<PAGE>

================================================================================
================================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C.  20549

                                   FORM 10-Q
                Quarterly Report Pursuant to Section 13 or 15(d)
                     of the Securities Exchange Act of 1934

For the quarterly period ended March 31, 2001      Commission File No. 001-14509

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


           Delaware                                                   33-0811505
(State or other jurisdiction of                                 (I.R.S. Employer
incorporation or organization)                            Identification Number)


              28210 Dorothy Drive, Agoura Hills, California 91301
              (Address of principal executive offices) (Zip Code)

       Registrant's telephone number, including area code: (818) 889-8740

          Securities registered pursuant to Section 12(b) of the Act:
                    Common Stock, par value $.001 per share

          Securities registered pursuant to Section 12(g) of the Act:
                                 Not Applicable

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

Yes  X          No
    ---            ---


  There were 25,308,112 shares of outstanding Common Stock of the Registrant as
of May 2, 2001.

================================================================================
================================================================================
<PAGE>

PART I -- FINANCIAL INFORMATION
-------------------------------

Item 1.  Financial Statements

EASYRIDERS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                           March 31,                       December 31,
                                                                             2001                              2000
                                                                          ---------------------------------------------
                                                                          (unaudited)
<S>                                                                       <C>                          <C>
ASSETS

CURRENT ASSETS:
Cash and cash equivalents                                                 $   604,995                       $   192,492
Accounts receivable, less allowance for doubtful accounts
  of $872,864 (2001) and $882,234 (2000)                                    2,416,101                         2,008,505
Inventories                                                                 1,880,754                         2,177,344
Prepaid publication costs                                                     883,924                           819,210
Prepaid expenses and other                                                    787,584                           849,844
Receivable from shareholder                                                   278,324                           278,374
                                                                          -----------                       -----------

    Total current assets                                                    6,851,682                         6,325,769

PROPERTY AND EQUIPMENT, net                                                   791,921                           841,158

GOODWILL, net of accumulated amortization of
  $4,468,625 (2001) and $4,194,289 (2000)                                  25,982,688                        26,257,024

OTHER ASSETS                                                                  152,778                           172,670
                                                                          -----------                       -----------

                                                                          $33,779,069                       $33,596,621
                                                                          ===========                       ===========
</TABLE>

          See accompanying notes to consolidated financial statements.

                                       1
<PAGE>

EASYRIDERS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (Continued)

<TABLE>
<CAPTION>
                                                                            March 31,                   December 31,
                                                                              2001                          2000
                                                                           ------------                --------------
                                                                           (unaudited)
<S>                                                                        <C>                         <C>
LIABILITIES AND STOCKHOLDERS' DEFICIT

CURRENT LIABILITIES:
Accounts payable                                                           $  3,814,439                $  5,237,813
Accrued payroll and payroll related expenses                                    244,569                   1,204,786
Accrued interest payable                                                        710,300                     563,963
Other current liabilities                                                     1,198,055                   1,528,143
Income taxes payable                                                             27,800                      17,900
Current portion of deferred subscription and advertising income               4,841,873                   3,941,853
Note payable                                                                    250,000                           -
Current portion of long-term debt                                            21,851,835                  21,832,113
                                                                           ------------                ------------

    Total current liabilities                                                32,938,871                  34,326,571
                                                                           ------------                ------------

NOTE PAYABLE TO STOCKHOLDER                                                   8,000,000                   8,000,000

LONG-TERM DEBT, net of current portion and debt discount                        366,741                     571,165

OTHER LONG-TERM LIABILITIES, including deferred
  subscription revenues of $1,530,105 (2001) and $1,477,385
  (2000)                                                                      2,483,005                   3,529,359

REDEEMABLE COMMON STOCK (NOTE 3)                                                500,000                           -

STOCKHOLDERS' DEFICIT:
Preferred stock, par value $.001 per share; 10,000,000 shares
  authorized, none outstanding                                                        -                           -
Common stock, par value $.001 per share; 50,000,000 shares
  authorized, 28,590,702 shares (2001 and 2000) outstanding                      28,590                      28,590
Additional paid in capital                                                   64,717,885                  64,611,943
Receivable from the sale of stock, less allowance for doubtful
 account of $5,100,000 (2000)                                                         -                  (2,200,000)
Accumulated deficit                                                         (74,356,023)                (75,271,007)
Treasury stock, 4,500,000 shares of common stock at cost                       (900,000)                          -
                                                                           ------------                ------------

    Total stockholders' deficit                                             (10,509,548)                (12,830,474)
                                                                           ------------                ------------

                                                                           $ 33,779,069                $ 33,596,621
                                                                           ============                ============
</TABLE>

          See accompanying notes to consolidated financial statements.

                                       2
<PAGE>

EASYRIDERS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
                                                                                            For the Three Months Ended
                                                                                                     March 31,
                                                                                           2001                      2000
                                                                                       --------------------------------------
                                                                                                    (unaudited)
<S>                                                                                    <C>                       <C>

CONTINUING OPERATIONS:
SALES                                                                                  $ 8,293,165               $ 8,405,439

COST OF SALES                                                                            5,453,498                 6,796,737
                                                                                       -----------               -----------

GROSS MARGIN                                                                             2,839,667                 1,608,702

EXPENSES:
Selling, general and administrative                                                        609,620                 1,444,724
Depreciation and amortization                                                              358,464                   593,042
Stock issuance expenses                                                                          -                   173,242
                                                                                       -----------               -----------

    Total expenses                                                                         968,084                 2,211,008
                                                                                       -----------               -----------

INCOME (LOSS) FROM OPERATIONS                                                            1,871,583                  (602,306)

OTHER INCOME (EXPENSE)                                                                      50,210                    70,148
INTEREST EXPENSE                                                                          (990,384)                 (976,638)
                                                                                       -----------               -----------

INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES                                            931,409                (1,508,796)

PROVISION FOR INCOME TAXES                                                                  16,425                     7,851
                                                                                       -----------               -----------

NET INCOME (LOSS) FROM CONTINUING OPERATIONS                                               914,984                (1,516,647)

INCOME (LOSS) FROM DISCONTINUED OPERATIONS                                                       -                   133,529
                                                                                       -----------               -----------

NET INCOME (LOSS)                                                                      $   914,984               $(1,383,118)
                                                                                       ===========               ===========

NET INCOME (LOSS) PER SHARE - BASIC
  CONTINUING OPERATIONS                                                                $      0.03               $     (0.06)
  DISCONTINUED OPERATIONS                                                                        -                         -
                                                                                       -----------               -----------
  NET INCOME (LOSS) PER SHARE                                                          $      0.03               $     (0.06)
                                                                                       ===========               ===========

NET INCOME (LOSS) PER SHARE - DILUTED
  CONTINUING OPERATIONS                                                                $      0.03               $     (0.06)
  DISCONTINUED OPERATIONS                                                                        -                         -
                                                                                       -----------               -----------
  NET INCOME (LOSS) PER SHARE                                                          $      0.03               $     (0.06)
                                                                                       ===========               ===========

WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING -
  BASIC                                                                                 28,540,702                23,698,835
                                                                                       ===========               ===========
  DILUTED                                                                               31,061,211                23,698,835
                                                                                       ===========               ===========
</TABLE>

          See accompanying notes to consolidated financial statements.

                                       3
<PAGE>

EASYRIDERS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                                For the Three Months Ended
                                                                                         March 31,
                                                                                      2001              2000
                                                                               -----------------------------
                                                                                        (unaudited)
<S>                                                                            <C>               <C>
CONTINUING OPERATIONS:
CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES:
Net Income (Loss)                                                              $   914,984       $(1,516,647)
Adjustments to reconcile net income (loss) to cash provided by (used in)
 operating activities:
  Stock issuance expenses                                                                -           173,242
  Common stock issued for services                                                   5,442                 -
  Common stock issued for interest                                                       -            19,726
  Depreciation and amortization                                                    358,464           593,042
  Loss on sale of fixed assets                                                           -            55,072
  Gain on Martin Unwind (Note 4)                                                   (47,167)                -
  Amortization of debt issuance costs                                               78,693            78,694
  Non-cash interest expense                                                        100,500                 -
  Increase (decrease) in cash resulting from changes in operating accounts:
    Current assets                                                                (113,410)       (1,525,368)
    Other assets                                                                         -            22,041
    Current liabilities                                                         (1,167,978)          208,900
    Other long-term liabilities                                                    182,677         1,310,917
                                                                               -----------       -----------
Net cash provided by (used in) operating activities                                312,205          (580,381)

CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sale of fixed assets                                                       -            10,000
Purchase of fixed assets                                                           (15,000)          (20,710)
                                                                               -----------       -----------
      Net cash used in investing activities                                        (15,000)          (10,710)

CASH FLOWS FROM FINANCING ACTIVITIES:
Issuance of debt                                                                         -           325,000
Payment of long-term debt and capital leases                                      (184,702)         (189,412)
Proceeds from stockholders' and other advances                                     300,000                 -
Common stock issued for cash                                                             -           500,000
                                                                               -----------       -----------
      Net cash provided by financing activities                                    115,298           635,588
                                                                               -----------       -----------

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                           $   412,503       $    44,497

CASH AND CASH EQUIVALENTS, beginning of year                                       192,492           429,256
                                                                               -----------       -----------
CASH AND CASH EQUIVALENTS, end of year                                         $   604,995       $   473,753
                                                                               ===========       ===========

SUPPLEMENTAL CASH FLOW INFORMATION:
  Cash paid for interest                                                       $   451,095       $   423,971
                                                                               ===========       ===========

NON-CASH FINANCING ACTIVITIES:
Common stock issued in settlement of litigation                                $         -       $   325,000
                                                                               ===========       ===========
Redeemable common stock issued in settlement of accrued liability (Note 3)     $   155,000       $         -
                                                                               ===========       ===========
Conversion of accrued liability to note payable (Note 3)                       $   250,000       $         -
                                                                               ===========       ===========
</TABLE>

          See accompanying notes to consolidated financial statements

                                       4
<PAGE>

EASYRIDERS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTH PERIODS ENDED MARCH 31, 2001 AND 2000 (unaudited)
--------------------------------------------------------------------------------

1.  GENERAL BASIS OF PRESENTATION

    Easyriders, Inc. (Easyriders or the Company) was incorporated in the State
    of Delaware on May 13, 1998, and for financial reporting purposes is the
    successor to Newriders, Inc.  On September 23, 1998, Easyriders, Inc.
    consummated a series of transactions (collectively, the Reorganization),
    including the following:  (i) the merger of a subsidiary of Easyriders with
    and into Newriders, Inc. (Newriders) (the Merger) upon which the
    shareholders of Newriders exchanged their stock on a 2-for-1 basis for
    Easyriders, Inc. common stock; (ii) the acquisition by Easyriders of all of
    the outstanding common stock of Paisano Publications, Inc. (Paisano
    Publications), a California corporation, and certain affiliated corporations
    (collectively, the Paisano Companies); and (iii) the acquisition by
    Easyriders of all of the outstanding membership interests of M&B
    Restaurants, L.C. (El Paso), a Texas limited liability company.

    As a result of the merger, the Newriders common stock was exchanged for
    Easyriders common stock on the basis of one share of Easyriders common stock
    for each two shares of Newriders common stock, and the stockholders of
    Newriders immediately prior to the merger became stockholders of Easyriders.
    The merger was accounted for as a combination of entities under common
    control, similar to a pooling of interest.  Therefore, the historical
    financial statements represent the combined financial statements of
    Easyriders and Newriders.  The acquisitions of the Paisano Companies and El
    Paso were accounted for as a purchase.

    The Paisano Companies consist of Paisano Publications; Easyriders of
    Columbus, Inc., an Ohio corporation; Easyriders Franchising, Inc., a
    California corporation; Teresi, Inc. (DBA Easyriders Events, Inc.), a
    California corporation; Bros Club, Inc., a California corporation and
    Associated Rodeo Riders on Wheels, a California corporation; Paisano
    Publications publishes 11 special-interest magazines directed to motorcycle,
    hot-rod, and tattoo enthusiasts, and 2 industry related magazines, Eagles
    Eye and Tatoo Industry.  Other Paisano Companies market a line of apparel
    and other products designed to appeal to motorcycle, hot-rod, and tattoo
    enthusiasts.  Through the end of 1999 Easyriders Franchising had established
    franchise stores that sold Easyriders apparel, customized new and used
    American-made motorcycles, and motorcycle accessories.  Subsequently, all
    but 2 franchisees signed agreements converting their franchise arrangement
    to a licensing arrangement and the operations of Easyriders Franchising were
    assumed by Easyriders Licensing, Inc., a California corporation, and a
    wholly-owned subsidiary of Newriders.  Currently, there are 41 licensed
    stores and 1 retail store still operating as a franchise.

    El Paso is a Texas limited liability company, which owns and operates
    barbecue and smoked meat restaurants located in Arizona and Oklahoma.  The
    restaurants are operated under the name "El Paso Bar-B-Que."   On October 5,
    2000, the Company sold its interest in El Paso to a related party.

    Easyriders currently derives substantially all of its revenues from the
    operations of Paisano Publications.

    Basis of presentation - The accompanying unaudited interim consolidated
    financial statements of Easyriders, Inc. for the three month periods ended
    March 31, 2001 and 2000, respectively, reflect all adjustments (consisting
    of normal recurring accruals) which, in the opinion of management, are
    necessary for a fair presentation of the results for the interim periods
    presented. These financial statements have been prepared in accordance with
    the instructions to Form 10-Q and Article 10 of

                                       5
<PAGE>

EASYRIDERS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTH PERIODS ENDED MARCH 31, 2001 AND 2000 (unaudited)
--------------------------------------------------------------------------------

    Regulation S-X.  Accordingly, they do not include all of the information and
    footnotes required by generally accepted accounting principles for complete
    financial statements.

    These financial statements should be read in conjunction with the Company's
    annual audited financial statements for the year ended December 31, 2000.

    Operating results for the three month period ended March 31, 2001 are not
    necessarily indicative of the results that may be expected for the full year
    ending December 31, 2001.

    Reclassifications - Certain reclassifications have been made to the 2000
    financial statements in order to conform them to the 2001 presentation.

2.  LONG-TERM DEBT

    The Nomura Indebtedness - As of December 31, 2000, the Company was not in
    compliance with certain of the financial ratio covenants of the Nomura
    Credit Agreement, and as of March 1, 2001 was not in compliance with certain
    technical compliance provisions of such Agreement. Because of such non-
    compliance, Nomura notified the Company of its intent to enforce certain
    remedies provided for in the Nomura Credit Agreement, including the
    imposition of a "Default Rate" of interest and controls over cash
    disbursements. The Company has not assented to such demands and does not
    believe that such remedies are appropriate in light of its current financial
    condition.

    The Company has sought waivers from Nomura with respect to such non-
    compliance, and has endeavored to engage Nomura in a discussion concerning
    modifications of the Nomura Credit Agreement to accommodate the Company's
    realistic compliance capabilities. Such efforts have been unwelcomed by
    Nomura. In March 2001, representatives from Nomura conducted an audit of the
    Company's books and records. Since then, there has been no resolution of any
    of the outstanding default issues. However, the Company remains in
    compliance with all monthly financial payment obligations due Nomura under
    the Nomura Credit Agreement.

    The principal of the Nomura Indebtedness, approximately $21.1 million,
    becomes due and payable on September 23, 2001. In this regard, the Company
    is presently in the process of attempting to refinance the obligation, and
    also has requested that Nomura consent to an extension of the Nomura
    Indebtedness. Thus far, Nomura has declined such request.

    The Siena Loan - On April 13, 2000, Mr. Martin and Mr. Teresi each paid to
    Siena the sum of $137,500 and assumed the position of Siena with respect to
    the Siena Loan, with some modifications to the terms. For the quarter ended
    March 31, 2001, the Company did not possess the resources to pay off this
    $275,000 loan from Messrs. Teresi and Martin. As a result, as provided under
    the modified terms, through March 13, 2001 an additional 225,000 warrants
    vested to each of Mr. Martin and Mr. Teresi and the fair value of the
    warrants, aggregating $100,500, has been recorded as interest expense.
    Effective March 30, 2001, in connection with the Martin Unwind transaction
    (see Note 4 - Stockholders' Deficit), Mr. Teresi purchased Mr.
    Martin's one-half interest in the Siena Loan, and all warrants vested
    thereunder, for cash in the amount of $137,500.

                                       6
<PAGE>

EASYRIDERS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTH PERIODS ENDED MARCH 31, 2001 AND 2000 (unaudited)
--------------------------------------------------------------------------------

3.  REDEEMABLE COMMON STOCK

    On February 1, 2001, the Company entered into a settlement agreement with a
    law firm which had provided litigation defense services regarding accrued
    legal fees and expenses for total consideration of approximately $750,000.
    The settlement included the delivery of a promissory note for $250,000,
    which bears interest at the rate of 10% per annum and is due and payable in
    full on April 30, 2001, and the issuance of 500,000 shares of Easyriders,
    Inc, common stock. Under the terms of this agreement, on or after December
    1, 2002, the law firm has the right to cause Easyriders to purchase any or
    all of the eligible shares at a price of $1.00 per share. As a result of the
    put option held by the law firm, the mandatory redemption value of $500,000
    has been classified as redeemable common stock. The fair market value of the
    500,000 shares issued under this agreement approximated $155,000 on the
    settlement date, or $0.31 per share.

4.  STOCKHOLDERS' DEFICIT

    Related-Party Receivable from the sale of Stock - Soon after the El Paso
    Transaction, and as a consequence thereof, the Board of Directors and the
    Company's Chairman, John Martin, began negotiating the terms and conditions
    of a transaction which has become known as the "Martin Unwind," pursuant to
    which Mr. Martin would resign as Chairman.  Such negotiations concluded on
    March 1, 2001, when the Company and Mr. Martin entered into a Settlement
    Agreement (the "Martin Settlement").  Concurrently, Mr. Martin and the
    Company's principal shareholder and a director, Joseph Teresi, entered into
    a separate agreement concerning the purchase by Mr. Teresi of certain assets
    of Mr. Martin (the "Martin Asset Purchase").

    These transactions involved (a) Mr. Martin's employment agreement with the
    Company (the "Martin Employment Agreement"), (b) the Company's 1998
    Executive Incentive Compensation Plan (the "Compensation Plan"), (c) a
    limited-recourse promissory note in the principal amount of $5,000,000 owed
    by the Company to Mr. Teresi (the "Teresi Note"), which is secured by a
    full-recourse promissory note in the principal amount of $5,000,000 owed by
    Mr. Martin to the Company (the "Martin Mirror Note"), (d) a promissory note
    in the principal sum of $2,300,000 owed by Mr. Martin to the Company (the
    "Martin Note"), (e) 6,000,000 shares of the Company's common stock, of which
    2,395,823 were acquired by Martin through the issuance of the Martin Mirror
    Note and the Martin Note, and (f) a promissory note in the principal sum of
    $275,000 originally owed by the Company to Siena Capital Partners, LLC, (the
    "Siena Note"), which note was subsequently sold to Mr. Martin and Mr.
    Teresi, each as to a one-half interest.

    Pursuant to the Martin Settlement and the Martin Asset Purchase:

     .    Mr. Martin resigned as a director and Chairman of the Board, effective
          March 1, 2001. Concurrently, the other designated directors, William
          Prather, Wayne Knyal and Daniel Gallery, also resigned.

     .    Mr. Martin agreed to offset all amounts due to him from the Company,
          to waive future entitlements to receive salary payments under the
          Martin Employment Agreement, and to waive the right to receive accrued
          and future bonus payments under the Compensation Plan.

                                       7
<PAGE>

EASYRIDERS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTH PERIODS ENDED MARCH 31, 2001 AND 2000 (unaudited)
--------------------------------------------------------------------------------

     .    The Company canceled the Martin Mirror Note and reduced the balance
          due under the Martin Note to $1,200,000 (the "Adjusted Balance").
          During the year ended December 31, 2000, the Company wrote-off $5.1
          million of the Martin Mirror Note.

     .    Effective March 30, 2001, Mr. Martin paid the Adjusted Balance to the
          Company, through (a) the surrender to the Company, for cancellation
          and retirement, of 4.5 million shares of the Company's common stock
          held by him (valued at $0.20 per share or $900,000), and payment of
          $300,000 in cash.

     .    Effective March 30, 2001, Mr. Teresi agreed to the cancellation of the
          Martin Mirror Note and as to the Teresi Note, Mr. Martin provided Mr.
          Teresi with a limited personal guarantee up to $3,000,000.

     .    Effective March 30, 2001, Mr. Teresi purchased from Mr. Martin, (a)
          1,500,000 shares of the Company's common stock held by Mr. Martin for
          cash in the amount of $300,000, and (b) Mr. Martin's one-half interest
          in the Siena Note, and all warrants vested thereunder, for cash in the
          amount of $137,500.

    Stock Option Grants - During the three months ended March 31, 2001, there
    were no stock option grants.

5.  LONG-TERM LICENSE AGREEMENT

    Wholesale Product Sales and License Agreement - Effective March 28, 2001,
    the Company, through its subsidiaries Paisano Publications, Inc. and
    Easyriders Licensing, Inc. entered into a long-term license agreement (the
    "Products Agreement") with Southern Steel Sportswear, Inc. ("SSS"), an
    affiliate of Action Promotions, Inc., of Ormond Beach, Florida ("API"), in
    connection with the Company's wholesale products division. The Company has
    previously reported that in March 2000, it entered into a long-term license
    agreement with API, in connection with the activities of its subsidiary,
    Easyriders Events (the "Events Transaction"). Pursuant to the Events
    Transaction, API acquired a merchandise purchase credit which as of March
    28, 2001 amounted to $1,360,195 (the "API Credit").

    Under the Products Agreement, the Company has outsourced to SSS all
    activities pertaining to the design, manufacture, warehousing, shipping and
    fulfillment of orders in connection with the sale of Easyriders-branded
    apparel and related merchandise to its network of retail stores, each of
    which (an "Easyriders Store") conducts business as "Easyriders of _____"
    pursuant to a written license agreement, and through other retail
    motorcycle-oriented stores. (See "Information about Easyriders Licensing,"
    herein.) The Products Agreement is for a term of 10 years, with options to
    renew for two additional 10-year terms. Pursuant to the Products Agreement,
    the Company retains control over all other channels of distribution,
    including direct sales via its Roadware catalog and Internet Web site, and
    licensing of product opportunities to independent third parties (the "Retail
    Channel").

    The Products Agreement provides for an initial product inventory purchase of
    $760,195, and the purchase of delivery and transition services, licensing
    rights, customer lists, promotional support and related goods and services,
    all valued at $600,000.  The total of these figures, $1,360,195 was paid by
    SSS via cancellation of the API Credit. During the quarter ended March 31,
    2001, the

                                       8
<PAGE>

EASYRIDERS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTH PERIODS ENDED MARCH 31, 2001 AND 2000 (unaudited)
--------------------------------------------------------------------------------

    Company recognized approximately $585,000 of revenues from products sold and
    $500,000 from services rendered in relation to the delivery of products,
    transition support services, customer lists, and promotional support.  The
    remaining balance of $275,000 is included in deferred revenues on the
    accompanying consolidated balance sheet, of which, $100,000 will be
    amortized straight line over the license period of 10 years and $175,000
    will be recognized upon shipment of products during the second quarter.

6.  BUSINESS SEGMENTS

    Information by Operating Segment - Operating segments are defined as
    components of an enterprise for which separate financial information is
    available that is evaluated regularly by the chief operating decision-maker,
    or decision-making group, in deciding how to allocate resources and in
    assessing performance.  The Easyriders, Inc. chief operating decision-making
    group is comprised of the chief executive officer and the officers who
    report to him directly.

    Easyriders Inc. has four reportable segments: publishing, goods and
    services, franchising/licensing (only one store is still operating as a
    franchisee), and other events and operations.  The publishing segment
    includes magazine and catalog publishing and other operations.  The trade
    goods and services segment distributes motorcycle apparel and other related
    goods to both intermediate and end-users and offers motorcycle repair and
    services through a formerly owned Company store.  The franchising/licensing
    segment includes the franchising/licensing of Easyriders motorcycle stores
    for distribution of equipment and apparel.  The other events and operations
    segment includes the coordination and sponsorship of motorcycle related
    events and operations.

    Easyriders, Inc. evaluates performance based on profit or loss from
    operations before income taxes, not including nonrecurring gains and losses
    and foreign exchange gains and losses.  (The Company utilizes the other
    events and operations segment as a venue for increased exposure for
    publication sales.)  The accounting policies of the operating segments are
    the same as those described in the summary of significant accounting
    policies. The financial results from continuing operations for Easyriders,
    Inc.'s four operating segments have been prepared on a basis which is
    consistent with the manner in which Easyriders, Inc.'s management internally
    disaggregates financial information for the purposes of assisting in making
    internal operating decisions. In this regard, certain common expenses have
    been allocated among segments less precisely than would be required for
    stand alone financial information prepared in accordance with generally
    accepted accounting principles. Revenue attributed to geographic areas is
    based on the location of the customer.

                                       9
<PAGE>

EASYRIDERS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTH PERIODS ENDED MARCH 31, 2001 AND 2000 (unaudited)
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------------------------
                                                                                             Franchis-        Other
                                                             Publish  Goods and     Food        ing/          Opera-
(in dollars)                                                  -ing    Services    Service    Licensing        tions     Totals
---------------------------------------------------------------------------------------------------------------------------------
<S>                                                        <C>        <C>         <C>        <C>            <C>         <C>
Sales external customers -Quarter ended March 31, 2001     6,529,004  1,727,190        -           -           36,971   8,293,165
---------------------------------------------------------------------------------------------------------------------------------
Sales external customers -Quarter ended March 31, 2000     5,487,497  1,432,451        -           -        1,485,491   8,405,439
---------------------------------------------------------------------------------------------------------------------------------
Income (loss) from continuing operations-
Quarter ended March 31, 2001                               1,198,421    819,902        -      40,173           10,014   2,068,510
---------------------------------------------------------------------------------------------------------------------------------
Income (loss) from continuing operations-
Quarter ended March 31, 2000                                  91,912   (306,359)       -    (135,925)         458,733     108,361
---------------------------------------------------------------------------------------------------------------------------------
Income (loss) from discontinued operations-Quarter ended
March 31, 2001                                                     -          -        -           -                -           -
---------------------------------------------------------------------------------------------------------------------------------
Income (loss) from discontinued operations-Quarter ended
March 31, 2000                                                     -          -  133,529           -                -     133,529
---------------------------------------------------------------------------------------------------------------------------------
Segment Assets at March 31, 2001                           6,888,201          -        -           -           24,861   6,913,062
---------------------------------------------------------------------------------------------------------------------------------
Capital Expenditures YTD March 31, 2001                       15,000          -        -           -                -      15,000
---------------------------------------------------------------------------------------------------------------------------------
Depreciation/Amortization - Quarter ended March 31, 2001      78,522          -        -           -            5,606      84,128
---------------------------------------------------------------------------------------------------------------------------------
Depreciation/Amortization - Quarter ended March 31, 2000      88,386     12,087        -       2,114           20,715     123,302
---------------------------------------------------------------------------------------------------------------------------------
</TABLE>



    A reconciliation of the totals reported for the operating segments to the
    applicable line items in the consolidated financial statements is as
    follows:



<TABLE>
<CAPTION>
                                                                                  Quarter Ended
                                                                                  -------------
<S>                                                                               <C>
March 31, 2001:
Income from continuing operations in segment disclosure                             $ 2,068,510
Unallocated, selling, general and administrative expenses                              (196,927)
                                                                                  -------------
Income from continuing operations                                                   $ 1,871,583
                                                                                  =============

March 31, 2000:
Income from continuing operations in segment disclosure                             $   108,361
Unallocated, selling, general and administrative expenses                              (710,667)
                                                                                  -------------
Loss from continuing operations                                                     $  (602,306)
                                                                                  =============

As at March 31, 2001:
Segment assets                                                                      $ 6,913,062
Cash and cash equivalents                                                               604,995
Receivable from shareholder                                                             278,324
Goodwill                                                                             25,982,688
                                                                                  -------------
Total assets                                                                        $33,779,069
                                                                                  =============
<CAPTION>
                                                                                  Quarter Ended
                                                                                  -------------
<S>                                                                               <C>
March 31, 2001:
Depreciation and amortization included in segment disclosure                        $    84,128
Amortization of goodwill                                                                274,336
                                                                                  -------------
Depreciation and amortization                                                       $   358,464
                                                                                  =============

March 31, 2000:
Depreciation and amortization included in segment disclosure                        $   123,302
Amortization of goodwill                                                                469,740
                                                                                  -------------
Depreciation and amortization                                                       $   593,042
                                                                                  =============
</TABLE>

                                       10
<PAGE>

EASYRIDERS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTH PERIODS ENDED MARCH 31, 2001 AND 2000 (unaudited)
--------------------------------------------------------------------------------

    Revenues concerning principal geographic areas are as follows based on
    customer location:

<TABLE>
<CAPTION>
                      USA           Canada         Germany           UK          Australia         Other           Total
                 -------------------------------------------------------------------------------------------------------------

<S>                  <C>             <C>            <C>            <C>             <C>            <C>            <C>
Q/E 3/31/01          $7,619,932      264,153         92,805        115,341         103,941          96,993       $8,293,165
Q/E 3/31/00          $7,364,902      264,355        135,760        125,186         106,117         409,119       $8,405,439
</TABLE>



    The Company's foreign operations consist primarily of international
    newsstand sales and mail-order product sales.  The Company does not have any
    identifiable assets attributable to these foreign activities and does not
    separately identify any expenses relating specifically to foreign
    activities.  Therefore, income before taxes and net income associated with
    foreign activities is not presented.

                                       11
<PAGE>

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

     Management's discussion and analysis of the results of operations and
financial condition of the Company should be read in conjunction with the
Consolidated Financial Statements and related Notes thereto.

Overview

     Easyriders is a corporation established under the laws of the state of
Delaware on May 13, 1998.  Easyriders currently derives substantially all of its
revenues from the Paisano Publications, having sold all of its interests in El
Paso in October 2000.

     On September 23, 1998, Easyriders consummated a series of transactions (the
"Reorganization") comprising the following: (a) the acquisition by Easyriders
from Joseph Teresi of all of the outstanding common stock of Paisano
Publications and certain affiliated corporations (the "Paisano Companies"),
engaged at the time in (i) publishing special-interest magazines relating
primarily to American-made "V-Twin" motorcycles and tattoo art, (ii) selling
branded motorcycle apparel and accessories through a mail-order catalogue,
events and franchise stores, (iii) producing motorcycle and tattoo-related
events, and franchising retail stores to market its branded motorcycle apparel
and accessories; (b) the acquisition by Easyriders of all of the outstanding
membership interests of El Paso, which at the time was engaged in the operation
of four restaurants under the name "El Paso Bar-B-Que"; and (c) the merger (the
"Merger") of a subsidiary of Easyriders with and into Newriders, Inc., a Nevada
corporation ("Newriders").

     As a result of the Merger (i) each two shares of Newriders common stock,
par value $.01 per share (the "Newriders Common Stock") were exchanged for one
share of Easyriders common stock, par value $.001 per share ("Easyriders Common
Stock"), and the shareholders of Newriders immediately prior to the Merger
became stockholders of Easyriders, (ii) all of the outstanding options, warrants
and other convertible securities exercisable for or convertible into Newriders
Common Stock were exchanged for the right to purchase or convert into one-half
the number of shares of Easyriders Common Stock at an exercise price or
conversion ratio per share equal to two times the exercise price or conversion
ratio provided for in the stock option, warrant or other agreements evidencing
such options, warrants or other convertible securities, and (iii) Newriders, the
Paisano Companies and El Paso became wholly-owned subsidiaries of Easyriders.
The Merger was accounted for as a combination of entities under common control,
similar to a pooling of interest.  Therefore, the historical financial
statements represent the combined financial statements of the Company and
Newriders.  The acquisitions of the Paisano Companies and El Paso were accounted
for as a purchase.

     The acquisition of the Paisano Companies had, and will continue to have, a
material impact on the Company's financial statements; accordingly, current and
future financial statements may not be directly comparable to the Company's
historical financial statements.  In future periods, the amortization of
goodwill will significantly effect the Company's financial statements.

                                       12
<PAGE>

Use of EBITDA

     The following comparative discussion of the results of operations and
financial condition of the Company includes, among other factors, an analysis of
changes in the operating income of the business segments before interest
expense, taxes, depreciation and amortization ("EBITDA") in order to eliminate
the effect on the operating performance of the Paisano Companies of significant
amounts of amortization of intangible assets and interest expense recognized
through the Reorganization. Further, the Company has added back non-cash charges
consisting of stock issuance expenses to derive an adjusted EBITDA ("Adjusted
EBITDA").  Financial analysts generally consider EBITDA to be an important
measure of comparative operating performance for the businesses of the Company
and its subsidiaries, and when used in comparison to debt levels or the coverage
of interest expense as a measure of liquidity.  However, EBITDA should be
considered in addition to, not as a substitute for, operating income, net
income, cash flow and other measures of financial performance and liquidity
reported in accordance with accounting principles generally accepted in the
United States of America.  Also, EBITDA, as calculated by the Company, may not
be comparable to similarly titled measures used by other companies.

                                       13
<PAGE>

Results of Operations

The following table sets forth certain operating data for Easyriders for the
three months ended March 31, 2001 and 2000:

<TABLE>
<CAPTION>
                                               Easyriders       Paisano Companies     Consolidated     Consolidated

                                                              For the Three Months Ended March 31,
                                             -----------------------------------------------------------------------
<S>                                            <C>              <C>                  <C>              <C>
                                                    2001                2001              2001             2000
CONTINUING OPERATIONS:                                                      (unaudited)
SALES
Publishing                                     $        -             $6,529,004        $6,529,004       $ 5,487,497

Goods and services                                                     1,727,190         1,727,190         1,432,451
Food service                                                                                     -                 -
Franchising/Licensing                                                          -                 -                 -
Other operations                                                          36,971            36,971         1,485,491
                                               ---------------------------------------------------------------------
                                                        -              8,293,165         8,293,165         8,405,439
COST OF SALES
Publishing                                                             4,592,395         4,592,395         4,359,798
Goods and services                                                       834,380           834,380         1,416,881
Food service                                                                                     -                 -
Franchising/Licensing                                                          -                 -                 -
Other operations                                                          26,723            26,723         1,020,058
                                               ---------------------------------------------------------------------
                                                        -              5,453,498         5,453,498         6,796,737
GROSS MARGIN
Publishing                                              -              1,936,609         1,936,609         1,127,699
Goods and services                                      -                892,810           892,810            15,570
Food service                                            -                      -                 -                 -
Franchising/Licensing                                                          -                 -                 -
Other operations                                        -                 10,248            10,248           465,433
                                               ---------------------------------------------------------------------
                                                        -              2,839,667         2,839,667         1,608,702
EXPENSES
Publishing                                                               738,188           738,188         1,035,787
Goods and services                                                        72,908            72,908           321,929
Food service                                                                                     -                 -
Franchising/Licensing                                                    (40,173)          (40,173)          135,925
Other operations                                                             234               234             6,700
Unallocated expenses                              190,858                  6,069           196,927           710,667
                                               ---------------------------------------------------------------------
                                                  190,858                777,226           968,084         2,211,008
INCOME (LOSS) FROM OPERATIONS
Publishing                                              -              1,198,421         1,198,421            91,912
Goods and services                                      -                819,902           819,902          (306,359)
Food service                                            -                      -                 -                 -
Franchising/Licensing                                                     40,173            40,173          (135,925)
Other operations                                        -                 10,014            10,014           458,733
Unallocated                                      (190,858)                 6,069          (196,927)         (710,667)
                                               ---------------------------------------------------------------------
                                               $ (190,858)            $2,062,441        $1,871,583       $  (602,306)
                                               =====================================================================

NET INCOME (LOSS) FROM CONTINUING OPERATIONS
                                               $ (459,192)            $1,374,176        $  914,984       $(1,516,647)

NET INCOME (LOSS) FROM
  DISCONTINUED OPERATIONS                               -                      -                 -           133,529
                                               ---------------------------------------------------------------------


NET INCOME (LOSS)                              $ (459,192)            $1,374,176        $  914,984       $(1,383,118)
                                               =====================================================================
</TABLE>

                                       14
<PAGE>

The following tables set forth the EBITDA calculations for Easyriders for the
three month periods ended March 31, 2001 and 2000:

<TABLE>
<CAPTION>
                                                                Paisano
                                        Easyriders             Companies             Consolidated         Consolidated
                                                                  For the Three Months Ended March 31,
                                    ----------------------------------------------------------------------------------
<S>                                     <C>                    <C>                   <C>                  <C>
                                            2001                  2001                    2001                 2000
Continuing Operations:
Net income (loss)                        $(459,192)            $1,374,176              $  914,984          $(1,516,647)
Interest expense                           299,962                690,422                 990,384              976,638
Income tax expense                          16,425                      -                  16,425                7,851
Depreciation /amortization expense           5,606                352,858                 358,464              593,042
                                         -----------------------------------------------------------------------------
EBITDA - Continuing Operations           $(137,199)            $2,417,456              $2,280,257          $    60,884
                                         =============================================================================


Discontinued Operations:
Net income (loss)                        $       -             $        -              $        -          $   133,529
Interest expense                                 -                      -                       -              105,867
Income tax expense                               -                      -                       -                    -
Depreciation /amortization expense               -                      -                       -              236,494
                                         -----------------------------------------------------------------------------
EBITDA - Discontinued Operations         $       -             $        -              $        -          $   475,890
                                         =============================================================================


EBITDA                                   $(137,199)            $2,417,456              $2,280,257          $   536,774
Add back stock issuance expense                  -                      -                       -              173,242
                                         -----------------------------------------------------------------------------
Adjusted EBITDA                          $(137,199)            $2,417,288              $2,280,257          $   710,016
                                         =============================================================================


</TABLE>
The three months ended March 31, 2001 compared to the three months ended March
31, 2000

Results of Operations of Easyriders Inc. and subsidiaries

     During the three months ended March 31, 2001, the Company generated net
income in the amount of $914,984, reflecting an improvement in results of
$2,298,102, when compared with the net loss of $1,383,118 for the three months
ended March 31, 2000.  This improvement for the three month period can be
attributed to an improvement in gross margin of $1,230,965 and a $1,242,924
reduction in operating expenses, offset by a $42,258 increase in interest and
other expenses and income taxes and a $133,529 decrease in income from
discontinued operations.  Net income from continuing operations improved
$2,431,631 for the three month periods, from a net loss of $1,516,647 in 2000 to
net income of $914,984 in 2001.

     On October 5, 2000, the Company sold all of the interests in El Paso.  The
subsidiary is reflected as discontinued operations for the three month period
ended March 31, 2000 in the accompanying financial statements so that the
periods presented are comparable.

     The Company's net income per share, both basic and diluted, improved $0.09
per share to $0.03 per share for the three months ended March 31, 2001, as
compared to the net loss per share of $0.06 for the three months ended March 31,
2000.

     The Company generated EBITDA in the amount of $2,280,257 for the three
months ended March 31, 2001, compared with EBITDA of $536,774 for the three
months ended March 31, 2000, reflecting an improvement in EBITDA of $1,743,483,
or 325%.  Adjusted EBITDA reflects the add-back of non-cash charges related to
stock issuance expenses of $0 and $173,242 for the three month periods

                                       15
<PAGE>

ended March 31, 2001 and 2000, respectively. As such, for the three months ended
March 31, 2001, adjusted EBITDA was the same as EBITDA, while for the three
months ended March 31, 2000 adjusted EBITDA was $710,016, resulting in an
improvement in adjusted EBITDA of $1,570,241, or 221%. EBITDA from continuing
operations was $2,280,257 for the three months ended March 31, 2001, compared
with EBITDA from continuing operations of $60,884 for the three months ended
March 31, 2000, reflecting a substantial improvement in EBITDA from continuing
operations of $2,219,373.

     Results of Operations: Paisano Companies

     The operating results of the Company for the three months ended March 31,
2001 and March 31, 2000 include the results for the Paisano Companies.

     The Paisano Companies' publishing segment includes sales generated from
subscription sales, newsstand sales and advertising sales related to the
Companies' special interest magazines.  The related cost of sales includes
direct costs related to the sales, consisting primarily of printing, paper,
publication and distribution costs.  The goods and services segment includes
sales generated from the sale of apparel and other products through its mail-
order catalogs, one retail store, and franchise/license programs.  The related
cost of sales includes the costs of the apparel and other products.  The
franchising/licensing segment includes sales generated through franchise fees
charged to the operating franchisees/licensees of the retail stores.  There is
no material related cost of sales.  Through March 2000, the Paisano Companies'
other segment primarily included Events, which generated substantially all of
its revenues from the sale of tickets to motorcycle rodeos, motorcycle shows,
and tattoo shows.  In March 2000, the Company licensed its rights to produce and
manage these events.  Since then, such revenues have been generated through
royalties and license fees paid pursuant to this Events outsourcing transaction.
Cost of sales for the other segment consists primarily of direct costs of
promoting the events.

     The Paisano Companies' total sales decreased $112,274, or 1%, from
$8,405,439 for the three months ended March 31, 2000 to $8,293,165 for the same
three months in 2001.  This decrease can be attributed to a combination of
reduced revenues from Easyriders of Columbus of  $652,669 as a result of  this
store being sold in April 2000, and reduced revenues from Easyriders Events of
$960,476 as a result of a restructuring in March 2000 under which a third party
licensed the rights to produce and manage events and to sell event-specific
merchandise, offset by increased revenues from Paisano Publications of
$1,500,871 resulting from 1) the recognition of a $500,000 in revenues from the
products sold and services rendered under the terms of the licensing arrangement
with Southern Steel, 2) the sale of $584,966 of merchandise to Southern Steel,
3) an increase in magazine sales of $303,929, and 4) increases in other
departments of $111,976.

     The Paisano Companies' gross margin increased $1,230,965, or 77%, from
$1,608,702 for the three months ended March 31, 2000, to $2,839,667 for the
three months ended March 31, 2001.  As a percentage of sales, gross margin for
the Paisano Companies increased from 19% to 34%. The increase in gross margin
can be substantially attributed to 1) an increase in gross margin in the
magazine department of $651,251, of which $112,453 results from additional
sales, and $538,798 results from cost savings from reduced personnel, space
rental, and travel, 2) an increase in gross margin of $993,689 in the products
department, of which $500,000 is attributable to the Southern Steel licensing
agreement, $305,409 is due to increased sales, and $188,280 is due to decreased
costs of personnel, space rent, and travel, 3) a decrease in gross margin of
$304,637 resulting from the closure of our events division, and 4) a decrease in
gross margin of $128,536 resulting from the sale of our Columbus division.

     The Paisano Companies' income from operations increased a substantial
$2,007,218, from $55,223 for the three months ended March 31, 2000, to
$2,062,441 for the three months ended March 31, 2001.  This increase can be
attributed to a combination of an increase in gross margin of $1,230,965 and

                                       16
<PAGE>

a decrease in operating expenses of $776,253. The decrease in operating expenses
can be primarily attributed to 1) reduced expenses of $176,098 resulting from
the closure of Franchising, 2) reduced expenses of $181,607 resulting from the
closure of Columbus, 3) reduction in stock issuance expenses of $173,242, and 4)
reduced salaries of $232,515.

     Expenses of the Paisano Companies not allocated to any segment amount to
$6,069 and $710,667 for the three months ended March 31, 2001 and 2000,
respectively.  The allocated expenses include payroll, promotion, and other
general and administrative expenses specifically attributable to the business
segments.  The unallocated expenses represent legal and professional fees and
other expenses which are not specifically attributable to a business segment.

     Payroll and related benefits for the Paisano Companies decreased $56,057,
or 17%, from $327,524 for the quarter ended March 31, 2000 to $271,467 for the
same quarter in 2001. This decrease is the result of efforts to reduce costs by
decreasing staff size.  Depreciation and amortization for the quarters ended
March 31, 2001 and 2000 totaled $352,858 and $558,126, respectively, of which
$274,336 and $469,740 for the respective quarters relates to the amortization of
the goodwill created out of the Paisano Companies' acquisition by the Company.
The decrease in the amortization of goodwill, and in turn in the depreciation
and amortization in total, is the result of the Company recording a $25 million
reduction of the balance in goodwill as a result of impairment as of December
31, 2000.

     Interest expense for the Paisano Companies increased $7,719, or 1%, from
$678,535 for the quarter ended March 31, 2000 to $686,254 for the quarter ended
March 31, 2001.  This increase is attributable to additional borrowings under
the Revolving Loan.

     The net income for the Paisano Companies increased a substantial
$2,056,251, from a net loss of $682,075 for the three months ended March 31,
2000 to net income of $1,374,176 for the three months ended March 31, 2001.  The
increase in net income can be primarily attributed to improved results of
operations for Paisano Publications, Inc. which went from a loss of $725,028 to
net income of $1,338,394 for the quarters ended March 31, 2000 and 2001,
respectively.  This improvement in net income is substantially the result of 1)
increased sales of $1,500,871, 2) decreased cost of sales of $187,078, and
decreased general and administrative costs of $206,814, both resulting from cost
containment efforts, and 3) reduced amortization expense of $205,268 resulting
from a $25,000,000 write down of goodwill in December 2000.  EBITDA for the
three month periods improved by $1,838,495, or 318%, from $578,961 for the three
months ended March 31, 2000 to $2,417,456 for the three months ended March 31,
2001.

     The principal raw material used in publishing operations of the Paisano
Companies is paper. Paper costs represented approximately 17% of Paisano
Publications' production, selling and other direct costs for both the three
month periods ended March 31, 2001 and 2000. Certain commodity grades of paper
have shown considerable price volatility over the last decade.  There can be no
assurance that future fluctuations in paper prices will not have a material
adverse effect on the Paisano Companies' results of operations or financial
condition.

     The profitability of the Paisano Companies' publishing segment is also
affected by the cost of postage and could be materially adversely affected if
there is an increase in postal rates. No assurance can be given that the
publishing segment can recoup paper or postal cost increases by passing them
through to its advertisers and readers. In addition, future fluctuations in
paper prices and/or postal rates could have an effect on the results of
operations and financial condition of the publishing segments.

                                       17
<PAGE>

Liquidity and Capital Resources

     The Company's primary cash requirements are to fund the Company's operating
costs (primarily payroll and related expenses) and working capital needs
(primarily accounts receivable, inventory, prepaid expenses and debt service).
On March 31, 2001, the Company had negative working capital of $26.1 million due
primarily to the pending maturity of the Nomura Indebtedness of $21.1 million
and deferred subscription and advertising income of $4.8 million.

     Cash provided by operating activities from continuing operations during the
three month period ended March 31, 2001 totaled approximately $0.3 million.  The
operating net income of $0.9 million was increased by several non-cash charges
including $0.4 million for depreciation and amortization, $0.1 million for non-
cash interest expenses, and $0.1 million of amortization of debt issuance costs,
and offset by a $0.1 million gain from the Martin Unwind transaction.  Cash of
$1.1 million was used for changes in operating accounts.

     Upon its acquisition by the Company, Paisano Publications obtained an
aggregate of $22,000,000 in Nomura Indebtedness.  This financing was comprised
of a $17,000,000 senior term loan (the "Term Loan") and a $5,000,000 revolving
loan (the "Revolving Loan").  The proceeds from the Term Loan plus $3,500,000 of
the Revolving Loan were used to repay certain promissory notes issued to the
shareholder of the Paisano Companies in conjunction with the Paisano Acquisition
and to pay certain acquisition expenses.  To the extent that Paisano
Publications is in compliance with the terms of the Nomura Indebtedness, any
unused portion of the Revolving Loan may be used by Paisano Publications for
working capital purposes.  Available borrowings under the Revolving Loan are
subject to the approval of the Lender.   At March 31, 2001, there were no
available borrowings under the Revolving Loan.

     The Nomura Indebtedness is guaranteed (the "Guarantees") by the Company and
the Paisano Companies, other than Paisano Publications (the "Guarantors").  The
Nomura Indebtedness will mature on September 23, 2001, and bears interest at an
annual rate equal to the prime rate of the Lender from time to time plus 1.85%,
payable monthly.  The Nomura Indebtedness and the Guarantees are secured by a
first priority security interest in substantially all of the tangible and
intangible assets (owned or hereafter acquired) of the Company and the Paisano
Companies, including all of the capital stock or equity interests of the Paisano
Companies and Newriders.  The Nomura Indebtedness and the Guarantees constitute
the sole senior secured indebtedness of Paisano Publications and Guarantors and
rank senior to all other indebtedness of Paisano Publications and the
Guarantors. With respect to the September 23, 2001 maturity, the Company has
begun to explore alternative financing sources and has requested from Nomura a
short-term extension of the maturity date sufficient to allow the Company to
refinance the Nomura Indebtedness with other lenders, investors and/or joint
venture partners.  Thus far, Nomura has refused to consent to such request.
There can be no assurance that Nomura will grant an extension, or that the
Company will be successful in its efforts to secure such alternate financing.

     At the end of each one-month period in which the Term Loan is outstanding,
Paisano Publications is required to prepay the Term Loan in an aggregate
principal amount equal to 35% of Excess Cash Flow, as defined in the Credit
Agreement, for such period, to the extent such Excess Cash Flow is achieved.
The Term Loan has been classified as a current liability at March 31, 2001.

     Subject to certain limitations on dividends, and provided that no event of
default has occurred, Paisano Publications may advance funds to the Company
monthly, limited to the lessor of $100,000 or 35% of the Excess Cash Flow for
the preceding monthly period.  As of March 31, 2001, Paisano Publications has
provided $508,299 of funding to the Company based on Paisano's attainment of
Excess Cash Flow.  The inability of Paisano Publications to provide funds to the
Company can adversely impact the ability of the Company to repay certain
expenses of the Company.

                                       18
<PAGE>

     Because the Nomura Indebtedness includes restrictions on the ability of the
Paisano Companies to transfer funds to the Company in the form of cash
dividends, loans or advances, the net assets of the Paisano Companies are
considered to be restricted.  The restricted net assets of the Paisano Companies
on March 31, 2001 totaled $984,788.

     The Nomura Indebtedness contains numerous operating and financial
covenants, including but not limited to, payment of dividends, limitations on
indebtedness and the maintenance of minimum net worth, minimum working capital,
interest coverage ratios and the achievement of cash flow measures.  As of March
31, 2001, the Company was not in compliance with any of such financial
covenants.  In addition, as of March 1, 2001, the Company was not in compliance
with certain technical compliance provisions of the Nomura Credit Agreement.  No
assurance can be given that a satisfactory resolution of these default issues
will be obtained.  Any non-compliance could restrict the Company's business
activities, and could expose the Company to materially adverse consequences if
any such defaults are not resolved, by reason of the remedies available to
Nomura under the loan documents pertaining to the Nomura Indebtedness, including
but not limited to, the foreclosure on the Company's assets, which are provided
as collateral.

    In connection with the Paisano Acquisition, the Company issued Subordinated
Seller Notes in the aggregate amount of $13,000,000 to Joseph Teresi, the sole
shareholder of the Paisano Companies prior to the Paisano Acquisition. The
Subordinated Seller Notes consisted of a subordinated promissory note in the
amount of $5,000,000, a limited recourse subordinated promissory note in the
amount of $5,000,000 secured by the Martin Mirror Note (as defined in the
applicable instruments) and a short-term subordinated promissory note in the
amount of $3,000,000.  The first two notes (the "Subordinated Notes") bear
interest at an annual rate that escalates from 6% to 10% and may be extended for
an additional five years.  The remaining $3,000,000 (the "Short Term Note") was
initially issued as a 90 day note that bears interest at an annual rate of 10%.
On April 3, 2000, the then remaining principal and interest balance on the
$5,000,000 subordinated promissory note was exchanged for 3,356,710 shares of
Easyriders, Inc. Common Stock issued to Mr. Teresi.  Mr. Teresi has agreed to
defer collection of current interest on the remaining $8,000,000 of the
Subordinated Seller Notes until after March 2002.

    In October 1999, Paisano Publications issued a $275,000 increasing rate
secured promissory note to an investment partnership, Siena Capital Partners,
L.P.  This loan (the "Siena Loan") is subordinate to the Nomura Indebtedness.
The loan bears interest at a rate of 20% per annum (increasing by 1% monthly
beginning April 14, 2000), and is due and payable with accrued interest on
October 14, 2000. Warrants to purchase 100,000 shares of the Common Stock of the
Company  were issued with an exercise price of $0.01 per share. If the Siena
Loan has been paid off in its entirety by April 13, 2000, the warrants become
null and void. In addition, if the balance is not paid in full by July 13, 2000,
the Company must issue warrants to purchase an additional 300,000 shares of the
Common Stock of the Company, and if the balance is not paid in full by October
13, 2000, the Company must issue warrants to purchase an additional 100,000
shares of the Common Stock of the Company.  Thereafter, until the loan is paid
off in full, the Company must issue warrants to purchase 150,000 shares of the
Common Stock of the Company on the 13th day of each month.

    As of April 13, 2000 the Company did not possess the resources to pay off
the Siena Loan.  However, John Martin and Joseph Teresi were granted a right of
first refusal in connection with any assignment of the Siena Loan.  Based on
this right, the Company pursued negotiations with Mr. Teresi and Mr. Martin
concerning their assumption of the Siena Loan upon terms more favorable to the
Company.  These negotiations were successful and on April 13, 2000, Mr. Martin
and Mr. Teresi each paid to Siena the sum of $137,500 and assumed the position
of Siena with respect to the Siena Loan.  Concurrently, the first 100,000
warrants vested, and Mr. Martin and Mr. Teresi agreed to make the following
modifications to the Siena Loan terms:

                                       19
<PAGE>

 .    The interest rate was reduced from 20% per annum to 13% per annum.

 .    Provided the Siena Loan is paid off by December 31, 2000, twenty percent
     (20%) of all warrants vested by and through such date will be surrendered.

     As of December 31, 2000, the Company did not possess the resources to pay
off the Siena Loan.  As a result, as provided under the modified terms, an
additional 350,000 warrants vested to each of Mr. Martin and Mr. Teresi.  In
addition, as of March 13, 2001, the Company still did not possess the resources
to pay off the Siena Loan and, as a result, an additional 225,000 warrants
vested to each of Mr. Martin and Mr. Teresi.  As of March 30, 2001, Mr. Teresi
aquired all of Mr. Martin's interest in the Siena Loan, and all warrants vested
up to such date.

     On October 5, 2000, the Company sold all interests in El Paso Bar-B-Que
Company to a newly formed subsidiary of Culinary Holdings, Inc. for a
combination of cash in the amount of $4,000,000 and the assumption of
liabilities in the amount of approximately $6,700,000.  In accordance with the
terms of the sale transaction, the Company forgave a net intercompany receivable
of $782,753. In addition, Culinary Holdings assumed $1,000,000 of convertible
debentures held by a director of the Company, who thereupon released the Company
from any obligation in connection therewith.

     While the Company secured a $4 million cash infusion through the sale of El
Paso Bar-B-Que Company, it continues in its attempts to secure additional cash
infusions through the consummation of certain other business transactions.  The
Company is also evaluating the issuance of additional debt or equity securities.
While the Company believes that such efforts, together with ongoing operations,
will enable the Company to meet its anticipated cash needs for the next 12
months (excluding the repayment of the Nomura Indebtedness, if not otherwise
refinanced), there can be no assurance that this will be the case, as
projections of future cash needs and cash flows are subject to substantial
uncertainty.  In the event that the Company is unsuccessful in its efforts to
raise capital beyond that which is projected to be realized from current
operations, the Company will not be able to meet its liquidity obligations.

Forward-Looking Information and Certain Factors

     Certain statements in this Form 10-K and in future filings by the Company
with the Securities and Exchange Commission, in the Company's press releases,
and in oral statements made by or with the approval of an authorized executive
officer constitute "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995 (the "Reform Act").  The
forward-looking statements are subject to numerous risks and uncertainties that
could cause actual results to differ materially from those set forth in such
forward-looking statements.  Such risks and uncertainties include, without
limitation, risks associated with future capital needs, management of growth,
availability of adequate financing, integration of business operations,
concentration of stock ownership, restrictions imposed on the Company by the
Lender, the magazine publishing and restaurant business, paper, and other raw
material prices and other factors discussed herein, in the Company's
Prospectus/Proxy Statement on Form S-4 dated September 8, 1998 and other filings
submitted to the Securities and Exchange Commission.

Recent Accounting Pronouncements

     Statement of Financial Accounting Standards ("SFAS") No. 133, Accounting
for Derivative Instruments and Hedging Activities, was issued in June 1998 and
establishes accounting and reporting standards for derivative instruments,
including certain derivative instruments embedded in other contracts,
(collectively referred to as derivatives) and for hedging activities.  SFAS No.
133 was initially effective for all fiscal quarters of fiscal years beginning
after June 15, 1999.  In July 1999, SFAS No.

                                       20
<PAGE>

137, Accounting for Derivative Instruments and Hedging Activities - Deferral of
the Effective Date of FASB Statement No. 133, was issued which delays the
effective date of SFAS No. 133 to fiscal years beginning after June 15, 2000.
The Company does not believe that the adoption of this new standard will have a
material impact on its financial position or results of operations.

     In December 1999, the SEC staff issued Staff Accounting Bulletin (SAB) No.
101, Revenue Recognition in Financial Statements, which became effective
December 2000.  SAB No. 101 summarizes the SEC staff's views in applying
generally accepted accounting principles to revenue recognition in financial
statements. The application of this SAB did not have a material effect on the
Company's revenue recognition policies.

     In March 2000, the Financial Accounting Standards Board (FASB) issued
Interpretation No. 44 of Accounting Principles Board Opinion No. 25 Accounting
for Certain Transactions Involving Stock Compensation, which, among other
things, addressed accounting consequences of a modification that reduces the
exercise price of a fixed stock option award (otherwise known as repricing). If
the exercise price of a fixed stock option award is reduced, the award must be
accounted for as variable stock option plan from the date of the modification to
the date the award is exercised, is forfeited, or expires unexercised. The
exercise price of an option award has been reduced if the fair value of the
consideration required to be paid by the grantee upon exercise is less than or
potentially less than the fair value of the consideration that was required to
be paid pursuant to the award's original terms. The requirements about
modifications to fixed stock option awards that directly or indirectly reduce
the exercise price of an award apply to modifications made after December 15,
1998, and will be applied prospectively as of July 1, 2000.  The adoption of
this interpretation did not impact the Company's financial statements.

     In January 2001, the Financial Accounting Standards Board Emerging Issues
Task Force issued EITF 00-27 effective for convertible debt instruments issued
after November 16, 2000.  This pronouncement requires the use of the intrinsic
value method for recognition of the detachable and imbedded equity features
included with indebtedness, and requires amortization of the amount associated
with the convertibility feature over the life of the debt instrument rather than
the period for which the instrument first becomes convertible.  Inasmuch as all
debt instruments that were entered into prior to November 16, 2000 and all of
the debt discount relating to the beneficial conversion feature was previously
recognized as expense in accordance with EITF 98-5, there is no impact on these
financial statements.  This EITF 00-27, could impact future financial
statements, should the Company enter into such agreements.

Item 3.  Quantitative and Qualitative Disclosure About Market Risk

     The Company is exposed to a variety of risks, including paper price
volatility and changes in interest rates affecting the cost of its debt.

Paper Price Volatility

     A primary component of the Company's cost of sales in the magazine
publishing segment is the cost of paper.  Consequently, increases in paper
prices can adversely impact the Company results of operations.

Interest Rates

     The Company is subject to certain interest rate risk related to the Senior
Loans.  The Senior Loans mature on September 23, 2001 and bear interest at an
annual rate equal to the prime rate of the Lender plus 1.85% payable monthly.
Excluding any effect from the Default Rate of interest asserted by

                                       21
<PAGE>

Nomura, the interest rate on the balance of $21,097,814 outstanding on March 31,
2001 was 9.85 %. An increase in interest rates of 1% would result in an increase
in interest expense of approximately $210,000.

     The Company's remaining long-term debt has fixed interest rates and
therefore the Company does not believe an increase in interest rates would have
a material impact on the Company's consolidated financial statements.


PART II -- OTHER INFORMATION
----------------------------

Item 1.  Legal Proceedings.

     The Hatcher Litigation

     On April 28, 2000, an action was filed in the U.S District court for the
Central District of California (Los Angeles) by Leon Hatcher, Richard Stafford
and entities controlled by them, naming as defendants the Company, Newriders,
Paisano Publications, El Paso, Easyriders Franchising, Easyriders Licensing,
Easyriders of Ohio, and the following current or former officers and/or
directors of the Company: John Martin, William Prather, Joseph Teresi, J. Robert
Fabregas, William Nordstrom, Robert Davis, Ellen Meagher, Joseph Jacobs, Daniel
Gallery, Wayne Knyal, and Grady Pfeiffer (the "Hatcher Action").  The complaint
also named as a defendant James E. Salven, Trustee in Bankruptcy in connection
with the Pierce Action, previously disclosed by the Company.

     The Hatcher Action alleged wrongful conduct on the part of the named
defendants in connection with Mr. Hatcher's past and current relationship with
Easyriders and Newriders, including:  (a) his role and ownership position in
Newriders prior to the Reorganization, (b) his role and participation in the
Reorganization, (c) his acquisition of shares of Easyriders as a consequence of
the Reorganization, (d) transactions involving the shares held by Mr. Hatcher in
Newriders and Easyriders, (e) the Company's Events business and his role
therein, (f) the Company's event merchandise business and Mr. Hatcher's role
therein, (g) the use and possession by Mr. Hatcher of property and vehicles used
in connection with the Events and event merchandise business of the Company, (h)
the acquisition by Mr. Hatcher and Mr. Stafford of franchises to operate retail
stores under the "Easyriders" name pursuant to various written agreements, and
(i) the termination of such franchise agreements by the Company in April, 2000.

     The complaint asserted wrongful conduct by defendants in connection with
the foregoing under a wide range of legal theories, including violations of the
Securities Act of 1933, the Securities Exchange Act of 1934, the California
Corporations Code, Federal Trade Commission Disclosure Rules, the California
Franchise Investment Law Laws and the Federal RICO statute (18 U.S.C. sections
1961-1968); breach of fiduciary responsibilities; fraud, negligent
misrepresentation, breach of contract, infliction of emotional distress,
interference with contracts and business relations, unfair competition and
defamation. Certain of the causes of action were presented as derivative claims,
brought on behalf of Easyriders and/or Newriders against one or more individual
defendants.  The action sought general and compensatory damages in amounts to be
proven at the time of trial, contract damages of $450,000, punitive damages,
injunctive and declaratory relief, and the appointment of a receiver.

     On July 31, 2000, the U.S. District Court in Los Angeles issued an order
dismissing the Hatcher Action in its entirety, based on a motion brought by
defendants challenging the complaint as being in violation of applicable rules
requiring that complaints in Federal court set forth a "short and plain"
statement of the basis for relief, and that allegations of fraud be specific as
to all details.  The order

                                       22
<PAGE>

granted plaintiffs 30 days to file a new complaint, stating that any amended
complaint "must be a short, plain statement which is concise, simple and direct
in compliance with Rule 8 (a). Furthermore, allegations of fraud,
misrepresentation and securities fraud must be alleged with particularity in
compliance with Rule 9." Subsequently, Plaintiff has filed two amended
complaints which the Company has challenged for similar reasons. On January 29,
2001, the court heard the Company's motion to dismiss the plaintiffs' Second
Amended Complaint, but a ruling on this motion has not yet been issued. If this
motion is granted, it is possible that the Hatcher Action could be dismissed
entirely, with finality, or with leave to re-file the case again. The exact
outcome of this procedural challenge is, however, presently unknown.

     The Company believes it has substantial defenses to any amended complaint
plaintiff's may pursue or file in this action.  Based on the current pleadings,
the Company and its officers and directors are insured under a policy providing
indemnification for damages arising from securities claims and the misconduct of
its management, and has received confirmation from its carrier ("D&O Carrier")
that the Hatcher Action claims are covered by such policy.  It is possible,
however, that claims could survive the Company's motion to dismiss which are not
covered by insurance.  The outcome of this action, though uncertain, could be
materially adverse if such insurance coverage is not available.

     The Pierce Litigation

     The Company has previously reported on the legal action involving Rick
Pierce, a former shareholder of Newriders, including (a) Mr. Pierce's Chapter 7
bankruptcy proceeding pending in the United States Bankruptcy Court, Eastern
District of California, Fresno Division, Case No. 98-19101-A-11, which was
commenced as an involuntary proceeding and then converted to a Chapter 11 case
with the debtor, Rick Pierce, in possession, and (b) the Company's adversary
proceeding against the Pierce Bankruptcy Estate and other parties who claim an
interest in shares of the Company acquired through various transactions with Mr.
Pierce.  This action involves claims and counterclaims arising out of the 1998
Reorganization in which Mr. Pierce sought damages of at least $20 million.

     As a consequence of the previously-reported (a) settlement conference in
September, 1999 before Judge Montali, (b) the arrest and indictment of Mr.
Pierce on 29 counts of conspiracy, mail fraud and money laundering (c)
conversion of the bankruptcy proceeding from Chapter 11 to Chapter 7, (d)
dissolution of the creditor's committee and (e) appointment of a trustee to
administer the bankruptcy estate (the "Trustee"), as well as the subsequent
criminal conviction of Mr. Pierce on multiple felony counts, the Pierce Action
has been dormant for the past 14 months.  During this period, the company has
been in settlement discussions with the Trustee. In December 2000, the Trustee
approved a settlement providing for dismissal of the Pierce Action in exchange
for payment to the Pierce bankruptcy estate of 350,000 shares of the Company's
common stock, representing the exact amount of shares due Mr. Pierce in
accordance with his obligations in the Reorganization, plus an additional 20,000
shares. In this regard, a definitive settlement agreement was prepared and
circulated, but whether this settlement will be finalized is now uncertain by
reason of the Trustee's appointment of new counsel., who is re-examining the
facts leading to the Trustee's original willingness to agree with the terms
thereof.  In light of these developments, while the Company believes the Pierce
Action is without merit, the Company is no longer confident that a settlement of
this action will be consummated in the near future.  Accordingly, the Company is
preparing to resume its defense of this action.  Regardless of whether the
Pierce Action is litigated or settled, the Company does not believe the outcome
of this action will have a materially adverse effect on the Company.

                                       23
<PAGE>

     The Kaye, Scholer Litigation

     On April 19, 2000, the Company filed an action in Los Angeles County
Superior Court against the law firm of Kaye, Scholer, Fierman, Hays & Handler,
LLP ("Kaye, Scholer"), which represented Newriders, Inc. in the Reorganization
of 1998 (the "Kaye, Scholer Action").  The Kaye, Scholer Action alleges that
defendant, and the responsible attorneys individually, committed legal
malpractice, rendered negligent advice and breached attorney-client fiduciary
duties by failing to protect the Company's interests in connection with the
indemnification agreement entered into by and between Newriders, as Buyer, and
Paisano Publications, Inc., as Seller, in the Reorganization.  The complaint
alleges that as a consequence of such malpractice, the Company incurred costs in
excess of $2.5 million in connection with the previously reported Steel Horses
Arbitration, and seeks recovery of such sums, and other damages.  In the action,
Kaye, Scholer has filed a cross-complaint seeking recovery of unpaid legal fees
in the amount of approximately $100,000.  This action is in the discovery phase.
A mandatory mediation session was held on April 24, 2001, which determined that
the positions of the parties are too far apart for meaningful settlement
discussions to take place at this time.

     The Richard Dillon Litigation

     On May 9, 2000, a complaint was filed by Richard Dillon ("Dillon") against
Easyriders in the Superior Court of Maricopa County, Arizona (the "Dillon
Action").  Dillon is a former employee of El Paso.  The Action alleges that
Dillon is entitled to damages for breach of contract and as a Wage Claim under
Arizona law, arising out of an alleged promise on the part of Easyriders to
deliver shares of stock of Easyriders to Dillon. The Dillon Action seeks
contract damages of approximately $162,000, treble damages under Arizona law of
not less than $500,000 and the recovery of attorney's fees.  The contract in
question arises out of the former employment of Dillon with M&B. Easyriders is
the sole named defendant in the Dillon Action, and disputes the claims of Dillon
therein.  The Company believes it has meritorious defenses to the Dillon Action,
however, there is no insurance coverage for this action, and the exact outcome
cannot be predicted at this time.

     The Greg King Litigation

     On August 2, 1999, Greg King ("King") filed an action against the Company
and its subsidiary, Newriders, in Los Angeles County Superior Court (the "King
Action"), seeking damages of (a) not less than $500,000 for the alleged breach
of an oral agreement to deliver certain shares of Newriders, Inc. in 1998, and
(b) approximately $100,000 for breach of an alleged oral agreement to reimburse
King for certain advances made by Mr. King on behalf of Newriders in 1998.  The
King Action also seeks these damages on the basis of alleged fraud on the part
of certain officers of Newriders. On December 23, 1999, an amended complaint was
filed naming as additional defendants, Leon Hatcher, Michael Purcell and Bill
Doyle, each a former officer and/or director of Newriders.  The allegations of
Mr. King arise out of his employment with Newriders in Fresno, California, and
his associations with Leon Hatcher and Rick Pierce, identified above.  After
extensive pre-trial investigation, the Company determined that the King Action
was without merit, and that it had substantial defenses thereto. The Company
tendered the King Action to its D&O Carrier, which indicated a willingness to
contribute towards settlement of this action. This matter was scheduled for
trial on April 30, 2001, but as the result of negotiations between King, the
Company, and the D&O Carrier, this action was settled as of April 25, 2001.
Under the terms thereof, substantially all of the consideration agreed to be
paid to Mr. King will be funded by the D&O Carrier.  The terms of settlement are
not materially adverse to the Company.

                                       24
<PAGE>

     Estate of Henry Wise v. Easyriders, Inc. et al

     On April 12, 2001 a complaint was filed in the Horry County (South
Carolina) Court of Common Pleas by Genevieve Beach, as Personal Representative
of the Estate of Henry F. Wise, II, deceased, naming as defendants the Company
and the Myrtle Beach Speedway (the "Wise Action").  The Wise Action arises out
of the death of Mr. Wise while participating in a motorcycle stunt event at the
Myrtle Beach Speedway in May of 1999 and seeks unspecified damages as the result
of alleged negligence on the part of defendants with respect to safety
precautions in connection with the event.  The event was part of a series of
motorcycle stunt events produced by Kevin Ruic, whose company, FASCAR North, had
previously sold the rights thereto to the Company.  The Company believes it has
meritorious defenses to the Wise Action, and potential cross-actions, but at
this point has not completed its investigation into the facts concerning this
matter, nor has the Company ascertained whether there is insurance coverage for
this action.  If there is no insurance coverage, it is possible that the Company
could be forced to incur substantial litigation costs, and that any adverse
ruling in this action could be material.

     Other Litigation and Claims

     The Company is named as a defendant in other legal actions arising from its
normal operations, and from time-to-time is presented with claims for damages
arising out of its actions.  The Company anticipates that any damages or
expenses it may incur in connection with these actions, individually and
collectively, will not have a material adverse effect on the Company.


Item 2.  Changes in Securities and Use of Proceeds.

     During February 2001, the Company issued 500,000 shares of Easyriders, Inc.
stock to a law firm contracted by Easyriders Franchising, Inc. as part of a
settlement agreement to pay amounts owing to such firm for services performed.
The shares were valued at their market price, market price being determined as
the closing price of the Common Stock on the American Stock Exchange on the date
of issuance.

     Effective March 30, 2001, the former Chairman of the Board of Directors of
the Company returned to the Company, for cancellation, 4.5 million shares of the
Company's common stock. The shares were valued at their market price, market
price being determined as the closing price of the Common Stock on the American
Stock Exchange on the date that he returned the shares.

     The transactions described above were exempt from the registration
requirements of the Securities Act of 1933, as amended, pursuant to Section 4(2)
thereof.


Item 3.  Defaults Upon Senior Securities


     The Nomura Credit Agreement sets forth two types of obligations on the part
of the Company:

  .  Payment-Related Obligations:  Payments in respect of interest, principal
     ---------------------------
     reduction and pay-off at maturity.

  .  Covenant-Related Obligations:  Obligations to maintain certain financial
     ----------------------------
     ratios, and to do or not do certain things, which obligations are designed
     to avoid impairment of Nomura's credit position and the value of its
     collateral.

                                       25
<PAGE>

     The Company is not in compliance with a number of its Covenant-Related
Obligations of the Nomura Credit Agreement.  In addition, Nomura and the Company
are in disagreement as to whether violations have occurred with respect to other
Covenant-Related Obligations.  This dispute remains unresolved.

     The Company is in full compliance with all Payment-Related Obligations,
provided that Nomura has demanded that the Company commence payment of a
"Default Rate" of interest on the outstanding indebtedness.  The Company has
refused to comply with this demand. This dispute remains unresolved.


Item 4.  Submission of matters to a vote of security holders

     None.


Item 5.  Other Information

     None.


Item 6.  Exhibits and Reports on Form 8-K

     (a) Exhibits:

         None

     (b) Reports on Form 8-K:

         Current Report of the Company on Form 8K, as filed on March 6, 2001.



SIGNATURES


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


                                              EASYRIDERS, INC.
                                              ----------------
                                              (Registrant)



Dated: May 11, 2001                           /s/ J. Robert Fabregas
                                              ----------------------------------
                                              J. Robert Fabregas
                                              Chief Executive Officer and Chief
                                              Financial Officer

                                       26