U.S. SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549


                             AMENDMENT NO. 2 TO THE
                                   FORM 10-QSB



         (MARK ONE)

  |X|     Quarterly Report Pursuant to Section 13 or 15(d) of Securities
          Exchange Act of 1934

                  For the quarterly period ended JUNE 30, 2001

  |_|     Transition report under Section 13 or 15(d) of the Securities
          Exchange Act of 1934

               For the transition period from _______ to _______.

                          Commission File No. 000-26631

                        SAFE TRANSPORTATION SYSTEMS, INC.
                        ---------------------------------
                 (Name of Small Business Issuer in Its Charter)

Florida                                         59-3567558
-------                                         ----------
(State or Other Jurisdiction of            (I.R.S. Employer Identification  No.)
Incorporation  or Organization)
3871 Airport Way, Bellingham, Wa 98226                98226
--------------------------------------                -----
(Address of Principal Executive Offices)           (Zip Code)

                                 (360) 527-1112
                (Issuer's Telephone Number, Including Area Code)


         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,  and (2) has
been subject to such filing requirements for the past 90 days. Yes |X| No |_|



There were 18,305,685 shares of Common Stock outstanding as of October 25, 2001.

<PAGE>

                         PART I -- FINANCIAL INFORMATION

ITEM 1.     FINANCIAL STATEMENTS


                                               SAFE TRANSPORTATION SYSTEMS, INC.
                                                   (A DEVELOPMENT STAGE COMPANY)
--------------------------------------------------------------------------------

                                                  CONDENSED FINANCIAL STATEMENTS

                                                                   JUNE 30, 2001




                                       2
<PAGE>

C O N T E N T S
                                                                      Page
--------------------------------------------------------------------------------

CONDENSED FINANCIAL STATEMENTS

         Balance Sheet                                                  4

         Statements of Operations                                       5

         Statements of Cash Flows                                       6

         Notes to Condensed Financial Statements                      7 - 9

                                       3
<PAGE>

    SAFE TRANSPORTATION SYSTEMS, INC.
--------------------------------------------------------------------------------
    (A DEVELOPMENT STAGE COMPANY)
    CONDENSED BALANCE SHEET (UNAUDITED)
    JUNE 30, 2001

ASSETS
--------------------------------------------------------------------------------

CURRENT ASSETS
     Cash                                                     $       52,033
     Inventory                                                         3,906
--------------------------------------------------------------------------------
         Total current assets                                         55,939

PROPERTY AND EQUIPMENT, net                                          212,635

PREPAID LOAN COSTS                                                    24,000

PATENT PENDING COSTS                                                  11,469
--------------------------------------------------------------------------------

         TOTAL ASSETS                                         $      304,043
--------------------------------------------------------------------------------

LIABILITIES AND DEFICIENCY IN ASSETS
--------------------------------------------------------------------------------

CURRENT LIABILITIES
     Accounts payable and accrued expenses                    $      703,085
     Loans payable                                                    40,950
--------------------------------------------------------------------------------
         Total current liabilities                                   744,035

NOTE PAYABLE                                                         175,000
--------------------------------------------------------------------------------

         TOTAL LIABILITIES                                           919,035
--------------------------------------------------------------------------------

DEFICIENCY IN ASSETS
     Preferred stock, no par value 5,000,000
        shares authorized, no shares issued
        and outstanding                                                    -
     Common stock, $0.001 par value 50,000,000
        shares authorized, 18,014,018
         shares issued and outstanding                                18,014
     Additional paid-in capital                                    7,947,984
     Accumulated other comprehensive expense                 (         6,794)
     Deficit accumulated during the development stage        (     8,574,196)
--------------------------------------------------------------------------------
         Total deficiency in assets                          (       614,992)
--------------------------------------------------------------------------------
         TOTAL LIABILITIES AND DEFICIENCY IN ASSETS           $      304,043
--------------------------------------------------------------------------------

                                       4
<PAGE>

SAFE TRANSPORTATION SYSTEMS, INC.
--------------------------------------------------------------------------------
(A DEVELOPMENT STAGE COMPANY)
CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED)

<TABLE>
<CAPTION>

                                                  Three Months Ended June 30,      Six Months Ended June 30,          Inception
                                                -------------------------------- -------------------------------  (July 8, 1998) to
                                                     2001            2000             2001            2000         to June 30, 2001
----------------------------------------------- --------------- ---------------- --------------- --------------- ----------------
<S>                                             <C>             <C>              <C>             <C>              <C>
SALES                                             $      -        $       -        $      -        $      -       $        -
----------------------------------------------- --------------- ---------------- --------------- --------------- ----------------

OPERATING EXPENSES
   Selling, general and administrative
     Non-cash compensation and services                  -                -               -               -        6,861,340
     Other selling, general and administrative     212,442           75,268         580,319         111,481        1,376,066
   Research and development                              -                -               -               -          336,790
----------------------------------------------- --------------- ---------------- --------------- --------------- ----------------
       Total operating expenses                    212,442           75,268         580,319         111,481        8,574,196
----------------------------------------------- --------------- ---------------- --------------- --------------- ----------------

NET LOSS                                        ( $212,442)     ( $  75,268)     ( $580,319)     ( $111,481)      $8,574,196
----------------------------------------------- --------------- ---------------- --------------- --------------- ----------------

LOSS PER SHARE - BASIC AND DILUTED              ( $   0.01)     ( $    0.01)     ( $   0.03)     ( $   0.01)
----------------------------------------------- --------------- ---------------- --------------- --------------- ----------------

WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING   17,881,607       11,557,076      17,739,399      11,533,076
----------------------------------------------- --------------- ---------------- --------------- --------------- ----------------
</TABLE>

                                       5
<PAGE>

SAFE TRANSPORTATION SYSTEMS, INC.
(A DEVELOPMENT STAGE COMPANY)
CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED)

<TABLE>
<CAPTION>
                                                                          Six Months Ended June 30,                 Inception
                                                                  -------------------------------------------   (July 8, 1998) to
                                                                          2001                  2000             to June 30, 2001
----------------------------------------------------------------- --------------------- --------------------- ---------------------
<S>                                                               <C>                   <C>                   <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
   Net loss                                                       ( $      580,319)     ( $      111,481)     ( $    8,574,196)
   Adjustments to reconcile net loss to net cash provided by
     (used in) operating activities:
     Depreciation                                                           10,418                   794                13,507
     Issuance of stock for services                                              -                     -             5,719,690
     Issuance of stock options for services                                      -                     -             1,141,650
     Changes in operating assets and liabilities:
       Inventory                                                  (          3,906)                    -      (          3,906)
       Patent pending costs                                                      -      (         10,804)     (         11,469)
       Accounts payable and accrued expenses                               518,892                 2,860               696,292
----------------------------------------------------------------- --------------------- --------------------- ---------------------
           Net cash used in operating activities                  (         54,915)     (        118,631)     (      1,018,432)
----------------------------------------------------------------- --------------------- --------------------- ---------------------

CASH FLOWS FROM INVESTING ACTIVITIES:
   Proceeds from returns of equipment                                       46,521                     -                46,521
   Purchase of property and equipment                             (        241,660)     (         14,750)     (        272,665)
----------------------------------------------------------------- --------------------- --------------------- ---------------------
           Net cash used in investing activities                  (        195,139)     (         14,750)     (        226,144)
----------------------------------------------------------------- --------------------- --------------------- ---------------------

CASH FLOWS FROM FINANCING ACTIVITIES:
   Proceeds from loans payable                                             215,950                     -               215,950
   Prepaid loan costs                                             (         24,000)                    -      (         24,000)
   Net advances from stockholders                                                -                     -               194,261
   Proceeds from sale of stock                                             109,412               133,179               910,398
----------------------------------------------------------------- --------------------- --------------------- ---------------------
           Net cash provided by financing activities                       301,362               133,179             1,296,609
----------------------------------------------------------------- --------------------- --------------------- ---------------------

NET INCREASE (DECREASE) IN CASH                                             51,308      (            202)               52,033

CASH - BEGINNING OF PERIOD                                                     725                   397                     -
----------------------------------------------------------------- --------------------- --------------------- ---------------------

CASH - END OF PERIOD                                                $       52,033        $          195        $       52,033
----------------------------------------------------------------- --------------------- --------------------- ---------------------

Supplemental Disclosures of Cash Flow Information:
----------------------------------------------------------------- --------------------- --------------------- ---------------------

   Interest paid                                                    $        8,242        $            -        $        8,242
----------------------------------------------------------------- --------------------- --------------------- ---------------------

   Income taxes paid                                                $            -        $            -        $            -
----------------------------------------------------------------- --------------------- --------------------- ---------------------
</TABLE>

                                       6
<PAGE>

SAFE TRANSPORTATION SYSTEMS, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
--------------------------------------------------------------------------------
NOTE 1.           BASIS OF PRESENTATION AND CONSOLIDATION
--------------------------------------------------------------------------------

                  BASIS OF PRESENTATION

                  The accompanying unaudited condensed financial statements have
                  been  prepared  in  accordance  with   accounting   principles
                  generally  accepted in the United States for interim financial
                  information  and  with the  instructions  to Form  10-QSB  for
                  quarterly  reports under section 13 or 15(d) of the Securities
                  Exchange Act of 1934. Accordingly,  they do not include all of
                  the  information  and  footnotes   necessary  for  a  complete
                  presentation of financial position,  results of operations and
                  cash flows in conformity with accounting  principles generally
                  accepted in the United States.

                  In the  opinion  of  management,  all  adjustments  considered
                  necessary for a fair  presentation have been included and such
                  adjustments  are  of  a  normal  recurring  nature.  Operating
                  results for the six month  period  ended June 30, 2001 are not
                  necessarily indicative of the results that may be expected for
                  the year ending December 31, 2001.

                  The audited  financial  statements for the year ended December
                  31, 2000, which are included in the Company's Annual Report on
                  Form  10-KSB,   should  be  read  in  conjunction  with  these
                  condensed financial statements.

--------------------------------------------------------------------------------
NOTE 2.           SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
--------------------------------------------------------------------------------

                  USE OF ESTIMATES

                  The  preparation  of financial  statements in conformity  with
                  accounting  principles generally accepted in the United States
                  requires  management to make  estimates and  assumptions  that
                  affect the  reported  amounts of assets  and  liabilities  and
                  disclosure  of  contingent  assets and  liabilities  as of the
                  balance  sheet date and the  reported  amounts of revenues and
                  expenses  during  the  respective  reporting  period.   Actual
                  results could differ from those estimates.

                  NET INCOME (LOSS) PER SHARE

                  Basic income (loss) per share is computed in  accordance  with
                  Statement of Financial Accounting Standards No. 128, "Earnings
                  Per Share"  (FAS 128)  using the  weighted  average  number of
                  common shares  outstanding during the period. All common stock
                  data has been restated to give effect to the  recapitalization
                  in  December   2000.   Outstanding   stock  options  were  not
                  considered  in the  calculation  of diluted loss per share for
                  the three and six month  periods  ended June 30, 2001 as their
                  effect   would   have  been   anti-dilutive.   There  were  no
                  potentially  dilutive securities  outstanding during the three
                  and six month periods ended June 30, 2000.

                                       7
<PAGE>

--------------------------------------------------------------------------------
NOTE 2.           SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
--------------------------------------------------------------------------------

                  NEW ACCOUNTING PRONOUNCEMENTS
                  In June 2001, the Financial  Accounting Standards Board issued
                  Statement of Financial Accounting Standards No. 141, "Business
                  Combinations,"  and No. 142,  "Goodwill  and Other  Intangible
                  Assets",  effective for fiscal years  beginning after December
                  15, 2001. Under the new rules,  goodwill and intangible assets
                  deemed to have  indefinite  lives will no longer be  amortized
                  but will be subject to annual  impairment  tests in accordance
                  with the Statements.  Other intangible assets will continue to
                  be amortized over their useful lives.  The Company has not yet
                  determined what the effects of these Statements will be on its
                  financial position and results of operations.

                  In August  2001,  the  Financial  Accounting  Standards  Board
                  Issued  Statement of Financial  Accounting  Standards  No. 143
                  "Accounting for Asset Retirement  Obligations",  effective for
                  fiscal years  beginning  after June 15, 2002.  This  statement
                  addresses  financial  accounting and reporting for obligations
                  associated with the retirement of tangible  long-lived  assets
                  and the associated retirement costs.

                  In October 2001,  the  Financial  Accounting  Standards  Board
                  issued  Statement of Financial  Accounting  Standards  No. 144
                  "Accounting  for the  Impairment  or  Disposal  of  Long-lived
                  Assets",  effective for fiscal years  beginning after December
                  15, 2001. This statement  addresses  financial  accounting and
                  reporting for the impairment or disposal of long-lived assets.

                  The Company  believes that adopting the above  statements will
                  not have a material impact on the financial statements.

--------------------------------------------------------------------------------
NOTE 3.           GOING CONCERN
--------------------------------------------------------------------------------

                  The  Company has  incurred  significant  operating  losses and
                  negative  cash  flows from  operations  since  inception.  The
                  Company's  ability to continue as a going concern is dependent
                  upon achieving  profitable  operations and positive cash flows
                  from operations or obtaining debt or equity  financing.  These
                  conditions raise substantial doubt about the Company's ability
                  to continue as a going  concern.  The financial  statements do
                  not include any adjustments that might result from the outcome
                  of these uncertainties.

--------------------------------------------------------------------------------
NOTE 4.           STOCK SUBSCRIPTION
--------------------------------------------------------------------------------

                  In January  2001,  the Company  commenced a private  placement
                  offering of securities. The Company was seeking to raise up to
                  $5,700,000  by selling up to 3,700,000  shares of common stock
                  at $1 per share and 1,000,000 shares of common stock at $2 per
                  share.  In August 2001,  the Company  repriced the offering at
                  $0.12 per share and issued three attached warrants to purchase
                  one share of common stock with each warrant at exercise prices
                  of $0.25,  $0.375 and $0.50.  All shares issued related to the
                  private placement have been adjusted for this repricing.

                                       8
<PAGE>

--------------------------------------------------------------------------------
NOTE 5.           NOTE PAYABLE
--------------------------------------------------------------------------------

                  Note  payable  at  June  30,  2001 is to an  individual  which
                  originally  was due in monthly  installments  of principal and
                  interest through  December 15, 2001. The Company  defaulted on
                  the  original   terms  of  the  note  and  in  October   2001,
                  renegotiated  the terms of the note with the  lender.  The new
                  terms of the note provide for monthly interest payments at 12%
                  per annum through  December 31, 2001 and 18% thereafter,  with
                  principal due in January 2003. Accordingly,  the note has been
                  classified as long-term in the accompanying  condensed balance
                  sheet.

--------------------------------------------------------------------------------
NOTE 6.           SUBSEQUENT EVENTS
--------------------------------------------------------------------------------

                  ISSUANCE OF COMMON STOCK

                  In August 2001, the Company issued  2,050,000 shares of common
                  stock for services to various  professionals,  consultants and
                  employees.

                  CONVERTIBLE DEBENTURES

                  In September and October 2001,  the Company  borrowed  $40,000
                  from various parties and issued  convertible  debentures which
                  provide for, among other things,  interest at 6% per annum and
                  mature five years from the funding date.  The  debentures  are
                  convertible at the holder's  option any time up to maturity at
                  a specified  price, as defined.  At the Company's  option,  at
                  maturity, the entire principal amount and all accrued interest
                  shall be  either  paid to the  holder or  converted  to common
                  stock at a specified price, as defined.

                  In connection with these convertible  debentures,  the Company
                  has entered into various  consulting  agreements which provide
                  for,  among  other  things,  the  payment  of  commissions  of
                  approximately 15% of all monies raised.

                                       9
<PAGE>

            MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

         THE  FOLLOWING  INFORMATION  SHOULD  BE READ IN  CONJUNCTION  WITH  THE
CONSOLIDATED  FINANCIAL  STATEMENTS OF SAFE TRANSPORTATION AND THE NOTES THERETO
APPEARING ELSEWHERE IN THIS FILING.  STATEMENTS IN THIS MANAGEMENT'S  DISCUSSION
AND ANALYSIS OR PLAN OF  OPERATION  THAT ARE NOT  STATEMENTS  OF  HISTORICAL  OR
CURRENT FACT CONSTITUTE "FORWARD-LOOKING STATEMENTS."

OVERVIEW

         Safe  Transportation was incorporated in Florida on December 6, 1994 as
Big Daddy's  Auto Sales,  Inc. On April 19, 2000,  Big Daddy's Auto Sales,  Inc.
changed its name to Sweets & Eats,  Inc. On December  18,  2000,  Sweets & Eats,
Inc.  entered into a reverse merger with Safe  Transportation  Systems,  Inc. In
that  merger,  the former  shareholders  of Safe  Transportation  Systems,  Inc.
received  12,000,000  shares of common stock for all of the common stock of Safe
Transportation Systems, Inc.

         Between July 1998 and October 2000, Safe  Transportation  developed and
tested  safety  products  for the  trucking  industry.  During  that time,  Safe
Transportation  spent  approximately  $1.8 million on developing and patenting a
proprietary  technology called the Accident Control and  Anti-Jackknife  System.
This system is intended to help prevent a  tractor-trailer  from losing  control
and  jackknifing  (i.e.,  the loss of  traction  by the rear wheels of a tractor
causing it to rotate rapidly to approximately a 90 degree angle to the trailer).

         Safe  Transportation's  Accident Control and  Anti-Jackknife  System is
attached to the underside of the trailer.  The system is turned on during normal
driving,  but may be  deactivated  by the driver if  desired.  The system has an
engaging  bar that limits the amount of rotation of the tractor  relative to the
trailer and prevents the trailer from swinging out-of-control.

PLAN OF OPERATION

         Safe Transportation has not had revenues from operations in each of the
last two fiscal years, or the last fiscal year and the six months ended June 30,
2001. As such, Safe Transportation is required to provide a Plan of Operation.

         During the next twelve months, Safe Transportation  intends to focus on
marketing its product for sale. To that end, Safe  Transportation  has performed
several  key  marketing  activities  recently,  including  the  development  and
production   of  sales   materials,   a  follow  up  campaign  to  tank  trailer
manufacturers  and seven hundred and fifty trucking  companies and participation
in industry  sponsored  conferences  such as the American  Trucking  Associates'
Safety & Loss Prevention Council, the American Trucking  Association  Management
Council, the Truck Trailer Manufacturers  Association  Convention,  the National
Truck Carriers  Association  Conference,  the Commercial Vehicle Safety Alliance
Conference,  the National Association of Chemical Distributors  Conference,  the
California  Trucking  Association  Safety  Conference  and the  Oregon  Trucking
Association Safety Conference.

         Safe  Transportation  has out-sourced the manufacture of its technology
to a third party and intends to concentrate its efforts on the sales,  marketing
and distribution of its product.

                                       10
<PAGE>

RESEARCH AND DEVELOPMENT

         Safe  Transportation  believes that its product is ready for market and
does not anticipate  incurring any significant research and development expenses
over the next 12 months.

PLANT AND EQUIPMENT

         Safe  Transportation  does not  anticipate  incurring  any  significant
expenses for the purchase of plant or equipment over the next 12 months.

EMPLOYEES

         Safe   Transportation  has  five  full  time  employees  and  does  not
anticipate  any  material  changes in the number of  employees  over the next 12
months.

RESULTS OF OPERATIONS

         During the six months ended June 30, 2001, Safe  Transportation  had no
revenues  from  operations.  It incurred  selling,  general  and  administrative
expenses of $580,319 in the six months ended June 30, 2001  compared to $111,481
in the comparable  period in the prior year.  This increase in selling,  general
and   administrative   expenses  resulted   primarily  from  transitioning  Safe
Transportation  from a  research  and  development  company to a  marketing  and
distribution company.  Selling,  general and administrative expenses for the six
months ended June 30, 2001 consisting  primarily of payroll and payroll taxes of
$225,000, rent of $170,000, insurance of $45,000,  professional fees of $59,000,
travel expense of $27,000 and  miscellaneous  office expenses of $54,000.  These
operating  expenses resulted in a net loss of $580,319 or $0.03 per share in the
six months  ended June 30, 2001  compared to a net loss of $111,481 or $0.01 per
share in the comparable period in the prior year.

LIQUIDITY AND SOURCES OF CASH

         Safe   Transportation  is  dependent  on  external  cash  to  fund  its
operations. It will need to raise capital to continue operations and to complete
its  transition  from a research  and  development  company to a  marketing  and
distribution company.  During this transition,  Safe Transportation  anticipates
that  its  most  significant   operating  expense  will  be  sales,   marketing,
distribution  and  technical  support  expenses.  As  of  June  30,  2001,  Safe
Transportation had $52,033 of cash-on-hand.  In September and October 2001, Safe
Transportation  received  $40,000 from the issuance of  convertible  debentures.
These debentures  accrue interest at a rate of 6% per year and mature five years
from the issuance date. The  debentures are  convertible at the holder's  option
any time up to maturity at a conversion price equal to the lower of (i) $0.24 or
(ii) 80% of the lowest  closing bid price of the common  stock for the 5 trading
days immediately preceding the conversion date. At maturity, Safe Transportation
has the option to either pay the holder the  outstanding  principal  balance and
accrued  interest or to convert the debentures  into shares of common stock at a
conversion  price  equal  to the  lower of (i)  $0.24 or (ii) 80% of the  lowest
closing  bid  price of the  common  stock  for the 5  trading  days  immediately
preceding the conversion date.

         Safe Transportation has judgments against it for a total of $64,309.98,
plus interest.  These amounts are due and payable.  Safe Transportation does not
have enough  cash-on-hand to satisfy these  judgments.  Excluding the judgments,
Safe  Transportation  believes it has sufficient funds to finance its operations

                                       11
<PAGE>

for the next three months. Thereafter,  Safe Transportation will need additional
capital to finance  its  operations  and to satisfy the  judgments.  In order to
raise such capital,  Safe  Transportation  will need to raise additional capital
from loans or the sale of securities, if available. Safe Transportation does not
have any commitments to receive capital from any source.

EFFECT OF RECENT ACCOUNTING PRONOUNCEMENTS

         In June 2001, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 141, "Business Combinations," and No. 142,
"Goodwill and Other  Intangible  Assets",  effective for fiscal years  beginning
after December 15, 2001.  Under the new rules,  goodwill and  intangible  assets
deemed to have indefinite  lives will no longer be amortized but will be subject
to annual  impairment tests in accordance with the Statements.  Other intangible
assets will continue to be amortized over their useful lives.

         In  August  2001,  the  Financial  Accounting  Standards  Board  Issued
Statement  of  Financial  Accounting  Standards  No. 143  "Accounting  for Asset
Retirement  Obligations",  effective for fiscal years  beginning  after June 15,
2002.  This  statement   addresses   financial   accounting  and  reporting  for
obligations associated with the retirement of tangible long-lived assets and the
associated retirement costs.

         In October  2001,  the  Financial  Accounting  Standards  Board  issued
Statement  of  Financial  Accounting  Standards  No.  144  "Accounting  for  the
Impairment  or  Disposal  of  Long-lived  Assets",  effective  for fiscal  years
beginning after December 15, 2001. This statement addresses financial accounting
and reporting for the impairment or disposal of long-lived assets.

         Safe  Transportation  believes that adopting the above  statements will
not have a material impact on the financial statements.

                                       12
<PAGE>

                                     PART II
                                OTHER INFORMATION

ITEM 1.           LEGAL PROCEEDINGS.

         Safe   Transportation   received  a  demand   letter  from  its  former
accountants,  Sweeney & Gates,  Co. In its letter,  Sweeney & Gates, Co. alleged
that Safe Transportation owed them $11,050 for past due accounting services.

         In  August   2001,  a  default   judgment  was  entered   against  Safe
Transportation for $9,652.39, plus interest. The case was styled as Raelyn, Ltd.
V. Safe Transportation  Systems,  Inc., case no.  01-2-01296-3,  in the Superior
Court of the State of Washington in and for Whatcom County. The judgment relates
to the non-payment of development expenses.

         In August 2001, a judgment was entered against Safe  Transportation for
$23,676.44,  plus  interest.  The case was styled as Higher Plane  Cabinetworks,
Inc. v. Safe Transportation Systems, Inc., case no. 01-2-01058-8, Superior Court
of Washington  for Skagit  County.  The judgment  relates to the  non-payment of
leasehold improvements.

         In August 2001, a judgment was entered against Safe  Transportation for
$30,981.15,  plus  interest.  The case was styled as  Virginia M. Benton v. Safe
Transportation,  et al, case no. CV01-1408,  In the District Court of the County
of  Whatcom  in and for the State of  Washington.  The  judgment  relates to the
non-payment of back wages to a former employee.

ITEM 2.           CHANGES IN SECURITIES AND USE OF PROCEEDS.

(a), (b) and (d).  None.

(c)      Sale of Unregistered Securities.
         -------------------------------

         Between  January  and July 2001,  Safe  Transportation  sold  1,255,685
shares of common stock for a total of $150,682, or $0.12 per share.

         In  August  2001,  Safe  Transportation   issued  options  to  purchase
2,050,000 shares of common stock at an exercise price of $0.12 per share.  These
options  expire on December 31, 2002, and were issued in exchange for consulting
and employment services.

         Between  September  and  October  2001,  Safe  Transportation  received
$40,000 from the issuance of convertible  debentures.  These  debentures  accrue
interest at a rate of 6% per year and mature five years from the issuance  date.
The debentures are convertible at the holder's option any time up to maturity at
a  conversion  price  equal to the lower of (i) $0.24 or (ii) 80% of the  lowest
closing  bid  price of the  common  stock  for the 5  trading  days  immediately
preceding the conversion date. At maturity,  Safe  Transportation had the option
to either pay the holder the outstanding  principal balance and accrued interest
or to convert the debentures  into shares of common stock at a conversion  price
equal to the lower of (i) $0.24 or (ii) 80% of the lowest  closing  bid price of
the common stock for the 5 trading days  immediately  preceding  the  conversion
date.

                                       13
<PAGE>

         With respect to the sale of unregistered  securities  referenced above,
all transactions were exempt from  registration  pursuant to Section 4(2) of the
Securities Act of 1933 (the "1933 ACT"), and Regulation D promulgated  under the
1933 Act. In each instance,  the purchaser had access to sufficient  information
regarding Safe  Transportation  so as to make an informed  investment  decision.
More  specifically,  Safe  Transportation had a reasonable basis to believe that
each  purchaser was an  "accredited  investor" as defined in Regulation D of the
1933 Act and otherwise had the requisite sophistication to make an investment in
Safe Transportation's securities.

ITEM 3.           DEFAULTS UPON SENIOR SECURITIES.

None.

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

None.

ITEM 5.           OTHER INFORMATION.

None.

                                       14
<PAGE>

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

(a)      EXHIBITS.
         --------
<TABLE>
<CAPTION>
 EXHIBIT
  NO.          DESCRIPTION                                 LOCATION
  ---          -----------                                 --------
<S>            <C>                                         <C>

2.1            Articles of Merger Between Safe             Incorporated by reference to Exhibit 2.1 to
               Transportation Systems, Inc. and Sweets     the Registrant's Annual Report as filed on
               and Eats. Inc. dated December 28, 2000      Form 10-KSB on April 17, 2001 (the "Form
                                                           10-KSB")

2.2            Certificate of Incorporation of Safe        Incorporated by reference to Exhibit 2.2 to
               Transportation Systems, Inc.                the Registrant's Form 10-KSB

2.3            Certificate of Continuance and Good         Incorporated by reference to Exhibit 2.3 to
               Standing of Safe Transportation Systems,    the Registrant's Form 10-KSB
               Inc.

2.4            Articles of Incorporation of Big Daddy's    Incorporated by reference to Exhibit 2.4 to
               Auto Sales, Inc.                            the Registrant's Form 10-KSB

2.5            Amendment to Articles of Incorporation of   Incorporated by reference to Exhibit 2.5 to
               Big Daddy's Auto Sales, Inc.                the Registrant's Form 10-KSB

2.6            Amendment to Articles of Incorporation      Incorporated by reference to Exhibit 2.6 to
                                                           the Registrant's Form 10-KSB

2.7            Amendment of Articles of Incorporation      Incorporated by reference to Exhibit 2.7 to
                                                           the Registrant's Form 10-KSB

2.8            Bylaws                                      Incorporated by reference to Exhibit 2.8 to
                                                           the Registrant's Form 10-KSB

10.1           Lease Agreement, between Safe               Incorporated by reference to Exhibit 6.2 to
               Transportation Systems, Inc. and the Port   the Registrant's Form 10-KSB
               of Bellingham

10.2           Merger Agreement, dated December 18, 2000,  Incorporated by reference to Exhibit 8.1 to
               between Safe Transportation, Inc. and       the Registrant's Form 10-KSB
               Sweets and Eats, Inc.

                                       15
<PAGE>

 EXHIBIT
  NO.          DESCRIPTION                                 LOCATION
  ---          -----------                                 --------

10.3           Agreement for the Exchange of Common        Incorporated by reference to Exhibit 8.2 to
               Stock, dated December 18, 2000, between     the Registrant's Form 10-KSB
               Safe Transportation, Inc. and Sweets and
               Eats, Inc.

10.4           Executive Employment Agreement, dated       Incorporated by reference to Exhibit 99.1 to
               January 1, 2001, between Safe               the Registrant's Form 10-KSB
               Transportation Systems, Inc. and Ian Pallet

10.5           Executive Employment Agreement, dated       Incorporated by reference to Exhibit 99.2 to
               January 1, 2001, between Safe               the Registrant's Form 10-KSB
               Transportation Systems, Inc. and James B.
               Long

99.1           Pacific Traffic Education Centre Inc. Test  Incorporated by reference to Exhibit 12.1 to
               Report                                      the Registrant's Form 10-KSB

99.2           Transportation Research Center Inc. Test    Incorporated by reference to Exhibit 12.2 to
               Report                                      the Registrant's Form 10-KSB

99.3           Bacon Donaldson Test Report                 Incorporated by reference to Exhibit 12.3 to
                                                           the Registrant's Form 10-KSB
</TABLE>

(b)      REPORTS ON FORM 8-K.
         -------------------

         Safe  Transportation  filed a report  on Form 8-K on  August  27,  2001
disclosing  that on December 18, 2000,  Safe  Transportation  dismissed James E.
Scheifley & Associates,  P.C., the independent  certified public  accountants of
Safe Transportation.

         Safe  Transportation  filed a report on Form 8-K on September  10, 2001
disclosing that on August 22, 2001, Safe Transportation engaged Kaufman Rossin &
Company as its new independent certified public accountants.

                                       16
<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.


October 29, 2001                   SAFE TRANSPORTATION SYSTEMS, INC.


                                   By:    /s/  Ian Pallet
                                          ------------------------
                                   Name:  Ian Pallet
                                          ------------------------
                                   Title: President
                                          ------------------------

                                       17