REDNECK FOODS INC, SB-2, 1998-12-04

REDNECK FOODS INC
SB-2, 1998-12-04
EATING PLACES

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<PAGE>2

Commission File Number 0-24093

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM SB-2
REGISTRATION STATEMENT
Under The Securities Act of 1933

REDNECK FOODS, INC.

DELAWARE 56-203-5983
(State or other (Primary Standard Industrial (I.R.S. Employer
jurisdictions Classification Code Number) Identification Number)
of incorporation
or organization)
1280 Hendersonville Road
Asheville, NC 28803
Telephone: 828-277-5577
Facsimile: 828-277-0504
(Address and telephone number of registrant's principal executive
offices and principal place of business.)

Incorporating Services, Ltd.
15 E. North Street, P.O. Box 899
Dover, Delaware 19903
(Name, address and telephone number of agent for service.)

with copies to:
Jody M. Walker
Attorney At Law
7841 South Garfield Way
Littleton, Colorado 80122

If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, check the following box: | x |
<TABLE>
CALCULATION OF REGISTRATION FEE
<CAPTION>
Title of each Proposed Proposed Amount of
class of Amount to be offering aggregate registration
securities registered price offering price fee
<S> <C> <C> <C> <C>
Common Stock
$.001 par value<F1> 595,000 $1.25 $743,750 $232.42
Common Stock<F2> 558,207 $2.2841 $1,275,000 $398.44
Common Stock<F3> 30,000 $1.00 $30,000 $9.38
Common Stock<F4> 510,000 $2.449<F5> $1,249,068 $390.33

Total 1,693,207 $3,297,818 $1,030.57
</TABLE>
[FN]
<F1>Represents Common Stock to be registered on behalf of Selling
Shareholders.
<F2>Represents common stock to be issued upon conversion of Convertible
Debentures
<F3>Represents common stock to be issued upon exercise of options
<F4>Represents Common Stock to be issued upon exercise of warrants to be
issued pursuant to the acquisition of Woody's Bar-B-Cue
<F5>Based on the weighted average of the exercise price for purposes of
calculating the filing fee.

The registrant hereby amends this registration statement on such date or
dates as may be necessary to delay its effective date until the registrant
shall file a further amendment which specifically states that this
registration statement shall thereafter become effective in accordance with
Section 8(a) of the Securities Act of 1933 or until the registration
statement shall become effective on such date as the Commission, acting
pursuant to said Section 8(a), may determine.

<PAGE>3

PRELIMINARY PROSPECTUS DATED December 3, 1998
SUBJECT TO COMPLETION

595,000 Common Shares on behalf of Selling Shareholders
558,207 Common Shares to be issued upon conversion of convertible Debt
30,000 Common Shares to be issued upon exercise of options
510,000 Common Shares underlying warrants on behalf of selling shareholder

Redneck Foods, Inc.
Common Stock
($.001 Par Value)

The Company is registering 595,000 Common Shares and 30,000 Common Shares
underlying 30,000 options on behalf of its selling security holders. The
Company is also registering 558,207 Common Shares to be issued upon the
conversion of its Series 1 Secured Convertible Debentures. The Debentures
are convertible into Common Shares at the lower of $2.51 (reduced by 3% per
month until this registration statement is declared effective - currently
calculated at $2.2841) or 70% of the average of the closing bid price of the
stock for the previous five (5) business days. Additionally, the Company is
registering 510,000 Common Shares underlying Warrants issued pursuant to the
arranging of the sale of the Convertible Debentures. The Warrants have a
three year exercise period and allow the holders to purchase Common Shares at
the various prices as follows: $2.64 (80,000 shares), $2.625 (110,000
shares), $2.4375 (260,000 shares); $2.03125 (20,000 shares), and $1.8687
(40,000) shares).

The 595,000 common shares being registered on behalf of selling security
holders consist of 595,000 Common Shares to unaffiliated shareholders.
See "Selling Security Holders". Prior to the date hereof, there has been a
limited trading market for the Common Stock of the company. There can be no
assurance that an active trading and/or a liquid market will ever develop or,
if developed, that it will be maintained.

The Company has registered its securities under Section 12G of the
Exchange Act of 1934.

THE COMPANY IS CONSIDERED TO BE IN UNSOUND FINANCIAL CONDITION. PERSONS
SHOULD NOT INVEST UNLESS THEY CAN AFFORD TO LOSE THEIR ENTIRE INVESTMENT.

THERE ARE MATERIAL RISKS IN CONNECTION WITH THE ISSUANCE OF THE SECURITIES.
SEE RISK FACTORS, PAGE 8.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE. DUE TO THE CONTEMPORANEOUS PRIMARY OFFERING
BY THE COMPANY AND SECONDARY OFFERING BY SELLING SHAREHOLDERS, CONFLICTS OF
INTERESTS BETWEEN THE COMPANY AND SELLING SHAREHOLDERS MAY ARISE. SEE TERMS
OF THE OFFERING AND RISK FACTORS.

Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold
nor may offers to buy be accepted prior to the time the registration
statement becomes effective. This prospectus shall not constitute an offer
to sell or the solicitation of an offer to buy nor shall there be any sales
of these securities in any State in which such offer, solicitation or sale
would be unlawful prior to registration or qualification under the securities
laws of any state.

The Company is a newly formed company, which currently intends to acquire and
operate barbecue restaurants to be known as "Foxworthy's Smoke House Grill"
or "Foxworthy's Bar-B-Q," The Company intends initially to acquire existing
barbecue restaurants for conversion to one of the two restaurant concepts.
The Company also intends to market and distribute barbecue sauces and salsas
under trademarks using the "Foxworthy" name and may also, at a later time,
distribute other food products which are related to the restaurant menu.

<PAGE>4
[FN]
<F1> This Offering will terminate on or before September 30, 1999. In the
Company's sole discretion, the offering of Common Shares may be extended for
up to three Thirty day periods, but in no event later than December 31, 1999.
See "TERMS OF THE OFFERING - Plan of Distribution."

<F2>The amount as shown in the preceding table does not reflect the
deductions of (1) general expenses payable by the Company; and (2) fees
payable in connection with legal and accounting expenses incurred in this
Offering. These expenses are estimated to be $64,030.57. The selling
shareholders will not pay any of the expenses associated with this offering.

REPORTS TO SECURITY HOLDERS

The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended, and in accordance therewith
files reports and other information with the Securities and Exchange
Commission. The reports and other information filed by the
Company can be inspected and copied at the public reference facilities
maintained by the Commission in Washington, D.C. and at the Chicago
Regional Office, Citicorp Center, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661-2511 and the New York Regional Office, 7 World
Trade Center, New York, New York 10048. Copies of such material can
be obtained from the Public Reference Section of the Commission,
Washington, D.C. 20549 at prescribed rates.

The Company will furnish to shareholders: (i) an annual report containing
financial information examined and reported upon by its certified public
accountants; (ii) unaudited financial statements for each of the first three
quarters of the fiscal year; and (iii) additional information concerning the
business and operations of the Company deemed appropriate by the Board
of Directors.

The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement (together with all amendments and
exhibits thereto, the "Registration Statement") under the Act with respect to
the securities offered hereby. This Prospectus does not contain all of the
information set forth in the Registration Statement, certain parts of which
are omitted in accordance with the Rules and Regulations of the Commission.
For further information with respect to the Company and the securities
offered hereby, reference is made to the Registration Statement. Copies of
such materials may be examined without charge at, or obtained upon payment of
prescribed fees from, the Public Reference Section of the Commission at Room
1024, Judiciary Plaza, 450 Fifth Street, N.W., Washington, DC 20549, at the
Chicago Regional Office, Citicorp Center, 500 West Madison Street, Suite
1400, Chicago, Illinois 60661-2511 and the New York Regional Office, 7 World
Trade Center, New York, New York 10048.

The Commission maintains a Web site -- //www.sec.gov -- that contains
reports, proxy and information statements and other information regarding
issuers that file electronically with the Commission.

UNTIL _____ , 1999 (90 DAYS AFTER THE DATE OF THE PROSPECTUS), ALL PERSONS
EFFECTING TRANSACTIONS IN THE REGISTERED SECURITIES, WHETHER OR NOT
PARTICIPATING IN THE OFFERING, MAY BE REQUIRED TO DELIVER A PROSPECTUS. THIS
IS IN ADDITION TO THE OBLIGATION OF SUCH PERSONS TO DELIVER A PROSPECTUS WHEN
ACTING AS UNDERWRITERS AND WITH RESPECT TO THEIR UNSOLD
ALLOTMENTS OR SUBSCRIPTIONS.

NO DEALER, SALESMAN, AGENT OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE
ANY INFORMATION OR TO MAKE ANY REPRESENTATION OTHER THAN THOSE CONTAINED IN
THIS PROSPECTUS. IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST
NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY, OR THE
UNDERWRITER, IF AN UNDERWRITER ASSISTS IN THE SALE OF THE SECURITIES.

THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER OR A SOLICITATION BY ANYONE TO
ANY PERSON IN ANY STATE, TERRITORY OR POSSESSION OF THE UNITED STATES IN
WHICH SUCH OFFER OR SOLICITATION IS NOT AUTHORIZED BY THE LAWS THEREOF, OR TO
ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION.

NEITHER THE DELIVERY OF THIS PROSPECTUS OR ANY SALE MADE HEREUNDER SHALL,
UNDER ANY CIRCUMSTANCES, CREATE AN IMPLICATION THAT THERE HAS NOT BEEN ANY
CHANGE IN THE FACTS SET FORTH IN THIS PROSPECTUS OR IN THE AFFAIRS OF THE
COMPANY SINCE THE DATE HEREOF.

Forward-Looking Statements and Associated Risk. This Registration
Statement, including the information incorporated herein by reference,
contains forward-looking statements including statements regarding, among
other items, the Company's growth strategies, and anticipated trends in the
Company's business and demographics. These forward-looking statements are
based largely on the Company's expectations and are subject to a number of
risks and uncertainties, certain of which are beyond the Company's control.
Actual results could differ materially from these forward-looking statements
as a result of the factors described in this section "Risk Factors,"
including among others, regulatory or economic influences.

<PAGE>5

<TABLE>
TABLE OF CONTENTS

<S> <C>
PROSPECTUS SUMMARY 7
RISK FACTORS 8
SELLING SECURITY HOLDERS 12
SOURCE AND USE OF PROCEEDS 15
DILUTION 16
THE COMPANY 17
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION 21
MANAGEMENT 23
CERTAIN TRANSACTIONS 27
PRINCIPAL SHAREHOLDERS 30
SHARES ELIGIBLE FOR FUTURE SALE 33
MARKET FOR REGISTRANT'S COMMON EQUITY 33
TERMS OF THE OFFERING 34
DESCRIPTION OF SECURITIES 36
LEGAL MATTERS 37
LEGAL PROCEEDINGS 37
EXPERTS 37
INTERESTS OF NAMED EXPERTS AND COUNSEL 37
</TABLE>

<PAGE>6
PROSPECTUS SUMMARY

The following summary is qualified in its entirety by the more detailed
information, financial statements and notes to the financial statements
including the notes thereto appearing elsewhere in this Prospectus.

The Company was incorporated in Delaware on January 31, 1997. The
Company is authorized to issue Twenty Million (20,000,000) Common Shares,
$.001 par value. The Company is also authorized to issue Two Million Five
Hundred (2,500,000) Preferred Shares, $.001 par value. Pursuant to a
Special Meeting of the Shareholders held on July 22, 1997, the Company filed
an amendment to the Articles of Incorporation increasing the authorized
Common Shares of the Company to One Hundred Million (100,000,000).

The Company's executive offices are located at 1280 Hendersonville Road,
Asheville, NC 28803. These offices consist of 5700 square feet which are
leased on a three year lease basis beginning October, 1998 at the monthly
lease price of $5,462.50 which is terminable on a ninety day written notice.

Corporate Operations. The Company is a newly formed company, which currently
intends to acquire and operate barbecue restaurants to be known as
"Foxworthy's Smoke House Grill" or "Foxworthy's Bar-B-Q," The
Company intends initially to acquire existing barbecue restaurants for
conversion to one of the two restaurant concepts. The Company also intends
to market and distribute barbecue sauces and salsas under trademarks using
the "Foxworthy" name and may also, at a later time, distribute other food
products which are related to the restaurant menu.

Common Shares currently outstanding 11,258,991

Common Shares to be outstanding
after Offering (assuming exercise
of all warrants and options) 12,952,198

Percent of Common Shares owned by
current shareholders after
Offering (assuming exercise
of all warrants and options) 86.93%

Gross Proceeds After Maximum Offering
(assuming exercise of all warrants and
options) $3,297,818

Use of Proceeds This Prospectus relates to
securities being registered on
behalf of selling security
holders and the Company will not
receive any cash or other
proceeds from the sale. Any
proceeds received from the
subsequent exercise of the
warrants and options shall be
used as working capital, and to
expand operations. See "Source
and Use of Proceeds."

RESALES BY SELLING
SHAREHOLDERS. This Prospectus relates to
common Shares being registered
on behalf of selling security
holders. The Company will not
receive any cash or other
proceeds in connection with the
subsequent sale. The
Company is not selling any
Common Shares on behalf of
Selling Shareholders and has no
control or affect on these
Selling Shareholders. See
"Selling shareholders."

MARKET FOR COMMON STOCK
AND WARRANTS. Prior to the date hereof, there
has been only a limited trading
market for the Common Stock or
Warrants of the Company. The
Company's Common Stock is quoted
on the Electronic Bulletin Board
under the symbol "RDNK".

There can be no assurance
that an active trading and/or a
liquid market will develop or,
if developed, that it will be
maintained. See "Risk Factors"
and "Market Listing."

<PAGE>7

RISK FACTORS There are material risks, such
as uncertainty of future
financial results, liquidity
dependent on additional capital
and debt financing and risks
related to the restaurant
industry, in connection with the
purchase of the securities. See
"Risk Factors."

Absence of Dividends; Dividend Policy The Company does not currently
intend to pay regular cash
dividends on its Common Stock;
such policy will be reviewed by
the Company's Board of Directors
from time to time in light of,
among other things, the
Company's earnings and financial
position. The Company does not
anticipate paying dividends on
its Common Stock in the
foreseeable future. See "Risk
Factors."

Transfer Agent Florida Atlantic Stock Transfer
acts as the Company's Transfer
agent
</TABLE>

RISK FACTORS

In analyzing this offering, prospective investors should read this entire
Prospectus and carefully consider, among other things, the following Risk
Factors:

Limited Operating History and Uncertainty of Future Operating Results. The
Company has limited operating history and expects to incur losses and
administrative expenses until sales of its products commence and/or revenues
are received from any of its proposed restaurants. The Company believes
future operating results over both the short and long term will be subject to
annual and quarterly fluctuations due to several factors, some of which are
outside the control of the Company. These factors include fluctuating
market demand for the Company's restaurants and products, the quality of
products and restaurants, pricing, competitive products and general economic
conditions. See "Management's Discussion and Analysis of Financial
Condition."

The Restaurant and Food Industries and Competition. The restaurant and food
industries are highly competitive with respect to price, service, quality and
location and, as a result, has a high failure rate. There are numerous
well-established competitors, including national, regional and local
restaurant chains, possessing substantially greater financial, marketing,
personnel and other resources than the Company. Furthermore, to the extent
that barbecue restaurants are frequently viewed as "local", the Company may
experience intense competition or lack of consumer acceptance if it expands
into areas with existing barbecue restaurants. There can be no assurance
that the Company will be able to respond to various competitive factors
affecting the restaurant industry. The restaurant and food industries
are also generally affected by changes in consumer preferences, national,
regional and local economic conditions and demographic trends. The
performance of restaurant facilities may also be affected by factors such as
traffic patterns, demographic considerations and the type, number and
location of competing facilities. In addition, factors such as inflation,
increased labor and employee benefit costs, and a lack of availability of
experience management and hourly employees may also adversely affect the
restaurant and food industries in general and the Company's restaurants and
food products, in particular. Restaurant operating costs are further
affected by increases in the minimum hourly wage, unemployment tax rates and
similar matters over which the Company has no control. Finally, by the
nature of its business, the Company would be subject to potential liability
from serving contaminated or improperly prepared food.

Government Regulation. The restaurant and food product business is subject
to various federal, state and local government regulations, including those
relating to the sale of food and alcoholic beverages. The failure to
maintain food and liquor licenses would have a material adverse effect on the
Company's operating results. In addition, restaurant and food production
operating costs are affected by increases in the minimum hourly wage,
unemployment tax rates, sales taxes and similar costs over which the Company
has no control. Many of the Company's personnel will be paid at rates based
on the federal minimum wage. Recent increases in the minimum wage are not
expected to materially impact the Company's labor costs. The Company will
be subject to "dram shop" statutes in certain states which generally allow a
person injured by an intoxicated person to recover damages from an
establishment that served alcoholic beverages to such intoxicated person.
As appropriate, the Company shall seek to obtain liability insurance against
such potential liability.

<PAGE>8

Trademarks. The Company's ability to successfully implement its concept
will depend in part upon Jeff Foxworthy's ability to protect his
trademarks. Jeff Foxworthy will file a trademark application with the
United States Patent and Trademark Office to register the "Jeff Foxworthy's"
and "Foxworthy's" mark and design. There can be no assurance that Jeff
Foxworthy will be granted trademark registration for any or all of the
proposed uses in his proposed applications. In the event Jeff Foxworthy's
mark is granted registration, there can be no assurance that he can protect
such mark and design against prior users in areas where the Company conducts
operations. There is no assurance that Mr. Foxworthy and the Company will
be able to prevent competitors from using the same or similar marks, concepts
or appearance.

No Diversification. The Company operates in the sale of food products.
Therefore, the Company's financial viability will depend almost exclusively
on the Company's ability to generate revenues from its operation, and the
Company will not have the benefit of reducing its financial risks by relying
on revenues derived from other operations.

Additional Financing Will be Required. Even if all of the Warrants and
options registered on behalf of selling shareholders are exercised, the funds
available to the Company will not be adequate for its business activities.
Accordingly, the ultimate success of the Company will depend upon its
ability to raise additional capital or to have other parties bear a portion
of the required costs to further develop or exploit its business activities.
(See "Use of Proceeds" and "Business Activities.")

Limited Public Market. There is presently only a limited public market for
the Common Shares of the Company and there is no assurance that a public
market will ever develop. Consequently, investors will not be able to
liquidate their investment in the event of an emergency or for any other
reason.

Investors May Bear Risk of Loss. Capital required by the Company to
commence operations will be paid from the proceeds of this Offering.
Therefore, private investors of this Offering will bear most of the risk of
the Company's commencement of operations. Conversely, management stands to
realize benefits from the payment of salaries, expenses and receipt of stock
options regardless of the profitability of the Company.

Financial Condition. The Company needs to raise approximately $1,200,000 to
complete the acquisition of Woody's. Additionally, the Company needs working
capital for corporate expenditures of approximately $1,000,000 or more over
the next 12 months to fund the ongoing development of the Company's business
plan. Upon completion of the Woody's acquisition, the Company will have
completed its capital requirements for its operations development phase.
Additional capital may be required for future restaurant development and/or
future acquisitions that may become available. The Company intends to pursue
expansion by internal growth or acquisition, as capital and business
opportunities become available. There can be no assurance that this will in
fact occur or that the Company can be operated in a profitable manner.

Lack of Dividends. There can be no assurance that the operations of the
Company will become profitable. At the present time, the Company intends to
use any earnings which may be generated to finance the growth of the
Company's business. See "Description of Securities" and "Dividend Policy."

Dependence on Key Individuals. The future success of the Company is highly
dependent upon the Company's ability to attract and retain qualified key
employees. The Company has entered into a definitive employment agreement
with only one of the officers. The inability to attract and retain this
individuals and others for the long term would have a material impact upon
the business of the Company. See "Company - Employees" and "Management."

No Independent Market Research of Potential Demand for Current Operations.
No independent organization has conducted market research providing
management with independent assurance from which to estimate potential demand
for the Company's business operations. Even in the event market demand is
independently identified, there is no assurance the Company will be
successful. See "Management."

Vulnerability to Fluctuations in Economy. Demand for the Company's products
will be dependent on, among other things, general economic conditions which
are cyclical in nature. Prolonged recessionary periods may be damaging to
the Company.

Not a Tax Shelter. The Offering that is the subject of this Memorandum is
not a tax shelter. Any income received by the shareholders of the Company
will be taxed fully as dividend income.

Forward-Looking Statements and Associated Risk. This Prospectus, including
the information incorporated herein by reference, contains forward-looking
statements including statements regarding, among other items, the Company's
growth strategies, and anticipated trends in the Company's business and
demographics. These forward-looking statements are based largely on the
Company's expectations and are subject to a number of risks and
uncertainties, certain of which are beyond the Company's control. Actual
results could differ materially from these forward-looking statements as a

<PAGE>9

result of the factors described in this section "Risk Factors," including
among others, regulatory or economic influences. In light of these risks
and uncertainties, there can be no assurance that the forward-looking
information contained in this Prospectus will be accurate.

"Penny" Stock Regulation of Broker-Dealer Sales of Company Securities. The
Company's Common Stock is listed on the OTC Bulletin Board and on NASDAQ
Small Cap Market upon meeting the requirements for a NASDAQ listing, if ever.
Upon completion of this offering, the Company will not meet the requirements
for a NASDAQ Small Cap Market listing. The OTC Bulletin Board has no
quantitative written standards and is not connected with the NASD. Until
the Company obtains a listing on the NASDAQ Small Cap Market, if ever, the
Company's securities may be covered by a Rule 15g-9 under the Securities
Exchange Act of 1934 that imposes additional sales practice requirements on
broker-dealers who sell such securities to persons other than established
customers and institutional accredited investors (generally institutions with
assets in excess of $5,000,000 or individuals with net worth in excess of
$1,000,000 or annual income exceeding $200,000 or $300,000 jointly with their
spouse). For transactions covered by the rule, the broker-dealer must
furnish to all investors in penny stocks, a risk disclosure document required
by Rule 15g-9 of the Securities Exchange Act of 1934, make a special
suitability determination of the purchaser and have received the purchaser's
written agreement to the transaction prior to the sale. In order to approve
a person's account for transactions in penny stock, the broker or dealer must
(i) obtain information concerning the person's financial situation,
investment experience and investment objectives; (ii) reasonably determine,
based on the information required by paragraph (i) that transactions in penny
stock are suitable for the person and that the person has sufficient
knowledge and experience in financial matters that the person reasonably may
be expected to be capable of evaluating the rights of transactions in penny
stock; and (iii) deliver to the person a written statement setting forth the
basis on which the broker or dealer made the determination required by
paragraph (ii) in this section, stating in a highlighted format that it is
unlawful for the broker or dealer to effect a transaction in a designated
security subject to the provisions of paragraph (ii) of this section unless
the broker or dealer has received, prior to the transaction, a written
agreement to the transaction from the person; and stating in a highlighted
format immediately preceding the customer signature line that the broker or
dealer is required to provide the person with the written statement and the
person should not sign and return the written statement to the broker or
dealer if it does not accurately reflect the person's financial situation,
investment experience and investment objectives and obtain from the person a
manually signed and dated copy of the written statement. A penny stock
means any equity security other than a security (i) registered, or approved
for registration upon notice of issuance on a national securities exchange
that makes transaction reports available pursuant to 17 CFR 11Aa3-1 (ii)
authorized or approved for authorization upon notice of issuance, for
quotation in the NASDAQ system; (iii) that has a price of five dollars or
more or . . . . (iv) whose issuer has net tangible assets in excess of
$2,000,000 demonstrated by financial statements dated less than fifteen
months previously that the broker or dealer has reviewed and has a reasonable
basis to believe are true and complete in relation to the date of the
transaction with the person. Consequently, the rule may affect the ability
of broker-dealers to sell the Company's securities and also may affect the
ability of purchasers in this Offering to sell their shares in the secondary
market. See "Market for Registrant's Common Equity and Related Stockholder
Matters - Broker-Dealer Sales of Company's Securities."

SELLING SECURITY HOLDERS

The Company shall register pursuant to this prospectus 595,000 Common
Shares currently outstanding for the account of the following individuals or
entities. The percentage owned prior to and after the offering reflects all
of the then outstanding common shares. The amount and percentage owned
after the offering assumes the sale of all of the Common Shares being
registered on behalf of the selling shareholders.

<TABLE>
<CAPTION>
Name and Amount Total Number % Owned Number of % Owned
Being Registered Owned Prior to Shares Owned After
Currently Offering After Offering Offering
<S> <C> <C> <C> <C>

Ray E. Justice, Sr. 185,000 1.643% 0 0%
Robert A. Baydale 160,000 1.421% 0 0%
Scott and Debrah Miller 25,000 .222% 0 0%
William Moon 15,000 .133% 0 0%
Yolanda Mills 105,000 .933% 0 0%
James Mills 105,000 .933% 0 0%
</TABLE>

The Company shall register pursuant to this prospectus the 510,000 Common
Shares underlying the Warrants currently outstanding for the account
of the following individuals or entities. The percentage owned prior to and
after the offering reflects all of the then outstanding Warrants.
The amount and percentage owned after the offering assumes the exercise of
all of the Warrants and sale of underlying Common Shares being
registered on behalf of the selling shareholders.

<PAGE>10

<TABLE>
<CAPTION>
Name and Amount Total Number % Owned Number of % Owned
Being Registered Owned Prior to Warrants Owned After
Currently Offering After Offering Offering
<S> <C> <C> <C> <C>

Jack Augsback 255,000 50% 0 0%
Sovereign Capital 255,000 50% 0 0%
</TABLE>

The Company shall register pursuant to this prospectus the 80,000 Common
Shares underlying the options currently outstanding for the account
of the following individuals or entities. The percentage owned prior to and
after the offering reflects all of the then outstanding options.
The amount and percentage owned after the offering assumes the exercise of
all of the options and sale of underlying Common Shares being
registered on behalf of the selling shareholders.

<TABLE>
<CAPTION>
Name and Amount Total Number % Owned Number of % Owned
Being Registered Owned Prior to Options Owned After
Currently Offering After Offering Offering
<S> <C> <C> <C> <C>

Becky Grier 30,000 1.778% 0 0%

The Company shall register pursuant to this prospectus the 558,207 Common
Shares underlying the Convertible Debentures currently outstanding for the
account of the following individuals or entities. The percentage owned prior
to and after the offering reflects all of the then outstanding convertible
debentures. The amount and percentage owned after the offering assumes the
exercise of all of the Convertible Debentures and sale of underlying Common
Shares being registered on behalf of the selling shareholders.

</TABLE>
<TABLE>
<CAPTION> Number of
Name and Amount Total Number % Owned convertible % Owned
Being Registered Owned Prior to Debentures Owned After
Currently Offering After Offering Offering
<S> <C> <C> <C> <C>

Sergio Bonnetti 43,781 7.842% 0 0%
Aldo Nenzi 87,562 15,686% 0 0%
Cornelius International, Ltd. 43,781 7,842% 0 0%
Arab Commerce Bank Ltd. 54,726 9.803% 0 0%
Robert Rabin 21,890 3.921% 0 0%
Sandro Grimaldi 65,672 11.768% 0 0%
Oscar Brito 65,672 11.768% 0 0%
Galapaco Holdings Limited 109,452 19.607% 0 0%
Allouros Ltd. 21,890 3.921% 0 0%
Muzzolon Piermario 43,781 7.842% 0 0%

- --------------------------------------------------------------
SOURCE AND USE OF PROCEEDS
- --------------------------------------------------------------

Securities are being registered on behalf of the selling security holders and
the Company will not receive any cash or other proceeds in connection with
the subsequent sale.

Any proceeds received from the subsequent exercise of the Warrants
and Options shall be used as working capital and to expand operations. Due
to the uncertainty of the timing and amount of actual funds which may be
received upon exercise of the Warrants or Options, no specific breakdown of
uses have been established by the Company. The aggregate amount of
proceeds if all of the Warrants and Options are exercised is $1,279,068. If
all of the Warrants and/or Options are exercised, the proceeds shall be
utilized over a two year period.

- -------------------------------------------------------
THE COMPANY
- -------------------------------------------------------

<PAGE>11

There are presently outstanding 11,258,991 Common Shares.

License Agreement. On February 4, 1997, the Company entered into a
license agreement with Jeff Foxworthy whereby Mr. Foxworthy licensed the use
of his name and likeness. In consideration for the license agreement, the
Company issued 2,500,000 of its Series A Preferred Stock under the terms of a
Stock Purchase Agreement. The term of the license agreement is 50 years
unless sooner terminated by the occurrence of any of the following:

a. a material breach by the Company of the license agreement,
the Stock Purchase Agreement or any of the transaction documents, if the
breach is not cured within 30 days of receipt from Foxworthy of written
notice thereof.
b. at the option of Foxworthy, upon a material breach by David
Womick of his obligations under Mr. Womick's employment agreement within the
first three years after opening of the first restaurant, which breach has
not been cured within 30 days of receipt from Foxworthy of written notice
thereof.
c. Upon receipt of written notice from Foxworthy in the event
the Company commits any act or omission, is subject to any claim or
occurrence or is involved in any circumstances that would cause the continued
association of the Company with the licensed material to be detrimental to
the value of the licensed material or to Mr. Foxworthy's image or reputation
as determined by Foxworthy in his sole and absolute discretion.

d. The failure of the Company to continually operate the
restaurants and manage the franchise according to the policies, practices and
standards agreed to by the parties pursuant to the terms of the Stock
Purchase Agreement.

e. The failure of the Company and/or Mr. Womick to raise the
Investment Capital, on or before June 30, 1998, and otherwise pursuant to the
terms provided in the Stock Purchase Agreement; or

f. The failure of the Company to comply with any laws and
regulations, the consequences of which are materially adverse to the Company.

As of June 7, 1998, the Investment Capital had been raised and Mr.
Foxworthy's Series A Convertible Preferred Stock was automatically converted
to Common Shares as per the Series A Convertible Stock Purchase Agreement.

Upon termination or expiration of the License Agreement, all license rights
granted to the Company shall terminate and the Company shall immediately
thereafter discontinue all use of the licensed material. Mr. Foxworthy
shall have the right to purchase any inventory of the licensed products in
the Company's possession as of the date of termination. If Mr. Foxworthy
does not purchase all of the Company's existing inventory of the licensed
products, then not withstanding the termination of the license agreement, the
Company shall have the right ot continue to use the licensed material in
connection with the advertisement, distribution, and sale of its existing
inventory of licensed products for a period of 120 days after termination,
provided that such advertisement, distribution and sale is done only by means
of and through then-existing distribution channels and in all other respects
in accordance with all the terms and conditions contained in the license
agreement.

Development of Corporate Owned Restaurants. The Company intends to develop a
chain of corporate owned restaurants under the name of "Foxworthy's Smoke
House Grill" or "Foxworthy's Bar-B-Q."

Implementation of Restaurant Franchising Program. The Company intends to
build additional corporate owned restaurants and develop and implement a
restaurant franchising program on a nationwide basis.

Acquisition of Existing Barbecue Restaurants. The Company intends to
acquire existing barbecue restaurants for conversion to either "Foxworthy's
Smoke House Grill" or "Foxworthy's Bar-B-Q" concepts.

In March, 1998, the Company paid an escrow deposit of $25,000 in connection
with negotiations with Woody's Bar-B-Q, a barbecue restaurant chain of seven
company operated and twenty-six franchised barbecue restaurants in
Jacksonville, Florida which the Company was seeking to acquire. The
Company forfeited the escrow deposit when the agreement terminated without
being consummated.

<PAGE>12

The agreement has been verbally extended while the parties finalize
negotiations regarding the purchase by the Company of a percentage interest
in Woody's equal to the cash the Company has already delivered to the Woody's
shareholders and negotiations of a management agreement based upon the
parties desire to have the Company manage the affairs of Woody's until the
final closing can occur.

The Company continues to seek possible restaurant acquisition candidates as
per the Company's business plan, although it has not executed any definitive
agreements to acquire any business other than Woody's Bar-B-Q and the
restaurant to be acquired from the joint venture.

Products. The Company's sauces will be produced and marketed under the
"Jeff Foxworthy's Bar-B-Q Sauce" brand. The first three sauces
are:

Original Redneck. An original mild tomato and molasses based sauce.
Redneck Hot. A hot spicier version of "Original Redneck" sauce.
Tangy Mustard. A tangy mustard based sauce that was developed to be
used as a barbecue sauce, salad dressing and a dipping sauce.

The Company has entered into an agreement with PicNik Foods, Inc. located in
Montgomery, Alabama to manufacture these sauces. It is believed that this
manufacturer has sufficient capacity to process, pack and ship the
anticipated sales volume of the sauces. Other manufacturers are available to
manufacture the sauces, if needed.

The Company has determined the retail and wholesale prices of its products,
however, the prices vary from store to store.

The Company has retained food brokers to assist the Company in the
development and distribution of products expected to be developed that are
related to the menu and concept.

Marketing. The Company shall rely primarily on print, television and radio
advertising along with sampling at retail outlets to initially attract
customers to buy its products and, in the future, to eat at its restaurants.
The Company may also use distinctive exterior signage and off-site
billboards.

Promotion Agreement. On February 4, 1997, the Company entered into a
promotion agreement with Jeff Foxworthy whereby the Mr. Foxworthy will
provide the Company with certain promotional appearances and services. For
a period of five years, Mr. Foxworthy agrees to serve, without charge, but
subject to applicable union and guild minimums, as the feature actor in four
commercials per year promoting the restaurants and the franchise. The
commercials may be aired on local or national television or radio or both.
During the term of the agreement, Mr. Foxworthy shall not directly or
indirectly provide promotional appearances or services to any business which
competes with the Company's business of owning and managing restaurants that
feature barbecue style as their primary cuisine and marketing and selling
barbecue-related food products. The promotion agreement has the same
termination features as the License Agreement discussed above.

Consulting Agreement. On February 4, 1997, the Company entered into a
consulting agreement with J.P. Williams to provide the Company with
consulting advice and services with respect to the promotion and
merchandising of the Company's proposed restaurants and the food products of
the Company. The Company pays J. P. Williams an annual consulting fee
of $10,000, as a base fee. In addition to the base fee plus reasonable
expenses, J.P. Williams may be entitled to a potential bonus, the amount of
which, if any, shall be determined by the Board of Directors of the Company,
in its sole and absolute discretion.

Additionally, Mr. Williams has been granted options to acquire 540,000 shares
of common stock of the Company. Mr. William's interest in such options shall
vest in equal monthly installments on the first day of each month over the
three year term of the consulting agreement. The options expire ten years
from the date of the grant.

Distribution. The Company's products are specifically designed for national
distribution through grocery stores, gift shops, discount outlets and
restaurants.

Buyer-Broker Agreement. On April 16, 1997, the Company entered into a
Buyer-Broker agreement with Business Intermediary Services, Ltd., a business
controlled by Mr. Erich Schmid, a director of the Company, to locate
businesses or properties to be purchased by the Company. The term of the
agreement is twenty four (24) months. Pursuant to the Buyer-Broker
Agreement, the Company shall pay an accomplishment fee based on a percentage
of the total purchase price paid by the Company. The accomplishment fee
structure is:

5% of total purchase price up to $1,000,000; plus
4% of total purchase price between $1,000,000 and $2,000,000; plus
3% of total purchase price between $2,000,000 and $3,000,000; plus
2% of total purchase price between $3,000,000 and $4,000,000; plus
1% of total purchase price in excess of $4,000,000.

<PAGE>13

Pursuant to this agreement, the Company paid Business Intermediary Services,
Ltd. $30,000 on February 16, 1998 in connection with the acquisition of the
Asheville, North Carolina restaurant. Additionally, Business Intermediary
Services, Ltd. will be entitled to a fee in the event the acquisition of
Woody's Bar-B-Q, Inc. is consummated.

Stock Purchase Letter Agreement. On September 11, 1998, the Company
obtained an extension relating to its ongoing negotiations to
acquire all of the stock of Woody's Bar-B-Q Holdings, Inc., a 33-
unit chain based in Jacksonville Florida. To obtain this extension,
the Company agreed to release to the selling shareholders of Woody's
$870,930, representing the net funds held in escrow at that time.
The Company expects to pay a total of $2,000,000 in cash plus
approximately $3,400,000 of Convertible Promissory Notes (the
"Notes") bearing interest at 10% and maturing in one year. The
final purchase price is subject to adjustment based upon a closing
balance sheet audit. The Notes are convertible into Common Stock
at the lower of $2.93 per Common Share or the average daily closing
prices for the 30 days prior to conversion. Additionally, the
Company will issue Warrants to the Selling Shareholders to acquire
500,000 shares of the Company's Common Stock at the lower of $1.71
(the bid price of the Company's Common Stock on September 24, 1998, the date
a further extension was executed) or the Conversion Price identified in the
Notes. Mr. David Womick, President of Redneck Foods, Inc., and his wife
have also agreed to guarantee the Notes and they have agreed to pledge
1,000,000 of their Redneck Common Shares as additional collateral. The
Company and the Sellers extended the closing 3 times until October 8, 1998
to facilitate the raising of the necessary capital to close the
transaction. The agreement has been verbally extended while the parties
finalize negotiations regarding the purchase by the Company of a percentage
interest in Woody's equal to the cash the Company has already delivered to
the Woody's shareholders and negotiations of a management agreement based
upon the parties desire to have the Company manage the affairs of Woody's
until the final closing can occur.

The Company is attempting to raise the required cash through a
private placement of convertible debentures. The Company
authorized up to $3,000,000 in aggregate principal amount of Series
1 Secured Convertible Debentures Due 2001 (the "Debentures"). The
Debentures bear interest at 5% per annum, payable quarterly, and are
redeemable at 125% of the principal amount so redeemed. Subsequent
to June 30, 1998, $1,275,000 in Debentures has been sold.

Joint Venture Agreement. The Company has entered into a joint venture with
Pigs"R"Us, Inc., a Florida corporation to be called Redneck Pigs Joint
Venture 1. The sole purpose of the joint venture is to create a single
barbecue restaurant on property under lease by Pigs"R"Us. The parties
agreed to convert the venture into a limited liability company as soon as
practicable and to jointly plan, operate and own the pilot restaurant. The
Company will sublicense to the venture certain rights under its license
agreement and contribute capital. The Company has contributed $50,000 to
this joint venture. No additional contributions will be made under the
current agreement. The Company will own a 10% interest in the venture. The
Company shall be paid a consulting fee of 3% of gross sales in addition to
its available distributions based on its ownership interest. Certain
options and rights for both parties in the joint venture are established by
the contractual agreement. The Company plans to acquire the remaining
interest in the joint venture in the fourth quarter of 1998 pursuant to an
agreement with the joint venture partner whereby shares of Common Stock will
be issued after the completion of an audit. The Company has agreed to
manage the operations until the final audit is complete.

Dependence on One or a Few Major Customers. The Company does not expect
that any single customer will account for more than ten percent of its
business.

The Company is a newly formed company, which currently intends to acquire and
operate barbecue restaurants to be known as "Foxworthy's Smoke House Grill"
or "Foxworthy's Bar-B-Q," The Company intends initially to acquire
existing barbecue restaurants for conversion to one of the two restaurant
concepts. The Company also intends to market and distribute barbecue
sauces and salsas under trademarks using the "Foxworthy" name and may also,
at a later time, distribute other food products which are related to the
restaurant menu.

In February, 1998, the Company entered into a contract to acquire the real
estate, the equipment and leasehold interest of a barbecue restaurant in
Asheville, North Carolina to be connected to a Foxworthy's Smoke House Grill.
The Company did not acquire the operating business of the restaurant. The
Company issued 223,333 shares of Common Stock valued at $3.00 per Common
Share for the equipment and the leasehold interest and has contracted to
acquire the real estate for $550,000 in cash. A deposit of $42,352 has been
paid against the purchase price and the Company expects to close on the real
estate in the first quarter of 1999.

Research and Development. The Company has expended in excess of $61,700
for research and development activities. These amounts include $35,000 in
consulting expense and $26,700 in contract services. In the future, the
Company anticipates that a portion of the proceeds from this offering will be
used to conduct additional research and development activities.

<PAGE>14

Competition. The restaurant and food product industries are highly
competitive with respect to price, service, quality and location and, as a
result, has a high failure rate. There are numerous well-established
competitors, including national, regional and local restaurant chains,
possessing substantially greater financial, marketing, personnel and other
resources than the Company. Furthermore, to the extent that barbecue
restaurants are frequently viewed as "local", the Company may experience
intense competition or lack of consumer acceptance if it expands into areas
with existing barbecue restaurants. There can be no assurance that the
Company will be able to respond to various competitive factors affecting the
restaurant industry. The restaurant and food industries are also
generally affected by changes in consumer preferences, national, regional and
local economic conditions and demographic trends. The performance of
restaurant facilities may also be affected by factors such as traffic
patterns, demographic considerations and the type, number and location of
competing facilities. In addition, factors such as inflation, increased
labor and employee benefit costs, and a lack of availability of experience
management and hourly employees may also adversely affect the restaurant and
food industries in general and the Company's restaurants and food products,
in particular. Restaurant operating costs are further affected by increases
in the minimum hourly wage, unemployment tax rates and similar matters over
which the Company has no control. Finally, by the nature of its business,
the Company would be subject to potential liability from serving contaminated
or improperly prepared food.

Employees. The Company employs thirteen full time persons. The Company
shall employ additional individuals as required.

Governmental Regulation. The restaurant and food product business is
subject to various federal, state and local government regulations, including
those relating to sanitation, safety, fire and the sale of food and alcoholic
beverages. The failure to maintain food and liquor licenses would have a
material adverse effect on the Company's operating results. In addition,
restaurant and food production operating costs are affected by increases in
the minimum hourly wage, unemployment tax rates, sales taxes and similar
costs over which the Company has no control. Many of the Company's
personnel will be paid at rates based on the federal minimum wage. Recent
increases in the minimum wage are not expected to materially impact the
Company's labor costs. The Company will be subject to "dram shop" statutes
in certain states which generally allow a person injured by an intoxicated
person to recover damages from an establishment that served alcoholic
beverages to such intoxicated person. As appropriate, the Company shall
seek to obtain liability insurance against such potential liability.

The Federal Americans With Disabilities Act prohibits discrimination on basis
of disability in public accommodations and employment. The Company could be
required to expend funds to modify its restaurants in order to provide
service to or make reasonable accommodations for disabled persons.

The Company will be subject to environmental rules, particularly with respect
to preventing water pollution. The Company plans to recycle cooking grease
to prevent water pollution.

Seasonal Nature of Business Activities. The Company's business activities
are not seasonal.

- ---------------------------------------------------------
MANAGEMENT
- ---------------------------------------------------------

Board of Directors. The following persons listed below have been retained to
provide services as director until the qualification and election of his
successor. All holders of Common Stock will have the right to vote for
Directors of the Company. The Board of Directors has primary responsibility
for adopting and reviewing implementation of the business plan of the
Company, supervising the development business plan, review of the officers'
performance of specific business functions. The Board is responsible for
monitoring management, and from time to time, to revise the strategic and
operational plans of the Company. Directors receive no cash compensation
or fees for their services rendered in such capacity, however, the Board of
Directors, in June 1997, gave Mr. Eskew and Mr. Scheifley 100,000 Common
Shares each, valued at $.10 per Common Shares for their previous services as
directors.

Pursuant to the Company's charter and By-Laws, Mr. Womick, Mr. Williams and
Mr. Fox were elected for a two year term on July 9, 1998. Mr. Schmid and Mr.
Scheifley were elected for a one year term on July 9, 1998.

The Executive Officers and Directors are:

Name Position Term(s) of Office

David A. Womick, age 43 President Inception to
and Director present

John P. Williams, age 32 Director Inception
to present

<PAGE>15

Erich K. Schmid, age 52 Director Inception to
present

Samuel J. Fox, age 53 Director December 5, 1997
to present

James E. Scheifley, age 49 Secretary April 11, 1998
Treasurer Feb., 1997
Director to present

Resumes:

David A. Womick. Mr. Womick has been President of the Company since
inception. Mr. Womick intends to dedicate at least 90% of his work time to
the affairs of the Company. Mr. Womick was a Director of Restaurant Services
by Arby's International from 1978 to 1982. From 1982 to 1988, Mr. Womick
has been a franchise area developer owning thirteen Arby's, six Denny's and
three Del Taco restaurants. From 1988 to 1995, Mr. Womick pursued his
personal investments including, but not limited to, reviewing a wide variety
of restaurant concepts that could be developed into a chain format. From 1995
to October, 1997, Mr. Womick was President of KRR Nashonooga, Inc., KRR
Knoxville, Inc., KRR Tri-cities, Inc. and Atlanta Foodquest, Inc.,
franchisees of Kenny Rogers Roasters restaurants. Mr. Womick earned a
Bachelor of Applied Science in social science from Elon College in 1976.

John P. Williams. From 1991 to present, Mr. Williams has been Chief
Executive Officer of Parallel Entertainment, a personal management company.
In addition to Jeff Foxworthy, Mr. Williams manages Bill Engvall, Megan
Cavanagh and Chris Spencer. Mr. Williams has been involved in the
entertainment industry since 1983 and has represented talent such as Jay
Leno, Jerry Seinfeld, Damon Wayans, David Alan Grier, Dennis Miller, Jamie
Foxx and others.

Erich K. Schmid. From 1994 to present, Mr. Schmid has been President of
Business Intermediary Services, Ltd., a business brokerage firm he co-founded
specializing in middle-market transactions. From 1985 to 1994, Mr. Schmid
was a Vice President with New South Business Ventures, Inc. and its
predecessor T.C. Wilkinson, Jr. & Associates, Inc., general business
brokerage firms. He is a member of the International Business Brokers
Association, Inc. and is a Certified Business Intermediary. Mr. Schmid
earned a Bachelor of Science in industrial management and a Master of Science
in management from the University of Akron in 1971 and 1996, respectively.

James E. Scheifley. Mr. Scheifley has over 25 years experience in
corporate and public accounting. He is the president and majority
shareholder of James E. Scheifley & Associates, P.C. a Morrison, Colorado
CPA firm which specializes in auditing and financial reporting for emerging
companies that are required to file information with the US Securities &
Exchange Commission. Mr. Scheifley co-founded the firm in 1982. He is a
member of the American Institute of Certified Public Accountants and the
Colorado Society of Certified Public Accountants. Mr. Scheifley received a
Bachelor of Science degree in accounting from La Salle University,
Philadelphia, Pennsylvania in 1969. He was formerly employed as an audit
manager with Coopers & Lybrand and has served as controller or vice-president
of finance for three public companies.

Samuel Fox. Mr. Fox is of counsel to the law firm of Blanc Williams
Johnston & Kronstradt, a Los Angeles law firm representing companies and
individuals in the entertainment, business and intellectual property areas.
His specialization includes entertainment law and licensing and he has been
personal counsel to Jeff Foxworthy for several years. He is a member of the
California and New York bars. Mr. Fox received a Bachelor of Arts degree
from Cornell University School of Law in 1969.

EXECUTIVE COMPENSATION

Remuneration. The Company has entered into an employment agreement with
David Womick for a term of five years. Pursuant to the agreement, Mr.
Womick serves as Chief Executive Officer. Mr. Womick shall receive an
annualized base salary of $150,000 and may be entitled to a potential bonus
of up to $100,000, the exact amount of which, if any, shall be determined by
the Board of Directors in its sole and absolute discretion. Mr. Womick was
not entitled to receive any salary or bonus until such time as the Company
has successfully obtained all of the $2,500,000 investment capital discussed
in Section 5.1(a) of the Stock Purchase Agreement. Mr. Womick's salary began
to accrue effective July 22, 1997.

Pursuant to the Employment Agreement, Mr. Womick agreed that 1,700,000 of the
5,100,000 Common Shares currently beneficially owned by Mr. Womick are
subject to forfeiture only upon an early termination of the Employment
Agreement that is caused by a breach of such agreement by Mr. Womick. The
number of shares subject to forfeiture shall be reduced 47,222 shares
monthly, on the first day of each month, over the first 3 years of the
Employment Agreement. Mr. Womick's interest in the Common Shares shall
fully vest and no longer be subject to forfeiture upon an change of control
of the Company.

The Company had entered into an employment agreement with prior vice
president, Al Sneeden for a term of three years. Pursuant to the agreement,
Mr. Sneeden received 108,000 Common Shares and was paid $68,536.92 prior to

<PAGE>16

termination. The agreement was terminated by the Company on April 10, 1998.
The Company had entered into an employment agreement with prior secretary and
chief counsel, E. Joseph Fitzpatrick, Jr. for a term of three years beginning
June 1, 1997. Pursuant to the agreement, Mr. Fitzpatrick received 108,000
Common Shares and was paid $57,461.59 prior to termination. The
agreement was terminated by the Company on April 10, 1998.

All salaries have been expensed in the appropriate financial statements.

Board of Directors Compensation. Members of the Board of Directors may
receive an amount yet to be determined annually for their participation and
will be required to attend a minimum of four meetings per fiscal year. To
date, the Company has paid $15,001 in directors' expenses. Additionally, Mr.
Scheifley and Mr. Eskew each received 100,000 Common Shares. Pursuant to a
Board of Directors vote on March 23, 1998, Mr. Samuel Fox was granted an
option to purchase 250,000 Common Shares at a price of $.85 per Common Share,
a discount from the $1.00 per Common Share value used for the other directors.
The discount is being expensed over his term as a director. All expenses for
meeting attendance or out of pocket expenses connected directly with their
Board representation will be reimbursed by the Company. Director liability
insurance may be provided to all members of the Board of Directors.

- ------------------------------------------------------
CERTAIN TRANSACTIONS
- ------------------------------------------------------

Stock Purchase Agreement. On February 4, 1997, the Company and David
Womick, an officer and director of the Company entered into a Stock Purchase
Agreement with Jeff Foxworthy. The Stock Purchase Agreement was negotiated
between the parties on an arm's length basis. Based on those independent
negotiations which were held during the early formation stages of the
Company, Mr. Foxworthy purchase 2,500,000 Series A Convertible Preferred
Shares for the consideration of entering into the License Agreement and
Promotion Agreement which included an agreement to provide promotional
services valued by Mr. Foxworthy's agent at $50,000. Mr. Foxworthy has only
provided services in accordance with his Promotional Agreement. The
2,500,000 Series A Convertible Preferred Shares (and underlying Common
Shares) had registration rights.

Pursuant to the Stock Purchase Agreement, as a condition subsequent to the
obligations of Mr. Foxworthy, the Company and Mr. Womick are obligated to
obtain equity investments in the Company totaling at least $2,500,000 in
gross capital less applicable, reasonable commissions from third party
investors by November 1, 1997. This date was verbally extended until
March 1, 1998 and subsequently verbally extended June 30, 1998. As of June
7, 1998, the Investment Capital has been raised and the Company elected to
automatically convert the Series A Convertible Preferred Shares into Common
Shares in accordance with the terms of the Stock Purchase Agreement.
Accordingly, 2,904,722 Common Shares were issued to Mr. Foxworthy. As with
the Series A Convertible Preferred Shares, 968,241 Common Shares are subject
to forfeiture, which number will be reduced by 16,137 Common Shares monthly
on the first day of the month over the five year term of the Promotion
Agreement. At September 27, 1998, 645,501 Common Shares remained subject to
forfeiture. Mr. Foxworthy's interest in the Common Shares shall fully vest
and no longer be subject to forfeiture upon a change of control of the
Company.

Contractual Obligations. The Company has entered into a consulting contract
with Shannon/Rosenblum (an unaffiliated entity) to provide services relating
to the capitalization and promotion of the Company. Shannon/Rosenblum was
issued 500,000 Common Shares as payment for these services.

The Company has entered into a consulting agreement with Little Pond
Enterprises, Inc. ("Little Pond") to assist the Company in its capitalization
and the obtainment of additional financing. As partial payment for
consulting services, the Company issued Little Pond 300,000 Common Shares.
Additionally pursuant to the consulting agreement, 200,000 Common Shares were
issued Erich Schmid, who subsequently became a director of the Company. In
addition, Little Pond received cash compensation of $20,000.

- ----------------------------------------------------------------
PRINCIPAL SHAREHOLDERS
- ----------------------------------------------------------------
The following tabulates holdings of shares of the Company by each person who,
subject to the above, at the date of this prospectus, holds of record or is
known by Management to own beneficially more than 5.0% of the Common Shares
and, in addition, by all directors and officers of the Company individually
and as a group. Each named beneficial owner has sole voting and investment
power with respect to the shares set forth opposite his name.

<PAGE>17

Shareholdings at Date of
This Prospectus

</TABLE>
<TABLE>
<CAPTION>
Percentage of
Number & Class(1) Outstanding
Name and Address of Shares Common Shares

<S> <C> <C>
David Womick(1)(2) 4,382,500(I) 38.93%
7 Stuyvesant 1,550,000(D) 13.77%
Asheville, NC 28803

Therese R. Womick(1)(2) 2,832,500 25.41%
7 Stuyvesant
Asheville, NC 28803

John P. Williams(3) 0 0%
c/o Parallel Entertainment
8380 Melrose Avenue, Suite 310
Los Angeles, CA 90069

Erich K. and Marilyn K. Schmid 200,000 1.76%
40 Spring Hollow Lane
Fairview, NC 28730

James E. Scheifley 100,000 .88%
7436 Settlers Drive
Morrison, CO 80465

Samuel J. Fox 0 0%
c/o Blanc Williams
Johnston & Kronstadt, LLP
1900 Avenue of the Stars,
17th Floor
Los Angeles, CA 90067-4403

Jeffrey Foxworthy(4) 2,904,722 25.80%
c/o Robert H. Bertstein
Bernstein & Bernstein
23901 Calabasas Road, Suite 1065
Calabasas, CA 91302

All Directors & Officers 5,400,000 47.90%
as a group (5 persons)
</TABLE>

(1)Pursuant to Rule 13d-3 under the Securities Exchange Act of 1934, as
amended, beneficial ownership of a security consists of sole or shared voting
power (including the power to vote or direct the voting) and/or sole or
shared investment power (including the power to dispose or direct the
disposition) with respect to a security whether through a contract,
arrangement, understanding, relationship or otherwise. Unless otherwise
indicated, each person indicated above has sole power to vote, or dispose or
direct the disposition of all shares beneficially owned, subject to
applicable unity property laws.

(2)Theresa R. Womick is married to David Womick, President and Director of
the Company. Mr. Womick would be deemed to be the beneficial owner of the
Common Shares held by Theresa R. Womick. Mr. Womick has given substantially
all of his non-forfeitable Common Shares received pursuant to his employment
contract to his wife. He further intends to give her additional shares as
they become non-forfeitable. Mr. Womick further disclaims any interest in
the shares held by Teresa R. Womick

(3)As further described below, Mr. Williams has 540,000 options to purchase
540,000 Common Shares of the Company. If the options are exercised, Mr.
Williams would own, on a fully diluted basis, 4.49% of the Company's Common
Shares.

(4)The 2,500,000 Class A Convertible Preferred Shares originally issued to
Jeffrey M. Foxworthy have been converted to Common Shares. As of September 27,
1998, 645,501 Common Shares remained forfeitable pursuant to the Stock
Purchase Agreement.

There are currently 1,687,500 options granted and outstanding. Except as
noted below, all options are 100% vested.

<TABLE>
<CAPTION>
<S> <C> <C> <C>
Name and address Stock options Exercise Price Expiration Date

John P. Williams(1) 540,000 $.50 December 31, 2007
c/o Parallel Entertainment
8380 Melrose Avenue, Suite 310
Los Angeles, CA 90069

<PAGE>18

Gary Nuell 5,000 $1.00 July 13, 1999
c/o AirPlay
5055 Wilshire Blvd.
6th Floor
Los Angeles, CA 90036

Becky Grier 30,000 $1.00 September, 2000
PLS, Inc.
P.O. Box 6065
Greenville, SC 29606

Bob Bernstein 50,000 $1.00 July 1999
23901 Calabasas Road
Suite 1065
Calabasas, CA 91302

Samuel J. Fox(1) 250,000 $.85 December 2002
c/o Blanc Williams
Johnston & Kronstadt, LLP
1900 Avenue of the Stars,
17th Floor
Los Angeles, CA 90067-4403

The Wall Street Group 50,000 $2.50 June 2003
32 E. 57th Street
New York, NY 10022

OTC Communications Corp. 100,000 $3.00 May 2002
1040 Great Plan Avenue
Needham, MA 02192

Jay Foxworthy 125,000 $1.96(3) February 2003
High Cotton
808-B Pickens Industrial Drive
Marietta, GA 30062

Children of the Night 10,000 $1.96(3) February 2003
c/o Blanc Williams
Johnston & Kronstadt, LLP
1900 Avenue of the Stars,
17th Floor
Los Angeles, CA 90067-4403

Duke University 100,000 $1.96(3) February 2003
Durham, NC 27708

Diabetes Research Institute 40,000 $1.96(3) February 2003
Foundation, Inc.
3440 Hollywood Boulevard, Suite 100
Hollywood, FL 33021

Bob Baydale 160,000 $2.65 March 31, 2001
841 Little Leaf Court
Orlando, FL 32835

John R. Geise 10,000 $2.55 May 27, 2001
Highway 61 N.E.
Lancaster, WI 53813

Fred Glaser 40,000 $2.65 March 31, 2001
5715 Major Boulevard
Orlando, FL 32819

Ray E. Justice, Sr. 160,000 $2.65 May 5, 2001
3421 Dogwood Drive
Hapeville, GA 30354

Jim Kemps 5,000 $2.55 May 27, 2001
417 Golf View Lane
Lancaster, WI 53813

Charlotte Lagman 2,500 $2.55 May 27, 2001
1380 Country Club Court
Platville, WI 53818

Les Mack 10,000 $2.55 May 27, 2001
617 Carleton Drive
Lancaster, WI 53813

(1)The options granted to Mr. Williams in connection with his consulting
agreement were to have been issued in February 1997. However, it was
determined that the exercise price was incorrectly described in the
agreement. When the mistake was detected, the Board of Directors agreed to
modify the original option to more accurately reflect the intent of the
parties to the agreement. Although the options were effective July 22,
1997, the option price was based on a value that more closely approximated
the value of the shares at the time of the original agreement and was in fact
in excess of the valuation assigned in February 1997 which was $.10 per
share.

<PAGE>19

The options issued to Mr. Williams vest at the rate of 15,000 per month. At
September 27, 1998, 225,000 options were vested.

(2)The options granted to Mr. Fox were at a discount of the then market price
of $1.00 per Common Share. The difference is being expensed over the term
of Mr. Fox's services as a director.

(3)Granted at 85% of the then market price of $2.31 per Common Share.

- ----------------------------------------------------------
SHARES ELIGIBLE FOR FUTURE SALE
- ----------------------------------------------------------

The Company currently has 11,258,991 shares of Common Stock outstanding.
Other securities that may be issued, in the future, in private transactions
pursuant to an exemption from the Securities Act are "restricted securities"
and may be sold in compliance with Rule 144 adopted under the Securities Act
of 1933, as amended. Rule 144 provides, in essence, that a person who has
held restricted securities for a period of one year may sell every three
months in a brokerage transaction or with a market maker an amount equal to
the greater of 1% of the Company's outstanding shares or the average weekly
trading volume, if any, of the shares during the four calendar weeks
preceding the sale. The amount of "restricted securities" which a person who
is not an affiliate of the Company may sell is not so limited.
Nonaffiliates may each sell without limitation shares held for three years.
The Company will make application for the listing of its Shares in the over-
the-counter market. Sales under Rule 144 may, in the future, depress the
price of the Company's Shares in the over-the-counter market, should a market
develop. Prior to this offering, there has been only a limited market for
the Common Stock of the Company. The effect, if any, of a public trading
market or the availability of shares for sale at prevailing market prices
cannot be predicted. Nevertheless, sales of substantial amounts of shares
in the public market could adversely effect prevailing market prices.

- ----------------------------------------------------------
MARKET FOR REGISTRANT'S COMMON EQUITY AND
RELATED STOCKHOLDER MATTERS
- ----------------------------------------------------------

The Company's common stock is traded in the over-the-counter market and
listed on the NASDAQ Bulletin Board under the symbol "RDNK.

The following table sets forth the range of high and low bid quotations
for the Company's common stock for each quarter since commencement of
trading (December 1997, as reported by the OTC Bulletin Board. The
Company's market makers are Olsen Payne, Hill, Thompson, Magib & Co.;
Paragon; Sharpe Capital, Inc.; GZR Company; Security Investment Company of
Kansas City; Herzog, Heine, Geduld; J. Alexander Securities; North American
Institutional Brokers; William V. Frankel & Company. The quotations represent
inter-dealer prices without retail markup, markdown or commission, and may
not necessarily represent actual transactions.

</TABLE>
<TABLE>
<CAPTION>
Quarter Ended High Bid Low Bid
<S> <C> <C>

12/31/97 3.625 2.875
3/31/98 3.50 1.937
6/30/98 4.062 2.187
9/27/98 3.562 1.25
</TABLE>

The Company has never paid any cash dividends nor does it intend, at this
time, to make any cash distributions to its shareholders as dividends in
the near future.

As of September 27, 1998, the number of holders of Company's common stock is 76.
.
Broker-Dealer Sales of Company Securities." The Company has listed its
Common Shares, at least initially, on the OTC Bulletin Board and intends to
seek a listing on NASDAQ Small Cap Market upon meeting the requirements for a
NASDAQ listing, if ever. Upon completion of this offering, the Company will
not meet the requirements for a NASDAQ Small Cap Market listing. As of
February 23, 1998, the requirements for a NASDAQ listing are net tangible
assets of $4,00,000 or market capitalization of $50,000,000 or net income (in
latest fiscal year or 2 of last 3 fiscal years) of $750,000, a public float
of 1,000,000 Common Shares, a market value of the public float of
$55,000,000, a minimum bid price of $4.00 per share, three market makers, 300
round lot shareholders, an operating history of one year or a market
capitalization of $50,000,000 and compliance with corporate governance. The
OTC Bulletin Board has no quantitative written standards and is not connected
with the NASD. Until the Company obtains a listing on the NASDAQ Small Cap
Market, if ever, the Company's securities may be covered by a Rule 15g-9
under the Securities Exchange Act of 1934 that imposes additional sales
practice requirements on broker-dealers who sell such securities to persons
other than established customers and institutional accredited investors

<PAGE>20

(generally institutions with assets in excess of $5,000,000 or individuals
with net worth in excess of $1,000,000 or annual income exceeding $200,000 or
$300,000 jointly with their spouse). For transactions covered by the rule,
the broker-dealer must furnish to all investors in penny stocks, a risk
disclosure document required by Rule 15g-9 of the Securities Exchange Act of
1934, make a special suitability determination of the purchaser and have
received the purchaser's written agreement to the transaction prior to the
sale. In order to approve a person's account for transactions in penny
stock, the broker or dealer must (i) obtain information concerning the
person's financial situation, investment experience and investment
objectives; (ii) reasonably determine, based on the information required by
paragraph (i) that transactions in penny stock are suitable for the person
and that the person has sufficient knowledge and experience in financial
matters that the person reasonably may be expected to be capable of
evaluating the rights of transactions in penny stock; and (iii) deliver to
the person a written statement setting forth the basis on which the broker or
dealer made the determination required by paragraph (ii) in this section,
stating in a highlighted format that it is unlawful for the broker or dealer
to effect a transaction in a designated security subject to the provisions of
paragraph (ii) of this section unless the broker or dealer has received,
prior to the transaction, a written agreement to the transaction from the
person; and stating in a highlighted format immediately preceding the
customer signature line that the broker or dealer is required to provide the
person with the written statement and the person should not sign and return
the written statement to the broker or dealer if it does not accurately
reflect the person's financial situation, investment experience and
investment objectives and obtain from the person a manually signed and dated
copy of the written statement. A penny stock means any equity security
other than a security (i) registered, or approved for registration upon
notice of issuance on a national securities exchange that makes transaction
reports available pursuant to 17 CFR 11Aa3-1 (ii) authorized or approved for
authorization upon notice of issuance, for quotation in the NASDAQ system;
(iii) that has a price of five dollars or more or . . . . (iv) whose issuer
has net tangible assets in excess of $2,000,000 demonstrated by financial
statements dated less than fifteen months previously that the broker or
dealer has reviewed and has a reasonable basis to believe are true and
complete in relation to the date of the transaction with the person.
Consequently, the rule may affect the ability of broker-dealers to sell the
Company's securities and also may affect the ability of purchasers in this
Offering to sell their shares in the secondary market. See "Market for
Registrant's Common Equity and Related Stockholder Matters - Broker-Dealer
Sales of Company's Securities."

- ------------------------------------------------------
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION
- ------------------------------------------------------

Trends and Uncertainties. Demand for the Company's products, franchises and
success of its restaurants will be dependent on, among other things, market
acceptance of the Company's concept, the quality of its food products and
restaurant operations and general economic conditions which are cyclical in
nature. Inasmuch as a major portion of the Company's activities is the
receipt of revenues from the sales of its products, the Company's business
operations may be adversely affected by the Company's competitors and
prolonged recessionary periods.

Capital and Source of Liquidity. The Company requires substantial capital in
order to meet its ongoing corporate obligations and in order to continue and
expand its current and strategic business plans. Initial working capital has
been obtained from the initial sale of the Company's common shares in July
1997 for $.75 per share which raised $156,000, an offering netting
approximately $899,000 for 920,000 shares of common stock at $1.00 per share
pursuant to Regulation D, Rule 504, and additional capital of $775,000 from
the subsequent sale of common stock. The Company also raised a net of
$1,028,810 in August and September 1998 from the sale of Series 1 Secured
Convertible Debentures Due 2001. The Debentures bear interest at 5% per
annum, payable quarterly, and are convertible into common stock at the lesser
of $2.51 or 70% of the average closing bid price for the preceding 5
consecutive trading days.

Additionally, since inception the Company has issued 2,500,000 Series A
Convertible Preferred Shares (for promotional services valued at $50,000),
founders stock of 5,100,000 common shares and 1,526,436 common shares for
various services with an aggregate value of approximately $451,000. The
2,500,000 Series A Preferred Shares were converted into common stock by the
Company in June 1998 in accordance with the preferred stock agreement upon
obtain certain capitalization thresholds.

For the nine months ended September 27, 1998, the Company purchased office
and restaurant equipment totaling $119,337 and received proceeds from
disposal of equipment of $1,200. The Company also invested an additional
$15,000 in a joint venture with Pigs-R-Us and paid expenses of approximately
$28,000 which are to be reimbursed by the joint venture. The Company has also
paid an additional earnest money deposit of $796,000 toward a potential
restaurant chain acquisition and had an increase in other assets of $123,000.
As a result of these activities, the Company used cash for investing
activities of approximately $1,080,000 for the nine months ended September
27, 1998.

<PAGE>21

For the nine months ended September 30, 1997, the Company purchased office
and restaurant equipment of $9,000, paid an earnest money deposit of $50,000
toward the potential business acquisition, and had an increase in other
assets of $53,000. As a result of these activities, the Company used cash for
investing activities of approximately $112,000 for the nine months ended
September 30, 1997.

For the nine months ended September 27, 1998, the Company received proceeds
from short-term borrowings of $37,000 of which $22,000 has been repaid. The
Company also received proceeds of $775,000 from the sale of an additional
428,500 shares of common stock and raised $1,028,810 from the sale of
$1,275,000 of Series 1 Secured Convertible Debentures Due 2001. As a result
of these activities, the Company reported net cash provided by financing
activities of $1,818,810 for the nine months ended September 27, 1998.

For the nine months ended September 30, 1997, the Company received proceeds
from short-term borrowings of $50,000, which was repaid. The Company also
received proceeds from the sale of stock for $117,000 and $500,000 in stock
subscription deposits for shares sold pursuant to Regulation D, Rule 504
which were issued in October 1997. As a result, the Company reported net cash
provided by financing activities of $617,000 for the nine months ended
September 30, 1997.

The Company began selling its sauces through Wal-Mart Supercenters in
December 1997 and through a regional grocery chain in the third quarter of
1998. Capital is needed to finance the production of inventory and
receivables for approximately 30 days of sales.

In March 1998, the Company, through its joint venture partner, Pigs-R-Us,
opened its first restaurant, a Foxworthy's Bar-B-Q. As of September
27, 1998, the Company had contributed $50,000 to the joint venture.
Additionally, the Company has spent considerable funds in continuing to
refine the products, including the gift shop selections, at this unit. A
portion of such costs incurred directly for the benefit of the joint venture
has been billed to the joint venture. All other costs have been expensed or
have been capitalized as development costs. The Company plans to acquire the
remaining interest in the joint venture in the fourth quarter of 1998
pursuant to an agreement with its joint venture partner whereby shares of
common stock will be issued after the completion of an audit. The Company has
agreed to manage the operations until the final audit is complete and the
shares of common stock have been issued.

In March 1998, the Company entered into an agreement to acquire Woody's Bar-
B-Q restaurants, a 33-unit chain based in Jacksonville, Florida. The chain
includes seven company operated and 26 franchised and licensed locations. The
Company expects to pay $2,000,000 in cash plus issuing approximately
$3,400,000 of Convertible Promissory Notes bearing interest at 10% and
maturing in one year, subject to adjustment based upon a closing audit. The
Notes will be convertible into shares of common stock at the lower of $2.93
per share or the average daily closing bid prices for the 30 days prior to
conversion. The Company is attempting to raise the required cash through a
private placement of convertible debentures and other sources. The Company
authorized the issuance of up to $3,000,000 in aggregate principal amount of
Series 1 Secured Convertible Debentures Due 2001. The Debentures bear
interest at 5% per annum, payable quarterly, and are redeemable after two
years at 125% of the principal amount so sold. The Debentures are convertible
at the lower of $2.51 or the average closing bid price of the common stock
for the 5 previous trading days multiplied by 70%. In August and September
1998, the Company sold $1,275,000 of Series 1 Secured Convertible Debentures
Due 2001. No assurance can be made that the financing can be completed or
that the closing will occur.

In February 1998, the Company also entered into an agreement to acquire the
leasehold interest and equipment of an existing barbecue restaurant in
Asheville, North Carolina that is being converted to a Foxworthy's Smokehouse
Grill and will serve as the Company's training and product development center
for this restaurant concept. In addition, the former owners signed a five
year noncompete agreement. The Company acquired these tangible and intangible
assets by issuing $670,000 worth of Company's common stock and expects to
spend approximately an additional $210,000 on the conversion. The unit is
expected to open in the fourth quarter of 1998.

The Company needs to raise approximately $1,200,000 to complete the
acquisition of Woody's. Additionally, the Company needs working capital for
corporate expenditures of approximately $1,000,000 or more over the next 12
months to fund the ongoing development of the Company's business plan. Upon
completion of the Woody's acquisition, the Company will have completed its
capital requirements for its operations development phase. Additional capital
may be required for future restaurant development and/or future acquisitions
that may become available. The Company intends to pursue expansion by
internal growth or acquisition, as capital and business opportunities become
available.

Results of Operations. For the nine months ended September 27, 1998, the
Company had a net loss of $1,597,959. This loss resulted from continued
selling, general and administrative expenses incurred prior to the generation
of significant revenues from restaurant or franchise operations, or from

<PAGE>22

product sales. Net sales for the nine months were primarily from the sale of
food products and merchandise through various distribution networks. No
significant revenues from restaurant or franchise operations have been
produced for the period ended September 27, 1998.

In the nine months ended September 27, 1998, the Company recognized unearned
services received from stock previously issued for $13,500, expenses of
$5,625 for stock options previously granted at a discount, depreciation and
amortization expense of $16,010 and a loss on disposal of equipment of
$1,141. The Company also issued shares of common stock valued at $207,060 for
services provided and expensed. Operationally, the Company had a increase in
accounts receivable of $5,498, a decrease in prepaid expenses and other
assets of $83,567, an increase in inventories in anticipation of opening a
new unit in Asheville, NC of $65,032, and an increase in accounts payable of
$252,345 resulting from ongoing expenses, including continued product and
restaurant design and development and the administrative costs associated
with the assumption of the management of Woody's, without generating
substantial revenues. Accrued expenses decreased by $28,818 primarily from
the payment of salaries accrued in 1997 for the president and two other
officers. As a result, for the nine months ended September 27, 1998, the
Company reported net cash used by operating activities of $1,118,059.

For the nine months ended September 27, 1998, the Company has net sales of
$290,346 and cost of sales of $193,614, reflecting the expected high cost of
sales on product and food sales during the early phases. Selling, general and
administrative expenses of $1,698,217 consisted primarily of compensation and
benefits of $427,674, consulting expenses of $303,132, contract services of
$128,348, insurance of $52,506, marketing of $100,751, professional fees of
$173,612, restaurant development expense of $196,526, and travel and
stockholder relations of $200,235. These expenses continue to be significant
as the Company attempts to attract additional equity and debt financing and
to develop and implement its initial business plan.

For the nine months ended September 30, 1997, the Company had a net loss of
$405,947. This loss occurred during the initial start up period of the
Company. The Company issued shares of common stock valued at $207,190 in
exchange for services. Because of the start up nature during this period, the
Company experienced an increase in prepaid expenses and other assets of
$119,559 primarily related to prepaid insurance and consulting fees. Accounts
payable increased by $5,513 and accrued expenses increased $68,655 for
accrued payroll cost. As a result, for the nine months ended September 30,
1997, the Company reported net cash flow used by operating activities of
$243,898.

For the nine months ended September 30, 1997, the Company generated no
revenues during this initial period of operations. The Company had selling,
general and administrative expenses of $405,796, which consisted of
compensation and benefits of $102,458, consulting expenses of $80,000,
contract services of $117,349, directors' fees of $15,000, and professional
fees of $45,786. The expenses were incurred as the Company hired its initial
personnel, engaged professionals to assist with the development of its
operating concepts and started its search for potential investors.

Plan of Operation. The Company is not delinquent in any of its obligations
even though the Company has generated limited operating revenues. However,
the Company is currently outside of normal vendor terms and continues to
negotiate with vendors while the management continues its efforts to raise
capital. The Company intends to market its products utilizing cash made
available from the private and public sale of its securities. The Company's
management is of the opinion that revenues from the sale of its products, the
revenues from the opening of the Asheville, North Carolina restaurant and the
proceeds of the sales of its securities will be sufficient to pay its
expenses until additional restaurants can be added pursuant to the initial
business plan.

On a long term basis, the Company's liquidity is dependent on continuation
and expansion of operations, revenue generation, additional infusions of
capital and potential debt financing. Company management believes that
additional capital and debt financing in the short term will allow it to
increase its marketing and sales efforts and thereafter result in increased
revenue and greater liquidity in the long term. However, there can be no
assurance that the Company will be able to obtain the needed additional
equity or debt financing in the future.

GENERAL - YEAR 2000 ISSUES. The Company has established a plan to address
Year 2000 issues. This plan encompasses the phases of awareness, assessment,
renovation, validation and implementation. These phases will enable the
Company to identify risks, develop action plans, perform adequate testing and
determine if its processing systems will be Year 2000 ready. Successful
implementation of this plan are expected to mitigate any extraordinary
expenses related to the Year 2000 issue. The Company has a reasonable basis
to preclude that the Year 2000 issue will not materially affect future
financial results, or cause reported financial information not to be
necessarily indicative of future operating results or future financial
conditions. This basis is due to the fact that the Company has or is
installing all new information technology systems, including computer
hardware and software which are Year 2000 compliant. This is the first
generation of equipment and software for the Company since it has just
recently began operations. It also plans that restaurant operations as they
begin will utilize state of the art point of sale equipment.

<PAGE>23

The Company plans to contact all material customers, vendors, suppliers and
non-information technology suppliers regarding their Year 2000 state of
readiness. This process will be conducted over the next six to nine months.
No assurance can be given that the Year 2000 compliance plan will be
completed successfully by the Year 2000. The Company's current contingency
plan is simplistic and involves operating on a manual basis for a short
period of time without interruption of service or quality.

Successful and timely completion of the Year 2000 project is based on
management's best estimates derived from various assumptions of future
events. These events are inherently uncertain, including the progress and
results of vendors, suppliers and customers Year 2000 readiness.

- ----------------------------------------------------------
TERMS OF OFFERING
- ----------------------------------------------------------

Plan of Distribution. The Selling Shareholders may sell the Common Shares
offered hereby in one or more transactions (which may include "block"
transactions in the over-the-counter market, in negotiated transactions or in
a combination of such methods of sales, at fixed prices which may be changed,
at market prices prevailing at the time of sale, at prices related to such
prevailing market prices or at negotiated prices. The Selling Shareholders
may effect such transactions by selling the Shares directly to purchasers, or
may sell to or through agents, dealers or underwriters designated from time
to time, and such agents, dealers or underwriters may receive compensation in
the form of discounts, concessions or commissions from the Selling
Shareholders and/or the purchaser(s) of the Common Shares for whom they my
act as agent or to whom they may sell as principals, or both. The Selling
Shareholders and any agents, dealers or underwriters that act in connection
with the sale of the Common Shares might be deemed to be "underwriters"
within the meaning of Section 2(11) of the Securities Act, and any discount
or commission received by them and any profit on the resale of the Common
Shares as principal might be deemed to be underwriting discounts or
commissions under the Securities Act.

There are not any current or future plans, proposals, arrangements or
understandings by any Selling Shareholders to distribute their registered
shares of Common Stock of the Company to their respective outstanding
shareholders or partners.

There are not any plans, arrangements or understandings by any
Selling Shareholders to sell their registered shares of Common Stock to any
particular individual(s) or to use such registered shares to satisfy
contractual obligations.

The Company will receive no portion of the proceeds from the sale of the
Common Shares by the selling shareholder and will bear all of the costs
relating to the registration of this Offering (other than any fees and
expenses of counsel for the Selling Shareholders). Any commissions,
discounts or other fees payable to a broker, dealer, underwriter, agent or
market maker in connection with the sale of any of the Common Shares will be
borne by the Selling Shareholders.

Offering Procedure. This Offering will terminate on or before
September 30, 1999. In the Company's sole discretion, the offering of
Common Shares may be extended for up to three Thirty day periods, but in
no event later than December 31, 1999.

- --------------------------------------------------------------
DESCRIPTION OF SECURITIES
- --------------------------------------------------------------

Qualification. The following statements constitute brief summaries of the
Company's Certificate of Incorporation and Bylaws, as amended. Such
summaries do not purport to be complete and are qualified in their entirety
by reference to the full text of the Certificate of Incorporation and Bylaws.

The Company's articles of incorporation authorize it to issue up to
100,000,000 Common Shares, $.001 par value per Common Share. The Common
Shares purchased in this Offering will be fully paid and non-assessable. The
Corporation is authorized to issue Two Million Five Hundred Thousand
(2,500,000) Series A Convertible Preferred Shares, par value $.001 per share.

Common Stock. The Company's articles of incorporation authorize it to issue
up to 100,000,000 Common Shares, $.001 par value per Common Share. All
outstanding Common Shares are legally issued, fully paid and non-assessable.

Liquidation Rights. Upon liquidation or dissolution, each outstanding
Common Share will be entitled to share equally in the assets of the Company
legally available for distribution to shareholders after the payment of all
debts and other liabilities.

Dividend Rights. There are no limitations or restrictions upon the
rights of the Board of Directors to declare dividends out of any funds
legally available therefor. The Company has not paid dividends to date and

<PAGE>24

it is not anticipated that any dividends will be paid in the foreseeable
future. The Board of Directors initially may follow a policy of retaining
earnings, if any, to finance the future growth of the Company. Accordingly,
future dividends, if any, will depend upon, among other considerations, the
Company's need for working capital and its financial conditions at the time.

Voting Rights. Holders of Common Shares of the Company are entitled to
cast one vote for each share held at all shareholders meetings for all
purposes.

Other Rights. Common Shares are not redeemable, have no conversion
rights and carry no preemptive or other rights to subscribe to or purchase
additional Common Shares in the event of a subsequent offering.

Preferred Stock. The Corporation is authorized to issue Two Million Five
Hundred Thousand (2,500,000) Series A Convertible Preferred Shares, par value
$.001 per share. The rights, preferences, privileges and restrictions
granted to and imposed on the Common Shares and the Preferred Shares are
identical in all respects, except that the holders of the Preferred Shares
have certain conversion rights and a liquidation preference as set forth
below.

A. Liquidation Preference.
1. In the event of any liquidation, dissolution or winding up of
this corporation, either voluntary or involuntary, the holders of Series A
Preferred Stock shall be entitled to receive, prior and in preference to any
distribution of any of the assets of the Company to the holders of Common
Stock by reason of their ownership thereof, an amount per share equal to the
price for which such share was originally issued, as adjusted for any stock
dividends, combination or splits with respect to such shares. If upon the
occurrence of such event, the assets and funds thus distributed among the
holders of Series A Preferred Shares shall be insufficient to permit the
payment to such holders of the full aforesaid preferential amount, then the

entire assets and funds of this corporation legally available for
distribution shall be distributed ratably among the holders of Series A
Convertible Preferred Shares in proportion to the number of shares of Series
A Convertible Preferred Stock owned by such holder.

2. After payment has been made to the holders of the Series A
Preferred Shares of the full amounts to which they shall be entitled, then
the entire remaining assets and funds of the corporation legally available
for distribution, if any, shall be distributed as follows: Two thirds (2/3)
to the holders of the Common Shares and one third (1/3) to the holders of the
Series A Convertible Preferred Shares.

B. Conversion. The Series A Preferred Shares shall be automatically
convertible upon the effective date (the date on which the amount of
additional capital first equals or exceeds $2,500,000) into the number of
converted shares that shall constitute thirty-three and one third percent of
the outstanding shares of Common Stock on an as-converted basis (that is,
assuming the concurrent conversion into Common Stock of all outstanding
Shares (excluding the Series A Preferred Shares). The Series A Preferred
Shares are convertible into classes or series of stock based on what classes
or series of stock are outstanding at the time of conversion.

Transfer Agent. Florida Atlantic Stock Transfer shall act as the Company's
transfer agent.

- -----------------------------------------------------------
LEGAL MATTERS
- -----------------------------------------------------------
The due issuance of the Common Shares offered hereby will be opined upon for
the Company by J. M. Walker, Attorney-At-Law, in which opinion Counsel will
rely on the validity of the Certificate and Articles of Incorporation issued
by the State of Delaware, as amended and the representations by the
management of the Company that appropriate action under Delaware law has
been taken by the Company.

- --------------------------------------------------------
LEGAL PROCEEDINGS
- --------------------------------------------------------

The Company had retained Harland Adams Spice Company to assist the Company in
the development and distribution of products expected to be developed that
are related to the menu and concept. This relationship has been canceled and
may need to be settled or arbitrated.

The Company has become aware that its use of the term "Backyard" BBQ may be
restricted or terminated due to the potential confusion with other businesses
containing the term "Backyard." The Company does not believe the possibility
of removing "Backyard" from its trademark will materially effect its business
or appeal to customers.

Two former officers of the Company have sued the Company and David and
Theresa Womick, individually, claiming breach of contract of their employment
agreements because of early termination. Each claims damages of $250,000

<PAGE>25

plus attorneys' fees. Additionally, they claim certain interest in the
stock of the Company and desire to limit any sale, pledging or other
conveyance of the Womick's shares of stock. The Company strongly denies
these charges and intends to vigorously contest this lawsuit and does not
expect the outcome to have a material impact on the Company.

The Company is not a party to any other legal proceedings nor is the Company
aware of any other disputes which may result in legal proceedings.

- --------------------------------------------------------
EXPERTS
- --------------------------------------------------------

The audited financial statements included in this Prospectus have been so
included in reliance on the report of Crisp Hughes & Evans, LLP Certified
Public Accountants, on the authority of such firm as experts in auditing and
accounting.

The audited financial statements of Woody's Bar-B-Que included in this
Prospectus have been so included in reliance on the report of Tubbs and
Bartnick, P.A. Certified Public Accountants, on the authority of such firm as
experts in auditing and accounting.

- --------------------------------------------------------
INTERESTS OF NAMED
EXPERTS AND COUNSEL
- --------------------------------------------------------

None of the experts or counsel named in the Prospectus are affiliated with
the Company.

The following financial statements required by Item 310 of Regulation S-B are
furnished below

Independent Auditor's Report
Balance Sheet as of December 31, 1997
Statement of Operations for the Period from Inception to December 31, 1997.
Statement of Cash Flows for the Period from Inception to December 31, 1997.
Statement of Changes in Stockholder's Equity for the Period
From Inception to December 31, 1997.
Notes to Financial Statements

Balance Sheet as of September 27, 1998
Statement of Operations for the Period ended September 27, 1998.
Statement of Cash Flows for the Period ended September 27, 1998.
Notes to Financial Statements

Pro Forma Financial Statements
Pro-forma Balance Sheet as of September 27, 1998
Pro-forma Income Statement for the Nine Months ended September 27, 1998
Pro-forma Income Statement for the year ended December 31, 1997
Notes to Pro Forma Financial Statements

Woody's Financial Statements

Independent Auditor's Report
Consolidated Balance Sheet as of December 28, 1997
Consolidated Statement of Operations for the Year ended December 28, 1997.
Consolidated Statement of Stockholder's Equity for the Year
ended December 28, 1997
Consolidated Statement of Cash Flows for the Year ended December 28, 1997.
Notes to Financial Statements

Condensed Balance Sheet as of September 27, 1998
Condensed Statements of Operations and Accumulated Deficit for the Nine
Months Ended September 27, 1998 and September 30, 1997
Condensed Statements of Cash Flows for the Nine Months Ended September 27,
1998 and September 30, 1997
Notes to Unaudited Condensed Financial Statements

<PAGE>26

Crisp
Hughes
Evans Certified Public Accountants and Consultants
Independent Auditors' Report

Board of Directors
Redneck Foods, Inc.
Asheville. North Carolina

We have audited the balance sheet of Redneck Foods. Inc. (A Development
Stage Company) as of December 31, 1997, and the related statements of
operations changes in stockholders' equity and cash flows for the period
from inception (January 31, l997) through December 31, 1997. These
financial statements are the responsibility of the Company's management.
Our responsibility is to issue an opinion on these financial statements
based on our audit.

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

In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of Redneck
Foods, Inc. (A Development Stage Company) as of December 31. 1997 and
the results of its operations and its cash flows for the period from
inception (January 31, 1997) through December 31. 1997, in conformity
with generally accepted accounting principles.

Crisp Hughes Evans LLP

Asheville. North Carolina
March 24, 1998

<PAGE>27

REDNECK FOODS. INC
(A Development Stage Company)
Balance Sheet
December 31, 1997
<TABLE>
<CAPTION>
Assets
<S> <C>
Current assets:
Cash and cash equivalents $ 397,124
Accounts receivable 98,857
Inventories 1,680
Prepaid expenses 67,122
Total current assets 564,783

Office equipment,
net of accumulated depreciation of $l.004 34,107

Other assets:
Investment in joint venture 35,000
Prepaid expenses and other assets 183,957
Total other assets 218,957
Total assets $ 817,847
Liabilities and Stockholders' Equity

Current liabilities:
Accounts payables $ 149,992
Accrued expenses and other liabilities 72,087
Total Current Liability $ 222,079

Stockholders' equity:

Convertible Preferred stock ($.00l par value,
2,500,000 shares authorized; 2,500,000 outstanding
at December 31, 1997) 2,500
Common stock ($.001 par value, 100,000,000 shares
authorized; 7,592,000 shares issued and outstanding
at December 31.1997) 7,592
Paid-in capital 1,299,768
Deficit accumulated during development stage (655,592)
Unearned services (58,500)
Total stockholders equity 595,768
Total liabilities and stockholders' equity $ 817,847
</TABLE>

See accompanying notes to financial statements.

<PAGE>28

REDNECK FOODS, INC.
(A Development Stage Company)

Statement of Operations
<TABLE>
<CAPTION>
For the Period from Inception (January 31, 1997) through
December 31. 1997
<S> <C>

Net Sales $ 98,857

Cost of goods sold 67,153

Gross profit 31,7O4

Expenses:
General and administrative 692,808

Loss from Operations (661,104)

Other income (expenses:):
Interest income, net 5,512

Loss before income tax benefit (655,592)

Income tax benefit -

Net loss (655,592)
Basic net loss per common share $.12
Weighted average common shares outstanding 5,693,000
</TABLE>
See accompanying notes to financial statements.

<PAGE>29

REDNECK FOOD, INC.
(A Developmental State Company
Statement of Changes in Stockholders' Equity
For the Period from Inception (January 31, 1997 through December 31,
1997
<TABLE>
<CAPTION>
Convertible Preferred Stock
Number of
Shares Amount
<S> <C> <C>
Issuance of convertible preferred $
Stock for services, February 1997
At $.02 per share 2,500,000 2,500

Balance at December 31, 1997 2,500,000 2,500
</TABLE>

<TABLE>
<CAPTION>
Common Stock
Number of Paid-in
Shares Amount Capital
<S> <C> <C> <C>
Issuance of common stock $ l
For services, February
1997 at $.02 per share 5,100,000 5,100 96,900

Issuance of common stock
For services, June 1997
at $.10 per share 1,000,000 1,000 99,000

Issuance of common stock
For services, June 1997
at $.10 per share 416,000 416 41,184

Proceeds from sale of
Common stock, July 1997
At $.75 per share 156,000 156 116,844

Net proceeds from sale of
common stock, October 1997
at $1.00 per share 920,000 920 897,715

Services earned for stock
Options granted at below
Market value -- - 625

Balance at December 31,
1997 7,592,000 7,592 1,229,768
</TABLE>

<TABLE>
<CAPTION>
Deficit
Accumulated
during
Development Unearned
Stage Services Total
<S> <C> <C> <C>

Issuance of convertible $ $ $
Preferred Stock for
services, February 1997
At $.02 per share (50,000)

Issuance of common stock
For services, February
1997 at $.02 per share (102,000)

Issuance of common stock
For services, June 1997
at $.10 per share (100,000)

Issuance of common stock
For services, June 1997
at $.10 per share (41,600)

Proceeds from sale of
Common stock, July 1997
At $.75 per share 117,000

Net proceeds from sale of
common stock, October 1997
at $1.00 per share 898,635

Services earned for stock
Options granted at below
Market value 625

<PAGE>30

Net Loss (655,592) - (655,592)

Amortization of unearned
Services 235,100 235,100

Balance at December 31,
1997 (655,592) (58,500) 595,768

</TABLE>

<PAGE>31

REDNECK FOODS. INC.
(A Development Stage Company)

Statement of Cash Flows

<TABLE>
<CAPTION>
For the Period from Inception (January 31,1997) through December 31, 1997
<S> <C>
Operating activities;
Net loss $ (655,592)
Adjustments to reconcile net loss to net cash
used by operating activities:
Amortization of services received from
stock issuance 235,l00
Expense recognized for stock options granted 625
Depreciation l,004
Changes in operating assets and liabilities:
(Increase) in accounts receivable (98,857)
(Increase) in inventories (1,680)
(Increase) in prepaid expenses (67,122)
(Increase) in other assets (149,957)
Increase in accounts payable 149,992
Increase in accrued expenses and
other liabilities 72,087
Net cash used by operating activities (514,400)

Investing activities:
Purchase of office equipment (35,111)
Investment in joint venture (35,000)
Increase in other assets, escrow deposit (25,000)
Net cash used by investing activities (95,111)

Financing activities:
Proceeds from short-term borrowings 50,000
Repayment of short-term borrowings (50,000)
Prepayment of secondary offering expenses (9,000)
Proceeds from sale of common stock, net 1,015,635
Net cash provided by financing activities 1,006,635
Increase in cash and cash equivalents 397,124
Cash and cash equivalents at inception -
Cash and cash equivalents at end of period $ 397,124
Noncash investing and financing transactions:
Stock issued for services $ 58,500
</TABLE>

See accompanying notes to financial statements.

<PAGE>32

REDNECK FOODS, INC.
(A Development Stage Company)

Notes to Financial Statements
December 31, 1997

1. Organization

Nature of Operations - Redneck Foods. Inc. (the "Company") is a development
stage company that was incorporated on January 31, 1997 in the state of
Delaware. The Company currently intends to acquire and operate barbecue
restaurants to be known as "Foxworthy's Smoke House Grill" or "Foxworthy's
Backyard Bar-B-Q". It plans to initially acquire existing barbecue
restaurants for conversion to one of the two restaurant concepts. The Company
also intends to produce, market, and distribute food products using the
"Foxworthy" name. Operations to date have consisted of the efforts to
negotiate agreements with Jeff Foxworthy and raise the initial capital
necessary to fund sales and marketing efforts, research and development of
food products, inventory and initial start-up expenses. The Company has
elected to end its fiscal year on December 31.

2. Summary of Significant Accounting Policies

The following is a summary of the more significant accounting policies used
in the preparation of the accompanying financial statements.

Basis of Presentation - The accounting principles followed by the Company and
the methods of applying these principles conform with the generally accepted
accounting principles (GAAP) and with general industry practices.

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

Cash and Cash Equivalents - Cash includes cash on hand and deposits at
financial institutions with an initial maturity of three months or less. At
time the Company has cash and cash equivalents which are not covered by
federal deposit insurance. The Company believes it is not exposed to any
significant credit risk on cash and cash equivalents.

Inventories - Inventories are stated at cost determined by the first-in
first-out (FIFO) method.

Office equipment - Office equipment is carried at cost less accumulated
depreciation. Depreciation is provided for financial reporting purposes
principally on the straight-line basis over the estimated useful lives of the
respective assets.

Repairs and maintenance are charged to earnings as incurred. Expenditures
for renewals and betterments are capitalized. The assets and accumulated
depreciation accounts are relieved of the gross amounts with respect to items
replaced, retired or disposed of otherwise. Gains and losses from disposals
are reflected in operations.

Organizational Cost- The organizational cost will be amortized on a straight-
line basis over five years after the first store commences Operations.

Income Taxes - The Company utilizes the liability method of computing income
taxes in accordance with Statement of Financial Accounting Standard No. 109,
"Accounting for Income Taxes" (SFAS 109). Under the liability method,
deferred tax liabilities and assets are established for future 'ax return
effects of temporary differences between the stated value of assets and
liabilities for reporting purposes and their tax basis adjusted for tax rate
changes. The focus is on accruing the appropriate balance sheet deferred tax
amount, with the statement of operations effect being the result of changes
in balance sheet amounts from period to period. Current income tax expense is
provided upon actual tax liability incurred for tax return purposes.

Stock-Based Compensation - Transactions in which goods or services are the
consideration received for the issuance of equity instruments have been
accounted for based on the fair value of the consideration received or the
fair value of the equity instruments issued, whichever is more reliably
measurable. Transactions with employees and non-employee directors have been
accounted for within the scope of APB Opinion 25.

Net loss per Common Share - Basic net loss per common share was computed by
dividing the net loss by the weighted average number of common shares
outstanding during the period in accordance with Statement of Financial
Accounting Standards No. 128. "Earnings Per Share" (SFAS 128). Net loss
available to the common stockholders for the basic loss per share computation
is the net loss report in the statement of operations. The conversion of the
convertible preferred stock and stock equivalents for the stock options would
have no dilutive effect, therefore only the basic net loss per share has been
presented.

<PAGE>33

Impact of New Accounting Pronouncement - During 1997, the Financial
Accounting Standards Board issued Statement of Financial Accounting Standards
No. 130, "Reporting Comprehensive Income" (SFAS 130). SFAS 130 provides
accounting and reporting standards for displaying comprehensive income and
components of comprehensive income n a complete set of financial statements.
SFAS 130 addresses reporting and display only and is effective for fiscal
years beginning after December 15, 1997. The adoption of SEAS 130 is not
expected to have a material impact on the Company's financial statements.

3. Prepaid Expenses
Prepaid expenses consist of the following:

Prepaid insurance $ 17,122
Prepaid consulting 50,000
Total 67,122

Prepaid consulting is cash payments on two consulting agreements for which
services are anticipated to be provided during the next twelve months. The
portion of these prepayments for services which will be fulfilled after that
time have been classified as other assets.

4. Investment in Joint Venture

The Company has entered into a joint venture with Pigs "R" Us, Inc. (A
Florida Corporation) to be called 'Redneck Pigs Joint Venture l". The sole
purpose of the joint venture is create a single barbecue restaurant on
property under lease by Pigs "R" Us. The parties agreed to convert the
venture into a limited liability company as soon as practicable and to
jointly plan, operate and own the pilot restaurant. The Company will
sublicense to the venture certain rights under its license agreement and
contribute capital. The Company has contributed $35,000 to this joint
venture. The Company will own a 10% interest in the venture and therefore
the investment will be accounted for using the cost method. The Company
shall be paid a consulting fee of 3% of gross sales in addition to its
available distributions based on its ownership interest. Certain options and
rights for both parities in the joint venture are established by the
contractual agreement.

5. Other Assets

Included in other assets are prepaid expenses and other assets consist of the
following:
Escrow deposit $ 25,000
Organization cost 3,000
Product/Restaurant design expenses 99,853
Prepaid offering expense 9,000
Prepaid consulting 45,000
Deposits and other prepaid expenses 2,104
Total 183,957

The escrow deposit was made in connection with negotiations with a barbecue
restaurant chain which the Company is currently seeking to acquire.

6. Accrued expenses and other liabilities

Salaries and wages have been accrued for certain executives of the Company
under their employment agreements. These accrued salaries and wages will be
paid upon the acquisition of $2.5 million in initial capital. Currently, the
Company has included in accrued expenses and other liabilities approximately
$59,000 in unpaid salaries and related payroll taxes under these agreements.

7. Income Taxes

The Company plans to file its federal and State income tax returns on a
calendar year basis. No provision for income tax benefit has been provided
for in the accompanying statement of operations because of the Company's
uncertainty regarding the utilization of its operating losses. Accordingly,
a valuation allowance for the deferred tax asset has been recognized at
December 31, 1997.

The difference between actual income tax benefit and the amount computed by
applying the federal statutory income tax rate of 34% to loss before income
tax benefit is reconciled as follows:
Computed income tax benefit $ (223,000)
(Increase) decrease resulting from:
Nondeductible compensation cost recognized for
financial statement purposes 36,000
Valuation allowance for net operating losses 187,000
Actual income tax benefit $ -

At December 31, 1997, deferred tax assets consist primarily of net operating
losses accumulated since inception. The following summarizes the expected
tax consequences of future taxable events due to differences in bases of
assets and liabilities for financial reporting and income tax purposes as of
December 31, 1997.
Gross deferred tax asset $ (187,000)
Less valuation allowance 187,000
Net deferred tax asset $ -

<PAGE>34

At December 31, 1997, the Company has net operating losses of approximately
$545,000 which will expire 2012.

8. Stockholder' Equity

Convertible Preferred Stock - In February 1997, the Company entered into an
agreement which was contractually valued at $50,000 for the use of Jeff
Foxworthy's name and character. The agreement contains a license agreement
as well as a promotional agreement. The license agreement allows the Company
to use his character and name in its marketing efforts. This agreement has a
term of fifty (50) years. The promotional agreement states that Mr.
Foxworthy will provide a certain number of promotional appearance over a five
year period. The entire value of the contract has been assigned to the
promotional agreement and is currently reflected as unearned services in
stockholders equity on the accompanying balance sheet and will be expensed as
promotional services are provided.

In consideration for this agreement, the Company issued 2,500,000 shares of
Class A convertible preferred stock to Mr. Foxworthy. These shares are
convertible into common stock once initial capitalization of $2.5 million is
reached. The conversion ratio is equal to twenty-five percent of the
outstanding shares of common stock on an as converted basis. Upon the
execution of the agreement 1,666,667 shares of the preferred stock were non-
forfeitable by Mr. Foxworthy and the residual 833,333 shares shall become
non-forfeitable ratably over the next five years as the promotional agreement
is satisfied. The convertible preferred stock issued was valued at S.02 per
share.

Common Stock - In February 1997, the Company entered into an agreement to
sell 5,100,000 shares of founders stock to David Womick which was assigned a
value of $.02 per share. In lieu of cash payment and in consideration for
the stock purchased by him from the Company, Mr. Womick agreed to be the
Company's Chief Executive Officer for a period of five years. The employment
services to be rendered have been valued at $102,000 and will be recognized
as compensation in the accompanying statement of operations as earned. Of
the total 5.1 million shares issued, 3.4 million shares are not subject to
forfeiture and the remaining 1.7 million shares subject to forfeiture are
reduced ratably on the first day of each month over a three year period.

In June 1997, the Company entered into two consulting contacts that provided
for the issuance of 1,000,000 shares of common stock in lieu of cash for
consulting services to be rendered. The consulting contracts established a
fair market value conversion rate for the services at $.10 per share. One of
the parties to the consulting contracts subsequently became a director of the
Company. The 200,000 shares issued to this director have been earned and is
restricted common stock pursuant to Rule 144 of the Securities and Exchange
Act of 1933 (the "Act").

In June 1997, the Company also issued restricted stock pursuant to the Act in
consideration for directors fees and services in accordance with various
employment contracts. The aggregate shares issued under these agreements
constituted 416,000 shares of common stock and were valued at $.10 per share
commensurate with the external consulting contracts. Shares issued to
officers have been expensed as services were provided.

In July 1997, the Company sold 156,000 shares of stock to various individuals
for cash at $.75 per share to raise start-up capital. All of the shares of
stock sold have been classified as restricted stock. There was no cost
associated with raising this start-up capital.

The Company has issued in aggregate 772,000 shares of common stock which are
restricted for two years pursuant to Rule 144 of the Act. These restricted
shares allowed the Company to qualify for an exemption from the registration
requirements of the Act and thus file an offering under Rule 504 of
Regulation D as noted below.

In October 1997, the Company completed an offering under Rule 504 of
Regulation D of the Act and sold 920,000 shares of common stock at $1.00 per
share. The costs associated with raising this capital was approximately
$21,000.

9. Stock Options

The Board of Directors has from time to time decided at its discretion to
issue stock options to various individuals who are not employees or non-
employee directors of the Company. As of the balance sheet date, the Company
has granted and outstanding 875,000 options to purchase stock with various
expiration dates ranging from two to ten years. These Options to purchase
stock can be exercised at various prices ranging from $.50 to $1.00 per share
and can be exercise at any time before the expiration date No options to
purchase shares were exercised in 1997. The following table details the
composition of the Options to purchase shares at December 31, 1997.

<PAGE>35

<TABLE>
<CAPTION>
Stock options granted and outstanding Exercise price Date Granted Exp. date
<S> <C> <C> <C>
55,000 shares $1.00 July 1997 July 1999
30,000 shares 1.00 September 1997 September 1999
250,000 shares .85 December 1997 December 2002
540,000 shares .50 July 1997 July 2007
</TABLE>
All of the above options were granted at fair market value except the 250,000
shares which were granted at a 15% discount. The discount is being expensed
over the term of the options.

The Company has not adopted any plans as of December 31, 1997 to grant
options to employees or non-employee directors. In accordance with Statement
of Financial Accounting Standard No. 123 (SFAS 123) "Accounting for Stock-
Based Compensation", the Company has elected to continue to measure employee
compensation cost for the accompanying statement of operations using APB
Opinion No. 25, "Accounting for Stock Issued to Employees". See Note 7 for
discussion of common shares issued to employees and non-employee directors
for services in 1997.

10. Commitments and Contingencies

The Company has entered into employment contracts with certain of its key
employees as well as a license and promotional agreement with Mr. Foxworthy.
These contacts vary in length from three to fifty years in duration.

All contracts with the key employees are considered void if the $2.5 million
of initial capital is not obtained. In the event full initial capital has
not been raised by June 30, 1998, Mr. Foxworthy has the right to withdraw the
use of his name and likeness. Should this event happen, the Company would be
required to discontinue the use of all licensed material. This would require
changing the name of the any restaurants and products. The Company has
limited operating history and the sales of its products and revenues from its
proposed restaurants are currently dependent on the use of the licensed
material.

The Company's operations is also dependent on its ability to raise additional
capital through an anticipated SB-2 registration offering. This additional
capital will be necessary for restaurant acquisitions, marketing and product
development, and general operations.

The Company leases its administrative office facilities under a short-term
operating lease. Rent expense for the period ending December 31, 1997 was
approximately $8,900.

<PAGE>36

REDNECK FOODS, INC.
(A Development Stage Company)
Balance Sheet
(Unaudited)

September 27, 1998
Assets
Current Assets:
Cash $ 18,320
Accounts receivable 132,132
Inventories 66,712
Prepaid expenses 28,555
---------
Total current assets 245,719

Office and restaurant equipment, net of
accumulated depreciation of $8,847 243,260

Other assets:
Investment in joint venture 50,000
Goodwill 500,000
Noncompete agreement, net of
accumulated amortization of $8,167 61,833
Prepaid expenses and other assets 1,303,788
-----------
Total assets $ 2,404,600
===========
Liabilities and Stockholders' Equity

Current liabilities:
Accounts payable $ 402,337
Note payable 15,000
Accrued expenses 43,269
----------
Total current liabilities 460,606
----------
Convertible debentures 1,275,000

Commitments and contingencies

Stockholders' equity:
Convertible Preferred stock ($.001 par value,
2,500,000 shares authorized, none outstanding) -
Common stock ($.001 par value, 100,000,000
shares authorized; 11,258,991 shares issued
and outstanding) 11,259
Paid-in capital 2,956,286
Deficit accumulated during
development stage (2,253,551)
Unearned services (45,000)
----------
Total stockholders' equity 668,994
----------
Total liabilities and stockholders' equity $ 2,404,600
==========

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

<PAGE>37

REDNECK FOODS, INC. AND SUBSIDIARY
(A Development Stage Company)
Statements of Operations
(Unaudited)
<TABLE>
<CAPTION>
For Nine Months Ended For Three Months Ended
Sept. 27, 1998 Sept. 30, 1997 Sept. 27, 1998 Sept. 30, 1997
<S> <C> <C> <C> <C>
Net sales $ 290,346 $ - $ 178,717 $ -

Cost of sales
Interest earning deposits 193,614 - 118,701 -
-------- ----- -------- --------
Gross profit 96,732 - 60,016 -

Selling, general and
administrative expenses 1,698,217 405,796 612,304 157,723
--------- ------- ------- -------
Operating loss (1,601,485) (405,796) (552,288) (157,723)

Other income (expenses):
Interest income 2,371 203 127 203
Royalty income 10,756 - 5,010 -
Interest expense (8,460) (354) (8,460) (354)
Loss on equipment
disposal (1,141) - - -
--------- ------- ------- -------
Other income (expenses), net 3,526 (151) (3,323) (151)

Loss before income tax benefit (1,597,959) (405,947) (555,611) (157,874)

Income tax benefit - - - -
----------- --------- --------- ---------
Net loss $(1,597,959) $(405,947) $(555,611) $(157,874)
=========== ========= ========= =========

Basic and diluted loss per share $(.18) $ (.07) $ (.05) $ (.02)

Weighted average shares 9,063,701 5,712,176 11,257,127 6,670,304
</TABLE>

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

<PAGE>38

REDNECK FOODS, INC. AND SUBSIDIARY
(A Development Stage Company)
Statements of Cash Flows
(Unaudited)

<TABLE>
<CAPTION>
Nine Months Ended
September 27, 1998 September 30, 1997
<S> <C> <C>
Operating activities:
Net loss $ (1,597,959) (405,947)

Adjustments to reconcile net loss to net cash
used by operating activities:
Recognition of unearned services 13,500 -
Expense recognized for stock options granted 5,625 -
Depreciation and amortization 16,010 250
Loss on disposal of equipment 1,141 -
Common stock issued in exchange for services 207,060 207,190
Changes in operating assets and liabilities:
Increase in accounts receivable (5,498) -
Decrease (increase) in prepaid expenses and other assets 83,567 (119,559)
Increase in inventories (65,032) -
Increase (decrease) in accounts payable 252,345 5,513
Increase (decrease ) in accrued expenses (28,818) 68,655
--------- -------
Net cash used by operating activities (1,118,059) (243,898)
--------- -------
Investing activities:
Proceeds from disposal of equipment 1,200 -
Purchase of office and restaurant equipment (119,337) (9,360)
Investment in joint venture (15,000) -
Advances to joint venture (27,777) -
Earnest money deposits for business acquisition (795,930) (50,000)
Increase in other assets (122,711) (52,419)
--------- -------
Net cash used by investing activities (1,079,555) (111,779)
--------- -------
Financing activities:
Net proceeds from sale of common stock 775,000 117,000
Proceeds from stock subscription deposits - 500,000
Proceeds from convertible debentures 1,028,810 -
Proceeds from short-term borrowings 37,000 50,000
Repayment of short-term borrowings (22,000) (50,000)
--------- -------
Net cash provided by financing activities 1,818,810 617,000

Increase (decrease) in cash and cash equivalents (378,804) 261,323

Cash and cash equivalents at beginning of period 397,124 -
--------- -------

Cash and cash equivalents at end of period $ 18,320 $ 261,323
========= ========

Noncash Investing and financing activities:

Preferred stock converted to common stock 2,500 -
Common stock issued for equipment,
goodwill and noncompete agreement $ 670,000 $ -
</TABLE>

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

<PAGE>39

REDNECK FOODS, INC.
(A Development Stage Company)
Notes to Unaudited Interim Financial Statements

September 27, 1998 and September 30,1997

1. Organization

Nature of Operations - Redneck Foods, Inc. (the "Company") is a development
stage company that was organized in January 1997 in the state of
Delaware. It intends to acquire and operate barbecue restaurants to be
known as "Foxworthy's Smoke House Grill" or "Foxworthy's Backyard Bar-B-
Q". The Company intends to initially acquire existing barbecue
restaurants for conversion to one of the two restaurant concepts. The
Company also intends to produce, market, and distribute food products
using the "Foxworthy" name.

2. Basis of Presentation

The accompanying unaudited financial statements were prepared in accordance
with instructions for Form 10-QSB and, therefore, do not include all
disclosures necessary for a complete presentation of the balance sheet,
statements of operations, and statements of cash flows in conformity with
generally accepted accounting principles. However, all adjustments which
are, in the opinion of management, necessary for the fair presentation of
the interim financial statements have been included. All such adjustments
are of a normal recurring nature. The statements of operations for the
interim periods are not necessarily indicative of the results which may be
expected for the entire year.

In the third quarter of 1998, the Company changed to a fiscal calendar based
on a 52-53 week year with the fiscal year ending on the Sunday closest to
December 31 of each year. Management does not believe this effects the
comparability of the financial statements.

It is suggested that these unaudited financial statements be read in
conjunction with the audited financial statements and notes thereto for the
Company for the year ended December 31, 1997.

3. Income Taxes

The Company files its federal and State income tax returns on a calendar year
basis. No provision for income tax benefit has been provided for in the
accompanying interim unaudited statements of operations because of the
Company's uncertainty regarding the utilization of its operating losses.
Accordingly, a valuation allowance for the deferred tax asset has been
recognized at September 27, 1998.

4. Joint Venture

In March 1998 the Company has entered into a joint venture agreement to own
and operate the first barbecue restaurant under the "Foxworthy's
Backyard Bar-B-Q" concept. The Company contributed $50,000 to the joint
venture through September 27, 1998 for its 10% interest and has not yet
begun receiving any significant royalty income from the joint venture.
The Company plans to acquire the remaining interest in the joint venture
in the fourth quarter of 1998 pursuant to an agreement with its joint
venture partner whereby common shares will be issued after the
completion of an audit. The Company has agreed to manage the operations
until the final audit is complete and the shares of common stock have
been issued.

5 Prepaid Expenses and Other Assets

Prepaid expenses and other assets consist of following at September 27,
1998:

Deposits $ 13,034
Real estate deposit 42,352
Restaurant design and
architectural fees 131,282
Debt issuance cost 246,190
Earnest money deposit for
business acquisition 870,930
-----------
$1,303,788

On September 11, 1998, the Company obtained an extension relating to its
ongoing negotiations to acquire all of the stock of Woody's Bar-B-Q Holdings,
Inc.("Woody's"), a 33 unit chain of barbecue restaurants based in
Jacksonville, Florida. To obtain this extension, the Company agreed to
release to the selling shareholders of Woody's $870,930, representing the
net funds held in escrow at that time. The parties have verbally extended
the agreement until December 31, 1998 to give the Company additional
time to raise the necessary funding. The parties have also verbally agreed
to have the Company manage the business of Woody's under certain prudent
industry practices guidelines. A formal written agreement to document this
is being finalized.

<PAGE>40

6. Secured Convertible Debentures

In order to fund the cash portion of the proposed acquisition of Woody's, the
Company authorized the issuance of up to $3 million in aggregate principal
amount of Series 1 Secured Convertible Debentures due 2001 (the
"Debentures"). The Debentures bear interest at 5% per annum, payable
quarterly, and are redeemable after 2 years at 125% of the principal amount
sold. The Debentures are convertible, subject to certain adjustments, at
the lower of (1) $2.51 per share or (2) 70% of the average of the closing
bid price of the stock for the previous five (5) trading days. As of
September 27, 1998, $1,275,000 in Debentures have been sold.

7. Stockholders' Equity
In June 1998, the 2,500,000 shares of convertible preferred stock were
converted into 2,904,722 shares of common stock in accordance with the
preferred stock agreement.

During the nine months ending September 27, 1998, the Company also issued
223,333 shares of common stock under an asset purchase agreement with an
fair market value of $670,000 to the owners of a barbecue restaurant in
Asheville, North Carolina. The stock issued was in consideration for a five
year noncompete agreement valued at $70,000, goodwill valued at $500,000 and
various restaurant equipment valued at $100,000. The Company anticipates
completing the acquisition of the land, building and improvements sometime
in the fourth quarter of 1998. As of September 27, 1998, the Company had
deposited with the sellers $42,352 toward the purchase price of the real
property. This deposit is presented in other assets on the accompanying
balance sheet.

During the nine months ending September 27, 1998, the Company sold 428,500
additional shares of common stock for net proceeds of $775,000 and issued
110,436 shares in exchange for services which have been expensed at the fair
market value of the shares on the date of issuance.

8. New Accounting Pronouncement

In April 1998, the American Institute of Certified Public Accountants issued
Statement of Position ("SOP") 98-5, "Reporting on the Cost of Start-up
Activities". This SOP requires that the cost of start-up activities, or one-
time activities that relate to the opening of a new facility and
organizational cost be expensed as incurred instead of being capitalized.
This SOP must be implemented by no later than the first quarter of 1999 at
which time the write-off of any unamortized pre-opening costs or
organization cost will be reported as a cumulative effect of a change in
accounting principle in the statement of operations.

9. Commitments and Contingencies

The agreement with Mr. Foxworthy provided that if the Company had not raised
$2.5 million of initial capital by June 30, 1998, Mr. Foxworthy had the
right to withdraw the use of his name and likeness. As of June 7, 1998, the
initial capital had been raised and, accordingly, this contingency was
removed.

<PAGE>41

REDNECK FOODS, INC.
(A DEVELOPMENT STAGE COMPANY)
PRO FORMA FINANCIAL STATEMENTS

SUMMARY

The accompanying unaudited pro forma financial statements give effect to the
acquisition by Redneck Foods, Inc. of Woody's Bar-B-Q Holdings, Inc. on
September 11, 1998 using the purchase method of accounting.

The statements presented include the pro forma balance sheet as of September
27, 1998 and the pro forma income statements for the nine months ended
September 27, 1998 and the year ended December 31, 1997. The pro forma
financial statements were derived from the unaudited interim financial
statements for Redneck Foods, Inc. and Woody's Bar-B-Q Holdings, Inc. as of
September 27, 1998 and for the nine months then ended and the audited
financial statements for Redneck Foods, Inc. as of December 31, 1997 and
Woody's Bar-B-Q Holdings, Inc. as of December 28, 1997 and the years then
ended.

The results of operations are not necessarily indicative of those which have
been attained had the transaction occurred at the beginning of the periods
presented. The pro forma financial statements should be read in conjunction
with the financial statements of Woody's Bar-B-Q Holdings, Inc. included
elsewhere in this filing and the financial statements of Redneck Foods, Inc.
included in their periodic filings with the Securities and Exchange
Commission.

<PAGE>42

REDNECK FOODS, INC.
(A DEVELOPMENT STAGE COMPANY)
PRO-FORMA BALANCE SHEET
AS OF SEPTEMBER 27, 1998
(UNAUDITED)

<TABLE>
<CAPTION>
Woody's
Redneck Bar-B-Q
Foods, Inc. Holdings, Inc. Adjustments Pro-forma
ASSETS ----------- -------------- ----------- ---------
<S> <C> <C> <C> <C>
CURRENT ASSETS
Cash $ 18,320 $ - $ - $ 18,320
Accounts receivable 132,132 153,472 - 285,604
Other receivables - 12,644 - 12,644
Inventory 66,712 30,354 - 97,066
Prepaid expenses 28,555 5,978 - 34,533
----------- ----------- ---------- --------
Total curent assets 245,719 202,448 - 448,167

PROPERTY AND EQUIPMENT - NET 243,260 593,829 - 837,089

OTHER ASSETS
Deferred loan costs 246,190 12,312 - 258,502
Deposits and investments 920,000 - (3) (870,000) 50,000
Goodwill 500,000 - (1) 4,530,000 6,477,990
(3) 870,000
(5) 577,990
Due from related parties - 117,469 - 117,469
Other asets 249,431 11,889 - 261,320
----------- ---------- --------- ---------

TOTAL ASSETS $ 2,404,600 $ 937,947 $5,107,990 $8,450,537
=========== ========== ========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
Current portion of long-term debt $ - $ 63,163 $ - $ 63,163
Notes payable 15,000 - - 15,000
Bank overdraft - 99,405 - 99,405
Advertising trust fund - 53,482 - 53,482
Accounts payable and accrued expenses 445,606 686,984 - 1,132,590
----------- --------- ---------- ----------
Total current liabilities 460,606 903,034 - 1,363,640
----------- --------- ---------- ----------

LONG-TERM DEBT 1,275,000 612,903 (1) 4,530,000 6,417,903
----------- --------- ---------- ----------

STOCKHOLDERS' EQUITY (DEFICIT)
Preferred Stock - - - -
Common Stock 11,259 100 (5) (100) 11,259
Additional paid in capital 2,956,286 34,492 (5) (34,492) 2,956,286
Accumulated deficit (2,253,551) (612,582)(5) 612,582 (2,253,551)
Unearned services (45,000) - - (45,000)
----------- -------- --------- ---------
Total stockholders' equity (deficit) 668,994 (577,990) 577,990 668,994
----------- -------- --------- ---------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 2,404,600 $ 937,947 $5,107,990 $8,450,537
=========== ========= ========== =========

Read the accompanying notes to the pro-forma financial statements.
</TABLE>

<PAGE>43

REDNECK FOODS, INC.
(A DEVELOPMENT STAGE COMPANY)
PRO-FORMA INCOME STATEMENT
FOR THE NINE MONTHS ENDED SEPTEMBER 27, 1998
(UNAUDITED)
<TABLE>
<CAPTION>
Woody's
Redneck Bar-B-Q
Foods, Inc. Holdings, Inc. Adjustments Proforma
------------ -------------- ----------- ----------
<S> <C> <C> <C> <C>
REVENUE $ 290,346 $4,274,035 $ - $ 4,564,381
---------- ---------- --------- -----------

OPERATING COSTS AND EXPENSES
Food and beverage - 1,413,173 - 1,413,173
Occupancy and other operating expenses 193,614 1,296,668 - 1,490,282
Selling, general and administrative 1,690,374 1,357,187 - 3,047,561
Depreciation and amortization 7,843 60,877 (4) 224,175 292,895
--------- --------- --------- ----------
Total operating expenses 1,891,831 4,127,905 224,175 6,243,911
--------- --------- --------- ----------

INCOME (LOSS) FROM OPERATIONS (1,601,485) 146,130 (224,175) (1,679,530)

Other income (expense)
Interest expense (8,460) (45,085)(2) (330,000) (383,545)
Other income 11,986 4,271 - 16,257
--------- --------- -------- ---------

NET INCOME (LOSS) $(1,597,959) $ 105,316 $(554,175) $(2,046,818)
=========== ========= ======== =========

Basic (loss) per share $ (0.18) $ 10.53 $ (0.23)
=========== ========= =========
Weighted average shares outstanding 9,063,701 10,000 9,063,701
=========== ========= =========
</TABLE>
Read the accompanying notes to the pro-forma financial statements

<PAGE>44

REDNECK FOODS, INC.
(A DEVELOPMENT STAGE COMPANY)
PRO-FORMA INCOME STATEMENT
FOR THE YEAR ENDED DECEMBER, 1997
(UNAUDITED)
<TABLE>
<CAPTION>
Woody's
Redneck Bar-B-Q
Foods, Inc. Holdings, Inc. Adjustments Proforma
------------ -------------- ----------- ----------
<S> <C> <C> <C> <C>
REVENUE $ 98,857 $5,791,008 $ - $ 5,889,865
---------- ---------- --------- -----------

OPERATING COSTS AND EXPENSES
Food and beverage - 2,021,086 - 2,021,086
Occupancy and other operating expenses 67,153 2,736,376 - 2,803,529
Selling, general and administrative 691,804 1,094,627 - 1,786,431
Depreciation and amortization 1,004 104,947 (4) 298,900 404,851
--------- --------- --------- ----------
Total operating expenses 759,961 5,957,036 298,900 7,015,897
--------- --------- --------- ----------

INCOME (LOSS) FROM OPERATIONS (661,104) (166,028) (298,900) (1,126,032)

Other income (expense)
Interest expense - (55,338) (2) (440,000) (495,338)
Other income 5,512 21,933 - 27,445
--------- --------- -------- ---------

NET INCOME (LOSS) $ (655,592) $(199,433) $(738,900) $(1,593,925)
=========== ========= ======== =========

Basic (loss) per share $ (0.12) $ (19.94) $ (0.28)
=========== ========= =========
Weighted average shares outstanding 5,693,000 10,000 5,693,000
=========== ========= =========
</TABLE>
Read the accompanying notes to the pro-forma financial statements

<PAGE>45

REDNECK FOODS, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO UNAUDITED PRO FORMA FINANCIAL STATEMENTS

The accompanying pro forma financial statements give effect to the
acquisition by Redneck Foods, Inc. ("Redneck") of Woody's Bar-B-Q Holdings,
Inc. ("Woody's") on September 11, 1998. The purchase price to be paid by
Redneck (subject to certain adjustments based upon a closing balance sheet
audit) consists of $2 million in cash and $3.4 million of convertible
promissory notes bearing interest at 10% and due in one year. The notes are
convertible into common stock of Redneck at the lower of $2.93 per share or
the average daily bid price for the thirty days prior to conversion.
Additionally, Redneck will issue to the sellers warrants to purchase 500,000
shares of its common stock at the lower of $1.71 per share or the conversion
price identified above.

Pro forma basic earnings per share is computed using the weighted average
number of common shares of Redneck outstanding for the periods presented.

<PAGE>46

REDNECK FOODS, INC.
(A DEVELOPMENT STAGE COMPANY)
EXPLANATION OF ADJUSTMENTS
PRO FORMA FINANCIAL STATEMENTS
(UNAUDITED)

1. To record the anticipated issuance of $4.53 million of new debt (see Note
2) and the goodwill related to the acquisition.

2. To adjust for anticipated effects which the additional debt required to
complete the acquisition would have on the results of operations for the year
ended December 31, 1997 and the nine months ended September 27, 1998 assuming
that the debt was issued at the beginning of the period presented.

The debt issued or to be issued is as follows:

Anticipated debt to be issued to the Woody's shareholders,
with interest at 10% per annum $3,400,000
Anticipated additional convertible debentures to be issued
to complete the $2 million payment to the Woody's
shareholders, with interest at 5% per annum 1,130,000
Convertible debentures issued to date,
with interest at 5% per annum 870,000
----------
$5,400,000

3. To reclassify the $870,000 cash deposit related to the acquisition to
goodwill.

4. To adjust for anticipated amortization of goodwill of $5,977,990 related
to the transaction assuming a 20 year amortization period.

5. To reclassify Woody's stockholders' deficit to goodwill

<PAGE>47

INDEPENDENT AUDITOR'S REPORT

To the Board of Directors and Shareholders:
Woody's Bar-B-Q Holdings, Inc. and Subsidiaries

We have audited the consolidated balance sheet of Woody's Bar-B-Q Holdings,
Inc. and Subsidiaries as of December 28, 1997 and the related consolidated
statements of operations, stockholders' equity and cash flows for the year
then ended. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audit.

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

In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of Woody's
Bar-B-Q Holdings, Inc. and Subsidiaries as of December 28, 1997, and the
results of its operations and its cash flows for the year then ended, in
conformity with generally accepted accounting principles.

TUBBS & BARTNICK, P.A.
Certified Public Accountants

Boca Raton, Florida
October 26, 1998

<PAGE>48

WOODY'S BAR-B-Q HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
AS OF DECEMBER 28, 1997

ASSETS
<S> <C>

CURRENT ASSETS:

Cash $ 33,364
Accounts receivable - less allowance
for doubtful accounts of $44,743 97,031
Other receivables 5,203
Inventories 30,961
Prepaid expenses 21,643
---------
Total Current Assets 188,202

PROPERTY AND EQUIPMENT - NET 595,356

OTHER ASSETS:
Deferred loan costs 12,290
Due from related parties 169,411
Other assets 7,247
---------
TOTAL ASSETS $ 972,506
==========

LIABILITIES AND STOCKHOLDERS' EQUITY <DEFICIT>

CURRENT LIABILITIES:

Current portion of long-term debt $ 129,050
Due to related parties 69,269
Advertising trust fund 24,260
Accounts payable and accrued expenses 806,844
---------
Total Current Liabilities 1,029,423
---------
LONG-TERM DEBT 626,389
---------

STOCKHOLDERS' EQUITY <Deficit>:
Common stock, Class A, $.01 par value,
50,000 shares authorized, 10,000 shares
issued and outstanding 100
Common stock, Class B, non-voting,
$.01 par value, 50,000 shares authorized,
none issued or outstanding -
Additional paid in capital 34,492
Accumulated deficit (717,898)
---------
Total Stockholders' Equity<Deficit> (683,306)
---------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 972,506
=========

Read the accompanying notes to the financial statements

<PAGE>49

WOODY'S BAR-B-Q HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 28, 1997

REVENUE

Sales by Company operated restaurants $ 5,109,479
Franchise revenue 681,529
-----------
Total Revenue 5,791,008
-----------

OPERATING COSTS AND EXPENSES:

Food and beverage 2,021,086
Occupancy and other operating expenses 2,736,376
Selling general and administrative expenses 1,094,627
Depreciation and amortization 104,947
-----------
Total Operating Expenses 5,957,036
-----------

<LOSS> FROM OPERATIONS (166,028)
-----------

OTHER INCOME (EXPENSE):
Interest expense (55,338)
Other income 21,933
-----------

Total Other (Expense) - Net (33,405)
-----------
NET <LOSS> $ (199,433)
===========

Read the accompanying notes to the financial statements

<PAGE>50

WOODY'S BAR-B-Q HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
FOR THE YEAR ENDED DECEMBER 28, 1997

</TABLE>
<TABLE>
<CAPTION>
Common Stock
------------------ Paid in Accumulated
Shares Amount Capital Deficit
------ ------ ------- -----------
<S> <C> <C> <C> <C>
BALANCE DECEMBER 31, 1996 10,000 $100 $ 34,492 $ (518,465)

NET LOSS FOR THE YEAR (199,433)
------ ------ -------- ----------

BALANCE DECEMBER 28, 1997 10,000 $100 $ 34,492 $ (717,898)
====== ====== ======== ==========

</TABLE>

Read the accompanying notes to the financial statements

<PAGE>51

WOODY'S BAR-B-Q HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED DECEMBER 28, 1997

CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss) $ (199,433)
Adjustments to reconcile net (loss)
to net cash (used in)
operating activities:
Depreciation and amortization 104,947
Changes in assets and liabilities:
(Increase) decrease in:
Accounts receivable 20,153
Inventory 16,938
Prepaid expenses 727
Other assets 40,089
Increase (decrease) in:
Accounts payable and accrued expenses (40,021)
---------
Net Cash Used In Operating Activities (56,600)
---------

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment (83,021)
---------
Net Cash (Used In) Investing Activities (83,021)
---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Gross proceeds from long-term debt 218,364
Capitalized loan acquisition costs (12,290)
Principal payments on long-term debt (76,303)
Increase in amounts due to related parties 43,214
---------
Net Cash Provided by Financing Activities 172,985
---------

NET INCREASE IN CASH 33,364

CASH BEGINNING OF YEAR -
---------

CASH - END OF YEAR $ 33,364
=========

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:

Cash paid for:
Interest $ 53,454
Income taxes $ -

Read the accompanying notes to the financial statement

<PAGE>52

WOODY'S BAR-B-Q HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
AS OF DECEMBER 28, 1997

Note 1 - Accounting policies

A. Organization

Woody's Bar-B-Q Holdings, Inc. is in the business of owning, operating and
franchising restaurants specializing in barbecue foods. The restaurants also
provide catering services. In addition, the Company sells franchises of its
barbecue restaurants. The Company's seven owned and operated restaurants are
located in Jacksonville, Florida.

The Company's accounting records are maintained on a 52 - 53 week year which
ends on the Sunday closest to December 31. The Company has chosen December
31 as its year end for income tax purposes.

B. Consolidation policy

The accompanying consolidated financial statements include the accounts of
the Company and its wholly owned subsidiaries which include the following:

Woody's Bar-B-Q, Inc.
Woody's Bar-B-Q Franchise Sales Company, Inc.
Woody's Bar-B-Q I, Inc.
Woody's Bar-B-Q II, Inc.
Woody's Bar-B-Q IV, Inc.
Woody's Bar-B-Q VI, Inc.
Woody's Bar-B-Q IX, Inc.
Woody's Bar-B-Q X, Inc.
Woody's Bar-B-Q XI, Inc.

Intercompany transactions and balances have been eliminated in consolidation.

C. Inventory

Inventory is stated at the lower of cost or market on a first in - first out
basis and consists of food, beverages, paper supplies and janitorial
supplies.

D. Property and equipment

Property and equipment are stated at cost, less accumulated depreciation.
Depreciation is calculated using the straight line method over the expected
useful lives of the assets as follows:

Buildings 40 years
Furniture and fixtures 10 years
Equipment 5 to 10 years
Leasehold improvements Lesser of the useful life
of the asset or lease term
including renewal options

E. Cash and cash equivalents

For purposes of the statement of cash flows, the Company considers all highly
liquid debt instruments purchased with a maturity of 3 months or less to be
cash equivalents.

F. Revenue recognition for franchised operations

When an individual franchise is sold the Company agrees to provide certain
services to the franchisee. Generally, these services include general
assistance and guidance in the operation of the restaurant, maintaining
product specifications and menu development, developing and implementing
marketing strategies, and developing purchasing arrangements to utilize the
buying power of the combined system.

Franchise revenue consists of an initial franchise fee for establishing the
franchise agreement and certain services leading to the opening of the
restaurant as well as continuing royalty fees for services performed once the
restaurant is operating. The initial franchise fee is recognized as revenue
when all material services and conditions related to the franchise sale have
been substantially performed by the Company. Continuing royalty fees are
recognized as revenue as they are earned and become receivable from the
franchisee.

At December 28, 1997 there were twenty-four stores operating in the franchise
system.

Franchise revenue consists of the following:

Franchise sales $ 107,500
Royalty fees 527,721
Other 46,308
---------
$ 681,529
=========

<PAGE>53

WOODY'S BAR-B-Q HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
AS OF DECEMBER 28, 1997

G. Use of Estimates

The preparation of the Company's financial statements requires management to
make estimates and assumptions that affect the amounts reported in the
financial statements and accompanying notes. Actual results could differ from
these estimates.

H. Advertising costs

Advertising costs are charged to operations when incurred. Advertising costs
charged to operations were $132,059 in 1997.

I. Fair value of financial instruments

Fair value estimates discussed herein are based upon certain market
assumptions and pertinent information available to management as of December
28, 1997. The respective carrying value of certain on-balance-sheet financial
instruments approximated their fair values. These financial instruments
include cash, trade receivables, accounts payable and accrued expenses. Fair
values were assumed to approximate carrying values for these financial
instruments because they are short term in nature and their carrying amounts
approximate fair values or they are receivable or payable on demand. The fair
value of the Company's long-term debt is estimated based upon the quoted
market prices for the same or similar issues or on the current rates offered
to the Company for debt of the same remaining maturities.

J. Deferred loan costs

Deferred loan costs consist of costs incurred in securing the note payable in
the amount of $451,992 described in Note 3. These costs will be amortized
over the term of the note through October, 2000.

K. Recent pronouncement

In June, 1997, the Financial Accounting Standards Board issued Statement of
Financial Standards No. 130, "Reporting Comprehensive Income," (FAS 130). FAS
130 establishes standards for reporting and displaying comprehensive income,
its components and accumulated balances. FAS 130 is effective for periods
beginning after December 15, 1997. The Company does not anticipate that FAS
130 will have a material impact on its future financial statements and
disclosures.

Note 2 - Property and Equipment

Property and Equipment consist of the following at December 28, 1997:

Furniture and fixtures $ 21,996
Equipment 627,287
Leasehold improvements 373,252
Land and building 384,640
---------
1,407,175
Less: accumulated depreciation 811,819
---------
$ 595,356
=========
Depreciation expense was $98,097 in 1997.

Note 3 - Long-term debt

Long-term debt consists of the following at December 28, 1997:

Note payable bank - due in monthly installments of $4,770
including interest at 9.5%, through October, 2000 at which
time the balance is due on demand (secured by land and building
and guaranteed by the majority shareholders) $ 451,992

Note payable bank - due in monthly installments of $2,594
including interest at 10%, through July, 2006 (secured
by land and building) 196,470

Note payable due in monthly installments of $700 including
interest at 8%, through February, 2000 16,467

Note payable with interest at 8% due on demand 40,636

Note payable with interest at 8% due on demand 49,874
----------
Total 755,439
Less current portion 129,050
----------
TOTAL LONG-TERM DEBT - LESS CURRENT PORTION $ 626,389
==========

<PAGE>54

WOODY'S BAR-B-Q HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
AS OF DECEMBER 28, 1997

Maturity of long-term debt is as follows:

1998: $129,050
1999: 41,120
2000: 440,788
2001: 20,282
2002: 21,986
Thereafter: 102,213
--------
$755,439
========

Note 4 - Related Party Transactions

Due from related parties: At December 28, 1997 the Company's majority
shareholders were indebted to the Company in the amount of $169,411 for
advances and other obligations paid on their behalf. There are no stated
terms for repayment.

Due to related parties: The Company leases two restaurant buildings from its
majority shareholders (see Note 5). At December 28, 1997 the Company had
unpaid rent due to these shareholders aggregating $69,269.

Note 5 - Commitments and contingencies

Operating Leases

The Company leases its restaurant locations pursuant to several leases. The
leases provide for various escalations based on cost of living, real estate
taxes, and other provisions and have various renewal options. In addition,
the Company leases certain equipment pursuant to leases classified as
operating leases. Total monthly lease payments aggregate approximately
$41,000.

Two of the restaurant facilities are leased from the majority shareholders of
the Company at a monthly rental aggregating approximately $8,400, which
approximates fair market value. Rent paid or accrued pursuant to these leases
aggregated $96,505 in 1997.

Total rent expense (including rent paid to the shareholder) was $392,406 in
1997.

Future minimum rentals for leases with remaining terms in excess of one year
are as follows:

1998: $491,232
1999: $456,128
2000: $350,287
2001: $184,535
2002: $143,760
Thereafter: $224,698

Concentrations

The Company utilizes a single source (Sysco Food Services) for the majority
of its food purchases. During 1997 purchases aggregating approximately
$1,500,000 were made from this source. The Company believes that the loss of
this source would not materially impact its operations as there are a number
of alternate suppliers which could meet the Company's needs.

Note 6 - Income taxes

The Company accounts for income taxes under Statement of Financial Accounting
Standards No. 109 (FAS 109), "Accounting for Income Taxes", which requires
use of the liability method. FAS 109 provides that deferred tax assets and
liabilities are recorded based on the differences between the tax bases of
assets and liabilities and their carrying amounts for financial reporting
purposes, referred to as temporary differences. Deferred tax assets and
liabilities at the end of each period are determined using the currently
enacted tax rates applied to taxable income in the periods in which the
deferred tax assets and liabilities are expected to be settled or realized.

The Company has net operating loss carry forwards aggregating approximately
$706,000 which expire as follows:

Year Ending
December 31, Amount
2007 $ 18,000
2008 $180,000
2009 $ 98,000
2010 $168,000
2011 $ 42,000
2012 $200,000

<PAGE>55

WOODY'S BAR-B-Q HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
AS OF DECEMBER 28, 1997

The Company's deferred tax asset of approximately $275,000 is fully offset by
a valuation allowance at December 28, 1997. The Company has recorded a
valuation allowance to state its deferred tax assets at estimated net
realizable value due to the uncertainty related to realization of these
assets through future taxable income.

Note 7 - Subsequent Event

During September, 1998 the shareholders of the Company agreed to sell all of
the issued and outstanding shares of the Company's common stock to Redneck
Foods, Inc ("Redneck") The purchase price to be paid by Redneck (subject to
certain adjustments based upon a closing balance sheet audit) consists of
$2.0 million in cash and $3.4 million of convertible promissory notes bearing
interest at 10% and due in one year. The notes are convertible into common
stock of Redneck at the lower of $2.93 per share or the average daily bid
price for the thirty days prior to conversion. Additionally, Redneck will
issue to the sellers warrants to purchase 500,000 shares of its common stock
at the lower of $1.71 per share or the conversion price identified above.

<PAGE>56

WOODY'S BAR-B-Q HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED BALANCE SHEET
AS OF SEPTEMBER 27, 1998
(UNAUDITED)

ASSETS
CURRENT ASSETS
Accounts receivable $ 153,472
Other receivables 12,644
Inventory 30,354
Prepaid expenses 5,978
---------
Total current assets 202,448

PROPERTY AND EQUIPMENT - NET 593,829

OTHER ASSETS
Deferred loan costs 12,312
Due from related parties 117,469
Other assets 11,889
---------
TOTAL ASSETS $ 937,947
=========

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

CURRENT LIABILITIES
Current portion of long-term debt $ 63,163
Bank overdraft 99,405
Advertising trust fund 53,482
Accounts payable and
accrued expenses 686,984
---------
Total current liabilities 903,034
---------
LONG-TERM DEBT 612,903
---------
STOCKHOLDERS' EQUITY (DEFICIT)
Common stock, Class A $.01 par value, 50,000 shares
authorized, 10,000 shares issued and outstanding 100
Common stock, Class B, non-voting $.01 par value,
50,000 shares authorized, none issued or outstanding -
Additional paid in capital 34,492
Accumulated deficit (612,582)
---------
Total stockholders' equity (deficit) (577,990)
---------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) $ 937,947
=========

Read the accompanying notes to the financial statements

<PAGE>57

WOODY'S BAR-B-Q HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED STATEMENTS OF OPERATIONS AND ACCUMULATED DEFICIT
FOR THE NINE MONTHS ENDED SEPTEMBER 27, 1998 AND SEPTEMBER 30, 1997
(UNAUDITED)
<TABLE>
<CAPTION>
1998 1997
---------- -----------
<S> <C> <C>
REVENUE
Sales by company operated restaurants $3,712,560 $ 3,910,579
Franchise revenue 561,475 513,108
---------- -----------
Total revenue 4,274,035 4,423,687
---------- -----------

OPERATING COSTS AND EXPENSES
Food and beverage 1,413,173 1,524,243
Occupancy and other operating expenses 1,296,668 1,322,673
Selling, general and administrative
expenses 1,357,187 1,546,130
Depreciation and amortization 60,877 57,100
---------- ----------
Total operating expenses 4,127,905 4,450,146
---------- ----------

INCOME (LOSS) FROM OPERATIONS 146,130 (26,459)
---------- ----------
OTHER INCOME (EXPENSE)
Interest expense (45,085) (32,874)
Other income 4,271 63,074
---------- ----------
Total other income (expense) - net (40,814) 30,200
---------- ----------
INCOME BEFORE INCOME TAXES 105,316 3,741

PROVISION FOR INCOME TAXES - -
---------- ----------
NET INCOME 105,316 3,741

ACCUMULATED DEFICIT - BEGINNING OF PERIOD (717,898) (518,465)
---------- ----------
ACCUMULATED DEFICIT - END OF PERIOD $ (612,582) $ (514,724)
========== ==========
</TABLE>

Read the accompanying notes to the financial statements

<PAGE>58

WOODY'S BAR-B-Q HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 27, 1998 AND SEPTEMBER 30, 1997
(UNAUDITED)

CASH FLOWS FROM OPERATING ACTIVITIES $ 194,453 $ 14,704
---------- ----------

CASH FLOWS FROM INVESTING ACTIVITIES (59,350) (74,504)
---------- ----------

CASH FLOWS FROM FINANCING ACTIVITIES (168,467) 59,800
---------- ----------

NET INCREASE (DECREASE) IN CASH (33,364) -

CASH - BEGINNING OF PERIOD 33,364 -
---------- ----------

CASH - END OF PERIOD $ - $ -
========== ==========
</TABLE>

Read the accompanying notes to the financial statements

<PAGE>59

WOODY'S BAR-B-Q HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
AS OF SEPTEMBER 27, 1998

Note 1 -. Basis of presentation

The accompanying unaudited financial statements have been prepared in
accordance with generally accepted accounting principles for interim
financial information and Item 310 of Regulation S-B. They do not include all
of the information and footnotes required by generally accepted accounting
principles for complete financial statements. In the opinion of management,
all adjustments (consisting only of normal recurring adjustments) considered
necessary for a fair presentation have been included. The results of
operations for the periods presented are not necessarily indicative of the
results to be expected for the full year. For further information, refer to
the financial statements of the Company as of December 28, 1997 included
elsewhere in this filing.

Note 2 -. Commitments and Contingencies

Concentration - major supplier

The Company utilizes a single source (Sysco Food Services) for the majority
of its food purchases. The Company believes that the loss of this source
would not materially impact its operations as there are a number of suppliers
which could meet the Company's needs.

Note 3 - Stockholders' Equity

During September, 1998 the shareholders of the Company agreed to sell all of
the issued and outstanding shares of the Company's common stock to Redneck
Foods, Inc. ("Redneck"). The purchase price to be paid by Redneck (subject to
certain adjustments based upon a closing balance sheet audit) consists of $2
million in cash and $3.4 million of convertible promissory notes bearing
interest at 10% and due in one year. The notes are convertible into common
stock of Redneck at the lower of $2.93 per share or the average daily bid
price for the thirty days prior to conversion. Additionally, Redneck will
issue to the sellers warrants to purchase 500,000 shares of its common stock
at the lower of $1.71 per share or the conversion price identified above.

Unaudited pro forma financial data for the nine month periods as if the
transaction had occurred at the beginning of the period is as follows:

September 27, 1998 September 30, 1997
------------------ ------------------
(In Thousands)

Revenue $ 4,564 $ 4,424
(Loss) from continuing operations $(2,047) $ (956)
Net (loss) $(2,047) $ (956)
Basic (loss) per share $ (.23) $ (.17)

<PAGE>60
PART II
INFORMATION NOT REQUIRED BY PROSPECTUS

Item 24. Indemnification of Officers and Directors.

The By-Laws of the Company provides that a director of the registrant
shall have no personal liability to the Registrant or its stockholders for
monetary damages for breach of a fiduciary duty as a director, except for
liability (a) for any breach of the director's duty of loyalty to the
Registrant or its stockholders, (b) for acts and omissions not in good faith
or which involve intentional misconduct or a knowing violation of law, and
(c) pursuant to Canadian law for any transaction form which the director
derived an improper personal benefit. Registrant's By-Laws exculpates and
indemnifies the directors, officers, employees, and agents of the registrant
from and against certain liabilities. Further the By-Laws also provides that
the Registrant shall indemnify to the full extent permitted under Canadian
law any director, officer employee or agent of Registrant who has served as
a director, officer, employee or agent or the Registrant or, at the
Registrant's request, has served as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise.

INDEMNIFICATION OF OFFICERS OR PERSONS CONTROLLING THE COMPANY
FOR LIABILITIES ARISING UNDER THE SECURITIES ACT OF 1933, IS HELD TO BE
AGAINST PUBLIC POLICY BY THE SECURITIES AND EXCHANGE COMMISSION AND IS
THEREFORE UNENFORCEABLE.

Item 25. Other Expenses of Issuance and Distribution.

Other expenses in connection with this offering which will be paid
by Casinovations Incorporated (hereinafter in this Part II referred to as
the "Company") are estimated to be substantially as follows:
<TABLE>
Amount
Payable
Item By Company
<S> <C>
S.E.C. Registration Fees $1,030.57
State Securities Laws (Blue Sky) Fees and Expenses 3,500.00
Printing and Engraving Fees 7,500.00
Legal Fees 15,000.00
Accounting Fees and Expenses 33,000.00
Transfer Agent's Fees 1,500.00
Miscellaneous 2,500.00
---------
Total $64,030.57
</TABLE>

Item 26. Recent Sales of Unregistered Securities.

In February 1997, the Company entered into a promotion agreement with Jeff
Foxworthy. In consideration for the agreement to provide future promotional
services, the Company sold 2,500,000 Series A Preferred Shares at $.02 per
Series A Preferred Share to Mr. Foxworthy. This issuance was made in reliance
on Section 4(2) by Registrant's management to a sophisticated investor who
had access to information on the Company necessary to make an informed
investment decision.

In February 1997, the Company entered into an agreement to sell 5,100,000
shares of founders stock to David Womick, president of the Company which was
assigned a value of $.02 per share. This issuance was made in reliance on
Section 4(2) by Registrant's management to a sophisticated investor who had
access to information on the Company necessary to make an informed investment
decision.

In June 1997, the Company entered into two consulting contracts that provided
for the issuance of 1,000,000 shares of common stock (Shannon/Rosenbloom
Marketing, Inc.(500,000) and Little Pond Enterprises, Inc.(300,000).in lieu
of cash for consulting services at the price of $.10 per share. The share
price was based on the negotiated value in arm's length transactions in
February, 1997 when the Company had little or no value. These sales were
made pursuant to an exemption from registration pursuant to Section 504 of
Regulation D. Although the appropriate Form D was not timely filed with the
Securities and Exchange Commission, the offering was approved and/or exempted
by the required states.

In June 1997, the Company also issued 416,000 restricted stock valued at $.10
per Common Share pursuant to the Act in consideration for (1) directors fees
for services to be rendered over the 12 month period beginning in February
1997 (at which time the value of these services was established) and (2) in
accordance with various employment contracts in connection with services
rendered to assist in the development of the Company and the raising of the
initial capital. Since there was no established market at the time these
agreements were made, the same value per share was used on all issuances,
although the actual shares were not issued until a later date. This issuances
were made in reliance on Section 4(2) by Registrant's management to
sophisticated investors who had access to information on the Company
necessary to make an informed investment decision.

<PAGE>61

In July 1997, the Company sold 156,000 Common Shares to various individuals
for cash at $.75 per Common Share to raise start-up capital. These issuances
were made in reliance on Section 4(2) by Registrant's management to
sophisticated investors who had access to information on the Company
necessary to make an informed investment
decision.

In October 1997, the Company completed an offering of 920,000 Common Shares
under Rule 504 of Regulation D of the Securities Act of 1933 at $1.00 per
Common Share to the following:

Name # of Common Shares

Charles R. Caraway 55,000
Herman R. Loeb
for further credit Charles R. Caraway 55,000
David Adams 5,000
Karen M. Adams 10,000
Valerie I. Moore 10,000
William G. Osler 5,000
Kevin Robinson 6,500
Robert L. Watson II 15,000
Dale R. & Karen F. Benson 5,000
Hal Morrison 24,000
John D. McDonald 15,000
John D. King 7,500
Wilhelm Sumser 10,000
Louise & Allen Jensen 35,000
William Wolfe 5,000
Judith Gottschalk 50,000
Norbert H. Sumser 45,000
Robert Gottschalk 140,000
Jeffrey L. Hutchinson 10,000
Robert Ichikaw 7,000
Ofelia Albarran & Maurilio Serrano 10,000
Jeff Knepp 30,000
Timothy John Cecconi & Kelly Cecconi 20,000
Dennis Knepp 5,000
Donald Anthony 25,000
Maurice Bledsoe 5,000
Timothy A. Leugers 33,000
Jeff E. Fuqu 5,000
Thomas Demid 5,000
Robert Amodeo 5,000
William F & Elene D. Boyd 20,000
Monica N. Galea 10,000
Brian Gentile 6,000
Francesco Di Marco 10,000
Harry Faddis 15,000
Scott A. Artz 20,000
Fred Glazer 20,000
Robert A. Baydale 10,000
Ginger Tracey 5,000
Stuart Kordonowy 20,000
Ali Steinbach 20,000
Randall K. Kopelman 10,000
Robert L. Kazaros 10,000
Timothy B. Shannon 10,000
Patrick V. Casey 10,000
Deborah N. Fischbach 10,000
Mary Ann Lang 61,000
Thomas V.N. Bass 5,000

These sales were made pursuant to an exemption from registration pursuant to
Section 504 of Regulation D. The offering was approved and/or exempted by
the required states and the appropriate Form D was filed with the Securities
and Exchange Commission.

In February, 1998, the Company entered into a contract to acquire the real
estate and the equipment and leasehold interest of a restaurant in Asheville,
North Carolina to be converted to a Foxworthy's Smokehouse Grill. The
Company issued 223,333 shares of Common Stock valued at $3.00 per Common
Share for the equipment and the leasehold interest. This issuance was made in
reliance on Section 4(2) by Registrant's management to sophisticated
investors who had access to information on the Company necessary to make an
informed investment decision.

In the second quarter of 1998, the Company issued Common Shares to the
following individuals in cash.

# of shares Amount per Share Amount Paid
Ray E. Justice, Sr. 25,000 $2.00 $50,000
160,000 $1.875 $300,000
Timothy Miles 16,000 $1.875 $30,000
Fred Glaser 40,000 $1.875 $75,000
Robert A. Baydale 160,000 $1.875 $300,000
John R Geise 27,500 $2.00 $55,000

<PAGE>62

These issuances were made in reliance on Section 4(2) by Registrant's management
to sophisticated investors who had access to information on the Company
necessary to make an informed investment decision.

During the third quarter of 1998, the Company issued Series 1 Secured
Convertible Debentures to the following:

Name Principal amount of Debentures
Sergio Boneeti $100,000
Aldo Nenzi $200,000
Correllus International Ltd. $100,000
Arab Commerce Bank Ltd. $125,000
Robert Rabin $50,000
Sandro Grimaldi $150,000
Oscar Brito $150,000
Galapaco Holdings Ltd. $300,000
Aliouros Ltd. $50,000
Muzzolon Piermarlo $100,000

These sales were made pursuant to an exemption from registration pursuant to
Section 506 of Regulation D. Based on representations made by the investors
in their subscription agreements, all of the investors were accredited. The
offering was approved and/or exempted by the required states and the
appropriate Form D was filed with the Securities and Exchange Commission.

In the third quarter of 1998, the Company issued Common Shares to the
following individuals for services.

# of shares Amount per Share Services valued at
Thomas V.N. Bass 1,500 $2.00 $3,000
Tom Geise 936 $2.00 $1,872

Item 27. Exhibit Index.
<TABLE>
<S> <C>
(1) Not Applicable
(2) Not Applicable
(3.1) Articles of Incorporation incorporated by reference for Form 10SB
filed April 27, 1998, File Number 0-24093
(3.2) Bylaws incorporated by reference for Form 10SB filed April 27, 1998,
File Number 0-24093
(4.1) Common Stock Certificate incorporated by reference for Form 10SB
filed April 27, 1998, File Number 0-24093
(4.2) Preferred Stock Certificate
(5) Consent and Opinion of Jody M. Walker regarding
legality of securities registered under this
Registration Statement and to the
references to such attorney in the Prospectus filed
as part of this Registration Statement
(6) Not Applicable
(7) Not Applicable
(8) Not Applicable
(9) Not Applicable
(10.1) License Agreement with Jeff Foxworthy incorporated by reference for
Form 10SB filed April 27, 1998, File Number 0-24093
(10.2) Stock Purchase Agreement with Jeff Foxworthy incorporated by
reference for Form 10SB filed April 27, 1998, File Number 0-24093
(10.3) Promotion Agreement with Jeff Foxworthy incorporated by reference
for Form 10SB filed April 27, 1998, File Number 0-24093
(10.4) Extension with Jeff Foxworthy incorporated by reference for Form
10SB filed April 27, 1998, File Number 0-24093
(10.5) Consulting Agreement with J.P. Williams incorporated by reference
for Form 10SB filed April 27, 1998, File Number 0-24093
(10.6) Consulting Agreement with Little Pond Enterprises, Inc.
incorporated by reference for Form 10SB filed April 27, 1998,
File Number 0-24093
(10.7) Joint Venture Agreement with Pigs"R"Us incorporated by reference
for Form 10SB filed April 27, 1998, File Number 0-24093
(10.8) Marketing Agreement with Shannon/Rosenbloom Marketing, Inc.
incorporated by reference for Form 10SB filed April 27, 1998,
File Number 0-24093
(10.9) Buyer-Broker Agreement with Business Intermediary Services
incorporated by reference for Form 10SB filed April 27, 1998,
File Number 0-24093
(10.10) Arbitration Agreement incorporated by reference for Form 10SB
filed April 27, 1998, File Number 0-24093
(10.11) Berstein Employment Agreement incorporated by reference for Form
10SB filed April 27, 1998, File Number 0-24093
(10.12) Proprietary Rights and Confidentiality Agreement incorporated by
reference for Form 10SB filed April 27, 1998, File Number 0-
24093
(10.13) Registration Rights Agreement incorporated by reference for Form
10SB filed April 27, 1998, File Number 0-24093
(10.14) OTC Communications Corp. Consulting Agreement incorporated by
reference to Amendment 1 of Form 10SB filed September 29, 1998

<PAGE>63

(10.15) Letter of Understanding with The Wall Street Group, Inc.
incorporated by reference to Amendment 1 of Form 10SB filed
September 29, 1998
(10.16) Termination of Pigs "R" Us Joint Venture dated September 17, 1998
incorporated by reference to Amendment 1 of Form 10SB filed
September 29, 1998
(10.17) Amended and Restated Stock Purchase Agreement dated August 20, 1998
by and between the Company and Woody's Bar-B-Q Holdings, Inc.
and extensions incorporated by reference to Form 8-K dated
September 11, 1998
(11) Not Applicable
(12) Not Applicable
(13) Not Applicable
(14) Not Applicable
(15) Not Applicable
(16) Not Applicable
(17) Not Applicable
(18) Not Applicable
(19) Not Applicable
(20) Not Applicable
(21) Not Applicable
(22) Not Applicable
(23) Not Applicable
(24) Consent of Crisp Hughes and Evans, Certified Public
Accountants
(24.1) Consent of Tubbs and Bartnick, P.A., Certified Public
Accountants
(25) Not Applicable
(26) Not Applicable
(27) Financial Data Schedule
(28) Not Applicable
(99) Not Applicable
</TABLE>

Item 28. Undertaking.

The undersigned registrant hereby undertakes:

(a)(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement:

(I) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;

(ii) To reflect in the prospectus any facts or events arising after the
effective date of the Registration Statement (or the most recent post-
effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the formation set forth in the Registration
Statement.

(iii) To include any additional or changed material information on the
plan of distribution.

(2) That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to
be the initial bona fide offering thereof.

(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.

(b) Delivery of Certificates.

The undersigned registrant hereby undertakes to provide to the
Transfer Agent at the closing, certificates in such denominations and
registered in such names as are required by the Transfer Agent to permit
prompt delivery to each purchaser.

Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the provisions set forth in
the Company's Articles of Incorporation or otherwise, the registrant has been
advised that in the opinion of the Securities and Exchange Commission, such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of
expenses incurred or paid by a director, officer or controlling person of the
registrant in the successful defense of any action, suit or proceeding) is
asserted by such director, officer or controlling person in connection with
the securities being registered, the registrant will, unless in the opinion
of its counsel the matter has been settled by controlling precedent, submit
to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.

<PAGE>64

SIGNATURES

In accordance with the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements of filing on Form SB-2 and authorized this
registration statement to be signed on its behalf by the undersigned, in the
City of Asheville, State of North Carolina on the 3rd day of December, 1998.

Redneck Foods, Inc.

/s/David Womick
--------------------------------
By: David Womick, President

In accordance with the requirements of the Securities Act of 1933, this
registration statement was signed by the following persons in the capacities
and on the dates stated.

<TABLE>

Signature Capacity Date
<S> <C> <C>

/s/David Womick Chief Executive Officer
- ------------------- Director December 3,1998

/s/Donald A. Theesfeld controller December 3,1998
- -------------------

/s/Erich K. Schmid Director December 3,1998
- -------------------

/s/James E. Scheifley Director December 3,1998
- ------------------- Principal Financial Officer

</TABLE>

<PAGE>65
Jody M. Walker
7841 South Garfield Way
Littleton, Colorado 80122
Telephone (303) 850-7637
Facsimile (303) 220-9902

November , 1998

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

Dear Sirs:

Re: OPINION RE: LEGALITY AND CONSENT OF COUNSEL TO USE OF NAME IN
THE REGISTRATION STATEMENT ON FORM SB-2 OF REDNECK FOODS, INC.

I am securities counsel for the above mentioned corporation and I have
prepared the registration statement on Form SB-2. I hereby
consent to the inclusion and reference to my name in the
Registration Statement on Form SB-2 for Redneck Foods, Inc.

It is my opinion that the securities of Redneck Foods, Inc. and those which
are registered with the Securities and Exchange Commission pursuant to Form
SB-2 Registration Statement of Redneck Foods, Inc. have been legally issued
and will be, when sold, legally issued, fully paid and non-assessable.

Yours very truly,

/s/ Jody M. Walker
--------------------

<PAGE>66

INDEPENDENT AUDITOR'S CONSENT

We do hereby consent to the use of our report dated March 24, 1998 on the
financial statements of Redneck Foods, Inc. as of December 31, 1997 included
in and made part of the registration statement of Redneck Foods, Inc. dated
December 3, 1998.

December 3, 1998

/s/ Crisp Hughes & Evans LLP
Certified Public Accountant

<PAGE>67

INDEPENDENT AUDITOR'S CONSENT

We do hereby consent to the use of our report dated October 26, 1998 on the
financial statements of Woody's Bar-B-Que Holdings, Inc. as of December 28,
1997 included in and made part of the registration statement of Redneck
Foods, Inc. dated November , 1998.

November , 1998

/s/ Tubbs and Bartnick, P.A.
Certified Public Accountant

<ARTICLE> 5

<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> SEP-27-1998
<CASH> 18,320
<SECURITIES> 0
<RECEIVABLES> 132,132
<ALLOWANCES> 0
<INVENTORY> 66,712
<CURRENT-ASSETS> 245,719
<PP&E> 243,260
<DEPRECIATION> 8,847
<TOTAL-ASSETS> 2,404,600
<CURRENT-LIABILITIES> 460,606
<BONDS> 0
<COMMON> 11,259
0
0
<OTHER-SE> 657,735
<TOTAL-LIABILITY-AND-EQUITY> 2,404,600
<SALES> 290,346
<TOTAL-REVENUES> 290,346
<CGS> 193,614
<TOTAL-COSTS> 193,614
<OTHER-EXPENSES> 1,698,217
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 2,371
<INCOME-PRETAX>
(1,597,959)
<INCOME-TAX> 0
<INCOME-CONTINUING>
(1,597,959)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME>
(1,597,959)
<EPS-PRIMARY> (.18)
<EPS-DILUTED> (.18)

</TABLE>