<PAGE>
 
                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C.  20549
                                AMENDMENT NO. 2
                                       TO
                                 FORM 10-KSB/A
(MARK ONE)
[X]  ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
     1934 (NO FEE REQUIRED)

                  FOR THE FISCAL YEAR ENDED DECEMBER 31, 1996
                                       OR

[ ]  TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
     OF 1934 (NO FEE REQUIRED)
     For the transition period from ___________ to _________

                         Commission File Number 0-24592

                               CINEMA RIDE, INC.
                               -----------------
                 (Name of Small Business Issuer in its Charter)

                 DELAWARE                               95-4417467
     ----------------------------------------       -------------------
        (State or other jurisdiction of              (I.R.S. Employer
         incorporation or organization)             Identification No.)
 
         12001 VENTURA PLACE, SUITE 340
            STUDIO CITY, CALIFORNIA                       91604
     ----------------------------------------       -------------------
     (Address of principal executive offices)           (Zip Code)
 
   Issuer's telephone number, including Area Code:    (818) 761-1002
                                                      --------------
 
Securities registered under Section 12(b) of the Exchange Act:  NONE

 
 
Securities registered under Section 12(g) of the Exchange Act:

                     COMMON STOCK AND REDEEMABLE WARRANTS
                               (TITLE OF CLASS)

          Check whether the Issuer (1) has 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
                                   ---      ---
<PAGE>
 
          Check if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-B is not contained herein, and will not be contained, to the best
of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-KSB or any amendment to
this Form 10-KSB.  [  ]

          The issuer's revenues for the year ended December 31, 1996 were
$3,310,163.

          As of March 21, 1997, there were 5,731,785 outstanding shares of
common stock, par value $0.01 per share.  The aggregate market value of the
voting stock of the registrant held by non-affiliates of the registrant on March
21, 1993 based on the average bid and asked price on such date was $2,044,479.

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

          Filed herewith by amendment is a revised Footnote No. 1 to
Consolidated Financial Statements.

                                       2
<PAGE>
 
                                                               CINEMA RIDE, INC.
                                                                AND SUBSIDIARIES

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

                                               CONSOLIDATED FINANCIAL STATEMENTS
                                          YEARS ENDED DECEMBER 31, 1996 AND 1995
<PAGE>
 
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS



Board of Directors
Cinema Ride, Inc. and Subsidiaries
Studio City, California


We have audited the accompanying consolidated balance sheets of Cinema Ride,
Inc. and Subsidiaries as of December 31, 1996 and 1995 and the related
consolidated statements of operations, stockholders' equity and cash flows for
the years ended December 31, 1996 and 1995.  These consolidated financial
statements are the responsibility of the Company's management.  Our
responsibility is to express an opinion on these consolidated financial
statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in these financial statements.  An audit also
includes assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation.  We believe that our audits provide a reasonable basis for our
opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of Cinema Ride, Inc.
and Subsidiaries as of December 31, 1996 and 1995, and the results of their
operations and cash flows for the years ended December 31, 1996 and 1995, in
conformity with generally accepted accounting principles.



                                              BDO SEIDMAN, LLP

Los Angeles, California
February 21, 1997


                                      F-2
<PAGE>
 
                                              CINEMA RIDE, INC. AND SUBSIDIARIES

                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


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

1. RECEIVABLES            During the year ended December 31, 1995, the Company
   FROM OFFICERS          made loans to each of its two officers in the amount
                          of $50,000. The loans bear interest at a rate of 8%
                          per year and are due on the earlier of June 30, 1998
                          or six months after the officer ceases to be an
                          employee of the Company. Principal payments of $5,000
                          per loan are due on June 30, 1996 and June 30, 1997,
                          with the balance due on June 30, 1998. Each note is
                          secured by the higher of 40,000 shares or the number
                          of shares equivalent to the unpaid value of the note.
                          The balance of the loans at December 31, 1996 is
                          $97,865, which includes $7,865 of accrued interest.
 
                                     F-14
<PAGE>
 
                                   SIGNATURES

        In accordance with the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the Registrant caused this Amendment No. 2 to
the Company's Form 10-KSB/A to be signed on its behalf by the undersigned,
thereunto duly authorized.

July 29, 1997

                                       CINEMA RIDE, INC.



                                       By: /s/  Mitch Francis
                                           ------------------------
                                           Mitch Francis, President

                                       4