SPIN-OFF AGREEMENT

AGREEMENT  dated  September  19, 1996 by and between  Kushi  Natural Foods Corp.
("Foods") and Kushi Macrobiotics Corp. ("KMC"), each a Delaware corporation.

WHEREAS, Foods and KMC are parties,  together with American Phoenix Group, Inc.,
a Nevada  corporation  ("APHX") to a certain Amended and Restated  Agreement and
Plan of Merger, dated August 12, 1996 (the "Merger Agreement"); and

WHEREAS,  since  its  inception,  KMC  has  been  engaged  in  the  business  of
developing,  marketing and selling a product line comprised of macrobiotic foods
(the ("Macrobiotic Food Business"); and

WHEREAS.,  the Merger Agreement  provides that at the Effective Time (as defined
in the Merger  Agreement),  APHX will merge with and into KMC (the "Merger") and
simultaneously  therewith KMC will transfer its  Macrobiotic  Foods  Business to
Foods in  exchange  for shares of the  Common  Stock,  par value  .0001 of Foods
("Foods  Shares"),  which shall be distributed to the  stockholders of KMC as of
immediately prior to the Effective Time; and

WHEREAS, the Merger Agreement further provides for the execution and delivery of
an Indemnification Agreement in favor of the surviving corporation

NOW  THEREFORE,  in  consideration  of the  mutual  covenants,  representations,
warranties  and  agreements  set  forth  in the  Merger  Agreement  and in  this
Agreement, the parties hereby agree as follows:

1 . Transfer and Assignment of Operational Assets; Assumption of Liabilities.

1.1 KMC  agrees to  transfer  and  assign to Foods all of its  right,  title and
interest in and to assets of every nature,  kind and  description,  tangible and
intangible,  used,  held or owned by KMC in  connection  with the conduct of the
Macrobiotic  Food Business  exclusive of KMC's right,  title and interest in the
premises leased by it located at 2 Cranberry Road,  Parsippany,  New Jersey (the
"Parsippany Premises") and the premises located at Three Stamford Landing, Suite
210,  Stamford,   Connecticut  (the  "Stamford  Premises")  (the  assets  to  be
transferred  hereunder  being  hereinafter  referred to as the "KMC  Operational
Assets".  The transfer and assignment of the KMC Operational Assets shall become
effective as of the  Effective  Time without the necessity of any further act by
either KMC or Foods.

1.2 Foods hereby agrees to assume all of the  obligations and liabilities of KMC
which now exist or which may hereafter arise relating to or arising from the KMC
Operational  Assets or to the conduct of Macrobiotic  Foods Business at any time
from its  inception  to the  Effective  Time,  except for such  obligations  and
liabilities which arise from or relate to the interests of KMC in the Parsippany
Premises or the  Stamford  Premises.  The  assumption  of such  obligations  and
liabilities by Foods shall become effective as of the Effective Time without the
necessity of any further acts by either KMC

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or Foods.

2. Issuance of Shares of Food.

     2.1 In consideration for the transfer and assignment to Foods of all of the
KMC Operational  Assets,  Foods shall issue to KMC that number of Food Shares as
shall be equal to three times the number of shares the Common Stock,  par value,
 .001 per  share,  of KMC as  shall  be  outstanding  immediately  preceding  the
Effective  Time, such issuance of stock to be effective as of the Effective Time
of the Merger.

3. Closing .

3.1 A closing (the  "Closing")  hereunder shall take place at the Effective Time
(or as soon as practicable thereafter),

3.2 At the Closing, KMC shall: (i) KMC shall execute and deliver to Foods a bill
of sale and license in substantially the form of Exhibit A hereto, together with
such other  instruments  of transfer and  assignment  as Foods shall  reasonably
request in order to effect the  transfer and  assignment  to Foods of all of the
KMC  Operational  Assets;  (ii) execute and deliver to Foods the  Indemnity  and
Escrow  Agreement  in  substantially  the form of  Exhibit B  hereto,  and (iii)
execute and deliver to Foods a certificate of the President and Secretary of KMC
as to the fulfillment to the conditions to the performance by Foods set forth in
Article 5 hereof.

3.3 At the Closing,  Foods shall: (i) deliver to KMC a certificate  representing
the  shares  of Foods to be  issued  in  accordance  with  Section  2. 1 hereof,
together  with a  certificate  of the President and Secretary of Foods as to the
valid issuance and authorization of such shares and the fulfillment of the other
conditions  to the  performance  by KMC set forth in Article 5 hereof,  and (ii)
execute and deliver to KMC the Indemnity and Escrow Agreement.

4. Representations and Warranties.

4.1 Each of the parties hereto  represents and warrants to each other party that
it is a corporation  duly  incorporated,  validly  existing and in good standing
under laws of its jurisdiction of incorporation and that the execution, delivery
and performance by it of this Agreement and the transactions contemplated hereby
has been duly authorized by all necessary corporate action.

4.2 Foods  hereby  represents  and  warrants  that the Foods Shares to be issued
pursuant to Section 2.1 hereof, will be, upon such issuance, duly authorized and
validly issued, fully paid,  non-assessable and free of preemptive rights. Foods
further  warrants that on and as of the  Effective  Time the Foods Shares issued
pursuant  to Section  2.1 shall  constitute  all of the  issued and  outstanding
capital stock of Foods and that there are no subscriptions, options, warrants or
other rights, calls,  agreements or commitments or obligations of Foods to issue
its capital stock.



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5. Conditions to the Obligation of the Parties.

The obligation of each party to consummate the transactions contemplated by this
Agreement shall be subject to the satisfaction by the other party on or prior to
the Effective Time of the following conditions:

5.1 The  representations  and  warranties of such other party  contained in this
Agreement or any document to be delivered by such party to this Agreement  shall
be true and correct in all material  respects at and as of the Effective Time as
though such  representations and warranties were made on and as of the Effective
Time.

5.2 Such other party shall have performed and complied in all material  respects
with all of obligations under this Agreement.

6.0 Termination.  In the event of the termination of the Merger Agreement,  this
Agreement  shall  forthwith  become void and there shall be no  liability on the
part of any of the parties hereto or their respective officers and directors.

7.0 Miscellaneous.

7.1 This  Agreement may be amended only by written  agreement  between Foods and
KMC.

7. 2. Except as otherwise provided in this Agreement,  any failure of any of the
parties to comply with any obligation,  covenant or agreement  contained  herein
may be waived only by a written notice from the party or parties entitled to the
benefits  thereof.  No failure by any party hereto to exercise,  and no delay in
exercising,  any right hereunder,  shall operate as a waiver thereof,  nor shall
any single or partial  exercise  of any right  hereunder  preclude  any other or
future exercise of that right by that party.

7.3 All  notices and other  communications  hereunder  shall be deemed  given if
given in writing and delivered  personally,  by  registered  or certified  mail,
return receipt requested,  postage prepaid, or by overnight courier to the party
to receive the same at its respective  address set forth below (or at such other
address  as may from time to time be  designated  by such party to the others in
accordance with this Section 7.3):

(a) if to KMC, to:

                                    American Phoenix Group, Inc.
                                    5 Park Plaza, Suite 1260
                                    Irvine, California 92714

(b) if to Foods, to:

All such  notices  and  communications  hereunder  shall be  deemed  given  when
received, as evidenced

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by the signed  acknowledgment  of  receipt of the person to whom such  notice or
communication  shall  have been  personally  delivered,  the  acknowledgment  of
receipt  returned  to the sender by the  applicable  postal  authorities  or the
confirmation of delivery rendered by the applicable overnight courier service.

7.4 This  Agreement and all of the  provisions  hereof shall be binding upon and
inure to the benefit of the parties hereto and their  respective  successors and
permitted assigns.  Neither this Agreement nor any rights, duties or obligations
hereunder  shall be assigned or delegated by any party hereto  without the prior
written consent of the other parties hereto.

7.5 Neither this Agreement nor any provision hereof nor any certificate or other
instrument  delivered  pursuant  hereto,  nor any  agreement  to be entered into
pursuant hereto or any provision hereof, is intended to create any right,  claim
or remedy in favor of any person or entity,  other than the  parties  hereto and
their respective successors and permitted assigns.

7.6 This Agreement may be executed in any number of counterparts,  each of which
shall be deemed an original,  but all of which together shall constitute one and
the same instrument.

7.7 This Agreement,  and the  certificates  and other  instruments and documents
delivered  pursuant  thereto,  together  with the other  agreements  referred to
herein and to be entered into pursuant  hereto,  embody the entire  agreement of
the  parties and there are no other  agreements  or  understandings,  written or
oral, among the parties  relating to, the subject matter hereof.  This Agreement
supersedes all prior agreements and understandings, written or oral, between the
parties.

7.8 The parties hereby agree that this  Agreement,  and the  respective  rights,
duties and  obligations  of the  parties  hereunder,  shall be  governed  by and
construed in accordance  with the laws of the State of New York,  without giving
effect to principles of conflicts of law thereunder.

7.9 The parties  hereto agree that  irreparable  damage would occur in the event
this Agreement were not to be performed in accordance  with the terms hereof and
that the parties shall be entitled to specific  performance  of the terms hereof
in addition to any other remedies at law or equity.

IN WITNESS WHEREOF, KMC and Foods bove caused this Agreement to be duly executed
and delivered as of the date first above written.

KUSHI MACROBIOTICS CORP.
By: /s/ Daniel A. France
    -----------------------------------------------------
         Name:     Daniel A. France
         Title:   V.P., Chief Operating/Financial Officer

KUSHI NATURAL FOODS CORP.
By: /s/ Michio Kushi
    -----------------------------------------------------
         Name:    Michio Kushi
         Title:   Chairman - CEO

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