $17,309 in
2002, as compared to $10,082 in 2001.

Closure Costs of New Jersey Ride Facility.  During late June 2002, the
Company closed its New Jersey ride facility, as a result of unsatisfactory
revenue production and a dispute with the landlord over expense increases.
As a result, the Company wrote-off fixed assets related to such ride facility
and incurred certain other direct and immediate costs related to such closure


                                      -19-
<PAGE>

aggregating $119,023, which were charged to operations effective June 30,
2002.

Loss from Operations.  The loss from operations was $396,974 for the three
months ended June 30, 2002, as compared to a loss from operations of $108,331
for the three months ended June 30, 2001.

Interest Expense.  Interest expense increased by $32,003 to $39,637 in 2002,
as compared to $7,634 in 2001, primarily as a result of adjustments in 2001
that reduced interest expense, which were recorded in conjunction with the
restructuring of the note payable to the Company's primary secured lender in
June 2001.

Interest Income.  Interest income was $11 in 2002, as compared to $213 in
2001.

Equity in Net Income of Joint Venture.  Equity in net income of joint venture
was $1,693 in 2002, as compared to $3,350 in 2001.

Other Income.  Other income was $16,649 in 2002.  There was no other income
in 2001.

Net Loss.  Net loss was $418,258 the three months ended June 30, 2002, as
compared to a net loss of $112,402 for the three months ended June 30, 2001.


Six Months Ended June 30, 2002 and 2001 -

Revenues.  Revenues decreased by $54,238 or 4.7% to $1,103,885 in 2002, as
compared to $1,158,123 in 2001.  Included in revenues for the six months
ended June 30, 2002 and 2001 were revenues from the New Jersey ride facility,
which was closed in late June 2002, of $156,934 and $170,237, respectively,
or 14.2% and 14.7% of total revenues, respectively.  Revenues for periods
subsequent to June 30, 2002 will reflect the absence of revenues from the New
Jersey ride facility.

Direct Costs of Revenues.  Direct costs of revenues decreased by $36,786 or
5.2% to $672,990 in 2002 from $709,776 in 2001 (excluding forgiveness of
accrued rent payable of $70,580 in 2001, which was credited to direct costs
of revenues).  Direct costs of revenues were 61.0% of revenues in 2002, as
compared to 61.3% of revenues in 2001 (excluding the accrued rent payable).

Selling and Marketing Expenses.  Selling and marketing expenses decreased by
$46,885 or 56.6% to $35,953 in 2002, as compared to $82,838 in 2001, as a
result of reduced use of marketing and promotional materials.  Selling and
marketing expenses were 3.3% of revenues in 2002, as compared to 7.2% of
revenues in 2001.

General and Administrative Expenses.  General and administrative expenses
increased by $288,871 or 55.9% to $805,304 in 2002, as compared to $516,433
in 2001.  Included in general and administrative expenses in 2002 and 2001
was non-cash compensation of $257,756 and $24,465, respectively, including
$120,756 and $12,600 to officers and directors, respectively.  Excluding such
non-cash compensation, general and administrative expenses increased by
$52,580 or 10.7% in 2002 as compared to 2001, primarily as a result of higher
costs for liability insurance, professional fees and salaries.

Depreciation and Amortization.  Depreciation and amortization increased by
$2,862 or 1.7% to $173,112 in 2002, as compared to $170,250 in 2001.

Start-Up Costs of New Business Venture.  The Company incurred start-up costs


                                      -20-
<PAGE>

with respect to the development of its new business venture of $28,523 in
2002, as compared to $16,130 in 2001.

Closure Costs of New Jersey Ride Facility.  During late June 2002, the
Company closed its New Jersey ride facility, as a result of unsatisfactory
revenue production and a dispute with the landlord over expense increases.
As a result, the Company wrote-off fixed assets related to such ride facility
and incurred certain other direct and immediate costs related to such closure
aggregating $119,023, which were charged to operations effective June 30,
2002.

Loss from Operations.  The loss from operations was $731,020 for the six
months ended June 30, 2002, as compared to a loss from operations of $266,724
for the six months ended June 30, 2001.

Interest Expense.  Interest expense increased by $27,987 to $85,449 in 2002,
as compared to $57,462 in 2001, primarily as a result of adjustments in 2001
that reduced interest expense, which were recorded in conjunction with the
restructuring of the note payable to the Company's primary secured lender in
June 2001.

Interest Income.  Interest income was $33 in 2002, as compared to $598 in
2001.

Equity in Net Income of Joint Venture.  Equity in net income of joint venture
was $18,303 in 2002, as compared to $11,065 in 2001.

Other Income.  Other income was $16,649 in 2002.  There was no other income
in 2001.

Net Loss.  Net loss was $781,484 the six months ended June 30, 2002, as
compared to a net loss of $312,523 for the six months ended June 30, 2001.


Liquidity and Capital Resources - June 30, 2002:

During the last few years, the Company has relied on the proceeds from loans
from both unrelated and related parties and capital leases to provide the
resources necessary to develop its ride facilities and operate its business.
However, during the six months ended June 30, 2002, the Company raised
$557,500 of new capital through the sale of its securities, which has been
used to fund existing operations.  The Company is continuing its efforts to
raise new capital subsequent to June 30, 2002.  The Company is attempting to
raise a total of up to $750,000 of new capital during 2002.

Operating Activities.  The Company's operations utilized cash of $334,944
during the six months ended June 30, 2002, as compared to utilizing cash of
$18,164 during the six months ended June 30, 2001.  The increase in cash
utilized in operations in 2002 as compared to 2001 was primarily a result of
cash used to reduce accounts payable and accrued expense balances.

At June 30, 2002, cash and cash equivalents had increased by $166,330, to
$233,186, as compared to $66,856 at December 31, 2001.  The Company had a
working capital deficit of $251,066 at June 30, 2002, as compared to a
working capital deficit of $1,228,824 at December 31, 2001 (which included
the entire balance of the Company's note payable to its primary secured
lender of $780,613), resulting in current ratios of .52:1 and .08:1 at June
30, 2002 and December 31, 2001, respectively.  As a result of the completion
of a modification agreement with the primary secured lender effective April
17, 2002, the balance of this loan was reclassified at June 30, 2002, with
$107,695 presented as a current liability and $662,244 presented as a
long-term liability.

                                      -21-
<PAGE>

Investing Activities.  Net cash provided by investing activities was $163 and
$27,829 for the six months ended June 30, 2002 and 2001, respectively.
During the six months ended June 30, 2002 and 2001, the Company purchased
property and equipment of $37,931 and $247, respectively, and the Company
received dividends from the Company's joint venture with Dave & Buster's,
Inc. of $38,094 and $28,076, respectively.

Financing Activities.  Net cash provided by financing activities was $501,111
for the six months ended June 30, 2002, as compared to utilizing cash of
$35,268 for the six months ended June 30, 2001.  During the six months ended
June 30, 2002 and 2001, the Company made payments on notes payable of $26,009
and $11,797, respectively, and the Company made principal payments on capital
lease obligations of $30,380 and $23,471, respectively.

During the six months ended June 30, 2002, the Company converted $47,312 of
accounts payable into notes payable, and $16,000 of accounts payable into the
private placement securities.

During the six months ended June 30, 2002, the Company raised $557,500 of new
capital through the sale of its equity securities.  The private placement
offering consisted of units sold at $0.25 per unit.  Each unit consisted of
one share of common stock and one common stock purchase warrant.  The
warrants are exercisable at $0.50 per share for a period of 18 months from
the date of issuance.  The Company is continuing its efforts to raise new
capital subsequent to June 30, 2002.  The Company is attempting to raise a
total of up to $750,000 of new capital during 2002.


Transactions with Secured Lender:

On December 31, 1996, the Company completed a financing agreement with Finova
Technology Finance, Inc., which was structured as a sale-leaseback
transaction of certain equipment owned by the Company.  Based on the
substance of this transaction, this financing agreement was accounted for as
a note payable for financial reporting purposes.  The gross loan amount was
$1,575,027, repayable over a four year period at $40,903 per month with a
balloon payment of $157,503.  On March 10, 1999, the financing agreement was
amended to reduce the monthly payments from $40,903 to $21,789, and to extend
the maturity date from January 1, 2001 to January 1, 2004, with no change in
the balloon payment of $157,503.  The loan bore interest at 16.75% per
annum.  The financing agreement requires the Company to repurchase the
equipment at the end of the lease for $1.00.

Effective June 25, 2001, the Company completed a Second Modification
Agreement and Waiver of Defaults with the secured lender, which provided
for:  (1) the waiver of all prior payment defaults; (2) the reduction of the
monthly payment from $21,789 to $10,674, which represents interest only
payments at 16.75% per annum; (3) the increase in the principal balance due
the lender of accrued interest payable of $50,083; (4) the acceleration of
the due date of the loan from January 1, 2004 to March 1, 2002; (5) the
repricing of a common stock purchase warrant previously issued to the lender
to purchase 12,500 shares of common stock exercisable through December 31,
2003, which reduced the exercise price from $16.00 per share to $1.00 per
share; (6) the issuance of common stock purchase warrants to the lender to
purchase 25,000 shares of common stock at $0.50 per share and 25,000 shares
of common stock at $1.00 per share exercisable through June 25, 2011; and (7)
the revision of the lender's Warrant Holder Rights Agreement to eliminate
demand registration rights.

The Company calculated the fair value of the warrants to purchase an


                                      -22-
<PAGE>

aggregate of 50,000 shares of common stock and the repricing of the warrant
to purchase 12,500 shares of common stock pursuant to the Black-Scholes
option pricing model.  The aggregate fair value of $47,250 was recorded as
deferred financing costs, and was charged to operations as financing expense
through March 1, 2002.  In addition, previously recorded deferred financing
costs were charged to operations as financing expense through the accelerated
due date of the loan of March 1, 2002.

The balance of this loan was $780,613 at December 31, 2001.  As a result of
this loan being due in full on March 1, 2002, the Company classified the
entire obligation to the secured lender as a current liability in the
consolidated financial statements at December 31, 2001.  Required monthly
payments on such loan were in arrears at December 31, 2000 and 2001, and the
Company did not make the balloon payment due on March 1, 2002.

Effective April 17, 2002, the Company completed a Third Modification
Agreement and Waiver of Defaults with the secured lender, which provided
for:  (1) the waiver of all prior payment defaults; (2) interest on the
unpaid balance at 16.64% per annum; (3) the payment of interest only for the
months of March, April and May 2002; (4) commencing June 2002, monthly
payments of principal and interest of $18,955 for a period of five years.  As
a result of the completion of this agreement, the balance of this loan was
reclassified at June 30, 2002, with $107,695 classified as a current
liability and $662,244 classified as a long-term liability.


New Accounting Pronouncements:

In June 2001, the FASB issued SFAS No. 142, "Goodwill and Other Intangible
Assets", which is effective January 1, 2002.  SFAS No. 142 requires, among
other things, the discontinuance of goodwill amortization.  In addition, SFAS
No. 142 includes provisions for the reclassification of certain existing
recognized intangibles as goodwill, reassessment of the useful lives of the
existing recognized intangibles, reclassification of certain intangibles out
of previously reported goodwill and the identification of reporting units for
purposes of assessing potential future impairments of goodwill.  SFAS No. 142
also requires the Company to complete a transitional goodwill impairment test
six months from the date of adoption.  The Company does not expect that the
adoption of SFAS No. 142 will have any impact on the Company's financial
statement presentation or disclosures.

In August 2001, the FASB issued SFAS No. 143, "Accounting for Asset
Retirement Obligations".  This statement addresses the diverse accounting
practices for obligations associated with the retirement of tangible
long-lived assets and the associated asset retirement costs.  The Company
will be required to adopt this statement effective January 1, 2003.  The
Company is reviewing SFAS No. 143 to determine what effect, if any, it will
have on its financial statement presentation or disclosures.

In August 2001, the FASB issued SFAS No. 144, "Accounting for the Impairment
or Disposal of Long-Lived Assets", which is effective January 1, 2002.  SFAS
No. 144 supersedes SFAS No. 121, "Accounting for the Impairment of Long-Lived
Assets and for Long-Lived Assets to Be Disposed Of", and a portion of APB
Opinion No. 30, "Reporting the Results of Operations".  This statement
provides a single accounting model for long-lived assets to be disposed of
and significantly changes the criteria that would have to be met to classify
an asset as held-for-sale.  Classification as held-for-sale is an important
distinction since such assets are not depreciated and are stated at the lower
of fair value and carrying amount.  This statement also requires expected
future operating losses from discontinued operations to be displayed in the
period(s) in which the losses are incurred, rather than as of the measurement


                                      -23-
<PAGE>

date as presently required.  The Company does not anticipate that the
adoption of SFAS No. 144 will have a material effect on the Company's
financial statement presentation or disclosures.


                                      -24-
<PAGE>


                          PART II. OTHER INFORMATION


ITEM 1.  LEGAL PROCEEDINGS

The Company's former Chief Financial Officer, Toufic R. Bassil, has asserted
claims against the Company for breach of his employment agreement and his
wrongful termination as an officer of the Company without cause effective
March 1, 1999.  These claims are being asserted pursuant to a binding
arbitration proceeding through the American Arbitration Association.
Although the arbitrator has determined that the Company is liable for damages
from breach of the employment agreement, damages have not yet been
determined.  The wrongful termination claim is still in the discovery stage
and the Company is actively defending this matter.  In the opinion of
management, adequate provision has been made in the consolidated financial
statements with respect to the foregoing claims.

During July 2002, the Company was named as a defendant in a lawsuit initiated
by the landlord of the New Jersey ride facility.  During late June 2002, the
Company closed its New Jersey ride facility, as a result of unsatisfactory
revenue production and a dispute with the landlord over expense increases.
Management believes that it has claims against the landlord sufficient to
offset any damages for which the Company may be ultimately found liable.
Management believes that it will be successful in its defense, and
accordingly, has not accrued for any expenses associated with this lawsuit.
The Company's financial statements do not include any adjustments for
recovery of claims against the landlord.


ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS

During the three months ended June 30, 2002, the Company sold 1,145,000 units
of its securities to accredited investors in a private placement at $0.25 per
unit, generating $286,500 of equity capital, which included accounts payable
of $10,000 paid through the issuance of such securities.  Each unit consisted
of one share of common stock and one common stock purchase warrant.  The
warrants are exercisable at $0.50 per share for a period of 18 months from
the date of issuance.

Effective January 3, 2002, the Company entered into a consulting agreement
with a firm that provides for the issuance of 25,000 shares of common stock
per month.  During the three months ended June 30, 2002, the Company issued
75,000 shares to such firm.  The aggregate fair market value of $36,500 was
charged to operations during the three months ended June 30, 2002.

During the three months ended June 30, 2002, the Company issued 55,250 shares
of common stock to its Chief Executive Officer.  The shares were issued as a
bonus pursuant to a provision of the Chief Executive Officer's employment
agreement, which provides for the issuance of 5% of the shares issued in a
private placement.  The aggregate fair market value of such shares of $26,860
was charged to operations during the three months ended June 30, 2002.

On February 4, 2002, as part of the Company's 2002 compensation agreement
with its Vice President of Operations, the Company issued a warrant to
purchase 50,000 shares of common stock exercisable at $0.41 per share, which
was the fair market value on the date of grant, vesting if 2002 revenues from
the Company's Las Vegas Facility are at least equal to 2001 revenues.  As of
June 30, 2002, the Company determined that it was likely that this warrant
would vest.  Accordingly, the Company calculated the value of the warrant as
$32,500 pursuant to the Black-Scholes option pricing model, and is charging
this amount to operations over the nine month period ending December 31,
2002.

                                      -25-
<PAGE>

The shares of common stock and warrants were issued without registration in
reliance upon the exemption afforded by Section 4(2) of the Securities Act of
1933, as amended, based on certain representations made to the Company by the
recipients.


ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

      (a) Exhibits:

          A list of exhibits required to be filed as part of this report is
          set forth in the Index to Exhibits, which immediately precedes such
          exhibits, and is incorporated herein by reference.

      (b) Reports on Form 8-K:

          Three Months Ended June 30, 2002 -

          On July 10, 2002, the Company filed a Current Report on Form 8-K,
          which included a news release dated July 3, 2002, incorporated as
          Exhibit 20.1, reporting that the Company closed its New Jersey ride
          facility in late June 2002.


                                      -26-
<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.



                                       CINEMA RIDE, INC.
                                       -----------------
                                          (Registrant)


                                       /s/ MITCHELL J. FRANCIS
Date:  August 15, 2002            By:  __________________________
                                       Mitchell J. Francis
                                       Chief Executive Officer,
                                       President, Chief Financial
                                       Officer and Chairman of
                                       the Board of Directors
                                       (Duly Authorized Officer
                                       and Chief Financial
                                       Officer)


                                      -27-
<PAGE>



                              INDEX TO EXHIBITS



Exhibit
Number       Description of Document
------       -----------------------

99.1         Certification Pursuant to Section 906 of the
             Sarbanes-Oxley Act of 2002




                                      -28-