As filed with the Securities and Exchange Commission on September 10, 1999
Registration No.:
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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CREATIVE BAKERIES, INC.
(Exact name of registrant as specified in its charter)
New York 13-3832215
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
20 Passaic Avenue
Fairfield, New Jersey 07004
(973) 808-8248
(Address, including zip code, and telephone number,
including area code of Registrant's principal executive offices)
PHILIP GRABOW
President and Chief Executive Officer
Creative Bakeries, Inc.
20 Passaic Avenue
Fairfield, New Jersey 07004
(973) 808-8248
(Name, address, including zip code and telephone number,
including area code, of agent for service)
Copy To:
Richard S. Frazer, Esq.
Pryor Cashman Sherman & Flynn LLP
410 Park Avenue
New York, New York 10022
(212) 421-4100
Approximate date of commencement of proposed sale of the securities to the
public: As soon as possible after this Registration Statement becomes effective.
<PAGE>
If the only securities being registered on this Form are to be offered
pursuant to dividend or interest reinvestment plans, please check the following
box. |_|
If any of the securities being registered on this Form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, other than securities offered only in connection with dividend or
interest reinvestment plans, please check the following box. |X|
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act of 1933, 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 of 1933, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. |_|
If delivery of the Prospectus is expected to be made pursuant to Rule 434,
check the following box. |_|
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Calculation Of Registration Fee
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<CAPTION>
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Proposed Proposed
Maximum Maximum
Offering Aggregate
Title of Each Class of Amount to Price Per Offering Amount of
Securities to be Registered be Registered Share* Price* Registration Fee
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<S> <C> <C> <C> <C>
Common Stock, $.001 par
value ...................... 891,250 shares $0.44 $392,150.00 $200.00
==================================================================================
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* Calculated in accordance with Rule 457(c) solely for the purpose of
calculating the registration fee (based on the average of the bid and
asked price of our common stock as quoted on the NASD OTC Bulletin Board
on September 3, 1999.)
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 this Registration Statement shall become
effective on such date as the Securities and Exchange Commission, acting
pursuant to said Section 8(a), may determine.
<PAGE>
PROSPECTUS
891,250 Shares
CREATIVE BAKERIES, INC.
Common Stock
(Par value $.001 Per Share)
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The shareholders listed in this prospectus are offering and selling up to
891,250 shares of common stock of Creative Bakeries, Inc. We will not receive
any proceeds from such sale.
Our common stock is quoted on the NASD OTC Bulletin Board under the symbol
"CBAK." The last reported bid price for the common stock on September 3, 1999,
was $0.38 per share (rounded to the nearest cent). The last reported ask price
for the common stock on such date was $0.50 per share.
The selling shareholders may offer their shares of common stock through
public or private transactions in the over-the-counter markets, on or off the
United States exchanges, at prevailing market prices or at privately negotiated
prices. The selling shareholders may engage brokers or dealers who may receive
commissions or discounts from the selling shareholders.
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See "Risk Factors" at page 5 of this prospectus for a discussion of
certain material factors which you should consider before investing in the
common stock offered by this prospectus.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
adequacy or accuracy of this prospectus. Any representation to the contrary is a
criminal offense.
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The date of this Prospectus is September _, 1999.
<PAGE>
This prospectus is part of a registration statement we filed with the SEC.
You should rely only on the information provided or incorporated by reference in
this prospectus or any related supplement. We are not offering to sell or buy
the common stock offered in this document to any person unauthorized or
prohibited to do so. The selling shareholders will not make an offer of these
shares in any state where the offer is not permitted. You should not assume that
the information in this prospectus or any supplement is accurate as of any date
other than the date on the front of those documents.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and
other information with the Securities Exchange Commission (the "SEC"). You may
read and copy any document we file at the SEC's public reference room located
450 Fifth Street, N.W., Washington, D.C. 20549. Please call the SEC at
1-800-SEC-0330 for further information on the operation of such public reference
room. You may also request copies of such documents, upon payment of a
duplicating fee, by writing to the SEC at 450 Fifth Street, N.W., Washington,
D.C. 20549 or obtain copies of such documents from the SEC's web site at
http://www.sec.gov.
INCORPORATION BY REFERENCE
The SEC allows us to "incorporate by reference" the information we file
with them, which means that we can disclose important information to you by
referring you to those documents. The information we incorporate by reference is
considered to be part of this prospectus and information that we file later with
the SEC will automatically update and supersede this information. We incorporate
by reference the documents listed below and any future filings we make with the
SEC under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of
1934, as amended:
(1) Annual Report on Form 10-KSB for the fiscal year ended December 31,
1998; and
(2) Quarterly Report on Form 10-QSB for the fiscal quarter ended March
31, 1999;
(3) Quarterly Report on Form 10-QSB for the fiscal quarter ended June
30, 1999;
You may request a copy of these filings (excluding exhibits to such
filings that we have not specifically incorporated by reference in such
filings), at no cost, by writing or telephoning us at the following address:
Creative Bakeries, Inc.
20 Passaic Avenue
Fairfield, New Jersey 07004
Attn: Mr. Philip Grabow, President
(973) 808-8248
The following discussion and analysis contains forward-looking statements.
Such statements generally discuss future expectations. You can identify such
statements by the use of forward looking terminology as "may," "will," "expect,"
"anticipate" or other similar words.
<PAGE>
You should be aware that any such forward-looking statements are not guarantees
of future performance and involve risks and uncertainties. Actual results may
differ materially from those in the forward-looking statements as a result of
various factors. Factors that might cause such a difference include, among
others, general economic and business conditions. See "Risk Factors."
ABOUT THE COMPANY
We, Creative Bakeries, Inc., through our two operating subsidiaries,
WGJ Desserts and Cafes, Inc. (the "WGJ Subsidiary") and Batter Bake-Chatterley
Inc. (the "BBC Subsidiary"), offer a broad line of premium quality pastries,
cakes, pies, cookies and other assorted desserts which are produced at our
baking facility. We market and distribute our baked goods on a wholesale basis
to supermarkets, restaurants and institutional dining facilities as well as by
mail order. Recently, we completed a corporate restructuring pursuant to which
we closed down our William Greenberg retail operations while consolidating into
the BBC Subsidiary the wholesale operations of JMS Specialities, Inc. ("JMS"),
which we acquired in January 1997, and Chatterley Elegant Desserts, Inc.
("Chatterley") which we acquired in August 1997. We continue to seek potential
acquisition or merger candidates to expand our existing product offerings and
geographic markets. However, we can offer no assurance that we will be able to
identify successfully such candidates on terms acceptable to us or at all.
Our Business Strategy
Retail. After carefully analyzing our retail operations, we concluded that
the William Greenberg stores we had recently opened were not generating the
sales revenue required to become profitable and that the resources required to
increase our retail sales would be better used to expand our wholesale division.
Therefore, we closed down all our of retail stores.
Institutional/Wholesale. We plan to increase our penetration in the
institutional/wholesale food market by expanding our marketing efforts to
restaurants, hotels and corporate dining facilities and by offering our products
to supermarkets on a national basis. We plan to expand both our product line and
geographic distribution through the following strategies:
o Expand geographic distribution by acquiring new food distributors in
the Connecticut and Philadelphia areas as well as key distributor
areas throughout the United States. To do this, we intend to appoint
food brokers in various states to handle sales on a commission-only
basis.
o Continue to expand the fat-free product line targeting existing
customers as well as new customers; and
o Enter into co-packing arrangements whereby we introduce private
label products of other bakery operations.
Mail Order. Our WGJ Subsidiary is offering its products through other
specialty food retailers and through its mail order catalogue business. Mail
order sales accounted for approximately 1% of total sales for each fiscal year
ended December 31, 1998, 1997 and 1996, respectively.
Kosher Foods. We are also seeking to benefit from the growth of the kosher
food
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industry. According to Prepared Foods, the kosher food industry generated
approximately $33 billion in sales in 1994 and has been growing at a rate of
approximately 15% per annum. The WGJ Subsidiary and the BBC Subsidiary each have
a kosher certification and we believe that we can benefit from the projected
growth of this market.
Our Business Philosophy
High Quality Ingredients. We believe that developing and maintaining
premium quality products is the key to our future success. We use fresh
ingredients in our products, including AA creamy butter, fresh eggs, premium
fruits, nuts, and chocolates blended for our unique recipes. We seek to maintain
rigorous standards of freshness, quality and consistency.
Customer Service. Our goal is to provide our customers with warm,
courteous and efficient service. We depend on and enjoy a high rate of repeat
business. We believe that the quality of the relationship between our employees
and our customers is critical to our success. We strive to hire and train
well-qualified, highly motivated employees committed to providing superior
levels of customer service.
Our Products
Baked Goods. Our BBC Subsidiary markets a full line of premium quality
baked products such as cheese cakes, mousse cakes and tart shells. Additionally,
we have expanded our offerings to include a line of frozen batter and baked
products, including a variety of Gourmet Frozen Muffin Batter products, No Sugar
Added Batters, as well as, a selection of Fully Baked Thaw & Sell muffins and
cakes. We continue to develop new products and welcome customer requests.
Kosher Foods. The Kosher Foods industry is a rapidly growing segment of
the prepared foods industry. Both our WGJ Subsidiary and our BBC Subsidiary have
kosher certifications and we believe that we can capitalize on the projected
growth of this market. We believe that our kosher certification will enable us
to better penetrate certain market areas. Our products are not kosher for
Passover.
Customers
Retail. Our WGJ Subsidiary has licensed the "William Greenberg Jr." name
to a retail operator who sells our products directly to individual consumers.
The retailer also sells our specialty desserts to customers for parties,
weddings, bar mitzvahs and other specialty occasions.
Institutional/Wholesale. This market is mainly served through the BBC
Subsidiary. With the acquisition of Chatterley, we now offer our institutional
and wholesale customers an expanded line of baked goods, batter and
frozen-finished cakes, brownies and muffins.
The BBC Subsidiary sells its products through food distributors to hotels,
hospitals and institutional feeders such as coffee shops, Marriott, Restaurants
Associates, etc. The products are also sold retail through food distributors and
direct to supermarket distribution centers.
Mail Order. The WGJ Subsidiary sells select products through mail order.
These products are shipped via overnight delivery and second day delivery
throughout the United States and internationally. We have a toll free number
(800) 564-2470 for our mail order operations.
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Distribution and Marketing
Recently, we decided to close four retail stores operated by our WGJ
Subsidiary in New York City, including the commissary located at Macy's Herald
Square. As an alternative to the operation of retail stores, the WGJ Subsidiary
has licensed its name to an operator who runs retail and wholesale operations.
The BBC Subsidiary bakes all of its products at its 30,000 square foot
facility in Fairfield, New Jersey. Although utilization of the facility varies
based on seasonal fluctuation, the facility is operated on the basis of two
shifts, five days a week. We believe that the BBC Subsidiary has the capacity to
meet future requirements, including those arising out of the consolidation with
Creative Bakeries, Inc. The BBC Subsidiary delivers 90% of its products by truck
to its institutional/wholesale customers. About 10% of its customers pick up
their orders directly at the bakery and utilize their own distribution networks.
Historically, we have relied upon word-of-mouth and customer satisfaction
to market our products to new customers and to make existing customers aware of
new products.
Executive Offices
Creative Bakeries, Inc. was incorporated under the laws of New York in
November 1993. Our executive offices are located at 20 Passaic Avenue,
Fairfield, New Jersey 07004 and our telephone number at that address is (973)
808-8248.
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RISK FACTORS
The purchase of our common stock involves a high degree of risk. You
should carefully consider the following risk factors and other information in
this prospectus before deciding to invest in such stock.
Historical Losses
For the fiscal years ended December 31, 1998 and 1997, we generated
consolidated revenues from continuing operations in the aggregate amount of
$3,814,440.00 and $5,014,558.00, respectively, a decrease of 24%. For the fiscal
years ended December 31, 1998 and 1997, our costs of goods sold were
$3,137,519.00 and $4,224,113.00, respectively, a decrease 26%, due to the
overall decrease in sales. Operating expenses were $1,300, 317.00 and
$1,867,242.00 for 1998 and 1997, respectively, a decrease of 31%, mainly
attributable to the termination of certain management and other personnel. As a
result, the loss from continuing operations was $576,796.00 and $1,464,235.00
for 1998 and 1997 respectively, a decrease of 61%.
In the six months ended June 30, 1999, we generated consolidated revenues
from continuing operations in the aggregate amount of $2,036,252.00. During the
same period last year, our consolidated revenues were $1,959,341.00. Our cost of
goods sold during the first six months of 1999 and 1998 were $1,611,200.00 and
$1,646,774.00, respectively. Our operating expenses also decreased for the same
period from $614,680.00 in 1998 to $529,842.00 in 1999. As a result, our loss
from continuing operations was reduced from $279,801.00 in 1998 to $60,610 in
1999.
Management attributes this positive trend to its overrall restructuring
efforts. Although we anticipate that this positive trend will continue, we can
not offer assurance that we will become profitable or, if we become profitable,
that we will be able to sustain our profitability.
Success of Revised Business Strategy
We intend to re-focus our business strategy on our institutional/wholesale
and mail order operations; and recently, we have closed down all of our retail
operations. Having recently embarked on such strategy, there can be no assurance
that we will successfully implement our strategy or that our strategy will
result in profitability.
Need For Additional Financing; Increase in Operating Costs; Availability of
Supplies.
Although we believe we have adequate capital to fund current operations
for the next 12 months, we may be required to obtain additional financing
earlier in order to continue our operations and expansion strategy. We can offer
no assurances that we will be able to obtain additional funds, or if we are able
to obtain additional funds, such funds will be obtainable on terms or in the
amounts required. If we are not able to raise additional funding, we may be
required to delay, scale back or eliminate some or all of its efforts or other
operations, which will have a material adverse effect on our business, results
of operations and prospects. Any future issuance of our securities will dilute
the common stock of our then existing stockholders, which in certain
circumstances could be substantial.
Currently, we purchase all of our ingredients, such as butter, eggs, sugar
and flour, from three suppliers. The costs of such items, like other
commodities, are subject to fluctuations due to changes in economic conditions,
weather, demand and other factors, many of which are beyond our control.
Historically, we have been able to pass significant price increases through
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to our customers. However, we can offer no assurances that we will be able to do
so in the future. In addition, an increase in coffee prices could have a
material adverse effect on our results of operations. We believe that
alternative sources for our ingredients are readily available and we do not
believe that the loss of any of our current suppliers would have a material
adverse effect on our business, financial condition or results of operations.
Dependence on Key Personnel
We are dependent on the experience, abilities and continued services of
Philip Grabow, our President and Chief Executive Officer. Although we have
entered into an employment agreement with Mr. Grabow, the loss of his services
could have a material adverse effect on our business, financial condition or
results of operations.
Control of Company by Management
Philip Grabow and Yona Gonen (formerly Abrahami), Chief Operating Officer
of Chatterley, own an aggregate of 1,000,000 shares of common stock,
representing approximately 19% of the issued and outstanding shares of common
stock. Accordingly, Mr. Grabow and Ms. Gonen will be able to effectively control
the election of our Board of Directors and in general to effectively determine
the outcome of any corporation transaction or other matters submitted to our
shareholders for approval including mergers, acquisitions, consolidations or the
sale of all or substantially all of our assets. See "Description of Securities."
Potential Liability; Availability of Insurance
From time to time, we are subject to lawsuits as a result of our business;
and currently, we maintain insurance relating to personal injury and product
liability in amounts that we consider adequate and customary for the food
industry. While we have been able to obtain such insurance in the past, no
assurances can be given that we will be able to maintain these insurance
policies in the future. In addition, any successful claim against us, in an
amount exceeding our insurance coverage, could have a material adverse effect on
our business, financial condition or results of operations.
Risks of Acquisition Strategy
We intend to develop and expand our business. Among the risks associated
with such strategy, which could materially adversely affect our business,
financial condition, results of operations and profitability, are the following:
o we may not be able to identify, acquire or profitably manage
such additional businesses;
o we may incur substantial costs, delays or other operational or
financial problems in integrating acquired businesses;
o such acquisitions may adversely affect our operating results;
o such acquisitions may divert management's attention;
o we may not be able to retain acquired key personnel;
o we may encounter unanticipated events, circumstances or legal
liabilities; and
o the value of acquired intangible assets could decrease.
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Government Regulation; Maintenance of Licenses and Certification
We are subject to numerous state regulations relating to the preparation
and sale of food. We are also subject to federal and state laws governing our
relationship with employees, including minimum wage requirements, overtime,
working and safety conditions, and citizenship requirements. The failure to
obtain or retain the required food licenses or to be in compliance with
applicable governmental regulations, or any increase in the minimum wage rate,
employee benefits costs (including costs associated with mandated health
insurance coverage) or other costs associated with employees, could adversely
affect our business, financial condition or results of operations. Changes in
the laws regarding the minimum wage rate and other employee benefits and the
preparation and sale of food could adversely affect our operations as well as
the food industry in general. In addition, our products are certified as kosher
by independent entities. We believe that we will continue to meet the kosher
certification requirements; however, to the extent that we rely on our kosher
clientele, the failure to retain or obtain such certification in the future
could have a material adverse effect on our business, financial condition or
results of operations.
Risks Associated With Food Service Industry
The results of operations of food service businesses are affected by,
among other things, changes in consumer tastes, national, regional and local
economic conditions, demographic trends, traffic patterns and the type, number,
and location of competing units. Food service companies also can be
substantially adversely affected by publicity resulting from poor food quality,
illness, injury, health concerns, methods of food preparation or operating
difficulties. We can not offer assurance that we will be able to maintain the
quality of our products or avoid adverse publicity in the event of an illness,
injury or the like. We are dependent on frequent deliveries of fresh
ingredients. Therefore, we are subject to the risk that shortages or
interruptions in supply caused by adverse weather or other conditions could
adversely affect the availability, quality, and cost of such ingredients. To the
extent that we supply baked goods to various restaurants and caterers, we are
subject to frequent menu changes by such customers adding and deleting items.
Accordingly, we are subject to the additional risk of order cancellations and
increases, often on short notice.
Competition
The baking industry is a highly competitive and highly fragmented
industry. Competition in both the retail and institutional/wholesale baking
industry is based on product quality, brand name loyalty, price and customer
service. We compete with national, regional and local retail and wholesale
bakeries as well as supermarket chains that have in-store bakeries. Many of our
competitors are larger, more established and have greater financial and other
resources than we do. The specialty coffee/cafe business has become increasingly
competitive and relatively few barriers exist to entry. Some of our major
competitors include Au Bon Pain, Karps, Pillsbury, Country Muffins and
Bake-N-Joy. Our competitors with significant economic resources in the baking
industry or existing non-specialty and specialty coffee/cafe businesses could,
at any time, enter the wholesale or retail bakery/cafe business.
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Quarterly Fluctuations; Seasonality; Possible Volatility of Stock Price
Our operating results are subject to seasonal fluctuations. Historically,
we have realized our highest level of sales in the second and fourth quarters
due to increased sales during the Thanksgiving, Christmas, Chanukah, Easter and
Passover seasons. In addition, our operating results could be subject to
quarterly fluctuations due to the timing of the opening of additional cafes and
kiosks. Such quarterly variations could cause the market price of our common
stock to fluctuate substantially. In addition, the stock markets in the United
States have, from time to time, experienced significant price and volume
fluctuations that are unrelated or disproportionate to the operating
performances of individual companies. Such fluctuations may adversely affect the
price of our common stock.
Lack of Liquidity of Common Stock
Our common stock was delisted from the Nasdaq SmallCap Market in September
1998 and since we were delisted, our common stock has been traded on the NASD
OTC Bulletin Board. Accordingly, an investor will likely find it more difficult
to dispose of, or to obtain accurate quotations as to the market value of, our
common stock. In addition, our common stock may become subject to "penny stock"
regulations promulgated by the Securities and Exchange Commission. Under such
regulations, brokers-dealers are required, among other things, to comply with
disclosure requirements and special investor suitability determinations prior to
a sale. If our common stock becomes subject to these regulations, the market
price of our common stock and liquidity thereof would be adversely affected. See
"Description of Securities."
State Registration Required for Sales of Shares
Under the securities laws of certain states, our securities may not be
sold unless they are qualified for sale or are exempt from regulation under the
state securities laws of the state in which the prospective purchaser resides.
Dilution
As of the date of this Prospectus, there are outstanding (i) options to
purchase 100,000 shares of common stock and (ii) warrants to purchase 2,485,000
shares of our common stock. The exercise of all or a substantial portion of all
of the outstanding options and warrants (including the warrants), and the
issuance of any additional securities which are exercisable for or convertible
into shares of our common stock, will have a dilutive effect, which could be
substantial, on the value of the then outstanding shares of our common stock.
Possible Adverse Effect of Issuance of Preferred Stock
Our Restated Certificate of Incorporation authorizes the issuance of
2,000,000 shares of preferred stock, with designations, rights and preferences
as determined from time to time by the Board of Directors. As a result of the
foregoing, the Board of Directors can issue, without further shareholder
approval, preferred stock with dividend, liquidation, conversion, voting or
other rights that could adversely affect the voting power or other rights of the
holders of the common stock. The issuance of preferred stock could, under
certain circumstances, discourage, delay or prevent a change in control.
Although we have no plans to issue any shares of preferred stock, there can be
no assurance that we will not issue preferred stock at some future date.
Shares Eligible for Future Sale
As of the date of this Prospectus, there are 5,305,250 shares of our
common stock outstanding. Of such shares, 2,608,252 shares of our common stock
are "restricted securities"
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under Rule 144. Of such shares, 891,250 are being registered herein. The
remaining 1,717,002 outstanding restricted securities may be sold only pursuant
to a registration statement under the Securities Act of 1933, as amended
("Securities Act"), or an applicable exemption, including pursuant to Rule 144.
Under Rule 144, a person who has owned Common Stock for at least one year may,
under certain circumstances, sell within any three-month period, a number of
shares of Common Stock that does not exceed the greater of 1% of the then
outstanding shares of Common Stock or the average weekly trading volume during
the four calendar weeks prior to such sale. In addition, a person who is not
deemed to have been an affiliate of the Company at any time during the three
months preceding a sale, and who has beneficially owned the restricted
securities for the last two years, is entitled to sell all such shares without
regard to the volume limitations, current public information requirements,
manner of sale provisions and notice requirements. Sales or the expectation of
sales of a substantial number of shares of Common Stock in the public market
following this offering could adversely affect the prevailing market price of
the Common Stock.
Dividend Policy
Generally. We expect to retain earnings, if any, to finance the expansion
and development of our business and we do not anticipate making any cash
dividend payment in the foreseeable future.
Effect of Certain Charter Provisions.
Authority of Board of Directors to Issue Preferred Stock. Pursuant to the
terms of our charter, our Board of Directors has the authority to issue up to
2,000,000 shares of preferred stock in one or more series. Our Board of
Directors may also determine the prices, rights, preferences, privileges and
restrictions, including voting rights, of the shares within each series without
any further shareholder vote or action. The rights of the holders of preferred
stock that our Board of Directors may issue may adversely affect the rights of
the holders of common stock. While the issuance of such preferred stock could
facilitate possible acquisitions and other corporate activities, it could also
impede a third party's ability to acquire control of our company.
Limitation of Liability of Directors. Pursuant to the terms of our charter
and to the extent New York law permits, we and our shareholders may not hold our
directors personally liable for monetary damages in the event of a breach of
fiduciary duty.
Impact of Year 2000
The Year 2000 issue is the result of computer-controlled systems using two
digits rather than four to define the applicable year. For example, computer
programs that have time sensitive software may recognize a date using "00" as
the year 1900 instead of the year 2000. This reading could result in a system
failure or miscalculations and cause a disruption in operations, including,
among other things, a temporary inability to process transactions, send invoices
or engage in similar normal business activity.
Based on a recent assessment, we have determined that we will be required
to modify or replace portions of our software and hardware so that our systems
will function properly with respect to the dates in the year 2000 and
thereafter. We presently believe that with modifications to existing software
and hardware, the Year 2000 issue will not pose significant operational
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problems for our systems.
Anti-takeover Effects of New York Law.
Certain anti-takeover provisions of New York law could delay or hinder a
change of control of our company. While such provisions generally facilitate our
Board of Directors' ability to maximize shareholder value, they may discourage
takeovers that could be in the best interest of certain shareholders. Such
provisions could adversely affect the market value of our stock in the future.
USE OF PROCEEDS
The shares of common stock offered hereby are being registered for the
account of the selling shareholders identified in this prospectus. See "Selling
Shareholders." All net proceeds from the sale of the common stock will go to the
shareholders who offer and sell their shares. Accordingly, we will not receive
any part of the proceeds from such sales of the common stock.
SELLING SHAREHOLDERS
The selling shareholders have informed us that the name, address, maximum
number of shares of common stock to be sold and total number of shares of common
stock that each selling shareholder owns are as set forth in the following
table. The selling shareholders may sell all or part of their shares of common
stock pursuant to this prospectus. The offering of such shares of common stock
is not being underwritten on a firm commitment basis. As a result, we cannot
give you estimates as to the number and percentage of shares of common stock
each selling shareholder will hold upon termination of this offering. However,
we have assumed, for purposes of the following table, that all of the shares
being offered hereunder will be sold.
Selling Shareholders
<TABLE>
<CAPTION>
No. of Shares of Maximum No. No. of Shares of Percentage of
Common Stock of Shares of Common Stock Common Stock
Beneficially Owned Common Stock to be Owned to be Owned
Name and Address Prior to Offering to be Offered After Offering After Offering (#)
---------------- ----------------- ------------- -------------- ------------------
<S> <C> <C> <C> <C>
Adjunct & Co. 500,000 500,000 0 *
Paine Webber Small Cap Fund
c/o Mitchell Hutchins Asset
Management Inc.
Attn: Don Jones
1285 Avenue of the Americas
15th Floor
New York, NY 10019
David Abrahami (1) 540,000 60,000 480,000 9%
c/o Rabinowiz, Trenk,
Lubetkin & Tully
200 Executive Drive
Suite 225
West Orange, NJ 07052-3303
</TABLE>
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<TABLE>
<CAPTION>
No. of Shares of Maximum No. No. of Shares of Percentage of
Common Stock of Shares of Common Stock Common Stock
Beneficially Owned Common Stock to be Owned to be Owned
Name and Address Prior to Offering to be Offered After Offering After Offering (#)
---------------- ----------------- ------------- -------------- ------------------
<S> <C> <C> <C> <C>
Geraldine P. Baileys, TTEE 200,000 200,000 0 *
Baileys Family Trust
Attn: Karen Brenner
1300 Bristol Street North
Suite 230
Newport Beach, CA 92660
Pearlman Family Revocable 56,250 56,250 0 *
Trust
c/o Al Pearlman
17 Barry Street
Randolph, MA 02368
Swan Alley (Nominees) Ltd. 175,000 75,000 100,000 2%
40 Queen Street
London, EC4R1DD
England
</TABLE>
- ----------
* Percentage of ownership after the offering is less than 1%.
(1) In 1998, Mr. Abrahami resigned as our Chief Operating Officer. In
connection with the resignation, we entered into a settlement agreement
pursuant to which we are required to register 60,000 shares of Mr.
Abrahami's common stock owned by Mr. Abrahami.
PLAN OF DISTRIBUTION
The selling shareholders may offer their shares of common stock directly
or through pledgees, donees, transferees or other successors in interest in one
or more of the following types of transactions:
o in the over-the-counter market;
o on any stock exchange on which shares of common stock may be
listed at the time of sale;
o in negotiated transactions; or
o in a combination of any of the above transactions.
The selling shareholders may offer their shares of common stock at any of
the following prices:
o fixed prices which may be changed;
o market prices prevailing at the time of sale;
o prices related to such prevailing market prices; or
o at negotiated prices.
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<PAGE>
The selling shareholders may sell their shares of common stock by one or
more of the following methods, without limitation:
o a block trade in which the broker-dealer so engaged will
attempt to sell the shares as agent but may position and
resell a portion of the block as principal to facilitate the
transaction;
o a broker or dealer may purchase as principal and resell for
its account pursuant to this prospectus;
o ordinary brokerage transactions and transactions in which the
broker solicits purchasers; and
o face-to-face transactions between the selling shareholders and
purchasers without a broker-dealer.
In effecting sales, brokers or dealers that the selling shareholders
engage may arrange for other brokers or dealers to participate. The selling
shareholders may give such brokers or dealers commissions or discounts in
amounts to be negotiated immediately prior to the sale. Such brokers or dealers
and any other participating brokers or dealers may be deemed to be
"underwriters" within the meaning of Section 2(11) of the Securities Act in
connection with such sales.
In addition, any securities covered by this prospectus that qualify for
sale pursuant to Rule 144 might be sold under Rule 144 rather than pursuant to
this prospectus. The selling shareholders and any broker-dealers acting in
connection with the sale of shares of common stock hereunder may be deemed to be
"underwriters" within the meaning of Section 2(11) of the Securities Act, and
any commissions received by them and any profit realized by them on the resale
of shares of common stock as principals may be deemed underwriting compensation
under the Securities Act.
If and when a selling shareholder notifies us of that he or she has
entered into a material arrangement with a broker-dealer for the sale of shares
of common stock through a block trade, special offering or secondary
distribution or a purchase by a broker or dealer, we will file a supplemental
prospectus, if required pursuant to Rule 424(c) under the Securities Act,
disclosing (1) the name of the selling shareholder and of the participating
broker-dealer(s); (2) the number of shares of common stock involved; (3) the
price at which such shares of common stock were sold; (4) the commissions paid
or discounts or concessions allowed to such broker-dealer(s), where applicable;
(5) that such broker-dealer(s) did not conduct any investigation to verify the
information set out or incorporated by reference in this prospectus; and (6)
other facts material to the transaction.
The selling shareholders reserve the sole right to accept and, together
with any agent of any selling shareholder, to reject in whole or in part any
proposed purchase of the shares of common stock. The selling shareholders will
pay any sales commissions or other seller's compensation applicable to such
transactions.
We have not registered or qualified offers and sales of shares of the
common stock under
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<PAGE>
the laws of any country, other than the United States. To comply with certain
states' securities laws, if applicable, the selling shareholders will offer and
sell their shares of common stock in such jurisdictions only through registered
or licensed brokers or dealers. In addition, in certain states the selling
shareholders may not offer or sell shares of common stock unless we have
registered or qualified such shares for sale in such states or we have complied
with an available exemption from registration or qualification.
Under applicable rules and regulations under the Exchange Act, any person
engaged in a distribution of shares of the common stock may not simultaneously
engage in market-making activities with respect to such shares of common stock
for a period of two to nine business days prior to the commencement of such
distribution. In addition, the selling shareholders and any other person
participating in a distribution will be subject to applicable provisions of the
Exchange Act and the rules and regulations thereunder, including without
limitation, Rules 10b-2, 10b-6 and 10b-7. Such provisions may limit the timing
of purchases and sales of any of the shares of common stock by the selling
shareholders or any such other person. This may affect the marketability of the
common stock and the brokers' and dealers' ability to engage in market-marking
activities with respect to the common stock.
We will pay substantially all of the expenses incident to the registration
of the shares of common stock by filing the registration statement of which this
prospectus is a part, estimated to be approximately $6000.00.
DESCRIPTION OF SECURITIES TO BE REGISTERED
Our authorized capital stock consists of 10,000,000 shares of common
stock, par value $.001 per share, and 2,000,000 shares of preferred stock, par
value $.001 per share. As of the date of this Prospectus, 5,305,250 shares of
our common stock were issued and outstanding, no shares of preferred stock were
issued and outstanding and approximately 2,585,000 shares of common stock
(subject to adjustment) were issuable upon exercise of outstanding options and
warrants.
Common Stock
Voting, Dividend and Other Rights. Each outstanding share of common stock
will entitle the holder to one vote on all matters presented to the shareholders
for a vote. Holders of shares of common stock will have no preemptive,
subscription or conversion rights. All shares of common stock to be outstanding
following this offering will be duly authorized, fully paid and nonassessable.
Our Board of Directors will determine if and when distributions may be paid out
of legally available funds to the holders. We have not declared any cash
dividends during the past fiscal year with respect to the common stock. Our
declaration of any cash dividends in the future will depend on our Board of
Directors' determination as to whether, in light of our earnings, financial
position, cash requirements and other relevant factors existing at the time, it
appears advisable to do so.
Rights Upon Liquidation. Upon liquidation, subject to the rights of any
holders of the preferred stock, if any, to receive preferential distributions,
each outstanding share of common stock may participate pro rata in the assets
remaining after payment of, or adequate provision for,
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<PAGE>
all our known debts and liabilities.
Majority Voting. The holders of a majority of the outstanding shares of
common stock constitute a quorum at any meeting of the shareholders. A plurality
of the votes cast at a meeting of shareholders elects our directors. The common
stock does not have cumulative voting rights. Therefore, the holders of a
majority of the outstanding shares of common stock can elect all of our
directors. In general, a majority of the votes cast at a meeting of shareholders
must authorize shareholders action other than the election of directors.
However, the Business Corporation Law of the State of New York provides that
certain extraordinary matters, such as a merger or consolidation in which we are
a constituent corporation, a sale or other disposition of all or substantially
all of our assets, and our dissolution, require the vote of the holders of
two-thirds of all outstanding voting shares. Most amendments to our certificate
of incorporation require the vote of the holders of a majority of all
outstanding voting shares.
Preferred Stock
Authority of Board of Directors to Create Series and Fix Rights. Under our
certificate of incorporation, as amended, our Board of Directors can issue up to
2,000,000 shares of preferred stock from time to time in one or more series. The
Board of Directors is authorized to fix by resolution as to any series the
designation and number of shares of the series, the voting rights, the dividend
rights, the redemption price, the amount payable upon liquidation or
dissolution, the conversion rights, and any other designations, preferences or
special rights or restrictions as may be permitted by law. Unless the nature of
a particular transaction and the rules of law applicable thereto require such
approval, the Board of Directors has the authority to issue these shares of
preferred stock without shareholder approval.
Potential Dilution of Share Value; Preferences. Any issuance of shares of
preferred stock could dilute the earnings per share and book value of existing
shares of common stock. Because our Board of Directors has the authority to fix
the voting rights for any series of preferred stock, the holders of shares of a
new series of preferred stock could be entitled to vote separately as a class in
connection with the approval of certain extraordinary corporate transactions
where New York law does not require such class vote, or might be given a
disproportionately large number of votes. The issuance of shares of preferred
stock could also result in a class of securities outstanding that would have
certain preferences (for example, with respect to dividends or liquidation), or
would enjoy certain voting rights in addition to those of the common stock.
Potential Frustration in Change of Control . Although we currently have no
such intention, we could use authorized but unissued shares of preferred stock
to hinder a change in control of our company. Any issuance of shares of
preferred stock could dilute the stock ownership of persons seeking to gain
control. Shares of a new series of preferred stock could also be convertible
into a large number of shares of common stock or have other terms that might
make more difficult or costly the acquisition of a controlling interest in our
company. Under certain circumstances, such shares could be used to create voting
impediments or to frustrate persons attempting to effect a takeover or otherwise
gain control. Such shares could be privately placed with purchasers who might
side with the Board of Directors in opposing a hostile takeover bid. In
addition, the Board of Directors could authorize holders of a series of
preferred stock to vote as a class, either separately or with the holders of the
common stock, on any merger, sale or exchange of assets by us or any other
extraordinary corporate transactions. The
14
<PAGE>
ability of the Board of Directors to take such actions might be considered as
having an effect of discouraging any attempt by another person or entity to
acquire control of our company.
Transfer Agent
The registrar and transfer agent for our common stock is American
Securities Transfer & Trust, Inc.
LEGAL MATTERS
Pryor Cashman Sherman & Flynn LLP, New York, New York, will pass upon
certain legal matters in connection with this offering, including the validity
of the issuance of the shares of common stock offered by this prospectus.
EXPERTS
Our consolidated balance sheets as of December 31, 1998 and 1997, and the
related consolidated statements of operations, stockholders' equity and cash
flows for the two years ended December 31, 1998 appearing in our Annual Report
on Form 10-KSB for the year ended December 31, 1998, have been audited by Zeller
Weiss & Kahn, LLP, independent auditors, as set forth in their report thereon
included therein and incorporated herein by reference. The financial statements
referred to above are incorporated herein by reference in reliance upon such
report given upon the authority of such firm as experts in accounting and
auditing.
15
<PAGE>
================================================================================
No dealer, sales representative, or other person has been authorized to
give any information or to make any representations in connection with this
offering other than those contained in this Prospectus, and if given or made,
such information or representation must not be relied upon as having been
authorized by the Company or any Underwriter. This Prospectus does not
constitute an offer to sell or a solicitation of an offer to buy any of the
securities offered hereby by anyone in any jurisdiction in which such offer or
solicitation is not authorized or in which the person making such offer or
solicitation is not qualified to do so or to any person to whom it is unlawful
to make such offer or solicitation. Neither the delivery of this Prospectus nor
any sale made hereunder shall, under any circumstances, create any implication
that there has been no change in the affairs of the Company since the date
hereof or that the information contained herein is correct as of any time
subsequent to the date hereof.
----------
TABLE OF CONTENTS
Page
Where You Can Find More Information .................................... 1
Incorporation of Certain Documents by Reference ......................... 1
About the Company ....................................................... 2
Risk Factors ............................................................ 5
Use of Proceeds ......................................................... 10
Selling Shareholders .................................................... 10
Plan of Distribution .................................................... 11
Description of Securities to be Registered .............................. 13
Legal Matters ........................................................... 15
Experts ................................................................. 15
================================================================================
================================================================================
891,250 Shares
CREATIVE BAKERIES, INC.
Common Stock
----------
PROSPECTUS
----------
September __, 1999
================================================================================
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. Other Expenses of Issuance and Distribution.
Estimated expenses to be paid by the Company in connection with the
issuance and distribution of the securities being registered are as follows:
Registration Fee .............................................. $
------------
Legal Fees and Expenses ....................................... $ 5000.00
------------
Accounting Fees and Expenses .................................. $1000.00
------------
Miscellaneous ................................................. $ 0
------------
Total $ 6000.00
------------
ITEM 15. Indemnification of Directors and Officers
Reference is made to Sections 721 through 725 of the Business Corporation
Law of the State of New York (the "BCL"), which provides for indemnification of
directors and officers of New York corporations under certain circumstances.
Section 722 of the BCL provides that a corporation may indemnify directors
and officers as well as other employees and individuals against judgments,
fines, amounts paid in settlement and reasonable expenses, including attorneys'
fees, in connection with actions or proceedings, whether civil or criminal
(other than an action by or in the right of the corporation, a "derivation
action"), if they acted in good faith and in a manner they reasonably believed
to be in or not opposed to the best interests of the corporation, and, with
respect to any criminal action or proceeding, had no reasonable cause to believe
their conduct was unlawful. A similar standard is applicable in the case of
derivative actions, except that indemnification only extends to amounts paid in
settlement and reasonable expenses (including attorneys' fees) incurred in
connection with the defense or settlement of such actions, and the statute does
not apply in respect of a threatened action, or a pending action that is settled
or otherwise disposed of, and requires court approval before there can be any
indemnification where the person seeking indemnification has been found liable
to the corporation. Section 721 of the BCL provides that Article 7 of the BCL is
not exclusive of other indemnification that may be granted by a corporation's
certificate of incorporation, disinterested director vote, shareholders vote,
agreement or otherwise.
The Registrant's bylaws limit the indemnification that the Registrant
shall provide to judgments, fines, amounts paid in settlement and reasonable
expenses, including attorney's fees, actually and necessarily incurred as a
result of the action or proceeding. Notwithstanding such limitation, the
Registrant may pay in advance of final disposition expenses incurred by such
person in defending such action or proceeding. The Registrant's bylaws apply the
same limitation to all actions or proceedings, including derivation actions.
<PAGE>
Section 402(b) of the BCL provides that a corporation's certificate of
incorporation may include a provision that eliminates or limits the personal
liability of the corporation's directors to the corporation or its shareholders
for damages for any breach of a director's duty, provided that such provision
does not eliminate or limit (1) the liability of any director if a judgment or
other final adjudication adverse to the director establishes that the director's
acts or omissions were in bad faith or involved intentional misconduct or a
knowing violation of law or that the director personally gained a financial
profit or other advantage to which the director was not legally entitled or that
the director's acts violated Section 719 of the BCL; or (2) the liability of any
director for any act or omission prior to the adoption of a provision authorized
by Section 402(b) of the BCL. Article Ninth of the Registrant's Certificate of
Incorporation, as amended, provides that no director of the Registrant shall be
liable to the Registrant or its shareholders for any breach of duty in such
capacity except as provided in Section 402(b) of the BCL.
Any amendment to or repeal of the Registrant's Certificate of
Incorporation or by-laws shall not adversely affect any right or protection of a
director or officer of the Registrant for or with respect to any acts or
omissions of such director or officer occurring prior to such amendment or
repeal.
The Registrant maintains directors and officers insurance which, subject
to certain exclusions, insures the directors and officers of the Registrant
against certain losses which arise out of any neglect or breach of duty
(including, but not limited to, any error, misstatement, act, or omission) by
the directors or officers in the discharge of their duties, and insures the
Registrant against amounts which it has paid or may become obligated to pay as
indemnification to its directors and/or officers to cover such losses.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers or persons controlling the
Registrant pursuant to the foregoing, the Registrant has been informed that in
the opinion of the SEC such indemnification is against public policy as
expressed in the Securities Act and is therefore unenforceable.
Item 16. Exhibits
Exhibit No. Description
----------- -----------
5 Opinion of Pryor Cashman Sherman & Flynn LLP
23.1 Consent of Pryor Cashman Sherman & Flynn LLP
(included as part of Exhibit 5)
23.2 Consent of Zeller Weiss & Kahn, LLP
24 Powers of Attorney (included in the signature page
of this Registration Statement)
Item 17. Undertakings
(a) The undersigned Registrant hereby undertakes:
II-2
<PAGE>
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the Registration Statement (or the most
recent post-effective amendment thereof) which, individually or in
the aggregate, represent a fundamental change in the information set
forth in the Registration Statement. Notwithstanding the foregoing,
any increase or decrease in volume of securities offered (if the
total dollar value of securities offered would not exceed that which
was registered) and any deviation from the low or high and of the
estimated maximum offering range may be reflected in the form of
prospectus filed with the SEC pursuant to Rule 424(b) if, in the
aggregate, the changes in volume and price represent no more than a
20 percent change in the maximum aggregate offering price set forth
in the "Calculation of Registration Fee" table in the effective
Registration Statement;
(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;
provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the SEC
by the Registrant pursuant to Section 13 or 15(d) of the Exchange Act that are
incorporated by reference 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.
(b) 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) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) 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 therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(c) 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 provisions described in Item 15 of this
Registration Statement, or otherwise, the Registrant has been advised that in
the opinion of the SEC such indemnification is against public policy as
II-3
<PAGE>
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.
II-4
<PAGE>
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 the
requirements for filing on Form S-3 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 this 9th day of
September, 1999.
CREATIVE BAKERIES, INC.
By: /s/ Philip Grabow
-----------------------
Philip Grabow
President and
Chief Executive Officer
By: /s/ Ashwin R. Shah
-----------------------
Ashwin R. Shah
Chief Financial Officer
<PAGE>
POWER OF ATTORNEY
Each person whose signature appears below hereby constitutes Philip
Grabow, his true and lawful attorney-in-fact with full power to execute in the
name of such person, in the capacities stated below, and to file, such one or
more amendments to this Registration Statement as the Registrant deems
appropriate, and generally to do all such things in the name and on behalf of
such person, in the capacities stated below, to enable the Registrant to comply
with the provisions of the Securities Act of 1933, and all requirements of the
Securities and Exchange Commission thereunder, hereby ratifying and confirming
the signature of such person as may be signed by said attorneys-in-fact, or any
one of them, to any and all amendments to this Registration Statement.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
Dated: September 9, 1999 /s/ Philip Grabow
-------------------------------------
(Philip Grabow)
President and Chief Executive Officer
Dated: September 9, 1999 /s/ Richard Fector
-------------------------------------
(Richard Fector)
Director
Dated: September 9, 1999 /s/ Raymond J. McKinstry
-------------------------------------
(Raymond J. McKinstry)
Director
Dated: September 9, 1999 /s/ Kenneth Sitomer
-------------------------------------
(Kenneth Sitomer)
Director
Dated: September 9, 1999 /s/ Karen Brenner
-------------------------------------
(Karen Brenner)
Director
Dated: September 9, 1999 /s/ Yona Gonen
-------------------------------------
(Yona Gonen)
Director
EXHIBIT 5
September 9, 1999
Creative Bakeries, Inc.
20 Passaic Avenue
Fairfield, New Jersey 07004
Gentlemen:
We refer to the Registration Statement on Form S-3 (the "Registration
Statement"), to be filed by you with the Securities and Exchange Commission with
respect to the registration under the Securities Act of 1933, as amended (the
"Act"), of 891,250 shares of common stock, par value $.001 per share (the
"Shares"), of Creative Bakeries, Inc. (the "Company") for resale by the Selling
Shareholders (as set forth in the Registration Statement).
We are qualified to practice law in the State of New York. We express no
opinion as to, and, for the purposes of the opinion set forth herein, we have
conducted no investigation of, and do not purport to be experts on, any laws
other than the laws of the State of New York and the federal laws of the United
States of America.
We have examined such documents as we considered necessary for the
purposes of this opinion and, as to matters of fact, have relied upon
certificates of the Company and its officers. Based on such examination, it is
our opinion that the Shares have been duly authorized and are legally issued,
fully-paid and non-assessable under the laws of the State of New York (the state
of incorporation of the Company).
We consent to the use of this opinion as an exhibit to the Registration
Statement.
Very truly yours,
PRYOR CASHMAN SHERMAN & FLYNN LLP
EXHIBIT 23.2
CONSENT OF INDEPENDENT AUDITORS
We have issued our report dated April 7, 1999 accompanying the
consolidated financial statements of Creative Bakeries, Inc. and subsidiaries
included in the Annual Report on Form 10-KSB for the year ended December 31,
1999 which are incorporated by reference in this Registration Statement. We
consent to the incorporation by reference in the Registration Statement of the
aforementioned report and schedule and to the use of our name as it appears
under the caption "Experts."
/s/ Zeller Weiss & Kahn, LLP
ZELLER WEISS & KAHN, LLP
Mountainside, New Jersey
September 7, 1999
