================================================================================
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


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                                    FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES  EXCHANGE ACT
OF 1934

For the quarterly period ended September 30, 1999

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

         For the transition period from ________________________

         Commission File Number: 0-29292


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                               HAGLER BAILLY, INC.
             (Exact name of registrant as specified in its charter)
--------------------------------------------------------------------------------


Delaware   54-1759180   (State  or  other   jurisdiction  of   incorporation  or
organization) I.R.S. Employer Identification Number

              1530 Wilson Boulevard, Suite 400, Arlington, VA 22209
               (Address of principal executive offices) (Zip Code)


                                  703-351-0300
              (Registrant's telephone number, including area code)

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 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(XX) No(  )

As of October 31, 1999, the Registrant had 17,911,477 shares of its common stock
outstanding.



<PAGE>



23

                                        i
                                TABLE OF CONTENTS


Item 1.  Financial Statements..................................................1

 Consolidated Balance Sheets as of September 30, 1999 (Unaudited) and
     December 31, 1998.........................................................1
 Consolidated Statements of Operations for the Three and Nine Months
     Ended September 30, 1999 and 1998 (Unaudited).............................2
 Consolidated Statements of Cash Flows for the Nine Months
     Ended September 30, 1999 and 1998 (Unaudited).............................3
 Notes To Consolidated Financial Statements....................................4

 ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF
 FINANCIAL CONDITION AND RESULTS OF OPERATIONS.................................5




                                     Part II



Item 1. Legal Proceedings.....................................................16


Item 2.  Changes in Securities................................................16


Item 6.  Exhibits and Reports on Form 8-K.....................................17


SIGNATURES....................................................................23









<PAGE>


                                     PART I

Item 1.  Financial Statements
<TABLE>
<CAPTION>
                               Hagler Bailly, Inc.
                           Consolidated Balance Sheets
                                 (in thousands)
                                                                                      September 30,        December 31,
                                                                                           1999                1998
                                                                                    ---------------------------------------
<S>                                                                                 <C>                      <C>

Assets                                                                                 (unaudited)
Current assets:
       Cash & cash equivalents                                                               $  13,495           $  16,165
       Accounts receivable, net of allowance of $4,839 and $3,888
            at September 30, 1999 and December 31, 1998, respectively                           65,246              59,092
       Note receivable                                                                               -                 382
       Prepaid expenses                                                                          2,763               2,620
       Other current assets                                                                        865                 304
                                                                                    ------------------- -------------------
Total current assets                                                                            82,369              78,563
Property and equipment, net                                                                      8,278               6,463
Software development costs, net                                                                    349                 898
Intangible assets, net                                                                          28,808              14,208
Other assets                                                                                     1,226               1,290
                                                                                    ------------------- -------------------
Total assets                                                                                 $ 121,030           $ 101,422
                                                                                    =================== ===================
                                                                                    =================== ===================
Liabilities and stockholders' equity
 Current liabilities:
       Accounts payable and accrued expenses                                                 $  12,425            $  8,476
       Accrued compensation and benefits                                                        12,517               8,713
       Billings in excess of cost                                                                2,975               2,288
       Current portion of long-term debt                                                           333                 345
       Income taxes payable                                                                        908               2,547
       Deferred taxes                                                                            1,900               1,900
                                                                                    ------------------- -------------------
Total current liabilities                                                                       31,058              24,269
Long-term debt, net of current portion                                                             674                 681
Minority interest                                                                                  260                 177
Deferred income taxes                                                                              927                 927
Other deferred                                                                                   1,853               1,769
                                                                                    ------------------- -------------------
Total liabilities                                                                               34,772              27,823
Stockholders' equity:
       Common stock, $0.01 par value, 50,000 shares authorized;
           17,927 and 16,483 issued and outstanding at September 30,1999                           179                 165
           and December 31, 1998, respectively
       Additional capital                                                                       81,028              72,322
       Retained earnings                                                                         5,254               1,206
       Foreign currency translation                                                              (203)                (94)
                                                                                    ------------------- -------------------
Total stockholders' equity                                                                      86,258              73,599
                                                                                    ------------------- -------------------
                                                                                    =================== ===================
Total liabilities and stockholders' equity                                                   $ 121,030           $ 101,422
                                                                                    =================== ===================
                                                 See accompanying notes.
</TABLE>
<TABLE>
<CAPTION>

                      Consolidated Statements of Operations
                                   (Unaudited)
                      (in thousands, except per share data)



                                                            Three months ended                   Nine months ended
                                                              September 30,                        September 30,
                                                          1999             1998               1999              1998
<S>                                                  <C>              <C>                 <C>               <C>
                                                     ---------------  ----------------  ----------------- ------------------
Revenues:
  Consulting revenues                                     $  47,814         $  44,201         $  131,737         $  127,339
  Other revenues                                                314             2,289              1,178              4,743
                                                     ---------------  ----------------  ----------------- ------------------
Total revenues                                               48,128            46,490            132,915            132,082
Cost of services                                             36,571            33,131            100,911             94,812
                                                     ---------------  ----------------  ----------------- ------------------
Gross profit                                                 11,557            13,359             32,004             37,270
Merger-related and other non-recurring costs                      -             2,493                  -              4,212
Selling, general and administrative expenses                  9,097             6,905             24,841             18,298

Stock and stock option compensation                               -                 -                  -              2,595
                                                     ---------------  ----------------  ----------------- ------------------
Income from operations                                        2,460             3,961              7,163             12,165
Other income (expenses), net                                  (122)               258               (31)                179
                                                     ---------------  ----------------  ----------------- ------------------
Income before income tax expense and loss from
  equity investment in joint venture                          2,338             4,219              7,132             12,344
Income tax expense                                              981             1,713              2,853              6,008
                                                     ---------------  ----------------  ----------------- ------------------
Income before loss from equity investment in joint
  venture                                                     1,357             2,506              4,279              6,336
Loss from equity investment in joint venture,
  net of tax                                                    (1)                 -              (231)                  -
                                                     ---------------  ----------------  ----------------- ------------------
Net income                                                 $  1,356          $  2,506          $   4,048          $   6,336
                                                     ===============  ================  ================= ==================
                                                     ===============  ================  ================= ==================

Net income per share:
 Basic                                                     $   0.08          $   0.15           $   0.24           $   0.38
 Diluted                                                   $   0.08          $   0.15           $   0.23           $   0.36
Weighted average shares outstanding:
  Basic                                                      17,267            16,195             16,779             16,636
                                                     ===============  ================  ================= ==================
                                                     ===============  ================  ================= ==================
   Diluted                                                   17,457            16,939             17,246             17,427
                                                     ===============  ================  ================= ==================
                                                     ===============  ================  ================= ==================

                                                  See accompanying notes.

</TABLE>






<TABLE>
<CAPTION>



                               Hagler Bailly, Inc.
                      Consolidated Statements of Cash Flows
                                   (Unaudited)
                                  in thousands

                                                                             Nine months ended September 30,
                                                                               1999                  1998
                                                                        -------------------   --------------------
<S>                                                                         <C>                      <C>
Operating activities
Net income                                                                         $ 4,048               $  6,336
Adjustments to reconcile net income to net cash provided by
   operating activities:

       Depreciation and amortization expense                                         4,367                  3,480
       Provision for deferred income taxes                                               -                    749
       Provision for accounts receivable                                             2,168                  (626)
       Loss on equity investment in joint venture                                      231                      -
       Minority interest                                                                83                      -
       Disposal of Fixed Assets                                                          -                    175
       Asset impairment                                                                  -                    456
       Amortization of deferred stock compensation                                       -                  2,595
       Changes in operating assets and liabilities:
             Accounts receivable                                                   (6,371)               (14,535)
             Note receivable                                                           382                      -
             Prepaid expenses                                                        (993)                (4,957)
             Other current assets                                                    (535)                (1,914)
             Other assets                                                             (55)                    265
             Accounts payable and accrued expenses                                   1,116                (1,718)
             Accrued compensation and benefits                                       3,211                (5,115)
             Billings in excess of cost                                                569                  (541)
             Income taxes payable                                                  (2,821)                  1,253
             Other deferred                                                             84                      -
                                                                        -------------------   --------------------
Net cash provided by (used in) operating activities                                  5,484               (14,097)
Investing activities
Acquisition of property and equipment                                              (3,329)                (3,596)
Purchase of acquired Companies, net of cash received                                 (847)                (1,100)
                                                                        -------------------   --------------------
Net cash used in investing activities                                              (4,176)                (4,696)
Financing activities
Issuance of common stock                                                               137                      -
Purchase of treasury stock                                                         (4,115)                      -
Sale  of common stock                                                                    -                 12,676
Dividends paid by foreign subsidiary                                                     -                  (333)
Net borrowings from bank line of credit                                                  -                  3,200
Payments on long term debt                                                               -                (1,003)
                                                                        -------------------   --------------------
Net cash (used in) provided by financing activities                                (3,978)                 14,540

Net decrease in cash and cash equivalents                                          (2,670)                (4,253)
Cash and cash equivalents, beginning of period                                      16,165                 11,813
                                                                        ===================   ====================
Cash and cash equivalents, end of period                                          $ 13,495                $ 7,560
                                                                        ===================   ====================

                                             See accompanying notes.
</TABLE>


                               HAGLER BAILLY, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 1.  Basis of Presentation

         The accompanying unaudited interim consolidated financial statements of
Hagler Bailly,  Inc. (the "Company") have been prepared pursuant to the rules of
the Securities  and Exchange  Commission  ("SEC") for quarterly  reports on Form
10-Q and do not include all of the information and note disclosures  required by
generally  accepted  accounting  principles.  The information  furnished  herein
reflects  all  adjustments,  of a normal  recurring  nature,  which are,  in the
opinion of management,  necessary for a fair  presentation  of results for these
interim periods.

         The interim results of operations are not necessarily indicative of the
results to be expected for the entire fiscal year ending December 31, 1999.

Note 2.  Earnings per Share

         Basic  earnings  per share is computed  based on the  weighted  average
number of shares of common  stock  outstanding  during the  respective  periods.
Diluted  earnings per share is inclusive of the dilutive  effect of  unexercised
stock options using the treasury  stock method.  Weighted  average share figures
are as follows (in thousands):
<TABLE>
<CAPTION>

                                                 For the three months ended              For the nine months ended
                                                       September 30,                           September 30,
                                                  1999               1998                 1999              1998
                                                  ----               ----                 ----              ----
<S>                                           <C>                <C>                  <C>                <C>

Net income                                        $1,356             $2,506               $4,048             $6,336
                                            ================= ===================    ================ ==================
                                            ================= ===================    ================ ==================

Weighted average shares of common
   stock outstanding during the period
                                                  17,267             16,195               16,779             16,636

Effect of dilutive securities:
  Stock options                                      190                744                  467                791
                                            ----------------- -------------------    ---------------- ------------------
                                            ----------------- -------------------    ---------------- ------------------

Weighted average shares of common
  stock and dilutive securities
                                                  17,457             16,939               17,246             17,427
                                            ================= ===================    ================ ==================

</TABLE>

Note 3.  Business Combinations

         On February 8, 1999, the Company acquired all of the outstanding  stock
of Lacuna  Consulting  Limited  ("Lacuna"),  a United  Kingdom  corporation,  in
exchange for 65,000 shares of the Company's  common stock.  The  acquisition was
accounted for as a purchase.  Accordingly, the consolidated financial statements
reflect the results of operations of Lacuna since the date of acquisition.  As a
result  of  the  transaction,   the  Company  recorded   intangible   assets  of
approximately $1.4 million.

         On April 30, 1999, the Company acquired all of the outstanding stock of
Washington  International Energy Group, Ltd. ("WIEG"), a Washington,  D.C.-based
worldwide  provider  of energy  and  environmental  policy  consulting  research
services,  in exchange  for 144,210  shares of the  Company's  common  stock and
approximately  $850,000 in cash.  The Company has the right to  repurchase up to
26,210 of these  shares  at $ .01 cents per share if the price of the  Company's
stock meets  certain price  targets  during the three year period  following the
acquisition.  The transaction was accounted for as a purchase.  Accordingly, the
consolidated  financial  statements  reflect the results of  operations  of WIEG
since the date of  acquisition.  As a result  of the  transaction,  the  Company
recorded intangible assets of approximately $1.5 million.

         On June 1, 1999, the Company acquired the remaining  minority  interest
of its joint  venture  Hagler  Bailly Risk  Advisors,  LLC, a limited  liability
company located in Houston,  Texas, from Objective Resources Risk Advisors,  LLC
bringing the Company's ownership to 100%.

         On August 12, 1999, the Company  acquired all of the outstanding  stock
of GKMG, Inc. ("GMKG"), a Washington, D.C.-based consulting firm specializing in
the economic,  strategic,  financial,  and  regulatory  analysis of the aviation
industry,  in exchange for 1,420,000 shares of the Company's common stock. Under
the terms of the Share  Exchange  Agreement by and among the  Company,  GKMG and
former shareholders of GKMG, the Company is obligated to issue additional shares
of its common stock to the former  shareholders of GKMG with a fair market value
(as  defined  in the Share  Exchange  Agreement)  up to $15  million  if certain
earnings targets for GKMG are met for the periods July 1, 1999-June 30, 2000 and
July 1, 2000-June 30, 2001. In addition, the Company is obligated to issue up to
192,857 additional shares of its common stock to the former shareholders of GKMG
if certain stock price  performance  contingencies  are not met. The transaction
was  accounted  for  as a  purchase.  Accordingly,  the  consolidated  financial
statements  reflect  the  results  of  operations  of  GKMG  since  the  date of
acquisition.  The Company has  recorded  intangible  assets  resulting  from the
transaction of approximately $12.4 million, based on information available as of
the date of the financial statements.

The amount of goodwill resulting from the application of purchase  accounting on
1999 acquisitions is tentative based on information  available as of the date of
the financial statements.

Note 4.  Stock Repurchase Plan

         The Company is authorized to repurchase up to 1.5 million shares of the
Company's   common  stock  in  the  open  market  or  in  privately   negotiated
transactions.  As of September  30, 1999,  the Company had  repurchased  559,700
shares.


<PAGE>



Note 5.  Components of Comprehensive Income

         Comprehensive  income includes the Company's net earnings  adjusted for
changes, net of tax, of cumulative translation adjustments. Comprehensive income
for each of the three and nine months  ended  September  30, 1999 and 1998 is as
follows (in thousands):
<TABLE>
<CAPTION>

                                           For the three months ended                For the nine months ended
                                                 September 30,                             September 30,
                                            1999                 1998                1999                 1998
                                            ----                 ----                ----                 ----
<S>                                     <C>                 <C>                  <C>                 <C>
Comprehensive Income:
    Net income                            $ 1,356            $ 2,506              $ 4,048             $ 6,336

Foreign translation adjustment
                                                5                  19              (66)                  (129)

                                      -----------------     ---------------     ----------------    -----------------
Total comprehensive income
                                          $ 1,361            $ 2,525              $ 3,982             $ 6,207
                                      =================     ===============     ================    =================
                                      =================     ===============     ================    =================


</TABLE>

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

Overview

         Statements   included  in  Management's   Discussion  and  Analysis  of
Financial  Condition  and Results of  Operations,  which are not  historical  in
nature,  are  intended to be, and are hereby  identified  as,  "forward  looking
statements"  for  purposes  of the safe  harbor  provided  by Section 21E of the
Securities   Exchange   Act  of  1934,   as  amended   by  Public  Law   104-67.
Forward-looking  statements may be identified by words  including  "anticipate,"
"believe,"  "estimate," "expect" and similar  expressions.  The Company cautions
readers that  forward-looking  statements,  including without limitation,  those
relating to the Company's future business prospects,  revenues, working capital,
liquidity, and income, are subject to certain risks and uncertainties that would
cause  actual  results  to  differ   materially  from  those  indicated  in  the
forward-looking   statements,   due  to  several   important   factors  such  as
concentration  of the  Company's  revenues from a relatively  limited  number of
public and private clients  involved in the energy and network  industries,  the
Company's ability to attract,  retain and manage professional and administrative
staff, fluctuations in quarterly results, risks related to acquisitions, and the
fact that historical  operations and performance are not necessarily  indicative
of future operations and performance,  among others, and other risks and factors
identified  from  time to time in the  Company's  reports  filed  with  the SEC,
including the risk factors  identified in the Company's  Registration  Statement
(No. 333-22207) on Form S-1 and the Company's Annual Report on Form 10-K for the
year ended December 31, 1998, which are incorporated by reference herein.

     The Company,  together with its wholly owned subsidiaries PHB Hagler Bailly
Inc.,  Hagler Bailly  Services,  Inc., and its domestic and foreign wholly owned
subsidiaries,  is a  leading  worldwide  provider  of  strategy,  economics  and
operations  consulting  services  to energy and  network  industries,  including
electric  power,   natural  gas  and  water  utilities,   fuel  providers,
commercial litigation, the environment,   aviation   transportation  and
telecommunications.  As of September 30, 1999, Hagler Bailly employed a staff of
881, of which over two-thirds were consulting and technical professionals. The
Company'scommon stock is quoted on the NASDAQ National Market under the symbol,
"HBIX".

         The  Company's  revenues  consist  of  consulting  revenues  and  other
revenues.  Consulting  revenues represent revenues  associated with professional
staff,  subcontractors  and  independent  consultants,  and client  reimbursable
expenses.  These  revenues are derived from the  Company's  primary  business of
offering  strategy and business operations  consulting services to public
and commercial  rate sector clients.  Other revenues  include those derived from
information-based   products  and  services,  and  publication  of  newsletters,
reference manuals and data series for the energy and transportation  industries.
The  Company's  client  base  includes  both public and  commercial  rate sector
clients.  Revenue from the commercial rate sector is typically  characterized by
higher gross margins than the public  sector,  yet  generally  requires a higher
relative level of infrastructure support.  Consequently, the Company's operating
performance is affected by its public sector / commercial  rate sector  business
mix.  Through  strategic  acquisitions  and  internal  growth,  the  Company has
increased its  commercial  rate sector client base,  and will continue to pursue
additional growth opportunities in the future.

         On August 12, 1999, the Company  acquired all of the outstanding  stock
of GKMG, Inc. ("GMKG"), a Washington, D.C.-based consulting firm specializing in
the economic,  strategic,  financial,  and  regulatory  analysis of the aviation
industry,  in exchange for 1,420,000 shares of the Company's common stock. Under
the terms of the Share  Exchange  Agreement by and among the  Company,  GKMG and
former shareholders of GKMG, the Company is obligated to issue additional shares
of its common stock to the former  shareholders of GKMG with a fair market value
(as  defined  in the Share  Exchange  Agreement)  up to $15  million  if certain
earnings targets for GKMG are met for the periods July 1, 1999-June 30, 2000 and
July 1, 2000-June 30, 2001. In addition, the Company is obligated to issue up to
192,857 additional shares of its common stock to the former shareholders of GKMG
if certain stock price  performance  contingencies  are not met. The transaction
was  accounted  for  as a  purchase.  Accordingly,  the  consolidated  financial
statements  reflect  the  results  of  operations  of  GKMG  since  the  date of
acquisition.  The Company has  recorded  intangible  assets  resulting  from the
transaction of approximately $12.4 million, based on information available as of
the date of the financial statements.

         On  September  27,  1999,  the  Company  announced  that  its  Board of
Directors  retained  Banc of America  Securities  LLC to assist  the  Company in
exploring  strategic and financial  alternatives to maximize  shareholder value,
including the potential sale or merger of the Company.



<PAGE>


Results of Operations

         The following  table presents for the periods  indicated the percentage
of revenues  represented by certain income and expense items, and the percentage
period-to-period increase (decrease) in such items:
<TABLE>
<CAPTION>

                                                                                            % Period-to-Period
                                               Percentage of Revenues                 Increase (Decrease) of Dollars
                                       ----------------------------------------     -----------------------------------
                                                                                     Three months        Nine months
                                                                                        ended          ended September
                                                                                      September           30, 1999
                                                                                       30, 1999          compared to
                                                                                     compared to         nine months
                                                                                     three months      ended September
                                                                                        ended             30, 1998
                                                                                      September
                                                                                       30, 1998
                                         Three months         Nine months ended
                                      ended September 30,       September 30,
                                       ------------------     -----------------     ---------------    ----------------
                                         1999     1998         1999     1998
                                         ----     ----         ----     ----
<S>                                    <C>       <C>         <C>     <C>             <C>                  <C>
Revenues:
  Consulting                              99.3     95.1         99.1     96.4               8.2                3.5
  Other                                    0.7      4.9          0.9      3.6            (86.3)              (75.2)
    Total revenues                       100.0    100.0        100.0    100.0               3.5                 0.6
Cost of services                          76.0     71.3         75.9     71.8              10.4                 6.4
Merger related and other
  non-recurring costs                        -      5.4            -      3.2           (100.0)              (100.0)

Selling, general, and administrative
  expenses                                18.9     14.9         18.7     13.9
                                                                                           31.7                35.8
Stock and stock option compensation
                                             -        -            -      2.0                 -             (100.0)
Income from operations                     5.1      8.5          5.4      9.2            (37.9)              (41.1)
  Other income (expenses), net           (0.3)      0.6          0.0      0.1           (147.3)             (117.2)
Income before income tax expense and
  loss from equity investment in
  joint venture                            4.8      9.1          5.4      9.3            (44.6)              (42.2)
Income tax expense                         2.0      3.7          2.2      4.5            (42.7)              (52.5)
Income before loss from equity
  investment in joint venture              2.8      5.4          3.2      4.8
                                                                                         (45.8)              (32.5)
Loss from joint venture                    0.0        -        (0.2)        -
Net income                                 2.8      5.4          3.0      4.8            (45.8)              (36.1)

</TABLE>

Three months ended September 30, 1999 compared with three months ended September
30, 1998

     Revenues  for the three  months  ended  September  30,  1999,  increased by
approximately  $1.6  million,  or 3.5%,  to $48.1  million from the three months
ended September 30, 1998. The increase  resulted  primarily from $4.5 million of
revenues  from  companies  acquired  since the third  quarter of 1998 as well as
approximately  $1.0 million of increased volume of pass through  equipment sales
to the United  States  Agency for  International  Development  ("USAID")  in the
Company's public sector market. This increase was partially offset by a decrease
in revenues of  approximately  $2.0 million  related to both the sale of certain
assets of the Company's public sector  consulting  practice in September,  1998,
and the  Company's  decision  to  cease  operations  in its  financial  advisory
services  business in December,  1998, a decrease of approximately  $0.8 million
because of reduced staff and a decrease of approximately $1.1 million because of
contract expiration and reduction.


         Cost of  services  for the  three  months  ended  September  30,  1999,
increased  by  approximately  $3.4 million or 10.4%,  to $36.6  million from the
three  months ended  September  30,  1998.  Cost of services as a percentage  of
revenue  increased from 71.3% in the three months ending  September 30, 1998, to
76.0% in the three months ending September 30, 1999,  primarily as the result of
an increase  in cash  compensation  paid to  consulting  staff,  as well as high
pass-through  costs  associated  with the increase in volume of USAID  equipment
sales, on which minimal margins are earned.

         Selling,  general and  administrative  expenses  ("SG&A") for the three
months ended  September  30, 1999,  increased by  approximately  $2.2 million or
31.7%, to $9.1 million from the three months ended September 30, 1998. Expressed
as a percentage of total  revenues,  SG&A expenses  increased  from 14.9% in the
three  months  ended  September  30,  1998 to 18.9% in the  three  months  ended
September 30, 1999. This increase reflects increased business  development costs
and integration costs related to the centralization of certain operating systems
and administrative functions.

         There were no material merger related and other non-recurring costs for
the three months ended  September  30, 1999,  compared with  approximately  $2.5
million in the three months  ended  September  30,  1998.  The majority of these
costs in the  comparable  period were  associated  with the  Company's  business
combination  with Putnam Hayes & Bartlett,  Inc.  ("PHB").  The  remainder  were
expenses  associated with the Company's  business  combinations with TB&A Group,
Inc. and its wholly-owned  subsidiary Theodore Barry & Associates  (collectively
"TB&A"), and Izsak, Grapin et Associes ("IGA").

         Other  income  (expenses),  net  includes  interest  expense,  interest
income,  minority  interest and other income and expenses.  For the three months
ended September 30, 1999, net expenses were approximately $122,000,  compared to
net other income of  approximately  $258,000 in the three months ended September
30,  1998.  The net other  income in 1998 was  primarily  related to the sale of
certain assets of the Company's public sector consulting practice.

         The Company's effective tax rate increased to 42.0% in the three months
ended  September  30, 1999 from 40.6% in the three  months ended  September  30,
1998. The higher  effective  income tax rate in the three months ended September
30, 1999, results from the associated  goodwill  amortization of recent business
combinations that will be non-deductible for income tax reporting purposes.

     Net income for the three months  ended  September  30,  1999,  decreased by
approximately  $1.2  million,  or 45.8%,  to $1.4  million from the three months
ended September 30, 1998, for reasons discussed above.


<PAGE>



Nine months ended  September 30, 1999 compared with nine months ended  September
30, 1998

         Revenues for the nine months  ended  September  30, 1999,  increased by
approximately $0.8 million or 0.6%, to $132.9 million from the nine months ended
September 30, 1998.  The increase  resulted  primarily from  approximately  $9.1
million of revenues  from  companies  acquired  since the third quarter of 1998.
This  increase was partially  offset by a decrease in revenues of  approximately
$7.4 million related to both the sale of certain assets of the Company's  public
sector  consulting  practice in September,  1998, and the Company's  decision to
cease operations in its financial advisory services business in December,  1998,
and an aggregate decrease of approximately $0.9 million company wide.

         Cost  of  services  for the  nine  months  ended  September  30,  1999,
increased by $6.1 million, or 6.4%, to $100.9 million from the nine months ended
September 30, 1998.  Cost of services as a percentage of revenue  increased from
71.8% in the nine months ending  September 30, 1998, to 75.9% in the nine months
ending September 30, 1999. The increase  resulted  primarily from increased
staffing costs.

         SG&A for the  nine  months  ended  September  30,  1999,  increased  by
approximately  $6.5  million,  or 35.8%,  to $24.8  million from the nine months
ended  September  30, 1998.  Expressed as a percentage of total  revenues,  SG&A
expenses  increased  from 13.9% in the nine months ended  September 30, 1998, to
18.7% in the nine months  ended  September  30,  1999.  This  increase  reflects
increased  business  development  costs and  integration  costs  related  to the
centralization of certain operating systems and administrative functions.

         There were no material merger related and other non-recurring costs for
the nine months ended  September  30, 1999,  compared  with  approximately  $4.2
million in the nine months ended September 30, 1998. The majority of these costs
in the comparable period were associated with the Company's business combination
with PHB as well as the Company's business combinations with TB&A and IGA.

         There were no stock and stock option compensation expenses for the nine
months ended September 30, 1999, compared with approximately $2.6 million in the
nine months ended  September  30,  1998.  All of these costs in the prior period
were related to the business combination with PHB and included non-cash, non-tax
deductible  compensation  based on the difference  between the fair market value
and book values of PHB common stock issuable under subscriptions within one year
of the acquisition of PHB by the Company.

         Other  income  (expenses),  net  includes  interest  expense,  interest
income,  minority  interest and other income and  expenses.  For the nine months
ended September 30, 1999, net expenses were approximately  $31,000,  compared to
net other income of  approximately  $179,000 in the nine months ended  September
30,  1998.  The net other  income in 1998 was  primarily  related to the sale of
certain assets of the Company's public sector consulting practice.

         The Company's  effective tax rate decreased to 40.0% in the nine months
ended September 30, 1999 from 48.7% in the nine months ended September 30, 1998.
The effective tax rate for the comparable period was higher than the provisional
rate because of the non-deductibility for tax purposes of the stock compensation
charge discussed above.

     Net income for the nine months  ended  September  30,  1999,  decreased  by
approximately $2.3 million, or 36.1%, to $4.0 million from the nine months ended
September 30, for the reasons discussed above.

Liquidity and Capital Resources

         As of September 30, 1999,  working  capital  decreased to $51.3 million
from $54.3  million at  December  31,  1998  because of an  increase  in accrued
compensation.

         Net cash of  approximately  $5.5  million  was  provided  by  operating
activities  during the nine months ended September 30, 1999. The primary sources
of cash provided by operating  activities were net income of approximately  $4.0
million,  non-cash depreciation of approximately $4.4 million and an increase in
accrued  compensation  and benefits of  approximately  $3.2 million.  These cash
flows were  partially  offset by an  increase  in  accounts  receivable  of $6.4
million.

         Investment  activities used  approximately $4.2 million during the nine
months ended September 30, 1999. The Company invested approximately $3.3 million
in  the  purchase  of  office  and   computer   related   equipment,   leasehold
improvements, and other resources necessary to improve operating efficiencies of
the Company,  as well as approximately $0.8 million for the purchase of acquired
companies.

         Financing  activities  used  approximately  $4.0  million  for the nine
months ended September 30, 1999. The Company used  approximately $4.1 million in
funds for the repurchase of 559,700 shares of the Company's common stock.  Under
the stock  buyback  program  established  by the Board of the  Directors,  as of
September 30, 1999, the Company is authorized to repurchase  940,300  additional
shares of the Company's common stock.

         The  Company's  primary  source of liquidity for the past 12 months has
been funds  generated from  operations  periodically  supplemented by borrowings
under a bank line of credit.  During  the year  ended  December  31,  1998,  the
Company  established  $50.0  million in  revolving  credit  with Bank of America
(formerly  NationsBank.)  The  amount  available  under  the line of  credit  at
September  30,  1999 was  $50.0  million.  The  Company  believes  that  current
projected  levels of cash flows and the  availability  of  financing,  including
borrowings  under the Company's  credit  facility,  will be adequate to fund its
anticipated cash needs,  which may include future  acquisitions of complementary
businesses,  for at least the next 12 months.  The Company,  depending on market
conditions, may consider other sources of financing, including equity financing.


<PAGE>




Year 2000

         The Year 2000 issue is the result of a computer  hardware  and software
design  that  defines  the year  field as two  digits  instead  of four  digits.
Computer  programs  and  systems  with this  problem  will be unable to properly
distinguish  between the year 2000 and the year 1900. As a result,  the programs
could fail or yield incorrect results. The Company's business,  as well of those
of its  principal  suppliers  and  clients,  is  dependent on the ability of its
software and hardware  systems to properly  function.  Failure of one or more of
these  systems of the Company or a material  client or a supplier  could disrupt
the  Company's  operations  and  could  have a  material  adverse  effect on the
Company's business, results of operations and financial condition.

         The Company's Year 2000 Strategy

     The Company has  established  the Year 2000  Readiness Plan (the "Plan") to
prepare  for the Year  2000  issue.  This  Plan is  comprised  of the  following
elements:

         Audit, assessment, remediation, and testing of internal systems.

         Obtaining  assurance or information on the state of Year 2000 readiness
     of  our  material   clients  and   suppliers   who   exchange   information
     electronically with us or upon whom our work product may depend.

         Developing contingency plans, when practical, to address potential Year
2000 failures.

The Plan was materially complete as of October 31, 1999.


         Year 2000 Readiness Report

         The  Company  completed  several  acquisitions  in 1998  and  1999.  It
undertook a comprehensive due diligence examination that identified general Year
2000  Readiness  issues for itself and the  companies it  acquired.  The Company
formalized  its  efforts by  establishing  a Year 2000  Working  Committee  (the
"Committee") led by its Chief Information  Officer to oversee the integration of
its Year 2000 efforts and to implement the Plan. The Committee includes the CEO,
CFO, General Counsel,  and other executives and outside consultants as required.
The Company  engaged  consultants  to complete  the  assessment  of its domestic
offices and to assist in the assessment of its major international offices.

         The Company's  front office  systems (used for the delivery of services
to clients), both hardware and software, were replaced or significantly upgraded
in 1997 and 1998  and were  manufactured  to be Year  2000  ready  (with  minor,
vendor-identified  problems).  Due to the  mid-1999  release  of new  Year  2000
"software" fixes from Microsoft,  the principal  supplier of the Company's front
office  software,   the Company  currently  expects that the process of updating
those  systems that are not Year 2000 ready will be performed in the 4th quarter
1999.

         With some exceptions,  the Company does not employ  significant  custom
programming  in its front office,  work  product,  or back office  systems.  The
Company's  work  product  is  generated  for the  most  part  with  commercially
available statistical,  econometric, word processing,  spreadsheet, database, or
mathematical  software  for which the Company has obtained  Year 2000  Readiness
assurances.  These software  products have been audited and have been or will be
updated where appropriate. Where the Company has supplemented these commercially
available software products with custom programming, teams are being established
to  assess  the  software.  These  situations  do not  represent  a  significant
percentage of the Company's work product. The Company is implementing a software
application  to aid the  monitoring of Year 2000  compliance of new work product
and to provide a testing  mechanism for the re-use of models,  spreadsheets,  or
databases.  This  application  is a  commercially  available Year 2000 audit and
remediation  product  specifically  designed  for  Microsoft  Windows  compliant
software applications.

         A  conversion  was  undertaken  in 1998 to  replace a  significant  and
non-compliant analytic system (used to service client analysis needs), including
hardware and software,  with a compliant system.  The implementation is complete
with all new analytic engagements  developed on compliant hardware and software.
The  conversion of remaining  active  analytic  applications  was  substantially
complete as of October 31, 1999.

     Back office systems including  financial  accounting,  project  accounting,
fixed asset management,  human resources,  payroll, and conflict management have
been  replaced.  These were  updated  with  vendor  supplied  Year 2000 fixes or
converted to compliant  versions of the software.  The Company has tested  its
back office  systems and expects these systems to present no material  problems.
Certain models of personal  computers have been identified as non-compliant  and
will be replaced in 1999. The number of Year 2000  replacements  will not exceed
the normal annual personal computer turnover.

     The Company  contacted  the  vendors of its  principal  office  systems and
obtained proof of Year 2000 readiness or identified  compliance issues which the
Company  has  addressed.  The  Company's  material  office  systems  include its
telephone,  communications  and  networking  equipment,  security and facilities
systems, copiers, pagers, voicemail, and faxing systems.

     Because  the  Company  is  highly   decentralized   with  21  domestic  and
international  offices,  the remediation of international office systems was not
complete as of October 31, 1999.  Remediation is underway in the case of mission
critical  systems  judged  non-compliant,  specifically,  a network  upgrade  in
Indonesia.  The  assessment of the  international  offices  revealed the need to
perform version  upgrades and software  patches similar to those being performed
as a result of the domestic audit.  Remediation efforts for basic IT systems are
underway and substantially  complete in most international  offices. Some office
systems in the Company's  international offices may not be corrected by December
31, 1999, but the Company does not expect such systems to materially  affect the
Company's ability to complete its engagements.




Clients

     The Company's clients include domestic and international companies, private
law firms,  and  federal,  state,  local and foreign  government  entities.  The
Company has responded to Year 2000 compliance  surveys from over 50 of its major
clients  and  shared its  readiness  information.  In April  1999,  the  Company
initiated  a survey of a cross  section  of its  largest  clients  (measured  by
revenue  generated  for the  Company  in  1998) to  determine  their  Year  2000
readiness.  The Company plans to survey other clients if  circumstances  warrant
and, where practical,  to survey new clients upon new engagements.  To date, the
Company has not received  responses from all the clients surveyed.  Based on the
responses  received,  the Company  does not believe  that any client  failure to
comply  with Year 2000  compliance  requirements  will have a  material  adverse
effect on it.

Material Vendors

     The Company  performs  analytic  work on time  sensitive  matters.  Certain
vendors have been identified as critical to implementing the Plan. These vendors
include payroll,  credit,  transportation,  information  resources,  and certain
other maintenance  vendors of mission critical hardware and software.  If one or
more of these vendors experiences significant business disruption as a result of
the Year 2000 issue,  it could have a material  adverse  effect on the Company's
business,  results of operations and financial  condition.  For example,  if the
Company's principal suppliers of real-time  electricity data are not functioning
properly,  the  Company  may be unable to  perform  analytic  work for  clients.
Similarly, if hardware used to perform modeling cannot be supported because of a
Year 2000 issue at the vendor,  the Company's ability to meet client demands for
time sensitive analysis might be jeopardized. The Committee continues to monitor
the Company's  principal  vendors and may need to develop  contingency  plans to
replace those vendors whose ability to certify Year 2000  readiness is in doubt.
The Committee  expects that the process of  evaluating  and working with outside
vendors will continue through the fourth quarter of 1999.

Contingency Planning

     The Committee has developed a contingency plan in the event that a material
system or vendor will not be Year 2000 ready by December 31, 1999.




Costs

     The Company  budgeted  $300,000 in fiscal  years 1999 and 2000 to cover the
costs of: (i) evaluating systems, (ii) acquiring Year 2000 remediation software,
(iii) additional  testing of hardware and software,  (iv) hiring an outside Year
2000  consultant,  and (iv)  implementing  of the  Plan.  Although  the  Company
believes this amount will be sufficient to meet the costs of the Company's  Year
2000  readiness  efforts,  there can be no  assurance  that these costs will not
significantly exceed the Company's current estimates.  To date, expenditures for
Year  2000  readiness   have  been  nominal  and   associated   with  the  rapid
implementation of already planned front office and back office systems upgrades.

Risks

The Company  perceives  that its greatest Year 2000 risk is its dependence on an
external network of information providers,  vendors, and experts to complete its
engagements.  Even if the  Company  can  satisfy  itself that the systems of its
material  suppliers  and  partners  are Year 2000  ready,  those  suppliers  and
partners  in turn rely on other  suppliers  to operate  their  businesses.  Year
2000-related  failures  far removed  from the Company  could  trigger a chain of
events that could  materially  affect the Company's  business.  Certain clients,
despite  their best  efforts,  may suffer the  effects of Year 2000  failures of
others and thus delay, cancel, or substantially alter work in progress resulting
in a negative effect on the operations of the Company,  including the failure to
meet financial expectations or the loss of key personnel. Such a chain of events
could also lead to  litigation  against the Company.  The Company also  performs
work in  regions  deemed at high risk for Year 2000  disruptions,  specifically,
Latin America,  Eastern Europe, and Asia. Lastly, the Company perceives that the
stability of technical and critical office staff is important to the Plan and is
considering   steps  to  decrease  the  risk  of  losing   critical   resources.
Notwithstanding these efforts, there can be no assurance that Year 2000 problems
will not have a material  adverse effect on the Company's  business,  results of
operations, or financial condition.


<PAGE>


                                     PART II

Item 1.  Legal Proceedings

         Apogee  Research,  Inc.  ("Apogee"),  a wholly owned  subsidiary of the
Company,  received  a  subpoena  in July 1998 from the  Office of the  Inspector
General of the Environmental  Protection  Agency (the "EPA") requesting  records
for the period from April 1993  through  October 1995  pertaining  to a contract
between  Apogee and the EPA.  Apogee has  provided  records in  response  to the
subpoena.  The work under this  contract  has been  completed.  The subpoena was
served in connection  with an EPA  investigation  relating to the  submission of
potential false statements and false claims under the contract. Hagler Bailly is
unable to  determine at this time what effect,  if any, the  investigation  will
have on its business, financial condition or results of operations.

         Express One International,  Inc. ("Express One") sued Galland, Kharash,
Morse & Garfinkle, P.C., a predecessor of the Company's wholly owned subsidiary,
GKMG, Inc. ("GKMG"),  and two of its shareholders,  Robert W. Kneisley and David
K. Monroe, in a Texas state court in 1994 alleging (i) business disparagement or
injurious falsehood;  (ii) business defamation;  and (iii) tortious interference
with  prospective  contracts or business  relationships  and claiming  over $200
million in actual  damages and  punitive  (exemplary)  damages of at least three
times actual damages.  The case was removed to the United District Court for the
Northern District of Texas,  Dallas Division,  where it is currently pending. On
October 1, 1999 the court  granted  GKMG's  motion for  summary  judgment  as to
dismissal of claims of business  disparagement  and  business  libel per se. The
Company is unable to determine what effect, if any, this litigation will have on
its business, financial condition or results of operations.

         The  Company  and its  subsidiaries  are from time to time  parties  to
litigation  arising in the  ordinary  course of  business.  Except as  described
above, neither the Company nor any of its subsidiaries is a party to any pending
material  litigation  nor are any of them  aware of any  pending  or  threatened
litigation  that  would  have a material  adverse  effect on the  Company or its
business, financial condition or results of operations.

Item 2.  Changes in Securities

         On August 12, 1999, the Company acquired all of the outstanding  shares
of GKMG, an aviation  consulting  company,  and issued  1,420,000  shares of its
common stock to GKMG's former  shareholders in exchange therefor.  The shares of
common  stock  issued  in  connection  with the  acquisition  were  exempt  form
registration  pursuant  to  Section  4(2)  of the  Securities  Act of  1933  and
Regulation D promulgated thereunder.


<PAGE>


Item 6. Exhibits and reports on form 8-K

(a)      Exhibits

Exhibit No.                                                   Description

     2.1  Sale  Agreement  between RCG  International,  Inc.,  and Hagler Bailly
          Consulting, Inc. (1)

     2.2  Agreement  and Plan of Merger by and among Hagler  Bailly,  Inc.,  PHB
          Acquisition  Corp. and Putnam,  Hayes and Bartlett,  Inc., dated as of
          June 11, 1998. (5)

     2.3  Share  Exchange  Agreement  dated as of August  12,  1999 by and among
          Hagler Bailly,  Inc.,  GKMG,  Inc. and certain former  shareholders of
          GKMG, Inc. (11)

     3.1  By-Laws of the Company, as amended. (6)

     3.2  Amended Restated Certificate of Incorporation of the Company. (7)

     4    Specimen Stock Certificates. (1)

     4.1  Registration  Rights  Agreement dated November 18, 1997 by and between
          Hagler  Bailly,  Inc.  and Richard R. Mudge,  acting as  Stockholders'
          Representative. (3)

     4.2  Form of Escrow  Agreement  by and among the Company,  PHB  Acquisition
          Corp., William E. Dickenson as Stockholders'  Representative and State
          Street Bank and Trust Company, as Escrow Agent. (5)

     4.3  Registration  Rights  Agreement dated February 23, 1998 by and between
          Hagler  Bailly,  Inc.  and  Michael J. Beck,  acting as  Stockholders'
          Representative.(9)

     4.4  Registration  Rights  Agreement dated November 17, 1998 by and between
          Hagler Bailly,  Inc. and the  stockholders of Fieldston  Publications,
          Inc. and The Fieldston Company. (9)

     4.5  Registration  Rights  Agreement  dated as of  August  12,  1999 by and
          between   Hagler  Bailly,   Inc.  and  James  F.  Miller,   acting  as
          Stockholders' Representative. (11)

     10.2 Form of Non-Compete, Confidentiality and Registration Rights Agreement
          between the Company and each stockholder. (1)

     10.3 Lease by and between Wilson Boulevard  Venture and RCG/Hagler  Bailly,
          Inc. dated October 25, 1991. (1)


     10.4 First Amendment to Lease by and between Wilson  Boulevard  Venture and
          RCG/Hagler Bailly, Inc., dated February 26, 1993. (1)

     10.5 Second Amendment to Lease by and between Wilson Boulevard  Venture and
          RCG/Hagler Bailly, Inc., dated December 12, 1994. (1)

     10.6 Lease  by  and  between   Bresta  Futura  V.B.V.   and  Hagler  Bailly
          Consulting, Inc. dated May 8, 1996. (1)

     10.7 Lease by and between L.C.  Fulenwider,  Inc., and  RCG/Hagler  Bailly,
          Inc. dated December 14, 1994. (1)

     10.8 Lease by and between  University of Research Park Facilities Corp. and
          RCG/Hagler Bailly, Inc., dated April 1, 1995. (1)

     10.9 Credit  Agreement by and between  Hagler Bailly  Consulting,  Inc. and
          State Street Bank and Trust Company, dated May 17, 1995. (1)

     10.10Amendment   to  Credit   Agreement  by  and  between   Hagler   Bailly
          Consulting,  Inc. and State Street Bank and Trust Company, dated as of
          June 20,1996. (1)

     10.11Extension Agreement by and between Hagler Bailly Consulting,  Inc. and
          State Street Bank and Trust Company, dated as of August 1, 1996. (1)

     10.12Amendment   to  Credit   Agreement  by  and  between   Hagler   Bailly
          Consulting,  Inc. and State Street Bank and Trust Company, dated as of
          November 12, 1996. (1)

     10.13Term Note by and between  Hagler Bailly  Consulting,  Inc.,  and State
          Street Bank and Trust Company, dated May 26, 1995. (1)

     10.14Revolving  Credit Note by and between Hagler Bailly  Consulting,  Inc.
          and State Street Bank and Trust Company dated May 26, 1995. (1)

     10.15Amendment   to  Credit   Agreement  by  and  between   Hagler   Bailly
          Consulting, Inc., and State Street Bank and Trust Company, dated as of
          June 12,1997. (1)

     10.16Credit Agreement by and among Hagler Bailly  Consulting,  Inc., Hagler
          Bailly Services,  Inc. and State Street Bank and Trust Company,  dated
          as of September 30, 1997. (2)

     10.17Promissory  Note by Hagler Bailly  Consulting,  Inc. and Hagler Bailly
          Services, Inc. to State Street Bank and Trust
                  Company, dated September 30, 1997. (2)

     10.18Security Agreement by and between Hagler Bailly  Consulting,  Inc. and
          State Street Bank and Trust  Company,  dated as of September 30, 1997.
          (2)

     10.19Security  Agreement by and between  Hagler Bailly  Services,  Inc. and
          State Street Bank and Trust  Company,  dated as of September 30, 1997.
          (2)

     10.20Guaranties  by Hagler  Bailly,  Inc.  to State  Street  Bank and Trust
          Company, dated September 30, 1997. (2)

     10.21Guaranties  by HB  Capital,  Inc.  to  State  Street  Bank  and  Trust
          Company, dated September 30, 1997. (2)

     10.22Subordination  Agreement  and  Negative  Pledge/Sale  Agreement by and
          between  Hagler  Bailly,  Inc. and State Street Bank and Trust Company
          for Hagler Bailly Consulting, Inc., dated September 30, 1997. (2)

     10.23Subordination  Agreement  and  Negative  Pledge/Sale  Agreement by and
          between  Hagler  Bailly,  Inc. and State Street Bank and Trust Company
          for Hagler Bailly Services, Inc., dated September 30, 1997. (2)

     10.24Guaranty of Monetary  Obligations  to Bresta Futura  V.B.V.  by Hagler
          Bailly, Inc., dated July 23, 1997. (2)

     10.25Amendment   to  Credit   Agreement  by  and  between   Hagler   Bailly
          Consulting, Inc. and State Street Bank and Trust Company dated May 18,
          1998. (6)

     10.26Sublease  Agreement  by and between  Coopers and  Lybrand  L.L.P.  and
          Hagler Bailly, Inc. dated December 5, 1997. (6)

     10.27Employment  Agreement  between the Company and Henri-Claude A. Bailly,
          dated August 27, 1998. (7)

     10.28Employment  Agreement  between the  Company and William E.  Dickenson,
          dated August 27, 1998. (7)

     10.29Employment  Agreement  between  the  Company  and Howard W. Pifer III,
          dated June 10, 1998. (7)

     10.30Amended and  Restated  Hagler  Bailly,  Inc.  Employee  Incentive  and
          Non-Qualified Stock Option and Restricted Stock Plan. (10)

     10.31Credit  Agreement by and between Hagler  Bailly,  Inc. and The Lenders
          From Time to Time a Party thereto, as Lenders and
                  NationsBank, N.A., dated November 20, 1998. (8)

     10.32Revolving  Note by and between Hagler  Bailly,  Inc. and  NationsBank,
          N.A., dated November 20, 1998. (8)

     10.33Swing Line Note by and between  Hagler Bailly,  Inc. and  NationsBank,
          N.A., dated November 20, 1998. (8)

     10.34  Subsidiary  Guarantee by and
          among Hagler Bailly Services, Inc., Hagler Bailly Consulting, Inc., HB
          Capital,  Inc.,  Putnam,  Hayes & Bartlett,  Inc.,  TB&A Group,  Inc.,
          Theodore  Barry &  Associates,  Private Label Energy  Services,  Inc.,
          Fieldston Publications, Inc. and NationsBank, N.A., dated November 20,
          1998. (8)

     10.35Form of Security  Agreement  by and between  Hagler  Bailly,  Inc. and
          NationsBank, N.A., dated November 20, 1998. (8)

     10.36Security Agreement by and between Hagler Bailly  Consulting,  Inc. and
          NationsBank, N.A., dated November 20, 1998. (8)

     10.37Security  Agreement by and between  Hagler Bailly  Services,  Inc. and
          NationsBank, N.A., dated November 20, 1998. (8)

     10.38Security  Agreement by and between HB Capital,  Inc. and Nations Bank,
          N.A., dated November 20, 1998. (8)

     10.39Security Agreement by and between Putnam,  Hayes & Bartlett,  Inc. and
          NationsBank, N.A., dated November 20, 1998. (8)

     10.40Security  Agreement by and between TB&A Group,  Inc. and Nations Bank,
          N.A., dated November 20, 1998. (8)

     10.41Security  Agreement by and between  Theodore  Barry &  Associates  and
          NationsBank, N.A., dated November 20, 1998. (8)

     10.42Security  Agreement  by  and  between  PHB  Hagler  Bailly,  Inc.  and
          NationsBank, N.A., dated February 22, 1999. (8)

     10.43Security Agreement by and between Private Label Energy Services,  Inc.
          and NationsBank, N.A., dated November 20, 1998. (8)

     10.44Security  Agreement by and between  Fieldston  Publications,  Inc. and
          NationsBank, N.A., dated November 20, 1998. (8)

     10.45Lease by and  between  One  Memorial  Drive  Limited  Partnership  and
          Putnam, Hayes & Bartlett, Inc. dated January 1, 1998. (8)

     10.46Lease by and  between  George H.  Beuchert,  Jr.,  Trustee,  Thomas J.
          Egan, Trustee, Oliver T. Carr, Jr., Trustee,  William Joseph H. Smith,
          Trustee, and the Kiplinger Washington Editors,  Inc., Trustee,  acting
          collectively  as  trustee  on  behalf  of the  beneficial  owner,  The
          Greystone Square 127 Associates,  and Putnam,  Hayes & Bartlett,  Inc.
          dated March 31, 1997. (8)

     10.47First Amendment to Lease by and between  Greystone  Square 127 Limited
          Liability  Company,  as  successor  in  interest  collectively  to The
          Greystone Square 127 Associates, and George H. Beuchert, Jr., Trustee,
          and The Kiplinger  Washington Editors,  Inc.,  Trustee,  the owners of
          record who held legal  title to the  Building as trustees on behalf of
          the Greystone Square 127 Associates,  the former  beneficial owners of
          the Building,  and Putnam,  Hayes & Bartlett,  Inc. dated February 10,
          1998. (8)

     10.48Employment  agreement  between  Hagler  Bailly  Consulting,  Inc.  and
          Jasjeet S. Cheema dated February 2, 1998. (9)

     10.49First amendment to revolving credit  agreement  between Hagler Bailly,
          Inc, the lenders from time to time a party  thereto,  as lenders,  and
          NationsBank, N.A., dated as of March 22, 1999. (9)

     10.50Lease by and between  TrizecHahn,  1550 Wilson  Blvd.  Management  and
          Hagler Bailly Services, Inc. dated August 29, 1999.

     10.51Second amendment to revolving credit agreement  between Hagler Bailly,
          Inc., the lenders from time to time a party thereto,  as lenders,  and
          NationsBank, N.A., dated as of August 11, 1999.

     10.52Security  Agreement by and between GKMG, Inc. and  NationsBank,  N.A.,
          dated August 11, 1999.

     10.53Security Agreement by and between GKMG Consulting  Services,  Inc. and
          NationsBank, N.A., dated August 11, 1999.

     24   Powers of Attorney (included on Signature Pages) (1)

     27.1 Finacial Data Schedule - September 30, 1999




               -----------------------------------------------------------------
               (1) Included in the Company's  Registration Statement on Form S-1
               filed on July 1, 1997 (No.  333-22207) and incorporated herein by
               reference thereto.

          (2)  Included in the Company's  Quarterly  Report on Form 10-Q for the
               quarter ended September 30, 1997,  filed on November 14, 1997 and
               incorporated herein by reference thereto.

          (3)  Included  in the  Company's  Current  Report on Form 8-K filed on
               December 16, 1997 and incorporated herein by reference thereto.

          (4)  Included in the Company's Annual Report on Form 10-K for the year
               ended December 31, 1997, filed on March 31, 1998 and incorporated
               herein by reference thereto.

          (5)  Included in the Company's  Proxy Statement for Special Meeting of
               Stockholders   dated   July  24,   1998  on  Form  DEFS  14A  and
               incorporated herein by reference thereto.

          (6)  Included in the Company's  Quarterly  Report on Form 10-Q for the
               quarter ended June 30, 1998, filed on August 14, 1998
                  and incorporated herein by reference thereto.

          (7)  Included in the Company's  Quarterly  Report on Form 10-Q for the
               quarter ended September 30, 1998,  filed on November 13, 1998 and
               incorporated herein by reference thereto.

          (8)  Included in the Company's Annual Report on Form 10-K for the year
               ended December 31, 1998, filed on March 31, 1998 and incorporated
               herein by reference thereto.

          (9)  Included in the Company's  Quarterly  Report on Form 10-Q for the
               quarter  ended  March  31,  1999,  and  incorporated   herein  by
               reference thereto.

          (10) Included in the Company's  Quarterly  Report on Form 10-Q for the
               quarter ended June 30, 1999, and incorporated herein by reference
               thereto.

          (11) Included  in the  Company's  Current  Report on Form 8-K filed on
               August 26, 1999 and incorporated herein by reference thereto.

(b)      Reports on Form 8-K

      On August 26,  1999,  the  Company  filed a current  report on Form 8-K to
      report its  acquisition  of all of the shares of GKMG,  Inc.,  an aviation
      consulting firm.



<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.



Date: November 15, 1999             /s/ William E. Dickenson
                                     ------------------------
                                    William E. Dickenson
                                    President and Chief Executive Officer

Date: November 15, 1999             /s/ Geoffrey W. Bobsin
                                    ----------------------
                                 Senior Vice President, Chief Financial Officer,
                                 Treasurer and Secretary