Exhibit 10.37

                    WARRANT EXCHANGE and RELEASE AGREEMENT

      AGREEMENT  made as of the 9th day of December 2004 by and among the BAILEY
FAMILY TRUST,  having an address at [ ]  (hereinafter  referred to as "BAILEY"),
FORTUNA INVESTMENT  PARTNERS with an address at [ ] (hereinafter  referred to as
("FORTUNA"), FORTUNA UNPLUGGED with an address at [ ](hereinafter referred to as
"UNPLUGGED")  (collectively  referred to as the "WARRANT  HOLDERS") and CREATIVE
BAKERIES,  INC.  having its  principal  place of business at 20 Passaic  Avenue,
Fairfield New Jersey 07004 (hereinafter referred to as "CBAK").

                             W I T N E S S E T H:

      WHEREAS,   the   WARRANT   HOLDERS   hold  [  ]  warrants   collectively
that contain a put provision to CBAK;

      WHEREAS,  the  warrants  held  by  WARRANT  HOLDERS  are  due to  expire
December 31, 2004;

      WHEREAS,  the WARRANT HOLDERS are desirous of exchanging  their warrants
for shares of CBAK common stock;

      WHEREAS,  the WARRANT  HOLDERS  further wish to release CBAK, it officers,
directors  and all those  acting  on  behalf of CBAK from any and all  claims or
obligations associated with the warrants exchanged;

      WHEREAS,  CBAK is agreeable to exchanging  shares of CBAK common stock for
warrants owned by the WARRANT HOLDERS; and

      WHEREAS,   the  parties  are   desirous  of  defining   their  rights  and
responsibilities with respect to the transaction.


            NOW   THEREFORE,   IN   CONSIDERATION   OF  THE  MUTUAL
            REPRESENTATIONS,  COVENANTS AND  AGREEMENTS  HEREIN SET
            FORTH, THE PARTIES HERETO AGREE AS FOLLOWS:

            FIRST:  BAILEY owns [ ] warrants  of CBAK,  a copy of the warrant is
annexed  hereto as Exhibit A,  FORTUNA  owns [ ] warrants of CBAK, a copy of the
warrant is annexed hereto as Exhibit B, and UNPLUGGED owns [ ] warrants of CBAK,
a copy of the warrant is annexed hereto as Exhibit C which represents all of the
issued and  outstanding  warrants  subject to this Agreement  (collectively  the
"WARRANTS").


<PAGE>

            SECOND: Upon execution of the within Agreement, BAILEY will exchange
the [ ] warrants held by it for 640,041 shares of CBAK common stock.

            THIRD: Upon execution of the within Agreement, FORTUNA will exchange
the [ ] warrants held by it for 475,081 shares of CBAK common stock.

            FOURTH:  Upon  execution  of the within  Agreement,  UNPLUGGED  will
exchange the [ ] warrants held by it for 105,574 shares of CBAK common stock.

            FIFTH:  The WARRANT  HOLDERS  represent and warrant to CBAK that the
WARRANTS  are free and clear of any liens or  encumbrances  and that there is no
restriction on the WARRANT  HOLDERS with respect to the exchange of the WARRANTS
for shares of Common Stock in CBAK.

            SIXTH:  The parties  acknowledge  and  recognize  that the  business
operations and current  financial  statements of CBAK have been fully disclosed,
and all matters with  respect to the business of CBAK have been fully  disclosed
to all of the parties herein.

            SEVENTH:  As additional  consideration  for the exchange of WARRANTS
for shares of CBAK common  stock,  BAILEY hereby  releases  CBAK its  directors,
officers and all those acting on its behalf from and claims  associated with the
warrant  exchanged  and  hereby  relinquishes  any  and  all  rights  or  claims
associated with the warrants exchanged for common stock under this Agreement.

            EIGHTH: As additional consideration for the exchange of WARRANTS for
shares  of CBAK  common  stock,  FORTUNA  hereby  releases  CBAK its  directors,
officers and all those acting on its behalf from and claims  associated with the
warrant  exchanged  and  hereby  relinquishes  any  and  all  rights  or  claims
associated with the warrants exchanged for common stock under this Agreement.

            NINTH: As additional  consideration for the exchange of WARRANTS for
shares of CBAK common  stock,  UNPLUGGED  hereby  releases  CBAK its  directors,
officers and all those acting on its behalf from and claims  associated with the
warrant  exchanged  and  hereby  relinquishes  any  and  all  rights  or  claims
associated with the warrants exchanged for common stock under this Agreement.

            TENTH:  Each  party  further   acknowledges  that  it  has  had  the
opportunity to be represented by independent counsel concerning their respective
rights and obligations under the within Agreement and has specifically requested
Baratta & Goldstein  as counsel to CBAK to serve as escrow  agent in  connection
with the exchange of WARRANTS for common stock under the within Agreement.


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<PAGE>

            ELEVENTH:  The parties  further agree that the WARRANTS,  the common
stock of CBAK to be issued to the WARRANT  HOLDERS as set forth herein and fully
executed  Agreements are to be returned to the ESCROW AGENT in care of Baratta &
Goldstein,  Attn:  Joseph A.  Baratta,  597  Fifth  Avenue,  New York,  NY 10017
(telephone  212-750-9700  and  fax  212-750-8297]by  overnight  currier  or hand
delivery  and that the common  stock to be issued in exchange  for the  WARRANTS
will be forwarded to the WARRANT  HOLDERS at their  respective  addresses as set
forth in the  preamble of this  Agreement  unless the ESCROW  AGENT is otherwise
advised in writing by a party.

            TWELFTH:  The  parties  understand  and agree  that in the event any
additional or further documents are required with respect to the within exchange
of WARRANTS,  that each party agrees to provide same within a reasonable time of
a request of any such documents.

            THIRTEENTH:  It is further  understood  and agreed  that the parties
have  agreed  that the  exchange  of  WARRANTS  for stock  herein will be deemed
effective upon execution of the within Agreement by all parties.

            FOURTEENTH:  Except as set forth in paragraph ELEVENTH regarding the
procedure for exchange of WARRANTS and shares of common  stock,  all notices and
other  communications  hereunder shall be in writing and shall be deemed to have
been  validly  served,  given or  delivered  five (5) days after  deposit in the
United States mails, by certified mail,  return receipt  requested,  and postage
prepaid, when delivered personally,  one (1) day after delivery to any overnight
courier, or when transmitted by facsimile transmission facilities, and addressed
to the parties as set forth in the  preamble of this  agreement or to such other
address as each party may designate for itself by like notice.

            FIFTEENTH: The within Agreement is governed by the laws of the State
of New York and cannot be changed, altered or modified, except in writing signed
by the parties.  No delay or omission by any party in exercising  any right with
respect hereto shall operate as a waiver. A waiver on any one occasion shall not
be  construed  as a bar to, or  waiver  of,  any  right or remedy on any  future
occasion.


                         [The Remainder of this Page
                          Intentionally Left Blank]


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<PAGE>

      IN WITNESS  WHEREOF,  the parties  hereto have caused this Agreement to be
executed under seal as of the date first above written.

                                          CREATIVE BAKERIES, INC.


                                    By:
                                          --------------------------------------

                                          BAILEY FAMILY TRUST


                                    By:
                                          --------------------------------------

                                          FORTUNA INVESTMENT PARTNERS


                                    By:
                                          --------------------------------------

                                          FORTUNA UNPLUGGED


                                    By:
                                          --------------------------------------


Agreed to as to the Escrow Provisions Only:
-----------------------------
Baratta & Goldstein



[Signature Page to Warrant Exchange and Release Agreement]


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<PAGE>


STATE OF                , COUNTY OF                   SS.:

      I CERTIFY  that on January  ______ , 2005,  ______________  an  authorized
signatory on behalf of Bailey Family Trust, personally came before me and stated
to my satisfaction that this person (or if more than one, each person):

      (a)   was authorized to execute the within Exchange Agreement and Release;

      (b)   is the maker of the attached Exchange Agreement and Release;

      (c)   executed this Exchange  Agreement and Release as his or her own act;
            and

      (d)   entered into this  Exchange  Agreement  and Release for the full and
            actual consideration set forth herein


                                          Notary
My commission expires:


STATE OF                , COUNTY OF                   SS.:

      I CERTIFY  that on January  ______ , 2005,  ______________  an  authorized
signatory on behalf of Fortuna  Investment  Partners,  personally came before me
and  stated to my  satisfaction  that  this  person  (or if more than one,  each
person):

      (e)   was authorized to execute the within Exchange Agreement and Release;

      (f)   is the maker of the attached Exchange Agreement and Release;

      (g)   executed this Exchange  Agreement and Release as his or her own act;
            and

      (h)   entered into this  Exchange  Agreement  and Release for the full and
            actual consideration set forth herein


                                          Notary
My commission expires:


STATE OF                , COUNTY OF                   SS.:

      I CERTIFY  that on January  ______ , 2005,  ______________  an  authorized
signatory on behalf of Fortuna  Unplugged,  personally came before me and stated
to my satisfaction that this person (or if more than one, each person):

      (i)   was authorized to execute the within Exchange Agreement and Release;

      (j)   is the maker of the attached Exchange Agreement and Release;

      (k)   executed this Exchange  Agreement and Release as his or her own act;
            and

      (l)   entered into this  Exchange  Agreement  and Release for the full and
            actual consideration set forth herein



                                          Notary

My commission expires:


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                                                       "ANNEX EXHIBIT A WARRANT"


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<PAGE>

                                                       "ANNEX EXHIBIT B WARRANT"

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<PAGE>


                                                       "ANNEX EXHIBIT C WARRANT"


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