U.S. SECURITIES AND EXCHANGE COMMISSION
                           WASHINGTON, D.C. 20549-1004

                                   FORM 10-QSB

(Mark one)
[X]   QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934.

                For the quarterly period ended February 28, 1999

[ ]   TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT.

             For the transition period from __________ to _________.

                         Commission File Number: 0-22889


                              ROYAL PRECISION, INC.
        (Exact Name of Small Business Issuer as Specified in Its Charter)

         Delaware                                                06-1453896
(State or Other Jurisdiction of                               (I.R.S. Employer
Incorporation or Organization)                               Identification No.)

15170 North Hayden Road, Suite 1, Scottsdale, AZ                    85260
  (Address of Principal Executive Offices)                        (Zip code)

                                 (602) 627-0200
                (Issuer's Telephone Number, Including Area Code)

                   (Former Name, Former Address and Former
                   Fiscal Year if Changed Since Last Report)

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
stock, as of the latest practicable date:

           Title of each class                Outstanding at April 12, 1999
           -------------------                -----------------------------
      Common Stock, par value $.001                 5,667,375 Shares

    Transitional Small Business Disclosure Format (Check One): Yes [ ] No [X]
<PAGE>
ITEM 1.
                     ROYAL PRECISION, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                             (dollars in thousands)

                                                       FEBRUARY 28,     MAY 31,
                                                          1999           1998
                                                        --------       --------
                             ASSETS                    (UNAUDITED)
CURRENT ASSETS:
  Cash                                                  $     21       $     28
  Accounts receivable, net of allowance for
   doubtful accounts of $473 at February 28, 1999
   and $602 at May 31, 1998                                3,077          4,042
  Inventories                                              5,226          4,049
  Current portion of net investment in capital lease         254            240
  Other current assets                                       368             74
  Deferred income taxes                                      265            265
                                                        --------       --------
    Total current assets                                   9,211          8,698
                                                        --------       --------
PROPERTY, PLANT AND EQUIPMENT:
  Land                                                       123            123
  Buildings and improvements                                 670            689
  Furniture, fixtures and office equipment                   455            544
  Machinery and equipment                                  3,513          3,894
                                                        --------       --------
                                                           4,761          5,250
  Less - Accumulated depreciation                           (823)          (754)
                                                        --------       --------
                                                           3,938          4,496
                                                        --------       --------
GOODWILL, net                                              9,637         10,028
                                                        --------       --------
NET INVESTMENT IN CAPITAL LEASE, 
 less current portion                                      2,381          2,593
                                                        --------       --------
OTHER ASSETS                                                  56             71
                                                        --------       --------
    Total assets                                        $ 25,223       $ 25,886
                                                        ========       ========
                      LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
  Lines-of-credit                                       $  3,977       $  3,462
  Current portion of long-term debt and capital
   lease obligations                                       1,519          1,047
  Accounts payable                                         1,853          1,769
  Accrued salaries and benefits                              667            760
  Other accrued expenses                                   1,648          1,259
                                                        --------       --------
    Total current liabilities                              9,664          8,297
                                                        --------       --------
LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS,
 less current portion                                      3,594          3,171
                                                        --------       --------
DEFERRED INCOME TAXES                                         46             46
                                                        --------       --------
OTHER LIABILITIES                                              1             45
                                                        --------       --------
    Total liabilities                                     13,305         11,559
                                                        --------       --------
STOCKHOLDERS' EQUITY:
  Preferred stock, $.001 par value; 5,000,000
   shares authorized; no shares issued                        --             --
  Common stock, $.001 par value; 50,000,000
   shares authorized; 5,667,375 and 5,601,697
   shares issued and outstanding at February 28, 1999
   and May 31, 1998, respectively                              6              6
  Additional paid-in capital                              13,853         13,821
  Retained earnings (deficit)                             (1,941)           500
                                                        --------       --------
    Total stockholders' equity                            11,918         14,327
                                                        --------       --------
    Total liabilities and stockholders' equity          $ 25,223       $ 25,886
                                                        ========       ========

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

                                      -2-
<PAGE>

                     ROYAL PRECISION, INC. AND SUBSIDIARIES
           CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
                (dollars in thousands, except per share amounts)
<TABLE>
<CAPTION>
                                                     THREE MONTHS ENDED           NINE MONTHS ENDED
                                                 -------------------------    -------------------------
                                                 FEBRUARY 28,  FEBRUARY 28,   FEBRUARY 28,  FEBRUARY 28,
                                                    1999          1998           1999          1998
                                                 ----------    ----------     ----------    ----------
<S>                                              <C>           <C>            <C>           <C>
NET SALES:
  Golf shafts                                    $    4,178    $    5,326     $   12,220    $   14,790
  Golf grips                                            940         1,093          2,787         2,391
                                                 ----------    ----------     ----------    ----------
                                                      5,118         6,419         15,007        17,181
                                                 ----------    ----------     ----------    ----------
COST OF SALES:
  Golf shafts                                         3,075         3,954          8,295        10,853
  Golf grips                                            589           686          1,566         1,029
                                                 ----------    ----------     ----------    ----------
                                                      3,664         4,640          9,861        11,882
                                                 ----------    ----------     ----------    ----------
    Gross profit                                      1,454         1,779          5,146         5,299

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES          1,615         1,930          4,997         4,700

MERGER RELATED EXPENSES                                 503            90            503           765
                                                 ----------    ----------     ----------    ----------
    Operating loss                                     (664)         (241)          (354)         (166)

INTEREST EXPENSE                                        206           163            595           430

OTHER INCOME                                            (74)          (56)          (199)         (113)
                                                 ----------    ----------     ----------    ----------
  Loss from continuing operations
   before income tax expense (benefit)                 (796)         (348)          (750)         (483)

INCOME TAX EXPENSE (BENEFIT)                             16          (184)           (39)         (361)
                                                 ----------    ----------     ----------    ----------
  Loss from continuing operations                      (812)         (164)          (711)         (122)

DISCONTINUED OPERATIONS:
  Loss from operations of Roxxi, Inc.                  (127)         (113)          (516)         (420)
  Provision for loss on disposal of
   assets of Roxxi, Inc.                             (1,214)           --         (1,214)           --
                                                 ----------    ----------     ----------    ----------
    Net loss                                     $   (2,153)   $     (277)    $   (2,441)   $     (542)
                                                 ==========    ==========     ==========    ==========
BASIC AND DILUTED LOSS FROM CONTINUING
 OPERATIONS PER COMMON SHARE                     $    (0.14)   $    (0.03)    $    (0.13)   $    (0.03)

BASIC AND DILUTED LOSS FROM OPERATIONS
 OF ROXXI, INC. PER COMMON SHARE                      (0.02)        (0.02)         (0.08)        (0.08)

BASIC AND DILUTED LOSS FROM PROVISION FOR LOSS
 ON DISPOSAL OF ROXXI, INC. PER COMMON SHARE          (0.22)           --          (0.22)           --
                                                 ----------    ----------     ----------    ----------

BASIC AND DILUTED NET LOSS PER COMMON SHARE      $    (0.38)   $    (0.05)    $    (0.43)   $    (0.11)
                                                 ==========    ==========     ==========    ==========
WEIGHTED AVERAGE NUMBER OF COMMON SHARES
 OUTSTANDING USED IN COMPUTING PER SHARE
 INFORMATION                                      5,667,375     5,596,914      5,643,818     5,127,624
                                                 ==========    ==========     ==========    ==========
</TABLE>
              The accompanying notes are an integral part of these
                  condensed consolidated financial statements.

                                      -3-
<PAGE>
                     ROYAL PRECISION, INC. AND SUBSIDIARIES
           CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
                             (dollars in thousands)

                                                        NINE MONTHS ENDED
                                                    --------------------------
                                                    FEBRUARY 28,    FEBRUARY 28,
                                                       1999             1998
                                                     --------        --------
CASH FLOWS FROM OPERATING ACTIVITIES:
  Net loss from continuing operations               $   (711)          $   (122)
  Adjustments to reconcile net loss from
   continuing operations to net cash (used in)
   provided by operating activities--
    Cash loss from operations of Roxxi, Inc.            (299)              (257)
    Depreciation and amortization                        703                574
    Loss on write-off of fixed assets, net                --                347
    Changes in operating assets and liabilities,
     net of effect of business acquired--
      Accounts receivable                                965                633
      Inventories                                     (1,682)               427
      Other assets                                       (47)               166
      Accounts payable and accrued expenses              399               (880)
      Supply agreement credits                            --               (472)
      Other liabilities                                  (44)                --
                                                    --------           --------
  Net cash (used in) provided by operating
   activities                                           (716)               416
                                                    --------           --------
CASH FLOWS FROM INVESTING ACTIVITIES:
  Cash acquired from Royal Grip, Inc.                     --                 18
  Payments from net investment in capital lease          198                 --
  Purchases of equipment, net                           (754)              (776)
  Merger costs                                          (162)            (1,032)
                                                    --------           --------
  Net cash used in investing activities                 (718)            (1,790)
                                                    --------           --------
CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from exercise of common stock
    warrants and options                                  17                 14
  Proceeds from issuance of long-term debt             5,140              1,000
  Borrowings under lines-of-credit, net                  515              1,075
  Repayments of long-term debt and capital
    lease obligations                                 (4,245)              (743)
                                                    --------           --------

  Net cash provided by financing activities            1,427              1,346
                                                    --------           --------
DECREASE IN CASH                                          (7)               (28)
CASH, beginning of period                                 28                 28
                                                    --------           --------
CASH, end of period                                 $     21           $     --
                                                    ========           ========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
  Cash paid during the period for --
    Interest                                        $    649           $    473
                                                    ========           ========
    Income taxes                                    $     82           $     60
                                                    ========           ========
  Non-cash transactions --
    Provision for loss on disposal of
     assets of Roxxi, Inc.                          $  1,214           $     --
                                                    ========           ========
    Issuance of common stock and options and
     warrants to purchase common stock for
     acquisition of Royal Grip, Inc.                $     --           $ 12,995
                                                    ========           ========

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

                                      -4-
<PAGE>
                     ROYAL PRECISION, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

1.     OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES:

       BASIS OF PRESENTATION --

       The condensed consolidated financial statements of Royal Precision,  Inc.
       and  subsidiaries  (collectively,  "RPI" or the  "Company")     presented
       herein have been  prepared  pursuant to the rules of the  Securities  and
       Exchange  Commission  for  quarterly  reports  on Form  10-QSB and do not
       include all of the information and note disclosures required by generally
       accepted accounting  principles.  These condensed  consolidated financial
       statements should be read in conjunction with the Company's  consolidated
       financial  statements  and notes  thereto for the year ended May 31, 1998
       included in the Company's Form 10-KSB. In the opinion of management,  the
       accompanying   unaudited  condensed   consolidated  financial  statements
       include all adjustments, consisting of only normal recurring adjustments,
       necessary to present fairly the consolidated financial position,  results
       of operations and cash flows of the Company.  Quarterly operating results
       are not necessarily  indicative of the results that would be expected for
       the full year.

       PRINCIPLES OF CONSOLIDATION --

       The accompanying  condensed  consolidated  financial  statements  include
       Royal  Precision,  Inc.  and  its  three  wholly-owned  subsidiaries,  FM
       Precision Golf Manufacturing Corp. ("FMP"), FM Precision Golf Sales Corp.
       ("FM Sales") and Royal Grip, Inc. (formerly FMPSUB,  Inc.) and its wholly
       owned subsidiary,  Roxxi, Inc.  (collectively "RG"). On May 14, 1997, RPI
       entered into an Agreement  and Plan of Merger with RG. Under the terms of
       the Merger agreement,  effective August 29, 1997, FMPSUB,  Inc. (a wholly
       owned subsidiary of RPI created for such purpose) merged with and into RG
       (the "FMP-RG  Merger").  RG was the  surviving  corporation  and became a
       wholly owned subsidiary of RPI. Accordingly, the results of operations of
       RPI for all periods  presented  exclude the results of  operations  of RG
       prior to August 29,  1997.  All  significant  intercompany  balances  and
       transactions have been eliminated in consolidation. As discussed in Notes
       7 and 8, the Company has entered  into an  agreement to merge with Coyote
       Sports,  Inc. and has  disposed of the  operating  assets of Roxxi,  Inc.
       ("Roxxi").

       REPORTING PERIODS --

       The  Company's  first three fiscal  quarters in the fiscal year ended May
       31, 1998 ended on a Saturday.  The Company's  first three fiscal quarters
       in the fiscal year ending May 31,  1999 end on the last  calendar  day of
       the quarter. The Company's year-end is May 31.

2.     NET LOSS PER SHARE:

       Basic earnings per common share are based on the average number of common
       shares outstanding during the periods presented. Common share equivalents
       of  approximately  150,000 shares during the three and nine month periods
       ended February 28, 1999 and approximately 170,000 shares during the three
       and nine month periods ended February 28, 1998 were  antidilutive  in all
       periods presented and are excluded from diluted earnings per share.

3.     NEW ACCOUNTING STANDARD:

       In June 1998,  the FASB issued SFAS No. 133,  "Accounting  for Derivative
       Instruments  and  Hedging  Activities",  which  requires  that an  entity
       recognize  all  derivatives  as  either  assets  or  liabilities  in  the
       statement of financial  position and measure  those  instruments  at fair
       value.  The Company  will be required to adopt SFAS No. 133 as of June 1,
       2000 and does not  anticipate  any  material  impact  resulting  from the
       adoption of this pronouncement.

                                      -5-
<PAGE>
4.     INVENTORIES:

       Inventories  as of February  28, 1999 and May 31, 1998  consisted  of the
       following (in thousands):

                                          FEBRUARY 28, 1999     MAY 31, 1998
                                          -----------------     ------------

       Raw materials                           $  525              $1,161
       Work-in-process                          1,979               1,206
       Finished goods                           2,722               1,682
                                               ------              ------

                                               $5,226              $4,049
                                               ======              ======
5.     INFORMATION ON SEGMENTS:

       The Company has two reportable  segments  within  continuing  operations:
       golf club  shafts and golf club  grips.  The  accounting  policies of the
       segments are the same as those  described  in the summary of  significant
       accounting policies in Form 10-KSB. The Company evaluates the performance
       of these segments based on segment profit or loss after income taxes. The
       Company  allocates  certain  administrative  expenses  to  segments.  The
       amounts in this illustration are the amounts in reports used by the chief
       operating officer as of February 28, 1999 (in thousands):

                                           THREE MONTHS ENDED FEBRUARY 28, 1999
                                           ------------------------------------
                                               GOLF        GOLF
                                              SHAFTS       GRIPS       TOTAL
                                              ------       -----       -----
       Revenues from external customers      $  4,178    $    940    $  5,118
       Segment profit (loss)                     (709)       (103)       (812)
       Segment assets                          10,752      11,417      22,169

       Total assets for reportable segments                          $ 22,169
       Assets of discontinued operation                                   630
       Elimination of investment in
         subsidiaries                                                  (7,213)
       Goodwill not allocated to segments                               9,637
                                                                     --------
       Consolidated total assets                                     $ 25,223
                                                                     ========

                                           THREE MONTHS ENDED FEBRUARY 28, 1998
                                           ------------------------------------
                                               GOLF        GOLF
                                              SHAFTS       GRIPS       TOTAL
                                              ------       -----       -----
       Revenues from external customers      $  5,326    $  1,093    $  6,419
       Segment profit (loss)                     (167)          3        (164)
       Segment assets                           9,179      11,821      21,000

       Total assets for reportable segments                          $ 21,000
       Assets of discontinued operation                                 2,147
       Elimination of investment in
         subsidiaries                                                  (7,768)
       Goodwill not allocated to segments                              10,158
                                                                     --------
       Consolidated total assets                                     $ 25,537
                                                                     ========
                                      -6-
<PAGE>
                                             NINE MONTHS ENDED FEBRUARY 28, 1999
                                             -----------------------------------
                                                GOLF        GOLF
                                               SHAFTS       GRIPS       TOTAL
                                               ------       -----       -----
       Revenues from external customers       $ 12,220    $  2,787    $ 15,007
       Segment profit (loss)                      (730)         19        (711)
       Segment assets                           10,752      11,417      22,169

       Total assets for reportable segments                           $ 22,169
       Assets of discontinued operation                                    630
       Elimination of investment in
         subsidiaries                                                   (7,213)
       Goodwill not allocated to segments                                9,637
                                                                      --------
       Consolidated total assets                                      $ 25,223
                                                                      ========

                                             NINE MONTHS ENDED FEBRUARY 28, 1998
                                             -----------------------------------
                                                GOLF        GOLF
                                               SHAFTS       GRIPS        TOTAL
                                               ------       -----        -----
       Revenues from external customers       $ 14,790    $  2,391    $ 17,181
       Segment profit (loss)                      (481)        359        (122)
       Segment assets                            9,179      11,821      21,000

       Total assets for reportable segments                           $ 21,000
       Assets of discontinued operation                                  2,147
       Elimination of investment in
         subsidiaries                                                   (7,768)
       Goodwill not allocated to segments                               10,158
                                                                      --------
       Consolidated total assets                                      $ 25,537
                                                                      ========
6.     BORROWING ARRANGEMENTS:

       On October 9, 1998, FMP entered into a new credit facility and RG amended
       its existing  borrowing  arrangement.  In connection  with the new credit
       facility  for FMP,  all loans to FMP were paid off and a new  credit  and
       security  agreement was entered into with RG's lender. In connection with
       the  repayment  of the  amounts  outstanding  under  the old  FMP  credit
       facility,  FMP paid a $75,000  prepayment penalty which is reflected as a
       component of interest expense in the second quarter of fiscal 1999. Terms
       of FMP's new credit  facility are as follows.  The amount  available  for
       borrowings  under  the FMP term loan is $4.3  million.  Such  amount  was
       funded on October 9,  1998.  FMP's term loan is due in monthly  principal
       installments  of $99,000  through  and until  October 1, 1999 and $65,000
       monthly,  thereafter until the maturity of the loan. The amount available
       for borrowings under the FMP revolving  line-of-credit  is based upon the
       levels of  eligible  accounts  receivable  and  inventories,  as defined,
       subject to maximum borrowing of $4.0 million.

       The borrowing arrangement with RG was amended and restated. The amendment
       resulted  in the  funding of a new RG term loan of $840,000 on October 9,
       1998  in  addition  to the  existing  RG  term  loan  that  had  $472,000
       outstanding  at  October  9,  1998.  RG's term  loans are due in  monthly
       principal  installments  of $40,000 through and until October 1, 1999 and
       $22,500  monthly,  thereafter  until the maturity of the loan. The amount
       available for borrowings under the RG revolving  line-of-credit  is based
       upon the levels of  eligible  accounts  receivable  and  inventories,  as
       defined, subject to maximum borrowing of $1.5 million.

       Effective  January  1,  1999,  borrowings  under all term  loans and both
       revolving  lines-of-credit bear interest at a rate per annum equal to the
       prime  rate  (7.75%  at  February   28,   1999)  plus  2.75%  and  2.25%,
       respectively,  and are  secured  by  substantially  all of the  Company's
       assets.  The  maturity  date  for  all  term  loans  and  both  revolving
       lines-of-credit  is September 30, 2001. On February 28, 1999, the Company
       had  $3,977,000  outstanding  under  the  revolving  lines-of-credit  and
       $949,000 available for additional borrowings.

       Primarily  as a result  of  merger-related  expenses  of  $503,000  and a
       provision  of  approximately  $1.2  million  for the  loss on the sale of
       Roxxi, the Company defaulted on certain bank covenants during the quarter

                                      -7-
<PAGE>
       ended February 28, 1999. The violation of these covenants has been waived
       by the lender.  In connection  with  granting the waivers,  the Company's
       lender  increased the Company's  borrowing rate by 2% per annum effective
       January 1, 1999.

       The  Company's  lender  modified its  covenants  for the remainder of the
       fiscal year ending May 31, 1999. The required debt service coverage ratio
       has been waived  through May 31, 1999 and the maximum  monthly  allowable
       net loss has been  reduced from  breakeven  to an  aggregate  net loss of
       $150,000 for the months of March, April and May of 1999. In addition, the
       minimum annual net income  requirement for the fiscal year ending May 31,
       1999 has  been  reduced  from net  income  of  $400,000  to a net loss of
       $500,000. The modified covenants exclude all merger-related  expenses and
       the provision for the loss associated with the disposition of Roxxi.

7.     DISCONTINUED OPERATION:

       During March 1999, the Company  disposed of the operating assets of Roxxi
       through two  transactions  with unrelated  parties.  In one  transaction,
       Roxxi sold its trade name,  customer  list,  design  database and related
       computer  software and  hardware.  In return,  the Company will receive a
       royalty of 16% of the buyer's net sales for the two-year period beginning
       May  1,  1999.  In  the  second  transaction,  Roxxi  sold  its  headwear
       manufacturing  equipment,  headwear  inventory and raw  materials.  Roxxi
       received $300,000 at closing and the Company will receive a royalty of 2%
       of the buyer's net sales until the buyer has paid an additional $200,000.

       In the fiscal  quarter ended  February 28, 1999,  the Company  recorded a
       loss provision of  approximately  $1.2 million on the  disposition of the
       Roxxi assets. This amount reflects a $1,059,000  write-down of the excess
       book value of inventory  and fixed  assets over the cash  received in the
       sale, the establishment of a reserve totaling $80,000 for estimated costs
       associated  with the  transaction,  and $75,000 for  estimated  operating
       losses to be  incurred  during  the  phase-out  period  of this  business
       segment.  The Company  will  account for royalty fees as income in future
       periods as payments are received from the two buyers.

       During the three months ended February 28, 1999 and 1998,  Roxxi recorded
       net sales of $0.5 million and $0.8 million, respectively. During the nine
       months ended February 28, 1999 and 1998, Roxxi recorded net sales of $1.9
       million and $1.8  million,  respectively.  The net  operating  results of
       Roxxi are  segregated  from  income  from  continuing  operations  in the
       condensed  consolidated  statements  of  operations  and are reflected as
       discontinued operations for all periods presented.  Included in the Roxxi
       operating  losses of $127,000 and  $113,000  for the three month  periods
       ended February 28, 1999 and 1998 are depreciation  expense of $72,000 and
       $80,000,  respectively.  Included in the Roxxi  operating  losses of $0.5
       million and $0.4 million for the nine month  periods  ended  February 28,
       1999  and  1998  are  depreciation  expense  of  $217,000  and  $163,000,
       respectively.   As  of  February  28,  1999,  the  remaining  assets  and
       liabilities of Roxxi include net accounts receivable of $300,000,  assets
       held for sale at a value of $300,000  (included in other current  assets)
       and accounts payable and accrued expenses totaling $290,000.

8.     MERGER:

       On February  2, 1999,  the Company  and Coyote  Sports,  Inc.  ("Coyote")
       entered  into a merger  agreement.  Pursuant  to the terms of the  merger
       agreement,  Coyote will be the surviving  publicly-traded company and RPI
       will  become  a  wholly  owned  subsidiary  of  Coyote  (the  "RPI-Coyote
       Merger").  Coyote,  along  with  its  subsidiaries,  designs,  engineers,
       manufactures,  markets and  distributes  brand name sports  equipment and
       recreational  products including steel and graphite golf shafts,  premium
       grade cycle  tubing and  javelins  and also  produces  graphite and other
       advanced composite  materials for use in the production of sporting goods
       products.  The  RPI-Coyote  Merger must be approved by both the Company's
       stockholders and Coyote's  stockholders and is contingent upon conditions
       which must be fulfilled prior to consummation of the  transaction.  These
       conditions  include  the filing of a  registration  statement,  obtaining
       adequate financing and various other obligations identified in the merger
       agreement.  Management believes the RPI-Coyote Merger will be consummated
       in  the  second  calendar  quarter  of  1999.  However,  there  can be no
       assurance  that the  RPI-Coyote  Merger will be  consummated.  During the
       third fiscal quarter ended February 28, 1999, the Company  incurred costs
       totaling  $503,000  related  to the  RPI-Coyote  Merger  which  have been
       reflected  as  Merger  Related  Expenses  in the  accompanying  financial
       statements.

                                      -8-
<PAGE>
9.     TERMINATION OF ACUSHNET SUPPLY AGREEMENT:

       During  March 1999,  RG received a letter from  Acushnet  Rubber  Company
       ("Acushnet")  terminating  the  Manufacturing  and Supply  Agreement  and
       Capital Lease Agreement. In the notice of termination, Acushnet agreed to
       pay RG a $2.5  million  termination  fee  at  the  end of the  transition
       period,  to  continue  to  produce  grips for ten months and to pay up to
       $100,000 for shipping and installing the manufacturing equipment at a new
       location.  In  connection  with  the  termination,  RG will  receive  the
       manufacturing equipment and Acushnet's obligation under the capital lease
       will be terminated. At February 28, 1999, the Company's capital equipment
       lease receivable was approximately $2.6 million.  Also in the termination
       letter,  Acushnet  stated  that it would not  continue  paying  the lease
       payments. The Company has not responded to Acushnet's termination letter;
       however,   the  Company  and  legal  counsel   believe  that   Acushnet's
       interpretation  of  the  clause  in the  contract  related  to the  lease
       payments is without  merit and the Company  will pursue its rights  under
       the contract to receive lease payments throughout the transition period.

       RG currently  has no back-up  source of supply;  however,  the Company is
       currently in discussions  with a number of grip  manufacturers  which the
       Company  believes can maintain RG's standard of product  quality and will
       facilitate  a smooth  transition.  There  can be no  assurances  that the
       Company will be able to secure a source for grips on as  favorable  terms
       or with the same or better quality as Acushnet. In addition, there can be
       no  assurances  that a transition  to a new  supplier  will not result in
       production  delays,  the  loss of sales  and key  customers  which  would
       materially affect RG's financial condition and results of operations.

                                      -9-
<PAGE>
ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS

FORWARD LOOKING STATEMENTS --

The Private  Securities  Litigation  Reform Act of 1995 provides a "safe harbor"
for forward-looking statements. The Company believes it has made forward-looking
statements  within the meaning of the Litigation Reform Act in this Form 10-QSB,
other  Forms  10-QSB,  Forms  10-KSB,  Forms  8-K,  and  other  written  or oral
statements  made by or on behalf of RPI which  reflect  RPI's current views with
respect  to future  events  and  financial  performance.  These  forward-looking
statements  are subject to certain  uncertainties  and other  factors that could
cause  actual  results  to  differ   materially  from  such  statements.   These
uncertainties and other factors include,  but are not limited to,  uncertainties
relating to international,  national,  and local economic  conditions,  customer
plans and commitments,  RPI's cost of raw materials, the competitive environment
in which RPI operates,  and changes in the financial  markets  relating to RPI's
capital structure and cost of capital. Statements in this Form 10-QSB, including
the Notes to the Condensed  Consolidated  Financial  Statements and Management's
Discussion  and  Analysis of  Financial  Condition  and  Results of  Operations,
describe  factors  among  others,   that  could  contribute  to  or  cause  such
differences.  Additional  factors  that  could  cause  actual  results to differ
materially from those expressed in such forward looking  statements are detailed
in RPI's  Form  10-KSB.  Please  refer  to "Risk  Factors"  therein.  The  words
"believe," "expect,"  "anticipate,"  "project," and similar expressions identify
forward  looking  statements,  which speak only as of the date the statement was
made.

OVERVIEW --

Royal  Precision,  Inc. ("RPI" or the "Company") is a holding company with three
wholly-owned  subsidiaries  which  are FM  Precision  Golf  Manufacturing  Corp.
("FMP"), FM Precision Golf Sales Corp. ("FM Sales"),  Royal Grip, Inc. (formerly
known  as  FMPSUB,   Inc.)  and  its  wholly  owned   subsidiary,   Roxxi,  Inc.
(collectively  "RG").  RPI  acquired  RG on August 29, 1997 by means of a merger
whereby  FMPSUB,  Inc.  merged  with  and into RG with RG  being  the  surviving
corporation.  The  effective  date of the FMP-RG  Merger  was  August 29,  1997.
Accordingly,  the results of operations of RPI for all periods presented exclude
the results of  operations of RG prior to August 29, 1997. As discussed in Notes
7 and 8 to the  condensed  consolidated  financial  statements,  the Company has
entered into an agreement to merge with Coyote Sports,  Inc. and has disposed of
the operating assets of Roxxi, Inc. ("Roxxi").

FMP is a  manufacturer  and  distributor  of golf club  shafts  that are sold to
original equipment  manufacturers ("OEMs") and to distributors and retailers for
use in the replacement market. The majority of FMP's sales are to OEMs. FMP also
sells golf shafts in foreign markets including Japan, Canada,  Australia and the
United Kingdom.  RG designs and distributes  golf club grips.  RG's products are
sold primarily  throughout the United States,  Japan and the United Kingdom. The
majority of RG's grip sales are to its Japanese  distributor.  In December 1996,
RG  outsourced  the  manufacturing  of its  non-cord  grips to  Acushnet  Rubber
Company.

The  Company's  business  experiences  the impact of  seasonality  with stronger
demand for products during the quarters ending in February and May.

THREE MONTHS ENDED FEBRUARY 28, 1999 COMPARED TO THE THREE MONTHS ENDED
FEBRUARY 28, 1998 -

NET SALES.  Net sales for the three  months  ended  February  28, 1999 were $5.1
million,  a decrease of 20% from net sales of $6.4 million for the corresponding
period  in  1998.  The  decrease  in net  sales  of $1.3  million  is  primarily
attributable  to a reduction in sales of the Company's  lower priced  commercial
grade  golf club  shafts of $1.9  million  or 87%.  Sales of this  product  were
significantly  reduced  following a price increase  instituted by the Company in
the first quarter of fiscal 1999. In response to these unfavorable  results, the
Company has  modified its pricing  structure  in an effort to increase  sales of
this product in future periods. Net sales of the Company's other golf club shaft
lines  increased by $0.8 million or 25%. Net sales of golf club grips  decreased
by $0.2  million or 14%  primarily as a result of  decreased  business  with two
significant OEM customers which accounted for $112,000 in sales during the three
months ended February 28, 1998 compared to $15,000 during the comparable  period
in 1999.

COST OF GOODS SOLD.  Cost of goods sold for the three months ended  February 28,
1999 was $3.7 million, a decrease of 21% from cost of goods sold of $4.6 million
for the same period in 1998.  The decrease in cost of goods sold of $1.0 million
is primarily  attributable to the decline in sales of commercial grade golf club
shafts  discussed  above.  Total golf club shaft cost of goods sold decreased by
$0.9  million.  Golf club grips  cost of sales  decreased  by $0.1  million as a
result of lower sales.

                                      -10-
<PAGE>
GROSS PROFIT. Gross profit for the three months ended February 28, 1999 was $1.5
million, a decrease of $0.3 million or 18% from gross profit of $1.8 million for
the  corresponding  period in 1998. This represents a decline in gross profit on
sales of golf club shafts  which  decreased by $0.3 million or 20% for the three
months  ended  February 28, 1999 as compared to the same period last year due to
lower sales. As a percentage of sales, the gross profit on shaft sales increased
from  25.8% to 26.4% due to a change  in the mix of  products  sold  from  lower
margin commercial grade shafts to higher margin Rifle shafts.

SELLING,   GENERAL   AND   ADMINISTRATIVE   EXPENSES.   Selling,   general   and
administrative  expenses for the three months ended  February 28, 1999 were $1.6
million, a decrease of 16% from selling,  general and administrative expenses of
$1.9 million for the same period in 1998.  The decrease in selling,  general and
administrative expenses of $0.3 million is primarily attributable to a reduction
in marketing and advertising costs of $0.2 million.

MERGER RELATED EXPENSES.  In conjunction with the pending RPI-Coyote Merger, the
Company  incurred  expenses  totaling $0.5 million during the three months ended
February  28,  1999.  In  conjunction  with the August 29, 1997  FMP-RG  Merger,
expenses of $0.1 million were  incurred  during the three months ended  February
28, 1998.

INTEREST EXPENSE.  Interest expense for the three months ended February 28, 1999
was $206,000 compared to $163,000 for the same period last year. The increase in
interest  expense is primarily  attributable  to the higher  effective  interest
rates in effect during the three months ended  February 28, 1999  resulting from
defaults on certain  bank  covenants  as  discussed  in Note 6 to the  condensed
consolidated financial statements.

OTHER INCOME.  Other income for the three-month  periods ended February 28, 1999
and 1998 is consistent at $74,000 and $56,000, respectively.

INCOME  TAXES.  Income tax expense of $16,000 and a benefit from income taxes of
$184,000 were recorded for the  three-month  periods ended February 28, 1999 and
1998, respectively. Taxes are provided based on the estimated effective tax rate
for the year which considers the effect of nondeductible  goodwill  amortization
and the inability to carry-back RG losses to periods prior to the FMP-RG Merger.

LOSS FROM OPERATIONS OF ROXXI,  INC. The losses from the operations of Roxxi for
the  three-month  periods  ended  February 28, 1999 and 1998 are  consistent  at
$127,000  and  $113,000,  respectively.  No income tax benefit was  provided for
these losses due to NOL carry-back limitations.

PROVISION  FOR LOSS ON DISPOSAL OF ASSETS OF ROXXI,  INC. As discussed in Note 7
to the condensed consolidated financial statements, a loss of approximately $1.2
million was recorded  during the  three-month  period ended February 28, 1999 to
provide  for the loss on  disposition  of the  assets  of Roxxi.  No income  tax
benefit was provided for this loss due to NOL carry-back limitations.

NINE MONTHS ENDED FEBRUARY 28, 1999 COMPARED TO THE NINE MONTHS ENDED
FEBRUARY 28, 1998 -

NET SALES.  Net sales for the nine  months  ended  February  28, 1999 were $15.0
million, a decrease of 13% from net sales of $17.2 million for the corresponding
period  in  1998.  The  decrease  in net  sales  of $2.2  million  is  primarily
attributable  to a reduction in sales of the Company's  lower priced  commercial
grade  golf club  shafts of $4.4  million  or 68%.  Sales of this  product  were
significantly  reduced  following a price increase  instituted by the Company in
the first quarter of fiscal 1999. In response to these unfavorable  results, the
Company has  modified its pricing  structure  in an effort to increase  sales of
this product in future periods. Net sales of the Company's other golf club shaft
lines  increased by $1.8 million or 21%. Net sales of golf club grips  increased
by $0.4 million or 17% primarily due to the inclusion of RG golf club grip sales
of $1.0 million  during the three month period ended August 31, 1998 compared to
$0 during the comparable period of 1997 which was prior to the effective date of
the FMP-RG Merger.

COST OF GOODS SOLD.  Cost of goods sold for the nine months  ended  February 28,
1999 was $9.9  million,  a  decrease  of 17%  from  cost of goods  sold of $11.9
million for the same period in 1998.  The decrease in cost of goods sold of $2.0
million is primarily  attributable  to the decline in sales of commercial  grade
golf club  shafts  discussed  above.  Total  golf club  shaft cost of goods sold
decreased by $2.6 million.  Golf club grips cost of goods sold increased by $0.5

                                      -11-
<PAGE>
million  primarily  due to the inclusion of RG golf club grip cost of goods sold
of $0.5 million  during the three month period ended August 31, 1998 compared to
$0 during the comparable period of 1997 which was prior to the effective date of
the FMP-RG Merger.

GROSS PROFIT.  Gross profit for the nine months ended February 28, 1999 was $5.1
million,   a  decrease  of  3%  from  gross  profit  of  $5.3  million  for  the
corresponding  period in 1998.  The  decrease in gross profit of $0.2 million is
primarily  attributable  to a $0.5  million  credit  received  from  Acushnet as
compensation  for delays and shortfalls in the production of golf club grips for
the Company  which was recorded as a one-time  reduction in golf club grips cost
of sales during the second quarter of fiscal 1998. As a percentage of sales, the
gross profit on shaft sales has increased from 26.6% to 32.1% due to a change in
the mix of products  sold from lower  margin  commercial  grade shafts to higher
margin Rifle shafts.

SELLING,   GENERAL   AND   ADMINISTRATIVE   EXPENSES.   Selling,   general   and
administrative  expenses for the nine months  ended  February 28, 1999 were $5.0
million, an increase of 6% from selling,  general and administrative expenses of
$4.7 million for the same period in 1998.  The increase in selling,  general and
administrative  expenses  of  $0.3  million  is  primarily  attributable  to the
inclusion of $0.5 million of selling,  general and administrative  expenses from
RG for the three month period  ended  August 31, 1998  compared to $0 during the
comparable  period of 1997 which was prior to the  effective  date of the FMP-RG
Merger.

MERGER RELATED EXPENSES.  In conjunction with the pending RPI-Coyote Merger, the
Company  incurred  expenses  totaling $0.5 million  during the nine months ended
February  28,  1999.  In  conjunction  with the August 29,  1997 FMP-RG  Merger,
expenses of $0.8 million were incurred during the nine months ended February 28,
1998.

INTEREST  EXPENSE.  Interest expense for the nine months ended February 28, 1999
was $595,000 compared to $430,000 for the same period last year. The increase in
interest  expense is primarily  attributable  to a $75,000 loan  prepayment  fee
incurred on October 9, 1998 upon funding of the new credit facilities  discussed
in Note 6 to the condensed consolidated financial statements.  Additionally,  RG
interest  expense  totaled  $36,000 for three month period ended August 31, 1998
compared  to $0 during  the  comparable  period  of 1997  which was prior to the
effective date of the FMP-RG Merger.

OTHER  INCOME.  Other  income for the nine months  ended  February  28, 1999 was
$199,000,  compared to $113,000 for the same period last year.  This increase is
due to the  inclusion  of interest  income of $54,000  from RG's  capital  lease
receivable  for three month period  ended August 31, 1998  compared to $0 during
the  comparable  period of 1997  which was  prior to the  effective  date of the
FMP-RG Merger.

INCOME  TAXES.  A benefit from income taxes of $39,000 and $361,000 was recorded
for the nine-month periods ended February 28, 1999 and 1998, respectively. Taxes
are  provided  based on the  estimated  effective  tax  rate for the year  which
considers the effect of nondeductible goodwill amortization and the inability to
carry-back RG losses to periods prior to the FMP-RG Merger.

LOSS FROM OPERATIONS OF ROXXI,  INC. The losses from the operations of Roxxi for
the  nine-month  periods  ended  February  28,  1999 and 1998 are  $516,000  and
$420,000,  respectively. The increase is primarily due to the inclusion of Roxxi
operating  losses of  $190,000  for three  month  period  ended  August 31, 1998
compared  to $0 during  the  comparable  period  of 1997  which was prior to the
effective  date of the FMP-RG  Merger.  No income tax benefit was  provided  for
these losses due to NOL carry-back limitations.

PROVISION  FOR LOSS ON DISPOSAL OF ASSETS OF ROXXI,  INC. As discussed in Note 7
to the condensed consolidated financial statements, a loss of approximately $1.2
million was recorded  during the  nine-month  period ended  February 28, 1999 to
provide  for the loss on  disposition  of the  assets  of Roxxi.  No income  tax
benefit was provided for this loss due to NOL carry-back limitations.

LIQUIDITY AND CAPITAL RESOURCES.  At February 28, 1999, RPI had negative working
capital of  $453,000  and a current  ratio of 0.95 to 1 as  compared  to working
capital of $401,000 and a current ratio of 1.05 to 1 at May 31, 1998. On October
9, 1998,  FMP entered into a new credit  facility  and RG amended  its  existing
borrowing  arrangement.  As a result,  all of the Company's bank  facilities are
consolidated  with one lender.  The Company  believes that its existing  capital
resources and credit lines  available are  sufficient to fund its operations and
capital requirements as presently planned over the next twelve months.

                                      -12-
<PAGE>
In connection  with the new credit  facility for FMP, all loans to FMP were paid
off and a new credit and security  agreement  was entered into with RG's lender.
In connection  with the repayment of the amounts  outstanding  under the old FMP
credit facility,  FMP paid a $75,000  prepayment penalty which is reflected as a
component of interest  expense in the second  quarter of fiscal  1999.  Terms of
FMP's new credit  facility are as follows.  The amount  available for borrowings
under the FMP term loan is $4.3  million.  Such  amount was funded on October 9,
1998.  FMP's  term loan is due in  monthly  principal  installments  of  $99,000
through and until  October 1, 1999 and  $65,000  monthly,  thereafter  until the
maturity  of the  loan.  The  amount  available  for  borrowings  under  the FMP
revolving   line-of-credit  is  based  upon  the  levels  of  eligible  accounts
receivable and  inventories,  as defined,  subject to maximum  borrowing of $4.0
million.

The  borrowing  arrangement  with RG was amended  and  restated.  The  amendment
resulted  in the funding of a new RG term loan of $840,000 on October 9, 1998 in
addition to the existing RG term loan that had $472,000  outstanding  at October
9, 1998.  RG's term loans are due in monthly  principal  installments of $40,000
through and until  October 1, 1999 and  $22,500  monthly,  thereafter  until the
maturity of the loan. The amount available for borrowings under the RG revolving
line-of-credit  is based upon the levels of  eligible  accounts  receivable  and
inventories, as defined, subject to maximum borrowing of $1.5 million.

Effective  January 1, 1999,  borrowings  under all term loans and both revolving
lines-of-credit bear interest at a rate per annum equal to the prime rate (7.75%
at February  28,  1999) plus 2.75% and 2.25%,  respectively,  and are secured by
substantially all of the Company's assets.  The maturity date for all term loans
and both revolving  lines-of-credit is September 30, 2001. On February 28, 1999,
the Company had $3,977,000  outstanding under the revolving  lines-of-credit and
$949,000 available for additional borrowings.

Primarily as a result of merger-related  expenses of $503,000 and a provision of
approximately  $1.2  million  for the loss on the  sale of  Roxxi,  the  Company
defaulted on certain bank covenants  during the quarter ended February 28, 1999.
The violation of these  covenants  has been waived by the lender.  In connection
with  granting  the  waivers,  the  Company's  lender  increased  the  Company's
borrowing rate by 2% per annum effective January 1, 1999.

The Company's lender modified its covenants for the remainder of the fiscal year
ending May 31, 1999.  The required debt service  coverage  ratio has been waived
through May 31, 1999 and the maximum monthly allowable net loss has been reduced
from  breakeven  to an  aggregate  net loss of $150,000 for the months of March,
April and May of 1999. In addition,  the minimum  annual net income  requirement
for the fiscal  year  ending May 31,  1999 has been  reduced  from net income of
$400,000  to a  net  loss  of  $500,000.  The  modified  covenants  exclude  all
merger-related  expenses  and the  provision  for the loss  associated  with the
disposition of Roxxi.

During the nine months  ended  February  28,  1999,  net cash used in  operating
activities  was $0.7  million  which  primarily  resulted  from a net loss  from
continuing  operations of $0.7 million,  a cash loss from operations of Roxxi of
$0.3 million and an increase in inventories of $1.7 million offset by a decrease
in accounts  receivable  of $1.0  million,  an increase in accounts  payable and
accrued   expenses  of  $0.4  million  and  $0.7  million  of  depreciation  and
amortization.  The Company used $0.7 million in investing  activities during the
nine months ended  February 28, 1999,  primarily  for the purchase of additional
property,  plant and equipment.  The Company estimates that capital expenditures
for the fiscal year ended May 31, 1999 will be approximately $1.2 million.

Net cash provided by financing activities for the nine months ended February 28,
1999,  was $1.4 million  resulting from issuance of long term debt totaling $5.1
million  and $0.5  million of net  borrowings  under  lines of credit  partially
offset by repayments of $4.2 million on the Company's term loans.

YEAR 2000  ASSESSMENT.  The  following  Year 2000  discussion  contains  various
forward-looking  statements that represent the Company's beliefs or expectations
regarding  future  events.  When  used in the Year  2000  discussion,  the words
"believe", "expects",  "estimates" and other similar expressions are intended to
identify forward-looking statements. Forward-looking statements include, without
limitation,  the  Company's  expectations  as to  when  it and  its  significant
distributors,  customers and  suppliers  will  complete the  implementation  and
compliance  phases of the Year 2000 Plan,  as well as its Year 2000  contingency
plans; and the Company's belief that its internal systems and equipment are Year
2000 compliant.  All  forward-looking  statements  involve a number of risks and
uncertainties  that could cause the actual results to differ materially from the
projected results. Factors that may cause these differences include, but are not
limited  to, the  availability  of  qualified  personnel  and other  information
technology resources; the ability to identify

                                      -13-
<PAGE>
and rectify all date  sensitive  lines of code or to replace  embedded  chips in
affected  systems or  equipment;  unanticipated  delays or  expenses  related to
correction of the problems;  and the actions of independent  third-parties  with
respect to Year 2000 problems.  The statements in the following  section include
"Year 2000 Readiness Disclosure" within the meaning of the Year 2000 Information
and Readiness Disclosure Act of 1998.

The Year 2000  problem  refers to the  inability  of  software  to process  date
information  later than December 31, 1999. Date codes in many software  programs
are  abbreviated  to  allow  only  two  digits  for  the  year.   Software  with
date-sensitive  functions  that is not Year  2000  compliant  may not be able to
distinguish  whether "00" means 1900 or 2000.  When that happens,  some software
will not work at all and other  software will suffer  critical  calculation  and
other  processing  errors.  Hardware and other  products with embedded chips may
also experience problems.

The Company believes that its critical  internal systems  including  versions of
Macola, ADP, Oracle,  Microsoft  Exchange,  and Microsoft Office 97 products are
Year 2000  compliant.  In addition,  the Company  tracks the version and updates
available for these products to ensure Year 2000 compliance.

The Company has completed a comprehensive evaluation of its internal systems and
equipment  that  addresses  both  information  technology  systems  ("IT") (i.e.
business systems and the software  development  environment) and non-IT systems,
(i.e.  elevators,  building  security  and  HVAC  systems)  including  hardware,
software and  firmware.  In addition,  the Company has  completed the upgrade of
certain  critical  systems  to meet  with  Year 2000  requirements.  During  the
previous  two-year period,  the Company has expended  approximately  $100,000 to
purchase and install new computer hardware and software resulting in all Company
hardware and software used for accounting  purposes  being Year 2000  compliant.
Expenses  associated with evaluation of the Company's  internal systems for Year
2000 problems have been approximately  $20,000.  The final phase of the internal
Year 2000 project has been completed with the conversion of the E-mail system to
Microsoft  Exchange at a cost of $10,000.  The Company  believes that any future
internal Year 2000 costs will be immaterial.

Due to the  Company's  extensive  internal  Year 2000  analysis  and  subsequent
completion of the Year 2000 project, the Company has determined that an internal
contingency  plan  is  unnecessary.  The  Company  also  is in  the  process  of
conducting a review of its suppliers to determine that the suppliers' operations
and the products and services they provide are Year 2000 compliant.  The Company
has already  contacted its critical  suppliers and utility providers for each of
its business units.  All significant  suppliers and utilities  except one of the
Company's golf grip suppliers have indicated that their products and company are
Year 2000  compliant.  The  primary  supplier  of the  Company's  golf  grips is
currently in the process of converting, upgrading, and correcting all known Year
2000  problems.  This  supplier  is in the last phase of its plan to correct the
Year 2000 problems and has indicated  that the project will be completed  during
the second  calendar  quarter of 1999.  The  Company is closely  monitoring  the
status of this project and is assisting in its implementation.

The Company has no practical means to verify the  information  provided by these
independent third parties and is still pursuing those secondary distributors and
vendors who may not yet have  responded.  Based upon this  assessment  and where
practicable,  the Company will attempt to mitigate its risks with respect to any
suppliers  that may not meet the  requirements,  including  seeking  alternative
suppliers.  However,  there  can be no  assurance  that  the  Company  will  not
experience  disruptions in its ability to conduct  business because of Year 2000
problems  experienced by the Company's  distributors  or vendors,  such problems
remain a possibility  and could have an adverse impact on the Company's  results
of operations and financial  condition.  To the extent that its key distributors
or vendors experience  problems relative to achieving Year 2000 compliance,  the
Company could suffer unanticipated revenue losses.

Some  independent  sales   representatives   that  the  Company  uses  may  have
applications that are not Year 2000 compliant. The Company does not believe this
is a material  concern  since  product  orders are either  manually  written and
submitted via fax, or are submitted on a Company  supplied  automated order form
that is Year 2000 compliant.

Some  commentators  have predicted  significant  litigation  regarding Year 2000
compliance issues. Because of the unprecedented nature of such litigation, it is
uncertain whether,  or to what extent, the Company may be affected.  However, at
this time the Company  believes that it is not likely to have a material adverse
effect on the Company or its operations.

                                      -14-
<PAGE>
BUSINESS ENVIRONMENT AND FUTURE RESULTS.

RELIANCE  ON THIRD PARTY  SUPPLIERS.  RG  currently  purchases a majority of its
supply of non-cord grips from Acushnet Rubber Company  ("Acushnet").  During the
transition to Acushnet beginning in December 1996,  Acushnet  experienced delays
and quality problems in the production of grips,  which adversely  affected RG's
customer relationships and results of operations.

During  March  1999,  RG  received  a  letter  from  Acushnet   terminating  the
Manufacturing and Supply Agreement and Capital Lease Agreement. In the notice of
termination, Acushnet agreed to pay RG a $2.5 million termination fee at the end
of the transition period, to continue to produce grips for ten months and to pay
up to $100,000 for shipping and installing the manufacturing  equipment at a new
location. In connection with the termination,  RG will receive the manufacturing
equipment and Acushnet's  obligation under the capital lease will be terminated.
At February 28, 1999,  the Company's  capital  equipment  lease  receivable  was
approximately $2.6 million. Also in the termination letter, Acushnet stated that
it would not continue paying the lease  payments.  The Company has not responded
to Acushnet's termination letter; however, the Company and legal counsel believe
that  Acushnet's  interpretation  of the clause in the  contract  related to the
lease payments is without merit and the Company will pursue its rights under the
contract to receive lease payments throughout the transition period.

RG currently has no back-up source of supply;  however, the Company is currently
in discussions  with a number of grip  manufacturers  which the Company believes
can  maintain  RG's  standard of product  quality and will  facilitate  a smooth
transition. There can be no assurances that the Company will be able to secure a
source  for grips on as  favorable  terms or with the same or better  quality as
Acushnet.  In addition,  there can be no  assurances  that a transition to a new
supplier  will not  result  in  production  delays,  the  loss of sales  and key
customers which would materially affect RG's financial  condition and results of
operations.

SALE OF ROXXI, INC. OPERATING ASSETS. During March 1999, the Company disposed of
the operating assets of Roxxi through two transactions  with unrelated  parties.
In one transaction,  Roxxi sold its trade name,  customer list,  design database
and related computer software and hardware. In return, the  Company will receive
a royalty of 16% of the buyer's net sales for the two-year period  beginning May
1,  1999.  In the second  transaction,  Roxxi  sold its  headwear  manufacturing
equipment,  headwear  inventory and raw materials.  Roxxi  received  $300,000 at
closing  and the Company  will  receive a royalty of 2% of the buyer's net sales
until the buyer has paid an additional $200,000.  Based on net headwear sales of
$3.0 million by Roxxi  during the twelve  months  ended  February 28, 1999,  the
Company could recognize royalty revenue of approximately $0.5 million in each of
the next two  fiscal  years  under  these  contracts.  However,  there can be no
assurance  that the two successor  companies will be able to achieve these sales
amounts in the future.

                                      -15-
<PAGE>
                                     PART II
                                OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS.

         None.

ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS.

         None.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES.

         None.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

         None.

ITEM 5.  OTHER INFORMATION.

         None.

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

         (a) Exhibits.

         (3) Certificate of Incorporation and Bylaws

               Exhibit 3.1. Amended and Restated Certificate of Incorporation of
          FM Precision Golf Corp.  (incorporated by reference to Annex IV to the
          Company's Form S-4; No. 333-28841 (the "Form S-4")).

               Exhibit 3.2. Bylaws of Royal  Precision,  Inc.  (incorporated  by
          reference to Exhibit 3.2 to the Form S-4).

         (4) Instruments Defining the Rights of Security Holders

               Exhibit 4. 1. See  Articles  FOUR,  FIVE and SEVEN of the Amended
          and Restated  Certificate of  Incorporation of FM Precision Golf Corp.
          (incorporated by reference to Exhibit 3.1 to the Form S-4).

               Exhibit  4.2.  See Article I,  Sections 2.1 and 2.2 of Article II
          and Section 7.3 of Article VII of the Bylaws of Royal Precision,  Inc.
          (incorporated by reference to Exhibit 3.2 to the Form S-4).

         (10) Material Contracts

               Exhibit  10.1.  Agreement  and Plan of Merger dated as of January
          31, 1999 among Royal  Precision,  Inc.,  Coyote  Sports,  Inc.  and RP
          Acquisition  Corp.  (incorporated  by reference to Exhibit 99.2 of the
          Report on Form 8-K of the registrant dated February 3, 1999).

                                      -16-
<PAGE>
               Exhibit 10.2.  Form of Certificate of Designation of the Series C
          Preferred  Stock  (incorporated  by  reference  to Exhibit 99.3 of the
          Report on Form 8-K of the registrant dated February 3, 1999).

               Exhibit 10.3. Amendment No. 1 to the Stockholder Agreement, dated
          as of May 12, 1997,  among Danny Edwards,  Drew M. Brown, DMB Property
          Ventures Limited Partnership, Mark N. Sklar, Bennett Dorrance, Trustee
          of the  Bennett  Dorrance  Trust  dated  April 21,  1989,  as amended,
          Christopher  A.  Johnston,  Richard P.  Johnston and Jayne A. Johnston
          Charitable  Remainder  Trust #3 (Richard  P.  Johnston,  Trustee),  as
          successor to RPJ/JAJ Partners,  Ltd., a Wyoming partnership,  David E.
          Johnston,  Berenson  Minella & Company,  L.P.,  Kenneth J.  Warren and
          Royal  Precision  (incorporated  by  reference  to Exhibit 99.4 of the
          Report on Form 8-K of the registrant dated February 3, 1999).

               Exhibit  10.4.   Form  of  Royal   Precision   Voting   Agreement
          (incorporated  by  reference to Exhibit 99.6 of the Report on Form 8-K
          of the registrant dated February 3, 1999).

         Exhibit 27.

               Financial  Data  Schedule   (submitted   electronically  for  SEC
          information only)

         (b) Reports on Form 8-K.

               Reports on Form 8-K were filed by the  Registrant  on January 20,
          1999 and February 3, 1999 reporting other events under Item 5.

                                      -17-
<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.

                                    ROYAL PRECISION, INC.

Date April 13, 1999                 By /s/ Thomas Schneider
-------------------                   ---------------------------------------
                                           Thomas Schneider, President (duly
                                           authorized officer)

                                    By /s/ Kevin Neill
                                      ---------------------------------------
                                           Kevin Neill, Vice President - Finance
                                           (chief accounting officer)

                                      -18-
<PAGE>
                                  EXHIBIT INDEX

                                                                     PAGE IN
                                                                   SEQUENTIALLY
                                                                     NUMBERED
EXHIBIT                                                                COPY
-------                                                                ----

3.1      Amended and Restated  Certificate of  Incorporation
         of registrant  (incorporated  by reference to Annex
         IV to the Company's Form S-4, No.  333-28841)  (the
         "Form S-4")                                                     *

3.2      Bylaws of Royal  Precision,  Inc.  (incorporated by
         reference to Exhibit 3.2 to the Form S-4)                       *

4.1      See  Articles  FOUR,  FIVE and SEVEN of the Amended
         and Restated  Certificate of  Incorporation  of the
         registrant  (incorporated  by  reference to Exhibit
         3.1 to the Form S-4.                                            *

4.2      See Article I,  Sections  2.1 and 2.2 of Article II
         and  Section  7.3 of  Article  VII of the Bylaws of
         Royal Precision, Inc. (incorporated by reference to
         Exhibit 3.2 to the Form S-4)                                    *

10,1     Agreement  and Plan of Merger  dated as of  January
         31,  1999  among  Royal  Precision,   Inc.,  Coyote
         Sports, Inc. and RP Acquisition Corp. (incorporated
         by  reference to Exhibit 99.2 of the Report on Form
         8-K of the registrant dated February 3, 1999).                  *

10.2     Form of  Certificate of Designation of the Series C
         Preferred  Stock   (incorporated  by  reference  to
         Exhibit  99.3  of the  Report  on  Form  8-K of the
         registrant dated February 3, 1999)                              *

10.3     Amendment No. 1 to the Stockholder Agreement, dated
         as of May 12, 1997,  among Danny  Edwards,  Drew M.
         Brown, DMB Property  Ventures Limited  Partnership,
         Mark N.  Sklar,  Bennett  Dorrance,  Trustee of the
         Bennett  Dorrance  Trust dated April 21,  1989,  as
         amended,   Christopher  A.  Johnston,   Richard  P.
         Johnston and Jayne A. Johnston Charitable Remainder
         Trust  #3  (Richard  P.  Johnston,   Trustee),   as
         successor  to  RPJ/JAJ  Partners,  Ltd.,  a Wyoming
         partnership,  David E. Johnston, Berenson Minella &
         Company,   L.P.,   Kenneth  J.   Warren  and  Royal
         Precision  (incorporated  by  reference  to Exhibit
         99.4 of the  Report  on Form 8-K of the  registrant
         dated February 3, 1999).                                        *

10.4     Form   of   Royal   Precision    Voting   Agreement
         (incorporated  by  reference to Exhibit 99.6 of the
         Report on Form 8-K of the registrant dated February
         3, 1999)                                                        *

27.      Financial Data Schedule  (submitted  electronically
         for SEC information only)

*Incorporated by reference