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

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

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

                                   Form 10-QSB

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

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

                  For the quarterly period ended June 30, 1999

                                  ZAPWORLD.COM
                 (Name of small business issuer in its charter)

            CALIFORNIA                                  94-3210624
   (State or other jurisdiction of         (I.R.S. Employer Identification No.)
   incorporation or organization)

                                117 Morris Street
                              Sebastopol, CA 95472
                                 (707) 824-4150
    (Address, including zip code, and telephone number, including area code,
                  of registrant's principal executive offices)

         Securities registered under section 12(b) of the Exchange Act:
                                      None


         Securities registered under section 12(g) of the Exchange Act:
                                      None


                    Former Name, If Changed Since Last Report
                                ZAP Power Systems


         Check whether the issuer (1) filed all reports  required to be filed by
Section 13 or 15(d) of the Securities Exchange Act during the past 12 months (or
for such shorter  period that the registrant was required to file such reports),
and (2) has been subject to such filing  requirements  for the past 90 days. Yes
XNo

         State the number of shares  outstanding of each of the issuer's classes
of common equity, as of the latest practicable date.

             4,344,211 shares of common stock as of August 8, 1999.

           Transitional Small Business Disclosure Format Yes[ ] No[x]

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

<PAGE>

Part I.  FINANCIAL INFORMATION

Item 1.  Financial Statements

         ZAPWORLD.COM
         CONDENSED BALANCE SHEET

                                                                       June 30,
                                                                        1999
--------------------------------------------------------------------------------
                                     ASSETS
CURRENT ASSETS
     Cash                                                           $ 3,048,700
     Receivables                                                        458,000
     Inventories                                                      1,176,200
     Prepaid expenses and other assets                                  399,300
                                                                    -----------
         Total current assets                                         5,082,200
                                                                    -----------

PROPERTY AND EQUIPMENT                                                  221,700
                                                                    -----------

OTHER ASSETS
      Intangibles, net of accumulated amortization
          of $12,900                                                    116,900
      Investment in EMB                                                  50,000
      Deposits                                                           14,400
                                                                    -----------
          Total other assets                                            181,300
                                                                    -----------

          Total assets                                              $ 5,485,200
                                                                    ===========

          LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
     Accounts payable                                               $   626,500
     Accrued liabilities and other expenses                             128,700
     Customer Deposits                                                   43,500
     Notes payable                                                        4,000
     Current maturities of long-term debt                                 6,200
     Current maturities of obligations under capital leases               6,500
                                                                    -----------
          Total current liabilities                                     815,400
                                                                    -----------

OTHER LIABILITIES
     Obligations under capital leases, less current maturities           12,700
     Long-Term Debt, less current maturities                             24,800
                                                                    -----------
                      Total other liabilities                            37,500
                                                                    -----------
STOCKHOLDERS' EQUITY
     Common stock, no par value; 10,000,000 shares
             authorized, 4,318,191 shares issued and
             outstanding                                              8,046,000
     Accumulated deficit                                             (3,413,700)
                                                                    -----------
          Total stockholders' equity                                  4,632,300
                                                                    -----------

Total liabilities and stockholders' equity                          $ 5,485,200
                                                                    ===========


The accompanying notes are an integral part of these financial statements

                                       2

<PAGE>

<TABLE>
ZAPWORLD.COM
CONDENSED STATEMENTS OF OPERATIONS

<CAPTION>

                                                                Quarter ended June 30,                 Six Months ended June 30,
                                                             1999                 1998                 1999                 1998
------------------------------------------------------------------------------------------------------------------------------------
<S>                                                      <C>                      <C>              <C>                  <C>
NET SALES                                                $ 1,513,100              863,700          $ 2,677,200          $ 1,324,900

COST OF GOODS SOLD                                           843,100              636,800            1,599,200              906,400
                                                         -----------          -----------          -----------          -----------

GROSS PROFIT                                                 670,000              226,900            1,078,000              418,500
                                                         -----------          -----------          -----------          -----------

OPERATING EXPENSES
     Selling                                                 249,100              250,700              449,100              409,700
     General and administrative                              296,100              219,900              514,300              382,400
     Research and development                                 75,600               47,600              123,200               79,900
                                                         -----------          -----------          -----------          -----------
                                                             620,800              518,200            1,086,600              872,000
                                                         -----------          -----------          -----------          -----------

INCOME/(LOSS)
FROM OPERATIONS                                               49,200             (291,300)              (8,600)            (453,500)
                                                         -----------          -----------          -----------          -----------

OTHER INCOME (EXPENSE)
     Interest expense                                         (1,000)              (3,600)             (75,700)              (6,300)
     Other                                                    16,400               (4,100)              17,400                  400
                                                         -----------          -----------          -----------          -----------
                                                              15,400               (7,700)             (58,300)              (5,900)
                                                         -----------          -----------          -----------          -----------

NET INCOME/(LOSS)                                        $    64,600          $  (299,000)         $   (66,900)         $  (459,400)
                                                         ===========          ===========          ===========          ===========

NET INCOME/(LOSS)
PER COMMON SHARE,
BASIC AND DILUTED                                        $      0.02          $     (0.12)         $     (0.02)         $     (0.18)
                                                         ===========          ===========          ===========          ===========


WEIGHTED AVERAGE OF COMMON
      SHARES OUTSTANDING                                   3,754,900            2,592,900            3,294,000            2,571,800
                                                         ===========          ===========          ===========          ===========


<FN>
The accompanying notes are an integral part of these financial statements
</FN>
</TABLE>

                                                                  3
<PAGE>


<TABLE>

ZAPWORLD.COM
CONDENSED STATEMENTS OF CASH FLOWS
<CAPTION>

                                                                                                         Six months ended June 30,
                                                                                                       1999                   1998
------------------------------------------------------------------------------------------------------------------------------------
<S>                                                                                              <C>                    <C>
CASH FLOWS FROM OPERATING ACTIVITIES
     Net loss                                                                                    $   (66,900)           $  (459,400)
     Adjustments to reconcile net loss to net cash
       used by operating activities
         Depreciation and amortization                                                                49,700                 44,600
         Issuance of common stock for services rendered                                              746,200                 64,600
       Changes in:
         Receivables                                                                                (174,200)              (248,800)
         Inventories                                                                                (542,400)              (127,200)
         Prepaid expenses                                                                           (270,600)               (68,700)
         Deposits                                                                                     (2,500)               (92,300)
         Accounts payable                                                                            292,200                231,800
         Accrued liabilities and other expenses                                                      (20,500)               (70,200)
                                                                                                 -----------            -----------
              Net cash provided (used) by operating activities                                        11,000               (725,600)
                                                                                                 -----------            -----------

CASH FLOWS FROM INVESTING ACTIVITIES
     Purchases of equipment                                                                          (89,200)               (96,300)
     Investment in Electric Motorbike Inc.                                                           (50,000)                  --
                                                                                                 -----------            -----------
                         Net cash used by investing activities                                      (139,200)               (96,300)
                                                                                                 -----------            -----------

CASH FLOWS FROM FINANCING ACTIVITIES
     Proceeds from issuance of notes and loans payable                                                14,800                 18,700
     Sale of common stock, net of stock offering costs                                             3,567,300                411,300
     Principal repayments on long-term debt                                                             --                   (4,700)
     Increase in capital leases                                                                       12,100                   --
     Payments on obligations under capital leases                                                     (3,800)                (7,700)
     Principal repayments on note payable                                                           (888,800)               (13,200)
                                                                                                 -----------            -----------
              Net cash provided by financing activities                                            2,701,600                404,400
                                                                                                 -----------            -----------

NET INCREASE/(DECREASE) IN CASH                                                                    2,573,400               (417,500)

CASH, beginning of period                                                                            475,300                690,500
                                                                                                 -----------            -----------

CASH, end of period                                                                              $ 3,048,700            $   273,000
                                                                                                 ===========            ===========


<FN>

The accompanying notes are an integral part of these financial statements
</FN>
</TABLE>
                                                                 4

<PAGE>



ZAPWORLD.COM
NOTES TO THE INTERIM UNAUDITED CONDENSED FINANCIAL STATEMENTS

(1)   Basis of Presentation

The financial  statements included in this Form 10-QSB have been prepared by the
Company,  without audit, pursuant to the rules and regulations of the Securities
and Exchange  Commission.  Certain information and footnote disclosures normally
included in financial  statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted, pursuant to such rules and
regulations,  although  management believes the disclosures are adequate to make
the  information  presented not  misleading.  The results of operations  for any
interim period are not necessarily  indicative of results for a full year. These
statements  should be read in  conjunction  with the  financial  statements  and
related  notes  included in the  Company's  Annual Report on Form 10-KSB for the
year ended December 31, 1998.

The financial statements presented herein as of June 30, 1999, and for the three
months and six months  ended June 30,  1999 and June 30,  1998  reflect,  in the
opinion  of  management,  all  material  adjustments  consisting  only of normal
recurring  adjustments  necessary  for a  fair  presentation  of  the  financial
position, results of operations and cash flow for the interim periods.

The net  income/(loss)  per common share is based on the weighted average number
of common shares outstanding in each period. Common stock equivalents associated
with  stock  options  have  been  excluded  from  the  weighted  average  shares
outstanding since the effect of these securities would be anti-dilutive.

(2) -  RECEIVABLES

                                                                June 30, 1999
                                                                -------------
Trade accounts receivable                                         $ 493,000
Less allowance for doubtful accounts                                (35,000)
                                                                  ---------
                                                                  $ 458,000
                                                                  =========

(3) - INVENTORIES

                                                                 June 30, 1999
                                                                 -------------
Raw materials                                                     $  833,500
Work-in-process                                                      179,100
Finished goods                                                       163,600
                                                                  ----------
                                                                  $1,176,200
                                                                  ==========

(4) - PROPERTY AND EQUIPMENT

                                                                  June 30, 1999
                                                                  -------------
Demonstration items                                               $  89,600
Machinery and equipment                                              97,600
Equipment under capital leases                                       45,900
Office furniture and fixtures                                        39,600
Computers                                                            75,100
Leasehold improvements                                               38,300
Vehicle                                                              77,800
                                                                  ---------
                                                                    463,900
Less accumulated depreciation and amortization                     (242,200)
                                                                  ---------
                                                                  $ 221,700
                                                                  =========

                                       5

<PAGE>

 (5) - COMMON STOCK

The Company's  Common Stock is traded on the OTC Bulletin  Board under the stock
symbol "ZAPP".  On June 25, 1999,  ZAP completed a private  placement of 571,429
shares  of its  common  stock at a price of $3.50 per  share  and  realized  net
proceeds of $1,754,000 that includes underwriting fees and expenses of $246,000.
Additionally  in the second quarter of 1999, the Company 1) issued 300 shares in
payment for current  services  at a price of $6.00 per share,  2) issued  23,911
shares  in  payment  for  current  services  at a price of $3.02 per  share,  3)
realized  $55,500 in  proceeds  from the  exercise  of stock  options and issued
55,500 shares. Furthermore, the Company converted $240,800 of its remaining debt
into equity and issued 142,198 common shares.

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

Special Note Regarding Forward-Looking Statements

     Certain  statements in this Form 10-QSB,  including  information  set forth
under this Item 2. "Management's  Discussion and Analysis of Financial Condition
and Results of Operations"  constitute  "forward-looking  statements" within the
meaning of the Private  Securities  Litigation  Reform Act of 1995 (the  "ACT").
ZAPWORLD.COM  (the  "Company")  desires to avail itself of certain "safe harbor"
provisions of the Act and is therefore including this special note to enable the
Company to do so.  Forward-looking  statements  included  in this Form 10-QSB or
hereafter  included  in  other  publicly  available  documents  filed  with  the
Securities and Exchange  Commission,  reports to the Company's  stockholders and
other publicly  available  statements  issued or released by the Company involve
known and unknown risks, uncertainties,  and other factors which could cause the
Company's actual results,  performance  (financial or operating) or achievements
to differ from the future  results,  performance  (financial  or  operating)  or
achievements  expressed  or implied by such  forward  looking  statements.  Such
future results are based upon  management's  best  estimates  based upon current
conditions and the most recent results of operations.

Overview

         The Company designs,  assembles,  manufactures and distributes electric
bicycle power kits, electric bicycles,  tricycles,  scooters, and other electric
transportation  vehicles.  Historically,  unit sales have been approximately 35%
kits, 15% electric bicycles,  and 50% electric scooters.  Dollar sales have been
20% kits, 20% electric bicycles, and 60% electric scooters.

         The Company  manufactures  several electric motor kits. The Company was
issued its first United States Patent on February 13, 1996 on its electric motor
power system for  bicycles,  tricycles,  and scooters  (Patent  #5,491,390).  On
September  30, 1997,  the Company was issued its second  United States Patent on
its electric motor system (Patent #5,671,821). On December 15, 1998, the Company
was issued a United States Patent for its ZAPPY scooter (Patent #5,848,660). ZAP
also holds several  trademarks.  The "ZAP" trademark was registered on September
28,  1993  under  registration  no.  1,794,866,   the  ELECTRICRUIZER  mark  was
registered on April 2, 1999 under registration no. 2,248,753,  and the POWERBIKE
mark was  registered  on June 1, 1999  under  registration  no.  2,248,753.  The
electric motor kit  manufacturing  and  installation of the motor systems to the
bicycles and scooters is done at its Sebastopol  location.  The electric  motors
are  purchased  from an original  equipment  manufacturer  (OEM) in the auto and
air-conditioning  industry.  The  Company is using one  company  for its motors,
although there are other companies that could be used with slight  modifications
to the motor support brackets.  The batteries are standard batteries used in the
computer  industry  for power  interrupt  systems.  The  electronic  system uses
standard electronic components.  The Company has a contractual relationship with
Smith & Wesson who  provides  the Company  with Law  Enforcement  Bicycles.  The
Company  has agreed to  purchase  at least 250 bikes from Smith & Wesson  during
1999 in exchange for specific  exclusive  distribution  and pricing rights.  The
Company has no other contractual agreements with any of its other vendors.

      The  Company  as of June 30,  1999 had a  $1,130,000  sales  backlog.  The
company expects to fill these orders within the next 60 days.


                                       6
<PAGE>

     The Company's  growth  strategy is to increase net sales by augmenting  its
marketing and sales force, by increasing  distribution  channels  through retail
organizations and wholesale distributors both domestically and overseas, as well
as setting up company and franchise  stores to assist in the retail  arena.  The
Company  will  continue  to  increase  its  production  capability  to meet  the
increasing  demand for its  product.  The Company  will  continue to develop the
product with the goal of being the low cost leader in the industry.  The Company
will continue to develop new products with the goal of offering the consumer the
most  complete  line  of  electric  vehicles  available.  Product  improvements,
strategic relations, the development of the ZAP Electric Vehicle Outlet network,
and ZAP's Shopping Mall on the Internet are continuing to enlarge ZAP's presence
and brand awareness in the electric vehicle industry.
<TABLE>

Results of Operations

         The following table sets forth,  as a percentage of net sales,  certain
items included in the Company's Income Statements (see Financial  Statements and
Notes) for the periods indicated:
<CAPTION>

                                                                          Quarter ended June 30,          Six months ended June 30,
                                                                          1999             1998            1999              1998
                                                                          -----            -----           -----             -----

<S>                                                                       <C>              <C>             <C>              <C>
Statements of Income Data:
    Net sales ...............................................             100.0%           100.0%          100.0%           100.0%
    Cost of sales ...........................................              55.7             73.7            59.7             68.4
    Gross profit (Loss) .....................................              44.3             26.3            40.3             31.6
    Operating  expenses .....................................              41.0             60.0            40.6             65.8
    Income (Loss) from operations ...........................               3.3            (33.7)           (0.3)           (34.2)
    Other  income (expense) .................................               1.0             (0.9)           (2.2)            (0.4)
    Income (Loss) before income taxes .......................               4.3            (34.6)           (2.5)           (34.6)
    Provision for income taxes ..............................               0.0              0.0             0.0              0.0
    Net Income (Loss) .......................................               4.3            (34.6)           (2.5)           (34.6)

</TABLE>

Quarter Ended June 30, 1999 Compared to Quarter Ended June 30, 1998

     Net sales for the quarter ended June 30, 1999, were $1,513,100  compared to
$863,700 in the prior year,  an  increase  of $649,400 or 75%.  The  increase in
sales in 1999 over the same  period in 1998 was  largely due to the sales of the
ZAPPY scooter that accounted for $916,000 or 61% of total sales for the quarter.
This was an increase of $613,300 in sales of the ZAPPY  scooter  over the second
quarter of 1998.  The sales of the ZAPPY  scooter have  increased as the product
has become more widely recognized throughout the world.

     Gross profit  increased  as a percentage  of net sales to 44% from 26%. The
total gross  profit  increased  $443,100 or 195%.  The  increase in gross margin
dollars can be primarily  attributed to margins  generated from the sales of the
ZAPPY scooter.  The increase in gross margin percentage can be attributed to the
substantial  reduction in product costs that has mostly occurred  because of the
change to sourcing more materials with overseas vendors and a higher  percentage
of retail sales specifically coming from the Internet and Law Enforcement.

     Selling  expenses in the second  quarter ended June 30, 1999 were $249,100,
flat  compared to the $250,700 for the second  quarter ended June 30, 1998. As a
percentage  of sales,  selling  expenses  decreased  from 29% of sales to 16% of
sales.

     General and  administrative  expenses  for the quarter  ended June 30, 1999
were $296,100. This was an increase of $76,200 or 35% from 1998. As a percentage
of sales,  general and  administrative  expense decreased to 20% from 25% of net
sales.  Expense  increases during the 2nd quarter of 1999 as compared to the 2nd
quarter of 1998 resulted from increased  personnel  costs,  added legal costs in
setting up the  Company's  Franchise  and Outlet  stores,  as well as  increased
credit card fees paid on larger sales.

     Research and development  increased  $28,000 or 59% from the 2nd quarter of
1998 as  compared to the 2nd quarter of 1999.  As a  percentage  of net sales it
decreased  to 5% of sales in the 2nd  quarter of 1999 as compared to 6% of sales
in the 2nd quarter of 1998.  Research and  development  costs  increased  due to
increased  demands for the  development of new products and additional  research
and analysis on new batteries, motors, and chargers.

                                       7
<PAGE>

      Other income  (expense).  Interest expense decreased in the second quarter
of 1999 by $2,600  from the second  quarter  of 1998 as most of the  outstanding
notes payable were paid off in the first quarter or early second quarter.  Other
income  increased  by  $20,500,of  which,  $13,500 was from  interest  earned on
additional capital invested into the Company.

Six Months Ended June 30, 1999 Compared to Six Months Ending June 30, 1998

     Net sales for the six months ended June 30, 1999 were  $2,677,200  compared
with $1,324,900 in the six months ended June 30, 1998, an increase of $1,352,300
or 102%. The increase in sales is primarily  attributable  to sales of the ZAPPY
scooter.  The sales of ZAPPY  scooters  accounted for $1,696,100 of sales in the
first six months of 1999  compared  to $312,300 of sales in the first six months
of 1998.

     Gross profit  increased as a percentage of net sales,  to 40% from 32%. The
total gross  profit  increased  $659,500 or 158%.  The  increase in gross margin
dollars can be primarily  attributed to gross  margins  realized on the sales of
the ZAPPY  scooters and from greater  retail sales  generated from the Internet.
The increase in gross margin  percentage  can be attributed to reduced  material
costs on  preexisting  products in the current six months as compared to the six
months ended June 30, 1998.

     Selling  expenses for the six months  ended June 30, 1999 were  $449,100 as
compared  to  $409,700  for the six  months  ended  June 30,  1998.  This was an
increase of $39,400 or 10% from 1998 to 1999. As a percentage of sales,  selling
expenses  decreased  from 31% of sales to 17% of sales.  The increase in dollars
resulted from  commissions  paid to independent  sales  representatives  selling
products to specifically  contracted areas throughout the country, and increases
in sales personnel.

     General and administrative  expenses for the six months ended June 30, 1999
were $514,300. This is an increase of $131,900 or 34% from 1998. As a percentage
of sales,  general and  administrative  expense decreased to 19% from 29% of net
sales.  Expense increases during the first six months of 1999 as compared to the
first six months of 1998  occurred  due to increased  personnel  needs to handle
additional  administrative  tasks, and upgrades and repairs to outdated computer
equipment.

     Research and development  increased $43,300 or 54% for the first six months
of 1999 as  compared  to the first six months of 1998.  As a  percentage  of net
sales, research and development decreased to 5% of sales in the first six months
of 1999 as  compared  to 6% of sales in the first six months of 1998.  Increased
personnel costs incurred to help develop new products led to higher costs in the
second quarter of 1999.

     Other income (expense).  Interest expense decreased in the first six months
of 1999 by $69,400  from the first six months of 1998.  Most of the  outstanding
notes payable from 1998 were paid off during the first and early second quarters
of 1999,  resulting in the decrease.  Interest income  increased by $17,000 from
the  first six  months  of 1998 to the  first six  months of 1999 as a result of
interest earned on additional capital invested in the company.

Liquidity and Capital Resources

     The Company had cash  provided from  operations  of $11,000  during the six
months ended June 30, 1999 as compared to cash used from  operations of $725,600
for the first six months of 1998. Cash provided from operations in the first six
months  of 1999  was the  result  of the net loss  incurred  for the  period  of
$66,900,  offset by net  non-cash  expenses of  $795,900,  and the net change in
operating assets and liabilities resulting in a further use of cash of $718,000.
Cash used in  operations  for the first six months of 1998 was the result of the
net loss  incurred for the first six months of $459,400,  offset by net non-cash
expenses of  $109,200,  and the net change in operating  assets and  liabilities
resulting in further use of cash of $375,400.

     Investing activities used cash of $139,200 and $96,300 during the first six
months ended June 30, 1999 and 1998 respectively.  The uses of cash were for the
purchase of fixed assets and the Company's investment in Electric Motorbike Inc.
for certain technology and option rights.

                                       8
<PAGE>

     Financing  activities  provided cash of $3,022,700 and $404,400  during the
first six months ended June 30, 1999 and 1998  respectively.  In both years, the
cash provided by financing  activities  resulted from the sales of common stock,
$3,888,400  and  $411,300  for the first six months ended June 30, 1999 and 1998
respectively, offset by principal payments on outstanding debt.

     At June 30, 1999,  the Company had cash and cash  equivalents of $3,048,700
as  compared to $273,000 at June 30,  1998.  At June 30,  1999,  the Company had
working capital of $4,266,800 as compared to working capital of $693,600 at June
30, 1998. The increase in both cash and cash  equivalents and working capital in
the first six months of 1999 over the first six months of 1998 are primarily due
to the proceeds  received from the Company's  private  placement  offering which
more than offset the Company's  net losses during the same period.  The Company,
at  present,  does  not  have a credit  facility  in place  with a bank or other
financial  institution.  The Company  has  established  an  accounts  receivable
facility that is guaranteed by the U.S. Exim Bank. The Company believes that the
cash and cash  equivalents on hand at June 30, 1999, will be sufficient to allow
the Company to continue its expected  level of  operations  for the remainder of
the year.

     The Company's primary capital needs are to fund its growth strategy,  which
includes increasing its internet shopping mall presence, increasing distribution
channels,  establishing company owned and franchised ZAP stores, introducing new
products,  improving  existing  product lines and developing of strong corporate
infrastructure.

Dates following December 31, 1999 and beyond (the "Year 2000 Problem")

     Many existing  computer systems and  applications,  and other devices,  use
only two digits to identify a year in the date field,  without  considering  the
impact of the  upcoming  change in the century.  Such  systems and  applications
could fail or create erroneous results unless  corrected.  The Company relies on
its internal financial systems and external systems of business enterprises such
as  customers,   suppliers,   creditors,   and  financial   organizations   both
domestically  and globally,  directly and  indirectly  for accurate  exchange of
data. The Company has evaluated such systems and has taken the appropriate steps
that they believe address the concerns of the Year 2000 Problem.  However,  even
though the internal  systems of the Company are not  materially  affected by the
Year  2000  issue  the  Company  could be  affected  through  disruption  in the
operation of the enterprises with which the Company interacts.


Seasonality and Quarterly Results

     The Company's business is subject to seasonal influences.  Sales volumes in
the bicycle industry  typically slow down during the winter months,  November to
March, in the U.S.

Inflation

     The  Company's  raw  materials  are sourced  from  stable cost  competitive
industries.  As such,  the Company  does not foresee any  material  inflationary
trends for its raw material sources.

                                       9


<PAGE>


Item 1.  Legal Proceedings

         In July 1999, a dismissal  order was issued in the patent  infringement
      suit  between  ZAP  and  Omni  Instruments,  under  the  leadership  of an
      individual named Joseph Stevenson. In consideration of the dismissal,  ZAP
      was  required to pay to Omni an  immaterial  amount of cash and stock.  In
      consideration  for the  amount  paid,  Omni  stipulated  to  stop  making,
      advertising,  and/or  selling the EROS electric  system for bicycles sixty
      (60) days after entry of the order approving the stipulation.  Omni agrees
      to sell only the products in its inventory,  not to exceed a maximum of 80
      EROS systems.

Item 2.  Changes in Securities

     There were no changes in rights of securities holders.

Item 3.  Defaults Upon Senior Securities

     There were no defaults upon senior securities.

Item 4.  Submission of Matters to a Vote of Security Holders

     There were no matters submitted to the vote of security holders.

Item 5.  Other Information

     There were no major contracts signed during the period.

Item 6.  Exhibits and Reports on Form 8-K

     No reports on Form 8-K were filed during the quarter.


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<PAGE>

                                   SIGNATURES

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


          ZAPWORLD.COM
-------------------------------------------
          (Registrant)


Date
     ------------------      ---------------------------------------------------
                                    James McGreen - President and Director


Date
     ------------------      ---------------------------------------------------
                                   Gary Starr - Managing Director and Chief
                                   Financial Officer






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