EAC INDUSTRIES INC, SB-2, 1997-08-01

EAC INDUSTRIES INC
SB-2, 1997-08-01
COMMERCIAL PRINTING

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<PAGE>

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 1, 1997

Registration No. 333-_________
===========================================================================

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
___________________

FORM SB-2
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
___________________

EAC INDUSTRIES, INC.
(Exact name of small business issuer as specified in its charter)

New York 2752 21-0702336
(State or other jurisdiction of (Primary Standard Industrial (I.R.S.
incorporation or organization) Classification Code Number) Employer
Identifica-
tion No.)

22 BLACKSTONE AVENUE
BRANFORD, CONNECTICUT 06405
(203) 315-8020
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)

PETER B. FRITZSCHE
CHAIRMAN AND CHIEF EXECUTIVE OFFICER
22 BLACKSTONE AVENUE
BRANFORD, CONNECTICUT 06405
(203) 315-8020
(Name, address, including zip code, and telephone number,
including area code, of agent for service)

Copy to:
DANIEL O'ROURKE
VEDDER, PRICE, KAUFMAN & KAMMHOLZ
222 NORTH LASALLE STREET
CHICAGO, ILLINOIS 60601
(312) 609-7669

Approximate date of commencement of proposed sale to the public: As
soon as practicable after this Registration Statement becomes effective.

If the form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. /_/

If this form is a post-effective amendment filed pursuant to
Rule 462(c) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. /_/

If the delivery of the Prospectus is expected to be made pursuant to
Rule 434, please check the following box. /_/

<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE

Title of each class of Proposed maximum Proposed maximum Amount of
securities to be Number of Shares offering price aggregate offering Registration
registered to be registered per unit price (1) fee

Common Stock
$.10 par value 2,283,551 $.22 $502,381 $152

</TABLE>

(1) Estimated solely for purposes of Rule 457.

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>
<PAGE>

EAC INDUSTRIES, INC.
--------------------

EXPLANATORY NOTE
----------------

This filing with the Securities and Exchange Commission constitutes both a
Registration Statement on Form SB-2 under the Securities Act of 1933, as
amended, and the filing of preliminary proxy material in connection with the
1997 Annual Meeting of Stockholders and the Company's Annual Report to
Stockholders for the Fiscal Year ended January 31, 1997. The final
prospectus will be mailed with the proxy and annual report to save costs and
expenses. This procedure was confirmed with William H. Carter, Special
Counsel, Office of the Chief Counsel, Division of Corporation Finance,
Securities and Exchange Commission, Washington, D.C.
<PAGE>
<PAGE>

PROSPECTUS
2,283,551 SHARES OF COMMON STOCK

EAC INDUSTRIES, INC.

Issuable Upon Exercise of
Rights to Subscribe for Such Shares
___________________

EAC Industries, Inc. (the "Company") is issuing to its stockholders of
record ("Recordholders") as of the close of business on October 1, 1997 (the
"Rights Record Date") non-transferable rights ("Rights") entitling
Recordholders to purchase an aggregate of 2,283,551 shares (the "Underlying
Shares") of the Company's Common Stock, par value $.10 per share (the
"Common Stock") at an exercise price of $.22 per share (the "Exercise
Price"). Recordholders will receive one (1.0) Rights for each share of
Common Stock held. No separate certificate evidencing the Rights will be
delivered to the Recordholders. No fractional Rights or cash in lieu
thereof will be issued or paid by the Company. Pursuant to their
subscription privilege, Rightsholders may purchase one full share of Common
Stock for each share of Common Stock held (the "Subscription Privilege").
No partial exercise is permitted.

The Rights will expire at 5:00 p.m., New York City time, on
October 31, 1997, unless extended as described herein (the "Expiration
Date"). A Recordholder may exercise Rights by delivering his properly
completed and executed Rights exercise agreement ("Rights Exercise
Agreement"), together with payment in full of the Exercise Price for each
Underlying Share subscribed for pursuant to the Subscription Privilege to
the offices of the Company by the Expiration Date.

Peter B. Fritzsche, the Chairman and Chief Executive Officer of the
Company and other members of the Board of Directors, as holders of
approximately 22% of the currently outstanding shares of Common Stock, have
agreed to exercise their Subscription Privileges in full.

The Common Stock is traded on the over-the-counter market under the
symbol EACI. On August ___, 1997, the last full day of trading before the
announcement of the Rights Offering, the last reported bid and ask prices of
the Common Stock were $______ and $______, respectively. On August ___,
1997, the last full day of trading before the effective date of the
Registration Statement, the last reported bid and ask prices of the Common
Stock were $_____ and $_____, respectively. The Rights, being non-
transferable, will not trade separately and will have no independent value.

Questions or requests for assistance or for additional copies of this
Prospectus may be directed to the Company at (203) 315-8020.
___________________

FOR INFORMATION CONCERNING CERTAIN FACTORS THAT SHOULD BE CONSIDERED
BY RECORDHOLDERS IN CONSIDERING AN INVESTMENT IN THE COMMON STOCK, SEE "RISK
FACTORS."
___________________

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION
OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

<TABLE>
<CAPTION>
Exercise Proceeds to
Price Company (1)
-------- -----------

<S> <C> <C>
Per Share. . . . $.22 $502,381
</TABLE>

_______________
(1) Before deduction of estimated expenses of this offering, estimated at
$40,000. There is no minimum subscription amount of the offering if
not all of the Rights are not exercised.

The date of this Prospectus is August ___, 1997.<PAGE>
<PAGE>

AVAILABLE INFORMATION

The Company is subject to the information requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports, proxy statements and other information
with the Securities and Exchange Commission (the "Commission"). Such
reports, proxy statements and other information may be inspected and copied
at the public reference facilities maintained by the Commission at Judiciary
Plaza, 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549; Seven
World Trade Center, 13th Floor, New York, New York 10007; and Citicorp
Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661.
Copies of such material can be obtained at prescribed rates from the Public
Reference Section of the Commission at 450 Fifth Street, N.W., Washington,
D.C. 20549. This information is also available on the Internet at the
Commission's website. The address for the website is: http://www.sec.gov.
In addition, material filed by the Company can be inspected at the offices
of the National Association of Securities Dealers, Inc. at 1735 K Street,
N.W., Washington, D.C., 20006.

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

This Prospectus physically incorporates the Company Notice and Proxy
Statement for its 1997 Annual Meeting of Stockholders, the Company's Annual
Report to Stockholders for the fiscal year ended January 31, 1997 and the
Company's Quarterly Report on Form 10-QSB for the quarterly period ended
April 30, 1997. This Prospectus also incorporates by reference certain
documents relating to the Company which are not delivered herewith. These
documents (other than the exhibits to such documents, unless such exhibits
are specifically incorporated by reference into such documents) are
available without charge, on oral or written request by any person to whom
this Prospectus is delivered. Written or telephone requests should be
directed to the Company to the attention of Peter B. Fritzsche, Chairman of
the Board and CEO, 22 Blackstone Avenue, Branford, Connecticut 06405, (203)
315-8020.

The following documents, which have been filed by the Company with the
Commission, are hereby incorporated by reference in this Prospectus:

(i) The Company's Annual Report on Form 10-KSB for the fiscal
year ended January 31, 1997;

(ii) The Company's Quarterly Report on Form 10-QSB for the
quarterly period ended April 30, 1997; and

(iii) The Company's Current Report on Form 8-K dated August
___, 1997.

All documents filed by the Company pursuant to Sections 13(a), 13(c),
14 or 15(d) of the Exchange Act subsequent to the date of this Prospectus
and prior to the termination of the offering of the Common Stock shall be
deemed to be incorporated by reference into this Prospectus and to be a part
hereof from the respective dates of filing of such documents. Any statement
contained in a document incorporated or deemed to be incorporated by
reference herein shall be deemed to be modified or superseded for purposes
of this Prospectus to the extent that a statement contained herein, or in
any other subsequently filed documents that also is or is deemed to be
incorporated by reference herein, modifies or supersedes such statement. Any
such statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this Prospectus.

2
<PAGE>
<PAGE>

PROSPECTUS SUMMARY

THE FOLLOWING SUMMARY IS QUALIFIED IN ITS ENTIRETY BY THE MORE
DETAILED INFORMATION AND CONSOLIDATED FINANCIAL STATEMENTS APPEARING
ELSEWHERE OR INCORPORATED BY REFERENCE HEREIN.

THE COMPANY

EAC Industries, Inc., the Company, was organized in 1958 as a New York
corporation. The Company is a holding company with three wholly-owned
operating subsidiaries, Goodren Products Corporation ("Goodren"), Flexible
Printed Products, Inc. ("Flexible") and Athena Packaging, Inc. ("Athena").
Goodren designs and produces point-of-purchase advertising displays and wall
decorations on semi-durable plastic. Goodren's major market is consumer
product manufacturers and one marketer of children's wall decorations.
Flexible produces and prints on plastic, pre-cure in-mold heat transfer
labels for the identification and decoration of rubber and silicone hoses,
belts and tire patches. Athena produces printed laminated, embossed and hot
stamped labels, wraps, seals and decals for the cosmetics, pharmaceutical
and health and beauty aids industries. Each of these subsidiaries sells
their products to customers throughout the United States.

THE RECAPITALIZATION OF THE COMPANY

At the 1997 Annual Meeting, the stockholders will be asked to approve
two related and successive stock splits which will have the effect of
cashing out the 28,136 shares of Common Stock owned by 1,080 odd-lot holders
(owners of fewer than 100 shares) of the Company's Common Stock
(the"Reclassification Proposal"). Such shares will be exchanged for the
right to receive cash of $.28125 per share (or $7,913 in total). Assuming
approval of the Reclassification Proposal, there will be 2,283,551 shares of
Common Stock outstanding as to which Rights will be issued and no Rights
will attach to the shares of Common Stock held by odd-lot holders.

RECENT EVENTS

[To Come, if Appropriate]

THE RIGHTS OFFERING

<TABLE>

<S> <C>

Rights . . . . . . . . . . . . Each record holder of Common Stock at the close of business on
the Rights Record Date ("Recordholders") will receive one
(1.0) non-transferable Rights for each share of Common Stock
held. Each Right entitles the holder thereof to purchase from
the Company one (1.0) share of Common Stock (an "Underlying
Share"). An aggregate of approximately 2,283,551 shares of
Common Stock will be sold in this offering upon the exercise of
Rights, assuming the exercise of all Rights. The distribution
of Rights and the sale of shares of Common Stock upon the
exercise of Rights are referred to herein as the "Rights
Offering."

Exercise Price . . . . . . . . $.22 per share of Common Stock (the "Exercise Price").

Subscription Privilege . . . . Rights holders ("Holders") are entitled to purchase for the
Exercise Price one Underlying Share for each Right held. See
"The Rights Offering--Subscription Privilege."

3
<PAGE>
<PAGE>

Potential Termination
of Subscription Privilege. . . If the Company believes that the issuance of Underlying Shares
pursuant to the Subscription Privilege will be unlawful under
the laws of any state, then the Company will have the right to
terminate such privileges upon receipt of advice of counsel to
the Company.

Method of Exercising Rights. . A Recordholder may exercise Rights by properly completing and
signing the Rights Exercise Agreement and forwarding such, with
payment of the full Exercise Price for each Underlying Share
subscribed for on or prior to the Expiration Date. See "The
Rights Offering--Method of Exercising Rights." No interest will
be paid on funds delivered in payment of the Exercise Price.

Rights Record Date . . . . . . October 1, 1997 which will be a date after the Reclassification
Proposal, if approved by the stockholders, will be made
effective. Stockholders of the Company whose shares of Common
Stock are converted into the right to receive cash in the
Reclassification Proposal will NOT be entitled to Rights with
respect to their shares.

Expiration Date. . . . . . . . 5:00 p.m., New York City time, on October 31, 1997, unless
extended by the Company at its option.

No Revocation. . . . . . . . . HOLDERS WHO EXERCISE THEIR RIGHTS WILL NOT BE ENTITLED TO REVOKE
THEIR SUBSCRIPTIONS.

Non-transferability. . . . . . Rights are non-transferable and no separate market for the
Rights can exist.

Amendments; Termination. . . . The Company reserves the right to amend the terms and conditions
of the offering made hereby or to terminate the Rights Offering
at any time prior to delivery of the shares of Common Stock
offered hereby. See "The Rights Offering--Amendments and
Waivers; Termination."

Persons Holding Shares
Through Others . . . . . . . . Persons holding shares of Common Stock and receiving the Rights
distributable with respect thereto through a broker, dealer,
commercial bank, trust company or other nominee should promptly
contact the appropriate institution or nominee and request it to
effect the transactions for them. See "The Rights Offering--
Exercise of Rights."

Certain Tax Consequences . . . Generally, Recordholders will not recognize any gain or loss
upon receipt or exercise of Rights. See "Certain Federal Income
Tax Consequences."

Shares Outstanding . . . . . . 2,311,687 as of August 20, 1997 and 2,283,551 shares assuming
completion of the Reclassification Proposal.

Shares Outstanding After
the Rights Offering. . . . . . 4,567,102, assuming that all Rights are exercised (the "Maximum
Subscription"); 2,797,530, assuming that no holder other than
the members of the Board of Directors of the Company exercise
Rights.

Exercise Agent . . . . . . . . The Company is acting as its own exercise agent. See "The
Rights Offering--Exercise Agent" for addresses and information
relating to the delivery of Rights Exercise Agreement and the
payment of the Exercise Price.

4
<PAGE>
<PAGE>

Use of Proceeds. . . . . . . . The purpose of the Rights Offering is to strengthen the
Company's capital structure and enhance its ability to obtain
future financing so as to enable the Company to grow through
both internal means and appropriate acquisitions. The net
proceeds to the Company from the sale of the Underlying Shares
will be approximately $462,000 if all of the Rights exercised.

Principal Stockholder
and the Board of Directors . . Peter B. Fritzsche, the Chairman of the Board and Chief
Executive Officer of the Company and the holder of approximately
20% of the currently outstanding shares of Common Stock, and
other members of the Board of Directors have agreed to exercise
their Subscription Privileges in full.

Over-the-Counter
Trading Symbol . . . . . . . . "EACI."

</TABLE>

See "Risk Factors" for a discussion of certain factors that should be
considered by Recordholders in evaluating an investment in Common Stock.

<TABLE>
<CAPTION>
SUMMARY SELECTED FINANCIAL DATA

Year Ended January 31, Three Months Ended April 30,
----------------------- ----------------------------
1997 1996 1997 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>

STATEMENT OF OPERATIONS DATA:
Net Sales $5,988,315 $7,659,689 $1,742,656 $1,705,804
Cost of products sold 4,392,978 5,435,681 1,240,253 1,194,225
Selling, general and administrative
expenses 2,054,633 2,092,565 476,036 549,253
---------- ---------- ---------- ----------
Gain on Sale of Fixed Assets 242,000 -- -- --
---------- ---------- ---------- ----------
Net (loss) income $ (161,270) $ 129,195 $ 17,947 $ (15,332)
========== ========== ========== ==========
Loss (income) per common share $ (.07) $ .06 $ .01 $ (.01)
========== ========== ========== ==========

April 30, 1997
---------------------
As
Actual Adjusted(1)
------ -----------
BALANCE SHEET DATA:
Working capital $ 687,617 $1,142,085
Total assets 3,349,632 3,804,100
Total liabilities 1,513,058 1,513,058
Shareholder's equity 1,836,574 2,291,042

</TABLE>

_______________
(1) To give effect to the Reclassification Proposal and the Rights
Offering, assuming the Maximum Subscription.

5
<PAGE>
<PAGE>

RISK FACTORS

In addition to the other information included in this Prospectus, the
following factors should be considered carefully by each prospective
purchaser of the Common Stock.

Current Operations

The Company realized $17,947 net income during the three months ended
April 30, 1997 versus a net loss of $15,332 for the three months ended
April 30, 1996. The Company incurred a $161,270 net loss in fiscal 1997
against profits of $129,195 for its 1996 fiscal year. Although the Company
is taking action to return itself to profitability, there can be no
assurance that the Company will be profitable in future periods. The
businesses the Company operates in are intensely competitive.

Leverage

The Company currently has a significant amount of outstanding
indebtedness. At April 30, 1997, the Company had long-term indebtedness
(excluding current maturities) of approximately $518,000. The degree to
which the Company is leveraged could have important consequences to the
Company, including: (i) increased vulnerability to adverse general economic
and industry conditions, (ii) impaired ability to obtain additional
financing for future working capital, capital expenditures, acquisitions,
general corporate purposes or other purposes, and (iii) dedication of a
substantial portion of the Company's cash flow from operations to the
payment of principal and interest on indebtedness, thereby reducing the
funds available for operations and future business opportunities.

Continuation of Net Operating Loss Carryforwards

The Company currently has net operating loss carryforwards for Federal
income tax purposes of approximately $7 million. Acquisitions of Common
Stock by persons who are not currently holders of Common Stock, could result
in an "ownership change" within the meaning of section 382 of the Internal
Revenue Code of 1986, as amended (the "Code"), thereby imposing an annual
limitation (the "Section 382 Limitation") on the Company's ability to
utilize the net operating loss carryforward to reduce future taxable income.
Specifically, in the event of an "ownership change," the Company's
utilization of its net operating loss carryforwards would be limited to an
annual amount equal to the product of the equity value of the Company at the
time of such "ownership change" (subject to reduction with respect to
certain recent increases in value) multiplied by the long-term tax-exempt
rate as published monthly by the Internal Revenue Service, without extending
the expiration date of the net operating loss carryforwards. The long-term
tax-exempt rate is currently 5.64%; such rate, however, is subject to change
and it is impossible to predict whether the equity value of the Company and
such rate will increase or decrease, and to what extent. See "Certain
Federal Income Tax Consequences--Tax Consequences to Company."

The Company does not believe that the issuance of Underlying Shares
pursuant to the Subscription Privilege will cause an "ownership change."
Notwithstanding the foregoing, the Rights Offering may increase the
likelihood that an "ownership change" will occur in the future, and it is
impossible for the Company to ensure that such "ownership change," will not
occur, in part because the Company has no ability to restrict the
acquisition or disposition of Common Stock by persons whose ownership could
cause an "ownership change." In addition, the Company may in the future
take certain actions which could give rise to an ownership change, if in the
exercise of the business judgment of the Company such actions are necessary
or appropriate. If an "ownership change" were to occur subsequent to the
Rights Offering, the Section 382 Limitation could have a material adverse
impact upon the Company's earnings and upon the Company's cash flow.

Dilution of Ownership

Recordholders who do not exercise their Rights face the possibility
that their percentage of ownership in the Company will be diluted by the
Rights Offering.

6
<PAGE>
<PAGE>

Principal Stockholder

Peter B. Fritzsche, the Chairman of the Board and CEO of the Company,
owns approximately 20% of the currently outstanding shares of Common Stock
and has agreed that he will exercise its Subscription Privilege in full.
Accordingly, upon consummation of the Rights Offering, Mr. Fritzsche will
continue to own at least 20% of the outstanding shares of Common Stock.
Depending upon the number of shares subscribed for by others, the percentage
of the outstanding Common Stock owned by Mr. Fritzsche upon completion of
the Rights Offering will range from approximately 20% (in the event that all
stockholders exercise their Rights in full) to approximately 34% if only the
members of the Board of Directors other than Mr. Fritzsche exercise.

Dividend Restrictions

The Company has not paid dividends on the Common Stock for more than
ten years. The Company does not expect to pay any cash dividends in the
foreseeable future and intends to continue to retain any earnings for the
Company's operations. See "Price Range of Common Stock and Dividends" and
"Description of Capital Stock--Common Stock."

Market Considerations

There can be no assurance that the market price of the Common Stock
will not decline during the subscription period or that, following the
issuance of the Rights and the sale of the Underlying Shares upon exercise
of Rights, a subscribing Recordholder will be able to sell shares purchased
in the Rights Offering at a price equal to or greater than the Exercise
Price. The election of a Recordholder to exercise Rights in the Rights
Offering is irrevocable. Moreover, until certificates are delivered,
subscribing Recordholders may not be able to sell the shares of Common Stock
that they have purchased in the Rights Offering. Certificates representing
shares of Common Stock purchased will be delivered as soon as practicable
after consummation of the Rights Offering.

No interest will be paid to Recordholders on funds delivered to the
Company pursuant to the exercise of Rights pending delivery of Underlying
Shares.

7
<PAGE>
<PAGE>

THE COMPANY

EAC Industries, Inc. is a holding company with three operating
subsidiaries: Goodren Products Corporation ("Goodren"), Athena Packaging,
inc. ("Athena") and Flexible Printed Products, Inc. ("Flexible"). Goodren
designs and provides point-of-purchase advertising displays and wall
decorations on semi-durable plastic. Athena produces printed, laminated
embossed and hot-stamped labels, wraps, seals and decals for the cosmetics,
pharmaceutical and health and beauty aids industries. Flexible produces and
prints on plastic, pre-cure in-mold heat transfer labels for the
identification and decoration of rubber and silicone hoses, belts and tire
patches.

The Company was incorporated in 1958 under the laws of the State of
New York. Its executive offices are located at 22 Blackstone Avenue,
Branford, Connecticut 06405, and its telephone number is (203) 315-8020.
Further information on the business of the Company is contained in the
Annual Report to Stockholders attached hereto and made a part hereof.

THE RECLASSIFICATION PROPOSAL

At the 1997 Annual Meeting, the stockholders will be asked to approve
two related and successive stock splits which will have the effect of
cashing out the 28,136 shares of Common Stock owned by 1,080 odd-lot holders
(fewer than 100 shares) of the Company's Common Stock (the"Reclassification
Proposal"). Such shares will be exchanged for the right to receive cash of
$.28125 per share ($7,913 in total). Assuming approval of the
Reclassification Proposal, there will be 2,283,551 shares of Common Stock
outstanding. The odd-lot holders will NOT be entitled to receive Rights in
the Rights Offering.

RECENT EVENTS

[To Come, if Appropriate]

PRICE RANGE OF COMMON STOCK AND DIVIDENDS

See the Company's 1997 Annual Report attached hereto at p. 4 thereof
for such information.

8
<PAGE>
<PAGE>

CAPITALIZATION

The following table sets forth the capitalization of the Company and
its consolidated subsidiaries as of April 30, 1997, and as adjusted to
reflect the effectuation of the Reclassification Proposal and the Rights
Offering, assuming the Maximum Subscription. This table should be read in
conjunction with the Consolidated Financial Statements of the Company and
related Notes thereto attached to this Prospectus in the Company's 1997
Annual Report to Stockholders and the Quarterly Report on Form 10-QSB for
the quarterly period ended April 30, 1997.

As of April 30, 1997
---------------------
Actual As Adjusted
------ ------------
(dollars in thousands)

Current maturities of long-term debt . . . . . . . . . . . . . . . . . . $ 90,342 $ 90,342
Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 518,040 518,040

Stockholders' equity:
Common Stock, $.10 par value; 20,000,000 shares authorized; 2,311,687
shares issued and outstanding (and 4,567,102 shares as adjusted) . . 231,169 456,710
Capital in excess of par value . . . . . . . . . . . . . . . . . . . . . 10,454,540 10,683,467
Retained earnings (deficit). . . . . . . . . . . . . . . . . . . . . . . (8,849,135) (8,849,135)
----------- ----------

Total stockholders' equity . . . . . . . . . . . . . . . . . . . . . 1,836,574 2,291,042
=========== ==========
Total capitalization . . . . . . . . . . . . . . . . . . . . . . . . $ 2,444,956 $ 2,899,424
=========== ==========
</TABLE>

USE OF PROCEEDS

The purpose of the Rights Offering is to strengthen the Company's
capital structure and enhance its ability to obtain future financing so as
to enable the Company to grow through both internal means and appropriate
acquisitions. The Company currently has no written or oral agreements with
respect to any pending acquisitions. In the event of the Maximum
Subscription, the net proceeds to the Company are estimated to be
approximately $462,000. The Company intends to use the net proceeds from
the sale of the Underlying Shares to add to working capital and to
temporarily repay some indebtedness under the Company's credit agreement.
This credit agreement is a one-year revolving line of credit with The Chase
Manhattan Bank in the aggregate amount of $500,000. Interest is computed at
prime, plus 2%. The agreement expires on March 31, 1998.

9
<PAGE>
<PAGE>

DILUTION

At April 30, 1997, the net tangible book value of the Company was
$1,390,905 or $.60 per share. Net tangible book value per share represents
the Company's tangible assets less total liabilities. Net tangible book
value dilution per share represents the difference between the amount per
share of Common Stock paid by the Recordholders in the Rights Offering and
the pro forma net tangible book value per share of Common Stock immediately
after completion of the Rights Offering (and assuming the Maximum
Subscription). After giving effect to: (i) the sale by the Company of the
2,283,551 Shares of Common Stock offered hereby and (ii) the effectiveness
of the Recapitalization Proposal, the pro forma net tangible book value of
the Company at April 30, 1997, would have been $1,845,373, or $.40 per
share. This represents an immediate decrease in net tangible book value of
$.20 per share to Recordholders as illustrated by the following table:

<TABLE>

Price to Recordholders $0.22

Net tangible book value at April 30, 1997 $0.60

Decrease in net tangible book value attributable to
new stock issued pursuant to the Rights Offering (1) 0.20
-----
Net tangible book value after the Rights Offering and the
Recapitalization Proposal (2) $0.40

</TABLE>

_______________
(1) Assuming the Maximum Subscription and after deduction of offering
expenses of approximately $40,000 payable by the Company.

(2) There is no dilution in the aggregate net asset value of the Common
Stock held by a Recordholder exercising his Rights.

10
<PAGE>
<PAGE>

SELECTED HISTORICAL FINANCIAL DATA

The following selected financial data of the Company for the fiscal
years ended January 31, 1997 and 1996 are derived from the financial
statements, physically incorporated into this Prospectus by the Company's
Annual Report to Stockholders being attached hereto, which financial
statements have been audited by Lazar, Levine & Company, LLP, independent
public accountants, as indicated in their report included therein. The
selected financial data as of April 30, 1997 and for the three (3) months
ended April 30, 1997 and 1996 have been derived from the Company's unaudited
financial statements, which are included in the Company's Form 10-QSB Report
attached hereto and which, in the opinion of the Company's management,
contain all adjustments, consisting of normal adjustments necessary for a
fair presentation of the financial position and results of operations. The
operating results for the three (3) months ended April 30, 1997 are not
necessarily indicative of the results for the full year of operations. The
Selected Historical Financial Data should be read in conjunction with the
financial statements and related notes thereto and "Management's Discussion
and Analysis of Operations" included in the Annual Report to Stockholders
and the Company's Form 10-QSB Report attached hereto.

Year Ended January 31, Three Months Ended April 30,
----------------------- ----------------------------
1997 1996 1997 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>

STATEMENT OF OPERATIONS DATA:
Net Sales $5,988,315 $7,659,689 $1,742,656 $1,705,804
Cost of products sold 4,392,978 5,435,681 1,240,253 1,194,225
Selling, general and administrative
expenses 2,054,633 2,092,565 476,036 549,253
Gain on Sale of Fixed Assets 242,000 -- -- --
---------- ---------- ---------- ----------
Net (loss) income $ (161,270) $ 129,195 $ 17,947 $ (15,332)
========== ========== ========== ==========
Loss (income) per common share $ (.07) $ .06 $ .01 $ (.01)
========== ========== ========== ==========

</TABLE>

_______________
(1) To give effect to the Reclassification Proposal and the Rights
Offering, assuming the Maximum Subscription.

11
<PAGE>
<PAGE>

THE RIGHTS OFFERING

The Rights

The Company is issuing the Rights to Recordholders at no charge to
such Recordholders. The Company is issuing one (1.00) Rights for each share
of Common Stock held on the Rights Record Date. The Rights are not evidenced
by any certificate, rather are set forth in the books of the Company. Such
rights are not transferable.

Expiration Date

The Rights will expire at 5:00 p.m., New York City time, on
October 31, 1997, subject to extension in the discretion of the Company.
After the Expiration Date, unexercised Rights will be null and void. The
Company will not be obligated to honor any purported exercise of Rights
received by the Company after the Expiration Date, regardless of when the
documents relating to that exercise were sent.

Subscription Privilege

Each Right entitles the holder thereof to purchase at the Exercise
Price one Underlying Share (the " Subscription Privilege"). The Right has
been established on the books of the Company. The Right is non-
transferable. Certificates representing Underlying Shares purchased
pursuant to the Subscription Privilege will be delivered to subscribers as
soon as practicable after the Expiration Date.

Exercise of Rights

Holders may exercise their Rights by delivering to the Company, at the
address specified below, at or prior to the Expiration Date, the properly
completed and executed Rights Exercise Agreement, with any signatures
guaranteed as required, together with payment in full of the Exercise Price
for each Underlying Share subscribed for. Payment may only be made by check
or bank draft drawn upon a U.S. bank payable to the Company. If paying by
uncertified personal check, please note that the funds paid thereby may take
at least five business days to clear. Accordingly, holders of Rights who
wish to pay the Exercise Price by means of uncertified personal check are
urged to make payment sufficiently in advance of the Expiration Date to
ensure that such payment is received and clears by such time. All funds
received in payment of the Exercise Price shall be held by the Company and
invested at the direction of the Company in short-term certificates of
deposit, short-term obligations of the United States, any state or any
agency thereof, or money market mutual funds investing in the foregoing
instruments. Earnings on such funds will be retained by the Company.

THE ADDRESS TO WHICH THE RIGHTS EXERCISE AGREEMENT AND PAYMENT OF THE
EXERCISE PRICE SHOULD BE DELIVERED IS:

EAC INDUSTRIES, INC.
22 BLACKSTONE AVENUE
BRANFORD, CONNECTICUT 06405

THE COMPANY'S TELEPHONE NUMBER IS (203)315-8020.

Recordholders who hold shares of Common Stock for the account of
others, such as brokers, trustees or depositaries for securities, should
contact the respective beneficial owners of such shares as soon as possible
to ascertain those beneficial owners' intentions and to obtain instructions
with respect to their Rights. If a beneficial owner so instructs, the
record holder of that beneficial owner's Rights should complete appropriate
Rights Exercise Agreement and submit them to the Exercise Agent with the
proper payment. In addition, beneficial owners of Common Stock or Rights
held through such a nominee holder should contact the nominee holder and
request the nominee holder to effect transactions in accordance with the
beneficial owner's instructions.

12
<PAGE>
<PAGE>

The Instructions accompanying the Rights Exercise Agreement should be
read carefully and followed in detail. RIGHTS EXERCISE AGREEMENTS SHOULD BE
SENT WITH PAYMENT TO THE COMPANY. DO NOT SEND RIGHTS EXERCISE AGREEMENTS TO
THE TRANSFER AGENT.

THE METHOD OF DELIVERY OF RIGHTS EXERCISE AGREEMENTS AND PAYMENT OF
THE EXERCISE PRICE TO THE COMPANY ARE AT THE ELECTION AND RISK OF THE
RECORDHOLDERS. IF SENT BY MAIL, RECORDHOLDERS ARE URGED TO SEND RIGHTS
EXERCISE AGREEMENTS AND PAYMENTS BY REGISTERED MAIL, PROPERLY INSURED, WITH
RETURN RECEIPT REQUESTED, AND ARE URGED TO ALLOW A SUFFICIENT NUMBER OF DAYS
TO ENSURE DELIVERY TO THE COMPANY AND CLEARANCE OF PAYMENT PRIOR TO THE
EXPIRATION DATE. BECAUSE UNCERTIFIED PERSONAL CHECKS MAY TAKE AT LEAST FIVE
BUSINESS DAYS TO CLEAR, RECORDHOLDERS ARE STRONGLY URGED TO PAY, OR ARRANGE
FOR PAYMENT, BY MEANS OF A CERTIFIED OR CASHIER'S CHECK.

All questions concerning the timeliness, validity, form and
eligibility of any exercise of Rights will be determined by the Company,
whose determinations will be final and binding. The Company, in its sole
discretion, may waive any defect or irregularity, or permit a defect or
irregularity to be corrected within such time as it may determine, or reject
the purported exercise of any Right. Rights Exercise Agreements will not be
deemed to have been received or accepted until all irregularities have been
waived or cured within such time as the Company determines, in its sole
discretion. The Company Agent will not be under any duty to give
notification of any defect or irregularity in connection with the submission
of Rights Exercise Agreements or incur any liability for failure to give
such notification.

Any questions or requests for assistance concerning the method of
exercising Rights or requests for additional copies of this Prospectus, the
Instructions or the Rights Exercise Agreement should be directed to the
Company at its address set forth above (telephone (203) 315-8020).

No Revocation

ONCE A HOLDER OF RIGHTS HAS PROPERLY EXERCISED THE SUBSCRIPTION
PRIVILEGE, SUCH EXERCISE MAY NOT BE REVOKED.

No Transferring Rights

Rights may not be transferred or purchased or sold.

Amendments and Waivers; Termination

The Company reserves the right to extend the Expiration Date and to
amend the terms and conditions of the Rights Offering, whether the amended
terms are less or more favorable to the Recordholders. In the event that
the Company amends the terms of the Rights Offering, the Registration
Statement of which this Prospectus forms a part will be amended, a new
definitive Prospectus will be distributed to all Recordholders who have
theretofore exercised Rights and to holders of record of unexercised Rights
on the date the Company amends such terms. All Recordholders who have
theretofore exercised Rights shall simultaneously be provided with a form of
Consent to Amended Rights Offering Terms, on which they may confirm their
exercise of Rights under the terms of the Rights Offering as amended by the
Company; any Recordholder who has theretofore exercised any Rights and who
does not return such Consent within 10 business days after the mailing
thereof by the Company shall be deemed to have canceled his or her exercise
of Rights, and the full amount of the Exercise Price theretofore paid by
such Recordholder will be returned promptly by mail, without interest or
deduction. Any completed Rights Exercise Agreement received by the Company
five or more business days after the date of the amendment will be deemed to
constitute the consent of the Recordholder who completed such Rights
Exercise Agreement to the amended terms. The Company reserves the right, in
its sole discretion, at any time prior to delivery of the Underlying Shares
to terminate the Rights Offering by making a public announcement thereof.
If the Rights Offering is so terminated, all funds received from
Recordholders will be promptly refunded without interest.

13
<PAGE>
<PAGE>

Determination of Exercise Price

The Exercise Price was determined by the Company, based on a number of
factors. The Company believes that the Exercise Price reflects the
Company's objective of achieving the maximum net proceeds obtainable from
the Rights Offering while providing the holders of Common Stock with an
opportunity to make an additional investment in the Company, and thus avoid
an excessive dilution of their ownership position in the Company.

In approving the Exercise Price, the Board of Directors considered
such factors as the alternatives available to the Company for raising
capital, the market price of the Common Stock, the business prospects for
the Company and the general condition of the securities markets at the time
of the meeting of the Board of Directors at which the Rights Offering was
approved. There can be no assurance however, that the market price of the
Common Stock will not decline during the subscription period to a level
equal to or below the Exercise Price, or that, following the issuance of the
Rights and of the Common Stock upon exercise of Rights, a subscribing
Recordholder will be able to sell shares purchased in the Rights Offering at
a price equal to or greater than the Exercise Price.

Subscription by Principal Stockholder

Peter B. Fritzsche owns approximately 20% of the Common Stock
currently outstanding and has agreed to exercise his Subscription Privilege
in full. Other members of the Board of Directors own 42,775 shares of
Common Stock and they intend to fully exercise their Subscription
Privileges. Depending upon the exercise of Subscription Privileges by other
Recordholders, the percentage of the outstanding Common Stock owned by
Mr. Fritzsche upon completion of the Rights Offering will range from
approximately 20% (in the event that all Recordholders exercise their Rights
in full) to approximately 34% (assuming that only members of the Board of
Directors other than Mr. Fritzsche also exercise Rights).

No Board Recommendation

An investment in the Common Stock must be made pursuant to each
investor's evaluation of its, his or her best interests. Accordingly,
although the Board of Directors of the Company unanimously approved the
Rights Offering, it makes no recommendation to Holders regarding whether
they should exercise their Rights.

DESCRIPTION OF CAPITAL STOCK

The Company's authorized capital stock consists of 20,000,000 shares
of Common Stock, par value $.10 per share. The following summary
description of the capital stock of the Company does not purport to be
complete and is qualified in its entirety by reference to the Company's
Restated Certificate of Incorporation, a copy of which is incorporated by
reference as an exhibit to the registration statement of which this
Prospectus forms a part, and to New York corporate law.

The holders of Common Stock are entitled to receive, pro rata,
dividends, when, if and as declared by the Board of Directors out of any
funds lawfully available therefor. In the event of a liquidation,
dissolution or winding up of the Company, the holders of Common Stock are
entitled to participate ratably in the distribution of assets remaining
after payment of liabilities. The issued and outstanding shares of Common
Stock are, and the Common Stock issued upon the exercise of Rights will be,
fully paid and nonassessable. See "Capitalization."

Holders of Common Stock are entitled to vote at all meetings of
stockholders of the Company for the election of directors and for other
purposes. Holders have one vote for each share of Common Stock held. The
Common Stock does not have cumulative voting rights. Therefore, holders of
more than 50% of the shares voting can elect all directors.

14
<PAGE>
<PAGE>

Warrants

On January 31, 1994 and in settlement of certain litigation, the
Company entered into warrant agreements (the "Warrant Agreements") covering
400,000 Shares of Common Stock pursuant to which the Company issued Warrants
to purchase shares of Common Stock (the "Warrant Shares"), representing
approximately a ___% equity interest in the Company on a fully-diluted
basis, at a price of $4 per share (the "Warrant Price"). The Warrants may
be exercised at any time before their expiration on January 31, 1999. The
number of Warrant Shares is subject to adjustment upon the occurrence of
certain events, including stock split and stock dividends, but not in the
case of the issuance of Common Stock to be sold pursuant to the exercise of
Rights.

Certain Provisions of the Restated Certificate of
Incorporation and the New York Corporate Law

Certain provisions of the Restated Certificate of Incorporation and
New York law may delay, deter or prevent a stockholder or group of
stockholders from taking corporate action or gaining control of the Company.
For example, Article Thirteen of the Company's Restated Certificate of
Incorporation imposes certain voting and other requirements on certain
mergers and other combinations with certain affiliated parties of the
Company. Section 912 of the New York Corporation Law imposes essentially
the same limitations on such transactions.

CERTAIN FEDERAL INCOME TAX CONSEQUENCES

The following discussion is based upon current provisions of the Code
applicable Treasury Regulations, judicial authority and administrative
rulings and practice. Legislative, judicial or administrative changes and
interpretations may be forthcoming that could alter or modify the statements
and conclusions set forth herein. Any such changes or interpretations may
or may not be retroactive and could affect the tax consequences to holders
of Rights or Underlying Shares.

Tax Consequences to Company

The Company currently has net operating loss carryforwards for Federal
income tax purposes of approximately $7 million. Acquisitions of Common
Stock by persons who are not currently holders of Common Stock, or by
persons whose acquisition would increase or maintain their equity ownership
in the Company above five percent, could result in an "ownership change"
within the meaning of section 382 of the Code, thereby imposing a
Section 382 Limitation on the Company's ability to utilize the net operating
loss carryforward to reduce future taxable income.

In general, an ownership change occurs for purposes of section 382 if
the percentage of stock ownership of any one or more "5 percent
shareholder(s)" (as determined under Federal income tax regulations)
increases in the aggregate by more than 50 percentage points during a
running three-year period. For this purpose, the term "5 percent
shareholder" includes certain public groups of shareholders of the Company
who may own, directly or indirectly, less than five percent of the Company's
stock.

If the Company believes that the issuance of Underlying Shares
pursuant to the Subscription Privilege will cause an ownership change, then
the Company will have the right to reduce the number of Underlying Shares
issuable to all holders exercising the Subscription Privilege, pro rata, or
to any individual holder or holders whose exercise of the Subscription
Privilege may cause an ownership change, to the extent necessary in the sole
discretion of the Company to prevent such ownership change. Notwithstanding
the foregoing, the Rights Offering increases the likelihood that an
ownership change will occur in the future, and it is impossible for the
Company to ensure that such ownership change will not occur, in part because
the Company has no ability to restrict the acquisition or disposition of
Common Stock by persons whose ownership could cause an ownership change. In
addition, the Company may in the future take certain actions which could
give rise to an ownership change, if in the exercise of the business
judgment of the Company such actions are necessary or appropriate. If an
"ownership change" were to occur subsequent to the

15
<PAGE>
<PAGE>

Rights Offering, the Section 382 Limitation could have a material adverse
impact upon the Company's earnings and upon the Company's cash flow. See
"Risk Factors--Continuation of Net Operating Loss Carryforwards."

Tax Consequences to Holders

Neither distribution nor exercise of the Rights will be a taxable
event for Federal income tax purposes to U.S. individual citizens or
residents or to U.S. corporations.

Except as provided below, a holder of Rights must allocate the tax
basis of the Common Stock between the Common Stock and the Rights in
proportion to the fair market value of each on the date of the distribution
of the Rights where the value of the Rights on the date of the distribution
is equal to or greater than 15% of the fair market value of the Common Stock
owned by such holder on the date of the distribution. Where the value of
the Rights is less than 15% of the value of such Common Stock at the time of
distribution, the holder will be treated as having no basis in the Rights
unless a special election is made to allocate the basis in the manner
described above. In any event, no portion of the basis of a holder's Common
Stock will be allocated to the Rights in accordance with these allocation
rules unless such Rights are exercised.

If a Holder exercises Rights pursuant to this offering, the tax basis
of the Underlying Shares will be equal to the Exercise Price plus any tax
basis the holder has in the Rights.

If a holder allows the Rights to lapse without exercise or sale, such
holder will realize no gain or loss since no basis will be allocated to the
Rights, and such holder's basis in the Common Stock will remain the same as
such basis was prior to the distribution of the Rights.

THE FOREGOING SUMMARY DOES NOT DISCUSS ALL ASPECTS OF FEDERAL INCOME
TAXATION THAT MAY BE RELEVANT TO A PARTICULAR PROSPECTIVE HOLDER OF RIGHTS
OR UNDERLYING SHARES. EACH PROSPECTIVE HOLDER OF RIGHTS OR UNDERLYING
SHARES SHOULD CONSULT HIS OWN TAX ADVISOR AS TO THE PARTICULAR TAX
CONSEQUENCES TO HIM OF RECEIVING, ACQUIRING, HOLDING, EXERCISING, CONVERTING
AND DISPOSING OF THE RIGHTS, OR UNDERLYING SHARES, INCLUDING THE
APPLICABILITY AND EFFECT OF STATE, LOCAL AND FOREIGN TAX LAWS.

PLAN OF DISTRIBUTION

The Company has not employed any brokers, dealers or underwriters in
connection with the solicitation of exercise of Rights, and no commissions,
fees or discounts will be paid in connection with the Rights Offering.
Certain employees of the Company may solicit responses from holders, but
such employees will not receive any commissions or compensation for such
services other than their normal employment compensation.

DIRECTORS, EXECUTIVE OFFICERS AND PRINCIPAL STOCKHOLDERS

See the Company's Annual Report to Shareholders and the Notice and
Proxy Statement attached hereto for information on these topics.

EXECUTIVE COMPENSATION

See the Company's Notice and Proxy Statement for its 1997 Annual
Meeting of Stockholders attached hereto.

16
<PAGE>
<PAGE>

SECURITIES OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT

See the Company's Annual Report to Shareholders and the Notice and
Proxy Statement attached hereto for information on these topics.

CERTAIN TRANSACTIONS

See the Company's Notice and Proxy Statement for its 1997 Annual
Meeting of Stockholders attached hereto for information on this topic.

LEGAL MATTERS

The validity of the Common Stock will be passed upon for the Company
by Vedder, Price, Kaufman & Kammholz, Chicago, Illinois.

EXPERTS

The consolidated balance sheets of the Company as of January 31, 1997
and 1996 and the related consolidated statements of operations,
stockholders' equity and cash flows for the years ended January 31, 1997 and
1996 incorporated in this prospectus by the attached 1997 Annual Report to
Shareholders of the Company have been incorporated herein in reliance on the
report of Lazar, Levine & Company LLP, independent public accountants, given
on the authority of that firm as experts in accounting and auditing.

17
<PAGE>
<PAGE>

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

No person has been authorized
to give any information or to make
any representations other than those
contained in this Prospectus in
connection with the Offering
described herein, and, if given or
made, such information or
representations must not be relied
upon as having been authorized by
the Company. This Prospectus does
not constitute an offer to sell or
a solicitation of an offer to buy
any securities other than those
specifically offered hereby or of
any securities offered hereby in
any jurisdiction to any person to
whom it is unlawful to make an
offer or solicitation in such
jurisdiction. Neither the delivery
of this prospectus nor any sale made
hereunder shall, under any
circumstances, create an implication
that the information herein is correct
as of any time subsequent to its date.

___________________ EAC INDUSTRIES

TABLE OF CONTENTS 2,283,551 SHARES OF
COMMON STOCK ISSUABLE
Page UPON EXERCISE OF RIGHTS TO
---- SUBSCRIBE FOR SUCH SHARES
Available Information. . . . . . . 2 ____________
Incorporation of Certain . . . . .
Documents by Reference . . . . . 2 PROSPECTUS
Prospectus Summary . . . . . . . . 3 ____________
The Company. . . . . . . . . . . . 3
The Recapitalization of the. . . . AUGUST __, 1997
Company. . . . . . . . . . . . . 3
Recent Events. . . . . . . . . . . 3
The Rights Offering. . . . . . . . 3
Summary Selected Financial
Data . . . . . . . . . . . . . . 5
Risk Factors . . . . . . . . . . . 6
The Company. . . . . . . . . . . . 8
The Reclassification Proposal. . . 8
Recent Events. . . . . . . . . . . 8
Price Range of Common Stock
and Dividends. . . . . . . . . . 8
Capitalization . . . . . . . . . . 9
Use of Proceeds. . . . . . . . . . 9
Dilution . . . . . . . . . . . . . 10
Selected Historical Financial
Data . . . . . . . . . . . . . . 11
The Rights Offering. . . . . . . . 12
Description of Capital Stock . . . 14
Certain Federal Income Tax
Consequences . . . . . . . . . . 15
Plan of Distribution . . . . . . . 16
Directors, Executive Officers
and Principal Stockholders . . . 16
Executive Compensation . . . . . . 16
Securities Ownership of Certain
Beneficial Owners and
Management . . . . . . . . . . . 17
Certain Transactions . . . . . . . 17
Legal Matters. . . . . . . . . . . 17
Experts. . . . . . . . . . . . . . 17

==================================== ===================================
<PAGE>
<PAGE>

APPENDIX A

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

ANNUAL REPORT

SHAREHOLDERS

EAC INDUSTRIES, INC.

FOR

THE FISCAL YEAR ENDED

JANUARY 31, 1997

===========================================================================
<PAGE>
<PAGE>

[LETTER OF PETER FRITZSCHE TO THE STOCKHOLDERS]

[TO COME]
<PAGE>
<PAGE>

BUSINESS
--------

The Registrant (also referred to as "EAC" or "the Company") was organized in
1958 as a New York corporation. The common stock of the Company is
currently traded on the over-the-counter market and the principal market
makers are Bishop Rosen & Company and Troster, Singer Corporation.

The Company has three operating subsidiaries, Goodren Products Corporation
("Goodren"), Athena Packaging, Inc. ("Athena") and Flexible Printed
Products, Inc. ("Flexible"). Goodren designs and provides point-of-purchase
advertising displays and wall decorations on semi-durable plastic.
Goodren's major market is consumer product manufacturers and one marketer of
children's wall decorations. Goodren's sales were backlogged at
approximately $218,000 and $191,000 at January 31, 1997 and 1996
respectively.

The business and all of the outstanding common shares of Athena were
acquired on September 27, 1996. Athena produces printed, laminated,
embossed and hot stamped labels, wraps, seals and decals for the cosmetics,
pharmaceutical and health and beauty aids industries. Athena's production
equipment and administrative operations were moved to Goodren's facility in
Englewood, New Jersey in January 1997. Athena's sales were backlogged at
approximately $65,000, at January 31, 1997. Athena believes that it can
fulfil the 1997 backlog on a timely basis.

Goodren and Athena both face strong competition in their respective
businesses, based mainly on quality, service and price. Goodren and Athena
combined, employ 30 persons of whom 12 are represented by unions.

The business and certain of the assets of Flexible were acquired on December
11, 1994. Flexible produces and prints on plastic, pre-cure in-mold heat
transfer labels for the identification and decoration of rubber and silicone
hoses, belts and tire patches. Flexible's sales were backlogged at
approximately $80,000 at January 31, 1997 and $75,000 at January 31, 1996.
Flexible believes that it can fulfill its 1997 backlog on a timely basis.

Flexible also faces strong competition in its business and its competition
has been mainly on the basis of quality, service and price. Flexible
employs 14 persons, none of whom are represented by unions.

Financial Condition of the Company
- ----------------------------------

The following is a discussion concerning the Company, Goodren, Athena and
Flexible.

The Company's financial condition has declined from January 31, 1996. The
primary reasons for this decline were: (a) the operating loss of the Company
for the 1997 fiscal year, (b) the costs of acquiring, moving and integrating
Athena's operations and (c) the purchase of additional capital equipment for
Flexible. The combination of the above factors has resulted in the
Company's average secured debt obligations being higher in 1997 as compared
to 1996. The Company's secured debt obligations were $175,000 at January
31, 1997 as compared to zero at January 31, 1996. The Company's current
assets decreased to $1,611,936 in 1997 from $2,029,001 in 1996, while its
total current liabilities increased to $1,055,524 as of January 31, 1997
from $934,716 as of January 31, 1996. Working capital decreased to $556,412
as of January 31, 1997 from $1,094,285 on January 31, 1996.

The Company's and Goodren's credit line and Note Agreement with Chemical
Bank of New Jersey, N.A., which was originally entered into on September 29,
1994, expired on January 12, 1997. The Company is currently negotiating a
new borrowing facility.

Point-of-Purchase Advertising
- -----------------------------

Goodren designs and produces point-of-purchase advertising and sales aids
such as signs, posters, decals and product identifiers. These products are
used in retail stores on shelves, price channels and display cases. Other
products include wall decorations. Goodren's products are produced on semi-
durable plastic through processes known as flexographic, lithographic and
silk screen printing.

Goodren's products are sold nationwide to manufacturers of consumer products
by both an in-house sales force as well as regional, independent
manufacturers' representatives. Goodren is a service business which
competes on the basis of its ability to produce high quality printing on
very short notice. The following table summarizes the percentage of sales
attributable to major classes of products:

<TABLE>
<CAPTION>
For the Fiscal Years
ended January 31,
--------------------

1997 1996
---- ----

Point-of-Purchase 45% 41%
Wall coverings 55% 59%
--- ---

100% 100%
--- ---
</TABLE>

Management estimates that Goodren has a 5% share in its portion of the
printed on plastic point-of-purchase ("P.O.P.") advertising industry.
Overall, the P.O.P. industry is a $16 billion business with over 200
manufacturing companies involved. Products for the entire industry range
from a wide variety of counter displays and large end-of-aisle displays to
small printed products produced by Goodren. The total printed-on-plastic
portion of the industry in which Goodren competes, represents approximately
$40 million. The Company estimates that approximately ten companies compete
directly with Goodren.

Pressure Sensitive Labels, Wraps, Seals and Decals
- --------------------------------------------------

Athena produces and markets primarily pressure sensitive labels for the
premium cosmetics, pharmaceutical, health and beauty aids industries. Other
products include non-pressure sensitive labels, soap wraps, decals and
seals. Athena's products are sold primarily in the Northeast by
manufacturer's representatives as well as in-house sales personnel.

In-Mold Heat Transfer Labels
- ----------------------------

Flexible produces and markets in-mold, pre-cure heat transfer labels to the
rubber and silicone industry primarily for identification and decoration of
hoses and belts. Other products include post cure heat transfer labels for
rubber patches, tires and other rubber and silicone products.

Flexible's products are sold nationwide primarily to rubber and silicone
hose and belt manufacturers, principally by its in-house sales personnel.
The remainder is sold by a limited number of manufacturers' representatives.

Management believes that the total in-mold decal/label market for decorating
rubber hoses and belts is approximately $8 million with Flexible's share
estimated at approximately 18%. The Company estimates that approximately
five companies compete directly with Flexible, including the parent company
of one of its customers. Flexible is a service business which competes on
the basis of its ability to produce and deliver high quality printing on
short notice.

PROPERTIES
----------

The following table shows the location of each plant or facility of the
Company and its subsidiaries and sets forth related information. The
properties listed below are believed adequate to serve the Company's needs
for the foreseeable future.

2
<PAGE>
<PAGE>

Approx. Lease
Area Expiration Annual
(Sq.Ft.) Date Rental Principal Use
------- ---------- ------ --------------------------------

101 W. Forest Avenue 20,000 6/2000 $57,000 Manufacturing and general
Englewood, New Jersey offices for Goodren and Athena

15237 Proctor Avenue 12,000 Month to $60,000 Manufacturing and general
City of Industry, California Month office for Flexible

2923 South Pullman 500 Month to $6,000 Sales office for Flexible
Santa Ana, California Month

22 Blackstone Avenue 500 Month to $4,800 Office space and headquarters
Branford, Connecticut Month for the Company

</TABLE>

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

Goodren is included in a threatened claim concerning environmental cleanup
costs. Goodren is included among a large number of companies involved, and
is not one of the major parties. Goodren previously settled the Federal
claims related to such cleanup costs and is in the process of settling the
State of New Jersey claims related thereto. The amount, if any, that
Goodren may ultimately have to pay, is subject to change and is uncertain at
this time. It is management's opinion that the Company is adequately
reserved for this matter and the ultimate resolution of this case should not
have a material impact on the financial condition of the Company.

For additional information regarding contingencies and/or litigation see
Note 12c of notes to consolidated financial statements.

MARKET FOR COMPANY'S COMMON
STOCK AND RELATED STOCKHOLDER MATTERS
-------------------------------------

The Company's common stock is traded on the over-the-counter market. Bishop
Rosen & Company and Troster, Singer Corporation are the principal market
makers. As of April 15, 1997, the Company believes there were approximately
2,500 shareholders of record. The Company's line of credit agreement (which
is presently being re-negotiated) with Chemical Bank prohibits it from
paying dividends without the lender's consent. No dividends have been
declared or paid during the past two fiscal years. The following table sets
forth, by fiscal quarters, the closing bid prices of the Company's Common
Stock per share for 1996 and 1997:

1996 1997
------------------------ ------------------------

First Quarter 3/8 First Quarter 3/8
Second Quarter 7/16 Second Quarter 1/4
Third Quarter 5/8 Third Quarter 3/16
Fourth Quarter 5/8 Fourth Quarter 3/16

</TABLE>

The volume of trading is sporadic and infrequent and the prices quoted may
not be representative.

3
<PAGE>
<PAGE>

MANAGEMENT'S DISCUSSION AND ANALYSIS OF OPERATIONS
--------------------------------------------------

In fiscal 1997, the Company had a net loss of $161,270 ($.07 per share) as
compared to net income of $129,195 ($.06 per share) in fiscal 1996.

The loss for fiscal 1997 was due to lower operating income of Flexible and
Goodren, higher general and administrative costs of EAC, and the costs of
acquiring, moving and integrating Athena's operations.

On September 27, 1996, the Company acquired the business and all of the
outstanding shares of Athena Packaging, Inc., a manufacturer of labels,
wraps, seals, and decals for premium cosmetics, pharmaceutical and health
and beauty aids manufacturers. Athena's operations are included in the
consolidated operations of the Company from the date of acquisition.

Net Sales -- 1997 to 1996
- -------------------------

Goodren's sales for 1997 declined 31% from 1996, due to lower sales of both
the point of purchase and wall covering segments of its business.
Flexible's sales increased by 4% compared to last year.

Earnings From Consolidated Continuing Operations -- 1997 to 1996
- ----------------------------------------------------------------

The Company's decrease in operating income from $131,443 in 1996 to an
operating loss of $459,296 in 1997, was primarily attributable to a decline
in gross profit margins for both Goodren and Flexible, the costs of
acquiring and integrating Athena, and higher general and administrative
costs of EAC.

Goodren's gross profit margins decreased from 27% in 1996 to 25% in 1997.
Goodren's selling, general and administrative expenses decreased 32%,
representing 26% of sales in 1997 compared to 27% of sales in 1996.

Flexible's gross profit margins decreased from 37% in 1996 to 32% in 1997.
Flexible's selling, general and administrative expenses increased 12%,
representing 25% of sales in 1997 compared to 24% of sales in 1996.

Inflation
- ---------

The Company expects inflation to be moderate and to be offset by cost
reduction programs and price increases.

Interest and Other
- ------------------

The Company's interest expense increased in 1997 over 1996 as a result of
higher average borrowings for the year. However, the Company's outstanding
debt was $489,504 at January 31, 1997 compared to $642,706 at January 31,
1996.

Provision (Benefit) for Income Taxes
- ------------------------------------

The 1997 and 1996 federal income tax provisions are offset in their
entirety by net operating loss carryforwards from prior years. The Company
has a loss carryforward of approximately $7,000,000 at January 31, 1997
which is available to offset future operating earnings. These carryforward
losses will expire in years after 2005.

Financial Resources and Liquidity
- ---------------------------------

The Company's financial condition declined somewhat in 1997 from 1996. The
Company had working capital of $556,412 as of January 31, 1997 compared to
$1,094,285 as of January 31, 1996. The Company and its subsidiaries,
Goodren, Athena and Flexible are current on all of their accounts payable
and accrued expenses.

In March 1996, the Company entered into an agreement to make quarterly
payments of $7,548 against a union pension withdrawal liability/shortfall
(see Note 12d of Notes to the Consolidated Financial Statements).

4
<PAGE>
<PAGE>

Subsequently, on September 30, 1996, the Company and Goodren entered into a
Settlement Agreement with the Trustees of the union pension plan whereby
Goodren's pension fund liability was reduced from $560,000 to $360,000
payable in 80 equal quarterly payments of $8,752 including annual interest
at a rate of 8%. The Company has applied for a hardship case pursuant to
the Settlement Agreement, whereby the Company would reduce its quarterly
obligations to $3,000 until such time as the Company is out of hardship.

The Company believes that its cash on hand as well as the availability of a
new borrowing facility will be sufficient to fund planned operations for at
least the next 12 month period. The Company is anticipating capital
expenditures of approximately $200,000, during the next year, in order to
expand the operations of Goodren, Athena and Flexible. Management believes
that these expenditures can be funded from existing resources.

5
<PAGE>
<PAGE>

INDEPENDENT AUDITORS' REPORT
----------------------------

To the Board of Directors
EAC Industries, Inc.
Branford, Connecticut

We have audited the accompanying consolidated balance sheets of EAC
Industries, Inc. and subsidiaries as of January 31, 1997 and 1996 and the
related consolidated statements of operations, changes in shareholders'
equity and cash flows for the two year period ended January 31, 1997. 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 audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits 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 audits provide a
reasonable basis for our opinion.

In our opinion the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of EAC
Industries, Inc. and subsidiaries as of January 31, 1997 and 1996 and the
results of its operations and its cash flows for the years then ended in
conformity with generally accepted accounting principles.

/s/LAZAR, LEVINE & COMPANY LLP
------------------------------
LAZAR, LEVINE & COMPANY LLP

New York, New York
April 4, 1997

EAC INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
AS OF JANUARY 31, 1997 AND 1996
-------------------------------------

<TABLE>
<CAPTION>
- ASSETS (Note 6) -

1997 1996
---------- -----------
<S> <C> <C>
CURRENT ASSETS:
Cash (Notes 2d and 2h) $ 594,412 $ 628,380
Accounts receivable - net of allowance for doubtful
accounts of $45,566 and $45,980 for 1997 and 1996,
respectively (Note 2d) 666,379 996,132
Inventories (Notes 2e and 4) 300,238 302,840
Prepaid taxes and expenses 50,907 101,649
----------- ----------

TOTAL CURRENT ASSETS 1,611,936 2,029,001
----------- ----------

PROPERTY, PLANT AND EQUIPMENT, NET (Notes 2f, 5 and 8) 710,166 563,619
----------- ----------

OTHER ASSETS:
Costs in excess of net assets acquired (Notes 2g and 3) 453,601 367,967
Deferred taxes (Notes 2i and 9) 510,000 510,000
Other assets (Note 2h) 29,182 52,500
----------- ----------
992,783 930,467
----------- ----------
$3,314,885 $3,523,087
=========== ==========

- LIABILITIES AND SHAREHOLDERS' EQUITY -

CURRENT LIABILITIES:
Accounts payable $ 247,152 $ 246,897
Accrued expenses (Note 7) 579,441 571,960
Capital lease obligations - current portion (Note 8b) 34,589 -
Long-term liabilities - current portion (Note 8a) 14,181 34,232
Deferred income - 75,268
Acquisition note payable (Note 3) 175,000 -
Income taxes payable (Notes 2i and 9) 5,161 6,359
---------- ----------
TOTAL CURRENT LIABILITIES 1,055,524 934,716
---------- ----------
LONG-TERM DEBT - NET OF CURRENT PORTION (Note 8):
Capital lease obligations 81,377 -
Other liabilities 359,357 608,474
---------- ----------
440,734 608,474
---------- ----------
COMMITMENTS AND CONTINGENCIES (Notes 10, 11 and 12)
SHAREHOLDERS' EQUITY:
Common stock, $.10 par value; 20,000,000 shares authorized;
2,319,285 shares issued 231,929 231,929
Capital in excess of par value 10,504,380 10,504,380
Accumulated deficit (8,867,082) (8,705,812)
---------- ----------
1,869,227 2,030,497
Less: Common stock in treasury, 7,598 shares at cost (50,600) (50,600)
---------- ----------
1,818,627 1,979,897
---------- ----------
$ 3,314,885 $3,523,087
========== ==========
</TABLE>
The accompanying notes are an integral part of
these consolidated financial statements.

7
<PAGE>
<PAGE>

EAC INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
-------------------------------------

Year Ended January 31,
-----------------------
1997 1996
--------- ----------

NET SALES (Note 11) $5,988,315 $7,659,689

COSTS AND EXPENSES:
Cost of products sold 4,392,978 5,435,681
Selling, general and administrative expenses 2,054,633 2,092,565
---------- ----------
TOTAL COSTS AND EXPENSES 6,447,611 7,528,246
---------- ----------

OPERATING (LOSS) INCOME (459,296) 131,443
---------- ----------

OTHER INCOME (EXPENSE):
Interest expense (22,176) (14,295)
Gain on sale of fixed assets 242,000 -
Interest and other income 99,072 22,809
---------- ----------
318,896 8,514
---------- ----------
(LOSS) INCOME BEFORE PROVISION
FOR INCOME TAXES (140,400) 139,957

Income taxes, net of operating loss
carryforwards (Notes 2i and 9) 20,870 10,762
---------- ----------

NET (LOSS) INCOME $ (161,270) $ 129,195
========== ==========

(LOSS) INCOME PER SHARE (Note 2j) $ (.07) $ .06
========== ==========

</TABLE>
The accompanying notes are an integral part of
these consolidated financial statements.

8
<PAGE>
<PAGE>

EAC INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
---------------------------------------------------------

Capital in Common Total
Number of Common Excess Accumulated Stock in Stockholders'
Shares Stock of Par Deficit Treasury Equity
--------- ------ ----------- ----------- -------- -------------

Balance at January 31, 1995 2,319,285 $231,929 $10,504,380 ($8,835,007) ($50,600) $1,850,702

Net income for the year -- -- -- 129,195 -- 129,195
--------- -------- ----------- ---------- ------- ----------
Balance at January 31, 1996 2,319,285 231,929 10,504,380 (8,705,812) (50,600) 1,979,897

Net loss for the year -- -- -- (161,270) -- (161,270)
--------- -------- ----------- ---------- ------- ----------
BALANCE AT
JANUARY 31, 1997 2,319,285 $231,929 $10,504,380 ($8,867,082) ($50,600) $1,818,627
========= ======== =========== ========== ======= ==========
</TABLE>

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

9
<PAGE>
<PAGE>

EAC INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
-------------------------------------

Year Ended January 31,
-------------------------
1997 1996
----------- -----------

<S> <C> <C>
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS:

CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss) income $(161,270) $ 129,195
Adjustments to reconcile net (loss) income to cash (utilized)
by operating activities:
Depreciation and amortization 141,035 105,201
Allowance for doubtful accounts 75,000 30,000
Amortization of deferred rental income (75,268) (103,938)
Gain on sale of fixed assets (242,000) -
Changes in assets and liabilities:
Decrease (increase) in accounts and notes receivable 461,728 (209,509)
Decrease in inventories 105,166 215,480
Decrease (increase) in prepaid expenses 116,880 (35,622)
(Decrease) in accounts payable, accrued expenses and accrued
income taxes (442,961) (167,130)
(Decrease) in other, net - (25,000)
--------- ---------
Net cash (utilized) by operating activities (21,690) (61,323)
--------- ---------

CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sale of fixed assets 242,000 -
Capital expenditures (48,598) (144,102)
Investment in new subsidiary (175,000) -
--------- ---------
Net cash provided (used) by investing activities 18,402 (144,102)
--------- ---------

CASH FLOWS FROM FINANCING ACTIVITIES:
(Decrease) in short-term debt - (150,000)
Payments of capital lease obligations (25,870) -
Payments of long-term debt (4,810) (4,702)
--------- ---------
Net cash (used by) financing activities (30,680) (154,702)
--------- ---------

(DECREASE) IN CASH AND CASH EQUIVALENTS (33,968) (360,127)

Cash and cash equivalents, at beginning of year 628,380 988,507
--------- ---------

CASH AND CASH EQUIVALENTS, AT END OF YEAR $ 594,412 $ 628,380
========= =========

SUPPLEMENTAL CASH FLOW INFORMATION:
Interest paid $ 17,906 $ 14,295
Income taxes paid 6,260 50,070

</TABLE>
The accompanying notes are an integral part of
these consolidated financial statements.

10
<PAGE>
<PAGE>

EAC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 1997 AND 1996
------------------------------------------

NOTE 1 - DESCRIPTION OF THE COMPANY:

EAC Industries, Inc., the Company, was organized in 1958 as a New
York corporation. The Company is a holding company with three
wholly-owned operating subsidiaries, Goodren Products Corporation
("Goodren"), Flexible Printed Products, Inc. ("Flexible") and
Athena Packaging, Inc. ("Athena"), see Note 3. Goodren designs
and produces point-of-purchase advertising displays and wall
decorations on semi-durable plastic. Goodren's major market is
consumer product manufacturers and one marketer of children's wall
decorations. Flexible produces and prints on plastic, pre-cure
in-mold heat transfer labels for the identification and decoration
of rubber and silicone hoses, belts and tire patches. Athena
produces printed laminated, embossed and hot stamped labels,
wraps, seals and decals for the cosmetics, pharmaceutical and
health and beauty aids industries. Each of these subsidiaries
sells their products to customers throughout the United States.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

The Company's accounting policies are in accordance with generally
accepted accounting principles. Outlined below are those policies
considered particularly significant.

(a) Use of Estimates:

In preparing financial statements in accordance with generally
accepted accounting principles, management makes certain
estimates and assumptions, where applicable, that effect the
reported amounts of assets and liabilities and disclosures of
contingent assets and liabilities at the date of the financial
statements, as well as the reported amounts of revenues and
expenses during the reporting period. While actual results
could differ from those estimates, management does not expect
such variances, if any, to have a material effect on the
financial statements.

(b) Basis of Consolidation:

The consolidated financial statements include the accounts of
the Company and its operating subsidiaries. All material
intercompany balances and transactions have been eliminated in
consolidation.

Notes - Pg. 1
<PAGE>
<PAGE>

EAC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 1997 AND 1996
------------------------------------------

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued):

For purposes of the statements of cash flows, the Company
considers all investments purchased with a remaining maturity
of three months or less to be a cash equivalent.

(d) Concentration of Credit Risk:

Financial instruments that potentially subject the Company to
concentrations of credit risk consist principally of cash
investments and accounts receivable.

The Company and its subsidiaries maintain, at times, deposits,
in federally insured financial institutions, in excess of
federally insured limits. Management attempts to monitor the
soundness of these financial institutions and feels the
Company's risk is negligible.

Concentrations of credit risk with respect to accounts
receivable are limited due to the large customer base
maintained by the operating subsidiaries.

(e) Inventories:

Inventories are stated at the lower of cost or market,
determined on a first-in, first-out basis.

(f) Property, Plant and Equipment:

Fixed assets are reflected at cost. The Company principally
uses the straight-line method to compute depreciation of fixed
assets. Depreciation lives generally range from three to ten
years for furniture and fixtures, machinery and equipment and
transportation equipment. Buildings are being amortized over
20 years and leasehold improvements are amortized over the
useful life of the asset or the term of the lease, whichever
is shorter. Major renewals and betterments of fixed assets
are capitalized while maintenance and repairs are expensed as
incurred. Upon retirement of fixed assets, the related cost
and accumulated depreciation are written off and any gain or
loss is reflected in income.

Notes - Pg. 2
<PAGE>
<PAGE>

EAC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 1997 AND 1996
------------------------------------------

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued):

(g) Goodwill:

Costs in excess of net assets acquired are considered goodwill
and are being amortized over periods ranging from 15 to 40
years on a straight line basis. Amortization costs were
$24,208 and $24,833 for the years ended January 31, 1997 and
1996, respectively. Accumulated amortization as of January
31, 1997 and 1996 aggregated $257,250 and $243,042,
respectively.

The Company periodically reviews the valuation and
amortization of goodwill to determine possible impairment by
comparing the carrying value to the undiscounted future cash
flows of the related assets in accordance with Statement of
Financial Accounting Standard No. 121 - Accounting for the
Impairment of Long-lived Assets and for Long-lived Assets to
be Disposed of.

(h) Restricted Cash:

Cash balances required to be maintained in a severance fund
($25,000) as per Goodren's contract with a labor union, is
considered as restricted cash, and is included in non-current
assets.

(i) Income Taxes (see also Note 9):

The Company adopted Statement of Financial Accounting
Standards No. 109, "Accounting for Income Taxes" ("SFAS No.
109") effective February 1, 1993. The standards of SFAS No.
109 require that the Company utilize an asset and liability
approach for financial accounting and reporting for income
taxes. The primary objectives of accounting for income taxes
under SFAS No. 109 are to (a) recognize the amount of tax
payable for the current year and (b) recognize the amount of
deferred tax liability or asset based on management's
assessment of the tax consequences of events that have been
reflected in the Company's financial statements or tax
returns.

(j) Income Per Share:

Net (loss) income per share has been computed based upon the
weighted average number of common and common equivalent shares
outstanding during each period presented.

Notes - Pg. 3
<PAGE>
<PAGE>

EAC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 1997 AND 1996
------------------------------------------

NOTE 3 - ACQUISITION:

On September 27, 1996, the Company purchased all of the
outstanding capital stock of Athena Packaging, Inc. ("Athena"),
for $350,000. The acquisition agreement required that 50% of the
purchase price be paid at closing and the balance paid on March 1,
1997. The acquisition was accounted for as a purchase,
accordingly, the acquired assets and liabilities assumed through
this purchase have been recorded at their estimated fair market
values at the date of acquisition. The cost of the acquisition
exceeded the fair market value of the assets acquired by $124,050,
which amount was assigned to goodwill and is being amortized on a
straight-line basis over 15 years (see Note 2g).

The Company's consolidated statements of operations include the
revenues and expenses of Athena beginning September 27, 1996, the
date of acquisition. The following pro forma results were
developed assuming the acquisition had occurred at the beginning
of the earliest period presented (February 1, 1995).

<TABLE>
<CAPTION>
Year Ended January 31,
-----------------------
1997 1996
---------- ----------
(Unaudited) (Unaudited)

Net sales $6,541,000 $8,512,000
Net (loss) earnings $(135,000) $127,000
(Loss) earnings per share $(.06) $.05

</TABLE>

NOTE 4 - INVENTORIES:

Inventories at January 31, 1997 and 1996 consisted of the
following:

<TABLE>
<CAPTION>
1997 1996
---------- ----------

Raw materials $234,768 $250,005
Work in process 60,470 48,435
Finished goods 5,000 4,400
-------- --------
$300,238 $302,840
======== ========
</TABLE>

Notes - Pg. 4
<PAGE>
<PAGE>

EAC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 1997 AND 1996
------------------------------------------

NOTE 5 - PROPERTY, PLANT AND EQUIPMENT:

Fixed assets and accumulated depreciation at January 31, 1997 and
1996 consisted of the following:

<TABLE>
<CAPTION>
1997 1996
---------- ----------

Building and improvements $ 343,874 $ 388,973
Machinery and equipment 1,093,170 1,100,347
Label artwork 150,000 150,000
Transportation equipment 22,275 47,812
Furniture and fixtures 65,977 45,528
---------- ----------
1,675,296 1,732,660
Less: accumulated depreciation and
amortization 1,002,630 1,206,541
---------- ----------
672,666 526,119
Add: Land 37,500 37,500
---------- ----------
$ 710,166 $ 563,619
========== ==========

</TABLE>

For the years ended January 31, 1997 and 1996, depreciation
expense aggregated $116,827 and $80,368, respectively.

NOTE 6 - SHORT-TERM DEBT:

The Company established a new loan facility, effective in January
1996 which offered a maximum line of credit of $750,000, provided
for advances of up to 80% of eligible accounts receivable and 50%
of finished goods inventory (for a maximum of $350,000) and was
collateralized by all of the assets of the Company and its
subsidiaries. This line of credit expired in January 1997.
Interest accrued at the annual rate of prime plus 2%. As of
January 31, 1997 and 1996 there were no outstanding borrowings
under this agreement. The Company is in the process of
negotiating a new credit facility with its bank.

Notes - Pg. 5
<PAGE>
<PAGE>

EAC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 1997 AND 1996
------------------------------------------

NOTE 7 - ACCRUED EXPENSES:

At January 31, 1997 and 1996 accrued expenses consisted of the
following:

<TABLE>
<CAPTION>
1997 1996
---------- ----------

Salaries and wages $ 47,649 $ 37,063
Employee benefits 282,558 375,041
Accrued interest payable - 52,000
Other 249,234 107,856
-------- --------
$579,441 $571,960
======== ========

</TABLE>

NOTE 8 - LONG-TERM DEBT:

(a) Other Liabilities:

At January 31, 1997 and 1996 long-term liabilities included
the following:

<TABLE>
<CAPTION>
1997 1996
---------- ----------

9% equipment note payable in monthly
installments of $427, inclusive of
interest, maturing in April 1998 $ 5,283 $ 10,092

Union pension withdrawal liability/
shortfall, presently payable in
quarterly installments of $8,752
(including interest at 8% per annum
(see Note 12d) 368,255 632,614
-------- --------
373,538 642,706
Less: current portion 14,181 34,232
-------- --------
$359,357 $608,474
======== ========

</TABLE>

Aggregate maturities of long-term liabilities for the next five
and in the aggregate are $14,181, $9,525, $10,194 $10,911, $11,678
and $317,049 thereafter.

Notes - Pg. 6
<PAGE>
<PAGE>

EAC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 1997 AND 1996
------------------------------------------

NOTE 8 - LONG-TERM DEBT (Continued):

(b) Capital Lease Obligations:

The Company and its subsidiaries are the lessees of machinery
and equipment under leases expiring at various dates through
July 2001. The assets and liabilities are recorded at the
lower of the present value of the minimum lease payments or
the fair market value of the assets. The assets are
depreciated over their estimated useful lives. Depreciation
of assets under capital leases included in depreciation
expense for the year ended January 31, 1997, aggregated
$4,440.

Minimum future lease payments under capital leases as of
January 31, 1997 and for each of the next five years are as
follows:

<TABLE>

<S> <C>

1998 $ 48,593
1999 40,978
2000 33,228
2001 17,448
2002 8,724
--------
Total minimum lease payments 148,971
Less: amount representing interest (33,005)
--------
$115,966
========
</TABLE>

NOTE 9 - INCOME TAXES:

The provision for income taxes consisted of the following for the
years ended January 31, 1997 and 1996:

<TABLE>
<CAPTION>
1997 1996
-------- -------

Current:
Federal (net of benefit of operating
loss carryforward) $ - $ -
State and local 20,870 10,762
20,870 10,762
------- -------
Deferred:
Federal - -
State and local - -
------- -------
- -
------- -------
Provision for Income Taxes $20,870 $10,762
======= =======
</TABLE>
Notes - Pg. 7
<PAGE>
<PAGE>

EAC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 1997 AND 1996
------------------------------------------

NOTE 9 - INCOME TAXES (Continued):

The components of the net deferred income tax asset, pursuant to
SFAS 109, as of January 31, 1997 and 1996 are as follows:

<TABLE>
<CAPTION>
1997 1996
-------- -------

Deferred tax assets:
Accounts receivable $ 5,400 $ 5,400
Inventory 1,800 1,800
Operating loss carryforward 2,040,000 2,040,000
---------- ----------

Total deferred tax asset 2,047,200 2,047,200

Valuation allowance 1,537,200 1,537,200
---------- ----------
Net Deferred Income Tax Asset $ 510,000 $ 510,000
========== ==========

</TABLE>

The Company has available operating loss carryforwards for federal
tax purposes of approximately $7,000,000. These losses expire in
various years beginning in 2005 and may result in deferred tax
assets. The Company has recognized this asset but has provided a
valuation allowance based on the portion of the asset considered
realizable over the next three years. This allowance will be
evaluated at the end of each year, considering both positive and
negative evidence concerning the realizability of the asset, and
will be increased or reduced accordingly.

Reconciliation of the statutory Federal income tax rate to the
Company's negative effective tax rate for the years ended January
31, 1997 and 1996 is not provided due to the utilization of net
operating losses and the recognition of the deferred tax asset
above.

NOTE 10 - RETIREMENT PLANS:

Goodren has a defined contribution profit sharing plan covering a
substantial portion of its employees. Contributions are based on
a percentage of each participant's compensation or a fixed annual
contribution for union employees based on a collective bargaining
agreement. The cost of the plan amounted to $35,000 and $44,000
in 1997 and 1996. See also Note 12d.

Notes - Pg. 8
<PAGE>
<PAGE>

EAC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 1997 AND 1996
------------------------------------------

NOTE 11 - ECONOMIC DEPENDENCY:

One of the Company's customers accounted for 39% of net sales for
each of the years ended January 31, 1997 and 1996.

NOTE 12 - COMMITMENTS AND CONTINGENCIES:

(a) Operating Leases:

The Company and its subsidiaries lease certain administrative
and manufacturing facilities and equipment under operating
leases expiring at various times through 2000. Other
locations are rented on a month to month basis. Rental and
lease expense aggregated approximately $146,512 and $147,000
for the years ended January 31, 1997 and 1996, respectively.

Future minimum rental commitments for existing operating
leases and in the aggregate are as follows:

<TABLE>

<S> <C>

Fiscal year ending January 31, 1998 - $ 70,699
1999 - 66,032
2000 - 66,032
2001 - 27,513
--------
$230,276
========
</TABLE>

(b) Employment Contracts:

The Company has an employment contract (the "Contract") with
the President of Goodren which expired on January 31, 1994 and
which is subject to automatic renewals for successive one year
terms. The contract specifies base compensation of $155,000
for the initial term and is subject to annual increases based
on changes in the consumer price index. The contract also
provides for additional compensation equal to 5% of the
operating income of Goodren provided such operating income
exceeds $650,000 for the fiscal year. In December 1994,
Goodren entered into a further agreement with this executive
whereby the proceeds of a newly purchased term life insurance
policy in the amount of $250,000 will be paid to the spouse
upon the death of this executive.

Notes - Pg. 9
<PAGE>
<PAGE>

EAC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 1997 AND 1996
------------------------------------------

NOTE 12 - COMMITMENTS AND CONTINGENCIES (Continued):

(b) Employment Contracts (continued):

Flexible has entered into an employment contract with its
President for a three year period ending December 15, 1997,
which is subject to renewals for successive one year terms.
The base compensation under this contract is $75,000 with
adjustments to be made annually based on changes in the
consumer price index. The contract also provides for
additional compensation based on annual sales revenue and/or
gross profit performance of Flexible. The contract also
encompasses non-compete provisions, availability of medical
benefits and the use of an automobile.

Goodren is included in a threatened claim concerning
environmental cleanup costs. Goodren is included among a
large number of companies involved, and is not one of the
major parties. The amount, if any, that Goodren may
ultimately have to pay, is not considered material, is subject
to change and is uncertain at this time. It is management's
opinion that the Company is adequately reserved for this
matter and the ultimate resolution of this case should not
have a material impact on the financial condition of the
Company.

(d) Other:

Goodren has withdrawn from participating in the District 65
Union Pension Plan (the "Plan"), see Note 10. The withdrawal
has resulted in the assessment of a withdrawal liability owed
to the Plan by Goodren. During the year ended January 31,
1995, the Company accrued a reserve for an estimated liability
of $560,000 which counsel to the Company believed would be
payable over a period of approximately 22 years beginning
approximately one year from the withdrawal date. In March of
1996, subsequent to the balance sheet, the Company signed an
agreement with the Plan whereby they will make quarterly
payments of $7,548. A September 30, 1996, the Company and
Goodren entered into a Settlement Agreement with the Trustees
of the union pension plan whereby Goodren's pension fund
liability was reduced to $360,000 payable in 80 equal
quarterly payments of $8,752 including annual interest at a
rate of 8%. The Company has applied for a hardship case
pursuant to the Settlement Agreement, whereby the Company
would reduce its quarterly obligations to $3,000 until such
time as the Company is out of hardship. Goodren is also
potentially liable to the Internal Revenue Service ("IRS") for
excise taxes of approximately $5,000 under paragraph 4971 of
the Internal Revenue Code.

Notes - Pg. 10
<PAGE>
<PAGE>

APPENDIX B

PRELIMINARY COPY

EAC INDUSTRIES, INC.
NOTICE OF 1997 ANNUAL MEETING OF SHAREHOLDERS

September 30, 1997

NOTICE IS HEREBY GIVEN that the 1997 Annual Meeting of Shareholders of
EAC INDUSTRIES, INC., a New York corporation (the "Company"), will be held
at The Yale Club, 50 Vanderbilt Avenue, New York, New York 10017, on
Tuesday, September 30, 1997 at 8:30 a.m., local time, for the following
purposes:

1. To elect four (4) Directors.

2. To amend the Company's Restated Certificate of Incorporation to
effect a 1 for 100 share reverse stock split of the Common Stock
and to pay cash in lieu of fractional shares and to immediately
thereafter to reclassify such resulting whole shares on a 100
for 1 basis.

3. To transact such other business as may properly come before said
Annual Meeting and any and all adjournments thereof.

By Order of the Board of Directors

PETER B. FRITZSCHE

Chairman of the Board and CEO

August 22, 1997<PAGE>
<PAGE>

EAC INDUSTRIES, INC.
22 Blackstone Avenue
Branford, CT 06405

PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS

This Proxy Statement, which is being mailed to shareholders on or
about August 22, 1997, is furnished in connection with the solicitation of
proxies by the Board of Directors of EAC Industries, Inc., a New York
corporation ("EAC" or the "Company"), to be used at the 1997 Annual Meeting
of Shareholders of the Company to be held at the time and place and for the
purposes specified in the foregoing Notice.

You are requested to complete, date and sign the accompanying proxy
and return it promptly to the Company in the enclosed envelope. Proxies duly
executed and received in time for the meeting will be voted at the meeting
in accordance with the instructions thereof. Such proxies may,
nevertheless, be revoked at any time prior to the voting thereof.

The Board of Directors has fixed the close of business on August 20,
1997 as the record date for the determination of shareholders who are
entitled to notice of, and to vote at, the meeting or any adjournments
thereof. The transfer books of the Company will not be closed. As of August
20, 1997 there were 2,311,687 shares of common stock outstanding, the
holders of which are entitled to one vote per share on all matters presented
at the meeting. Directors are elected by a plurality of votes cast. Under
the law of New York, EAC's state of incorporation, "votes cast" at a meeting
of stockholders by the holders of shares entitled to vote are determinative
of the outcome of the matter subject to vote. Abstentions, broker non-votes,
and withheld votes will not be considered "votes cast" based on EAC's
understanding of state law requirements. To the best knowledge of the
Company, there is one shareholder owning more than 5% of the Company's
Common Stock. See "Principal Holders of Securities."
<PAGE>
<PAGE>

PROPOSAL NO. 1
--------------

ELECTION OF DIRECTORS

Proxies in the accompanying form, which are properly executed, marked,
duly returned and not revoked, will be voted as directed. Unless otherwise
indicated, such proxies will be voted in favor of the election of the four
nominees for directors of EAC whose names appear below. If any of the
nominees for directors becomes unavailable to serve prior to the meeting
date, an event which the Board of Directors does not presently anticipate,
the proxies will be voted for substitute nominees who will be persons
designated by the Board of Directors of EAC. Directors of EAC are to be
elected at its Annual Meeting to hold office until the next Annual Meeting
of Shareholders and until the election of their respective successors.

The following table sets forth the names of the nominees for the
election to the Board of Directors, their business experience during the
past five years, their positions, if any, with EAC, their previous terms as
directors and the number of shares of Common Stock of EAC owned beneficially
by each of them as of August 20, 1997. Each nominee's Common Stock
ownership represents less than 1% of the aggregate amount of Common Stock
outstanding, except for Peter B. Fritzsche whose beneficial ownership
represents approximately 20% of the outstanding Common Stock of the Company.

<TABLE>
<CAPTION>
Common Stock
Owned
Beneficially
Principal Director As of
Name Occupation Since 8/20/97
- ---------------------------------------------------------------------------------
<S> <C> <C> <C>
Peter B. Fritzsche(1) Chairman of the Board of 1991 471,604(2)
Directors President and CEO and
Age 62 and Assistant Secretary, from
EAC - July 1992 to present; 1978-1990
Chairman of the Board of
Directors and Assistant
Secretary, EAC - December
1991 to July 1992;
Yale University Development
Office, New Haven, CT - January
1992 to July 1994; consultant -
1990 to 1991; Director of EAC -
1989 to 1990; Chairman of the
Board Of Directors, President
and CEO, EAC - 1979 to 1989

E. Donald McKenzie, Jr. President and CEO, The 1944 500
Mailhouse, Inc. - January, 1997
Age 43 to present; Vice President -
Sales and Marketing, Health Tour,
Inc. - January 1996 to January
1997; President Graphic Systems
West, Irvine, CA - 1991 to 1995;
President, Collin Printing
Systems, North Andover, MA - 1987
to 1991.

John B. Millet, Jr. President and Owner of Mohawk 1994 23,275
Metal Products Co., Utica, NY
Age 56 - since 1977.

P. Bartley Fritzsche(1) Regional Account Manager- 1994 19,000
Institutional Services,
Age 28 Neuberger & Berman Management
Inc., Chicago, IL - May 1997;
John Marshall Law School 1993
to 1997(J.D.); Account
Representative, John Nuveen
& Co., Chicago, IL - 1991 to
1993; Wittenberg University,
Springfield, OH (B.A. 1990)

</TABLE>

(1) Peter B. Fritzsche and P. Bartley Fritzsche are father and son.

(2) Includes 471,204 shares held directly or through an IRA and 400
shares held of record by Mr. Fritzsche's spouse, whose beneficial
ownership may be attributable to Mr. Fritzsche, but which he
disclaims.

2
<PAGE>
<PAGE>

Set forth below is the compensation paid to the executive officers of
the Company and its Goodren Products Corporation subsidiary and for all such
persons as a group;

Name and Principal All Other
Position Year Salary Bonus Compensation(1)
- ------------------ ---- ------ ----- ---------------

Peter B. Fritzsche FY1997 $132,000 $ -0- $ -0-

Chairman and CEO FY 1996 $132,000 $ -0- $ -0-

FY 1995 $117,000 $ -0- $ -0-

Steven Mann(2) FY 1997 $177,398 $ -0- $ -0-

President and CEO FY 1996 $179,970 $ 24,342 $ -0-

Goodren Products Corp. FY 1995 $179,314 $ 33,255 $ 9,576

</TABLE>

(1) Includes contributions by Goodren Products under its profit sharing
plan.

(2) Mr. Mann has an employment contract, renewable annually, which calls
for base compensation of $155,000 (subject to annual inflation
adjustments) and a bonus equal to 5% of Goodren's total operating
income, provided that operating income is in excess of $650,000 in the
pertinent fiscal year. Mr. Mann was not paid a discretionary bonus in
fiscal 1997.

Board members are paid fees equal to $4,000 per year, plus $1,250 for each
board or committee meeting attended.

3
<PAGE>
<PAGE>

Proposal No. 2
--------------

Proposal to Amend the Company's Restated Certificate of Incorporation
to Eliminate Odd-Lot Holders of Shares by Effecting a Reverse
Stock Split of the Common Stock and a Subsequent Forward
Stock Split of the Common Stock and by Paying Fractional Shares
at the Rate of $.28125 Per Share

Summary and Purpose of the Proposal

Summary. The Board of Directors has approved, and has directed that
the same be presented to shareholders for their approval, a proposal to
amend the Company's Restated Certificate of Incorporation (the
"Reclassification Amendment") to (a) effect a 100 to 1 reverse stock split
(the "Reverse Stock Split") of the Company's Common Stock, $.10 par value,
through a reclassification of the Common Stock pursuant to which each 100
shares of Common Stock outstanding as of the close of business on the
effective date of the amendment would be reclassified into one (1) new share
of Common Stock, $.10 par value, and (b) authorize an immediately subsequent
reclassification with a forward split of the new Common Stock (the "Forward
Stock Split") pursuant to which each holder of the reclassified Common Stock
at such moment would receive 99 additional shares (or a proportionately
appropriate smaller number for holding not divisible by 100) of reclassified
Common Stock for each one (1) share of reclassified Common Stock held as of
such moment. No fractional shares would be issued pursuant to the
reclassification and certain holders who would otherwise be entitled to
receive a fractional share in the Reverse Stock Split will receive cash in
lieu of their fractional share interests. If the holders hold less than 100
shares, their holdings are to be converted into the right to receive cash;
if their holdings are 100 shares or more, any fractional shares otherwise
due would be temporarily established on the books of the Company. The
Reverse Stock Split and the Forward Stock Split are herein referred to
collectively as the "Reclassification Proposal." The effect of the
Reclassification Proposal is that all holders of 100 shares of Common Stock
or more would have NO change in their holdings; holders of less than 100
shares ("odd-lot holders") would only be entitled to cash in lieu of
fractional shares. Following the annual meeting, the Company will offer the
right to purchase one (1) additional share of Common Stock to each
stockholder of record of the company as of October 1, 1997 (the "Rights
Offering"). If the Reclassification Proposal is approved, odd-lot holders
will have their stock ownership in the Company extinguished and they will
NOT receive rights in the Rights Offering.

The text of the proposed amendment to the Company's Restated
Certificate of Incorporation and the resolutions relating to the
Reclassification Proposal to be adopted by shareholders are set forth in
Exhibit A to this Proxy Statement and are hereby incorporated herein by
reference.

Purpose of the Proposed Reverse Stock Split and Forward Stock Split.
As of the Record Date for the Annual Meeting, the Company estimates that
approximately 994 recordholders and 86 beneficial holders, or approximately
44% of the record/beneficial holders of Common Stock, owned fewer than 100
shares of Common Stock. Of these 1,080 holders, the Company estimates that
approximately 350 held nine or fewer shares of Common Stock as of the Record
Date. The small holdings of such shareholders with fewer than 100 shares,
however, represented, in the aggregate, less than 1.3% of the Company's
outstanding Common Stock. The cost of administering each shareholder's
account and the amount of time spent by management in responding to
shareholder requests is the same regardless of the number of shares held in
the account. Accordingly, the cost to the Company of maintaining many small
accounts is disproportionately high when compared with the total number of
shares involved. In view of the disproportionate cost to the Company of
maintaining small shareholder accounts, management believes it would be
beneficial to the Company and its shareholders as a whole to eliminate the
administrative burden and cost associated with the many accounts containing
fewer than 100 shares (and in many cases, 10 shares) of the Company's Common
Stock. The Company anticipates that the Reclassification Proposal will
reduce the number of shareholders of the Company by 1,080, to approximately
1,200. It is anticipated that the cost of administering shareholder
accounts will be reduced by up to $6,500 per year as a result of the
Reclassification Proposal. The costs associated with such accounts in the
future are difficult to determine but the Company believes they could
greatly exceed the value of such shares. Based on the aggregate number of
shares owned by record holders with fewer than 100 shares, and the price to
be received in lieu of fractional shares of the Common Stock, the Company's
payments for fractional shares resulting from the Reverse Stock Split will
aggregate approximately $7,913. The Company intends to use its existing
cash, including a portion of the proceeds from the issuance of Common Stock
pursuant to the Rights Offering, for such purpose.

4
<PAGE>
<PAGE>

Based upon the last reported "bid" price of the Common Stock on the
over-the-counter on the Record Date of $__________, the market value of 99
shares of Common Stock was $_________. The Reclassification Proposal will
enable shareholders holding of record fewer than 100 shares to receive cash
in lieu of their shares and, in effect, avoid brokerage fees on the
transaction. Shareholders owning fewer than 100 shares of Common Stock
would, if they chose to sell their shares, incur large commission expenses
(generally at least $25) in relation to the market value of their shares.
Certain of such shareholders would, if they chose to sell their shares,
incur commission expenses greater than the market value of their shares. In
some cases, it might be difficult to find a broker to handle such small
transactions.

The Company is proposing the reclassification in lieu of a tender
offer for shares held by holders with fewer than 100 shares because of the
large number of shareholders with small holdings and as a means of reducing
the administrative and transactional cost that would be involved for the
Company to acquire such shares through a self tender offer or a Company
sponsored odd-lot shareholder program. The reclassification also permits
the Company to eliminate all odd-lot shareholdings, which would not be
possible through a self tender offer or an odd-lot shareholder program.
Although the proposed reclassification will eliminate the shareholdings of
all shareholders who hold fewer than 100 shares of record, the Company
believes that the reclassification is fair to such shareholders in that it
provides them with cash for their shares in an amount equal to or greater
than the market price thereof without the necessity of such shareholder
incurring brokerage fees therefor.

The 100 for 1 stock split immediately following the reclassification
(the Forward Stock Split) is intended to continue to permit the Company to
maintain a sufficient number of issued and outstanding shares of its Common
Stock so as not to adversely affect the availability of trading in the over-
the-counter market. The Reverse Stock Split will temporarily reduce the
number of issued and outstanding shares of the Common Stock to approximately
22,835. The Company estimates that the number of issued and outstanding
shares of Common Stock after giving effect to the Forward Stock Split will
be 2,283,551.

Shareholders should note that the Board of Directors cannot predict
what effect the proposed Reverse Stock Split and Forward Stock Split will
have on the market price of the Common Stock. With the number of
outstanding shares of Common Stock reduced by only 28,136, the effect may be
minimal.

Description and Effect of the Proposal

The Company's Restated Certificate of Incorporation currently
authorize the issuance of 20,000,000 shares of Common Stock, $.10 par value.
As of the Record Date for the Annual Meeting, the Company had outstanding
2,311,687 shares of Common Stock and 7,598 shares held in treasury. As of
the Record Date, there was also reserved for issuance upon the conversion or
exercise of various outstanding warrants or stock options of the Company
__________ shares of Common Stock, leaving a total of __________ authorized,
unissued and unreserved shares of Common Stock available for future
issuances.

Under the Recapitalization proposal, (i) one (1) new share of Common
Stock, $.10 par value, would be exchanged for every 100 shares of Common
Stock, $.10 par value, outstanding as of the close of business on the date
on which the amendment to the Company's Restated Certificate of
Incorporation is filed with the Secretary of State of the State of New York
(the "Effective Date") and (ii) each whole (or partial) share of the
reclassified Common Stock held by stockholders owning 100 shares or more
would immediately thereafter be again reclassified on a 100 for 1 basis so
that 99 additional shares of Common Stock would be issued with respect to
each whole share of previously reclassified Common Stock held with
proportionately fewer issued with respect to fractional shares. There would
be NO effect of the Reclassification proposal on holders of 100 or more
shares of Common Stock with respect to their holdings, in that there will be
no change in their stock ownership. Based upon information as of the Record
Date, it is anticipated that the number of outstanding shares of Common
Stock after giving effect to the Reclassification Proposal would be
approximately 2,283,551 shares.

No fractional shares of new Common Stock will be issued for any
fractional new share interest resulting from the Reverse Stock Split due to
holders of fewer than 100 shares. Rather, each such shareholder will
receive $.28125 per share, in lieu of such fractional share interest, which
is an amount of cash equal to .28125 multiplied by the number of shares of
Common stock held by such holder that would otherwise have been exchanged
for such fractional share interest. Based on the aggregate number of

5
<PAGE>
<PAGE>

shares owned by record and beneficial holders with fewer than 100 shares and
$.28125 price to be used to pay fractional share interests, the Company's
payments for fractional shares resulting from the Reverse Stock Split will
aggregate approximately $7,913.

If the Reclassification Proposal is approved, the Company will notify
the odd-lot holders of the filing of the Articles of Amendment with the
Secretary of State of the State of New York and will furnish such holders
with any additional information necessary to complete the enclosed letter of
transmittal for use in exchanging certificates. The odd-lot holders of the
Common Stock, promptly after the Reclassification Amendment becomes
effective, will be required to mail their certificates representing their
shares of Common Stock to the Company in order that the settlement of
fractional interests may be delivered promptly. As noted above, if the
Reclassification Proposal is approved, odd-lot holders will NOT receive
rights in the Rights Offering.

The proposed amendment to the Restated Certificate of Incorporation of
the Company provide that the cash issuable to certain shareholders of the
Company in connection with a reclassification of stock which are not claimed
by the shareholders entitled thereto within one (1) year after the cash
becomes payable, despite reasonable efforts by the Company to deliver the
cash within such time, will, at the expiration of such time, revert in full
ownership to the Company and the Company's obligation to pay such cash will
thereupon cease.

The Company estimates that the entire interest of approximately 1,080
odd-lot holders (those holding fewer than 100 shares) will be eliminated
pursuant to the Reclassification Amendment. Such shareholders will enjoy
the benefit of liquidating their relatively small holdings without paying
brokers' commissions. However, because such transaction would be mandatory,
such shareholders who wish to retain their existing equity interest in the
Company would be adversely affected. Fractional shares settled by the
Company are expected to aggregate approximately 23,136 shares, or
approximately 1.2 percent of those currently outstanding. Shares no longer
outstanding as a result of the fractional share settlement procedure will be
returned to authorized by unissued shares of the Company.

It is not anticipated that the Reclassification Proposal will affect
the registration of the Common Stock under the Securities Exchange Act of
1934 (the "Exchange Act").

After giving effect to the settlement of fractional shares of Common
Stock for odd-lot holders, there will be no differences between the shares
of Common Stock outstanding prior to the Reclassification Proposal and those
to be outstanding after the Reclassification Proposal is effected.

Shareholders of the Company will have no appraisal rights with respect
to the Reclassification Amendment under New York law or the Company's
Restated Certificate of Incorporation and no such rights will be afforded to
such shareholders by the Company.

In the Reclassification Proposal, cash proceeds received from the
settlement of fractional shares may result in (i) the realization by a
shareholder whose interest in the Company is completely terminated of
taxable gain or loss to the extent of the difference between such proceeds
and the cost or other basis applicable to the fractional shares and (ii)
dividend income to a shareholder whose interest in the Company is not
completely terminated. No officer, director, associate or affiliate of the
Company is expected to derive any material benefit in the Reclassification
Proposal other than the benefits that would be enjoyed by any other person
holding the same number of shares.

Vote Required and Recommendation for Approval

The Board of Directors Recommends a Vote FOR this Proposal. The
affirmative vote of the holders of at least 50% of the outstanding shares of
Common Stock as of the Record Date is necessary for the approval of the
Reclassification Amendment. The enclosed form of proxy provides a means for
shareholders to vote for the approval of this proposal, to vote against the
approval of this proposal or to abstain from voting with regard to the
approval of this proposal. Each properly executed proxy received in time
for the meeting will be voted as specified therein. IF A SHAREHOLDER
EXECUTES AND RETURNS A PROXY BUT DOES NOT SPECIFY OTHERWISE, THE SHARES
REPRESENTED BY SUCH SHAREHOLDER'S PROXY WILL BE VOTED "FOR" THE APPROVAL OF
THIS PROPOSAL.

6
<PAGE>
<PAGE>

1995 STOCK OPTION PLAN

The Company has a stock option plan (the"Plan"). As of August 20, 1997
there are unqualified options outstanding under the plan to purchase 15,000
shares of Common Stock of the Company, which unqualified options expire at
various dates through August, 2005 and are exercisable at prices between
$.1875 and $.4375 per share of Common Stock. 2,500 of such unqualified
options were granted pursuant to the Plan to each Non-Employee Director of
the Company on August 2, 1995 at $.4375 per share. During the fiscal year
ended January 31, 1997, unqualified options to acquire 2,500 shares were
granted to each Non-Employee Director of the Company, on August 13, 1996 at
$.1875 per share. During the fiscal year ended January 31, 1997, no options
were granted to key employees of the Company or its subsidiaries under the
Plan.

PROFIT SHARING PLANS

The Company maintains a deferred profit sharing plan ("Profit Sharing
Plan") which is intended to qualify under Section 401(a) of the Internal
Revenue Code of 1954, as amended ("Code"). The Profit Sharing Plan covers
full-time employees of the Company and its subsidiary, Goodren Products
Corporation, who have completed one (1) year of eligibility service and who
are not covered under any other tax qualified retirement plan. Employer
contributions to the Profit Sharing Plan are made at the discretion of the
Company's Board of Directors and are allocated among participating employees
based on their compensation. The Profit Sharing Plan benefits, subject to a
vesting schedule, become payable following a separation of service from the
Company.

The Profit Sharing Plan also provides for employees to defer a portion
of their eligible compensation, pursuant to Section 401(k) of the Internal
Revenue Code. There is no provision for matching contributions to be made
by the Company. No contributions were made to the Profit Sharing Plan by
the Company or Goodren for the fiscal years 1995, 1996 and 1997
respectively.

COMMITTEES OF THE BOARD OF DIRECTORS

The Board of Directors has established an Executive Committee,
Compensation and Audit Committee, in accordance with the by-laws and New
York law. The members of the Executive Committee are Messrs. Peter
Fritzsche and John Millet. The members of the Compensation and Audit
Committees are Messrs. Millet and McKenzie. Each Director attended all
meetings of the Board of Directors and Committees on which they served
during fiscal 1997.

PRINCIPAL HOLDERS OF SECURITIES

To the best knowledge of EAC, as of August 20, 1997, the only
beneficial owners of 5% or more of EAC's Common Stock is:

Amount
Principle Name and Address Beneficially Percent
Class of Beneficial Owner Owned of Class
- ----- -------------------------- ------------ --------

Common Stock Peter B. Fritzsche
22 Blackstone Avenue
Branford, CT 06405 471,204 20%

</TABLE>

INDEPENDENT AUDITORS

The Board of Directors reviews the selection of independent auditors
subsequent to the Annual Meeting of Shareholders. The firm of Lazar, Levine
& Company was EAC's independent auditor for the fiscal year ended January
31, 1997. A representative of Lazar, Levine & Company will be present at
the Annual Meeting, will be afforded an opportunity to make a statement, if
he or she so desires, and will be available to respond to appropriate
questions from shareholders.

7
<PAGE>
<PAGE>

OTHER MATTERS

The Board of Directors does not intend to bring any other matters
before the meeting and does not know of any other matters which are expected
to be brought before it. However, if any other matters do come before the
meeting, the persons named in the enclosed proxy will vote in accordance
with their proper judgement.

In addition to solicitation of proxies by mail, directors or
employees (who may be officers of the Company) may solicit proxies in person
and by telephone. The Company is requesting brokers and other custodians,
nominees and fiduciaries to forward proxy soliciting materials to the
beneficial owners of shares held of record by such persons. The cost of
soliciting proxies shall be borne by the Company, but any director or
employee of the Company who solicits proxies will not receive any additional
compensation therefore.

Shareholder proposals for the 1998 Annual Meeting of Shareholders of
EAC must be received by the office of EAC Industries, Inc., 22 Blackstone
Avenue, Branford, Connecticut 06405, no later than January 15, 1998 for
inclusion in the Proxy Statement for the 1998 Annual Meeting of
Shareholders.

By Order of the Board of Directors

PETER B. FRITZSCHE
Chairman of the Board and CEO

8<PAGE>
<PAGE>

EXHIBIT A

Text of Proposed Shareholder Resolutions
Approving the Reverse Stock Split and
the Forward Stock Split

RESOLVED, that the Board of Directors of the Corporation is hereby
authorized to cause to be filed Articles of Amendment to this Corporation's
Restated Certificate of Incorporation amending the first paragraph of the
Fourth Article of the Corporation's Restated Certificate of Incorporation in
its entirety to read as follows:

"FOURTH: The aggregate number of shares which the
Corporation shall have the authority to issue is 20,000,000
shares of Common Stock, par value $.10 per share. No
shareholder shall have any preemptive or other right to
subscribe for or purchase any additional shares of capital
stock of the Corporation or any securities convertible into
such shares or representing a right or option to purchase any
such shares."

RESOLVED, that the Board of Directors of the Corporation is hereby
authorized to implement the following procedures in connection with the two,
successive reclassifications of the Corporation's Common Stock, $.10 par
value ("Old Stock"), to Common Stock, $.10 par value ("New Stock"):

a. Immediately upon the amendment to the Corporation's
Restated Certificate of Incorporation authorizing the
reclassification becoming effective, every 100 shares of Old Stock
issued and outstanding, and each share held in the corporate
treasury, shall be converted into one (1) share of fully-paid and
non-assessable New Stock, subject to the required settlement of
fractional shares. The Corporation shall (i) issue one (1) share of
New Stock for every 100 shares of Old Stock outstanding and (ii) pay
cash in lieu of any fraction of a share of New Stock which any
shareholder who owns fewer than 100 shares would otherwise receive.
Fractional shares of New Stock due with respect to other holders
(including treasury stock) shall be temporarily established on the
books and records of the Corporation. The settlement amount for
those fractional shares of New Stock which are not issued but are
converted into the right to receive cash shall be equal to the
product obtained by multiplying (i) $.28125 per share for the Old
Stock by (ii) the number of shares of Old Stock that would otherwise
have been exchanged for such fractional share interest of New Stock.
Immediately after such reclassification and conversion has occurred
and right to payment for fractional shares with respect to certain
holders has been created, each then existing whole share (or
fraction thereof) of New Stock shall again be reclassified 100
shares for one (1), with the issuance of 99 additional shares for
each share of New Stock then existing (or such number properly
corresponding to the fractional shares of New Stock then temporarily
existing), so that the number of shares of New Stock, except for
shares as to which fractional share payment obligations for the Old
Stock have been created, shall be exactly equal to the number of
shares of Old Stock existing prior to such action. From and after
the time the amendment becomes effective, certificates representing
shares of Old Stock shall be deemed to represent shares of New
Stock, and cash in lieu of any fractional share of New Stock with
respect to certain holders, to which an individual shareholder would
otherwise be entitled.

b. No shareholder shall be required to deliver the
certificates representing their shares of the Old Stock outstanding
immediately prior to the time the reclassification amendment becomes
effective, which certificate shall continue to represent the New
Stock. The Corporation shall deliver a check for the amount
necessary to pay such shareholder for any fraction of a whole share
of New Stock converted into cash only upon submission by such holder
of the stock certificate representing such shares.

c. Any cash to be paid in lieu of fractional share
interests of New Stock to certain holders shall revert in full
ownership to the Corporation one year after the reclassification
amendment becomes effective if such cash is not claimed by the
persons entitled thereto.

A-1
<PAGE>
<PAGE>

RESOLVED, that the Board of Directors of the Corporation is hereby
authorized to adopt a resolution adjusting the capital accounts of the
Corporation as, in their judgment, shall be in the best interests of the
Corporation in light of the adoption of the foregoing resolutions; and

RESOLVED, that the Board of Directors of the Corporation is hereby
authorized and directed to adopt any or all changes to the By-laws of the
Corporation, and the officers of the Corporation are hereby authorized and
directed to do all other things and execute and file all documents,
including amendments to the Corporation's Restated Certificate of
Incorporation, which in their sole judgment are deemed to be necessary and
proper to carry out the intent of the foregoing resolutions.

A-2
<PAGE>
<PAGE>

APPENDIX C
----------

SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

FORM 10-QSB

QUARTERLY REPORT PURSUANT TO THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended April 30, 1997

EAC INDUSTRIES, INC.
<PAGE>
<PAGE>

ITEM I. FINANCIAL STATEMENTS:

EAC INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
-------------------------------------

- ASSETS -
<TABLE>
<CAPTION>
April 30, January 31,
1997 1997
--------- -----------
(unaudited)

<S> <C> <C>
CURRENT ASSETS:
Cash $ 443,451 $ 594,412
Notes and accounts receivable - net of allowance for doubtful
accounts of $45,566 at April 30, and January 31, 1997,
respectively 805,921 666,379
Inventories 367,520 300,238
Prepaid taxes and expenses 65,743 50,907
----------- -----------

TOTAL CURRENT ASSETS 1,682,635 1,611,936
----------- -----------

PROPERTY, PLANT AND EQUIPMENT, NET 682,146 710,166
----------- -----------

OTHER ASSETS:
Costs in excess of net assets acquired - net 445,669 453,601
Deferred income taxes 510,000 510,000
Other assets 29,182 29,182
----------- -----------
984,851 992,783
----------- -----------

$ 3,349,632 $ 3,314,885
=========== ===========

- LIABILITIES AND SHAREHOLDERS' EQUITY -

CURRENT LIABILITIES:
Accounts payable $ 367,714 $ 247,152
Accrued expenses 536,962 579,441
Long-term liabilities - current portion 90,342 223,770
Income taxes payable - 5,161
----------- -----------

TOTAL CURRENT LIABILITIES 995,018 1,055,524
----------- -----------

LONG-TERM LIABILITIES - NET OF CURRENT PORTION 518,040 440,734
----------- -----------

COMMITMENTS AND CONTINGENCIES (Note 3)

SHAREHOLDERS' EQUITY:
Common stock, $.10 par value; 20,000,000 shares authorized,
2,319,285 shares issued 231,929 231,929
Capital in excess of par value 10,504,380 10,504,380
Accumulated deficit (8,849,135) (8,867,082)
----------- -----------
1,887,174 1,869,227
Less: Common stock in treasury, 7,598 shares at cost (50,600) (50,600)
----------- -----------
1,836,574 1,818,627
----------- -----------
$ 3,349,632 $ 3,314,885
=========== ===========
</TABLE>
The accompanying notes are an integral part of
these consolidated statements.

C-2
<PAGE>
<PAGE>

EAC INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
-----------------------------------------------
(Unaudited)

<TABLE>
<CAPTION>
For The Three Months
Ended April 30,
--------------------
1997 1996
---- ----

NET SALES $1,742,656 $1,705,804
---------- ----------

COSTS AND EXPENSES:
Cost of products sold 1,240,253 1,194,225
Selling, general and administrative expenses 476,036 549,253
---------- ----------
TOTAL COSTS AND EXPENSES 1,716,289 1,743,478
---------- ----------

OPERATING INCOME (LOSS) 26,367 ( 37,674)
---------- ----------

OTHER INCOME (EXPENSES):
Interest expense (10,556) (143)
Interest and other income 2,136 22,485
---------- ----------
(8,420) 22,342
---------- ----------

INCOME (LOSS) BEFORE INCOME TAXES 17,947 (15,332)

Income taxes, net of operating loss carryforwards - -
---------- ----------

NET INCOME (LOSS) $ 17,947 $ (15,332)
========== ==========

INCOME (LOSS) PER SHARE (Note 2) $ .01 $ (.01)
========== ==========
</TABLE>

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

C-3
<PAGE>
<PAGE>

EAC INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
-----------------------------------------------
(Unaudited)

<TABLE>
<CAPTION>
For The Three Months
Ended April 30,
--------------------
1997 1996
---- ----

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS:

CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ 17,947 $ (15,332)
Adjustments to reconcile net income (loss) to cash provided
from operating activities:
Depreciation and amortization 40,502 43,686
Amortization of deferred rental income - (18,817)
Change in assets and liabilities:
(Increase) decrease in accounts and notes receivable (139,542) 45,780
(Increase) decrease in inventories (67,282) 71,167
(Increase) in prepaid expenses and other assets (10,292) (23,447)
Increase in accounts payable, accrued expenses and accrued
income taxes 167,224 46,090
--------- ---------
Net cash provided from operating activities 8,557 149,127
--------- ---------

CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures (4,550) (75,237)
--------- ---------
Net cash (used by) investing activities (4,550) ( 75,237)
--------- ---------

CASH FLOWS FROM FINANCING ACTIVITIES:
Net decrease in short-term debt (8,032) -
Payments of long-term debt (146,936) (8,258)
--------- ---------
Net cash (used by) financing activities (154,968) (8,258)
--------- ---------

NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS (150,961) 65,632

CASH AND CASH EQUIVALENTS, AT BEGINNING OF YEAR 594,412 628,380
--------- ---------

CASH AND CASH EQUIVALENTS, AT END OF PERIOD $443,451 $ 694,012
========= =========
</TABLE>

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

C-4
<PAGE>
<PAGE>

EAC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO INTERIM CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
------------------------------------------------------------
(Unaudited)

NOTE 1 - BASIS OF PRESENTATION:

In the opinion of management, the accompanying unaudited interim
consolidated condensed financial statements of EAC Industries,
Inc. (the "Company") and its subsidiaries, contain all adjustments
necessary (consisting of normal recurring accruals or adjustments
only) to present fairly the Company's financial position as of
April 30, 1997 and the results of its operations and cash flows
for the three month periods ended April 30, 1997 and 1996.

The accounting policies followed by the Company are set forth in
Note 2 to the Company's consolidated financial statements included
in its Annual Report on Form 10-KSB for the year ended January 31,
1997, which is incorporated herein by reference. Specific
reference is made to this report for a description of the
Company's securities and the notes to consolidated financial
statements.

The results of operations for the three month period ended
April 30, 1997 are not necessarily indicative of the results to be
expected for the full year.

NOTE 2 - EARNINGS (LOSS) PER SHARE:

Earnings (loss) per share has been computed on the basis of the
weighted average number of common shares and common equivalent
shares outstanding during each period presented.

In February 1997, the Financial Accounting Standards Board issued
SFAS No. 128 - Earnings Per Share, which pronouncement changes the
method for calculating earnings per share. SFAS 128 requires
presentation of "basic " and "diluted" earnings per share as
opposed to "primary" and "fully diluted" earnings per share, and
is effective for periods ending after December 15, 1997. Early
adoption is not permitted. Management does not believe that SFAS
128 will result in earnings per share that is materially different
from that currently reported.

NOTE 3 - CONTINGENCY:

Goodren has withdrawn from participating in the District 65 Union
Pension Plan (the "Plan"). This withdrawal resulted in the
assessment of a withdrawal liability owed to the Plan by Goodren.
During the year ended January 31, 1995, the Company accrued a
reserve for an estimated liability of $560,000 which counsel to
the Company believed would be payable over a period of
approximately 22 years beginning approximately one year from the
withdrawal date. In March of 1996, the Company signed an
agreement with the Plan whereby they will make quarterly payments
of $7,548. On September 30, 1996, the Company and Goodren entered
into a Settlement Agreement with the Trustees of the union pension
plan whereby Goodren's pension fund liability was reduced to
$360,000 payable in 80 equal quarterly payments of $8,752
including annual interest at a rate of 8%. The Company has
applied for a hardship case pursuant to the Settlement Agreement,
whereby the Company would reduce its quarterly obligations to
$3,000 until such time as the Company is out of hardship. Goodren
is also potentially liable to the Internal Revenue Service ("IRS")
for excise taxes of approximately $5,000 under paragraph 4971 of
the Internal Revenue Code.

C-5
<PAGE>
<PAGE>

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION:

Introduction:

EAC Industries, Inc., the Company, is a holding company with three
operating subsidiaries: Goodren Products Corporation ("Goodren"),
Athena Packaging, Inc. ("Athena") and Flexible Printed Products,
Inc. ("Flexible"). Goodren designs and provides point-of-purchase
advertising displays and wall decorations on semi-durable plastic.
Athena produces printed, laminated embossed and hot-stamped
labels, wraps, seals and decals for the cosmetics, pharmaceutical
and health and beauty aids industries. Flexible produces and
prints on plastic, pre-cure in-mold heat transfer labels for the
identification and decoration of rubber and silicone hoses, belts
and tire patches.

The financial information presented herein includes: (i)
Consolidated condensed balance sheets as of April 30, 1997 and
January 31, 1997; (ii) Consolidated condensed statements of
operations for the three month periods ended April 30, 1997 and
1996 and (iii) Consolidated condensed statements of cash flows
for the three month periods ended April 30, 1997 and 1996.

Results of Operations:

Sales for the three-month period ended April 30, 1997 were
$1,743,000 as compared to $1,706,000 for the comparable period of
the prior year, reflecting an increase of $37,000 or 2.2%.
Cost of sales as a percentage of sales remained relatively
consistent for the three-month period ended April 30, 1997 at
$1,240,000 (71% of sales) as compared to $1,194,000 (70% of sales)
for the comparable period of the prior year.

Selling, general and administrative expenses decreased from
$549,000 (32% of sales) for the three-month period ended April 30,
1996 to $476,000 (27% of sales) for the three-month period ended
April 30, 1997. The Company believes that this decrease is due to
the monitoring of costs more effectively.

For the three months ended April 30, 1996 the Company reflected a
net loss of $15,332. For the three months ended April 30, 1997
the Company reflected net income of $17,947. This increase in
earnings was primarily due to the increase in sales and reduced
operating overhead as mentioned above.

Liquidity and Capital Resources:

At April 30, 1997, the Company's working capital was $688,000
compared to working capital of $556,000 at its year ended
January 31, 1997. Cash amounted to $443,000 at April 30, 1997
compared to $594,000 at January 31, 1997.

The Company is anticipating capital expenditures of approximately
$200,000, during the next year, in order to expand the operations
of Goodren, Athena and Flexible. Management believes that these
expenditures can be funded from existing resources.

The Company believes that its cash flows from operations will be
sufficient to meet its financial requirements over the next twelve
months.

C-6
<PAGE>
<PAGE>

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
(continued):

Other:

This report contains forward-looking statements and information
that is based on management's beliefs and assumptions, as well as
information currently available to management. When used in this
document, the words "anticipate," "estimate," "expect," "intend"
and similar expressions are intended to identify forward-looking
statements. Although the Company believes that the expectations
reflected in such forward-looking statements are reasonable, it
can give no assurance that such expectations will prove to be
correct. Such statements are subject to certain risks,
uncertainties and assumptions. Should one or more of these risks
or uncertainties materialize, or should the underlying assumptions
prove incorrect, actual results may vary materially from those
anticipated, estimated or expected. Among the key factors that
may have a direct bearing on the Company's operating results are
fluctuations in the economy, the degree and nature of competition,
the risk of delay in product development and release dates and
acceptance of, and demand for, the Company's products.

C-7
<PAGE>
<PAGE>

PART II
INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 24. INDEMNIFICATION OF DIRECTORS AND OFFICERS

The Company's Restated Certificate of Incorporation and
Indemnification Agreements with its directors provide that the Company shall
indemnify and advance expenses to its currently acting and its former
directors, officers, employees or agents to the fullest extent permitted by
the New York Corporation Law (the "NYCL"), whenever they are defendants or
threatened to be made defendants in any legal or administrative proceeding
by reason of their relationship with the Company. Section 722 of the NYCL
provides that a corporation may indemnify any person who was or is a party
or is threatened to be made a party to any threatened, pending or completed
action, suit or proceedings whether civil, criminal, administrative or
investigative (other than an action by or in the right of the Company) by
reason of the fact that such person is or was a director, officer, employee
or agent of the Company or is or was serving at the request of the Company
as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, against expenses
(including attorney's fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by him in connection with such action, suit
or proceeding if such person acted in good faith and in a manner the person
reasonably believed to be in or not opposed to the best interests of the
Company, and, with respect to any criminal action or proceeding, had not
reasonable cause to believe was unlawful. A similar standard of care is
applicable in the case of derivative actions, except that indemnification
only extends to expenses (including attorneys' fees) incurred ln connection
with defense or settlement of such an action and then, where the person is
adjudged to be liable to the Company, only if and to the extent that any
court of proper jurisdiction or the court in which such action was brought
determines that such person is fairly and reasonably entitled to such
indemnity and then only for such amounts as the court shall deem proper.

[The Company maintains an insurance policy under which directors and
officers are insured, within the limits and subject to the limitations of
the policies, against expenses in connection with the defense of actions,
suits or proceedings, and certain liabilities that might be imposed as a
result of such actions, suits or proceedings, to which they are parties by
reason of being or having been directors or officers of the Company.?]

ITEM 25. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

Securities and Exchange Commission registration fee. . . . . . . $ 152

Fees and expenses of the Company as Exercise Agent,
including printing expenses. . . . . . . . . . . . . . . . .

Legal Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . $25,000

Accounting Fees and expenses . . . . . . . . . . . . . . . . . .

Miscellaneous. . . . . . . . . . . . . . . . . . . . . . . . . .

Total. . . . . . . . . . . . . . . . . . . . . . . . . . . . $40,000
=======
_______________
* Estimated

II-1
<PAGE>
<PAGE>

ITEM 26. RECENT SALES OF UNREGISTERED SECURITIES

Not applicable.

ITEM 27. EXHIBITS

EXHIBIT
NUMBER DESCRIPTION
- ------- -----------

3.1 Restated Certificate of Incorporation of the Company. (1)

3.2 Amended Bylaws of the Company. (2)

4.1 Form of Rights Exercise Agreement to Purchase Common Stock of the
Company.*

5.1 Form of Opinion of Vedder, Price, Kaufman & Kammholz regarding the
legality of the Underlying Shares.*

10.1 Credit Agreement among the Company and The Chase Manhattan Bank.*

10.2 EAC Industries, Inc. 1995 Stock Option.*

23.1 Consent of Lazar, Levine & Company L.L.P.*

23.2 Consent of Vedder, Price, Kaufman & Kammholz (included as part of
Exhibit 5.1).*

24.1 Powers of Attorney pursuant to which amendments to the Registration
Statement may be filed (included on signature page of the Registration
Statement).*

99.1 Form of Transmittal Letter to Holders of Common Stock of the Company.*

99.2 Form of Transmittal Letter to Clients of Securities Dealers,
Commercial Banks, Trust Companies and Other Nominees.*

_______________
* Filed herewith.
(1) Incorporated by reference to Exhibit 3.1 to the Company's Form 10-K
filed with the Commission on April 27, 1987 (Commission File
No. 1-4338).
(2) Incorporated by reference to Exhibit 3.2 to the Company's Form 10-K
filed with the Commission on April 27, 1987 (Commission File
No. 1-4338).

ITEM 28. UNDERTAKINGS

The undersigned registrant hereby undertakes:

1. Insofar as indemnification for liabilities arising under
the Securities Act of 1933 (the "Act") may be permitted to directors,
officers and controlling persons of the small business issuer pursuant
to the foregoing provisions, or otherwise, the small business issuer
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 small business issuer of expenses incurred or paid by a
director, officer or controlling person of the small business issuer
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 small business issuer 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 of whether such indemnification by it is against public
policy as expressed in the Securities Act, and will be governed by the
final adjudication of such issue.

II-2
<PAGE>
<PAGE>

2. The undersigned small business issuer will: (i) for
determining any liability under the Securities Act, treat the
information omitted from the form of prospectus filed as a part of
this registration statement in reliance upon Rule 430A and contained
in a form of prospectus filed by the small business issuer under
Rule 424(b)(1), or (4) or 497(h) under the Securities Act as part of
this registration statement as of the time the Commission declared it
effective, and (ii) for determining any liability under the Securities
Act, treat each post-effective amendment that contains a for of
prospectus as a new registration statement, and that offering of the
securities at that time as the initial bona fide offering of those
securities.

II-3
<PAGE>
<PAGE>

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 for filing on Form SB-2 and authorized this
Registration Statement to be signed on its behalf by the undersigned, in the
City of Branford, State of Connecticut on August 1, 1997.

EAC Industries, Inc.

By:PETER B. FRITZSCHE
------------------------------
Peter B. Fritzsche
Chairman of the Board and
Chief Executive Officer

KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Peter B. Fritzsche, his true and
lawful attorney-in-fact and agent, with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign any and all amendments (including post-effective
amendments) to this Registration Statement, and to file the same, with all
exhibits thereto, and all other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorney-in-fact and
agent full power and authority to do and perform each and every act and
thing requisite and necessary to be done, as fully for all intents and
purposes as he might or could do in person, hereby ratifying and confirming
any and all such acts said attorney-in-fact and agent or his substitute may
lawfully do or cause to be done by virtue hereof.

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 indicated:

Signature Title Date
--------- ----- ----

PETER B. FRITZSCHE Chairman of the Board and President
------------------------------- (Principal Executive Financial and
Peter B. Fritzsche Accounting Officer ) August 1, 1997

E. DONALD MCKENZIE, JR.
_______________________________
E. Donald McKenzie, Jr. Director August 1, 1997

JOHN B. MILLET, JR.
- -------------------------------
John B. Millet, Jr. Director August 1, 1997

P. BARTLEY FRITZSCHE
- -------------------------------
P. Bartley Fritzsche Director August 1, 1997

</TABLE>
II-4
<PAGE>
<PAGE>

EXHIBIT INDEX
-------------

EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
3.1 Restated Certificate of Incorporation of the Company. (1)

3.2 Amended Bylaws of the Company. (2)

4.1 Form of Rights Exercise Agreement to Purchase Common Stock of the
Company.*

5.1 Form of Opinion of Vedder, Price, Kaufman & Kammholz regarding the
legality of the Underlying Shares.*

10.1 Credit Agreement among the Company and The Chase Manhattan Bank.*

10.2 EAC Industries, Inc. 1995 Stock Option.*

23.1 Consent of Lazar, Levine & Company L.L.P.*

23.2 Consent of Vedder, Price, Kaufman & Kammholz (included as part of
Exhibit 5.1).*

24.1 Powers of Attorney pursuant to which amendments to the Registration
Statement may be filed (included on signature page of the Registration
Statement).*

99.1 Form of Transmittal Letter to Holders of Common Stock of the Company.*

99.2 Form of Transmittal Letter to Clients of Securities Dealers,
Commercial Banks, Trust Companies and Other Nominees.*

II-5

<PAGE>
EXHIBIT 4.1

EAC INDUSTRIES, INC.
RIGHTS EXERCISE AGREEMENT
CUSIP NO. 268226 10 7

THE TERMS AND CONDITIONS OF THE RIGHTS OFFERING ARE SET FORTH IN THE
PROSPECTUS OF EAC INDUSTRIES, INC. (THE "COMPANY") DATED _________, 1997
(THE "PROSPECTUS") AND ARE INCORPORATED HEREIN BY REFERENCE. COPIES OF THE
PROSPECTUS ARE AVAILABLE UPON REQUEST FROM THE COMPANY.

THIS RIGHTS EXERCISE AGREEMENT MUST BE RECEIVED BY THE COMPANY AS THE
EXERCISE AGENT WITH PAYMENT IN FULL BY 5:00 P.M., NEW YORK CITY TIME, ON
OCTOBER 31, 1997 OR SUCH LATER DATE TO WHICH THE RIGHTS OFFERING MAY HAVE
BEEN EXTENDED AT THE OPTION OF THE COMPANY (THE "EXPIRATION DATE").

The Rights which are exercisable by this Rights Exercise Agreement
may be exercised by duly completing Form 1 or may be exercised through a
bank or broker by duly completing Form 2. Rights holders are advised to
review the Prospectus, copies of which are available from the Company as
the exercise agent, before exercising their Rights. IMPORTANT: Complete
the appropriate FORM and SIGN as noted.

EAC INDUSTRIES, INC.

By_______________________________
Peter F. Fritzsche
President and CEO

AN EXERCISE OF RIGHTS EVIDENCED HEREBY IS IRREVOCABLE. NO PARTIAL
EXERCISE IS PERMITTED.

FORM 1 - RIGHTS EXERCISE AND SUBSCRIPTION: The undersigned hereby
irrevocably exercises all Rights to subscribe for shares of Common Stock as
indicated below, on the terms and subject to the conditions specified in
the Prospectus, receipt of which is hereby acknowledged.

(a) Number of shares owned by the undersigned which is the
same number subscribed for pursuant to the Subscription Privilege
(one Right needed to subscribe for each full share):

(b) Total Exercise Price (total number of shares subscribed
for times the Exercise Price of $.22): $_________<FN1>

METHOD OF PAYMENT

CHECK, BANK DRAFT OR MONEY ORDER PAYABLE TO EAC INDUSTRIES,
INC. Amount: ______________

- ---------------------
<FN1> Partial exercises are not permitted. However, if the amount
enclosed or transmitted is not sufficient to pay the Exercise Price for all
shares subscribed for, or if the number of shares being subscribed for is
not specified, the Company has the right and option to take the position
that the number of shares subscribed for will be assumed to be the maximum
number that could be subscribed for upon payment of such amount.
<PAGE>
<PAGE>
WIRE TRANSFER DIRECTED TO THE COMPANY ACCOUNT AT MANUFACTURERS
HANOVER BANK, Account No. __________; ABA No. __________.
Amount: ______________

FORM 2 - TO EXERCISE YOUR RIGHTS THROUGH YOUR BANK OR BROKER: For
value received, Rights represented by this Rights Exercise Agreement are
hereby assigned to (please print name and address and Social Security No.
of transferee in full):

Name: ____________________________________

Address: _________________________________

Social Security Number ___________________

FORM 3 - SPECIAL DELIVERY INSTRUCTIONS: Name and/or address for
mailing any stock certificate if other than shown on the face hereof:

Name:_____________________________________

Address:__________________________________

__________________________________________
(including zip code)

IMPORTANT
RIGHTS HOLDER SIGN HERE
AND, IF RIGHTS ARE BEING EXERCISED
COMPLETE SUBSTITUTE FORM W-9

_________________________________
(Signature(s) of Registered
Holder(s))

Dated: _________________, 199_

(Must be signed by the registered holder(s) exactly as name(s) appear(s) on
the Stock Certificate representing shares of EAC Industries, Inc. If
signature is by trustee(s), executor(s), administrator(s), guardian(s),
attorney(s)-in-fact, agent(s), officer(s) or a corporation or another
acting in a fiduciary or representative capacity, please provide the
following information.)

Name(s)

__________________________________________
(Please Print)

Capacity _________________________________

Address __________________________________
(Including Zip Code)

Area Code and Telephone Number ___________
(Home)

___________
(Business)
Tax Identification or Social
Security No. ___________________________
(Complete Substitute
Form W-9)

<PAGE>

EXHIBIT 5.1

[FORM OF OPINION OF VEDDER, PRICE, KAUFMAN & KAMMHOLZ]

_______________________, 1997

EAC Industries, Inc.
22 Blackstone Avenue
Branford, Connecticut 06405

Gentlemen:

Reference is hereby made to the Registration Statement on Form SB-2
(Registration No. 333-____________) (the "Registration Statement"), filed by
EAC Industries, Inc., a New York corporation (the "Company"), with the
Securities and Exchange Commission in connection with the proposed issuance
of non-transferrable rights (the "Rights") to purchase up to 2,283,551
shares of Common Stock, par value $.10 per share (the "Common Stock").

We have acted as special counsel for the Company in connection with
the proposed offering.

In rendering this opinion, we have assumed the authenticity, accuracy
and completeness of all documents submitted to us as originals, the
conformity to authentic original documents of all documents submitted to us
as certified, conformed or photostatic copies and the genuineness of all
signatures.

It is our opinion that the 2,283,551 shares of Common Stock that may
be sold by the Company upon exercise of the Rights in accordance with said
Registration Statement, if and when so sold, will be legally issued, fully
paid and non-assessable.

We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the use of our name under the heading "Legal
Matters" in the Prospectus included therein.

Very truly yours,

<PAGE>

EXHIBIT 10.1

[CHASE LETTERHEAD]

The Chase Manhattan Bank
East 36 Midland Avenue
Paramus, NJ 07652

May 13, 1997

Mr. Steven W. Mann,
President
Goodren Products Corporation
101 West Forest Avenue
Englewood, New Jersey 07631

Dear Mr. Mann:

We are pleased to advise you that based upon your interim financial
statements for the nine months end October 31, 1996, The Chase Manhattan
Bank (the "Bank") has approved your request for a line of credit in the
aggregate amount of $500,000 through 3/31/98. Our officers may, in their
discretion, make short-term loans to Goodren Products Corporation (the
"Borrower") on such terms as are mutually agreed upon between us, from time
to time.

Borrowings under this line of credit are intended to be used to meet the
normal short-term working capital needs of Goodren Products Corporation and
will bear interest at The Chase Manhattan Bank's Prime Rate plus 200 basis
points.

This line will carry a $2,000 administrative fee payable immediately. As
this line is not a commitment, credit availability is, in addition, subject
to your execution and delivery of such documentation as the Bank deems
appropriate and the receipt and continuing satisfaction with current
financial information, which information will be furnished to the Bank as it
may from time to time reasonably request. This line of credit expires on
March 31, 1998.

We are pleased to be of service and trust you will call upon us to assist in
any of your banking requirements.

Very truly yours,

/s/ MICHAEL J. MILLER
- ---------------------
Michael J. Miller,
Vice President

<PAGE>

EXHIBIT 10.2

EAC 1995 Stock Option Plan

1. Objectives. The EAC 1995 Stock Option Plan (the "Plan") is
designed to attract and retain executives and other selected employees
whose skills and talents are important to the Company's operations, and
reward them for making major contributions to the success of the Company.
These objectives are accomplished by making long-term incentive awards
under the Plan, thereby providing Participants with a proprietary interest
in the growth and performance of the Company.

2. Definitions.

(a) "Award" - The grant of a stock option, to a Plan Participant
pursuant to such terms, conditions, performance requirements, and
limitations as the Committee may establish in order to fulfill the
objectives of the Plan.

(b) "Award Agreement" - An agreement between the Company and a
Participant that sets forth the terms, conditions, performance
requirements, and limitations applicable to an Award.

(d) "Capital Stock" or "stock" - Authorized and issued or unissued,
$__________ par value, capital stock of the Company.

(e) "Code" - The Internal Revenue Code of 1986, as amended from
time to time.

(f) "Committee" - The committee designated by the Board to
administer the Plan. The Committee shall be constituted to permit the Plan
to comply with Rule 16b-3 promulgated under the Securities Exchange Act of
1934 or any successor rule. No member of the Committee may receive Awards
under the Plan, other than in accordance with Section 7 hereof.

(g) "Company" - EAC Industries, Inc. ("EAC") and its subsidiaries
including subsidiaries of subsidiaries and partnerships and other business
ventures in which EAC has a significant equity interest, as determined in
the sole discretion of the Committee.

(h) "Fair Market Value" - The average of the high and low sale
prices of Capital Stock as reported by the National Association of
Securities Dealers Automatic Quotation System ("NASDAQ") for the date in
question, provided that, if no sales of Capital Stock were made on that
date, the average of the closing bid and asked quotations for the Capital
Stock on such date, as reported by the NASDAQ.
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(i) "Non-Employee Director" - A member of the Board of Directors
who is not, nor in the preceding twelve months has been, an employee of the
Company.

(j) "Participant" - An employee of the Company or a member of the
Board to whom an Award has been made under the Plan.

3. Eligibility. Employees of the Company eligible for an Award
under the Plan are those who hold positions of responsibility and whose
performance, in the judgment of the Committee can have a significant effect
on the success of the Company.

4. Capital Stock Available for Awards. The number of shares that
may be issued under the Plan for Awards granted during the term of the Plan
is 230,000. Capital Stock related to Awards that are forfeited,
terminated, expire unexercised, settled in such manner that all or some of
the shares covered by the Award are not issued of the shares covered by the
Award are not issued to a Participant, shall immediately become available
for Awards.

5. Administration. The Plan shall be administered by the
Committee, which shall have full and exclusive power to interpret the Plan,
to grant waivers of Award restrictions, and to adopt such rules,
regulations and guidelines for carrying out the Plan as it may deem
necessary or proper, all of which powers shall be executed in the best
interests of the Company and in keeping with the objectives of the Plan.

6. Awards. Awards shall be made in the form of stock options.
The Committee shall set forth in the related Award Agreement the terms,
conditions, performance requirements, and/or limitations applicable to each
Award; provided, that in no event shall any option granted hereunder be
exercisable more than ten years after the date of grant. No Participant may
receive Awards of stock options in any calendar year which, in the
aggregate, relate to more than 75,000 shares. Stock options granted
hereunder shall be limited a grant of a right to purchase a specified
number of shares of Capital Stock the purchase price of which shall not be
less than 100% of Fair Market Value on the date of grant of such right, as
determined by the Committee. A stock option may be in the form of an
incentive stock option ("ISO") which, in addition to being subject to
applicable terms, conditions and limitations established by the Committee,
complies with Section 422 of the Code which, among other limitations
provides that the aggregate Fair Market Value (determined at the time the
option is granted) of Capital Stock for which ISO's are exercisable for the
first time by a Participant during any calendar year shall not exceed
$100,000; that ISO's shall be priced at not less than 100% of the Fair
Market Value on the date of the grant; and that ISO's shall be exercisable
for a period of not more than ten years. The number of shares of stock
that shall be available for ISO's granted under the Plan is limited to
230,000.

7. Awards to Non-Employee Directors. On the date of each annual
meeting of shareholders of the Company occurring on or after the Effective
Date of the Plan, each Non-Employee Director who is a Non-Employee Director
after such meeting of shareholders shall be granted an Option to purchase
2,500 shares of Capital Stock at a purchase price per share equal to

2
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the Fair Market Value of a share of Stock on the date of grant of such
Option. Each such Option shall be exercisable in full six months after the
date of grant and shall be exercisable for a period of ten years. Except
as provided in this Section 7, no Non-Employee Director shall be eligible
to be granted any other Awards under this Plan. The maximum number of
Options that may be granted to all Non-Employee Directors shall not exceed
30% of shares covered by the Plan.

8. Stock Option Exercise. The price at which shares of Capital
Stock may be purchased under a Stock Option shall be paid in full at the
time of the exercise in cash or, if permitted by the Committee, by means of
tendering previously-owned Capital Stock valued at Fair Market Value on the
date of exercise, or any combination thereof. The Committee shall
determine acceptable methods for tendering Capital Stock and may impose
such conditions on the use of Capital Stock to exercise a Stock Option as
it deems appropriate.

9. Tax Withholding. The Company shall have the right to deduct
applicable taxes from any Award payment and withhold, at the time of
delivery shares under the Plan, an appropriate number of shares for payment
of taxes required by law or to take such other action as may be necessary
in the opinion of the Company to satisfy all obligations for withholding of
such taxes. If Capital Stock is used to satisfy tax withholding, such
stock shall be valued based on the Fair Market when the tax withholding is
required to be made.

10. Amendment, Modification, Suspension or Discontinuance of the
Plan. The Board may amend, modify, suspend or terminate the Plan for the
purpose of meeting or addressing any changes in legal requirements or for
any other purpose permitted by law; provided that the formula set forth in
Section 7 hereof shall not be amended more than once in any six-month
period. Subject to changes in law or other legal requirements that would
permit otherwise, the Plan may not be amended without the consent of the
holders of a majority of the shares of Capital Stock the outstanding, to
(a) increase the aggregate number of shares of Capital Stock that may be
issued under the Plan (except for adjustments pursuant to Section 13 of the
Plan), (b) decrease the option price, (c) materially modify the
requirements as to eligibility for participation in the Plan, (d) withdraw
administration of the Plan from the Committee, or (e) extend the period
during which Awards may be granted.

11. Termination of Employment. If the employment of a Participant
terminates, all unexercised Awards shall terminate 90 days after the date
employment terminated, unless the Award Agreement provides otherwise.

When a Participant's employment terminates (a) as a result of
retirement with management approval in accordance with the terms of a
Company retirement plan, (b) as a result of resignation from the Company
and, in the judgment of the chief executive officer or other senior
officers designated by the Company, the acceleration and/or continuation of
outstanding Awards would be in the best interests of the Company, or (c) in
the event of a Participant's death or disability, the Committee may (in the
form of an Award Agreement or otherwise) (i) authorize, where appropriate,
the acceleration and/or continuation of all or any part of Awards granted

3
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prior to such termination and (ii) permit the exercise and vesting of such
Awards for such period as may be set forth in the applicable Award
Agreement. Rights to any such outstanding Awards shall pass by will or the
laws of descent and distribution in the following order: (A) to
beneficiaries so designated by the Participant; if none, then (B) to a
legal representative of the Participant; if none, then (C) to the persons
entitled thereto as determined by a court of competent jurisdiction.

12. Nonassignability. Except pursuant to Section 11, no Award
shall be assignable or transferable, or payable to or exercisable by,
anyone other than the Participant to whom it was granted.

13. Adjustments. In the event of any change in the outstanding
Capital Stock of the Company by reason of a stock split, stock dividend,
combination or reclassification of shares, recapitalization, merger, or
similar event, the Committee may adjust proportionally (a) the number of
shares of Capital Stock (i) reserved under the Plan, (ii) available for
ISO's and Awards to Non-Employee Directors, (iii) for which Awards may be
granted to an individual Participant, and (iv) covered by outstanding
Awards; (b) the stock prices related to outstanding Awards and (c) the
appropriate Fair Market Value and other price determinations for such
Awards. In the event of any change affecting the Capital Stock or any
distribution (other than normal cash dividends) to holders of Capital
Stock, such adjustments as may be deemed equitable by the Committee,
including adjustments to avoid fractional shares, shall be made to give
proper effect to such event. In the event of a corporate merger,
consolidation, acquisition of property or stock, separation, reorganization
or liquidation, the Committee shall be authorized to issue or assume Stock
Options, whether or not in a transaction to which Section 424(a) of the
Code applies, by means of substitution of new Stock Options for previously
issued Stock Options or an assumption of previously issued Stock Options.

14. Governing Law. The Plan and all determinations made and
actions taken pursuant hereto, to the extent not otherwise governed by the
laws of the United States, shall be governed by the laws of the State of
New York and construed accordingly.

15. Effective and Termination Dates. The Plan shall become
effective on the date it is approved by the holders of a majority of the
shares of Capital Stock then outstanding. The Plan shall terminate ten
years later, subject to earlier termination by the Board pursuant to
Section 10, after which no Awards may be made under the Plan, but any such
terminations shall not affect Awards then outstanding or the authority of
the Committee to continue to administer the Plan.

<PAGE>

EXHIBIT 23.1

CONSENT OF INDEPENDENT ACCOUNTANTS
__________________________________

We consent to the incorporation by reference in the registration
statement of EAC Industries, Inc. on Form SB-2, of our report dated
April 4, 1997 of our audit of the consolidated financial statements of EAC
Industries, Inc. and subsidiaries as of January 31, 1997 and 1996, and for
the fiscal years ended January 31, 1997 and 1996, included in the Annual
Report on Form 10-KSB and in the Company's 1997 Annual Report to
Stockholders. We also consent to the reference in the Prospectus to our
firm under the caption "Experts."

LAZAR, LEVINE & COMPANY LLP

New York, New York
July 30, 1997

<PAGE>

EXHIBIT 99.1

LETTER OF TRANSMITTAL

AUGUST __, 1997

IMPORTANT NOTICE
CONCERNING YOUR RIGHT TO SUBSCRIBE FOR COMMON STOCK

To Holders of EAC Common Stock:

Enclosed for your consideration are a Prospectus, dated August __,
1997, and the EAC Industries, Inc. Rights Exercise Agreement relating to
the offer of 2,283,551 shares (the "Underlying Shares") of common stock,
$.10 par value per share (the "Common Stock"), of EAC Industries, Inc. (the
"Company") at an exercise price of $.22 per share, in cash (the "Exercise
Price"), pursuant to non-transferable subscription rights (the "Rights")
distributed to holders of record ("Record Holders") of Common Stock of the
Company, as of the close of business on October 1, 1997 (the "Record
Date").

As described in the accompanying Prospectus, you will receive one
(1) transferable Rights for every share of Common Stock held of record by
you as of the Record Date. Each Right will entitle you to subscribe for one
share of Common Stock (the "Subscription Privilege") at the Exercise Price.
Information on the Federal income tax treatment of the Rights and the
Common Stock is provided in the Prospectus.

The net proceeds to the Company of the Rights Offering will be used
to temporarily repay working capital indebtedness and for general corporate
purposes.

Rights are non-transferable. They must be exercised in full; partial
exercise will not be permitted.

If you wish to subscribe for Common Stock, your executed Rights
Exercise Agreement, filled out to indicate your choice of options, must be
received along with the aggregate Exercise Price by the Company acting as
the exercise agent by 5:00 p.m., New York City time, on the Expiration
Date. After the Expiration Date, Rights will no longer be exercisable to
purchase shares of Common Stock.

ANY QUESTIONS OR REQUESTS FOR ASSISTANCE CONCERNING THE OFFERING
SHOULD BE DIRECTED TO THE COMPANY AS THE EXERCISE AGENT, AT THE FOLLOWING
TELEPHONE NUMBER: (203) 315-8020.

Very truly yours,

Peter B. Fritzsche
CHAIRMAN OF THE BOARD OF
DIRECTORS,
PRESIDENT AND CHIEF EXECUTIVE
OFFICER

Enclosures

<PAGE>

EXHIBIT 99.2

EAC INDUSTRIES, INC.
__________ SHARES OF COMMON STOCK
OFFERED PURSUANT TO RIGHTS DISTRIBUTED
TO STOCKHOLDERS OF EAC INDUSTRIES, INC.

To Securities Dealers, Commercial Banks,
Trust Companies and Other Nominees:

Enclosed are a Prospectus, dated August __, 1997 (the "Prospectus"),
and Rights Exercise Agreement relating to EAC Industries, Inc. Rights (the
"Agreement"), and to the offering of 2,283,551 shares of common stock, par
value $.10 per share (the "Common Stock"), of EAC Industries, Inc. (the
"Company"), at a price of $.22 per share, in cash, pursuant to non-
transferable subscription rights (the "Rights") distributed to holders of
record of Common Stock, as of the close of business on October 1, 1997 (the
"Record Date"). The Rights are described in the Prospectus and evidenced by
the Agreement with respect to the Rights registered in your name or the name
of your nominee on the books of the Company.

Each beneficial owner of Common Stock registered in your name or the
name of your nominee is entitled to one (1) Right for each share of Common
Stock owned by such beneficial owner.

We are asking you to contact your clients for whom you hold shares of
Common Stock registered in your name or in the name of your nominee to
obtain instructions with respect to the Rights.

You will be reimbursed for customary mailing and handling expenses
incurred by you in forwarding any of the enclosed materials to your clients.
Except for the costs incurred by the Company as the exercise agent (which
are as described in the Prospectus) all commissions, fees and other expenses
(including brokerage commissions and transfer taxes) incurred in connection
with the exercise of Rights will be for the account of the owner of the
Rights, and none of such commissions, fees or expenses will be paid by the
Company. However, the Company will pay all transfer taxes, if any,
applicable to the sale of shares of Common Stock upon the exercise of
Rights.

Enclosed are copies of the following documents:

1. The Prospectus;

2. The "EAC Industries, Inc. Rights Exercise Agreement"
(including Guidelines For Certification of Taxpayer Identification on
Substitute Form W-9);

3. A form of letter which may be sent to your clients for
whose accounts you hold shares of the Company's Common Stock
registered in your name or the name of your nominee, with space
provided for obtaining such clients' instructions with regard to the
Rights;

4. A return envelope addressed to the Company, the exercise
agent.

Your prompt action is requested. The Rights will expire at 5:00 P.M.,
New York City time, on October 31, 1997, unless extended by the Company at
its discretion (the "Expiration Date").

To exercise Rights, a properly completed and executed Rights Exercise
Agreement and payment in full for all Rights exercised must be delivered to
the Company as the exercise agent as indicated in the Prospectus prior to
5:00 P.M., New York City time, on the Expiration Date.
<PAGE>
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Additional copies of the enclosed materials may be obtained from the
Company as the exercise agent.

Very truly yours,

Peter B. Fritzsche
CHAIRMAN OF THE BOARD OF
DIRECTORS,
PRESIDENT AND CHIEF EXECUTIVE
OFFICER

NOTHING HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU OR
ANY PERSON AS AN AGENT OF EAC INDUSTRIES, INC. OR ANY OTHER PERSON MAKING OR
DEEMED TO BE MAKING OFFERS OF THE COMMON STOCK, OR AUTHORIZE YOU OR ANY
OTHER PERSON TO MAKE ANY STATEMENTS ON BEHALF OF ANY OF THEM WITH RESPECT TO
THE OFFERING, EXCEPT FOR STATEMENTS EXPRESSLY MADE IN THE PROSPECTUS OR THE
RIGHTS EXERCISE AGREEMENT.