<PAGE> 1
As filed with the Securities and Exchange Commission on June 7, 1996
File No. 33-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
Under
The Securities Act of 1933
CREATIVE LEARNING PRODUCTS, INC.
-----------------------------------------------------
(Exact Name of Registrant as Specified in Its Charter)
New Jersey 22-2930106
------------------------------- ---------------------
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
150 Morris Avenue, Suite 205, Springfield, New Jersey 07081
- -------------------------------------------------------------------------------
(Address of Principal Executive Offices) (Zip Code)
Consulting Agreement dated as of April 16, 1996
-----------------------------------------------------
(Full Title of the Plan)
Mr. Peter J. Jegou
Creative Learning Products, Inc.
150 Morris Avenue, Suite 205
Springfield, NJ 07081
(201) 467-0266
-----------------------------------------------------
(Name, Address and Telephone Number of Agent for Service)
Copy to:
Robert W. Berend, Esq.
Gold & Wachtel, LLP
110 East 59th Street
New York, NY 10022
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Proposed Proposed
Title of Maximum Maximum
Securities Amount Offering Aggregate Amount of
to be to be Price Offering Registra-
Registered Registered Per Share(1) Price(1) tion Fee
------------- ---------- ------------ ------------ ------------
<S> <C> <C> <C> <C>
Common Stock, 1,000,000 $0.75 $750,000 $259
no par value shares
</TABLE>
- ------------------
(1) Estimated solely for the purpose of calculating the registration fee. The
proposed maximum offering price and the registration fee for the shares to
be issued upon the exercise of the CLPI Warrants are computed, pursuant to
Rule 457(h), on the basis of the exercise price of the CLPI Warrant as set
forth in the Consulting Agreement.
<PAGE> 2
PROSPECTUS
CREATIVE LEARNING PRODUCTS, INC.
1,000,000 SHARES
OF
COMMON STOCK, NO PAR VALUE
ISSUABLE UPON THE EXERCISE OF A WARRANT
EXPIRING APRIL 15, 1999
---------------
CONSULTING AGREEMENT DATED AS OF APRIL 16, 1996 BY AND BETWEEN
CREATIVE LEARNING PRODUCTS, INC. AND LEE ROSEN
---------------
This Prospectus relates to an offering by Creative Learning Products, Inc.
("CLPI") of an aggregate of 1,000,000 shares of CLPI's Common Stock, no par
value (the "Common Stock"), to be issued to Lee S. Rosen (the "Consultant")
upon the exercise of a warrant expiring April 15, 1999 (the "Warrant") granted
pursuant to a written consulting agreement dated as of April 16, 1996 (the
"Agreement") by and among CLPI and the Consultant.
---------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
---------------
This Prospectus does not constitute an offer to sell securities in any
state to any person to whom it is unlawful to make such offer in such state.
---------------
The date of this Prospectus is June 7, 1996
<PAGE> 3
AVAILABLE INFORMATION
CLPI is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and, in accordance
therewith, files reports, proxy and information statements and other
information with the Securities and Exchange Commission (the "Commission").
Reports, proxy statements and other information filed with the Commission can
be inspected and copied at the public reference facilities of the Commission at
Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549, as well as at the
following regional offices of the Commission: 7 World Trade Center, Suite 1300,
New York, New York 10048 and Northwestern Atrium Center, 500 West Madison
Street, Suite 1400, Chicago, Illinois 60661-2511. Copies of this material can
also be obtained at prescribed rates from the Public Reference Section of the
Commission at its principal office at 450 Fifth Street, N.W., Washington, D.C.
20549. Because the Common Stock is traded on the National Association of
Securities Dealers Automated Quotation ("NASDAQ") System, reports, proxy and
information statements and other information concerning CLPI can also be
inspected by contacting the National Association of Securities Dealers, Inc.
(the "NASD"), NASDAQ Reports Section, at 1735 K Street, N.W., Washington, D.C.
20006-1506.
CLPI has filed with the Commission a Registration Statement on Form S-8
(the "Registration Statement") under the Securities Act of 1933, as amended
(the "Securities Act"), with respect to an aggregate of 1,000,000 shares of the
Common Stock to be issued to the Consultant upon the exercise of the Warrant
granted pursuant to the Agreement. This Prospectus, which is Part I of the
Registration Statement, omits certain information contained in the Registration
Statement. For further information with respect to CLPI and the shares of the
Common Stock offered by this Prospectus, reference is made to the Registration
Statement, including the exhibits thereto. Statements in this Prospectus as to
any document are not necessarily complete and, where any such document is an
exhibit to the Registration Statement or is incorporated herein by reference,
each such statement is qualified in all respects by the provisions of such
exhibit or other document, to which reference is hereby made for a full
statement of the provisions thereof. A copy of the Registration Statement,
with exhibits, may be obtained from the Commission's office in Washington, D.C.
(at the above address) upon payment of the fees prescribed by the rules and
regulations of the Commission, or examined there without charge.
CLPI will provide without charge to each person to whom a Prospectus
has been delivered, upon the written or oral request of such person, a copy of
any or all of the information that has been incorporated by reference in the
Prospectus (not including exhibits to such information that is incorporated by
reference
2
<PAGE> 4
unless such exhibits are specifically incorporated by reference into
the information that the Prospectus incorporates). Requests for such copies
should be directed to Creative Learning Products, Inc., Attention: Walter J.
Krzanowski, Chief Financial Officer, 150 Morris Avenue, Suite 205, Springfield,
NJ 07081, Telephone: (201) 467-0266.
No person has been authorized by CLPI to give any information or to
make any representation other than as contained in this Prospectus and, if
given or made, such information or representation must not be relied upon as
having been authorized by CLPI. Neither the delivery of this Prospectus nor
any distribution of the shares of the Common Stock underlying the warrants
under the terms of the consulting agreement (which constitutes the plan) shall,
under any circumstances, create any implication that there has been no change
in the affairs of CLPI since the date hereof.
3
<PAGE> 5
CONSULTING AGREEMENT DATED AS OF APRIL 16, 1996 BY AND BETWEEN
CREATIVE LEARNING PRODUCTS, INC.
AND
LEE S. ROSEN
---------------
1,000,000 SHARES OF THE COMMON STOCK, NO PAR VALUE,
ISSUABLE UPON THE EXERCISE OF A WARRANT EXPIRING
APRIL 15, 1999
PART I
ITEM 1. PLAN INFORMATION
GENERAL PLAN INFORMATION
Creative Learning Products, Inc., a New Jersey corporation ("CLPI"), is
offering by this Prospectus an aggregate of 1,000,000 shares (the "Shares") of
CLPI's Common Stock, no par value (the "Common Stock"), to be issued upon the
exercise of a Common Stock purchase warrant issued pursuant to a written
consulting agreement dated as of April 16, 1996 (the "Agreement") by and among
CLPI and Lee S. Rosen (the "Consultant"). Under the Agreement the Consultant
has provided and will continue to provide, certain consulting services, as
hereinafter described, to CLPI. The Consultant has accepted, as compensation
for his services, a Common Stock purchase Warrant expiring April 15, 1999 (the
"Warrant"), to purchase 1,000,000 shares of the Common Stock (the "Shares"). The
purpose of the form of compensation provided for in the Agreement is to provide
the Consultant with an opportunity to acquire the Shares on favorable terms by
exercising the Warrant and thereby create a proprietary interest in the
progress and success of the business of CLPI and provide him with maximum
incentive to perform his consulting services at the highest possible level.
The following description of the Agreement is only a summary and does
not purport to be complete. It is qualified in its entirety by reference to
the complete text of the Agreement, a copy of which is filed as Exhibit 4(b) to
the Registration Statement of which this Prospectus is a part and is
incorporated herein by this reference.
Pursuant to the Agreement, the Consultant agreed to assist CLPI with
respect to CLPI's relationships with its shareholders, potential investors in
CLPI and industry analysts, but not with respect to the offer or sale of
securities in a capital raising transaction. Services have been, and will
continue to be,
4
<PAGE> 6
provided by the Consultant as CLPI may reasonably request. The term of the
Agreement is for two years commencing on April 16, 1996. Either CLPI or the
Consultant may terminate the Agreement earlier for cause (as such term is
defined), see "Forfeitures and Penalties".
CLPI has agreed to file this Registration Statement with respect to the
Shares. CLPI will pay all expenses related to this Registration Statement. The
Consultant has represented that he has acquired the Warrant for investment
purposes only and not with a view to, or in connection with, the resale or
distribution thereof.
The Agreement contains provisions, hereinafter summarized, relating to
non-disclosure of confidential information by the Consultant, indemnification
and other matters.
The Agreement is not subject to the provisions of the Employee
Retirement Income Security Act of 1974 ("ERISA") and is not qualified under
Section 401(a) of the Internal Revenue Code of 1986, as amended (the "Code").
CLPI and its subsidiaries are referred to herein as the "Company."
SECURITIES TO BE OFFERED
Pursuant to the Agreement, the number of the shares of the Common Stock
as to which the Warrant was granted and is to be exercised is 1,000,000 shares.
EMPLOYEES WHO MAY PARTICIPATE IN THE PLAN
The Consultant may exercise the Warrants prior to their Expiration
Date.
PURCHASE OF SECURITIES PURSUANT TO THE PLAN
AND PAYMENT FOR SECURITIES OFFERED
The Warrant may be exercised until the close of business on April 15,
1999 (the "Expiration Date") for up to 1,000,000 shares of the Common Stock at
an exercise price of $0.75 per share.
Subject to the limitations in the preceding paragraph, the Consultant
may exercise the Warrant with respect to all of the Shares then available for
purchase or with respect to such lesser number of shares of the Shares as he,
from time to time, desires prior to the Expiration Date or the Warrant's
earlier termination.
The Warrant will be deemed exercised upon receipt by CLPI, at its
principal office, during the term of the Warrant of (a) a
5
<PAGE> 7
written notice signed by the Consultant advising of the Consultant's exercise
of the Warrant with respect to the specified number of shares of the Shares and
(b) payment in the form of a check, bank draft or money order of the
full purchase price for the number of shares of the Shares covered by the
notice. A check, bank draft or money order will be accepted as payment,
subject to collection, and stock certificates registered in the name of the
Consultant for the number of shares of the Shares covered by such exercise will
be delivered by CLPI within five business days after such collection. The
shares of the Common Stock to be issued upon exercise will be issued from
authorized but unissued shares (or, if available and the Board of Directors of
CLPI so directs, from treasury shares) and CLPI will not purchase shares in the
open market for such purpose.
WITHDRAWAL FROM THE PLAN; ASSIGNMENT OF INTEREST
The Warrant may be assigned in whole or in part by the Consultant upon
execution of an assignment by the Consultant.
FORFEITURES AND PENALTIES
The Agreement may be terminated upon (a) the Consultant's or CLPI's
material breach of his or its covenants and agreements under the Agreement or
(b) the Consultant (i) being convicted of a felony under the laws of any state
or the United States, whether directed toward the Company or otherwise, or (ii)
committing larceny, embezzlement or other act of fraud or dishonesty against
the Company, or (ii) using the Company's facilities or premises for the conduct
of illegal or unlawful activities, transactions or businesses. The defaulting
party has 30 days to cure any default under (a) above. If the Agreement is
terminated prior to the full exercise of the Warrant for reasons other than the
default of CLPI, the Warrant terminates as to the shares for which it has not
been exercised on a pro rata basis.
TAX EFFECTS OF PLAN PARTICIPATION
The following is a summary of the Federal income tax provisions under
the Code currently applicable to the Warrant, including the consequences of
exercise, based upon advice to CLPI by Gold & Wachtel, LLP, its counsel. The
Consultant should consult his own tax advisors concerning legislative or
administrative developments, as well as his individual Federal income tax
position before exercising the Warrant or disposing of any shares of the Shares
acquired upon the exercise of the Warrant. CLPI makes no representation as to
the tax status or effect of the Warrant under the Code or the tax consequences
under the laws of any state or other jurisdiction of the granting of the
Warrant, any exercise thereof or of any sale of any shares of the Shares
acquired pursuant thereto.
6
<PAGE> 8
The grant of a Warrant under the Agreement has no immediate tax
consequences to the Consultant or CLPI under the Code. Upon the exercise of
the Warrant, the Consultant will recognize ordinary income and CLPI will be
entitled to a deduction in an amount equal to the excess of the fair market
value of the shares of the Shares as to which the Warrant is exercised over the
exercise price on the date of the exercise of the Warrant. The Consultant's
tax basis in such shares of the Shares will be the exercise price plus the
amount of ordinary income recognized by the Consultant, and the Consultant's
holding period will commence on the date of exercise.
Upon a subsequent sale of any shares of the Shares, any difference
between the tax basis of such shares of the Shares and the amount realized on
the sale is treated under the Code as short-term or long-term capital gain or
loss, depending on the holding period of such shares of the Shares.
Ordinary income recognized by virtue of the exercise of a Warrant is
subject to applicable withholding as required by law.
ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE AGREEMENT
ANNUAL INFORMATION
CLPI will provide, without charge, to the Consultant, upon its written
or oral request, a copy of CLPI's latest Annual Report on Form 10-KSB for the
fiscal year ended May 31, 1995, which document is incorporated herein by this
reference in this Prospectus and is made a part hereof. There is also
incorporated herein by this reference and made a part hereof, all documents
filed and to be filed by CLPI pursuant to Sections 13(a), 13(c), 14 and 15(d)
of the Exchange Act prior to the filing of a post-effective amendment to the
Registration Statement which indicates that all securities offered by this
Prospectus have been sold or which deregisters all securities then remaining
unsold. Requests for such information should be directed to Walter J.
Krzanowski, Chief Financial Officer, Creative Learning Products, Inc., 150
Morris Avenue, Suite 205, Springfield, NJ 07081; Telephone: (201) 467-0266.
7
<PAGE> 9
TABLE OF CONTENTS
- -----------------------------------
Page
----
Available Information............2
Plan Information
General Plan Information.......4
Securities To Be Offered.......5
Employees Who May
Participate in the Plan......5
Purchase of Securities
Pursuant to the Plan and
Payment For Securities
Offered......................5
Withdrawal from the Plan;
Assignment of Interest.......6
Forfeitures and Penalties......6
Tax Effects of Plan
Participation................6
Registrant Information and
Employee Agreement Annual
Information..................7
- -----------------------------------
- -----------------------------------
CREATIVE LEARNING
PRODUCTS, INC.
1,000,000 SHARES OF COMMON
STOCK ISSUABLE UPON THE
EXERCISE OF A WARRANT EXPIRING
APRIL 15, 1999
- -----------------------------------
Prospectus dated June 7, 1996
<PAGE> 10
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The Registrant's Annual Report on Form 10-KSB for the fiscal year ended May
31, 1995 and its Quarterly Reports on Form 10-QSB for the quarters ended August
31, 1995, November 30, 1995 and February 29, 1996 are each incorporated by
reference in this Registration Statement and made a part hereof. There is also
incorporated herein by reference hereto and made a part hereof the Registrant's
registration statement on Form 8A dated April 25, 1989 and all other documents
subsequently filed by the Registrant pursuant to Sections 13(a), 13(c), 14 and
15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
prior to the filing of a post-effective amendment to this Registration
Statement which indicates that all securities offered by the Prospectus have
been sold or which deregisters all securities then remaining unsold. Such
documents shall be deemed to be incorporated by this reference and to be made a
part hereof from the date of filing of such documents. In addition, the
audited consolidated financial statements of the Registrant to be included in
subsequently filed documents will be incorporated herein in reliance upon the
reports of BDO Seidman, LLP pertaining to such financial statements (to the
extent covered by consents filed with the Securities and Exchange Commission)
given upon the authority of such firms as experts in accounting and auditing.
ITEM 4. DESCRIPTION OF SECURITIES
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
The consolidated financial statements of the Registrant appearing in the
Registrant's Annual Report on Form 10-KSB for the fiscal year ended May 31,
1995 have been audited by BDO Seidman, LLP, independent auditors, insofar as
they related to the fiscal year ended May 31, 1995 and by Ernst & Young LLP,
independent auditors, insofar as they related to the fiscal year ended May 31,
1994, as set forth in their reports thereon included therein and incorporated
herein by reference. Such financial statements are incorporated herein in
reliance on the reports of BDO Seidman, LLP and Ernst & Young LLP pertaining to
such financial statements given on the authority of each such firm as experts
in accounting and auditing.
The validity of the securities offered hereby will be passed upon for the
Registrant by Gold & Wachtel, LLP, 110 East 59th
9
<PAGE> 11
Street, New York, New York 10022. Gold & Wachtel, LLP is the holder of 178,750
shares of the Common Stock and a Common Stock purchase warrant to purchase
114,387 shares of the Common Stock at $1.311 per share (both the number of
shares and the exercise price being subject to further adjustments pursuant to
the antidilution provision thereof), the shares and the Warrant being received
in lieu of payments for legal fees.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Article VI of the Articles of Incorporation of the Registrant provides
indemnification of persons including directors and officers of the Registrant
to the fullest extent permitted by the Business Corporation Act of the State of
New Jersey (the "BCA").
Section 14A:3-5(2) of the BCA empowers a corporation to indemnify a
corporate agent (which term includes a director or officer) against his or her
expenses and liabilities in connection with any proceeding involving the
corporate agent, other than a proceeding by, or in the right of, the
corporation, if such corporate agent acted in good faith and in a manner he or
she reasonably believed to be in, or not opposed to, the best interests of the
corporation and, with respect to a criminal proceeding, such agent has no cause
to believe his or her conduct was unlawful. Subsection 14A:3-5(3) of the BCA
provides for similar indemnification of a corporate agent in a proceeding by,
or in the right of, the corporation, but requires court approval of the actual
indemnification. Subsections 14A:3-5(5) through Subsection 14A:3(5)(12) of the
BCA further define the procedures relating to indemnification.
See the last undertaking in Item 17 to this Registration Statement.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not applicable.
ITEM 8. EXHIBITS
All of the following exhibits except those designated with an asterisk are
incorporated herein by reference to a prior registration statement filed under
the Securities Act or a periodic report filed by the Registrant pursuant to
Section 13 or 15(d) of the Exchange Act. Those exhibits designated with an
asterisk are filed as an exhibit to this Registration Statement.
Number Exhibits
- ------ --------
3(a) Copy of Articles of Incorporation of the Registrant.(1)
10
<PAGE> 12
3(a)(1) Copy of Amendment to Articles of Incorporation of the Registrant filed
on December 30, 1988.(1)
3(a)(2) Copy of Amendment to Articles of Incorporation of the Registrant filed
on September 12, 1991.(2)
3(a)(3) Copy of Certificate of Designations and Preferences of the Series A
Preferred Stock of the Registrant filed on September 12, 1991.(2)
3(a)(4) Copy of Amendment to the Articles of Incorporation of the Registrant
filed on May 22, 1992.(2)
3(a)(5) Copy of Amendment to the Articles of Incorporation of the Registrant
filed on June 23, 1992.(2)
3(a)(6) Copy of Amendment to the Articles of Incorporation of the Registrant
filed on August 25, 1993.(2)
3(a)(7) Copy of Amendment to the Articles of Incorporation of the Registrant
filed on January 26, 1994.(3)
3(b) Copy of Amended and Restated By-Laws of the Registrant as adopted by
shareholders on January 12, 1994.(3)
4(a) Specimen of Common Stock Certificate after one- for-four reverse stock
split effective January 26, 1994.(3)
- ---------------
(1) Filed as an exhibit to the Registrant's Registration Statement on Form
S-8, File No. 33-27027, and incorporated herein by this reference.
(2) Filed as an exhibit to the Registrant's Annual Report on Form 10-KSB for
the year ended May 31, 1993 and incorporated herein by this reference.
(3) Filed as an exhibit to the Registrant's Quarterly Report on Form 10-QSB
for the quarter ended February 28, 1994 and incorporated herein by this
reference.
Number Exhibits
- ------ --------
*4(b) Copy of Consulting Agreement dated as of April 16, 1996 by and between
the Registrant and Lee S. Rosen.
11
<PAGE> 13
*4(b)(1) Form of Common Stock Purchase Warrant expiring April 15, 1999 issued
by the Registrant to Lee S. Rosen.
*5 Opinion of Gold & Wachtel, LLP.
*23(a) Consent of Gold & Wachtel, LLP (included in Opinion filed as Exhibit
5).
*23(b) Consent of BDO Seidman, LLP.
*23(c) Consent of Ernst & Young LLP.
ITEM 17. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
1. To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act.
(ii) To reflect in the prospectus any facts or events arising after the
effective date of the Registration Statement (or the most recent post-effective
amendment thereof) which, individually or in the aggregate, represent a
fundamental change in the information set forth in the Registration Statement;
and
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or any
material change to such information in the registration statement.
2. That, for the purpose of determining any liability under the Securities
Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
3. To remove from registration by means of a post- effective amendment any
of the securities being registered which remain unsold at the termination of
the offering.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) of the Exchange Act that
is incorporated by reference in the Registration Statement shall be deemed to
be a new registration statement relating to the securities offered
12
<PAGE> 14
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
The undersigned Registrant hereby undertakes to deliver or cause to be
delivered with the Prospectus, to each person to whom the Prospectus is sent or
given, the latest annual report, to security holders that is incorporated by
reference in the Prospectus and furnished pursuant to and meeting the
requirements of Rule 14a-3 or Rule 14c-3 under the Exchange Act; and, where
interim financial information required to be presented by Article 3 of
Regulation S-X is not set forth in the prospectus, to deliver, or cause to be
delivered to each person to whom the prospectus is sent or given, the latest
quarterly report that is specifically incorporated by reference in the
Prospectus to provide such interim financial information.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by
such director, officer or controlling person in connection with the securities
being registered, the Registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act and will be governed
by the final adjudication of such issue.
13
<PAGE> 15
SIGNATURES
Pursuant to 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 S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of New York, State of New York, on June 7, 1996.
CREATIVE LEARNING PRODUCTS, INC.
(Registrant)
By: /s/ Peter J. Jegou
---------------------------
Peter J. Jegou
Chairman, President and
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities indicated on June 7, 1996.
Signature Title
- --------- -----
/s/ Peter J. Jegou Principal Executive Officer and
- ------------------------- Director
Peter J. Jegou
/s/ Walter J. Krzanowski Principal Financial and
- ------------------------- Accounting Officer
Walter J. Krzanowski
/s/ Carol A. Kulina-Jegou Director
- -------------------------
Carol A. Kulina-Jegou
14
<PAGE> 16
E X H I B I T S
<PAGE> 17
EXHIBIT INDEX
Number Exhibit
- ------ -------
4(b) Copy of Consulting Agreement dated as of April 16, 1996 by and between
the Registrant and Lee S. Rosen
4(b)(1) Copy of Warrant Agreement dated between Lee S. Rosen and the Registrant
5(a) Opinion of Gold and Wachtel, LLP
23(a) Consent of Gold & Wachtel, LLP is included in their opinion filed as
Exhibit 5 hereto
23(b) Consent of BDO Seidman, LLP
23(c) Consent of Ernst & Young, LLP
<PAGE> 1
CONSULTING AGREEMENT
AGREEMENT made as of this 16th day of April, 1996 by and between Creative
Learning Products, Inc., a New Jersey corporation ("CLPI"), and Lee Rosen (the
"Consultant").
WHEREAS, CLPI's Common Stock, no par value (the "Common Stock"), is traded
on the National Association of Securities Dealers Automated Quotation
("NASDAQ") System;
WHEREAS, the Consultant is engaged in the business of providing consulting
services with respect to financial public relations and invest relations; and
WHEREAS, CLPI desires to engage the Consultant to provide financial public
relations services and investor relations services for CLPI, and CLPI is
willing to render such services, on the terms and conditions as hereinafter
more fully set forth.
NOW, THEREFORE, the parties hereto, intending to be legally bound, agree
as follows:
1. CLPI hereby engages and retains the Consultant, and the Consultant
hereby accepts such engagement and retention, to render to CLPI the consulting
services hereinafter described in Section 2 hereof for a period commencing on
the date hereof and
<PAGE> 2
terminating April 15, 1998 (the "Term"), unless terminated sooner as
provided in Section 6 hereof.
2. The Consultant's services hereunder shall consist of consultations with
the officers and directors of CLPI with respect to CLPI's relationships with
its shareholders, potential investors in CLPI and industry securities analysts,
as CLPI may from time to time reasonably request during the Term, but not with
respect to the offer or sale of securities in a capital raising transaction.
The services to be rendered by the Consultant shall include, but not be limited
to, coordinating and arranging "road shows" or individual meetings at
which representatives of CLPI shall meet with its shareholders, potential
investors in CLPI and industry securities analysts; and assisting in the
dissemination of appropriate information with respect to CLPI and its
subsidiaries.
3. In full consideration for the services to be rendered by the Consultant
to CLPI, CLPI shall (a) pay to the Consultant a fee of $133,333, said fee to be
payable at anytime during the period between the date hereof and September 30,
1996 at the discretion of CLPI, but not later than the date on which, on a
cumulative basis, CLPI has received at least $3,000,000 in gross proceeds from
third party financings after the date hereof; and (b) issue to the Consultant a
warrant (the "Warrant") to purchase
2
<PAGE> 3
1,000,000 shares of the Common Stock at an exercise price of $.75 per share.
CLPI shall register the Warrant and the shares of the Common Stock underlying
the Warrant (the "Underlying Shares") under the Securities Act Form S-8. The
Consultant represents and warrants that he is acquiring the Warrant and, if the
Underlying Shares are issued to him before such time as the Underlying Shares
are so registered under the Securities Act, the Underlying Shares for
investment purposes only, and not with a view to, or in connection with the
resale or distribution thereof. CLPI represents that, upon issuance, the
Underlying Shares shall be fully paid and non-assessable and shall be free and
clear of all security interests, liens and encumbrances arising from acts of
CLPI. The Warrant and/or the Underlying Shares shall not be subject to
termination or forfeiture upon termination of this Agreement under Section 6
thereof, except that CLPI may prorate the number of shares of the Underlying
Shares if CLPI terminates this Agreement for Cause under Section 6 thereof.
The number of shares of the Underlying Shares as to which the Warrant may be
exercised after any such termination by CLPI shall be the product of 1,000,000
and a fraction, the numerator of which shall be the number of days of the Term
which have elapsed prior to the effective date of termination and the
denominator of which shall be 730.
3
<PAGE> 4
4. The Consultant shall be entitled to reimbursement by CLPI for such
reasonable out-of-pocket expenses as the Consultant may incur in performing
services under this Agreement and for which he furnishes appropriate
documentation to CLPI in accordance with the regulations of the Internal
Revenue Service and the policies of CLPI.
5. All final decisions with respect to actions to be taken by CLPI based
upon the Consultant's advice shall be those of CLPI.
6. This Agreement shall terminate prior to the expiration of the Term upon
the earliest of the events specified below:
a. by CLPI, upon notice to the Consultant, for Cause, which
shall be defined, for purposes of this subsection (a), as the Consultant (i)
being convicted of a felony under the laws of any state or the United States,
whether directed toward CLPI or its subsidiaries or otherwise, or (ii)
committing larceny, embezzlement or other act of fraud or dishonesty against
CLPI or its subsidiaries, or (ii) using CLPI's or its subsidiaries' facilities
or premises for the conduct of illegal or unlawful activities, transactions or
businesses; or
b. by either party, upon notice to the other, for Cause, which
shall be defined for purposes of this subsection (b) as the other party's
material breach of any of its or his
4
<PAGE> 5
covenants and agreements hereunder and the failure to cure such breach within
30 days after notice thereof.
7. This Agreement shall be governed by, and construed in accordance with,
the laws of the State of New York, without giving effect to any principles of
conflict of laws. Any controversy or claim arising out of, or relating to,
this Agreement, or the breach thereof, shall be settled by arbitration in New
York, New York in accordance with the Rules of the American Arbitration
Association, and judgment upon the award rendered by the Arbitrator(s) may be
entered in any court having jurisdiction thereof. The parties hereto consent
to the personal jurisdiction of the Federal and State courts located in the
County of New York, State of New York.
8. This Agreement may not be, and shall not be deemed or construed to have
been, modified, amended, rescinded, canceled or waived in whole or in part,
except by written instruments signed by the parties hereto.
9. Any and all notices or other communications or deliveries required or
permitted to be given or made shall be in writing and delivered personally, or
sent by certified or registered mail, return receipt requested and postage
prepaid, or sent by overnight courier service as follows:
5
<PAGE> 6
If to CLPI, at:
150 Morris Avenue, Suite 205
Springfield, NJ 07081
Attention: Mr. Peter J. Jegou,
Chairman, President and Chief Executive Officer
With a copy to:
Gold & Wachtel, LLP
110 East 59th Street
New York, New York 10022
Attention: Robert W. Berend, Esq.
If to the Consultant, at:
17332 Saint James Court
Boca Raton, FL 33496
or at such other address as any party may specify by notice given to such other
party in accordance with this Section 9. The date of giving of any such notice
shall be the date of hand delivery, two (2) days after the date of the posting
of the mail or the date when deposited with the overnight courier.
10. Each party will be and act as an independent contractor and not as
agent or partner of, or joint venturer with, the other party for any purpose,
and no party by virtue of this Agreement
6
<PAGE> 7
shall have any right, power or authority to act or create any obligation,
express or implied, on behalf of the other parties.
11. No waiver of the provisions hereof shall be effective unless in
writing and signed by the party to be charged with such waiver. No waiver
shall be deemed a continuing waiver or waiver in respect of any subsequent
breach or default, either of similar or different nature, unless expressly so
stated in writing.
12. This Agreement shall inure to the benefit of, be enforceable by, and
shall be binding upon the parties and their respective legal representatives,
successors and assigns.
IN WITNESS WHEREOF, the parties hereto have respectively executed this
Agreement as of the day and year first above written.
CREATIVE LEARNING PRODUCTS, INC.
By:
--------------------------------
Chairman, President and
Chief Executive Officer
--------------------------------
LEE ROSEN
7
<PAGE> 1
NEITHER THIS WARRANT NOR THE SECURITIES ISSUABLE
UPON EXERCISE HEREOF HAVE BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR UNDER ANY
STATE SECURITIES LAWS AND MAY NOT BE TRANSFERRED IN
VIOLATION OF SUCH ACT OR LAWS, THE RULES AND
REGULATIONS THEREUNDER AND THE PROVISIONS
OF THIS WARRANT.
WARRANT TO PURCHASE 1,000,000 SHARES
OF COMMON STOCK OF
CREATIVE LEARNING PRODUCTS, INC.
ISSUED TO
LEE S. ROSEN
DATED: APRIL 16, 1996
WARRANT NO. ____
(INCORPORATED UNDER THE LAWS OF THE STATE OF NEW JERSEY)
THIS CERTIFIES THAT LEE S. ROSEN (the "Warrant Holder") is the owner
of a Warrant, subject to adjustment as provided in Section 3 hereof, which
entitles the owner thereof to purchase, in whole or in part at any time, and
from time to time, during the period commencing on April 16, 1996 (the
"Commencement Date") and terminating at 5:00 P.M., New York Time, on April 15,
1999 (the "Expiration Date"), 1,000,000 fully paid and nonassessable shares of
the Common Stock, no par value (the "Common Stock"), of Creative Learning
Products, Inc., a New Jersey corporation (hereinafter called the "Company"), at
the purchase price per share of $0.75 (the "Purchase Price"), subject to
adjustment as provided in Section 3 hereof, payable in lawful money of the
United States of America upon surrender of this Warrant and payment of the
Purchase Price in lawful money of the United States of America at the principal
office of the Company (currently 150 Morris Avenue, Springfield, New Jersey
07081) or at such other place as the Company may designate by written notice to
the Warrant Holder.
1. Exercise
The Warrant evidenced hereby may be exercised from time to time, in
whole or in part, from the Commencement Date until the Expiration Date,
provided that in no event may any fractional share of the Common Stock be
issued. In the event that a fractional share would otherwise be issued as a
result of any adjustment made pursuant to Section 3 hereof or otherwise,
payment for such fractional share shall be made on the basis of the Market
Price on
<PAGE> 2
the date of exercise. For the purpose of this Section 1, the term "Market
Price" shall mean (a) if the Common Stock is traded on a national securities
exchange or on the National Association of Securities Dealers Automated
Quotation ("NASDAQ") System, the closing sales price (or, if no sales on that
day, the high bid price) or (b) if the Common Stock is not traded as provided
in subsection (a), the closing bid price as reported in the OTC Bulletin Board
of the National Association of Securities Dealers, Inc. (the "NASD") or in the
pink sheets by the National Quotation Bureau, Inc.
Upon any exercise of the Warrant evidenced hereby, the form of
election to purchase set forth as Exhibit A hereto shall be properly completed,
executed and delivered to the Company, together with full payment to the
Company of the Purchase Price for the shares as to which the Warrant is
exercised by certified check or bank draft. In the event that there is only a
partial exercise of the Warrant evidenced hereby, there shall be issued to the
Warrant Holder a new Warrant Certificate, in all respects similar to this
Warrant Certificate, evidencing the number of shares of the Common Stock still
available for exercise.
Upon receipt of full payment and properly completed documentation, the
Company shall then cause the Transfer Agent for the Common Stock to issue fully
paid and nonassessable shares of the Common Stock as are represented by the
exercise.
If this Warrant shall be surrendered upon exercise within any period
during which the transfer books for the Common Stock are closed for any
purpose, the Company shall not be required to make delivery of certificates for
shares of the Common Stock until the date of the reopening of said transfer
books.
2. Expiration Date
The Warrant evidenced hereby may not be exercised before the
Commencement Date or after the Expiration Date with respect to the shares of
the Common Stock as to which the Warrant may be exercised and, to the extent
not exercised by the Expiration Date, the Warrant evidenced hereby shall become
void.
3. Adjustments
Subject to the provisions of this Section 3, the Purchase Price and
the shares of the Common Stock as to which the Warrant may be exercised shall
be subject to adjustment from time to time as hereinafter set forth:
(a) If at any time, or from time to time, the Company
shall, by subdivision, consolidation, or reclassification of shares, or
otherwise, change as a whole the outstanding shares of the Common Stock into a
different number or class of shares, the number and class of shares so changed
shall replace the shares outstanding immediately prior to such change and the
Purchase Price
<PAGE> 3
and the number of shares purchasable under the Warrant immediately prior to the
date on which such change shall become effective shall be proportionately
adjusted.
(b) Irrespective of any adjustments or change in the
Purchase Price or the number of securities actually purchasable under the
Warrant, the Warrant theretofore and thereafter issued may continue to express
the exercise price and the number of securities purchasable thereunder as the
Purchase Price and the number of securities purchasable were expressed in the
Warrant when initially issued.
(c) If at any time while the Warrant is outstanding, the
Company shall consolidate with, or merge into, another corporation, firm or
entity, or otherwise enter into a form of business combination, the holder of
the Warrant shall thereafter be entitled upon exercise thereof to purchase,
with respect to each security purchasable thereunder immediately prior to the
date on which such consolidation or merger or other form of business
combination shall become effective, the securities or property to which a
holder of one such security would have been entitled upon such consolidation or
merger or other form of business combination, without any change in, or payment
in addition to, the Purchase Price in effect immediately prior to such
consolidation or merger or other form of business combination, and the Company
shall take such steps in connection with such consolidation or merger or other
form of business combination as may be necessary to assure that all the
provisions of the Warrant shall thereafter be applicable, as nearly as
reasonably may be, in relation to any securities or property thereafter
deliverable upon the exercise of the Warrant.
(d) The Board of Directors of the Company, in its
discretion, may, at any time during the exercise period of the Warrant, extend
the exercise period or reduce the Purchase Price for all warrants then
outstanding.
(e) Upon the happening of any event requiring the
adjustment of the exercise price hereunder, the Company shall forthwith give
written notice thereof to the registered holder of the Warrant stating the
adjusted Purchase Price and the adjusted number of securities purchasable upon
the exercise thereof resulting from such event and setting forth in reasonable
detail the method of calculation and the facts upon which such calculation is
based. The certificate of the Company's independent public accountants shall
be conclusive evidence of the correctness of any computation made hereunder.
4. Notice to Warrant Holder
Nothing contained herein shall be construed as conferring upon the
Warrant Holder the right to vote or to consent or to receive notice as a
shareholder in respect of the meetings of shareholders for the election of
directors of the Company or any other matter, or any other rights whatsoever as
a shareholder of the Company;
<PAGE> 4
provided, however, that in the event that:
(a) the Company shall take action to make any
distribution (other than cash dividends payable out of earnings or earned
surplus) on the Common Stock;
(b) the Company shall take action to offer for
subscription pro rata to the holders of the Common Stock any additional shares
of stock of any class or other rights or securities convertible into the Common
Stock;
(c) the Company shall take action to accomplish any
capital reorganization, or reclassification of the capital stock of the Company
(other than a change in par value, or a change from par value to no par value,
or a change from no par value to par value, or a subdivision or combination of
the Common Stock), or a consolidation or merger of the Company into, or a sale
of all or substantially all of its assets to, another corporation; or
(d) the Company shall take action looking to a voluntary
dissolution, liquidation or winding up of the Company;
then, in any one or more of such cases, the Company shall, (x) at least 10 days
prior to the date on which the books of the Company shall close or a record
date shall be taken for such distribution or subscription rights or for
determining rights to vote in respect of any such reorganization,
reclassification, consolidation, merger, sale, dissolution, liquidation or
winding up, cause notice thereof to be sent to the Warrant Holder at the
address appearing on the Warrant register of the Company and, (y) in the case
of any such reorganization, reclassification, consolidation, merger, sale,
dissolution, liquidation or winding up, cause at least 10 days' prior written
notice of the date when the same shall take place to be given to the Warrant
Holder in the same manner. Such notice in accordance with the foregoing clause
(x) shall also specify, in the case of any such distribution or subscription
rights, the date on which the holders of the Common Stock shall be entitled
thereto, and such notice in accordance with the foregoing clause (y) shall also
specify the date on which the holders of the Common Stock shall be entitled to
exchange their shares of the Common Stock for securities or other property
deliverable upon such reorganization, reclassification, consolidation, merger,
sale, dissolution, liquidation or winding up, as the case may be. Failure to
give such notice or any defect therein shall not affect the legality or
validity of any of the matters set forth in this Section 5 inclusive.
5. Investment Representation
The Warrant Holder, by his, her or its acceptance of this Warrant,
acknowledges that neither the Warrant nor the shares of the Common Stock
issuable upon exercise thereof have been registered under the Securities Act of
1933, as amended (the "Securities Act"), and, accordingly, represents and
warrants to the
<PAGE> 5
Company that he, she or it is acquiring the Warrant for investment and not with
a view to, or in connection with, any distribution thereof. The holder further
represents and warrants that, if a registration statement under the Securities
Act is not effective with respect to the underlying shares at the time of
exercise, the Warrant Holder will acquire the shares of the Common Stock for
investment and not with a view to, or in connection with, any distribution
thereof.
6. Transfers and Exchanges
The Company shall transfer, from time to time, any outstanding Warrant
upon the books to be maintained by the Company for that purpose, upon surrender
thereof for transfer properly endorsed or accompanied by appropriate
instructions for transfer. Upon any such transfer, a new Warrant shall be
issued to the transferee and the surrendered Warrant shall be canceled by the
Company. The Warrant so canceled shall be delivered to the Company from time
to time upon request. Warrants may be exchanged at the option of the holder
thereof, when surrendered at the office of the Company, for another Warrant, or
other Warrants of different denominations, of like tenor and representing in
the aggregate the rights to purchase a like number of shares. Anything in this
Section 6 to the contrary notwithstanding, no transfer shall be made if such
transfer would violate Section 5 of the Securities Act.
7. Payment of Taxes
The Company will pay any documentary stamp taxes attributable to the
initial issuance of the Common Stock issuable upon the exercise of the Warrant;
provided, however, that the Company shall not be required to pay any tax or
taxes which may be payable in respect of any transfer involved in the issue or
delivery of any certificates for the Common Stock in a name other than that of
the registered holder of the Warrant in respect of which such shares are
issued, and in such case the Company shall not be required to issue or deliver
any certificates for the Common Stock or any Warrant for remaining shares until
the person requesting the same has paid to the Company the amount of such tax
or has established to the Company's satisfaction that such tax has been paid.
8. Mutilated or Missing Warrant
In case the Warrant shall be mutilated, lost, stolen or destroyed, the
Company may in its discretion issue and deliver in exchange and substitution
for, and upon cancellation of, the mutilated Warrant, or in lieu of, and in
substitution for, the Warrant lost, stolen or destroyed, a new Warrant of like
tenor and representing an equivalent right or interest, but only upon receipt
of evidence satisfactory to the Company of such loss, theft or destruction of
such Warrant. Applicants for such substitute Warrant shall also comply with
such other reasonable regulations and pay such reasonable charges as the
Company may prescribe.
<PAGE> 6
9. Reserve
The Company covenants and agrees that, from time to time, there will
be authorized and available for delivery a sufficient number of its shares of
the Common Stock or other securities into which the Warrant is then exercisable
to permit the exercise of the Warrant at the time outstanding as and when the
certificates shall, from time to time, be deliverable in accordance with
Section 1 hereof. In the event that there are insufficient shares or other
securities for such purpose, the Company shall use its best efforts to seek
shareholder approval for an Amendment to the Company's Certificate of
Incorporation and/or to take such other action as is necessary or appropriate
to cause such shares or other securities to be authorized.
10. Governing Law
The Warrant evidenced hereby shall be construed and enforced in
accordance with the laws of the State of New Jersey applicable to contracts
made and to be performed in that State, without giving effect to any principles
of conflicts of laws.
IN WITNESS WHEREOF, Creative Learning Products, Inc. has caused this
Warrant to be signed manually by a duly authorized officer.
Dated: April 16, 1996 CREATIVE LEARNING PRODUCTS, INC.
By:
---------------------------------
Peter J. Jegou, President
<PAGE> 7
EXHIBIT A
ELECTION TO PURCHASE
To Creative Learning Products, Inc.
c/o
-----------------------------------
-----------------------------------
-----------------------------------
The undersigned hereby irrevocably elects to exercise the Warrant
represented by the within Warrant Certificate to purchase shares of the
Common Stock issuable upon the exercise of the Warrant and requests that
certificates for such shares shall be issued in the name of
- -------------------------------------------------------------------------------
(Name)
- -------------------------------------------------------------------------------
(Address)
- -------------------------------------------------------------------------------
(Taxpayer number)
and be delivered to
------------------------------------------------------------
(Name)
at
-----------------------------------------------------------------------------
(Address)
and, if said number of shares of the Common Stock shall not be all the shares
of the Common Stock evidenced by the within Warrant Certificate, that a new
Warrant Certificate for the balance remaining of such said shares be registered
in the name of
- -------------------------------------------------------------------------------
(Name)
- -------------------------------------------------------------------------------
(Address)
- -------------------------------------------------------------------------------
(Taxpayer number)
and delivered to the undersigned at the address below stated.
Dated: , 19
---------------- --
<PAGE> 8
Name of holder of Warrant Certificate:
- -------------------------------------------------------------------------------
(please print)
- -------------------------------------------------------------------------------
(Address)
- -------------------------------------------------------------------------------
(Signature)
Note: The above signature must correspond
with the name as written upon the
face of this Warrant Certificate in
every particular, without alteration
or enlargement or any change
whatever.
<PAGE> 1
Exhibit 5
GOLD & WACHTEL, LLP
110 East 59th Street
New York, New York 10022
June 6, 1996
Creative Learning Products, Inc.
150 Morris Avenue
Suite 205
Springfield, New Jersey 07081
Dear Sirs:
We refer to the Registration Statement on Form S-8 (the "Registration
Statement") to be filed by Creative Learning Products, Inc. (the "Company")
under the Securities Act of 1933, as amended, relating to 1,000,000 shares of
the Common Stock, no par value per share (the "Common Stock"), of the Company
issuable upon the exercise of a warrant (the "Warrant") granted pursuant to the
terms of a written consulting agreement dated as of April 16, 1996 by and
between the Company and Lee S. Rosen (the "Agreement").
As counsel to the Company, we have examined the Certificate of
Incorporation of the Company, its By-laws, its minutes, the Warrant, the
Agreement and other corporate proceedings relating to the authorization and
issuance of the aforesaid shares of the Common Stock and have reviewed the
Registration Statement in the form intended to be filed. In our opinion, we
have made such an investigation and examination as we have deemed necessary for
the purposes of expressing an informed opinion on the matters hereafter
discussed.
Based upon such examination, it is our opinion that:
1. The Company is duly organized and validly existing under the
laws of the State of New Jersey; and
2. The 1,000,000 shares of the Common Stock to be issued upon
exercise of the Warrant will, upon issuance pursuant to exercise of the Warrant
in accordance with the terms of the Warrant and the Agreement, be validly
issued, fully paid and non-assessable.
<PAGE> 2
Creative Learning Products, Inc.
June 6, 1996
Page 2
In addition, we hereby consent to the filing of this opinion as an
Exhibit to said Registration Statement and to the reference to our firm on page
9 of the Prospectus included in the Registration Statement.
Very truly yours,
/s/ GOLD & WACHTEL, LLP
<PAGE> 1
CONSENT OF INDEPENDENT
CERTIFIED PUBLIC ACCOUNTANTS
Creative Learning Products, Inc.
Springfield, New Jersey
We hereby consent to the incorporation by reference in the Prospectus
constituting a part of this Registration Statement of our report dated
September 29, 1995, except for Note 1 which is as of October 6, 1995, relating
to the consolidated financial statements of Creative Learning Products, Inc.
appearing in the Company's Annual Report on Form 10-KSB for the year ended May
31, 1995.
We also consent to the reference to us under the caption "Experts" in the
Prospectus.
/s/ BDO SEIDMAN, LLP
BDO Seidman, LLP
New York, New York
June 4, 1996
<PAGE> 1
EXHIBIT 23(c)
Consent of Independent Auditors
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-8 No. 33-00000) pertaining to the Consulting
Agreement dated as of April 16, 1996 by and between Creative Learning Products,
Inc. and Lee Rosen and to the incorporation by reference therein of our report
dated October 28, 1994, with respect to the consolidated financial statements
of Creative Learning Products, Inc. included in its Annual Report (form 10-KSB)
for the year ended May 31, 1995, filed with the Securities and Exchange
Commission.
/s/ ERNST & YOUNG LLP
Princeton, New Jersey
June 5, 1996
