SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                               ------------------

                                    FORM 10-Q

(Mark One)

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

For the quarterly period ended         March 31, 2002
                               -------------------------------------------------

                                       OR

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

For the transition period from                       to
                               ----------------------   ------------------------


                         Commission file number    0-11877
                                               --------------

                                ELXSI CORPORATION
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)


           Delaware                                     77-0151523
--------------------------------------------------------------------------------
 (State or other jurisdiction               (I.R.S. employer identification no.)
of incorporation or organization)



3600 Rio Vista Avenue, Suite A, Orlando, Florida                 32805
--------------------------------------------------------------------------------
   (Address of principal executive offices)                    (Zip code)


Registrant's telephone number, including area code:       (407) 849-1090
                                                   -----------------------------

--------------------------------------------------------------------------------
              (Former name, former address and former fiscal year,
                         if changed since last report.)


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes [X]      No [ ]


On May 9, 2002, the registrant had outstanding 4,027,997 shares of Common Stock,
par value $0.001 per share.

<PAGE>

This Quarterly Report on form 10-Q (this "10-Q") includes forward-looking
statements, particularly in the "Management's Discussion and Analysis of
Financial Condition and Results of Operations" section (Item 2 herein).
Additional written or oral forward-looking statements may be made by or on
behalf of the Company from time to time, in filings with the Securities and
Exchange Commission, in press releases and other public announcements, or
otherwise. All such forward-looking statements are within the meaning of that
term in Section 27A of the Securities Act of 1933, as amended, and Section 21E
of the Securities Exchange Act of 1934, as amended. Such statements may include,
but not be limited to, projections of revenue, income, losses and cash flows,
plans for future capital and other expenditures, plans for future operations,
financing needs or plans, plans relating to products or services, estimates
concerning the effects of litigation or other disputes, as well as expectations
and assumptions relating to any or all of the foregoing, relating to the
Company, its subsidiaries and/or divisions.

Although the Company believes that its forward-looking statements are based on
expectations and assumptions that are reasonable, forward-looking statements are
inherently subject to risks and uncertainties, some of which can not be
predicted. Accordingly, no assurance can be given that such expectations or
assumptions will prove to have been correct, and future events and actual
results could differ materially from those described in or underlying the
forward-looking statements. Among the factors that could cause future events and
actual results to differ materially are: the demand for the Company's products
and services and other market acceptance risks; the presence in the Company's
markets of competitors with greater financial resources, and the impact of
competitive products and services and pricing; the loss of any significant
customers or group of customers; general economic and market conditions
nationally and (in the case of Bickford's) in New England; the ability of Cues
to develop new products; capacity and supply constraints or difficulties; the
emergence of future opportunities; the Company's ability to collect certain
related party notes receivable; changes in the value of certain investments
pledged to secure related party receivables; the Company's ability to obtain new
financing necessary to replace outstanding borrowings before they mature in less
than one year; the Company's ability to meet certain covenant requirements under
its borrowing agreements; the ability of the Company to utilize its deferred tax
assets; the Company's ability to collect outstanding accounts receivable; the
effects of the Company's accounting policies; and the impact of new accounting
pronouncements.

More detail regarding these and other important factors that could cause actual
results to differ materially from such expectations, assumptions and
forward-looking statements ("Cautionary Statements") may be disclosed in this
10-Q, other Securities and Exchange Commission filings and other public
announcements of the Company. All subsequent written and oral forward-looking
statements attributable to the Company, its subsidiaries or divisions or persons
acting on their behalf are expressly qualified in their entirety by the
Cautionary Statements.

The Company assumes no obligation to update its forward-looking statements or
advise of changes in the expectations, assumptions and factors on which they are
based.

                                        2
<PAGE>

                          Part I. FINANCIAL INFORMATION

Item 1.  Financial Statements


                                ELXSI CORPORATION
                           CONSOLIDATED BALANCE SHEETS
                             (Dollars in Thousands)

                                   A S S E T S


                                                       March 31,    December 31,
                                                         2002          2001
                                                      -----------   -----------
                                                       Unaudited
Current assets:

     Cash and cash equivalents                        $     1,109   $     1,194

     Accounts receivable, net                               5,378         6,116

     Income taxes receivable                                  334         1,630

     Inventories                                           14,142        14,734

     Prepaid expenses and other current assets                344           450

     Deferred tax asset                                     3,879         3,879
                                                      -----------   -----------

         Total current assets                              25,186        28,003

Property, buildings and equipment, net                     33,931        34,588

Intangible assets, net                                      4,970         4,989

Deferred tax asset - noncurrent                            10,875        10,140

Deferred charge                                             9,425         9,913

Other                                                         768           821
                                                      -----------   -----------

         Total assets                                 $    85,155   $    88,454
                                                      ===========   ===========


              The accompanying notes are an integral part of these
                       consolidated financial statements.

                                        3
<PAGE>

                                ELXSI CORPORATION
                     CONSOLIDATED BALANCE SHEETS (Continued)
                             (Dollars in Thousands)

                      LIABILITIES AND STOCKHOLDERS' EQUITY

                                                       March 31,    December 31,
                                                         2002          2001
                                                      -----------   -----------
                                                       Unaudited
Current liabilities:
     Accounts payable                                 $     2,645   $     2,585
     Accrued expenses                                       6,533         6,399
     Capital lease obligations - current                      109           105
     Current portion of long-term debt                     15,455        18,953
     Other current liabilities                              2,728         2,728
                                                      -----------   -----------
         Total current liabilities                         27,470        30,770

Capital lease obligations - non current                       998         1,011
Long-term debt                                                391           404
Other non current liabilities                                 910           910
                                                      -----------   -----------

         Total liabilities                                 29,769        33,095
                                                      -----------   -----------

Commitments and contingencies

Stockholders' equity:
   Preferred stock, Series A Non-voting
     Convertible, par value $0.002 per share
       Authorized--5,000,000 shares
       Issued and outstanding--none                            --            --
   Common stock, par value $0.001 per share
       Authorized--60,000,000 shares
       Issued and outstanding--4,027,997
         at March 31, 2002 and
         December 31, 2001                                      4             4
   Additional paid-in capital                             221,246       221,246
   Notes receivable - related parties                     (11,972)      (11,972)
   Accumulated deficit                                   (153,424)     (153,414)
   Accumulated other comprehensive income                    (468)         (505)
                                                      -----------   -----------

         Total stockholders' equity                        55,386        55,359
                                                      -----------   -----------

         Total liabilities and stockholders' equity   $    85,155   $    88,454
                                                      ===========   ===========


              The accompanying notes are an integral part of these
                       consolidated financial statements.

                                        4
<PAGE>

                                ELXSI CORPORATION
                    CONSOLIDATED STATEMENTS OF INCOME (LOSS)
                  (Amounts in Thousands, Except Per Share Data)
                                   (Unaudited)



                                                    Three Months Ended March 31,
                                                     -------------------------
                                                        2002          2001
                                                     -----------   -----------


Net sales                                            $    25,282   $    24,101

Costs and expenses:
     Cost of sales                                        21,315        20,586
     Selling, general and administrative                   2,562         2,757
     Depreciation and amortization                         1,118         1,170
                                                     -----------   -----------

Operating income (loss)                                      287          (412)

Other income (expense):
     Interest income                                          --           332
     Interest expense                                       (433)         (339)
     Other (expense) income                                  (14)            1
                                                     -----------   -----------

Loss before income tax benefit                              (160)         (418)

Income tax benefit                                           150           158
                                                     -----------   -----------

Net loss                                                     (10)         (260)

Other comprehensive income (loss) net of tax:
   Foreign currency translation adjustment                    (7)          (33)
   Adjustment for cash flow hedge                             44            --
                                                     -----------   -----------

Comprehensive income (loss)                          $        27   $      (293)
                                                     ===========   ===========

Net loss per common share:
     Basic                                           $        --   $      (.06)
                                                     ===========   ===========
     Diluted                                         $        --   $      (.06)
                                                     ===========   ===========

Weighted average number of common
  and common equivalent shares:
       Basic                                               4,028         4,089
                                                     ===========   ===========
       Diluted                                             4,028         4,089
                                                     ===========   ===========


              The accompanying notes are an integral part of these
                       consolidated financial statements.

                                        5
<PAGE>

                                ELXSI CORPORATION
                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                  (Amounts in Thousands, Except Common Shares)
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                                                           Accumulated
                                           Common Stock          Additional      Related       Accum-         Other
                                     -------------------------     Paid-In-       Party        ulated      Comprehensive
                                       Shares        Dollars       Capital        Notes        Deficit     Income (Loss)
                                     -----------   -----------   -----------   -----------   -----------   -----------

<S>                                    <C>         <C>           <C>           <C>           <C>           <C>
Balance at December 31, 2001           4,027,997   $         4   $   221,246   $   (11,972)  $  (153,414)  $      (505)
Foreign currency translation
   adjustment, net of tax                     --            --            --            --            --            (7)
Adjustment to recognize fair value
   of cash flow hedge, net of tax             --            --            --            --            --            44
Net loss                                      --            --            --            --           (10)           --
                                     -----------   -----------   -----------   -----------   -----------   -----------

Balance at March 31, 2002              4,027,997   $         4   $   221,246   $   (11,972)  $  (153,424)  $      (468)
                                     ===========   ===========   ===========   ===========   ===========   ===========
</TABLE>


              The accompanying notes are an integral part of these
                       consolidated financial statements.

                                        6
<PAGE>

                                ELXSI CORPORATION
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                             (Dollars in Thousands)
                                   (Unaudited)
<TABLE>
<CAPTION>

                                                             Three Months Ended March 31,
                                                             -------------------------
                                                                2002          2001
                                                             -----------   -----------
<S>                                                          <C>           <C>
Cash flows provided by (used in) operating activities:
Net loss                                                     $       (10)  $      (260)
Adjustments to reconcile net loss to net cash
    provided by (used in) operating activities:
     Depreciation and amortization                                 1,118         1,170
     Amortization of deferred debt costs                              74            45
     Loss on disposal of equipment                                   (14)           --

(Increase) decrease in assets:
     Accounts receivable                                             738          (143)
     Income tax receivable                                         1,296            --
     Inventories                                                     592          (876)
     Prepaid expenses and other current assets                       106          (148)
     Deferred tax asset                                             (735)         (158)
     Deferred charge                                                 488            --
     Other                                                            42           (95)
(Decrease) increase in liabilities:
     Accounts payable                                                 60           (62)
     Accrued expenses                                                134        (2,449)
                                                             -----------   -----------
     Net cash provided by (used in) operating activities           3,889        (2,976)
                                                             -----------   -----------

Cash flows used in investing activities:
     Purchase of property, building and equipment                   (428)         (559)
     Investment in notes receivable - related party                   --          (256)
                                                             -----------   -----------
       Net cash used in investing activities                        (428)         (815)
                                                             -----------   -----------

Cash flows (used in) provided by financing activities:
     Net borrowings (payments) on line of credit                  (3,447)        6,472
     Payments of long-term debt                                      (64)          (66)
     Purchase of Common Stock                                         --        (1,064)
     Proceeds from exercise of Common Stock
         options                                                      --            22
     Payment of deferred bank fee                                    (26)          (61)
     Principal payments on capital lease obligations                  (9)          (14)
                                                             -----------   -----------
     Net cash (used in) provided by financing activities          (3,546)        5,289
                                                             -----------   -----------
</TABLE>


              The accompanying notes are an integral part of these
                       consolidated financial statements.

                                        7
<PAGE>

                                ELXSI CORPORATION
                CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
                             (Dollars in Thousands)
                                   (Unaudited)

                                                  Three Months Ended March 31,
                                                  --------------------------
                                                      2002          2001
                                                  ------------   -----------

(Decrease) increase in cash and cash equivalents   $       (85)  $     1,498

Cash and cash equivalents, beginning of period           1,194           379
                                                   -----------   -----------

Cash and cash equivalents, end of period           $     1,109   $     1,877
                                                   ===========   ===========


Supplemental Disclosure of Cash Flow Information

Cash paid during the period for:
    Income taxes                                   $       260   $     1,900
    Interest                                               361           322


              The accompanying notes are an integral part of these
                       consolidated financial statements.

                                        8
<PAGE>

                                ELXSI CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                 March 31, 2001
                                   (Unaudited)

Note 1.  The Company

General. ELXSI Corporation (together with its subsidiary, the "Company")
operates principally through its two wholly-owned subsidiaries, ELXSI, a
California corporation ("ELXSI"), and Bickford's Family Restaurants, Inc., a
Delaware corporation ("BFRI"). Operations consist of a restaurant chain in New
England and an equipment manufacturer in Orlando, Florida.

Restaurant Operations. On July 1, 1991, ELXSI acquired 30 Bickford's Restaurants
and 12 Howard Johnson's Restaurants located in Massachusetts, Vermont, New
Hampshire, Rhode Island and Connecticut.

On December 30, 2000, EXLSI contributed and transferred to a newly-formed,
wholly owned subsidiary, Bickford's Holdings Company, Inc. ("BHC"), the
Bickford's Restaurants and substantially all of their related operations, assets
and liabilities. Immediately thereafter, these Restaurants, operations, assets
and liabilities were contributed and transferred by BHC to another newly-formed,
wholly-owned subsidiary, BFRI.

As of March 31, 2002 ELXSI operates 67 Bickford's Restaurants (the "Restaurants"
or "Restaurant Operations").

Equipment Manufacturer. On October 30, 1992, ELXSI acquired Cues, Inc. of
Orlando, Florida and its two wholly-owned subsidiaries Knopafex, Ltd., a
Canadian company, and Cues B.V., a Dutch company, collectively referred to
herein as "Cues" or "Cues Division".

Cues is engaged in the manufacturing and servicing of video inspection and
repair equipment for wastewater and drainage systems primarily for governmental
municipalities, service contractors and industrial users.

Recent Accounting Pronouncements

FAS No. 141, "Business Combinations" and FAS No. 142, "Goodwill and Other
Intangible Assets", were issued in July 2001. FAS 141 requires all business
combinations initiated after June 30, 2001 to be accounted for using the
purchase method of accounting. FAS 141 also specifies the criteria which must be
met in order for certain acquired intangible assets to be recorded separately
from goodwill. FAS 142 became effective for the Company beginning with the first
quarter of 2002. Under FAS 142, goodwill is no longer amortized but rather will
be tested for impairment annually, or more frequently if events or changes in
circumstances indicate that the asset might be impaired. This new approach
requires the use of valuation techniques and methodologies significantly
different than the prior, undiscounted cash flow policy utilized by the Company.
In connection with the adoption of FAS 142, the Company's conclusions about the
valuation and recoverability of goodwill may change. The new approach may result
in impairment charges and reductions in the carrying amount of goodwill on its
consolidated balance sheets. As a result, the Company may be subject to earnings
volatility if additional

                                        9
<PAGE>

goodwill impairment occurs at a future date. The Company is in the process of
performing the goodwill evaluation required under FAS 142 and accordingly, has
not yet determined the extent of any impact.

FAS No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets"
was issued in August 2001. FAS 144, which became effective beginning with the
Company's first quarter of fiscal 2002, establishes a single accounting model
for long-lived assets to be disposed of by sales and also broadens the
presentation of discontinued operations to include more disposal transactions.
The adoption of FAS 144 had no impact on the consolidated financial statements.

On April 30, the Financial Accounting Standards Board issued FAS 145,
"Rescission of FASB Statements No. 4, 44 and 64, Amendment of FASB Statement No.
13, and Technical Corrections". FAS 145 eliminates the requirement that gains
and losses from the extinguishment of debt be aggregated and, if material,
classified as an extraordinary item, net of the related income tax effect and
eliminates an inconsistency between the accounting for sale-leaseback
transactions and certain lease modifications that have economic effects that are
similar to sale-leaseback transactions. Generally, FAS 145 is effective for
transactions occurring after May 15, 2002. The adoption of this standard is
expected to have no impact to the Company.

Note 2.  Basis of Presentation.

The unaudited consolidated financial statements included herein have been
prepared by the Company, without audit, pursuant to the rules and regulations of
the Securities and Exchange Commission. Certain information and footnote
disclosure normally included in financial statements prepared in accordance with
generally accepted accounting principles have been omitted pursuant to such
rules and regulations, although the Company believes that the disclosures are
adequate to make the information presented not misleading. It is suggested that
these financial statements be read in conjunction with the financial statements
and the notes thereto included in the Company's latest annual report on Form
10-K. In the opinion of the Company, all adjustments (solely of a normal
recurring nature) necessary to present fairly the consolidated financial
position of ELXSI Corporation and its subsidiaries as of March 31, 2002, and the
results of their operations and cash flows for the three months ended March 31,
2002 and 2001, have been included. The results of operations for such interim
periods are not necessarily indicative of the results for the entire year.

Note 3. Earnings (Loss) Per Share.

Basic earnings (loss) per share is calculated by dividing income (loss) by the
weighted-average number of shares outstanding during the reporting period.
Diluted earnings (loss) per share reflects the potential dilution that could
occur if options or warrants to issue common stock were exercised. The
weighted average number of shares used in calculating basic loss per share were
4,028,000 and 4,089,000 for the three months ended March 31, 2002 and 2001,
respectively. Options and warrants to purchase an aggregate 1,196,000 and
1,201,000 shares of common stock at March 31, 2002 and 2001, respectively, were
not included in the diluted loss per share calculations for the three months
then ended since the effect would be antidilutive.

                                       10
<PAGE>

Note 4.  Accounts Receivable - Related Party

As of December 31, 2001, the Company restructured the notes receivable from two
related parties, ELX Limited Partnership ("ELX") and Cadmus Corporation
("Cadmus"). The due dates of the notes were extended to April 1, 2005 in
exchange for collateralization of the notes under pledge and security
agreements. In addition, Alexander M. Milley, the Company's Chairman, President
and Chief Executive Officer and most significant stockholder, and certain other
entities that he controls, personally guaranteed the Cadmus and ELX notes. Under
the new, restructured notes, approximately 821,705 of issued and outstanding
shares of Common Stock of the Company, held by these companies under Mr.
Milley's control serve as the primary collateral. The collateral also includes
shares of other publicly traded companies and other assets held by Mr. Milley
and these related companies. All interest and principal payable under these
notes is due on the maturity date at rates previously in existence. As a result
of these extensions and revisions in the underlying collateral, the aggregate
balance of these notes receivable at March 31, 2002 and December 31, 2001 has
been reflected in the equity section of the consolidated balance sheet as a
contra-equity. Interest will be recorded as income when actually received, as
the underlying collateral included in the pledge and security agreements will
not support an increase to the related party notes receivable balance.

Note 5.  Composition of Inventory.

Inventory is summarized in the following table.
                                                     March 31,      December 31,
                                                       2002            2001
                                                    -----------     -----------
Inventories:
     Raw materials and finished goods               $ 9,106,000     $ 8,506,000
     Work in process                                  5,036,000       6,228,000
                                                    -----------     -----------
                                                    $14,142,000     $14,734,000
                                                    ===========     ===========

Note 6.  Segment Reporting.

The Company has two reportable segments, restaurant operations and equipment
manufacturing. The Company is primarily organized into two strategic business
units, which have separate management teams and infrastructures and that offer
different products and services. Each business requires different employee
skills, technology, and marketing strategies. The restaurant operations segment
includes 67 Restaurants located in the New England States operating under the
Bickford's brand name. The equipment manufacturing segment produces sewer
inspection equipment for sale to municipalities, contractors, and foreign
governments.

The Company evaluates the performance of each segment based upon profit or loss
from operations before income taxes, interest, non-recurring gains and losses
and foreign exchange gains and losses.

There has been no significant difference in the basis of segmentation or in the
measurement of segment profit since the Company's last annual report on Form
10-K for the year ended December 31, 2001. The "Other" lines include corporate
related items; results of insignificant operations and, as they relate to profit
and losses, income and expense not allocated to reportable segments.

                                       11
<PAGE>

Summarized financial information by business segment for the three months ended
March 31, 2002 and March 31, 2001 is summarized in the following table.

                                                   2002               2001
                                               -------------      -------------
Revenues from external customers:
     Restaurants                               $  16,898,000      $  17,781,000
     Equipment                                     8,384,000          6,320,000
                                               -------------      -------------
                                               $  25,282,000      $  24,101,000
                                               =============      =============
Segment (loss) profit:
     Restaurants                               $     225,000      $    (143,000)
     Equipment                                       184,000             66,000
     Other                                          (122,000)          (335,000)
                                               -------------      -------------
                                               $     287,000      $    (412,000)
                                               =============      =============
Segment assets:
     Restaurants                               $  35,579,000      $  33,440,000
     Equipment                                    26,706,000         25,779,000
     Other                                        22,870,000         45,849,000
                                               -------------      -------------
                                               $  85,155,000      $ 105,068,000
                                               =============      =============

There were no inter-segment sales or transfers during the first three months of
2002 or 2001. Operating income by business segment excludes interest income,
interest expense, and other income and expenses. "Other" assets consists
principally of the accounts and notes receivable from related parties, interest
receivable, the deferred tax asset and the other prepaid asset.

Note 7.  Long-Term Debt.

Under the terms of its line of credit and term loan agreement with Bank of
America ("BofA"), the Company is required to meet certain financial and other
qualitative covenants, including the ratio of funded debt to earnings before
interest, taxes, depreciation and amortization ("EBITDA"), a fixed charge
coverage ratio and restrictions on capital expenditures. At December 31, 2001,
the Company was in violation of the funded debt to EBITDA covenant and other
non-financial covenants, and therefore was in default under the provisions of
this credit agreement. On April 22, 2002, the Company obtained a waiver from
BofA for the covenant violations under an Amended and Restated Loan and Security
Agreement (the "New Credit Agreement") with BofA. The New Credit Agreement
includes the following terms, which represent changes from the prior credit
agreements: (1) an additional $1,000,000 term loan principal payment on or
before August 31, 2002; (2) interest at BofA's prime rate plus 2%; (3)
acceleration of the maturity date from December 31, 2003 to January 1, 2003; (4)
the requirement to terminate the Company's interest rate swap with BofA; and (5)
acceleration of the maturity date of the Company's IDB bonds from September 2012
to January 1, 2003.

The Company was in compliance with the revised terms and covenants of the New
Credit Agreement as of March 31, 2002; however, the New Credit Agreement
contains provisions which allow BofA to accelerate payment of the amounts due
under the New Credit Agreement if they determine that a material adverse change
has occurred in the Company. The Company's consolidated financial statements at
December 31, 2001 included a report of independent certified public accountants,
which indicated that these provisions raise substantial doubt as to

                                       12
<PAGE>

the Company's ability to continue as a going concern. Management believes it
will be successful in obtaining financing to replace the amounts due under the
New Credit Agreement and IDB bonds prior to January 1, 2003. In the event that
sufficient additional financing cannot be obtained prior to the maturity date to
repay the amounts due thereunder, the Company believes several options are
available to generate additional liquidity.

Note 8.  Derivative Instrument.

The Company used a derivative instrument to manage a portion of its exposure to
variable interest rates on outstanding bank debt. This interest rate swap
agreement provided for a 7.5% fixed rate of interest on $7 million of variable
interest rate loans under ELXSI's bank line of credit through March 2002 and
$4.0 million for the subsequent 12 months. This interest rate swap agreement
was utilized to provide an exchange of interest payments computed on notional
principal amounts to offset any undesirable changes in cash flows or fair values
resulting from market rate changes on designated hedged bank borrowings. The
credit risk of the interest rate swap agreement had been limited by the fact
that ELXSI's counterparty thereunder is a major financial institution. During
the three months ended March 31, 2002, the Company recorded a net gain of
$44,000, net of tax of $25,000, in "Other comprehensive income (loss)" related
to this cash flow hedge. The Company terminated the interest rate swap agreement
in April 2002 in conjunction with the execution of the New Credit Agreement,
resulting in a termination payment of approximately $112,000. This impact of
the termination has not been included in the consolidated financial statements
as of March 31, 2002.


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

RESULTS OF OPERATIONS

The Company's revenues and expenses result from the operation of the Restaurant
Operations and Cues Division and the Company's corporate expenses ("Corporate").

COMPARISON OF FIRST QUARTER 2002 RESULTS TO FIRST QUARTER 2001 RESULTS

The first quarter sales increased $1,181,000, gross profit increased $452,000,
selling, general and administrative expense decreased $195,000 and depreciation
and amortization decreased $52,000, resulting in an operating income increase of
$699,000. Interest expense increased by $94,000, interest income decreased by
$332,000, other expense increased by $15,000 and income tax benefit decreased by
$8,000. The Company recorded a net loss of $10,000 in the first quarter of 2002
compared to net loss of $260,000 in the corresponding period of the prior year.

Restaurant Operations. Restaurant sales decreased by $883,000, or 5.0%, and
gross profit increased by $401,000, or 27.2%, in the first quarter of 2002
compared to the same period in the prior year. The sales decrease was mainly due
to a decrease in same store sales of $660,000, or 4.1%, a decrease in sales due
to closed and non-comparable Restaurants of $115,000 and a decrease in sales at
new Bickford's Restaurants of $107,000. Customer counts at Restaurants operated
in both periods decreased 10.3% primarily due to the continuing effect of the
economy, new competition and the implementation of local non-smoking regulations
in additional communities during the first quarter of 2002.

                                       13
<PAGE>

Offsetting the effect of the sales decrease was a 2.8% increase in the gross
profit percentage from 8.3% to 11.1%. As a result, Restaurant gross profit
increased by $401,000, or 7.2%, in the first quarter of 2002 compared to the
same period in 2001. The increase in the gross profit percentage was mainly the
result of a decrease in food costs and variable costs as percentages of sales.
Food costs decreased primarily as a result of the Company's selectively changing
certain food products and vendors, resulting in lower costs while maintaining
quality. The decrease in variable costs resulted from lower utility and snow
removal costs related to the milder winter weather in the first quarter of 2002
compared to the same period in 2001.

Restaurant selling, general and administrative expense increased by $50,000, or
8.1%, during the first quarter of 2002 compared to the same period in the prior
year. There were no individually significant items that made up the increase
during the quarter.

Restaurant depreciation and amortization decreased by $17,000, or 1.7%, during
the first quarter of 2002 compared to the same period in the prior year.

As a result of the above items, operating income increased by $368,000 in the
first quarter of 2002 compared to the first quarter of 2001.

Cues Division. Cues's sales increased by $2,064,000, or 32.7%, in the first
quarter of 2002 compared to the same period in the prior year. The sales
increase resulted mainly from an increase in sales of truck-mounted systems.
However, further decreases in the gross profit percentage due to competitive
pricing pressures limited the gross profit increase to $51,000, or 2.5% compared
to the same period in the prior year.

Operating income increased by $118,000 to $184,000. Included in the increase in
operating income were the effects of a decrease in selling, general and
administrative expense of $32,000, or 1.8%, and a decrease in depreciation and
amortization expense of $35,000, or 21.1%. The decrease in selling, general and
administrative expenses in the first quarter of 2002 compared to the
corresponding period in the prior year is primarily attributable to a reduction
in international sales expense partially offset by an increase in domestic sales
and support expense. The staffing increases in sales, manufacturing and
engineering during 2001 were implemented in anticipation of achieving increased
sales volume, which occurred in each of the last four quarters prior to and
including the quarter ended March 31, 2002.

Corporate. Corporate general and administrative expenses decreased by $213,000,
or 63.6%, during the first quarter of 2002, primarily as a result of
discontinuing the Cadmus management fee due to the failure to achieve $4.0
million in operating income during 2001. The management fee can be reinstated
upon achieving annual operating income of $4.0 million.

Consolidated interest expense increased by $94,000, or 27.7%, due to a higher
average debt balance in 2002 partially offset by lower interest rates.
Consolidated interest income decreased by $332,000 and other expense increased
$15,000 in the first quarter of 2002 compared to the same period in 2001.
Interest income decreased due to discontinuing the recording of interest
receivable on the related party debt due from Cadmus and ELX. The principal and
interest on the related party notes receivable are due in April 2005. Interest
will be recorded as income when actually received, as the underlying collateral
included in the pledge and security agreements will not support an increase to
the related party notes receivable balance.

                                       14
<PAGE>

Income tax benefit decreased by $8,000 from $158,000 in the first quarter of
2001 to $150,000 in the first quarter of 2002. Both periods included non-cash
expense resulting from calculating the deferred tax provision in accordance with
Financial Accounting Standards Board Statement No. 109 "Accounting For Income
Taxes". The tax benefit in the first quarter of 2002 included a deferred tax
benefit of $271,000, while the corresponding period in the prior year included
deferred tax benefit of $108,000.

Loss Per Share. The loss per share for the first quarter ended March 31, 2002
was $.00 compared to a loss per share of $.06 for the first quarter ended March
31, 2001. The basic and diluted weighted average number of shares outstanding
for the quarter ended March 31, 2002 and 2001 was 4,028,000 and 4,089,000,
respectively. The decrease in the number of average shares results from stock
repurchases during the first and second quarters of 2001. The average stock
market price for the first quarter of 2002 was $8.34 compared to an average of
$10.43 in the corresponding period of 2001.

Liquidity and Capital Resources

Available Resources. The Company's consolidated cash positions at March 31, 2002
and December 31, 2001 were $1,109,000 and $1,194,000, respectively. The Company
has a cash management system whereby cash generated by operations is used to
reduce bank debt. The reduction of outstanding debt provides the Company with a
reduction in interest expense greater than the interest income that cash could
safely earn from alternative investments. Working capital needs, when they
arise, are met by daily borrowings.

On April 22, 2002, the Company entered into an Amended and Restated Loan and
Security Agreement (the "New Credit Agreement") with its lender, Bank of
America, N.A. ("BofA") which contains language regarding potential "material
adverse changes", which is similar to language in prior credit agreements. Due
to the subjective nature of these clauses, the lender can declare the Company's
primary bank credit facility to be in default and accelerate the maturity date
thereof. In the event of acceleration, the Company would be required to repay
principally all of its debt. As a result, PricewaterhouseCoopers LLP has
indicated in their audit report for the year ended December 31, 2001, that, in
the event of acceleration, it would raise substantial doubt about the Company's
ability to continue as a going concern. The Company expects to be profitable and
to generate cash during 2002, which will be used to reduce its long-term debt.
As of March 31, 2002, the Company had increased availability under its $15.0
million line of credit to approximately $3,886,000. In addition, management
believes that it will be successful in obtaining refinancing of all of its BofA
debt prior to its maturity in January 2003. In the event that sufficient
additional financing cannot be obtained prior to the maturity date to repay
amounts due under the New Credit Agreement, management believes several other
options are available to generate additional liquidity.

During the first quarter of 2002, the Company had cash flow from operations of
$3,889,000. This cash flow was generated primarily from collection of tax
refunds, accounts receivable and a reduction in inventory. The cash flow from
operations was used to reduce the Company's line of credit by $3,447,000,
purchase property, plant and equipment totaling $428,000, reduce long-term debt
by $64,000, pay deferred fees of $26,000 and pay off capital leases obligations
of $9,000. During the first quarter of 2002, current assets decreased by
$2,817,000 primarily due to

                                       15
<PAGE>

a decrease in Cues's inventory, the collection of tax refunds and reductions in
accounts receivable. Current liabilities decreased $3,300,000 mainly due to a
decrease in bank debt.

During the first quarter of 2001, the Company used cash in operations of
$2,976,000. Borrowings on the line of credit of $6,472,000 and proceeds from
stock option exercises of $22,000 funded the cash used in operations of
$2,976,000, the acquisition of property, plant and equipment totaling $559,000,
an increase in related party notes receivable of $256,000, payment of long-term
debt of $66,000, the purchase of Common Stock of $1,064,000, payment of deferred
bank fees of $61,000 and the payment of capital leases obligations of $14,000.
During the first quarter of 2001, current assets increased by $2,665,000
primarily due to an increase in Cues inventory and Bickford's cash. Current
liabilities decreased $2,511,000 mainly due to a decrease in accrued expenses.

Future Needs For and Sources of Capital. Management believes that cash generated
by operations plus cash available under the New Credit Agreement will be
sufficient to fund operations through January 1, 2003, including interest and
principal payments on bank debt and payments due under its phantom stock option
plan. Management believes that the bank line of credit and term loan with BofA
under the New Credit Agreement will be refinanced prior to its maturity date of
January 1, 2003.

Impact of Inflation. Inflationary factors such as increases in food and labor
costs directly affect the Company's operation. Many of the Restaurants'
employees are paid hourly rates related to the federal minimum wage, and,
accordingly, increases in the minimum wage will result in increases in the
Company's labor costs. In addition, the cost of food commodities utilized by the
Company is subject to market supply and demand pressures. Shifts in these costs
may have an impact on the Company's cost of sales. The Company anticipates that
food cost increases can be offset through selective price increases, although no
assurances can be given that the Company will be successful in this regard.

Item 3.  Quantitative and Qualitative Disclosures About Market Risk

The Company is exposed to market risk from changes in interest rates on borrowed
funds, which could affect its results of operations and financial condition. At
March 31, 2002, the Company has approximately $15.1 million in variable,
market-rate based debt outstanding. A 10% increase in interest rates would
result in approximately $1.5 million in additional interest expense annually
based on the current borrowing levels.

                           PART II. OTHER INFROMATION

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

     (a) Exhibits required by Item 601 of Regulation S-K.

                  None

     (b) Reports on Form 8-K.

                  None

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<PAGE>

                                   SIGNATURES


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


                                                ELXSI CORPORATION
                                     -------------------------------------------
                                                   (Registrant)



Date: May 10, 2002                   /s/ ALEXANDER M. MILLEY
                                     -------------------------------------------
                                     Alexander M. Milley, Chairman of the Board,
                                      President and Chief Executive Officer
                                      (Principal Executive Officer)




Date: May 10, 2002                   /s/ DAVID M. DOOLITTLE
                                     -------------------------------------------
                                     David M. Doolittle, Vice President,
                                      Treasurer, Secretary and Chief Financial
                                      Officer (Chief Accounting Officer and
                                      Principal Financial Officer)


                                       17