UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549



                                   FORM 10-QSB

(Mark One)
[x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
    ACT OF 1934
    For the quarterly period ended September 30, 2002

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
    ACT OF 1934

Commission File Number: 000-31317

                          RACHEL'S GOURMET SNACKS, INC.
                          -----------------------------
        (Exact name of small business issuer as specified in its charter)

               Minnesota                              41-1766701
               ---------                              ----------
   (State or other jurisdiction of        (I.R.S. Employer Identification No.)
    incorporation or organization)

            8120 Penn Avenue South, Suite 140, Bloomington, MN 55431
            --------------------------------------------------------
                    (Address of principal executive offices)

                                 (952) 884-2305
                                 --------------
                           (Issuer's telephone number)

The Registrant had 10,569,949 shares of Common Stock, $.01 par value outstanding
as of October 31, 2002.

Transitional Small Business Disclosure Format (Check one): Yes [ ] No [x]

<PAGE>


                          RACHEL'S GOURMET SNACKS, INC.

                                   FORM 10-QSB

                                Table of Contents

PART I. FINANCIAL INFORMATION                                                  3
        Item 1. Financial Statements                                           3
        Item 2. Management's Discussion and Analysis or Plan of Operation     12
        Item 3. Controls and Procedures                                       15

PART II. OTHER INFORMATION                                                    15
        Item 1. Legal Proceedings                                             15
        Item 2. Changes in Securities                                         15
        Item 3. Defaults Upon Senior Securities                               16
        Item 4. Submissions Of Matters To A Vote of Security Holders          16
        Item 5. Other Information                                             16
        Item 6. Exhibits and Reports on Form 8-K                              17
        SIGNATURE                                                             17

<PAGE>

PART I - FINANCIAL INFORMATION

Item 1. FINANCIAL STATEMENTS


                 RACHEL'S GOURMET SNACKS, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (unaudited)

<TABLE>
<CAPTION>
                                                            Three Months Ended                  Nine Months Ended
                                                               September 30,                      September 30,
                                                       -----------------------------     -----------------------------
                                                           2001             2002             2001             2002
                                                       ------------     ------------     ------------     ------------
                                                        (Restated)                        (Restated)
<S>                                                    <C>              <C>              <C>              <C>
SALES                                                  $    467,592     $    502,745     $  1,146,320     $  1,389,352

COST OF GOODS SOLD                                          363,948          406,911          967,834        1,137,433
                                                       ------------     ------------     ------------     ------------

GROSS MARGIN                                                103,644           95,834          178,486          251,919

OPERATING EXPENSES                                          285,510          318,570          915,113          802,551
                                                       ------------     ------------     ------------     ------------

OPERATING LOSS                                             (181,866)        (222,736)        (736,627)        (550,632)
                                                       ------------     ------------     ------------     ------------

NONOPERATING INCOME (EXPENSES)
  Interest                                                 (127,746)        (125,339)        (392,212)        (410,788)
  Gain (loss) on foreign exchange                               -                -              1,247          (44,413)
  Gain on sales of marketable securities                     51,182              -            110,917              -
                                                       ------------     ------------     ------------     ------------
                                                            (76,564)        (125,339)        (280,048)        (455,201)
                                                       ------------     ------------     ------------     ------------

LOSS FROM CONTINUING OPERATIONS                            (258,430)        (348,075)      (1,016,675)      (1,005,833)
                                                       ------------     ------------     ------------     ------------

DISCONTINUED OPERATIONS
  Loss from discontinued operations                        (162,081)             -           (372,965)        (862,372)
  Loss on liquidation of discontinued operations                -                -                -           (231,158)
                                                       ------------     ------------     ------------     ------------
                                                           (162,081)             -           (372,965)      (1,093,530)
                                                       ------------     ------------     ------------     ------------

NET LOSS                                               $   (420,511)    $   (348,075)    $ (1,389,640)    $ (2,099,363)
                                                       ============     ============     ============     ============

NET LOSS PER SHARE -
  BASIC AND DILUTED:
    Continuing Operations                              $      (0.02)    $      (0.03)    $      (0.10)    $      (0.09)
    Discontinued Operations                                   (0.02)             -              (0.04)           (0.11)
                                                       ------------     ------------     ------------     ------------
    Net Loss                                           $      (0.04)    $      (0.03)    $      (0.14)    $      (0.20)
                                                       ============     ============     ============     ============

WEIGHTED AVERAGE SHARES
  OUTSTANDING - BASIC AND DILUTED                         9,833,585       10,459,949        9,585,759       10,355,350


</TABLE>



See notes to condensed consolidated financial statements.



                                        3


<PAGE>


                 RACHEL'S GOURMET SNACKS, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                    December 31,     September 30,
                                                                       2001              2002
                                                                    ------------     ------------
                                                                      (audited)       (unaudited)
                                                                     (Restated)
<S>                                                                 <C>             <C>
              ASSETS
CURRENT ASSETS
  Cash                                                              $     32,668    $         -
  Accounts receivable, less allowance of $15,000 and $22,000              90,395          137,266
  Inventories                                                            106,265          188,364
  Prepaid expenses and other                                             116,554           85,114
                                                                    ------------     ------------
      TOTAL CURRENT ASSETS                                               345,882          410,744

PROPERTY AND EQUIPMENT                                                   285,848          295,141

CARRYING VALUE OF DISCONTINUED SUBSIDIARY                              1,902,039              -

GOODWILL                                                                 626,397          626,397

OTHER ASSETS                                                              18,000           24,215
                                                                    ------------     ------------

                                                                    $  3,178,166     $  1,356,497
                                                                    ============     ============

              LIABILITIES AND STOCKHOLDERS' DEFICIENCY
CURRENT LIABILITIES
  Convertible subordinated debt                                     $  2,856,167     $  2,431,341
  Notes payable                                                          287,050          385,970
  Current maturities of long-term debt                                    26,493          652,723
  Accounts payable                                                       448,652          657,470
  Accrued expenses                                                       940,668          531,332
                                                                    ------------     ------------
      TOTAL CURRENT LIABILITIES                                        4,559,030        4,658,836
                                                                    ------------     ------------

LONG-TERM DEBT, less current maturities                                   91,996          114,815
                                                                    ------------     ------------

COMMITMENTS AND CONTINGENCIES                                                -                -
                                                                    ------------     ------------

STOCKHOLDERS' DEFICIENCY
  Preferred stock, $.01 par value; 20,000,000 shares authorized;
    no shares issued and outstanding                                         -                -
  Common stock, $.01 par value; 50,000,000 shares authorized;
   10,172,959 and 10,569,949 shares issued and outstanding               101,730          105,699
  Additional paid-in capital                                          13,443,370       13,530,657
  Accumulated other comprehensive loss                                   (63,813)             -
  Accumulated deficit                                                (14,954,147)     (17,053,510)
                                                                    ------------     ------------
                                                                      (1,472,860)      (3,417,154)
                                                                    ------------     ------------

                                                                    $  3,178,166     $  1,356,497
                                                                    ============     ============
</TABLE>

See notes to condensed consolidated financial statements.



                                        4
<PAGE>




                 RACHEL'S GOURMET SNACKS, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (unaudited)
<TABLE>
<CAPTION>
                                                                                       Nine Months Ended
                                                                                         September 30,
                                                                                  ---------------------------
                                                                                     2001            2002
                                                                                  -----------     -----------
                                                                                   (Restated)
<S>                                                                               <C>             <C>
OPERATING ACTIVITIES
  Net loss                                                                        $(1,389,640)    $(2,099,363)
  Adjustments to reconcile net loss to net cash used by operating activities:
    Discontinued operations, including loss on liquidation                            372,965       1,093,530
    Depreciation                                                                       73,972          62,394
    Amortization                                                                       36,139             -
    Interest expense added to debt principal                                          115,464         133,887
    Gain on sales of marketable securities                                           (110,917)            -
    Common stock issued for services                                                   60,000          17,000
    Convertible subordinated debt issued for services                                     -            45,000
    Intracompany liability to discontinued subsidiary discharged by bankruptcy            -           872,322
    Changes in operating assets and liabilities:
      Accounts receivable                                                             (15,137)        (46,871)
      Inventories                                                                     (52,436)        (82,099)
      Prepaid expenses and other                                                       56,892          87,831
      Accounts payable                                                                 26,151         208,818
      Accrued expenses                                                                183,141        (323,766)
                                                                                  -----------     -----------
        Net cash used by operating activities                                        (643,406)        (31,317)
                                                                                  -----------     -----------

INVESTING ACTIVITIES
  Proceeds from sales of marketable securities                                        137,710             -
  Purchases of property and equipment                                                 (30,572)         (9,532)
                                                                                  -----------     -----------
        Net cash provided (used) by investing activities                              107,138          (9,532)
                                                                                  -----------     -----------

FINANCING ACTIVITIES
 Decrease in checks issued in excess of deposits                                     (135,240)            -
  Proceeds from debt                                                                1,022,300          30,000
  Payments on debt                                                                   (361,394)        (26,819)
  Proceeds from sale of common stock                                                   22,500           5,000
                                                                                  -----------     -----------
        Net cash provided by financing activities                                     548,166           8,181
                                                                                  -----------     -----------

NET INCREASE (DECREASE) IN CASH                                                        11,898         (32,668)

CASH
  Beginning of period                                                                     -            32,668
                                                                                  -----------     -----------

  End of period                                                                   $    11,898    $        -
                                                                                  ===========     ===========

Cash paid for interest                                                            $   110,865     $    55,727

Noncash operating, financing and investing activities:
  Convertible subordinated debt refinanced                                        $ 1,541,770     $ 2,243,790
  Notes payable issued for accrued expenses                                               -            83,920
  Retirement of obligation payable with restricted securities                         515,700             -
  Receipt of restricted securities for obligation payable                             332,000             -
  Common stock issued for financing costs                                             145,709          62,606
  Common stock issued for notes payable and accrued expenses                              -             6,650
  Unrealized losses on securities                                                    (107,157)            -
  Equipment acquired under capital leases                                              88,025          62,155
  Foreign currency translation gain                                                    14,728          63,813

</TABLE>

See notes to condensed consolidated financial statements.



                                        5

<PAGE>


                                       6
                 RACHEL'S GOURMET SNACKS, INC. AND SUBSIDIARIES
              Notes to Condensed Consolidated Financial Statements
                        Quarter Ended September 30, 2002
                                   (unaudited)

1.  Basis of Presentation and Significant Accounting Policies -

       The accompanying unaudited condensed consolidated financial statements
       have been prepared in accordance with accounting principles generally
       accepted in the United States of America for interim financial
       information. They do not include all of the information and footnotes
       required by accounting principles generally accepted in the United States
       of America for complete financial statements. In the opinion of
       management, all adjustments, consisting of normal recurring accruals,
       considered necessary for a fair presentation have been included.
       Operating results for the three month and nine month periods ended
       September 30, 2002, are not necessarily indicative of the results that
       may be expected for the year ending December 31, 2002. For further
       information, refer to the financial statements and footnotes included in
       our Annual Report on Form 10-KSB for the year ended December 31, 2001.

       Nature of Business

       The Company manufactures, markets and distributes "Rachel's Made From the
       Heart" gourmet potato chips (snack foods). The potato chips are sold by
       independent distributors and Company sales personnel to grocery and
       convenience stores, restaurants, and other retail and institutional
       accounts. The Company also manufactures potato chips for others under
       private labels.

       Principles of Consolidation

       The condensed consolidated financial statements include the accounts of
       Rachel's Gourmet Snacks, Inc., its U.S. subsidiary, Rachel's
       Manufacturing, Inc., and its Canadian subsidiary, Triple-C-Inc.
       (collectively "the Company"). The assets of Triple-C-Inc. were liquidated
       and Triple-C-Inc.'s operations were discontinued in August, 2002 (See
       Note 3). The net assets of Triple-C-Inc. are included in the carrying
       value of discontinued subsidiary in the condensed consolidated balance
       sheets and in discontinued operations in the condensed consolidated
       statements of operations (Note 3). All significant intercompany balances
       and transactions have been eliminated.

       Management Estimates

       The preparation of these condensed consolidated financial statements in
       conformity with accounting principles generally accepted in the United
       States of America requires management to make estimates and assumptions
       that may affect the reported amounts and disclosures in the condensed
       consolidated financial statements and accompanying notes. Actual results
       could differ from these estimates. Significant management estimates
       relate to the valuation of goodwill and the valuation allowance on
       deferred tax assets.

       Revenue Recognition

       The Company recognizes revenue at the time product is shipped to a
       customer. Estimated allowances for bad debts, discounts and returns are
       recorded at the time of sale as a reduction against accounts receivable
       with a charge to operations.


<PAGE>

                                        7
                 RACHEL'S GOURMET SNACKS, INC. AND SUBSIDIARIES
              Notes to Condensed Consolidated Financial Statements
                        Quarter Ended September 30, 2002
                                   (unaudited)


       Foreign Currency Translation and Transactions

       Assets and liabilities of Triple-C-Inc. are translated at the exchange
       rate in effect at the balance sheet date. Revenues and expenses are
       translated at the average period exchange rate. Translation adjustments
       arising from the use of differing exchange rates are reported as
       accumulated other comprehensive loss in stockholders' deficiency.

       Fair Value of Financial Instruments

       The carrying amounts of financial instruments consisting of cash,
       receivables, convertible subordinated debt, notes payable, long-term
       debt, accounts payable and accrued expenses approximate their fair
       values.

       Inventories

       Inventories are valued at the lower of cost or market, with cost
       determined on a moving average basis and market determined at net
       realizable value.

       Property and Equipment

       Property and equipment are stated at cost less accumulated depreciation.
       Depreciation is provided using both the straight-line and declining
       balance methods over the estimated useful lives of the assets. Leasehold
       improvements are amortized over the lease term.

       Goodwill

       Goodwill represents the excess of the purchase price and related costs
       over the fair value of the identifiable net assets of businesses acquired
       less amortization through December 31, 2001. Effective January 1, 2002,
       the Company adopted Statement of Financial Standards (SFAS) No. 142,
       "Goodwill and Other Intangible Assets," which addresses accounting for
       acquired goodwill and other intangible assets, discontinues the
       amortization of acquired goodwill, and makes goodwill subject to periodic
       impairment testing. The initial impairment testing of the unamortized
       goodwill relating to Rachel's Manufacturing, Inc. in the amount of
       $626,397 has not been completed. SFAS No. 142 required this testing to be
       completed by June 30, 2002. The Company does not believe that the
       completion of the process will result in the impairment of this goodwill
       or materially impact its consolidated financial statements.

       Assuming that SFAS No. 142 was in effect as of January 1, 2001 the
       adjusted net loss would be $375,652, $348,075, $1,255,063, and $2,099,363
       for the three months ended September 30, 2001 and 2002 and the nine
       months ended September 30, 2001 and 2002, respectively. The net loss per
       share is the same as previously reported in all periods except for the
       nine month period ended September 30, 2001, where the loss would be $.13
       rather than the $.14 previously reported. The adjusted losses and per
       share amounts are as follows:

<PAGE>


                                       8
                 RACHEL'S GOURMET SNACKS, INC. AND SUBSIDIARIES
              Notes to Condensed Consolidated Financial Statements
                        Quarter Ended September 30, 2002
                                   (unaudited)

<TABLE>
<CAPTION>
                                                          Three Months Ended September 30,
                                                          --------------------------------
                                                                2001            2002
                                                                ----            ----
<S>                                                         <C>             <C>
       Continuing Operations
       ---------------------
         Reported net loss                                  $  (258,430)    $  (348,075)
         Goodwill amortization                                   12,046              --
                                                            -----------     -----------
         Adjusted net loss                                  $  (246,384)    $  (348,075)
                                                            -----------     -----------

         Reported net loss per share - basic and diluted    $      (.02)    $      (.03)
         Goodwill amortization                                       --              --
                                                            -----------     -----------
         Adjusted net loss                                  $      (.02)    $      (.03)
                                                            ===========     ===========

<CAPTION>
                                                          Three Months Ended September 30,
                                                          --------------------------------
                                                                2001            2002
                                                                ----            ----
<S>                                                         <C>             <C>
       Discontinued Operations
       -----------------------
         Reported net loss                                  $  (162,081)    $        --
         Goodwill amortization                                   32,813              --
                                                            -----------     -----------
         Adjusted net loss                                  $  (129,268)    $        --
                                                            ===========     ===========

         Reported net loss per share - basic and diluted    $      (.02)    $        --
         Goodwill amortization                                       --              --
                                                            -----------     -----------
         Adjusted net loss                                  $      (.02)    $        --
                                                            ===========     ===========

<CAPTION>
                                                          Nine Months Ended September 30,
                                                          --------------------------------
                                                                2001            2002
                                                                ----            ----
<S>                                                         <C>             <C>
       Continuing Operations
       ---------------------
         Reported net loss                                  $(1,016,675)    $(1,005,833)
         Goodwill amortization                                   36,138              --
                                                            -----------     -----------
         Adjusted net loss                                  $  (980,537)    $(1,005,833)
                                                            -----------     -----------

         Reported net loss per share - basic and diluted    $      (.10)    $      (.09)
         Goodwill amortization                                       --              --
                                                            -----------     -----------
         Adjusted net loss                                  $      (.10)    $      (.09)
                                                            ===========     ===========

       Discontinued Operations
       -----------------------
         Reported net loss                                  $  (372,965)    $(1,093,530)
         Goodwill amortization                                   98,439              --
                                                            -----------     -----------
         Adjusted net loss                                  $  (274,526)    $(1,093,530)
                                                            -----------     -----------

         Reported net loss per share - basic and diluted    $      (.04)    $      (.11)
         Goodwill amortization                                      .01              --
                                                            -----------     -----------
         Adjusted net loss                                  $      (.03)    $      (.11)
                                                            ===========     ===========
       Common Stock Issued
</TABLE>

<PAGE>


                                       9
                 RACHEL'S GOURMET SNACKS, INC. AND SUBSIDIARIES
              Notes to Condensed Consolidated Financial Statements
                        Quarter Ended September 30, 2002
                                   (unaudited)


       The Company issued common stock for certain services and financing. The
       value of these services and financing was based on the fair value of the
       common stock as determined by public trades of the Company's common stock
       during the same time periods. The costs of the services were charged to
       operations and stockholders' deficiency was decreased. Stock issued for
       financing was to settle liabilities and to obtain additional debt
       financing.

       Stock-Based Compensation

       The Company accounts for employee stock options under Accounting
       Principles Board No. 25, "Accounting for Stock Issued to Employees," and
       provides the disclosures required by SFAS No. 123, "Accounting for
       Stock-Based Compensation." Options and warrants to nonemployees are
       accounted as required by SFAS No. 123.

       Credit Risk

       Significant concentrations of credit risk exist in accounts receivable,
       which are due from customers dispersed across different geographic and
       economic regions in the Upper Midwest.

       Net Loss Per Share

       Net loss per share - basic is determined by dividing the net loss by the
       weighted-average common shares outstanding. Net loss per share - diluted
       normally includes common stock equivalents (options, warrants and
       convertible debentures), but were excluded since their effect was
       antidulitive.

       Restatement

       Due to the cessation of operating activities of Triple-C-Inc. and the
       sale of the assets of Triple-C-Inc. (See Note 3), the 2001 financial
       statements were restated to make them comparable with 2002. The assets,
       liabilities, operations, and cash flows of Triple-C-Inc. were previously
       included in the consolidated amounts in the condensed consolidated
       financial statements. The Triple-C-Inc. net assets have been reclassified
       to the carrying value of discontinued subsidiary at December 31, 2001,
       and the operations of Triple-C-Inc. are included in discontinued
       operations. These reclassifications did not affect previously reported
       stockholders' deficiency or net loss, but did affect the net cash flows.

2.  Going Concern

       The condensed consolidated financial statements were prepared in
       contemplation of the Company as a going concern. The Company has incurred
       net losses of $1,939,225, $1,732,884 and $2,099,363 for calendar years
       2000 and 2001 and the nine months ended September 30, 2002, respectively,
       and as of September 30, 2002, has a working capital deficiency of
       $4,248,092, an accumulated deficit of $17,053,510 and a stockholders'
       deficiency of $3,417,154. The Company also has a material uncertainty
       regarding a shareholder dispute (See Note 4). These conditions, among
       others, raise substantial doubt about the Company's ability to continue
       as a going concern.

       The Company's continuation as a going concern is dependent upon its
       ability to generate sufficient operating cash flows and obtain additional
       financing or refinancing to meet its obligations. The Company is pursuing

<PAGE>


                                       10
                 RACHEL'S GOURMET SNACKS, INC. AND SUBSIDIARIES
              Notes to Condensed Consolidated Financial Statements
                        Quarter Ended September 30, 2002
                                   (unaudited)


       plans to increase sales and profits and decrease operating expenses. In
       addition, the Company is attempting to raise additional debt and equity
       financing. The condensed consolidated financial statements do not include
       any adjustments relating to the recoverability and classification of
       recorded assets and liabilities should the Company be unable to continue
       as a going concern.

3.  Discontinued Operations

       Triple-C-Inc., a subsidiary of the Company, had a revolving line of
       credit facility with Congress Financial Corporation (Congress). Under the
       terms of the agreement, borrowings were due on demand and were
       collateralized by substantially all Triple-C-Inc.'s assets. The line of
       credit had requirements relating to tangible net worth, additional debt,
       and dividends, among other requirements. Over the seven months ended July
       31, 2002, Congress reduced availability under the line of credit severely
       limiting Triple-C-Inc.'s access to vital working capital. On August 1,
       2002, the Company sought an order appointing Mintz & Partners Limited
       (Mintz) as interim receiver of Triple-C-Inc. On the same day,
       Triple-C-Inc. made an assignment pursuant to the provisions of the
       Bankruptcy and Insolvency Act (Canada), naming Mintz as trustee. Also on
       August 1, 2002, subject to the making of the Approval and Vesting Order,
       Mintz agreed to sell to Johnvince Foods, Ltd. (Johnvince), and Johnvince
       agreed to buy from Mintz, all of Mintz's and Triple-C-Inc.'s right,
       title, and interest in substantially all Triple-C-Inc.'s assets. On
       August 8, 2002, the Supreme Court of Ontario appointed Mintz as the
       interim receiver and approved the sale of the assets by issuance of an
       Approval and Vesting Order. The purchase price for the assets was not
       sufficient to satisfy the unsecured debts of Triple-C-Inc. The assets,
       liabilities, operations, and cash flows of Triple-C-Inc. were previously
       included in the consolidated amounts in the condensed consolidated
       financial statements. The Triple-C-Inc. net assets have been reclassified
       to the carrying value of discontinued subsidiary at December 31, 2001,
       and the operations of Triple-C-Inc. are included in discontinued
       operations.

4.  Contingencies and Uncertainties

       The Company has a dispute relating to options held by certain
       stockholders. The stockholders believe the Company is required to
       repurchase their 608,000 shares for $3.221 per share ($1,958,368) with
       five year 6% promissory notes. The Company believes the stockholders did
       not exercise their options by the October 1, 1999, specified date in the
       manner required. The stockholders assert that they did properly exercise
       their options and the Company's dispute is without merit. It is possible
       that either party may resort to judicial resolution of this matter. While
       the Company is confident that it did not receive actual or constructive
       notice of exercise of the stockholders' right to require the Company to
       purchase all or part of its shares, it is a possibility that litigation
       with the stockholders will result in an adverse judgment against the
       Company, which may have a material adverse effect on the Company and its
       operations, and may jeopardize the Company's ability to continue as a
       going concern. The terms of the notes require the principal to be paid in
       full five years after the exercise of the options with semi-annual
       interest payments. The outcome at this time cannot be determined.

<PAGE>


                                       11
                 RACHEL'S GOURMET SNACKS, INC. AND SUBSIDIARIES
              Notes to Condensed Consolidated Financial Statements
                        Quarter Ended September 30, 2002
                                   (unaudited)


5.  Changes in Securities

       Issuance of Common Stock

       On August 7, 2002, the Company issued common stock to certain parties
       known to the Company as follows: (i) 170,000 shares to three individuals,
       including 70,000 shares to two Directors of the Company, in exchange for
       services provided to the Company and (ii) 50,000 shares to a Director of
       the Company in exchange for cash.

       Providers of services to the Company agreed to accept common stock of the
       Company in lieu of cash compensation. All issuances of common stock were
       unregistered in reliance upon Section 4(2) of the Securities Act of 1933.
       There were no offering expenses incurred by the Company in conjunction
       with these issuances.

       Convertible Debenture Offerings

       On August 31, 2002, the Company issued or reissued convertible debentures
       to two individual purchasers in the amount of $907,725. Included in this
       amount was a debenture for $45,000 which was issued in exchange for
       services. The debentures vary in term from one to twelve months, are
       convertible into common stock of the Company at a conversion rate of $.50
       per share, and were issued to certain parties known to the Company.

       The issuances of the convertible debentures were exempt from registration
       in the United States under Section 4(2) of the Securities Act of 1933. As
       of the date of this report none of the convertible debentures issued in
       2002 have been converted into common stock of the Company. No offering
       expenses were incurred in conjunction with these issuances.

<PAGE>


                                       12


Item 2. Management's Discussion and Analysis or Plan of Operation

       INTRODUCTION
       This quarterly report on Form 10-QSB contains certain forward-looking
       statements that involve risks and uncertainties. These statements refer
       to objectives, expectations, intentions, future events, or our future
       financial performance, and involve known and unknown risks,
       uncertainties, and other factors that may cause our actual results, level
       of activity, performance, or achievements to be materially different from
       any results expressed or implied by these forward-looking statements. In
       some cases, you can identify forward-looking statements by words such as
       "may," "will," "should," "could," "expects," "anticipates," "intends,"
       "plans," "believe," "estimates," "predicts," "potential," and similar
       expressions. Our actual results could differ materially from those
       included in forward-looking statements.

       RESULTS OF OPERATIONS

       THREE MONTHS ENDED SEPTEMBER 30, 2002, COMPARED TO THREE MONTHS ENDED
       SEPTEMBER 30, 2001

       Snack food sales from continuing operations for the three months ended
       September 30, 2002, were $502,745 compared to $467,592 for the three
       months ended September 30, 2001. The increase was primarily due to
       increased sales of "private label" products to Target Corporation. The
       net loss for the three months ended September 30, 2002 was $348,075, or
       $.03 per share, compared to a net loss of $420,511, or $.04 per share, in
       the comparable period of 2001. The loss from continuing operations for
       the three months ended September 30, 2002 was $348,075, or $.03 per
       share, compared to a loss from continuing operations of $258,430, or $.02
       per share, in the comparable three months of 2001. The was no loss from
       discontinued operations for the three months ended September 30, 2002,
       compared to loss from discontinued operations of $162,081, or $.02 per
       share, in the comparable period of 2001. The increase in loss from
       continuing operations was the result of a decrease in gross margin of
       $7,810, increased operating expenses of $33,060, and increased net
       nonoperating expenses of $48,775.

       Cost of goods sold increased by $42,963 to $406,911 in the three months
       ended September 30, 2002, from $363,948 in the comparable period of 2001.
       Cost of goods sold as a percentage of sales increased by 3.1% to 80.9% in
       2002 compared to 77.8% in 2001. The increase was the result of higher
       costs on certain materials used in production.

       Operating expenses for the three months ended September 30, 2002, were
       $318,570, compared to $285,510 in the same period the prior year.
       Operating expenses decreased by $21,491, a decrease of 17%, in the snack
       foods operations in the three months ended September 30, 2002 compared to
       2001. In the quarter ended in 2001, the Company expensed $30,000 related
       to the writeoff of receivables from a customer who declared bankruptcy.
       Corporate expenses increased by $54,551 in 2002 compared to 2001 because
       of increased consulting fees primarily related to efforts to obtain
       additional financing. This increase was partially offset by the effect of
       the change in accounting for goodwill. Goodwill amortization was $12,046
       in the three months ended September 30, 2001. Goodwill was not amortized
       in 2002.

       Net nonoperating expenses for the three months ended September 30, 2002,
       were $125,339, compared to $76,564 for the three months ended September
       30, 2001. Interest expense decreased by $2,407 to $125,339 in 2002,
       compared to $127,746 in 2001. The increase in the amount of debt
       outstanding was more than offset by a decrease in the effective interest
       rate. The Company realized a gain of $51,182 in the three months ended
       September 30, 2001 from the sale of marketable securities it held for

<PAGE>

                                       13


       investment, which gain was included in nonoperating income (expense). The
       Company did not sell any marketable securities in the three months ended
       September 30, 2002.

       NINE MONTHS ENDED SEPTEMBER 30, 2002, COMPARED TO NINE MONTHS ENDED
       SEPTEMBER 30, 2001

       Snack food sales from continuing operations for the nine months ended
       September 30, 2002, were $1,389,352 compared to $1,146,320 for the nine
       months ended September 30, 2001. The increase was primarily due to
       increased sales of "private label" products to Target Corporation. The
       net loss for the nine months ended September 30, 2002 was $2,099,363, or
       $.20 per share, compared to a net loss of $1,389,640, or $.14 per share,
       in the comparable period of 2001. The loss from continuing operations for
       the nine months ended September 30, 2002 was $1,005,833, or $.09 per
       share, compared to a loss from continuing operations of $1,016,675, or
       $.10 per share, in the comparable nine months of 2001. The loss from
       discontinued operations for the nine months ended September 30, 2002 was
       $1,093,530, or $.11 per share, compared to loss from discontinued
       operations of $372,965, or $.04 per share, in the comparable period of
       2001. The decrease in loss from continuing operations was the result of
       an increase in the gross margin of $73,433, a decrease in operating
       expenses of $112,562, offset by increased net nonoperating expenses of
       $175,153.

       Cost of goods sold increased by $169,599 to $1,137,433 in the nine months
       ended September 30, 2002, from $967,834 in the comparable period of 2001.
       Cost of goods sold as a percentage of sales decreased by 2.5% to 81.9% in
       2002, as compared to 84.4% in 2001. The decrease was the primarily a
       result of efficiencies realized from the purchase of new equipment.

       Operating expenses for the nine months ended September 30, 2002, were
       $802,551, compared to $915,113 in the same period the prior year.
       Operating expenses increased by $7,878, an increase of 2.4%, in the snack
       foods operations in the nine months ended September 30, 2002 compared to
       2001. Operating expenses increased due to the sales increase. In the nine
       months ended September 30, 2001, snack food expenses included $30,000
       related to the writeoff of receivables from a customer who declared
       bankruptcy. Corporate expenses decreased by $120,440 in 2002 compared to
       2001 because of cost cutting efforts and the effect of the change in
       accounting for goodwill. These decreases were partially offset by
       increased consulting fees related to efforts to obtain additional
       financing. Goodwill amortization was $36,138 in the nine months ended
       September 30, 2001. Goodwill was not amortized in 2002.

       Net nonoperating expenses for the nine months ended September 30, 2002,
       were $455,201, compared to $280,048 for the nine months ended September
       30, 2001. Interest expense increased by $18,576 to $410,788 in 2002,
       compared to $392,212 in 2001. The increase in the amount of debt
       outstanding was partially offset by a decrease in the effective interest
       rate. Foreign currency exchange losses were $44,413 in 2002 compared to a
       gain of $1,247 in 2001. The fluctuations in foreign exchange were related
       to the liability to Triple-C-Inc. and were caused by fluctuations of the
       Canadian dollar in relation to the U. S. dollar. The Company realized a
       gain of $110,917 in the nine months ended September 30, 2001 from the
       sale of marketable securities it held for investment, which gain was
       included in nonoperating income (expense). The Company did not sell any
       marketable securities in the nine months ended September 30, 2002.

<PAGE>


                                       14


       LIQUIDITY AND CAPITAL RESOURCES (FOR THE NINE MONTHS ENDED SEPTEMBER 30,
       2002)

       The Company is currently in dispute with former stockholders of
       Triple-C-Inc. stock. The dispute relates to the obligation of the Company
       to repurchase shares of common stock issued to the former stockholders of
       Triple-C-Inc. for a total of $1,958,368 by delivery of a five-year 6%
       promissory note. Although neither party has resorted to litigation at
       this point, it is a possibility that either party may resort to judicial
       resolution of this matter, and it is a possibility that any litigation
       with former Triple-C-Inc. stockholders will result in an adverse judgment
       against the Company, which adverse judgment may have a material adverse
       effect on the Company and its operations, its future liquidity, and any
       adverse judgment may jeopardize the Company's ability as a going concern.

       The Company does not currently have any material credit facilities in
       place to finance its operations, and is financing its operations out of
       current cashflow. The Company is actively exploring alternatives to
       provide capital for its operations. The Company estimates that it will
       need at least $500,000 in operating capital over the next six months, of
       which there can be no assurance of availability. The Company was unable
       to meet its goal of obtaining capital investments of $400,000 in 2001
       and, in fact, obtained no material capital financing in 2002 to date or
       in all of 2001.

       At September 30, 2002, the Company's obligations and commitments to make
       future payments under debt and lease agreements is as follows:

<TABLE>
<CAPTION>
                                                                 Payments Due by Year
                           ----------------------------------------------------------------------------------------------
                               2002          2003          2004          2005          2006      Thereafter      Total
                               ----          ----          ----          ----          ----      ----------      -----
<S>                        <C>           <C>           <C>           <C>           <C>           <C>           <C>
       Convertible debt    $2,356,572    $   74,769    $       --    $       --    $       --    $       --    $2,431,341
       Notes Payable          385,970            --                          --            --            --       385,970
       Long-term debt           7,880       653,484        28,206        33,196        24,181        20,591       767,538
       Operating leases        13,200        57,100        57,600        57,600        57,600       179,200       422,300
                           ----------    ----------    ----------    ----------    ----------    ----------    ----------
       Total               $2,763,622    $  785,353    $   85,806    $   90,796    $   81,781    $  199,791    $4,007,149
                           ==========    ==========    ==========    ==========    ==========    ==========    ==========
</TABLE>

       The inability of the Company to obtain additional capital financing will
       have a material adverse effect on the Company's ability to continue
       operations. In the event that the Company has insufficient cashflow to
       provide operating capital to the Company over the next 12 months, and is
       unable to obtain additional capital financing, the Company may consider
       pursuing additional debt or equity financing, and may be forced to
       explore alternatives, including reorganization under the U.S. Bankruptcy
       Code, although no such reorganization is currently under consideration.

       Net cash used by operating activities for the nine months ended September
       30, 2002, was $31,317. Negative operating cashflow resulted primarily
       from the loss from continuing operations which was partially offset by
       the intercompany liability to discontinued subsidiary discharged by
       bankruptcy.

       Net cash used by investing activities for the nine months ended September
       30, 2002, was $9,532. The funds were used to purchase required property
       and equipment.

       Net cash provided by financing activities for the nine months ended
       September 30, 2002, was $8,181. Positive financing cash flows related
       primarily to the proceeds from debt and from the sale of common stock
       offset by payments on debt.

       The Company issued $2,432,676 of 9.25% convertible subordinated
       debentures in the nine months ended September 30, 2002. The debentures
       were for one to nineteen months and were convertible in common stock at a
       rate of $.50 per share. The debentures contained no immediate beneficial
       conversion features.

<PAGE>


                                       15


       The Company issued $103,920 of short term notes payable in the nine
       months ended September 30, 2002.

       DISCONTINUED OPERATIONS

       Triple-C-Inc., a subsidiary of the Company, had a revolving line of
       credit facility with Congress Financial Corporation (Congress). Under the
       terms of the agreement, borrowings were due on demand and were
       collateralized by substantially all Triple-C-Inc.'s assets. The line of
       credit had requirements relating to tangible net worth, additional debt,
       and dividends, among other requirements. Over the seven months ended July
       31, 2002, Congress reduced availability under the line of credit severely
       limiting Triple-C-Inc.'s access to vital working capital. On August 1,
       2002, the Company sought an order appointing Mintz & Partners Limited
       (Mintz) as interim receiver of Triple-C-Inc. On the same day,
       Triple-C-Inc. made an assignment pursuant to the provisions of the
       Bankruptcy and Insolvency Act (Canada), naming Mintz as trustee. Also on
       August 1, 2002, subject to the making of the Approval and Vesting Order,
       Mintz agreed to sell to Johnvince Foods, Ltd. (Johnvince), and Johnvince
       agreed to buy from Mintz, all of Mintz's and Triple-C-Inc.'s right,
       title, and interest in substantially all Triple-C-Inc.'s assets. On
       August 8, 2002, the Supreme Court of Ontario appointed Mintz as the
       interim receiver and approved the sale of the assets by issuance of an
       Approval and Vesting Order. The purchase price for the assets was not
       sufficient to satisfy the unsecured debts of Triple-C-Inc. The assets,
       liabilities, operations, and cash flows of Triple-C-Inc. were previously
       included in the consolidated amounts in the condensed consolidated
       financial statements. The Triple-C-Inc. net assets have been reclassified
       to the carrying value of discontinued subsidiary at December 31, 2001,
       and the operations of Triple-C-Inc. are included in discontinued
       operations.

Item 3. Controls and Procedures.

       Within the 90 days prior to the date of this report, the Company carried
       out an evaluation, under the supervision and with the participation of
       the Company's management, including the Company's Chief Executive
       Officer, who is also the Company's Chief Financial Officer, of the
       effectiveness of the design and operation of the Company's disclosure
       controls and procedures pursuant to Exchange Act Rule 13a-14. Based upon
       the evaluation, the Chief Executive Officer, who is also the Company's
       Chief Financial Officer, concluded that the Company's disclosure controls
       and procedures are effective. There were no significant changes in the
       Company's internal controls or in other factors that could significantly
       affect these controls subsequent to the date of his evaluation.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

       None

Item 2. Changes in Securities

       Issuance of Common Stock

       On August 7, 2002, the Company issued common stock to certain parties
       known to the Company as follows: (i) 170,000 shares to three individuals,
       including 70,000 shares to two Directors of the Company, in exchange for
       services provided to the Company and (ii) 50,000 shares to a Director of
       the Company in exchange for cash.

<PAGE>


                                       16


       Providers of services to the Company agreed to accept common stock of the
       Company in lieu of cash compensation. All issuances of common stock were
       unregistered in reliance upon Section 4(2) of the Securities Act of 1933.
       There were no offering expenses incurred by the Company in conjunction
       with these issuances.

       Convertible Debenture Offerings

       On August 31, 2002, the Company issued or reissued convertible debentures
       to two individual purchasers in the amount of $907,725. Included in this
       amount was a debenture for $45,000 which was issued in exchange for
       services. The debentures vary in term from one to twelve months, are
       convertible into common stock of the Company at a conversion rate of $.50
       per share, and were issued to certain parties known to the Company.

       The issuances of the convertible debentures were exempt from registration
       in the United States under Section 4(2) of the Securities Act of 1933. As
       of the date of this report none of the convertible debentures issued in
       2002 have been converted into common stock of the Company. No offering
       expenses were incurred in conjunction with these issuances.

       Warrant Issuances

       No warrants to purchase common shares were issued during the three months
       ended September 30, 2002.

       Stock Option Issuances

       No stock options were issued during the three months ended September 30,
       2002.

Item 3. Defaults Upon Senior Securities

       At September 30, 2002, convertible debentures in the principal amount of
       $2,201,958 are past due. Interest accrued through September 30, 2002, in
       the amount of $122,804 relating to the debentures is included in accrued
       expenses.

       At September 30, 2002, notes payable in the principal amount of $183,345
       are past due. Interest accrued through September 30, 2002, in the amount
       of $77,760 relating to the notes payable is included in accrued expenses.

Item 4. Submission of Matters to a Vote of Security Holders

       None.

Item 5. Other Information

       None.

<PAGE>


                                       17

Item 6. Exhibits and Reports on Form 8-K

       Exhibit No.   Description
       -----------   -----------
       3.1.1         Restated Articles of Incorporation*
       3.1.2         Amendment to Articles of Incorporation*
       3.1.3         Notice of Change of Registered Office/Registered Agent*
       3.1.4         Bylaws*
       3.1.5         Amendment to Articles of Incorporation****
       10.1          Employment Agreement - Lawrence Castriotta*
       10.3(1)       Real Property Lease - Menomonie, Wisconsin*
       10.6(1)       Specimen of Convertible Debentures*
       10.7          Gardner Resources License Agreement**
       10.8          Gardner Resources Private Label Agreement**
       10.9          Amendment to Employment Agreement - Lawrence Castriotta***
       11            Statement Regarding Computation of Earnings Per Share
       21            Subsidiaries of Registrant*
       99.1          Certification Pursuant to 18 U.S.C. Section 1350, as
                     Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act
                     of 2002


       *    Previously filed with the Company's Form 10-SB dated November 30,
            2000.
       **   Previously filed with the Company's Amendment Number One to Form
            10-SB dated January 16, 2001.
       ***  Previously filed with Company's Form 10-QSB dated May 15, 2001.
       **** Previously filed with Company's Form 10-QSB dated November 14, 2001.



       The Company filed a report on Form 8-K on August 30, 2002 relating to
       bankruptcy and sale of assets of Triple-C-Inc.


                                    SIGNATURE

       In accordance with the requirements of the Exchange Act, the registrant
       caused this report to be signed on its behalf by the undersigned,
       thereunto duly authorized.

                                        Rachel's Gourmet Snacks, Inc.

            DATE: October xx, 2002      By: /s/ Lawrence Castriotta
                                            -----------------------
                                            Lawrence Castriotta
                                            Its Chief Executive Officer

<PAGE>


                                       18


        CERTIFICATION UNDER SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

         I, Lawrence Castriotta, the Chief Executive Officer and Chief Financial
Officer of the Company, certify that:

         1. I have reviewed this quarterly report on Form 10-QSB of Rachel's
Gourmet Snacks, Inc.;

         2. Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by this
quarterly report;

         3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

         4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

         a) designed such disclosure controls and procedures to ensure that
         material information relating to the registrant, including its
         consolidated subsidiaries, is made known to us by others within those
         entities, particularly during the period in which this quarterly report
         is being prepared;

         b) evaluated the effectiveness of the registrant's disclosure controls
         and procedures as of a date within 90 days prior to the filing date of
         this quarterly report (the "Evaluation Date"); and

         c) presented in this quarterly report our conclusions about the
         effectiveness of the disclosure controls and procedures based on our
         evaluation as of the Evaluation Date;

         5. The registrant's other certifying officers and I have disclosed,
based on our most recent evaluation, to the registrant's auditors and the audit
committee of registrant's board of directors (or persons performing the
equivalent functions):

         a) all significant deficiencies in the design or operation of internal
         controls which could adversely affect the registrant's ability to
         record, process, summarize and report financial data and have
         identified for the registrant's auditors any material weaknesses in
         internal controls; and

         b) any fraud, whether or not material, that involves management or
         other employees who have a significant role in the registrant's
         internal controls; and

         6. The registrant's other certifying officers and I have indicated in
this quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.



                                        By: /s/Lawrence Castriotta
                                            ----------------------
             Dated: October xx, 2002        Lawrence Castriotta
                                            Chief Executive Officer and
                                              Chief Financial Officer