<PAGE>

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

                                  FORM 10-QSB

        (X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE 
                       SECURITIES EXCHANGE ACT OF 1934 
                For the quarterly period ended March 31, 1999

           ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) 
                 OF THE SECURITIES EXCHANGE ACT OF 1934 
               For the transition period from ____ to ____

                        Commission File Number 000-9812

                       GREASE MONKEY HOLDING CORPORATION
                       ---------------------------------
       (Exact name of small business issuer as specified in its charter)

             Utah                                       87-0321320
----------------------------------            ---------------------------------
  (State or other jurisdiction                (IRS Employer Identification No.)
of incorporation or organization)

                           633 17th Street, Suite 400
                             Denver, Colorado 80202
                           ---------------------------
                    (Address of principal executive offices)

                                 (303) 308-1660
                                 --------------
                           (Issuer's telephone number)

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

                                    Yes  X   No
                                       -----    -----

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

                                                       Outstanding at
                 Class                                  May 3, 1999
     -----------------------------                    ----------------
     Common Stock, $0.03 par value                    4,678,369 shares

Transitional Small Business Disclosure Format         Yes      No  X  
                                                         -----   -----

<PAGE>

                        GREASE MONKEY HOLDING CORPORATION

                        COMMISSION FILE NUMBER: 000-9812

                          QUARTER ENDED MARCH 31, 1999

                                   FORM 10-QSB

<TABLE>
<S>                                                                         <C>
                 PART I FINANCIAL INFORMATION

Consolidated Statements of Operations.....................................  Page 1

Consolidated Balance Sheets...............................................  Page 2

Consolidated Statements of Stockholders' Equity (Deficit).................  Page 4

Consolidated Statements of Cash Flows.....................................  Page 5

Notes to Consolidated Financial Statements................................  Page 7

Management's Discussion and Analysis or Plan
  of Operation............................................................  Page 11

                   PART II OTHER INFORMATION

Legal Proceedings.........................................................  Page 18

Exhibits and Reports on Form 8-K..........................................  Page 19

Signatures................................................................  Page 20

</TABLE>

<PAGE>

               GREASE MONKEY HOLDING CORPORATION AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
                                                                 Three Months Ended
                                                                     March 31,
                                                            ---------------------------
                                                                1999           1998
                                                            -----------     -----------
<S>                                                         <C>             <C>
Operating Revenue:                                                                                                     
  Royalty fees.......................................       $   673,093         742,283
  Franchise sales - center openings..................            46,960               -
  Product and equipment revenue......................           113,803         180,929
  Sales by Company-owned Centers.....................         3,813,951       3,698,874
  Leasing revenue....................................           227,831         328,699
  Other..............................................            18,376          18,916
                                                            -----------     -----------
                                                              4,894,014       4,969,701
                                                            -----------     -----------
Operating Expenses:
  Franchise costs - center openings..................             6,166           5,500
  Product and equipment costs........................            42,357          82,593
  Company-owned Centers..............................         3,133,841       3,167,710
  Leasing expense....................................           275,232         356,636
  General and administrative expenses................           900,881       1,272,904
  Provision for credit losses........................            43,503          42,500
  Depreciation.......................................           178,013         165,749
  Amortization.......................................            73,270          71,333
                                                            -----------     -----------
                                                              4,653,263       5,164,925
                                                            -----------     -----------
Operating income (loss)..............................           240,751        (195,224)
                                                            -----------     -----------
Other income (expense):
  Loss on sale/disposition/closure of centers........            (9,912)        (50,512)
  Undeveloped franchise licenses canceled............                 -          31,983
  Interest income....................................             3,547          11,235
  Interest expense...................................          (242,572)       (213,717)
                                                            -----------     -----------
                                                               (248,937)       (221,011)
                                                            -----------     -----------
Net loss.............................................       $    (8,186)       (416,235)
                                                            -----------     -----------
                                                            -----------     -----------
Loss per common share (Note 5).......................       $     (0.01)          (0.10)
                                                            -----------     -----------
                                                            -----------     -----------
Weighted average shares outstanding..................         4,651,268       4,641,805
                                                            -----------     -----------
                                                            -----------     -----------
</TABLE>

                                  (UNAUDITED)

                                       1
<PAGE>

               GREASE MONKEY HOLDING CORPORATION AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                                   MARCH 31,              DECEMBER 31,
                                                                                     1999                     1998
                                                                                  ------------            ------------
<S>                                                                               <C>                     <C>
ASSETS
Current Assets:
  Cash..............................................................              $    209,147                 145,470
  Accounts receivable, net of allowance for                                                                            
    doubtful accounts of $509,036 at March 31, 1999,                                                                   
    and $471,571 at December 31, 1998...............................                   734,267                 742,169
  Current portion of notes receivable, net..........................                    80,432                  60,885
  Current portion of net investment                                                                                    
    in direct financing leases......................................                   211,380                 183,775
  Inventories.......................................................                   618,088                 647,530
  Prepaid expenses and supplies.....................................                   189,915                 219,635
                                                                                  ------------            ------------
    TOTAL CURRENT ASSETS............................................                 2,043,229               1,999,464
                                                                                  ------------            ------------
Property and Equipment:
  Land..............................................................                   708,838                 805,432
  Buildings (including buildings under capital leases)..............                 6,835,896               6,859,365
  Furniture and fixtures............................................                   699,695                 674,553
  Leasehold improvements............................................                   806,871                 823,657
  Machinery and equipment ..........................................                 1,882,614               1,883,693
                                                                                  ------------            ------------
                                                                                    10,933,914              11,046,700
  Less accumulated depreciation.....................................                (4,415,138)             (4,508,081)
                                                                                  ------------            ------------
    NET PROPERTY AND EQUIPMENT......................................                 6,518,776               6,538,619
                                                                                  ------------            ------------
Other Assets:
  Net investment in direct financing leases.........................                 1,817,009               2,023,193
  Notes receivable, net.............................................                    87,915                  81,919
  Deferred franchising costs........................................                   107,653                 113,819
  Goodwill and covenants not to compete, net of accumulated 
    amortization of $1,405,035 at March 31, 1999, and $1,373,453 
    at December 31, 1998............................................                 2,265,470               2,322,422
  Land held for development/resale..................................                   800,854                 818,300
  Other assets, net of accumulated amortization of $86,444 at 
    March 31, 1999, and $70,126 at December 31, 1998................                   272,680                 314,528
                                                                                  ------------            ------------
    TOTAL OTHER ASSETS..............................................                 5,351,581               5,674,181
                                                                                  ------------            ------------
                                                                                  $ 13,913,586              14,212,264
                                                                                  ------------            ------------
                                                                                  ------------            ------------

</TABLE>

                                   (UNAUDITED)
                            (continued on next page)

                                        2
<PAGE>

               GREASE MONKEY HOLDING CORPORATION AND SUBSIDIARIES
                     CONSOLIDATED BALANCE SHEETS (CONTINUED)

<TABLE>
<CAPTION>
                                                                                   MARCH 31,              DECEMBER 31,
                                                                                     1999                     1998
                                                                                  ------------            ------------
<S>                                                                               <C>                     <C>
LIABILITIES AND STOCKHOLDERS' DEFICIT

Current Liabilities:
  Accounts payable..................................................              $  1,454,461               1,674,175
  Accrued salaries and wages........................................                   216,466                 190,982
  Other accrued liabilities.........................................                   338,632                 377,799
  Current portion of long-term obligations..........................                 1,102,563               1,084,617
  Current portion of obligations under capital leases...............                   506,323                 479,844
                                                                                  ------------            ------------
    TOTAL CURRENT LIABILITIES.......................................                 3,618,445               3,807,417
                                                                                  ------------            ------------
Long-term Obligations...............................................                 5,475,489               5,418,008

Obligations Under Capital Leases....................................                 5,661,217               5,801,910

Deferred Franchise Sales Revenue....................................                   428,693                 467,253

Stockholders' Deficit:
  Series C Preferred stock, stated value of $100.00 per share, 
    20,896 shares issued and outstanding at March 31, 1999 and 
    December 31, 1998...............................................                 2,089,638               2,089,638
  Common stock, par value $.03, 20,000,000 shares authorized, 
    4,678,369 and 4,647,880 shares issued and outstanding at 
    March 31, 1999 and December 31, 1998, respectively..............                   140,351                 139,436
  Capital in excess of par value....................................                 6,348,070               6,328,733
  Accumulated deficit...............................................                (9,848,317)             (9,840,131)
                                                                                  ------------            ------------
      TOTAL STOCKHOLDERS' DEFICIT...................................                (1,270,258)             (1,282,324)

  Commitments and Contingencies.....................................
                                                                                  ------------            ------------
                                                                                  $ 13,913,586              14,212,264
                                                                                  ------------            ------------
                                                                                  ------------            ------------

</TABLE>

                                   (UNAUDITED)

                                        3
<PAGE>

               GREASE MONKEY HOLDING CORPORATION AND SUBSIDIARIES
            CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)

<TABLE>
<CAPTION>
                                              Preferred Stock                  Common Stock
                                          ----------------------    -----------------------------------
                                                                                             Capital in
                                          Number of                 Number of                 Excess of   Accumulated
                                            Shares      Amount        Shares      Amount     Par Value      Deficit       Total
                                          ---------  -----------    ---------   ----------   ----------   -----------   ----------
<S>                                       <C>        <C>            <C>         <C>          <C>          <C>           <C>
Balance at December 31, 1997............    20,896   $ 2,089,638    4,633,570    $ 139,007    6,197,880   (7,810,283)      616,242
Issuance of common stock pursuant                                                           
  to employee benefit plan..............         -             -       10,810          324       13,145            -        13,469
Issuance of common stock upon exercise                                                      
  of employee stock options.............         -             -        3,500          105        1,708            -         1,813
Fair value of warrants issued...........         -             -            -            -      116,000            -       116,000
Net loss................................         -             -            -            -            -   (2,029,848)   (2,029,848)
                                            ------   -----------    ---------    ---------    ---------   ----------    ----------
Balance at December 31, 1998............    20,896     2,089,638    4,647,880      139,436    6,328,733   (9,840,131)   (1,282,324)
Issuance of common stock pursuant                                                           
  to employee benefit plan..............         -             -       30,489          915       19,337            -        20,252
Net loss................................         -             -            -            -            -       (8,186)       (8,186)
                                            ------   -----------    ---------    ---------    ---------   ----------    ----------
Balance at March 31, 1999...............    20,896   $ 2,089,638    4,678,369    $ 140,351    6,348,070   (9,848,317)   (1,270,258)
                                            ------   -----------    ---------    ---------    ---------   ----------    ----------
                                            ------   -----------    ---------    ---------    ---------   ----------    ----------

</TABLE>

                                   (UNAUDITED)

                                        4

<PAGE>

               GREASE MONKEY HOLDING CORPORATION AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                                 THREE MONTHS ENDED
                                                                                     MARCH 31,
                                                                          -----------------------------
                                                                             1999                1998
                                                                          ----------          ---------
<S>                                                                       <C>                 <C>
Cash flows from operating activities:
  Net loss..............................................................  $   (8,186)          (416,235)
  Adjustments to reconcile net loss to net cash provided by
    (used in) operating activities:
      Increase in deferred franchise sales revenue......................       8,400             39,000
      Franchise sales revenue recognized - center openings..............     (46,960)                 -
      Increase in deferred franchising costs............................           -            (19,927)
      Franchise costs recognized - center openings......................       6,166                  -
      Provision for credit losses.......................................      43,503             42,500
      Loss realized on sale/retirement of property and equipment........           -              1,453
      Depreciation and amortization.....................................     251,283            237,082
      Undeveloped franchise licenses canceled...........................           -            (31,983)
      Loss on sale/disposition/closure of centers.......................      10,590             36,767
      Fair value of warrants issued.....................................      21,861                  -
      Net change in operating assets and liabilities:
        Increase in accounts receivable.................................     (54,746)           (45,343)
        Decrease in notes receivable....................................      13,600             18,873
        Decrease (increase) in inventories..............................      27,084            (32,257)
        Decrease (increase) in prepaid expenses and supplies............       7,986            (49,942)
        Increase (decrease) in accounts payable.........................    (219,713)            52,150
        Increase in accrued salaries and wages and other liabilities....       6,569            140,006
                                                                          ----------           --------
      Net cash provided by (used in) operating activities...............  $   67,437            (27,856)
                                                                          ----------           --------

</TABLE>

                                   (UNAUDITED)
                            (continued on next page)
                                        5

<PAGE>

               GREASE MONKEY HOLDING CORPORATION AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)

<TABLE>
<CAPTION>
                                                                                 THREE MONTHS ENDED
                                                                                     MARCH 31,
                                                                          -----------------------------
                                                                             1999                1998
                                                                          ----------          ---------
<S>                                                                       <C>                 <C>
Cash flows from investing activities:
  Principal receipts on direct financing leases.........................  $   40,956             44,219
  Proceeds from sale of property and equipment..........................      88,009                  -
  Proceeds from sale of centers.........................................           -            115,450
  Purchase of property and equipment....................................    (110,571)           (30,192)
  Decrease (increase) in projects and development.......................      17,446           (595,927)
  Decrease (increase) in other assets...................................      19,967            (63,588)
                                                                          ----------           --------
        Net cash provided by (used in) investing activities.............      55,807           (530,038)
                                                                          ----------           --------

Cash flows from financing activities:
  Proceeds from long-term obligations...................................     181,400            710,500
  Principal payments on long-term obligations...........................    (125,353)          (140,729)
  Principal payments on capital lease obligations.......................    (114,139)          (105,955)
  Issuance of common stock..............................................           -                751
  Increase in restricted cash...........................................           -            (25,000)
  Increase (decrease) in lease deposit obligations......................      (1,475)             3,542
                                                                          ----------           --------
        Net cash provided by (used in) financing activities.............     (59,567)           443,109
                                                                          ----------           --------
Net increase (decrease) in cash.........................................      63,677           (114,785)

Cash, beginning of period...............................................     145,470            182,214
                                                                          ----------           --------
Cash, end of period.....................................................  $  209,147             67,429
                                                                          ----------           --------
                                                                          ----------           --------
Supplemental disclosures of cash flow information -
  Cash paid during the period for interest..............................  $  343,000            320,416
                                                                          ----------           --------
                                                                          ----------           --------

</TABLE>

                                   (UNAUDITED)

                                        6

<PAGE>

               GREASE MONKEY HOLDING CORPORATION AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.   GENERAL

     The financial statements included herein are unaudited and have been
     prepared in accordance with generally accepted accounting principles for
     interim financial reporting and Securities and Exchange Commission
     regulations. Certain information and footnote disclosures normally included
     in financial statements prepared in accordance with generally accepted
     accounting principals have been condensed or omitted pursuant to such rules
     and regulations.

     In the opinion of management, the financial statements reflect all
     adjustments of a normal and recurring nature which are necessary to present
     fairly the financial position, results of operations and cash flows for the
     interim periods. These financial statements should be read in conjunction
     with the Annual Report of Grease Monkey Holding Corporation (the "Company")
     on Form 10-KSB for the year ended December 31, 1998.

     The results for the three-month period ended March 31, 1999, are not
     necessarily indicative of the results to be expected for the entire fiscal
     year of 1999.

2.   LIQUIDITY

     The Company has incurred losses from operations that have increased over
     the past three years coupled with a decrease in cash flow from operations
     for the same period. As of March 31, 1999, the Company had a working
     capital deficit of $1,575,216 and total liabilities exceeded total assets.
     These factors among others may indicate that the Company may not be able to
     meet its obligations in a timely manner without increased cash flow from
     operations, sale of non-producing assets or additional financing.

     The Company has taken steps to reduce losses and generate cash flow from
     operations and anticipates the sale of non-producing assets which will
     generate sufficient cash flow to meet its obligations in a timely manner.
     Should the Company be unable to achieve its projected level of cash flow
     from operations or sell its non-producing assets, additional financing
     could be necessary. The Company has entered into a merger agreement that
     would result in the sale of the Company. As a result of the current merger
     agreement, the Company is not actively investigating financing
     alternatives. Should the merger not proceed, the Company believes it could
     obtain additional financing, however, there can be no assurance that such
     financing would be available on a timely basis or on acceptable terms.

3.   MERGER AGREEMENT WITH QL 3000, INC.

     Effective March 26, 1999, the Company entered into a merger agreement with
     QL 3000, Inc., a privately held company. The merger agreement provides that
     each shareholder of the Company will receive $1 per outstanding share of
     common stock and each preferred shareholder will receive the stated value
     of their preferred stock in addition to all applicable unpaid dividends.
     The completion of the merger agreement is subject to QL 3000, Inc.
     obtaining appropriate financing for the acquisition, in addition to
     regulatory and shareholder approval. Should the merger agreement be
     consumated, the Company would incur approximately $270,000 of transaction
     costs.

                                   (continued)

                                        7
<PAGE>

               GREASE MONKEY HOLDING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

4.   STOCKHOLDERS' EQUITY (DEFICIT)

     The Company's Series C, 6% cumulative, Preferred stock is redeemable at the
     option of the Company upon 60 days prior written notice. At the option of
     the holder, at any time prior to the close of business on the redemption
     date, each share of Series C Preferred stock, plus any accumulated unpaid
     dividends, may be converted into shares of common stock at a conversion
     price of $2.50 per share of common stock. On March 31, 1999, accumulated
     unpaid dividends totaled $663,926.

     The Company has an employee deferred compensation 401(k) plan and matches
     employee contributions to this plan in an amount equal to 50% of the
     employees' contribution, up to a maximum of 6% of the employees'
     compensation. The Company's contribution is paid with its $0.03 par value
     common stock (net of forfeitures) valued at market on the date of the
     contribution. During the first three months of 1999 and 1998, the Company
     contributed 30,489 and 10,735 shares to this plan at an average of $0.66
     and $1.25 per share, respectively.

5.   LOSS PER SHARE

     Loss per common share is computed by dividing the net loss after reduction
     for dividends on preferred stock ($30,915 in 1999 and $31,602 in 1998) by
     the weighted average number of common shares outstanding during each
     period. The effects of potentially dilutive stock options and convertible
     securities outstanding were antidilutive in 1999 and 1998.

6.   COMMITMENTS AND CONTINGENCIES

     LEGAL PROCEEDINGS

     On December 15, 1998, a demand for arbitration was made against the Company
     by Navfam, Inc. based upon the Company's alleged breach of a Software
     License Agreement dated April 7, 1998. That matter is governed by the
     American Arbitration Association in Los Angeles, California, and has been
     assigned Case No. 72Y1140138198. Unspecified damages have been claimed by
     Navfam, Inc. in excess of $250,000. In response to the arbitration demand,
     the Company has specifically denied Navfam, Inc.'s claim.

     On September 16, 1998, a lawsuit was filed against the Company by Barrett
     Commercial, Inc. in the United States District Court for the Central
     District of California, BARRETT COMMERCIAL, INC. V. GREASE MONKEY
     INTERNATIONAL, INC., No. SACV 98-1123GLT(EEx). In that action, Barrett
     alleges the existence of a contract with the Company to work as development
     partners in Southern California for the purpose of building ten stores.
     Barrett claims unsubstantiated losses of $1,300,000 for expenditures made
     in pursuing that development which was never completed. Barrett claims the
     Company is in breach of the alleged agreement as a result of its refusal to
     reimburse it for those alleged expenditures.

                                   (continued)

                                       8
<PAGE>

               GREASE MONKEY HOLDING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

     The Company has generally denied those claims and believes and has asserted
     that they are frivolous and groundless. Barrett has been unable to produce
     the alleged contract and the Company believes none was ever created. In
     addition, the Company believes Barrett lacks any evidence to support his
     claim of the alleged expenditures pursuant to the Southern California
     development. The Company intends to defend vigorously said claims and its
     liability exposure at the present time appears to be nominal. The Company
     believes the likelihood of an unfavorable outcome in this matter is remote.

     The Company is involved in various other claims and legal actions arising
     in the ordinary course of business. In the opinion of management, the
     ultimate disposition of these matters will not have a material adverse
     effect on the Company's consolidated financial position, results of
     operations or liquidity.

     FINANCIAL GUARANTEES

     The Company has guaranteed leases of four franchisees. The aggregate
     contingent liability under the lease guarantees totals approximately
     $1,300,000. In addition, the Company has guaranteed notes payables of two
     franchisees totaling approximately $750,000 and has guaranteed notes
     payable to oil suppliers for certain franchisees.

     The Company is committed to the lease of office and training facilities
     under a lease expiring in November 2008. Rent under the lease is
     approximately $18,000 per month.

                                   (continued)

                                       9
<PAGE>

               GREASE MONKEY HOLDING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

7.   SUPPLEMENTAL STATEMENT OF CASH FLOW INFORMATION

The following table sets forth, by period, the amount and nature of amounts paid
and received for the acquisition, sale (refranchising) and closure of
Company-owned Centers.

<TABLE>
<CAPTION>
                                                                   THREE MONTHS ENDED
                                                                        MARCH 31,
                                                                ------------------------
                                                                   1999          1998
                                                                ---------      ---------
<S>                                                             <C>            <C>
Acquisition of Centers:
  Number of Centers purchased...........................                1              -
                                                                ---------      ---------
                                                                ---------      ---------
  Number of Centers foreclosed..........................                -              2
                                                                ---------      ---------
                                                                ---------      ---------
  Receivables applied (net of related allowance)........        $       -         30,703
  Liabilities assumed...................................           19,379         38,400
  Cash paid ............................................                -              -
                                                                ---------      ---------
  Cost of assets acquired...............................        $  19,379         69,103
                                                                ---------      ---------
                                                                ---------      ---------
Sales:
  Number of Centers refranchised/sold/closed............                1              2
                                                                ---------      ---------
                                                                ---------      ---------
  Cash received.........................................        $       -        115,450
  Notes received/accounts receivable granted............           20,000         15,769
  Loss on sale..........................................           10,590         36,767
                                                                ---------      ---------
  Net book value of centers refranchised/sold/closed....        $  30,590        167,986
                                                                ---------      ---------
                                                                ---------      ---------

</TABLE>

     During the three months ended March 31, 1999 and 1998, non-cash 
transactions consisted of the Company issuing 30,489 and 10,735 shares of 
common stock at an average value of $0.66 and $1.25 per share, respectively, 
in accordance with its matching requirement under the Company's 401(k) plan. 
There were no other non-cash transactions during the first three months of 
1999. Other non-cash transactions during the first three months of 1998 
included a franchise license in the amount of $10,000, net of deferred costs 
of $2,173, that was canceled and applied to a franchisee's obligation to the 
Company.

                                       10
<PAGE>

               GREASE MONKEY HOLDING CORPORATION AND SUBSIDIARIES

            MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

RESULTS OF OPERATIONS

     The Company reported a loss of ($8,186) for the first quarter of 1999, 
as compared to a loss of ($416,235) for the first quarter of 1998. Total 
revenue remained relatively constant, decreasing by $75,687 or less than 2%.

     Royalty fees are a percentage of gross sales paid monthly by all 
franchised Grease Monkey Centers. Royalty fee revenue for the first quarter 
of 1999 decreased by $69,190 or 9% compared to the first quarter of 1998. 
This decrease is due primarily to a reduction in the average number of U.S. 
franchised Centers open during the respective periods. In the first quarter 
of 1999, an average of 158 franchised Centers were open and operating as 
compared to 160 Centers in the first quarter of 1998. Factored into this 
average was the loss of twelve mature Centers (includes the acquisition of 2 
Centers by the Company) offset by the addition of thirteen new Centers. While 
these mature Centers were replaced in number by the new Centers, the new 
Centers are in the early stages of development and do not generate the level 
of sales of a mature Center. In addition, the Company signed a Master 
Franchise Agreement for the Republic of Mexico on August 1, 1998 ("the 
Agreement"). The Master Franchisee retains eighty percent of royalties and 
franchise fees collected from Mexico franchisees after the effective date of 
the Agreement. The decrease in royalty revenue related to this transaction, 
when compared with the prior year is approximately $11,000. Based upon many 
factors, including the age of amounts owed the Company, the extent of 
collateralization, and historical performance, the Company may place certain 
financially troubled franchisees on a non-accrual status. For the first 
quarter of 1999, estimated royalties of $61,330 were not accrued under this 
policy, compared to $50,670 for the first quarter of 1998. The Company has a 
royalty rebate program for franchisees under which eligible franchisees can 
receive a rebate of royalties paid. For the first quarter of 1999, the rebate 
accrued under this program was $49,710 compared to $55,990 for the first 
quarter of 1998. The rebate is recorded as a reduction in royalty revenue.

     The Company recognized franchise sales net revenue (sales net of related 
costs) of $40,794 during the first quarter of 1999 (representing four 
centers). Franchise sales revenue represents initial one-time payments 
received by the Company from buyers of its franchises. The fee and any 
directly related costs are recognized as revenue and expense when the related 
franchise center opens for business. There were no center openings during the 
first quarter of 1998.

     At March 31, 1999, the Company operated 33 Centers as compared to 31 
Centers at March 31, 1998. For the first quarter of 1999, the Company 
reported an operating margin (Company-owned Center sales less expenses, 
excluding interest, depreciation and amortization) of $680,110 on revenue of 
$3,813,951 at Company-owned Centers, as compared to an operating margin of 
$531,164 on revenue of $3,698,874 for the same period last year. This 
represents an increase of 3% in revenue and 28% in operating margin.

     In the first quarter of 1999, the Company realized marketing allowances 
and gross margins on product and equipment sales of $71,446, as compared to 
$98,336 in the first quarter of 1998. Product

                                   (continued)

                                       11
<PAGE>

               GREASE MONKEY HOLDING CORPORATION AND SUBSIDIARIES

      MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION (CONTINUED)

and equipment revenue represents the sale of fluid dispensing equipment and 
other supplies to franchisees, and marketing allowances relate to the sale of 
oil filters, air filters, oil additives, and certain other products.

     General and administrative expenses for the first quarter of 1999 
decreased 29% or $372,023 as compared to the first quarter of 1998. The 
primary factors causing this variance were: a reduction in salaries and 
personnel expenses of approximately $246,000 or 38%; a reduction in travel 
and entertainment expenses of approximately $63,000 or 38%; and a reduction 
in professional fees for legal, tax and accounting services of approximately 
$73,000 or 52%.

     Depreciation and amortization expense for the first quarter of 1999 
increased 6% over the first quarter of 1998. This increase is due primarily 
to an increase of two Company-owned Centers over the prior year.

     Loss on sale/disposition/closure of centers represents the net results 
of the refranchising/disposal of Company-owned Centers. When the Company 
refranchises a Center, a franchise license fee is included in the sales price 
and included in the resulting gain or loss on sale. The loss of $9,912 for 
the quarter ended March 31, 1999, represents the refranchising of one 
Company-owned Center, marketing allowances paid based on subsidies granted 
certain franchisees on the refranchising of Company-owned Centers in 1996, 
and a reimbursement of costs previously expensed upon the closure of a 
Company-owned Center in 1997. The loss of $50,512 for the quarter ended March 
31, 1998, represents the closure of a Company-owned Center in 1998, marketing 
allowances paid based on subsidies granted certain franchisees on the 
refranchising of Company-owned Centers in 1996, and additional costs incurred 
in 1998 related to the closure of Company-owned Centers closed in 1997. In 
addition, a loss was recognized on the sale of a Company-owned Center to a 
third party.

     Interest expense includes interest on debt financing and interest 
recorded on capital leases of Company-owned Centers. The increase in interest 
expense from $213,717 in the first quarter of 1998 to $242,572 in the first 
quarter of 1999 was due primarily to an increase in average debt outstanding 
of approximately $1,700,000. This increase is due in part to borrowings 
associated with the purchase/development of two Company-owned Centers, and 
the purchase of land for development in 1998. In addition, approximately 
$780,000 ($409,000 from a related party) was borrowed for working capital.

                                   (continued)

                                       12
<PAGE>

               GREASE MONKEY HOLDING CORPORATION AND SUBSIDIARIES

      MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION (CONTINUED)

     The following schedule summarizes the activity with regard to Grease 
Monkey Company-owned Centers as well as Grease Monkey franchised centers for 
the quarters ended March 31, 1999 and 1998.

<TABLE>
<CAPTION>
                                                                  THREE MONTHS ENDED:
                                                  MARCH 31, 1999                          MARCH 31, 1998
                                       -----------------------------------     ------------------------------------
                                       Company     Franchisee                  Company     Franchisee
                                        Owned        Owned          Total       Owned        Owned           Total
                                       -------     ----------      -------     -------     ----------      --------
<S>                                    <C>         <C>             <C>         <C>         <C>             <C>
Centers open, beginning                    33             182          215         31            187            218
Centers opened                              -               4            4          -              -              -
Centers purchased                           -               -            -          -              -              -
Centers sold                               (1)              1            -         (1)             -             (1)
Centers terminated or closed                -              (1)          (1)        (1)            (6)            (7)
Centers reacquired                          1              (1)           -          2             (2)             -
                                         ----           -----      -------       ----          -----       --------
Centers open, ending (A)                   33             185          218         31            179            210
                                         ----           -----      -------       ----          -----       --------
                                         ----           -----      -------       ----          -----       --------
Vehicles serviced (000's)                                              652                                      661
                                                                   -------                                 --------
                                                                   -------                                 --------
Franchise licenses issued (B)                                            1                                        1
                                                                   -------                                 --------
                                                                   -------                                 --------
Undeveloped franchise licenses (C)                                      22                                       48
                                                                   -------                                 --------
                                                                   -------                                 --------
Franchise applications outstanding (C)                                  10                                       20
                                                                   -------                                 --------
                                                                   -------                                 --------
Franchise license/application 
  fees received (D)                                                $ 8,400                                 $ 39,000
                                                                   -------                                 --------
                                                                   -------                                 --------

</TABLE>

(A)  Includes 26 franchised centers in Mexico in 1999 and 21 franchised centers
     in Mexico in 1998.

(B)  Represents the number of licenses issued during the period.

(C)  Represents the number of licenses/applications outstanding at March 31.

(D)  Represents amounts received for franchise licenses/applications during the
     period.

                                   (continued)

                                       13
<PAGE>

               GREASE MONKEY HOLDING CORPORATION AND SUBSIDIARIES

            MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
                                   (CONTINUED)

LIQUIDITY AND CAPITAL RESOURCES

CAPITAL RESOURCES

     The Company currently has lines of credit with varying interest rates 
from a or guaranteed by a related party. The lines total $489,000 of which 
$484,500 was outstanding at March 31, 1999. Monthly payments are interest 
only and the balance is due upon demand.

     In September 1997, the Company entered into a $5,000,000 Loan Agreement 
with a bank. In connection with the Company entering into a Master Supply 
Contract with a motor oil supplier, the supplier agreed to guarantee the 
loan. Draws under the Loan Agreement were used for the purpose of paying off 
certain debt, including the Company's former Loan Agreement and Fast Lube 
Supply Agreement, and will be used for acquiring, constructing and/or 
developing Company Centers and for working capital. Any draws are evidenced 
by notes which amortize over ten years with a five year ballon payment and 
bear interest at a rate provided under the Loan Agreement plus guarantee 
fees. For an increased guarantee fee, the Company can extend the payment 
terms an additional five years. An initial draw of $2,620,000 was made on 
September 29, 1997, with interest at 9.26% plus guarantee fees. Additional 
draws totaling $2,380,000 were made during 1998 and during the first quarter 
of 1999, with an average interest rate of approximately 9% plus guarantee 
fees. As of March 31, 1999, approximately $4,630,000 is outstanding under the 
loan agreement.

     In May 1996, the Company entered into a Business Loan Agreement with a 
bank for a $2,000,000 three year line of credit. Funds drawn under the line 
are restricted to the development of new Centers. The Company has the right 
to select an optional interest rate as described in the agreement, however, 
in no case will the interest rate exceed the bank's reference rate. In 
exchange for a supply agreement on any Centers built utilizing the line of 
credit, a motor oil supplier agreed to guarantee the line. As of March 31, 
1999, there were no amounts outstanding under this line of credit and the 
Company is currently re-negotiating the terms of this agreement.

     The growth of the Grease Monkey system is dependent on the ability of 
the Company and its franchisees to obtain real estate development capital. 
Historically, Grease Monkey Centers have been built utilizing build-to-suit 
services, whereby the land is purchased and the building is constructed to 
the Company's specifications, then leased to the Company or to a franchisee, 
by a third party. Recently, franchisees have moved toward purchasing and 
developing the real estate for their own account, thereby creating greater 
value in their business.

                                   (continued)

                                       14
<PAGE>

               GREASE MONKEY HOLDING CORPORATION AND SUBSIDIARIES

            MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
                                   (CONTINUED)

LIQUIDITY

     Cash provided by operations during the first quarter of 1999 was $67,437 
as compared to cash used in operations of ($27,856) in the first quarter of 
1998. The most significant factors contributing to this variance were an 
improved operating margin at Company-owned Centers and a decrease in general 
and administrative expenses.

     Cash provided by investing activities was $55,807 in the first quarter 
of 1999, as compared to cash used in investing activities of ($530,038) in 
the first quarter of 1998. Cash provided in both periods consisted of 
receipts on direct financing leases which decreased over the prior period. 
Additional cash was received in the first quarter of 1999 with the sale of a 
vacant site, and additional cash was received in the first quarter of 1998 
with the sale of a Company-owned Center. Cash used in investing activities 
for the first quarter of 1998 consisted primarily of cash used for the 
development of Centers. Additional cash was used in both periods for the 
purchase of property and equipment, primarily Company-owned Center equipment.

     Cash used in financing activities was ($59,567) in the first quarter of 
1999 as compared to cash provided by financing activities of $443,109 in the 
first quarter of 1998. Cash provided by financing activities in the first 
quarter of 1999 consisted primarily of proceeds from long-term obligations 
for working capital needs and in 1998 consisted primarily of proceeds from 
long-term obligations for the development of Centers. Financing activities 
also included cash used to reduce long-term obligations and capital lease 
obligations of $239,492 in the first quarter of 1999 and $246,684 in the 
first quarter of 1998.

     The Company does not have any material commitments for capital 
expenditures other than for the required replacement or upgrade of 
underground storage tanks at Company-owned Centers and the costs to achieve 
Year 2000 compliance.

     The Company has incurred losses from operations over the past three 
years coupled with a decrease in cash flow from operations for the same 
period. As of March 31, 1999, the Company had a working capital deficit of 
$1,575,216 and total liabilities exceeded total assets. These factors among 
others may indicate that the Company may not be able to meet its obligations 
in a timely manner without increased cash flow from operations, sale of 
non-producing assets or additional financing.

     The Company has taken steps to reduce losses and generate cash flow from 
operations and anticipates the sale of non-producing assets which will 
generate sufficient cash flow to meet its obligations in a timely manner. 
Should the Company be unable to achieve its projected level of cash flow from 
operations or sell its non-producing assets, additional financing could be 
necessary. The Company has entered into a merger agreement that would result 
in the sale of the Company. As a result of the current merger agreement, the 
Company is not actively investigating financing alternatives.

                                   (continued)

                                       15
<PAGE>

               GREASE MONKEY HOLDING CORPORATION AND SUBSIDIARIES

            MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

                                   (CONTINUED)

Should the merger not proceed, the Company believes it could obtain 
additional financing, however, there can be no assurance that such financing 
would be available on a timely basis or on acceptable terms.

The Year 2000 Issue

THE PROBLEM

     The Year 2000 issue is the result of the inability of hardware, software 
and control systems to correctly identify two-digit references to specific 
years, beginning with the Year 2000. This could result in system failures or 
miscalculations causing disruptions of the Company's operations and the 
Company's suppliers.

STATE OF READINESS

     The Company has instituted a Year 2000 project. The project includes an 
evaluation of its computer systems and significant software programs. This 
evaluation includes the Company's network hardware and software, 
Point-of-Sale hardware and software at the Company-owned Centers and 
accounting and business process software. The Company has developed an 
implementation plan to replace the systems noted in its evaluation that did 
not appear to be Year 2000 compliant.

     As part of the Company's Year 2000 project, the Company plans to contact 
its significant third party suppliers, such as its oil and parts suppliers, 
to determine the extent to which the Company is vulnerable to its suppliers' 
failure to remediate their Year 2000 issues. However, the Company cannot 
assure that third-party suppliers will adequately address their Year 2000 
issues or that failure of the third-party suppliers to address their Year 
2000 issues would not have a material adverse effect on the Company or its 
operations.

     In addition, the Company has commenced initial communication with its 
franchisees to determine the extent to which the Company is vulnerable to the 
franchisees' failure to remediate their Year 2000 issues. However, the 
Company cannot assure that the franchisees will adequately address their Year 
2000 issues or that failure of the franchisees to address their Year 2000 
issues would not have a material adverse effect on the Company or its 
operations.

THE COSTS TO ADDRESS THE COMPANY'S YEAR 2000 ISSUES

     Expenditures through March 31, 1999, have been minimal. Based upon the 
findings at March 31, 1999, the Company's estimated costs of becoming Year 
2000 compliant are less than $150,000.

                                   (continued)

                                       16
<PAGE>

               GREASE MONKEY HOLDING CORPORATION AND SUBSIDIARIES

            MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
                                   (CONTINUED)

THE RISKS ASSOCIATED WITH THE COMPANY'S YEAR 2000 ISSUES

     The Company's failure to resolve Year 2000 issues on or before December 
31, 1999, could result in system failures or miscalculation causing 
disruption in operations and normal business activities. Additionally, 
failure to timely remediate Year 2000 issues by third parties upon whom the 
Company's business relies could result in disruptions in the Company's supply 
of parts and materials or result in other problems related to the Company's 
daily operations.

CONTINGENCY PLAN

     The Company is currently working on a contingency plan for all critical 
aspects of the Year 2000 issues.

                                       17
<PAGE>

                        GREASE MONKEY HOLDING CORPORATION

                        COMMISSION FILE NUMBER: 000-9812

                          QUARTER ENDED MARCH 31, 1999

                                   FORM 10-QSB

                            PART II OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS.

     On December 15, 1998, a demand for arbitration was made against the 
Company by Navfam, Inc. based upon the Company's alleged breach of a Software 
License Agreement dated April 7, 1998. That matter is governed by the 
American Arbitration Association in Los Angeles, California, and has been 
assigned Case No. 72Y1140138198. Unspecified damages have been claimed by 
Navfam, Inc. in excess of $250,000. In response to the arbitration demand, 
the Company has specifically denied Navfam, Inc.'s claim.

     On September 16, 1998, a lawsuit was filed against the Company by 
Barrett Commercial, Inc. in the United States District Court for the Central 
District of California, BARRETT COMMERCIAL, INC. V. GREASE MONKEY 
INTERNATIONAL, INC., No. SACV 98-1123GLT(EEx). In that action, Barrett 
alleges the existence of a contract with the Company to work as development 
partners in Southern California for the purpose of building ten stores. 
Barrett claims unsubstantiated losses of $1,300,000 for expenditures made in 
pursuing that development which was never completed. Barrett claims the 
Company is in breach of the alleged agreement as a result of its refusal to 
reimburse it for those alleged expenditures.

     The Company has generally denied those claims and believes and has 
asserted that they are frivolous and groundless. Barrett has been unable to 
produce the alleged contract and the Company believes none was ever created. 
In addition, the Company believes Barrett lacks any evidence to support his 
claim of the alleged expenditures pursuant to the Southern California 
development. The Company intends to defend vigorously said claims and its 
liability exposure at the present time appears to be nominal. The Company 
believes the likelihood of an unfavorable outcome in this matter is remote.

     The Company is involved in various other claims and legal actions 
arising in the ordinary course of business. In the opinion of management, the 
ultimate disposition of these matters will not have a material adverse effect 
on the Company's consolidated financial position, results of operations or 
liquidity.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES.

(b) As of the date of filing this Quarterly Report on form 10-QSB, the 
Company is in arrears in the payment of dividends on the Series C Preferred 
Stock in the amount of approximately $679,000. Under Paragraph 5(d) of the 
Statement of Designation, Voting Powers, Preferences and Rights of the Series 
C Preferred Stock ("Statement of Designation"), if dividends on the Series C 
Preferred Stock are in 

                                       18
<PAGE>

arrears in an aggregate amount equal to at least four quarterly dividends, 
the number of members of the Board of Directors of the Company is 
automatically increased by the smallest number of directors that will 
constitute at least 25% of the Board of Directors after such increase and 
that the holders of the Series C Preferred Stock (voting as a separate voting 
group) have the exclusive right to elect, remove or replace such additional 
directors of the Company. The holders of the Series C Preferred Stock have 
not notified the Company that they have any intention to elect or serve as 
Directors.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K.

(a)      Exhibits (numbered in accordance with Item 601 of regulation S-K)

         27  Financial Data Schedule

(b)      Reports on Form 8-K

         A Current Report on Form 8-K dated March 26, 1999, was filed on March
         31, 1999, reporting under Item 5 the signing of a merger agreement
         between Grease Monkey Holding Corporation and QL 3000, Inc. The
         Agreement and Plan of Merger and a press release were filed as exhibits
         under Item 7 of the Current Report on Form 8-K.

                                       19
<PAGE>

               GREASE MONKEY HOLDING CORPORATION AND SUBSIDIARIES

                        COMMISSION FILE NUMBER: 000-9812
                          QUARTER ENDED MARCH 31, 1999
                                   FORM 10-QSB

                                   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.

                               GREASE MONKEY HOLDING CORPORATION

                               By: /s/ Rex L. Utsler
                                  --------------------------------
                                  Rex L. Utsler
                                  President and Chief Operating Officer
                                  (Principal Executive Officer, Chief Financial
                                  Officer and Principal Accounting Officer)


Denver, Colorado
May 14, 1999

                                       20