<SUBMISSION>
<ACCESSION-NUMBER>0001169232-07-003947
<TYPE>10QSB
<PUBLIC-DOCUMENT-COUNT>3
<PERIOD>20070831
<FILING-DATE>20071019
<DATE-OF-FILING-DATE-CHANGE>20071019
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>American Home Food Products, Inc.
<CIK>0000945634
<ASSIGNED-SIC>3272
<IRS-NUMBER>411759882
<STATE-OF-INCORPORATION>NY
<FISCAL-YEAR-END>0531
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>10QSB
<ACT>34
<FILE-NUMBER>000-26112
<FILM-NUMBER>071181470
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>67 WALL STREET, SUITE 2001
<CITY>NEW YORK
<STATE>NY
<ZIP>10005
<PHONE>2128251400
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>67 WALL STREET, SUITE 2001
<CITY>NEW YORK
<STATE>NY
<ZIP>10005
</MAIL-ADDRESS>
<FORMER-COMPANY>
<FORMER-CONFORMED-NAME>NOVEX SYSTEMS INTERNATIONAL INC
<DATE-CHANGED>19990525
</FORMER-COMPANY>
</FILER>
<DOCUMENT>
<TYPE>10QSB
<SEQUENCE>1
<FILENAME>d72834_10qsb.htm
<DESCRIPTION>QUARTERLY REPORT
<TEXT>
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<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

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<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>FORM 10-QSB  </font></H1>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Project" -->
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>UNITED STATES<BR>
                                         SECURITIES AND EXCHANGE COMMISSION<BR>
                                               Washington, D.C. 20549  </font></H1>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font face=Wingdings>x </font></p> </td>
        <td  valign=top style='padding:0in 0in 9.0pt 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED AUGUST 31, 2007 </font></p> </td> </tr></table>

<table border="0" cellspacing=0 cellpadding=0 width="33" style='margin-left:233.25pt;border-collapse:collapse'>
    <tr >
        <td width="33" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>or </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2><font face=Wingdings>o </font> </font></p> </td>
        <td  valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM _____ TO _____.  </font></p> </td> </tr></table>



<p style=' margin-bottom:14pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0pt;margin-bottom:0pt'><font SIZE=2>AMERICAN HOME FOOD PRODUCTS INC. </font></p> </td> </tr>
    <tr >
        <td width="384" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0pt;margin-bottom:0pt'><font size=2>(Formerly Novex Systems International Inc.) </font><br> <font size=2>(Exact name of registrant as specified in its charter) </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


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        <td width="168" valign=top style='border-bottom:solid black 1.0pt; padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0pt;margin-bottom:0pt'><font size=2>New York </font></p> </td>
        <td width="150" valign=top style='border-bottom:solid black 1.0pt; padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0pt;margin-bottom:0pt'><font size=2>0-26112 </font></p> </td>
        <td width="138" valign=top style='border-bottom:solid black 1.0pt; padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0pt;margin-bottom:0pt'><font size=2>41-1759882 </font></p> </td> </tr>
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        <td width="168" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0pt;margin-bottom:0pt'><font size=2>(State of Jurisdiction) </font><u></u></p> </td>
        <td width="150" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0pt;margin-bottom:0pt'><font size=2>(Commission </font><br> <font size=2>File Number) </font></p> </td>
        <td width="138" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0pt;margin-bottom:0pt'><font size=2>(IRS Employer </font><br> <font size=2>Identification No.) </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0pt;margin-bottom:0pt'><font size=2>42 Forest Lane   Bronxville, New York </font></p> </td>
        <td width="131" valign=top style='border-bottom:solid black 1.0pt; padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0pt;margin-bottom:0pt'><font size=2>10708 </font></p> </td> </tr>
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        <td width="325" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0pt;margin-bottom:0pt'><font size=2>(Address of Principal Executive offices) </font></p> </td>
        <td width="131" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0pt;margin-bottom:0pt'><font size=2>(Zip Code) </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>Registrant&#146;s telephone number, including area code  </font><u><font size=2>914-441-3591 </font></u></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to filing requirements for the
past 90 days. <BR>Yes <font face=Wingdings>x </font> No <font face=Wingdings>o</font>. </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>The Company had 6,857,649 shares of its $.001 par value common stock and 3,915,000 shares of its $.001 par value preferred stock issued and outstanding on August 31, 2007. </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><u><font SIZE=2>DOCUMENTS INCORPORATED BY REFERENCE </font></u></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><u><font size=2>Location in Form 10-Q </font></u></p> </td>
        <td width="171" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><u><font size=2>Incorporated Document </font></u></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>None </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'>
</p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>
<br>
<HR noshade align="center" width="100%" size="2">
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<pAGE>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><b><font SIZE=2>AMERICAN HOME FOOD PRODUCTS, INC. </font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Index </font></b></p> </td>
        <td   colspan="2">
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp; </font></td> </tr>
    <tr >
        <td   colspan="2">
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp; </font></td>
        <td width="81" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><u><b><font size=2>Page No. </font></b></u></p> </td> </tr>
    <tr>
        <td width="59" ></td>

        <td width="207" ></td>

        <td width="81" ></td> </tr> </table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Part I   </font></b></p> </td>
        <td width="171" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Financial Information </font></b></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Item 1. </font></p> </td>
        <td width="235" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Financial Statements (Unaudited) </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2><A HREF="#A001">Balance Sheet as of August 31, 2007 </A></font></p> </td>
        <td width="43" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font SIZE=2><A HREF="#A001">F-1</A> </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:1in;text-align:left;'><font size=2><A HREF="#A002">Statements of Operations for the</A> </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:1in;text-align:left;'><font size=2><A HREF="#A002">three months ended August 31, 2007 and</A> </font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2><A HREF="#A002">August 31, 2006 </A></font></p> </td>
        <td width="43" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font SIZE=2><A HREF="#A002">F-2</A> </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:1in;text-align:left;'><font size=2><A HREF="#A003">Statements of Cash Flows for the</A> </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:1in;text-align:left;'><font size=2><A HREF="#A003">three months ended August 31, 2007 and</A> </font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2><A HREF="#A003">August 31, 2006</A> </font></p> </td>
        <td width="43" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font SIZE=2><A HREF="#A003">F-3</A> </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2><A HREF="#A004">Notes to Financial Statements</A> </font></p> </td>
        <td width="43" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font SIZE=2><A HREF="#A004">F-4</A> </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2><A HREF="#A005">Item 2.</A> </font></p> </td>
        <td width="353" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2><A HREF="#A005">Management&#146;s Discussion and Analysis of Financial</A> </font></p> </td>
        <td   colspan="2">
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp; </font></td> </tr>
    <tr >
        <td  width="96">
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp; </font></td>
        <td  colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2><A HREF="#A005">Condition and Results of Operations</A> </font></p> </td>
        <td width="28" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2><A HREF="#A005">1</A> </font></p> </td> </tr>
    <tr>
        <td width="96" ></td>

        <td width="353" ></td>

        <td width="177" ></td>

        <td width="28" ></td> </tr> </table>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in; text-indent:-0.5in;text-align:left;'><font size=2>&nbsp; </font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2><A HREF="#A006">Item 3.</A> </font></p> </td>
        <td width="531" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2><A HREF="#A006">Controls and Procedures</A> </font></p> </td>
        <td width="28" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2><A HREF="#A006">4</A> </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Part II   </font></b></p> </td>
        <td width="148" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Other Information </font></b></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2><A HREF="#A007">Item 1.</A> </font></p> </td>
        <td width="531" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2><A HREF="#A007">Legal Proceedings</A> </font></p> </td>
        <td width="28" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2><A HREF="#A007">5</A> </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2><A HREF="#A008">Item 2.</A> </font></p> </td>
        <td width="531" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2><A HREF="#A008">Changes in Securities</A> </font></p> </td>
        <td width="28" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2><A HREF="#A008">5</A> </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


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        <td width="96" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2><A HREF="#A009">Item 3. </A></font></p> </td>
        <td width="531" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2><A HREF="#A009">Defaults Upon Senior Securities</A> </font></p> </td>
        <td width="28" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2><A HREF="#A009">6 </A></font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


<table border="0" cellspacing=0 cellpadding=0 width="655" style='border-collapse:collapse'>
    <tr >
        <td width="96" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2><A HREF="#A010">Item 4.</A> </font></p> </td>
        <td width="531" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2><A HREF="#A010">Submission of Matters to a Vote of Security Holders</A> </font></p> </td>
        <td width="28" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2><A HREF="#A010">6</A> </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


<table border="0" cellspacing=0 cellpadding=0 width="655" style='border-collapse:collapse'>
    <tr >
        <td width="96" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2><A HREF="#A011">Item 5.</A> </font></p> </td>
        <td width="531" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2><A HREF="#A011">Other Information</A> </font></p> </td>
        <td width="28" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2><A HREF="#A011">6 </A></font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


<table border="0" cellspacing=0 cellpadding=0 width="655" style='border-collapse:collapse'>
    <tr >
        <td width="96" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2><A HREF="#A012">Item 6.</A> </font></p> </td>
        <td width="531" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2><A HREF="#A012">Exhibits and Reports on Form 8-K </A></font></p> </td>
        <td width="28" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2><A HREF="#A012">6</A> </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'>
</p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>ii </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>
<pAGE>


<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


<table border="0" cellspacing=0 cellpadding=0 width="73" style='margin-left:218.25pt;border-collapse:collapse'>
    <tr >
        <td width="73" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font SIZE=2>PART I </font></b></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


<table border="0" cellspacing=0 cellpadding=0 width="81" style='margin-left:429.0pt;border-collapse:collapse'>
    <tr >
        <td width="81" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><u><b><font size=2>Page No. </font></b></u></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


<table border="0" cellspacing=0 cellpadding=0 width="348" style='border-collapse:collapse'>
    <tr >
        <td width="96" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Item 1.   </font></b></p> </td>
        <td width="252" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Financial Information </font></b><font size=2> (Unaudited) </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


<table border="0" cellspacing=0 cellpadding=0 width="557" style='margin-left:1.0in;border-collapse:collapse'>
    <tr >
        <td width="515" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Balance Sheet as of August 31, 2007 </font></p> </td>
        <td width="43" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font SIZE=2>F-1 </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:1in;text-align:left;'><font size=2>Statements of Operations for the </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:1in;text-align:left;'><font size=2>three months ended August 31, 2007 and </font></p>


<table border="0" cellspacing=0 cellpadding=0 width="557" style='margin-left:1.0in;border-collapse:collapse'>
    <tr >
        <td width="515" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>August 31, 2006 </font></p> </td>
        <td width="43" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font SIZE=2>F-2 </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:1in;text-align:left;'><font size=2>Statements of Cash Flows for the </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:1in;text-align:left;'><font size=2>three months ended August 31, 2007 and </font></p>


<table border="0" cellspacing=0 cellpadding=0 width="557" style='margin-left:1.0in;border-collapse:collapse'>
    <tr >
        <td width="515" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>August 31, 2006 </font></p> </td>
        <td width="43" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font SIZE=2>F-3 </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


<table border="0" cellspacing=0 cellpadding=0 width="557" style='margin-left:1.0in;border-collapse:collapse'>
    <tr >
        <td width="515" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Notes to Financial Statements </font></p> </td>
        <td width="43" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font SIZE=2>F-4 </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>iii </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>
<pAGE>
<BR>

<A NAME="A001"></A>
<!-- MARKER FORMAT-SHEET="Head Minor Center-TNR" FSL="Project" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>AMERICAN HOME FOOD
PRODUCTS, INC. <BR>BALANCE SHEET<BR> August 31, 2007<BR> (unaudited)  </font></P>



<table cellpadding=0 cellspacing=0 border=0 width=600>
  <tr valign=Bottom>
    <th colspan=3><font face="Times New Roman" size=1> </font></th>
    <th colspan=3><font face="Times New Roman" size=1> </font></th>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td colspan="6" align=center><font size="2" face="Times New Roman, Times, serif"><u>ASSETS</u> </font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom>
    <td width=82% align=LEFT><font face="Times New Roman" size=2>CURRENT ASSETS: </font></td>
    <td width=1% align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td width=2% align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td width=1% align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td width=12% align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td width=2% align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;Cash </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>$ </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2> 1,372,748 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;Accounts
      receivable </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>287,008 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;Inventories </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>203,475 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;Prepaid
      expenses and other current assets </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>35,175 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT>&nbsp;</td>
    <td></td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total
      Current Assets </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>1,898,406 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>FIXED ASSETS </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>834,974 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT><font face="Times New Roman" size=2>OTHER ASSETS </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>26,264 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>INTANGIBLES - at cost,
      net </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>3,857,229 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT>&nbsp;</td>
    <td></td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>$ </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2> 6,616,873 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=2></td>
    <td></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr valign=Bottom>
    <td colspan="6" align=center><u><font face="Times New Roman" size=2>LIABILITIES
      AND SHAREHOLDERS&#146; DEFICIENCY </font></u></td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT><font face="Times New Roman" size=2>CURRENT LIABILITIES: </font></td>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;Current
      portion of long term debt </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>$ </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2> 125,000 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;Accounts
      payable </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>479,727 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;Notes
      payable </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>233,000 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;Notes
      payable - seller financing </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>700,000 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;Loans
      payable - shareholder </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>17,193 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;Prepaid
      Gift Certificates and Other Deferred Revenue </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>116,650 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;Accrued
      expenses and other current liabilities </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>158,302 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;Accrued
      interest </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>86,458 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;Accrued
      payroll taxes </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>652,236 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total
      Current Liabilities </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>2,568,566 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>COMMITMENTS AND CONTINGENCY </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&#151; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT><font face="Times New Roman" size=2>LONG TERM DEBT, net of
      current portion </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>500,000 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>SHAREHOLDERS&#146; EQUITY
      (DEFICIENCY): </font></td>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;Preferred
      stock - $0.001 par value, 10,000,000 shares authorized,<br>
      &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3,915,000 shares issued and outstanding </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>3,915,000 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;Common
      stock - $0.001 par value, 40,000,000 shares authorized<br>
      &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6,857,649 shares issued and outstanding </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>6,857 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;Additional
      paid-in capital </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>10,812,064 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;Accumulated
      deficit </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>(11,185,614 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>) </font></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT>&nbsp;</td>
    <td></td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total
      shareholders&#146; equity (deficiency) </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>3,548,307 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT>&nbsp;</td>
    <td></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>$ </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2> 6,616,873 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=2></td>
    <td></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT>&nbsp;</td>
    <td></td>
  </tr>
</table>
<BR><BR>


<!-- MARKER FORMAT-SHEET="Head Minor Center-TNR" FSL="Project" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>See notes to
financial statements.<BR> F-1  </font></P>

<HR SIZE=2 COLOR=GRAY NOSHADE>
<PAGE>



<A NAME="A002"></A>
<!-- MARKER FORMAT-SHEET="Head Minor Center-TNR" FSL="Project" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>AMERICAN HOME FOOD
PRODUCTS, INC.<BR> STATEMENTS OF OPERATIONS  </font></P>

<BR>


<table cellpadding=0 cellspacing=0 border=0 width=600>
  <tr valign=Bottom>
    <th height="24" colspan=3><font face="Times New Roman" size=1> </font></th>
    <td colspan=5 align="center"><font face="Times New Roman" size=2>Three Months
      Ended August 31, </font><font face="Times New Roman" size=1>&nbsp;</font></td>
    <th>&nbsp;</th>
  </tr>
  <tr valign=Bottom>
    <th colspan=3>&nbsp;</th>
    <td colspan=5 align="center">
<hr noshade color=black size=1></td>
    <th>&nbsp;</th>
  </tr>
  <tr valign=Bottom>
    <th colspan=3><font face="Times New Roman" size=1> </font></th>
    <td colspan=2 align="center"><font face="Times New Roman" size=2><u>2007</u><br>
      Unaudited </font></td>
    <td align="center">&nbsp;</td>
    <td colspan=2 align="center"><font face="Times New Roman" size=2><u>2006</u><br>
      Unaudited </font></td>
    <th>&nbsp;</th>
  </tr>
  <tr valign=Bottom>
    <td width=57% align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>ROYALTY
      REVENUE </font></td>
    <td width=1% align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td width=3% align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td width=1% align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>$
      </font></td>
    <td width=15% align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>
      52,039 </font></td>
    <td width=5% align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td width=1% align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>$
      </font></td>
    <td width=15% align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>
      61,792 </font></td>
    <td width=2% align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>SALES </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>167,111 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&#151; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>Totals
      sales and revenue </font></td>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>219,150
      </font></td>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>61,792
      </font></td>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>COST OF GOODS SOLD </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>112,060 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&#151; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>GROSS
      PROFIT </font></td>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>107,090
      </font></td>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>61,792
      </font></td>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>SELLING, GENERAL AND ADMINISTRATIVE
      </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>167,134 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>91,823 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>DEPRECIATION
      AND AMORTIZATION </font></td>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>12,789
      </font></td>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&#151;
      </font></td>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>LOSS FROM OPERATIONS </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>(72,833 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>) </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>(30,031 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>) </font></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>OTHER
      INCOME( EXPENSES): </font></td>
    <td align=LEFT bgcolor="#eaf9e8">&nbsp;</td>
    <td align=LEFT bgcolor="#eaf9e8">&nbsp;</td>
    <td align=RIGHT bgcolor="#eaf9e8">&nbsp;</td>
    <td align=RIGHT bgcolor="#eaf9e8">&nbsp;</td>
    <td align=LEFT bgcolor="#eaf9e8">&nbsp;</td>
    <td align=RIGHT bgcolor="#eaf9e8">&nbsp;</td>
    <td align=RIGHT bgcolor="#eaf9e8">&nbsp;</td>
    <td align=LEFT bgcolor="#eaf9e8">&nbsp;</td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;Interest
      income (expense) </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>(53,852 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>) </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>(40,553 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>) </font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;Gain
      on sale of assets </font></td>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>479,043
      </font></td>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&#151;
      </font></td>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>425,191 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>(40,553 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>) </font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>NET INCOME (LOSS) BEFORE
      INCOME TAXES </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>352,358 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>(70,584 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>) </font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;Income
      taxes </font></td>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&#151;
      </font></td>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&#151;
      </font></td>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>NET INCOME (LOSS) </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>$ </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2> 352,358 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>$ </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2> (70,584 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>) </font></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=2></td>
    <td></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=2></td>
    <td></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>INCOME
      (LOSS) PER COMMON SHARE: </font></td>
    <td align=LEFT bgcolor="#eaf9e8">&nbsp;</td>
    <td align=LEFT bgcolor="#eaf9e8">&nbsp;</td>
    <td align=RIGHT bgcolor="#eaf9e8">&nbsp;</td>
    <td align=RIGHT bgcolor="#eaf9e8">&nbsp;</td>
    <td align=LEFT bgcolor="#eaf9e8">&nbsp;</td>
    <td align=RIGHT bgcolor="#eaf9e8">&nbsp;</td>
    <td align=RIGHT bgcolor="#eaf9e8">&nbsp;</td>
    <td align=LEFT bgcolor="#eaf9e8">&nbsp;</td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic
      </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>$ </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2> 0.07 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>$ </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2> (0.02 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>) </font></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=2></td>
    <td></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=2></td>
    <td></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Diluted
      </font></td>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>$ </font></td>
    <td align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2> 0.04
      </font></td>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>$ </font></td>
    <td align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2> (0.02
      </font></td>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>) </font></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=2></td>
    <td></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=2></td>
    <td></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>WEIGHTED AVERAGE NUMBER
      OF COMMON<br>
      &nbsp;&nbsp;&nbsp;&nbsp;SHARES OUTSTANDING: </font></td>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic
      </font></td>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>5,120,504
      </font></td>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
    <td align=RIGHT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>3,761,455
      </font></td>
    <td align=LEFT bgcolor="#eaf9e8"><font face="Times New Roman" size=2>&nbsp;
      </font></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=2></td>
    <td></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=2></td>
    <td></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Diluted
      </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>8,383,004 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>3,761,455 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=2></td>
    <td></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=2></td>
    <td></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=3></td>
    <td colspan=3></td>
  </tr>
</table>









<!-- MARKER FORMAT-SHEET="Head Minor Center-TNR" FSL="Project" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>See notes to
financial statements.<BR> F-2  </font></P>





<HR SIZE=2 COLOR=GRAY NOSHADE>
<PAGE>
<BR>


<A NAME="A003"></A>
<!-- MARKER FORMAT-SHEET="Head Minor Center-TNR" FSL="Project" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>AMERICAN HOME FOOD
PRODUCTS, INC. <BR>           STATEMENTS OF CASH FLOWS </FONT></P>

<BR>




<table cellpadding=0 cellspacing=0 border=0 width=600>
  <tr valign=Bottom>
    <th colspan=3><font face="Times New Roman" size=1></font></th>
    <td colspan=5 align="center" nowrap><font face="Times New Roman, Times, serif" size=2>Three
      Months ended August 31,</font> <hr width=100% size=1 color=black noshade>
    </td>
    <th>&nbsp;</th>
  </tr>
  <tr valign=Bottom>
    <th colspan=3><font face="Times New Roman" size=1></font></th>
    <td colspan=2 align="center"><font face="Times New Roman, Times, serif" size="2"><u>2007</u><br>
      (Unaudited) </font></td>
    <td align="center"><font size="2" face="Times New Roman, Times, serif">&nbsp;</font></td>
    <td colspan=2 align="center"><font face="Times New Roman, Times, serif" size="2"><u>2006</u><br>
      (Unaudited) </font></td>
    <th>&nbsp;</th>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td width=71% align=LEFT><font face="Times New Roman" size=2>CASH FLOWS FROM
      OPERATING ACTIVITIES:</font></td>
    <td width=1% align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td width=1% align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td width=1% align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td width=10% align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td width=3% align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td width=1% align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td width=10% align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td width=2% align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net
      income (loss)</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>$</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2> 352,358</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>$</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2> (70,584</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>)</font></td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td height="31" align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Adjustments
      to reconcile net income (loss) to net cash<br>
      &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;provided
      by (used in) operating activities:</font></td>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation
      and impairment of equipment</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>5,269</font></td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization
      of goodwill</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>4,943</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>12,628</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gain
      on sale of intangible assets</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>(479,043</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>)</font></td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Changes
      in assets and liabilities, net of the effect from<br>
      &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;acquisition:</font></td>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts
      receivable</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>15,843</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Royalty/Licensee
      receivable</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>30,845</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>(5,098</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>)</font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepaid
      expenses</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&#151;</font></td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts
      payable</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>(394,146</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>)</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>1,306</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued
      expenses and other current liabilities</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>429,499</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>35,967</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued
      payroll taxes</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>106,629</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>15,781</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>NET CASH PROVIDED BY (USED
      IN) OPERATING ACTIVITIES</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>72,197</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>(10,000</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>)</font></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT><font face="Times New Roman" size=2>CASH FLOWS FROM INVESTING
      ACTIVITIES:</font></td>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Purchase
      of Artisanal, net of expenses</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>(3,192,911</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>)</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&#151;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proceeds
      of sale of intangible assets</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>863,747</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&#151;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>NET CASH PROVIDED BY (USED
      IN) INVESTING ACTIVITIES</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>(2,329,164</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>)</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&#151;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT><font face="Times New Roman" size=2>CASH FLOWS PROVIDED BY
      FINANCING ACTIVITIES:</font></td>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Increase
      in notes payable</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>(105,697</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>)</font></td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Payment
      of shareholder note</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>(197,747</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>)</font></td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Sale
      of preferred stock</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>3,915,000</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proceeds
      from shareholder loan</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&#151;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>10,000</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>NET CASH PROVIDED BY (USED
      IN) FINANCING ACTIVITIES</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>3,611,556</font></td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT><font face="Times New Roman" size=2>NET INCREASE IN CASH</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>1,354,589</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&#151;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>CASH AT BEGINNING OF YEAR</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>18,159</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&#151;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT><font face="Times New Roman" size=2>CASH AT END OF PERIOD</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>$</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2> 1,372,748</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>$</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2> &#151;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=2></td>
    <td></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=2></td>
    <td></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>SUPPLEMENTAL CASH FLOW
      INFORMATION:</font></td>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash
      paid during the period for:</font></td>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>$</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2> 9,000</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>$</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2> &#151;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=2></td>
    <td></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=2></td>
    <td></td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income
      taxes</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&#151;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&#151;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=2></td>
    <td></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=2></td>
    <td></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>NON-CASH FINANCING ACTIVITIES:</font></td>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=RIGHT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Artisanal
      seller financing</font></td>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT><font face="Times New Roman" size=2>$</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2> 1,200,000</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>$</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2> &#151;</font></td>
    <td align=LEFT>&nbsp;</td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Payables
      paid with equity</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>$</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2> 530,000</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>$</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2> &#151;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Artisanal
      liabilities assumed</font></td>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT>&nbsp;</td>
    <td align=RIGHT><font face="Times New Roman" size=2>$</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2> 745,516</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>$</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2> &#151;</font></td>
    <td align=LEFT>&nbsp;</td>
  </tr>
</table>
<BR><BR>




<!-- MARKER FORMAT-SHEET="Head Minor Center-TNR" FSL="Project" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>See notes to
financial statements.<BR> F-3  </font></P>





<HR SIZE=2 COLOR=GRAY NOSHADE>
<PAGE>
<BR>


<A NAME="A004"></A>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font SIZE=2>AMERICAN HOME FOOD PRODUCTS, INC.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font SIZE=2>NOTES TO FINANCIAL STATEMENTS</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font SIZE=2>THREE MONTHS ENDEDAUGUST 31, 2007</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>(UNAUDITED)</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>


<table border="0" cellspacing=0 cellpadding=0 width="260" style='border-collapse:collapse'>
    <tr >
        <td width="48" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>1.</font></p> </td>
        <td width="212" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><u><font SIZE=2>BASIS OF PRESENTATION</font></u></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.25in;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>The accompanying unaudited consolidated financial statements of American Home Food Products, Inc. (the &#147;Company&#148;) have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-QSB and Regulation S-B.  Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements.  In the opinion of management, all adjustments considered necessary for a fair presentation (consisting of normal recurring accruals) have been included.  The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.  Operating results expected for the three months ended August 31, 2007 are not necessarily indicative of the results that may be expected for the year ending May 31, 2008.  For further information, refer to the financial statements and footnotes thereto included in the Company&#146;s Annual Report on Form 10-KSB for the year ended May 31, 2007.  Per share data for the periods are based upon the weighted average number of shares of common stock outstanding during such periods, plus net additional shares issued upon exercise of options and warrants.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>


<table border="0" cellspacing=0 cellpadding=0 width="179" style='border-collapse:collapse'>
    <tr >
        <td width="48" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>2.</font></p> </td>
        <td width="131" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><u><font SIZE=2>ACQUISITIONS</font></u></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>On August 15, 2007, the Company acquired all right, title and interest to 100% of the issued and outstanding membership interests of Artisanal Cheese, LLC (&#147;Artisanal&#148;).  The purchase price for this acquisition was approximately $4.4 million plus legal and other professional costs(the &#147;Artisanal Acquisition&#148;).  Pursuant to the membership interest purchase agreement, the Company (i) paid $3,200,000 to the members of Artisanal Cheese, LLC, (ii) issued a note payable for $700,000 which bears no interest and is payable on or before November 14, 2007 (See Note 8 - Notes Payable); (iii) issued a note payable for $130,000 which bears interest at 5% per annum and is payable over a three year period (See Note 15 &#150; Long Term Debt); (iv) issued a note payable for $370,000 which bears interest at 5% per annum and is payable over a three year period (See Note 15 &#150; Long
Term Debt); and (v) issued a note payable to a former Artisanal shareholder for $228,000 payable in one year with payments due quarterly of $57,000 per quarter without interest, payable either in cash or product to one or more of the former shareholders restaurant establishments (See Note 8 - Notes Payable).  As part of this transaction, the Company also entered into (vi) a five-year preferred vendor agreement with two restaurants which are affiliated with the seller; (vii) a five-year product development agreement with the same two restaurants; (viii) a trademark license agreement granting a royalty-free license to a former member of Artisanal Cheese, LLC, to utilize certain trademarks and names in connection with his restaurant establishments; (ix) a one-year consulting agreement with a former member of Artisanal Cheese, </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font SIZE=2>F-4</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>
<pAGE>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>
LLC; and (x) a transitional services agreement pursuant to which the company
shall receive equipment and non-equipment services for one year and comptroller
services for four months (See Note 18 - Commitments and Contingencies).
</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>
As part of this transaction, the Company also obtained from each of the former
members of Artisanal Cheese, LLC, a five-year non-competition
agreement.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>The following table sets forth the determination of the consideration paid for Artisanal at the date of acquisition:</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in; text-indent:-0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<table border="0" cellspacing=0 cellpadding=0 width="92%" style='margin-left:.5in'>
    <tr >
        <td width="514" valign=bottom >
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="13" >
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td>
        <td  colspan="2" valign=bottom >
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td>
        <td width="6" valign=bottom >
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td> </tr>
    <tr >
        <td width="514" valign=bottom style='background:#eaf9e8; '>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Cash</font></p> </td>
        <td width="13" style='background:#eaf9e8'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td>
        <td width="8" valign=bottom style='background:#eaf9e8'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>$</font></p> </td>
        <td width="72" valign=bottom style='background:#eaf9e8'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:right;margin-top:0pt;margin-bottom:0pt'><font size=2>3,298,608</font></p> </td>
        <td width="6" valign=bottom style='background:#eaf9e8'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td> </tr>
    <tr >
        <td width="514" valign=bottom style='background:white; '>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:1.0pt;margin-bottom: 0in'><font size=2>Notes</font></p> </td>
        <td width="13" style='border-bottom:solid white 1.0pt; background:white'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td>
        <td width="8" valign=bottom style='border-bottom:solid black 1.0pt; background:white'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td>
        <td width="72" valign=bottom style='border-bottom: solid black 1.0pt;background:white; '>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:right;margin-top:0pt;margin-bottom:0pt'><font size=2>1,200,000</font></p> </td>
        <td width="6" valign=bottom style='border-bottom:solid white 1.0pt; background:white'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td> </tr>
    <tr >
        <td width="514" valign=bottom style='border-bottom: solid #eaf9e8 3.0pt;background:#eaf9e8'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Total purchase price</font></p> </td>
        <td width="13" style='border-bottom:solid #eaf9e8 1.0pt; background:#eaf9e8'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td>
        <td width="8" valign=bottom style='border-bottom:double black 2.25pt; background:#eaf9e8'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>$</font></p> </td>
        <td width="72" valign=bottom style='border-bottom: double black 2.25pt;background:#eaf9e8'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:right;margin-top:0pt;margin-bottom:0pt'><font size=2>4,498,608</font></p> </td>
        <td width="6" valign=bottom style='border-bottom:solid #eaf9e8 3.0pt; background:#eaf9e8'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in; text-indent:-0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>The transaction was accounted for as a purchase and, accordingly, the preliminary purchase price was allocated to the underlying assets acquired and liabilities assumed based upon their estimated fair values at the date of the acquisition. The Company intends to conduct a detailed valuation using the guidance as set forth in Statement of Financial Accounting Standard (&#147;SFAS&#148;) No.&nbsp;141, &#147;Business Combinations&#148;, to make the final determination of fair value of the intangible assets and goodwill acquired in the acquisition. The purchase price allocation is, therefore, preliminary and may be adjusted for up to one year after the acquisition. </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>The following table sets forth the preliminary allocation of the purchase price:</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<table border="0" cellspacing=0 cellpadding=0 width="92%" style='margin-left:.5in'>
    <tr >
        <td width="514" valign=bottom >
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="13" >
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td>
        <td  colspan="2" valign=bottom >
            <p style='margin-left:.5in;text-indent:-.5in;text-align:right;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td>
        <td width="6" valign=bottom >
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td> </tr>
    <tr >
        <td width="514" valign=bottom style='background:#eaf9e8; '>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Total purchase price</font></p> </td>
        <td width="13" style='background:#eaf9e8'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td>
        <td width="8" valign=bottom style='background:#eaf9e8'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>$</font></p> </td>
        <td width="72" valign=bottom style='background:#eaf9e8'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:right;margin-top:0pt;margin-bottom:0pt'><font size=2>4,498,608</font></p> </td>
        <td width="6" valign=bottom style='background:#eaf9e8'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td> </tr>
    <tr >
        <td width="514" valign=bottom style='background:white; '>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Less assets acquired:</font></p> </td>
        <td width="13" style='background:white'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td>
        <td width="8" valign=bottom style='background:white'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td>
        <td width="72" valign=bottom style='background:white'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:right;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td>
        <td width="6" valign=bottom style='background:white'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td> </tr>
    <tr >
        <td width="514" valign=bottom style='background:#eaf9e8; '>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Accounts receivable</font></p> </td>
        <td width="13" style='background:#eaf9e8'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td>
        <td width="8" valign=bottom style='background:#eaf9e8'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td>
        <td width="72" valign=bottom style='background:#eaf9e8'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:right;margin-top:0pt;margin-bottom:0pt'><font size=2>(287,008</font></p> </td>
        <td width="6" valign=bottom style='background:#eaf9e8'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>)</font></p> </td> </tr>
    <tr >
        <td width="514" valign=bottom style='background:white; '>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Inventory</font></p> </td>
        <td width="13" style='background:white'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="8" valign=bottom style='background:white'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="72" valign=bottom style='background:white'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:right;margin-top:0pt;margin-bottom:0pt'><font size=2>(203,475</font></p> </td>
        <td width="6" valign=bottom style='background:white'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>)</font></p> </td> </tr>
    <tr >
        <td width="514" valign=bottom style='background:#eaf9e8; '>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Other current assets</font></p> </td>
        <td width="13" style='background:#eaf9e8'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td>
        <td width="8" valign=bottom style='background:#eaf9e8'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td>
        <td width="72" valign=bottom style='background:#eaf9e8'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:right;margin-top:0pt;margin-bottom:0pt'><font size=2>(35,175</font></p> </td>
        <td width="6" valign=bottom style='background:#eaf9e8'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>)</font></p> </td> </tr>
    <tr >
        <td width="514" valign=bottom style='background:white; '>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:1.0pt;margin-bottom: 0in'><font size=2>Long - term assets</font></p> </td>
        <td width="13" style='border-bottom:solid white 1.0pt; background:white'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td>
        <td width="8" valign=bottom style='border-bottom:solid black 1.0pt; background:white'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td>
        <td width="72" valign=bottom style='border-bottom: solid black 1.0pt;background:white; '>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:right;margin-top:0pt;margin-bottom:0pt'><font size=2>(861,237</font></p> </td>
        <td width="6" valign=bottom style='background:white'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:1.0pt;margin-bottom: 0in'><font size=2>)</font></p> </td> </tr>
    <tr >
        <td width="514" valign=bottom style='background:#eaf9e8; '>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Total tangible assets acquired</font></p> </td>
        <td width="13" style='background:#eaf9e8'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td>
        <td width="8" valign=bottom style='background:#eaf9e8'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td>
        <td width="72" valign=bottom style='background:#eaf9e8'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:right;margin-top:0pt;margin-bottom:0pt'><font size=2>(1,386,895</font></p> </td>
        <td width="6" valign=bottom style='background:#eaf9e8'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>)</font></p> </td> </tr>
    <tr >
        <td width="514" valign=bottom style='background:white; '>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td>
        <td width="13" style='background:white'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td>
        <td width="8" valign=bottom style='background:white'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td>
        <td width="72" valign=bottom style='background:white'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:right;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td>
        <td width="6" valign=bottom style='background:white'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td> </tr>
    <tr >
        <td width="514" valign=bottom style='background:white; '>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Liabilities assumed</font></p> </td>
        <td width="13" style='background:white'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td>
        <td width="8" valign=bottom style='background:white'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td>
        <td width="72" valign=bottom style='background:white'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:right;margin-top:0pt;margin-bottom:0pt'><font size=2>745,516</font></p> </td>
        <td width="6" valign=bottom style='background:white'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td> </tr>
    <tr >
        <td width="514" valign=bottom style='border-bottom: solid white 3.0pt;background:white'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td>
        <td width="13" style='border-bottom:solid white 1.0pt; background:white'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td>
        <td width="8" valign=bottom style='border-bottom:solid black 1.0pt; background:white'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td>
        <td width="72" valign=bottom style='border-bottom: solid black 1.0pt;background:white; '>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:right;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;&nbsp; &nbsp;</font></p> </td>
        <td width="6" valign=bottom style='border-bottom:solid white 1.0pt; background:white'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td> </tr>
    <tr >
        <td width="514" valign=bottom style='border-bottom: solid #eaf9e8 3.0pt;background:#eaf9e8'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Cost in excess of net tangible assets acquired</font></p> </td>
        <td width="13" style='border-bottom:solid #eaf9e8 1.0pt; background:#eaf9e8'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td>
        <td width="8" valign=bottom style='border-bottom:double black 2.25pt; background:#eaf9e8'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>$</font></p> </td>
        <td width="72" valign=bottom style='border-bottom: double black 2.25pt;background:#eaf9e8'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:right;margin-top:0pt;margin-bottom:0pt'><font size=2>3,857,229</font></p> </td>
        <td width="6" valign=bottom style='border-bottom:solid #eaf9e8 3.0pt; background:#eaf9e8'>
            <p style='margin-left:.5in;text-indent:-.5in;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>&nbsp;</font></p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in; text-indent:-0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>The operating
results for Artisanal are included in the accompanying Consolidated Statements
of Operations from the date of the acquisition. Pro-forma financial results will be included once available by amendment.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font SIZE=2>F-5</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>
<pAGE>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>


<table border="0" cellspacing=0 cellpadding=0 width="460" style='border-collapse:collapse'>
    <tr >
        <td width="48" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>3.</font></p> </td>
        <td width="412" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><u><font SIZE=2>SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES</font></u></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><u><font size=2>Principles of Consolidation </font></u><font size=2> </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>The consolidated financial statements include the accounts of the Company and its majority-owned subsidiaries. All material intercompany accounts and transactions have been eliminated on consolidation.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><u><font size=2>Cash and Cash Equivalents</font></u></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. Cash equivalents include investments in money market funds and are stated at cost, which approximates market value. Cash at times may exceed FDIC insurable limits.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><u><font size=2>Trade Accounts Receivable and Other Receivables, Net</font></u></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>The Company&#146;s accounts receivable consist primarily of amounts due from customers for the sale of its products. The Company records an allowance for doubtful accounts based on management&#146;s estimate of collectibility of such trade and notes receivables outstanding. The allowance for doubtful accounts represents an amount considered by management to be adequate to cover potential losses, if any. The recorded allowance at August 31, 2007 and 2006 was $8,795 and $0 respectively.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><u><font size=2>Property and Equipment</font></u></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>Property and equipment acquired in the Artisanal Acquisition is carried at net book value which approximates fair market value at the date of the acquisition. Amounts incurred for repairs and maintenance are charged to operations in the period incurred. Depreciation is calculated on a straight-line basis over the following useful lives:</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>


<table border="0" cellspacing=0 cellpadding=0 width="287" style='margin-left:1.0in;border-collapse:collapse'>
    <tr >
        <td width="209" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Equipment  </font></p> </td>
        <td width="77" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>3-5 years</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>


<table border="0" cellspacing=0 cellpadding=0 width="287" style='margin-left:1.0in;border-collapse:collapse'>
    <tr >
        <td width="209" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Furniture and fixtures  </font></p> </td>
        <td width="77" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>5-7 years</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>


<table border="0" cellspacing=0 cellpadding=0 width="295" style='margin-left:1.0in;border-collapse:collapse'>
    <tr >
        <td width="209" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Leasehold improvements  </font></p> </td>
        <td width="85" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>5-10 years</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>


<table border="0" cellspacing=0 cellpadding=0 width="287" style='margin-left:1.0in;border-collapse:collapse'>
    <tr >
        <td width="209" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Software  </font></p> </td>
        <td width="77" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>2-5 years</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><u><font size=2>Goodwill and Intangible Assets</font></u></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>Intangible assets at August 31, 2007 relates to the assets acquired in the Artisanal Acquisition (See Note 2 &#150; Acquisition) and will be allocated to specific items upon an analysis to be performed. </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font SIZE=2>F-6</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>
<pAGE>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>The Company reviews long-lived assets, certain identifiable assets and any impairment related to those assets at least annually or whenever circumstances and situations change such that there is an indication that the carrying amounts may not be recoverable. To the extent carrying values have exceeded fair values, an impairment loss has been recognized in operating results.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><u><font size=2>Revenue Recognition</font></u></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>The Company recognizes revenues associated with the sale of its products at the time of delivery to customers.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><u><font size=2>Shipping and Handling Costs</font></u></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>Shipping and handling costs are included in cost of sales</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><u><font size=2>Advertising Costs</font></u><font size=2> </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>All advertising costs are expensed as incurred. Advertising expenses charge to operations for the three months ended August 31, 2007 was approximately $4,702. </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><u><font size=2>Interest Income/(Expense)</font></u></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>Interest expense relates
to interest owed on the Company&#146;s debt. Interest expense is recognized over
the period the debt is outstanding at the stated interest rates (see Note 12).
</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><u><font size=2>Income Taxes</font></u></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>Income taxes have been provided using the liability method. Deferred tax assets and liabilities are determined based on differences between the financial reporting and tax basis of assets and liabilities and are measured by applying estimated tax rates and laws to taxable years in which such differences are expected to reverse. The deferred tax asset attributed to the net operating</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>losses has been fully reserved, since the Company has yet to achieve recurring income from operations.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:justify;'><u><font size=2>Use of Estimates</font></u><font size=2>  </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>The preparation of financials statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the reporting period.  Actual results could differ from those estimates.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><u><font size=2>Stock-based Compensation</font></u></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>The Company accounts for stock-based compensation in accordance with SFAS No. 123-R Share-Based Payment (&#147;SFAS No. 123-R&#148;). The Company records compensation expense using a fair-value-based measurement method for all awards granted.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font SIZE=2>F-7</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>
<pAGE>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><u><font size=2>Net Income/(Loss) Per Share</font></u></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>In accordance with SFAS No. 128, &#147;Earnings Per Share&#148;, basic net income/(loss) per share is computed using the weighted average number of common shares outstanding during each period. There were no common stock equivalents for the quarter ended August 31, 2006.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><u><font size=2>Fair Value of Financial Instruments</font></u></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>The carrying amounts of financial instruments, including cash and cash equivalents, marketable securities, accounts receivable, notes receivable, and accounts payable, approximated fair value as of August 31, 2007, because of the relatively short-term maturity of these instruments and their market interest rates. Since a portion of long-term debt is in default, it is not possible to estimate its value.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><u><font size=2>Segment Disclosure</font></u></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>Management believes the Company operates as one segment.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><u><font size=2>Recent Accounting Pronouncements</font></u></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>

In February 2007, the Financial Accounting Standards Board (the
&#147;FASB&#148;) issued SFAS No. 159, &#147;The Fair Value Option for Financial
Assets and Financial Liabilities&#148; (&#147;SFAS No. 159&#148;). SFAS No. 159
permits entities to choose, at specified election dates, to measure eligible
items at fair value (the &#147;fair value option&#148;). A business entity shall
report unrealized gains and losses on items for which the fair value option has
been elected in earnings at each subsequent reporting date. The objective is to
improve financial reporting by providing entities with the opportunity to
mitigate volatility in reported earnings caused by measuring related assets and
liabilities differently without having to apply complex hedge accounting
provisions. SFAS No. 159 is effective as of the beginning of an entity&#146;s
first fiscal year that begins after November 15, 2007. Early adoption is permitted as of the beginning of a fiscal year that
begins on or before November 15, 2007, provided the entity also elects to apply
the provisions of SFAS No. 157, &#147;Fair Value Measurements&#148; (&#147;SFAS
No. 157&#148;). Management is in the process of assessing if this statement will
have a material impact on the Company&#146;s financial statements once
adopted.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>

In September 2006, the FASB issued SFAS No. 157. SFAS No.157 defines fair value,
establishes a framework for measuring fair value in generally accepted
accounting principles, and expands disclosures about fair value measurements.
This Statement applies under other accounting pronouncements that require or
permit fair value measurements, the FASB having previously concluded in those
accounting pronouncements that fair value is a relevant measurement attribute.
Accordingly, this Statement does not require any new fair value measurements.
However, for some entities, the application of this Statement will
change current practices. This Statement is effective for financial statements for
fiscal years beginning after November 15, 2007. Early adoption is permitted
provided that the reporting entity has not yet issued financial statements for
that fiscal year. Management is in the process of assessing if this statement
will have a material impact on the Company&#146;s financial statements once
adopted.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font SIZE=2>F-8</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>
<pAGE>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>


<table border="0" cellspacing=0 cellpadding=0 width="256" style='border-collapse:collapse'>
    <tr >
        <td width="48" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>4.</font></p> </td>
        <td width="208" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><u><font SIZE=2>ACCOUNTS RECEIVABLE</font></u></p> </td> </tr></table>

<BR>


<table border="0" cellspacing=0 cellpadding=0 width="480" style='margin-left:.5in;border-collapse:collapse'>
    <tr >
        <td width="480" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Accounts receivable are comprised of the following at August 31, 2007:</font></p> </td> </tr></table>

<BR>


<table width=600 border=0 cellpadding=0 cellspacing=0>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td width=10% align=LEFT>&nbsp;</td>
    <td width=59% align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Trade
      accounts receivable</font></td>
    <td width=1% align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td width=3% align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td width=1% align=RIGHT><font face="Times New Roman" size=2>$</font></td>
    <td width=14% align=RIGHT><font face="Times New Roman" size=2> 293,256</font></td>
    <td width=12% align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Employees</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>2,547</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr>
    <td colspan=4></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Allowance
      for doubtful accounts</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>(8,795</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>)</font></td>
  </tr>
  <tr>
    <td colspan=4></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=2></td>
    <td></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>$</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2> 287,008</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr>
    <td colspan=4></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=2></td>
    <td></td>
  </tr>
</table>



<BR>


<table border="0" cellspacing=0 cellpadding=0 width="172" style='border-collapse:collapse'>
    <tr >
        <td width="48" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>5.</font></p> </td>
        <td width="124" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><u><font SIZE=2>INVENTORIES</font></u></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in; text-indent:-0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;border-left:solid 0pt;padding-left:0;border-right:solid 0pt;padding-right:0;border-top:solid 0pt;padding-top:0;'><font size=2>Inventories are valued on a first-in-first-out (FIFO) basis.  Inventory at August 31, 2007 consisted of the following::</font></p>

<BR>


<table width=600 border=0 cellpadding=0 cellspacing=0>
  <tr valign=Bottom bgcolor="#Eaf9e8">
    <td width="10%" align=LEFT>&nbsp;</td>
    <td width="59%" align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cheese
      Inventory</font></td>
    <td width="1%" align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td width="3%" align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td width="1%" align=RIGHT><font face="Times New Roman" size=2>$</font></td>
    <td width="14%" align=RIGHT><font face="Times New Roman" size=2> 140,697</font></td>
    <td width="12%" align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Shipping/Packing
      Material Inventory</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>54,298</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr valign=Bottom bgcolor="#Eaf9e8">
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accessories
      &amp; Books Inventory</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>8,480</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr>
    <td colspan=4></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>$</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2> 203,475</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr>
    <td colspan=4></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=2></td>
    <td></td>
  </tr>
</table>

<BR>

<table border="0" cellspacing=0 cellpadding=0 width="217" style='border-collapse:collapse'>
    <tr >
        <td width="48" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>6.</font></p> </td>
        <td width="169" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><u><font SIZE=2>PREPAID EXPENSES</font></u></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>At August 31, 2007, the Company&#146;s had prepaid expenses of $35,175, which consisted primarily of prepaid real estate taxes and workers&#146; compensation insurance.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>


<table border="0" cellspacing=0 cellpadding=0 width="176" style='border-collapse:collapse'>
    <tr >
        <td width="48" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>7.</font></p> </td>
        <td width="128" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><u><font SIZE=2>FIXED ASSETS</font></u></p> </td> </tr></table>

<BR>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;border-left:solid 0pt;padding-left:0;border-right:solid 0pt;padding-right:0;padding-top:0;'><font size=2>Fixed assets are valued at net book value at the date of the Artisanal Acquisition which approximates fair market value.  Fixed assets are comprised of the following at August 31, 2007:</font></p>

<BR>

<table cellpadding=0 cellspacing=0 border=0 width=600>
  <tr valign=Bottom bgcolor="#Eaf9e8">
    <td width="10%" align=LEFT bgcolor="#Eaf9e8">&nbsp;</td>
    <td width="59%" align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Furniture
      and fixtures</font></td>
    <td width="1%" align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td width="3%" align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td width="1%" align=RIGHT><font face="Times New Roman" size=2>$</font></td>
    <td width="14%" align=RIGHT><font face="Times New Roman" size=2> 155,252</font></td>
    <td width="12%" align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Kitchen
      Equipment</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>253,392</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr valign=Bottom bgcolor="#Eaf9e8">
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Computer
      Equipment</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>95,869</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Software
      &amp; Web Design</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>5,279</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr valign=Bottom bgcolor="#Eaf9e8">
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Design
      Fees</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>51,539</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Leasehold
      Improvement</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>1,077,588</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr>
    <td colspan=4></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
  </tr>
  <tr valign=Bottom bgcolor="#Eaf9e8">
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>1,638,919</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Less:
      Accumulated<br>
      &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation
      &amp; Amortization</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>(803,945</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>)</font></td>
  </tr>
  <tr>
    <td colspan=4></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=1></td>
    <td></td>
  </tr>
  <tr valign=Bottom bgcolor="#Eaf9e8">
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>$</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2> 834,974</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr>
    <td colspan=4></td>
    <td colspan=2 align=RIGHT><hr noshade color=black size=2></td>
    <td></td>
  </tr>
</table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2> </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font SIZE=2>F-9</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>
<pAGE>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>


<table border="0" cellspacing=0 cellpadding=0 width="205" style='border-collapse:collapse'>
    <tr >
        <td width="48" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>8.</font></p> </td>
        <td width="157" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><u><font SIZE=2>NOTES PAYABLES</font></u></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>

Notes payable consist of the following:</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>
Note payable to a former Artisanal shareholder for $228,000 payable in one year
with payments due quarterly of $57,000 per quarter without interest, payable in
product to one or more of the former shareholder&#146;s restaurant establishments.
</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>Note payable to a former Artisanal shareholder for $700,000.  The principal is due and payable in full on November 14, 2007. The note is non-interest bearing and secured by a first priority security interest in all assets of the Company.  The note holder&#146;s prior written consent is required with respect to any debt financing that the Company may secure for purposes of paying off this note.  </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>
Notes payable also includes a $5,000 note to a shareholder. The terms of the
note call for no principal payments and for interest to accrue at the rate of
10% per annum. Principal and interest are due and payable on or before October
17, 2007. This note was repaid in September 2007.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>


<table border="0" cellspacing=0 cellpadding=0 width="317" style='border-collapse:collapse'>
    <tr >
        <td width="48" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>9.</font></p> </td>
        <td width="269" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><u><font SIZE=2>LOANS PAYABLE SHAREHOLDER</font></u></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>Over the last few years, the Company&#146;s current president, Daniel W. Dowe, has loaned money to the Company to assist with its operating cash flow.  Mr. Dowe has entered into an agreement with the Company&#146;s board of directors to have the loan repaid without interest.  There is no agreement between the board of directors and Mr. Dowe to repay the loan on a specific date, but only when the Company has adequate cash on hand.  </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>


<table border="0" cellspacing=0 cellpadding=0 width="548" style='border-collapse:collapse'>
    <tr >
        <td width="48" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>10.</font></p> </td>
        <td width="500" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><u><font SIZE=2>PREPAID GIFT CERTIFICATES AND OTHER DEFERRED REVENUE</font></u></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>The
Company records cash received in advance of the delivery of products or services
as deferred revenue until the products are delivered to customers or the
services are provided. Gift certificates are issued for a one-year period at
which time the certificate expires. The Company has not recorded any income for
expired or unused gift certificates.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>


<table border="0" cellspacing=0 cellpadding=0 width="495" style='border-collapse:collapse'>
    <tr >
        <td width="48" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>11.</font></p> </td>
        <td width="447" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><u><font SIZE=2>ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES</font></u></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:1in; text-indent:-0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>Accrued
expenses consist primarily of accrued accounting expenses of $34,000, $60,000
worth of non-recurring consulting fees relating to the closing of Artisanal and
about $11,000 of accrued other miscellaneous expenses. Approximately $53,000 of
accrued expenses is attributable to payable reductions. </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:1in; text-indent:-0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>


<table border="0" cellspacing=0 cellpadding=0 width="223" style='border-collapse:collapse'>
    <tr >
        <td width="48" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>12.</font></p> </td>
        <td width="175" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><u><font SIZE=2>ACCRUED INTEREST</font></u></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:1in; text-indent:-0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>Accrued interest of $86,458 represents the interest owing on the Quilcap debenture.  (See Note 15 - Long Term Debt). </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font SIZE=2>F-10</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>
<pAGE>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>


<table border="0" cellspacing=0 cellpadding=0 width="276" style='border-collapse:collapse'>
    <tr >
        <td width="48" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>13.</font></p> </td>
        <td width="228" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><u><font SIZE=2>ACCRUED PAYROLL TAXES</font></u></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>The Company prior to the acquisition of Artisanal remains in arrears with paying payroll taxes of approximately $652,000.  The Company is currently negotiating a payment program with the relevant tax authorities. </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>


<table border="0" cellspacing=0 cellpadding=0 width="185" style='border-collapse:collapse'>
    <tr >
        <td width="48" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>14.</font></p> </td>
        <td width="137" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><u><font SIZE=2>INCOME TAXES</font></u></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>At August 31, 2007,
the Company has available unused net operating loss carryforward
(&#147;NOL&#148;) of approximately $8,300,000 that may be applied against future
taxable income and expire at various dates through 2025. The Company has a
deferred tax asset arising from such net operating loss deductions and has
recorded a valuation allowance for the full amount of such deferred tax asset
since the likelihood of realization of the tax benefits cannot be determined.
Such valuation allowance has decreased approximately $120,000 during
2007.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>




<table cellpadding=0 cellspacing=0 border=0 width=600>
  <tr valign=Bottom>
    <th colspan=4><font face="Times New Roman" size=2> </font></th>
    <td colspan=2 align="center"><font face="Times New Roman" size=2>2007 </font>
      <hr width=100% size=1 color=BLACK noshade></td>
    <th>&nbsp;</th>
  </tr>
  <tr valign=Bottom>
    <td width=10% align=LEFT>&nbsp;</td>
    <td width=60% align=LEFT><font face="Times New Roman" size=2>Deferred tax
      asset: </font></td>
    <td width=1% align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td width=1% align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td width=1% align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td width=15% align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td width=12% align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net
      operating loss carryforward </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>$ </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2> 2,900,000 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Valuation
      allowance </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>(2,900,000 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>) </font></td>
  </tr>
  <tr>
    <td colspan=4></td>
    <td colspan=2 align=RIGHT><hr noshade color=#000000 size=1></td>
    <td></td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT><font face="Times New Roman" size=2>Net deferred tax asset
      </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>$ </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2> &#151; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr>
    <td colspan=4></td>
    <td colspan=2 align=RIGHT><hr noshade color=#000000 size=2></td>
    <td></td>
  </tr>
</table>


<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>A reconciliation of the statutory federal income (tax) benefit to actual tax benefit is as follows:</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>


<table cellpadding=0 cellspacing=0 border=0 width=600>
  <tr valign=Bottom>
    <th colspan=2><font face="Times New Roman" size=1> </font></th>
    <td colspan=2 align="center"><font face="Times New Roman" size=2>2007 </font>
      <hr width=100% size=1 color=BLACK noshade></td>
    <td align="center">&nbsp;</td>
    <td colspan=2 align="center"><font face="Times New Roman" size=2>2006 </font>
      <hr width=100% size=1 color=BLACK noshade></td>
    <th>&nbsp;</th>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td width=8% align=LEFT>&nbsp;</td>
    <td width=51% align=LEFT><font face="Times New Roman" size=2>Statutory federal
      income (tax) benefit </font></td>
    <td width=1% align=RIGHT><font face="Times New Roman" size=2>$ </font></td>
    <td width=12% align=RIGHT><font face="Times New Roman" size=2> (120,000 </font></td>
    <td width=5% align=LEFT><font face="Times New Roman" size=2>) </font></td>
    <td width=1% align=RIGHT><font face="Times New Roman" size=2>$ </font></td>
    <td width=12% align=RIGHT><font face="Times New Roman" size=2> 24,000 </font></td>
    <td width=10% align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT><font face="Times New Roman" size=2>Income tax benefit utilized
      (not utilized) </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>120,000 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>(24,000 </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>) </font></td>
  </tr>
  <tr>
    <td colspan=2></td>
    <td colspan=2 align=RIGHT><hr noshade color=#000000 size=1></td>
    <td></td>
    <td colspan=2 align=RIGHT><hr noshade color=#000000 size=1></td>
    <td></td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT><font face="Times New Roman" size=2>Actual tax benefit </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>$ </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2> &#151; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>$ </font></td>
    <td align=RIGHT><font face="Times New Roman" size=2> &#151; </font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp; </font></td>
  </tr>
  <tr>
    <td colspan=2></td>
    <td colspan=2 align=RIGHT><hr noshade color=#000000 size=2></td>
    <td></td>
    <td colspan=2 align=RIGHT><hr noshade color=#000000 size=2></td>
    <td></td>
  </tr>
</table>


<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>
If the Company has a greater than 50% change in ownership of certain stock
holdings by shareholders of the Company pursuant to Section 382 of the Internal
Revenue Code, the net operating losses may be limited. Currently no such
evaluation has been performed. As a result of the Artisanal Acquisition
described above, the Company is reviewing whether its ability to utilize its net
operating loss carryovers may be restricted based on Internal Revenue Code
Section 382 &#147;changes in ownership.&#148;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'>
</p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font SIZE=2>F-11</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>
<pAGE>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>


<table border="0" cellspacing=0 cellpadding=0 width="205" style='border-collapse:collapse'>
    <tr >
        <td width="48" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>15.</font></p> </td>
        <td width="157" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><u><font SIZE=2>LONG TERM DEBT</font></u></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>Long-term debt consists of the following:</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=1>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></p>


<table cellpadding=0 cellspacing=0 border=0 width=600>
  <tr valign=Bottom>
    <th colspan=3><font face="Times New Roman" size=1></font></th>
    <th colspan=3><font face="Times New Roman" size=1></font></th>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td width=16% align=LEFT>&nbsp;</td>
    <td width=60% align=LEFT><font face="Times New Roman" size=2>Debenture payable
      (a)</font></td>
    <td width=1% align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td width=1% align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td width=10% align=RIGHT><font face="Times New Roman" size=2>125,000</font></td>
    <td width=12% align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT><font face="Times New Roman" size=2>Artisanal Sellers&#146; Notes
      (b)</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>500,000</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT><hr noshade color=#000000 size=1></td>
    <td></td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>625,000</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr valign=Bottom>
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT><font face="Times New Roman" size=2>Less: Current portion</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>(125,000</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>)</font></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT><hr noshade color=#000000 size=1></td>
    <td></td>
  </tr>
  <tr valign=Bottom bgcolor="#eaf9e8">
    <td align=LEFT>&nbsp;</td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2>$</font></td>
    <td align=RIGHT><font face="Times New Roman" size=2> 500,000</font></td>
    <td align=LEFT><font face="Times New Roman" size=2>&nbsp;</font></td>
  </tr>
  <tr>
    <td colspan=3></td>
    <td colspan=2 align=RIGHT><hr noshade color=#000000 size=2></td>
    <td></td>
  </tr>
</table>


<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>


<table  border="0" cellspacing=0 cellpadding=0 style='margin-left:.5in;border-collapse:collapse'>
    <tr >
        <td width="48" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>a.</font></p> </td>
        <td  valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>The Company is
currently in default on a $125,000 debenture due a stockholder of the company,
Quilcap, Corp., in the amount of $125,000. This debenture from February 25,
1999, bears interest at 15% per annum and matured on May 31, 1999. The Company
is currently negotiating with the debenture holder.</font></p> </td>
</tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>


<table  border="0" cellspacing=0 cellpadding=0 style='margin-left:.5in;border-collapse:collapse'>
    <tr >
        <td width="48" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>b.</font></p> </td>
        <td  valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>
In connection with the acquisition of Artisanal Cheese, LLC, the Company
obtained two sellers&#146; notes--one from each of the former members of
Artisanal Cheese, LLC. The notes are for $130,000 and $370,000, respectively.
The note for $130,000 bears interest at 5% per annum and is payable in
consecutive monthly payments of principal and interest in the amount of
$3,896.22 commencing November 1, 2007. All principal and accrued interest shall
be due and payable in full on October 1, 2010. The note for $370,000 bears
interest at 5% per annum and is payable in consecutive monthly payments of
principal and interest in the amount of $11,089.23 commencing November 1, 2007.
All principal and accrued interest shall be due and payable in full on October
1, 2010. Both notes are secured pursuant to a Security Agreement pursuant to
which the note holders have a first priority security interest in all assets of
the Company except that the note holders have agreed to subordinate their
security interest on those assets so that the Company may obtain asset-based
debt financing.</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>In August 2007, two secured creditors holding notes in the amounts of $1,120,958 and $400,000 agreed to convert the outstanding principal of their respective notes, together with accrued interest of $674,229, into 1,950,000 shares of the Company&#146;s common stock.   </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>


<table border="0" cellspacing=0 cellpadding=0 width="261" style='border-collapse:collapse'>
    <tr >
        <td width="48" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>16.</font></p> </td>
        <td width="213" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><u><font size=2>SHAREHOLDERS&#146; EQUITY</font></u></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:justify;'><u><font size=2>Terms of Preferred Stock</font></u></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>The Company sold 3,900,000 shares of redeemable convertible preferred stock at a price of $1.00 per share for a total gross proceeds of $3,900,000.  The preferred stock is convertible at $.30 per share into $.001 par value Common Stock of Company, (equaling 60% of the issued and outstanding Common Stock of the Company on a fully diluted basis, excluding the Management Stock Option (see below)).  Dividends shall be paid (a) 12% Paid-in-Kind in first two years from Closing Date, and (b) 12% Paid-In-Cash after the first two years from Closing or 15% Paid-In-Kind, at the election of the Company.  These dividends shall convert into Common Stock at $.30 per share, unless the Company elects to pay dividends in cash pursuant </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font SIZE=2>F-12</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>
<pAGE>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>to (b) above.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>
At any time prior to the third anniversary of the Closing Date and upon 30 days
advance notice, the Company shall have the right to redeem one-half of the
Preferred Stock that is issued and outstanding at the Closing by paying the
Holder the </font><u><font size=2>full</font></u><font size=2> par value of the
Preferred Stock $1.00 per share plus accrued dividends in cash (the &#147;First
Redemption&#148;). The remaining one-half of the Preferred Stock that is issued
and outstanding after the First Redemption can either be: (a) redeemed by the
Company in cash at par value, plus accrued dividends with the Holder also
receiving a 2-year option to acquire 5% of the issued and outstanding Common
Stock of the Company at an exercise price of $.30 per share, or, (b) converted
into 30% of the issued and outstanding Common Stock of the Company (the
&#147;Second Redemption&#146;). The Holder shall have sole authority to elect
subsection (a) or (b) above upon receiving a Redemption Notice. Any Common Stock
or Common Stock Option issued pursuant to the First Redemption or the Second
Redemption shall be on a fully-diluted basis, excluding the Management Stock
Option below. The Company intends to sell an additonal $1.3 million of Preferred
Stock, under the same terms. As of the date of this filing,  the Company is in
negotiations with several prospective investors.
</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>The Company has agreed to file a registration statement with respect to the number of shares of its Common Stock necessary to enable all Holders to have  resale rights in the Common Stock underlying their Preferred Stock if and when converted, or upon a redemption payable in Common Stock.  All costs of the registration shall be borne by the Company.  </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>So long as over $1,500,000 of the Preferred Stock is issued and outstanding the Company shall require the prior written consent of Holders representing 2/3 of the Preferred Stock issued and outstanding to (a) sell, merge with, acquire or consolidate with another business entity, (b) incur additional leverage beyond the leverage contemplated by the Company and Holders as part of the Company&#146;s acquisition of Artisanal Cheese, LLC, or (c) issue any new shares of common stock or securities convertible or exercisable into Common Stock in excess of 2% of the shares of Common Stock issued and outstanding on a fully diluted basis at the Closing, excluding the Management Stock Option.  </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><u><font size=2>Preferred Stock Issuances</font></u></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>In August 2007, several private investors made an equity investment of $3,900,000 for which these investors received 3,900,000 shares of the Company&#146;s redeemable convertible preferred stock. The proceeds were used to acquire the membership interests of a specialty food company.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>In August 2007, the Company issued 15,000 shares of redeemable convertible preferred stock in exchange for consulting services.  The company recorded an expense of $15,000 in connection with these shares.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><u><font size=2>Common Stock Issuances</font></u></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>In January 2006, the Company and a judgment creditor reached an agreement whereby the creditor agreed to refrain from enforcing its judgment in exchange for a monthly payment of interest on the </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font SIZE=2>F-13</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>
<pAGE>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>creditor&#146;s original loan to the Company and the Company&#146;s commitment to pay the judgment upon the earlier of the recapitalization of the Company or September 30, 2006.  Through subsequent amendments to the agreement, the date was extended to August 2007.  In August 2007, the creditor agreed to convert the outstanding judgment of $400,000 into 450,000 shares of the Company&#146;s common stock of which 400,000 shares would be held in escrow and liquidated for purposes of repaying the $400,000 judgment.  The Company recorded additional paid-in capital of $399,600 for the 400,000 shares and an interest expense of $15,000 in connection with the remaining 50,000 shares.  The creditor also received $16,666 representing interest.  </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>In August 2007, two secured creditors agreed to convert the outstanding principal and interest of their respective notes totaling approximately $2,000,684 into 1,675,000 shares of the Company&#146;s common stock   The Company recorded additional paid-in capital of $1,999,009 with respect to these shares.  </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>In August 2007, several of the Company&#146;s judgment creditors agreed to accept $91,903 in cash and a total of 166,194 shares of common stock in exchange for satisfactions of their respective claims totaling approximately $411,125.  As a result of these settlements, the Company reduced its accounts payable by $161,327.85, increased paid-in capital by approximately $130,000 and reduced the gain on sale by approximately $60,000. </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>In August 2007, the Company issued 25,000 shares of common stock in exchange for consulting services.  The company recorded an expense of $7,500 in connection with these shares.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><u><font size=2>Stock Option </font></u><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;
margin-left:0.5in;text-align:left;'><font size=2>At the closing, Daniel W. Dowe
and William Feeney were granted a 5-year Stock Option at an exercise price of
$.30 per share that is exercisable into 12% and 8%, respectively, of the Common Stock of the Company
on a fully-diluted basis. The Stock Option was fully-vested at the Closing Date,
but not exercisable until the Company achieves: (a) $21.6 million in revenue or
$2 million in EBITDA in a full calendar year by no later than Calendar Year
2009, and, (b) the First Redemption is concluded by the Company. The failure to
meet either of these conditions shall cause the entire Management Stock Option
to terminate in its entirety. An expense will be recorded once
these shares become exercisable and the contingency has been
resolved.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:1in; text-indent:-0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>


<table border="0" cellspacing=0 cellpadding=0 width="364" style='margin-left:0pt;border-collapse:collapse'>
    <tr >
        <td width="53" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>17.</font></p> </td>
        <td width="311" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><u><font SIZE=2>DISPOSITION OF ASSETS INTANGIBLES</font></u></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>Intangibles arose in connection with the acquisitions of Arm Pro in September 1998, and with the acquisition of Allied / Por-Rok lines in August 1999 and Sta-Dri in August 2000.  The intangible assets were re-characterized pursuant to SFAS 142 from &#147;Goodwill&#148; to be &#147;Intangibles&#148;, since such intangibles are actually comprised of trademarks, acquired proprietary technology and customer lists.  We have attributed the cost of these intangibles to be $606,164 for trademarks, $75,771 for proprietary technology and $75,771 for customer lists.  These intangibles were being amortized over a fifteen-year life on a straight-line basis. The Company sold these intangibles on August 15, 2007. On that date, the accumulated amortization was $375,580.  </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font SIZE=2>F-14</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>
<pAGE>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>On August 15, 2007, the Company sold all of its intangible property relating to the building material business to GT Holding, LLC (&#147;GTH&#148;).  In exchange for these assets, the Company received $850,000 in cash and GTH assumed approximately $73,000 of the Company&#146;s liabilities.  The Company had carried these intangibles at a net value of $382,126 and, thus, recorded a gain on sale of $540,874. See Note 16 for other costs against the gain on sale of intangibles.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:1in; text-indent:-0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>



<table border="0" cellspacing=0 cellpadding=0 width="357" style='border-collapse:collapse'>
  <tr >
    <td width="48" valign=top > <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>18.</font></p></td>
    <td width="309" valign=top > <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><u><font size=2>COMMITMENTS
        AND CONTINGENCIES</font></u></p></td>
  </tr>
</table>
<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:1in; text-indent:-0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>
<table border="0" cellspacing=0 cellpadding=0 width="564" style='margin-left:.5in;border-collapse:collapse'>
  <tr >
    <td width="144" valign=top > <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><u><font size=2>Term</font></u></p></td>
    <td width="288" valign=top > <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><u><font size=2>Agreement</font></u></p></td>
    <td width="132" valign=top > <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><u><font size=2>Monthly
        Expense</font></u></p></td>
  </tr>
</table>
<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:1in; text-indent:-0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>
<table border="0" cellspacing=0 cellpadding=0 width="524" style='margin-left:.5in;border-collapse:collapse'>
  <tr bgcolor="#eaf9e8" >
    <td width="144" valign=top >
      <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>8/15/07
        &#150; 12/15/07</font></p></td>
    <td width="288" valign=top >
      <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Transitional
        Services Agreement<br>
        Comptroller services (a) </font></p></td>
    <td width="92" valign=top >
      <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>$
        3,500.00</font></p></td>
  </tr>
</table>
<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:1in; text-indent:1in;text-align:justify;'><font size=2>&nbsp;</font></p>
<table border="0" cellspacing=0 cellpadding=0 width="524" style='margin-left:.5in;border-collapse:collapse'>
  <tr >
    <td width="144" valign=top > <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>8/15/07
        &#150; 8/14/08</font></p></td>
    <td width="288" valign=top > <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Transitional
        Services Agreement<br>
        Equipment services (a) </font></p></td>
    <td width="92" valign=top > <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>$23,700.00</font></p></td>
  </tr>
</table>
<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:1in; text-indent:1in;text-align:justify;'><font size=2>&nbsp;</font></p>
<table border="0" cellspacing=0 cellpadding=0 width="524" style='margin-left:.5in;border-collapse:collapse'>
  <tr bgcolor="#eaf9e8" >
    <td width="144" valign=top >
      <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>8/15/07
        &#150; 7/31/08</font></p></td>
    <td width="288" valign=top >
      <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Consulting
        Agreement (b)</font></p></td>
    <td width="92" valign=top >
      <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>$
        4,333.33</font></p></td>
  </tr>
</table>
<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:1in; text-indent:-0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>
<table border="0" cellspacing=0 cellpadding=0 width="471" style='margin-left:.5in;border-collapse:collapse'>
  <tr >
    <td width="144" valign=top > <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>8/15/07
        &#150; 8/14/12</font></p></td>
    <td width="288" valign=top > <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Preferred
        Vendor Agreement (c)</font></p></td>
    <td width="39" valign=top > <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>n/a</font></p></td>
  </tr>
</table>
<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:1in; text-indent:-0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>
<table border="0" cellspacing=0 cellpadding=0 width="471" style='margin-left:.5in;border-collapse:collapse'>
  <tr bgcolor="#eaf9e8" >
    <td width="144" valign=top >
      <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>8/15/07
        &#150; 8/14/12</font></p></td>
    <td width="288" valign=top >
      <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Product
        Development Agreement (d)</font></p></td>
    <td width="39" valign=top >
      <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>n/a</font></p></td>
  </tr>
</table>
<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:1in; text-indent:-0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>
<table border="0" cellspacing=0 cellpadding=0 width="471" style='margin-left:.5in;border-collapse:collapse'>
  <tr >
    <td width="144" valign=top > <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>8/15/07
        &#150; 8/14/12</font></p></td>
    <td width="288" valign=top > <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Trademark
        Assignment (e)</font></p></td>
    <td width="39" valign=top > <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>n/a</font></p></td>
  </tr>
</table>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:1in; text-indent:-0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:1in; text-indent:-0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>


<table  border="0" cellspacing=0 cellpadding=0 style='margin-left:.5in;border-collapse:collapse'>
    <tr >
        <td width="24" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>a.</font></p> </td>
        <td  valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>The Company has entered into a Transitional Services Agreement with Artisanal Group, LLC, a company owned by the former member of Artisanal Cheese, LLC, to provide equipment services for equipment leased by Artisanal Group for varying periods of up to three years, non-equipment services for no more than one year and comptroller services for a period of four months from the date of acquisition.  The equipment services include telephones, computers, photocopiers, presentation equipment and delivery trucks and the non-equipment services encompass health, liability and auto insurances.</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>


<table  border="0" cellspacing=0 cellpadding=0 style='margin-left:.5in;border-collapse:collapse'>
    <tr >
        <td width="24" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>b.</font></p> </td>
        <td  valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>The Company has entered into a one-year Consulting Agreement with executive chef, Terrence Brennan, the founder of Artisanal Cheese LLC and owner of two Manhattan restaurants, Picholine and Artisanal Bistro &amp; Fromagerie, to provide consulting services including advice on product mix, marketing plans in the retail sector and presentation to retail supermarket buyers.  Mr. Brennan shall receive $13,000 every quarter for 24 hours worth of consulting services during each three month period.  The agreement also provides for a finder&#146;s fee of $10,000 in connection with any supply or sales agreement between the Company and any strategic partner introduced to the Company by Mr. Brennan, with an additional payment of $20,000 if sales to the strategic partner exceed $500,000 in the aggregate.  The Consulting Agreement also provides for office space for Mr. Brennan
and two of his staff members at the Company&#146;s principal offices located at 500 West 37</font><sup><font size=2>th</font></sup><font size=2> Street, New York, New York.   </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font SIZE=2>F-15</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>
<pAGE>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>


<table  border="0" cellspacing=0 cellpadding=0 style='margin-left:.5in;border-collapse:collapse'>
    <tr >
        <td width="24" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>c.</font></p> </td>
        <td  valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>
The Company has entered into a five-year Preferred Vendor Agreement with two
restaurant establishments owned by the former member of Artisanal Cheese, LLC,
pursuant to which the Company will supply the restaurants or their affiliates
with any and all premium cheese products at a high volume discount and at prices
not to exceed prices offered to other customers, and the restaurants must
purchase exclusively from the Company provided the Company can meet terms and
conditions (e.g. quantities and time of delivery) acceptable to the restaurants.
The Preferred Vendor Agreement also provides for a credit to the restaurant
establishments which credit shall be applied to the first $228,000 worth of
product, not to exceed $57,000 in any calendar quarter. This credit is the
result of the payoff in full at the closing of Artisanal by one of its former
members of a certain loan to the Company. (See Note 8 &#150; Notes
Payable).</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>


<table  border="0" cellspacing=0 cellpadding=0 style='margin-left:.5in;border-collapse:collapse'>
    <tr >
        <td width="24" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>d.</font></p> </td>
        <td  valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>The Company has entered into a five-year Product Development Agreement pursuant to which the Company shall have a &#147;first-look&#148; right and 30-day exclusivity period to evaluate and negotiate in good faith a distribution arrangement (including minimum orders, exclusivity, prices/royalty rates and terms) for all new cheeses, cheese related products and other products developed by the two restaurant establishments owned by the former member of Artisanal Cheese, LLC.  After the 30-day exclusivity period, the Company will have an opportunity to match any terms and conditions of a distribution agreement that the restaurants may subsequently reach with a third party.  The Agreement provides for a written trademark license from the Company to the restaurants upon terms to be mutually agreed upon with respect to any distribution by the restaurants under the
Artisanal brand of such new products other than distribution by the Company.</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>


<table  border="0" cellspacing=0 cellpadding=0 style='margin-left:.5in;border-collapse:collapse'>
    <tr >
        <td width="24" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>e.</font></p> </td>
        <td  valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>The Company has entered into a Trademark License Agreement pursuant to which the Company grants a royalty-free license to the two restaurant establishments to use the tradename &#147;Artisanal Fromagerie &amp; Bistro&#148; and the derivative logo (consisting of an oval design with four stylized sheep seated in front of a barn and the words &#147;Artisanal Fromagerie &#150; Bistro &#150; Wine Bar&#148;) in connection with the operation, distribution and sale of cheese, cheese products and other food products from the restaurant establishments or their affiliated restaurants or retail stores.  </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:1in; text-indent:-0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:1in; text-indent:-0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>


<table border="0" cellspacing=0 cellpadding=0 width="323" style='border-collapse:collapse'>
    <tr >
        <td width="48" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>19.</font></p> </td>
        <td width="275" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><u><font SIZE=2>RELATED PARTY TRANSACTIONS</font></u></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>The wife of Daniel W. Dowe, the Company&#146;s Chief Executive Officer and Chief Financial Officer, periodically provides legal and administrative services to the Company. In the three months ended August 31, 2007 Ms. Dowe received $25,000 for legal work in connection with the Artisanal Acquisition and $10,500 for other legal and administrative work for the Company. In the quarter ended August 31, 2006, Ms. Dowe received $10,500 for legal and administrative work performed for the Company.  </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>David A. Dowe who is the brother of Daniel W. Dowe has made loans to the company and has purchased common stock under the same terms and conditions as other non-affiliated investors that either loaned money to the company or purchased securities.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'>
</p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font SIZE=2>F-16</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>
<pAGE>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>In the quarter ended August 31, 2007, Daniel Dowe received 175,000 shares of the Company&#146;s common stock for payment of accrued and unpaid wages.  </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>With respect to the foregoing transactions, the Company believes that the terms of these transactions were as fair to the Company as could be obtained from an unrelated third party.  Future transactions with affiliates including loans will be on terms no less favorable than could be obtained from unaffiliated parties and will be approved by a majority of the independent disinterested members of the board of directors.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font SIZE=2>F-17</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>
<HR noshade align="center" width="100%" size="2">
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<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<A NAME="A005"></A>
<table border="0" cellspacing=0 cellpadding=0 width="469" style='border-collapse:collapse'>
    <tr >
        <td width="96" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Item 2. </font></b></p> </td>
        <td  colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Management&#146;s Discussion and Analysis of Financial </font></b></p> </td> </tr>
    <tr >
        <td  width="96">
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp; </font></td>
        <td width="269" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Condition and Results of Operations </font></b></p> </td>
        <td  width="104">
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp; </font></td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>The following discussion and analysis should be read in conjunction with the information contained in the Financial Statements and the Notes to the financial statements appearing elsewhere in this Form 10-QSB.  The Financial Statements for the three month period ending August 31, 2007, included in this Form 10-QSB are unaudited; however, this information reflects all adjustments (consisting solely of normal recurring adjustments), which are, in the opinion of management, necessary to present a fair statement of the results for the interim period.    </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><b><font size=2>Results of Operations  </font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:0.5in;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><b><font size=2>Three months ending August 31, 2007 vs. August 31, 2006 </font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>On August 15, 2007, the Company completed its acquisition of all the ownership interests in Artisanal Cheese, LLC. With this transaction, the Company sold its building material assets and recapitalized its existing debts primarily through a tax-free exchange of debt for equity and cash payments to satisfy other obligations.  Due to its expanded operations into the specialty food industry, the Company realized a significant increase in its revenues and costs versus the prior period even though the Company only owned this unit for two weeks during the fiscal quarter ending August 31, 2007. </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>In
the three month period ended August 31, 2007, the Company had sales and royalty
revenue of $219,150 versus $61,792 of royalty revenue in the corresponding three
month period in 2006. Cost of goods sold in this period was $112,060 which was
51% of gross revenues, versus 100% for the same period in 2006. Until it sold
its building material assets on August 15, 2007, the Company&#146;s gross margin
of 100% was attributable to the Company&#146;s conversion in February 2003 of
its manufacturing business into a licensing business. From February 2003 to
August 15, 2007, the Company maintained an exclusive licensing agreement with
CGM, Inc., whereby CGM fulfilled all orders for products sold under the trade
names that the Company owned and thereafter paid the Company a cash royalty on
sales. All royalty payments were based on actual sales in the previous month and
were paid on a monthly basis. The increase in cost of goods sold and general
operating expenses was attributable primarily to the acquisition of Artisanal
Cheese, LLC and the increase in sales of its new line of specialty foods.
</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>In this three
month period, the Company recorded a net loss from operations of $72,833 versus
$30,031 for the same period in 2006. The net gain to common shareholders during
this period 2007 was $352,358 versus a net loss of $70,584 during the same
period in 2006. The net gain was attributable primarily to the sale of the
Company&#146;s intangible assets relating to the building material business. The Company incurred $53,852 in interest charges. Of this
amount approximately $50,000 was attributable to interest on loans that were
converted into equity as part of the Artisanal transaction. The Company also
incurred $7,521 of amortization charges relating to the building material assets
which were sold on August 15, 2007. </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'>
</p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>1 </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>
<br>
<HR noshade align="center" width="100%" size="2">
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<pAGE>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>On August 31, 2007, the Company had $1,898,406 in current assets, which consisted primarily of cash of $1,372,748, inventory of $203,475 and accounts receivable of $287,008.  The Company&#146;s leasehold and equipment increased to $834,974 and intangibles increased to $3,857,229 net of amortization, which represents the goodwill and other intangibles which will be allocated pending the evaluation of the assets acquired.   </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><b><font size=2>Liquidity and Financial Resources at August 31, 2007 </font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>On August 15, 2007, the Company sold all of its intangible property relating to the building material business to GT Holding, LLC (&#147;GHT&#148;).  In exchange for these assets, the Company received $850,000 in cash and GTH assumed approximately $73,000 of the Company&#146;s liabilities.  The Company had carried these intangibles at a net value of $382,126 and, thus, recorded a gain on sale of $540,874.  (See Note 17 &#150; Disposition of Intangible Assets). </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>Also on August 15, 2007, three secured creditors agreed to convert the outstanding principal and interest of their respective notes totaling approximately $2,400,684 into 2,075,000 shares of the Company&#146;s common stock   Also, several of the Company&#146;s judgment creditors agreed to accept approximately $91,900 in cash and 166,195 shares of common stock in exchange for satisfactions of their respective judgments totaling approximately $269,168.  (See Note 16 &#150; Shareholders&#146; Equity &#150; Common Stock Issuances) </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>The Company undertook a $5.2 million private placement of redeemable convertible preferred stock.  By mid-August, the company had raised $3,900,000 of equity for which it issued 3,900,000 shares of preferred stock.  The Company used most of these funds to acquire the membership interests of Artisanal Cheese, LLC, for a purchase price of $4,400,000.  The members agreed to accept cash of $3,200,000 and sellers&#146; notes totaling $1,200,000.   </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:0.5in;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>
As of August 31, 2007, the Company had $2,568,566 in current liabilities, which
includes a seller&#146;s note for $700,000 relating to the acquisition of
Artisanal Cheese, LLC, and a $228,000 note providing for quarterly payments in
kind to one of the former shareholders&#146; restaurants. (See Note 8 &#150;
Notes Payable). Also included in current liabilities is a debenture for $125,000
which is in default, although the Company is endeavoring to reach a settlement
with the debenture holder. The Company had accounts payable of $479,727, accrued
taxes of $652,236 and accrued expenses and interest totaling $244,761. The
Company&#146;s current liabilities also include outstanding prepaid gift
certificates and other deferred revenue totaling $116,650. </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>With the acquisition of the specialty food business, the Company believes its cash flow will be sufficient to meet its fixed monthly expenses.  In addition, the Company intends to raise an additional $1,300,000 to reduce the sellers&#146; notes and for additional operating capital.   </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>  </font><b><font size=2>Inflation and Changing Prices </font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>The Company does not foresee any risks associated with inflation or substantial price increases in the near future.  In addition, the foodstuffs that are used by the Company in its affinage process are available through from many sources.  As such, while the Company has exposure to inflation, it does not believe that inflation will have any materially significant impact on its operations in the near future.   </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>2 </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>
<br>
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<pAGE>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><b><font size=2>Critical Accounting Policies </font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>The discussion and analysis of our financial condition and results of operations are based upon our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America.  The preparation of these financial statements requires us to make estimates and judgments that affect the reported amount of assets and liabilities, revenues and expenses, and related disclosure on contingent assets and liabilities at the date of our financial statements.  Actual results may differ from these estimates under different assumptions and conditions. </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>Critical accounting policies are defined as those that are reflective of significant judgments and uncertainties, and potentially result in materially different results under different assumptions and conditions.  We believe that our critical accounting policies are limited to those described below.  For a detailed discussion on the application of these and other accounting policies see our note 2 to our financial statements. </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><b><font size=2>Long-Lived Assets (including Tangible and Intangible Assets) </font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:0.5in;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>We acquired businesses in recent years, which resulted in tangible assets being recorded.  The determination of the value of such intangible assets requires management to make estimates and assumptions that affect our consolidated financial statements.  We assess potential impairment to the intangible and tangible assets on a quarterly basis or when evidence that events or changes in circumstances indicate that the carrying amount of an assets may not be recovered.  Our judgments regarding the existence of impairment indicators, if any, and future cash flows related to these assets are based on operational performance of our business, market conditions and other factors. </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><b><font size=2>Accounting for Income Taxes </font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>
As part of the process of preparing our financial statements we are required to
estimate our income taxes. Management judgment is required in determining our
provision of our deferred tax asset. We recorded a valuation for the full
deferred tax asset from our net operating losses carried forward due to the
Company not demonstrating any consistent profitable operations. In the event
that the actual results differ from these estimates or we adjust these estimates
in future periods we may need to adjust such valuation recorded. </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><b><font size=2>Stock-Based Compensation  </font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>The computation of the expense associated with stock-based compensation requires the use of a valuation model.  SFAS 123(R) is a new and very complex accounting standard, the application of which requires significant judgment and the use of estimates, particularly surrounding Black-Scholes assumptions such as stock price volatility, expected option lives, and expected option forfeiture rates, to value equity-based compensation.  The Company currently uses a Black-Scholes option pricing model to calculate the fair value of its stock options.  The Company primarily uses historical data to determine the assumptions to be used in the Black-Scholes model and has no reason to believe that future data is likely to differ materially from historical data. However, changes in the assumptions to reflect future stock price volatility and future stock award exercise  </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>3 </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>
<br>
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<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>experience could result in a change in the assumptions used to value awards in the future and may result in a material change to the fair value calculation of stock-based awards.  SFAS 123(R) requires the recognition of the fair value of stock compensation in net income.  Although every effort is made to ensure the accuracy of our estimates and assumptions, significant unanticipated changes in those estimates, interpretations and assumptions may result in recording stock option expense that may materially impact our financial statements for each respective reporting period.  The Company has issued options for compensation purposes in the recent quarter, although they do not get valued until a earnings provision contingency is resolved. </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<A NAME="A006"></A>
<table border="0" cellspacing=0 cellpadding=0 width="287" style='border-collapse:collapse'>
    <tr >
        <td width="96" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Item 3. </font></b></p> </td>
        <td width="191" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Controls and Procedures</font></b></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>Our
principal executive officer and principal financial officer, who is the sole
officer, evaluated the effectiveness of the Company&#146;s
disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)
under the Securities Exchange Act of 1934, as amended) as of the end of the
period covered by this report. Based on this evaluation, the principal executive
officer and principal financial officer have concluded that the disclosure
controls and procedures are effective to ensure that the information required to
be disclosed in this report under the Securities Exchange Act of 1934 (1) is
accumulated and communicated to its management, including its principal
executive and principal financial officers, or persons performing similar
functions, as appropriate to allow timely decisions regarding required
disclosure, and (2) has been recorded, processed, summarized and reported within
the time periods specified in the Securities and Exchange Commission rules and
forms. </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.75in;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>During the period covered by this report, there have not
been any significant changes in our internal controls or, to our knowledge, in other
factors that could significantly affect our internal controls. </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'>
</p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>4 </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>
<br>
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<pAGE>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


<table border="0" cellspacing=0 cellpadding=0 width="243" style='border-collapse:collapse'>
    <tr >
        <td width="96" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Part II </font></b></p> </td>
        <td width="147" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Other Information </font></b></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<A NAME="A007"></A>
<table border="0" cellspacing=0 cellpadding=0 width="240" style='border-collapse:collapse'>
    <tr >
        <td width="96" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Item 1. </font></b></p> </td>
        <td width="144" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Legal Proceedings </font></b></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:1in; text-indent:-1in;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>Upon the sale of the Company&#146;s intangibles relating to the building material business, the secured creditor, who otherwise would have been entitled to the proceeds of the sale, agreed to permit a portion of the proceeds to be used to pay judgment creditors a portion of their claims with the balance of their claims being paid in shares of common stock.  Collectively, these creditors received approximately $92,000 in cash for approximately one-third of their claims and 166,194 shares of common stock for the balance.   </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


<A NAME="A008"></A>
<table border="0" cellspacing=0 cellpadding=0 width="528" style='border-collapse:collapse'>
    <tr >
        <td width="96" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Item 2. </font></b></p> </td>
        <td width="432" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Unregistered Sales of Equity
Securities and Use of Proceeds. </font></b></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>In August 2007, several private investors made an equity investment of
$3,900,000 for which these investors received 3,900,000 shares of the Company&#146;s redeemable convertible preferred stock.
The proceeds were used to acquire the membership interests of a specialty food company.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>In August 2007, the Company issued 15,000 shares of redeemable convertible preferred stock in exchange for consulting services.  The company recorded an expense of $15,000 in connection with these shares. </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in; text-indent:-0.5in;text-align:justify;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>In January 2006, the Company and a judgment creditor reached an agreement whereby the creditor agreed to refrain from enforcing its judgment in exchange for a monthly payment of interest on the creditor&#146;s original loan to the Company and the Company&#146;s commitment to pay the judgment upon the earlier of the recapitalization of the Company or September 30, 2006.  Through subsequent amendments to the agreement, the date was extended to August 2007.  In August 2007, the creditor agreed to convert the outstanding judgment of $400,000 into 450,000 shares of the Company&#146;s common stock of which 400,000 shares would be held in escrow and liquidated for purposes of repaying the $400,000 judgment.  The Company recorded additional paid-in capital of $399,600 for the 400,000 shares and an interest expense of $15,000 in connection with the remaining 50,000 shares.   </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in; text-indent:-0.5in;text-align:justify;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>In August 2007, two secured creditors agreed to convert the outstanding principal and interest of their respective notes totaling approximately $2,000,684 into 1,675,000 shares of the Company&#146;s common stock   The Company recorded additional paid-in capital of $1,999,009 with respect to these shares.   </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>In August 2007, several of the Company&#146;s judgment creditors agreed to accept $91,903 in cash and a total of 166,194 shares of common stock in exchange for satisfactions of their respective claims totaling approximately $269,168.  As a result of these settlements, the Company reduced its accounts payable by $161,327.85, increased paid-in capital by approximately $130,000 and reduced the gain on sale by approximately $60,000.  </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>In August 2007, the Company issued 25,000 shares of common stock in exchange for consulting services.  The company recorded an expense of $7,500 in connection with these shares. </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in; text-indent:-0.5in;text-align:justify;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'>
</p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>5 </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>
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<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<A NAME="A009"></A>
<table border="0" cellspacing=0 cellpadding=0 width="395" style='border-collapse:collapse'>
  <tr >
    <td width="96" valign=top > <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Item 3. </font></b></p></td>
    <td width="197" valign=top > <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Defaults Upon Senior Securities. </font></b></p></td>
    <td width="102" valign=top > <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>None.</font></p></td>
  </tr>
</table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<A NAME="A010"></A>

<table border="0" cellspacing=0 cellpadding=0 width="521" style='border-collapse:collapse'>
    <tr >
        <td width="96" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Item 4. </font></b></p> </td>
        <td width="425" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Submission of Matters to a Vote of Security Holders. </font></b><font size=2>&nbsp;&nbsp;&nbsp;None. </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<A NAME="A011"></A>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Item 5. </font></b></p> </td>
        <td width="425" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Other Information.</font></b>&nbsp;<font>None.</font></p> </td> </tr></table>



<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:1in; text-indent:-1in;text-align:justify;'><font size=2>&nbsp; </font></p>

<A NAME="A012"></A>
<table border="0" cellspacing=0 cellpadding=0 width="356" style='border-collapse:collapse'>



    <tr >
        <td width="96" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Item 6. </font></b></p> </td>
        <td width="260" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Exhibits and Reports on Form 8-K.   </font></b></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>On August 15, 2007, the Company filed with the Securities and Exchange Commission a Form 8-K announcing that it had acquired Artisanal Cheese, LLC and had sold its building material assets. </font><u><b><font size=2>  </font></b></u><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font SIZE=2>SIGNATURES </font></b></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>Pursuant to the requirements of Section 13 or 15(d) of the Securities and Exchange Act of 1934, American Home Food Products, Inc. has duly caused this report to be signed on its behalf by the undersigned person who is duly authorized to sign on behalf of the Company as its principal executive officer and principal financial officer. </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=2>AMERICAN HOME FOOD PRODUCTS, INC. </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


<table border="0" cellspacing=0 cellpadding=0 width="380" style='border-collapse:collapse'>
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    <td  colspan="3" valign=top > <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>By:
        </font><u><font size=2> /ss/ Daniel W. Dowe </font></u></p></td>
    <td  width="201"> <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;
        </font></td>
  </tr>
  <tr >
    <td  width="23"> <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;
        </font></td>
    <td width="132" valign=top > <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Daniel
        W. Dowe </font></p></td>
    <td   colspan="2"> <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;
        </font></td>
  </tr>
  <tr >
    <td  width="23"> <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;
        </font></td>
    <td  colspan="3" valign=top > <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Chief
        Executive Officer and Chief Financial Officer </font></p></td>
  </tr>
  <tr>
    <td width="23" ></td>
    <td width="132" ></td>
    <td width="24" ></td>
    <td width="201" ></td>
  </tr>
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<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>Date:  October 19, 2007 </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>6 </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>
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<DOCUMENT>
<TYPE>EX-31
<SEQUENCE>2
<FILENAME>d72834_ex-31.htm
<DESCRIPTION>SECTION 302 CERTIFICATION OF CEO AND CFO
<TEXT>
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<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><b><font size=2>Exhibit 31 </font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><b><font SIZE=2>CERTIFICATION OF PRINCIPAL EXECUTIVE AND FINANCIAL OFFICER </font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><b><font size=2>Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002  </font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:0.5in;text-align:left;'><font size=2>I, Daniel W. Dowe, certify that: </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


<table  border="0" cellspacing=0 cellpadding=0 style='margin-left:.5in;border-collapse:collapse'>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>1. </font></p> </td>
        <td  valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>I have reviewed this quarterly report on Form 10-QSB for the three month period ending August 31, 2007, (the &#147;Report&#148;) of American Home Food Products, Inc. (the &#147;Company&#148;); </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>2. </font></p> </td>
        <td  valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Based on my knowledge, the Report does not contain any untrue statements of a material fact or omit to state a material fact necessary to make the statement made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by the Report;   </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


<table  border="0" cellspacing=0 cellpadding=0 style='margin-left:.5in;border-collapse:collapse'>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>3. </font></p> </td>
        <td  valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Based on my knowledge, the financial statements, and other financial information included in this Report, fairly presents in all materials respects the financial condition, results of operation and cash flows of the Company as of, and for, the periods presented in this Report; </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>4. </font></p> </td>
        <td  valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>I am responsible in my dual capacity as the Company&#146;s Chief Executive Officer and Chief Financial Officer (principal executive and principal financial officer) for establishing and maintaining  disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Company and have: </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


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        <td width="24" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>a) </font></p> </td>
        <td  valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Company, including its consolidated subsidiaries,  is made known to me by others within the Company and its subsidiaries, particularly during the period in which this Report is being prepared; </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:1in;text-align:left;'><font size=2>&nbsp; </font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>b) </font></p> </td>
        <td  valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>evaluated the effectiveness of the Company&#146;s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and  </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:1in;text-align:left;'><font size=2>&nbsp; </font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>c) </font></p> </td>
        <td  valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>disclosed in this report any change in the Company&#146;s internal control over financial reporting that occurred during the Company&#146;s most recent fiscal quarter (the Company&#146;s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Company&#146;s internal control over financial reporting; and </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>5. </font></p> </td>
        <td  valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>I have also disclosed as the Company&#146;s certifying officer that based on our most recent evaluation of internal control over financial reporting, to the Company&#146;s  </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:1in;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:1in;text-align:left;'><font size=2>&nbsp; </font></p>
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<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:1in;text-align:left;'><font size=2>auditors and the audit committee of the Company&#146;s board of directors (or persons performing the equivalent function): </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>a) </font></p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>all significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the Company&#146;s ability to record, process, summarize and report financial information; and  </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:1in;text-align:left;'><font size=2>&nbsp; </font></p>


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        <td width="24" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>b) </font></p> </td>
        <td  valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>any fraud, whether or not material, that involves management or other employees who have a significant role in the Company&#146;s internal controls over financial reporting. </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:3.5in;text-align:left;'><font size=2>By: </font><u><font size=2> /s/ Daniel W. Dowe                                    </font></u><font size=2>&nbsp; </font></p>


<table border="0" cellspacing=0 cellpadding=0 width="200" style='margin-left:273.0pt;border-collapse:collapse'>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Daniel W. Dowe </font></p> </td>
        <td   colspan="2">
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp; </font></td> </tr>
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        <td  colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Chief Executive Officer and </font></p> </td> </tr>
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        <td  colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Chief Financial Officer </font></p> </td>
        <td  width="32">
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp; </font></td> </tr>
    <tr>
        <td width="127" ></td>

        <td width="41" ></td>

        <td width="32" ></td> </tr> </table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:3.5in;text-align:left;'><font size=2>Date: October 19, 2007 </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:3.5in;text-align:left;'><font size=2>&nbsp; </font></p>


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<TYPE>EX-32
<SEQUENCE>3
<FILENAME>d72834_ex-32.htm
<DESCRIPTION>SECTION 906 CERTIFICATION OF CEO AND CFO
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<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><b><font size=2>Exhibit 32 </font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font SIZE=2>CERTIFICATION PURSUANT TO </font></b></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><b><font size=2>18 U.S.C. SECTION 1350 </font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><b><font SIZE=2>AS ADOPTED PURSUANT TO </font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><b><font SIZE=2>SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 </font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:0.5in;text-align:left;'><font size=2>I, Daniel W. Dowe, the Chief Executive Officer and Chief Financial Officer (principal executive and principal financial officer) of American Home Food Products, Inc. (the &#147;Company&#148;), pursuant to 18 U.S.C. ss.1350, as adopted pursuant to ss. 906 of the Sarbanes-Oxley Act of 2002, certify that: </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>(1)  </font></p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>In connection with the Quarterly Report of the Company on Form 10-QSB for the three month period ended August 31, 2007, as filed with the Securities and Exchange Commission on the date hereof (the &#147;Report&#148;), fully complies with the requirements of Section 13(a) and Section 15(d) of the Securities and Exchange Act of 1934; and </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>(2) </font></p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>The information contained in the Report fairly presents, in all material respects, the financial condition and results of operation of the Company for the periods presented therein. </font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:0.5in;text-align:left;'><font size=2>A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request. </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:0.5in;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:3.5in;text-align:left;'><font size=2>By: </font><u><font size=2> /s/ Daniel W. Dowe                                    </font></u><font size=2>&nbsp; </font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Daniel W. Dowe </font></p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp; </font></td> </tr>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Chief Executive Officer and </font></p> </td> </tr>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Chief Financial Officer </font></p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp; </font></td> </tr>
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        <td width="127" ></td>

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<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:3.5in;text-align:left;'><font size=2>Date: October 19, 2007 </font></p>

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<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp; </font></p>

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