As filed with the Securities and Exchange Commission on May 7, 1996
                                                           Registration No. 333-

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                              --------------------
                                    FORM S-8
                             REGISTRATION STATEMENT
                                      UNDER
                           THE SECURITIES ACT OF 1933
                              --------------------

                     THE GREAT AMERICAN BACKRUB STORE, INC.

          New York                                          13-3729043
(State or other jurisdiction of                          (I.R.S. Employer
incorporation or organization)                           Identification No.)

    425 Madison Avenue, Suite 605
    New York, New York                                          10017
(Address of principal executive offices)                      (Zip Code)

                              --------------------

                     The Great American BackRub Store, Inc.
             1994 Employee Stock Option Plan and Purchase Agreements
                            (Full Title of the Plan)

                              --------------------

                                 William Zanker
                                    President
                     The Great American Backrub Store, Inc.
                          425 Madison Avenue, Suite 605
                            New York, New York 10017
                     (Name and Address of agent for service)

                                  (212)750-7046
          (Telephone number, including area code, of agent for service)

                              --------------------

                                 With a copy to:
                               Stephen Irwin, Esq.
                     Olshan Grundman Frome & Rosenzweig LLP
                                 505 Park Avenue
                            New York, New York 10022
                                 (212) 753-7200

                              --------------------

             Approximate date of proposed sale pursuant to the Plan:
               From time to time after the effective date of this
                             registration statement.

                              --------------------
<TABLE>
<CAPTION>
                         CALCULATION OF REGISTRATION FEE
========================================================================================================================
                                                         Proposed               Proposed
                                                          Maximum                Maximum
         Title of                Amount                  Offering               Aggregate              Amount of
        Securities               to be                     Price                Offering             Registration
     to be Registered          Registered                Per Share                Price                   Fee
- ------------------------------------------------------------------------------------------------------------------------
<C>                        <C>                           <C>                 <C>                        <C>    
Common Stock,
$.001 par value              5,000(1)(2)                 $3.4375(1)          $17,187.50(1)                $5.93
- ------------------------------------------------------------------------------------------------------------------------
Common Stock,
$.001 par value             70,000(2)(3)                 $4.50(3)              $315,000(3)              $108.62
- ------------------------------------------------------------------------------------------------------------------------
Common Stock,
$.001 par value            615,000(2)(4)                 $3.03(4)            $1,863,450(4)              $642.57
- ------------------------------------------------------------------------------------------------------------------------
Total Registration Fee.........................................................................         $757.12
========================================================================================================================
</TABLE>
<PAGE>

(1)      Represents 5,000 shares with respect to which options were granted
         under the Registrant's 1994 Employee Stock Option Plan (the "Employee
         Plan") at an exercise price of $3.4375 per share.
(2)      Pursuant to Rule 416, an indeterminate number of shares of Common Stock
         that may become issuable pursuant to antidilution provisions of the
         Employee Plan and the various other written purchase agreements and
         written compensation contracts pursuant to which options were granted
         by the Registrant (collectively, the "Purchase Agreements") are also
         being registered.
(3)      Represents 70,000 shares of Common Stock with respect to which options
         have not yet been granted under the Employee Plan.  Pursuant to Rule
         457(g) and (h), the offering price for these shares of Common Stock
         which may be issued under the Employee Plan is estimated solely for the
         purpose of determining the registration fee and is based on $4.50, the
         per share average of high and low sale prices of the Common Stock as
         reported by the Nasdaq SmallCap Market on May 1, 1996.
(4)      Shares of Common Stock with respect to which options have been granted
         under the Purchase Agreements at an average exercise price of $3.03 per
         share to certain employees, directors and consultants of the Company.

================================================================================

                                       -2-
<PAGE>
PROSPECTUS
                                 665,000 SHARES

                     THE GREAT AMERICAN BACKRUB STORE, INC.
                     Common Stock, $.001 par value per share


         This  Prospectus  relates to the reoffer and resale by certain  selling
shareholders  (the "Selling  Shareholders")  of 655,000 shares (the "Shares") of
Common  Stock,  $.001  par value per share  (the  "Common  Stock")  of The Great
American  BackRub Store,  Inc. (the "Company") that may be issued by the Company
to the Selling  Shareholders  upon the  exercise of  outstanding  stock  options
granted  under (a) the  Company's  1994  Employee  Stock  Option Plan (the "1994
Plan") and (b) various  written  purchase  agreements  and written  compensation
contracts  (collectively,  the  "Purchase  Agreements").  This  Prospectus  also
relates to the  reoffer  and resale of Shares to be  acquired  upon  exercise of
stock options that may be granted to individuals who may be deemed  "affiliates"
of the  Company  (collectively,  the  "Future  Selling  Shareholders")  upon the
exercise of outstanding  stock options to be granted under the 1994 Plan. If and
when such options are granted to the Future  Selling  Shareholders,  the Company
intends to distribute a Prospectus  Supplement as required by Rule 424(b) of the
Securities  Act of 1933,  as amended (the  "Securities  Act").  Such  Prospectus
Supplement  will specify the names of the Future  Selling  Shareholders  and the
amount of Shares to be reoffered and sold by them.

         The offer and sale of the Shares to the Selling Shareholders and to the
Future Selling Shareholders were previously registered under the Securities Act.
The Shares are being reoffered and may be resold for the accounts of the Selling
Shareholders  and the  Future  Selling  Shareholders  and the  Company  will not
receive any of the proceeds from the resale of the Shares.

         The Selling  Shareholders  have  advised the Company that the resale of
their Shares may be effected  from time to time in one or more  transactions  on
the Nasdaq SmallCap Market ("Nasdaq"),  in negotiated  transactions or otherwise
at  market  prices  prevailing  at the time of the sale or at  prices  otherwise
negotiated.  See "Plan of  Distribution."  The Company will bear all expenses in
connection with the preparation of this Prospectus.

         The Common Stock is traded on Nasdaq under the symbol "RUBB". On May 1,
1996, the closing price for the Common Stock, as reported by Nasdaq, was $4.50.


            AN INVESTMENT IN THE COMMON STOCK OFFERED HEREBY INVOLVES
           A HIGH DEGREE OF RISK. SEE "RISK FACTORS" AT PAGE 3 HEREOF.


             THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED
              BY THE SECURITIES AND EXCHANGE COMMISSION NOR HAS THE
               COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
               THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
                             IS A CRIMINAL OFFENSE.

                   The date of this Prospectus is May 7, 1996.
<PAGE>
                              AVAILABLE INFORMATION

         The  Company  is  subject  to  the  informational  requirements  of the
Securities  Exchange  Act of 1934,  as  amended  (the  "Exchange  Act"),  and in
accordance therewith files reports,  proxy statements and other information with
the Securities and Exchange Commission (the "Commission").  Such reports,  proxy
statements  and other  information  can be  inspected  and  copied at the public
reference facilities  maintained by the Commission at Judiciary Plaza, 450 Fifth
Street, N.W.,  Washington,  D.C. 20549; or at certain of the regional offices of
the Commission located at 500 West Madison Street, Suite 1400, Chicago, Illinois
60661;  and Seven World Trade  Center,  Suite  1300,  New York,  New York 10048.
Copies of such material can be obtained from the Public Reference Section of the
Commission at Judiciary Plaza, 450 Fifth Street, N.W.,  Washington,  D.C. 20549,
at prescribed rates.

                                TABLE OF CONTENTS

                                                                        Page


     AVAILABLE INFORMATION................................................2

     INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE......................2

     RISK FACTORS.........................................................4

     GENERAL INFORMATION..................................................8

     RECENT DEVELOPMENTS..................................................9

     USE OF PROCEEDS.....................................................10

     SELLING SHAREHOLDERS................................................11

     PLAN OF DISTRIBUTION................................................12

     LEGAL MATTERS.......................................................12

     ADDITIONAL INFORMATION..............................................12


                 INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

         The  Company's  (i)  Annual  Report on Form  10-KSB  for the year ended
December 31, 1995 and (ii) Quarterly Report on Form 10-QSB for the quarter ended
March 31,  1996,  which  have been  filed with the  Commission  pursuant  to the
Exchange Act, are hereby  incorporated by reference in this Prospectus and shall
be deemed to be a part hereof.  All documents  filed by the Company  pursuant to
Sections  13(a),  13(c),  14 or 15(d) of the Exchange Act after the date of this
Prospectus  and  prior to the  termination  of this  offering  are  deemed to be
incorporated  by reference in this  Prospectus  and shall be deemed to be a part
hereof from the date of filing of such documents.

         The Company's  Application  for  Registration of its Common Stock under
Section 12(g) of the Exchange Act filed on February 23, 1995, is incorporated by
reference in this Prospectus and shall be deemed to be a part hereof.

         The Company hereby  undertakes to provide without charge to each person
to whom a copy of this  Prospectus  has been  delivered,  on the written or oral
request of any such person,  a copy of any or all of the  documents  referred to
above which have been or may be  incorporated  in this  Prospectus by reference,
other than

                                       -2-

<PAGE>

exhibits to such documents.  Written requests for such copies should be directed
to The Great American  BackRub Store,  Inc., 425 Madison Avenue,  Suite 605, New
York, New York 10017, Attention:  President. Oral requests should be directed to
such officer (telephone number (212) 750-7046).

                              --------------------

         No dealer,  salesman or other  person has been  authorized  to give any
information or to make any  representations  other than those  contained in this
Prospectus in connection with the offer made hereby, and, if given or made, such
information or representations must not be relied upon as having been authorized
by the Company or any Selling  Shareholder.  This Prospectus does not constitute
an offer to sell, or a solicitation  of an offer to buy, the securities  offered
hereby to any person in any state or other  jurisdiction  in which such offer or
solicitation  is unlawful.  The delivery of this Prospectus at any time does not
imply that information  contained herein is correct as of any time subsequent to
its date.

                                       -3-

<PAGE>

                                  RISK FACTORS

         THE   SECURITIES   OFFERED  HEREBY  INVOLVE  A  HIGH  DEGREE  OF  RISK.
PROSPECTIVE  INVESTORS  SHOULD  CAREFULLY  CONSIDER THE  FOLLOWING  RISK FACTORS
BEFORE MAKING AN INVESTMENT DECISION.

REPORT OF INDEPENDENT  CERTIFIED  PUBLIC  ACCOUNTANTS  CONTAINING AN EXPLANATORY
PARAGRAPH THAT INDICATES GOING CONCERN UNCERTAINTIES.  The Company's independent
certified  public  accountants  have included an explanatory  paragraph in their
report  on  the  Company's  Financial  Statements  stating  that  the  Financial
Statements  have been  prepared  based on the  assumption  that the Company will
continue as a going concern and that the Company's  losses from operations since
inception raise  substantial  doubt about the ability of the Company to continue
as a going concern.

DEVELOPMENT STAGE COMPANY;  LIMITED  OPERATING HISTORY AND REVENUES;  HISTORICAL
AND  ANTICIPATED  LOSSES;  ACCUMULATED  DEFICIT.  The Company was  organized  in
December  1992,   commenced   operations  in  August  1993,   opened  its  first
Company-owned  store in  October  1993 and  therefore  has a  limited  operating
history  upon  which an  evaluation  of the  Company's  future  performance  and
prospects can be made.  The Company's  prospects  must be considered in light of
the risks, expenses, delays, problems and difficulties frequently encountered in
the establishment of a new business in an emerging and evolving industry.  Since
inception,   the  Company  has  generated  limited  revenues  and  has  incurred
significant  losses,  including  losses of $1,118,975,  $2,647,255 and $597,870,
respectively,  for the  years  ended  December  31,  1994 and 1995 and the three
months  ended March 31, 1996  resulting,  at March 31, 1996,  in an  accumulated
deficit  of  $4,774,065.   Losses  are  continuing  through  the  date  of  this
Prospectus.  Inasmuch as the Company continues to have a high level of operating
expenses  and will be  required to make  significant  up-front  expenditures  in
connection with its proposed expansion, the Company anticipates that losses will
continue  for at least the next 12 months and until such time,  if ever,  as the
Company is able to generate  sufficient  revenues to finance its  operations and
the costs of continuing  expansion.  Since inception,  the Company's  operations
have generated negative cash flow, as its expenses have exceeded  revenues,  and
the Company's  ability to continue its  operations  has been dependent upon debt
and equity  financings.  There can be no assurance that the Company will be able
to generate  significant  revenues or achieve profitable  operations or that its
operations will generate positive cash flow.

NEW INDUSTRY;  UNCERTAINTY OF MARKET ACCEPTANCE.  As is typically the case in an
emerging  industry,  demand and market acceptance for newly introduced  services
and products are subject to a high level of uncertainty. The Company has not yet
commenced  significant marketing activities or studies and currently has limited
marketing  experience  in the retail back rub  business  and limited  financial,
personnel and other  resources to undertake  extensive  marketing  activities or
studies.  The Company  does not intend to conduct any formal  marketing or other
concept feasibility studies to determine the potential  commercial  viability of
its concept. Achieving market acceptance for the Company's services and products
will require substantial  marketing efforts and expenditure of significant funds
to create awareness and demand.  The Company's  success depends in large part on
its ability to attract  suitable  franchisees  and will also be dependent on the
level of  acceptance  and  usage  of the  Company's  services  and  products  by
consumers.  Because  demand by  prospective  franchisees  and  consumers  may be
interrelated,  any  lack  or  lessening  of  demand  by any one of  these  could
adversely affect market acceptance for the Company's  services and products.  In
light of the relatively  undeveloped and emerging  markets for retail back rubs,
there can be no assurance that a substantial  market for the Company's  services
and products will develop and grow.

RISKS  ASSOCIATED  WITH GROWTH  STRATEGY  AND RAPID  EXPANSION.  The Company has
achieved only limited growth to date.  Implementation of the Company's  proposed
expansion will be substantially dependent on, among other things, the Company's

                                       -4-

<PAGE>

ability  to  identify  and  secure  advantageous  locations  and  leases for its
Company-owned  and franchised  stores on a timely basis and on favorable  terms;
hire and retain skilled  management,  financial,  marketing and other personnel;
and successfully  manage growth (including  monitoring  operations,  controlling
costs and maintaining  effective quality,  inventory and service controls).  The
Company's  prospects  will also be  significantly  affected  by its  ability  to
successfully  develop  and  maintain  relationships  with its  franchisees.  The
Company's  growth  strategy  and  plans are  subject  to change as a result of a
number of  factors,  including  progress  or delays in the  Company's  marketing
efforts,  changes in market conditions and competitive factors.  There can be no
assurance that the Company will be able to  successfully  implement its business
strategy or otherwise expand its operations.

FRANCHISING.  The Company's  success will be dependent upon the  development and
implementation   of  an  effective   franchise   program,   which  would  afford
unaffiliated  parties the opportunity to own and operate Great American  BackRub
Stores using the  Company's  concept.  The Company  intends to include in such a
program  criteria to evaluate  franchisees.  However,  there can be no assurance
that the  Company  will be able to manage such a program  effectively,  that its
franchisees will have the ability or resources necessary to successfully develop
and operate their stores or that such franchisees'  stores will be well operated
and  promoted.  In  addition,  the  Company  intends  to lease the space for any
franchised stores directly from the landlord and sublease to the franchisee. The
Company will be primarily  liable for any such leases and may be required to pay
the landlord directly if the franchisee fails to do so.

DEPENDENCE  ON PROCEEDS OF INITIAL  PUBLIC  OFFERING  TO FINANCE  EXPANSION  AND
WORKING  CAPITAL;  POSSIBLE NEED FOR ADDITIONAL  FINANCING.  The Company remains
dependent on the proceeds of the its initial public offering  completed in March
1995 (the "IPO") and other future financings to implement its proposed expansion
and to finance its working capital requirements.  The Company anticipates, based
on  currently  proposed  plans  and  assumptions   relating  to  its  operations
(including  the costs  associated  with its  proposed  expansion),  that the net
proceeds  of the  IPO  will  be  sufficient  to  satisfy  its  anticipated  cash
requirements  at least  through July 1996.  The Company will be required to seek
additional  financing to implement  its  proposed  expansion  and to finance its
working capital requirements. To the extent that the Company incurs indebtedness
or issues debt securities,  the Company will be subject to risks associated with
incurring substantial indebtedness,  including the risks that interest rates may
fluctuate and cash flow may be insufficient to pay principal and interest on any
such indebtedness.  The Company has no current  arrangements with respect to, or
sources  of,  additional  financing,  and it is not  anticipated  that  existing
shareholders  will  provide  any  portion  of  the  Company's  future  financing
requirements.  There  can be no  assurance  that  additional  financing  will be
available  to the  Company on  commercially  reasonable  terms or at all. If the
Company  is unable to  obtain  additional  financing,  its  ability  to meet its
current  obligations  and  current  plans  for  expansion  could  be  materially
adversely affected.

POTENTIAL LIABILITY; INSURANCE. The Company is engaged in a business which could
expose it to possible  liability claims from others,  including  personal injury
claims.  The Company  maintains  a general  liability  insurance  policy that is
subject to a $1,000,000 per occurrence limit with a $1,000,000  aggregate limit.
Currently,  the  Company  requires  all of  its  employee/therapists  to  obtain
professional  liability  insurance (in the minimum amount of $1,000,000) through
one of two  professional  massage  organizations.  In some cases, the Company is
permitted under the applicable policy to be named as an additional  insured.  In
addition,  the  Company  has  obtained a  professional  liability  policy for an
additional $1,000,000 covering all of its employees.  There can be no assurance,
however,  that the Company's  insurance  will be  sufficient to cover  potential
claims or that an adequate  level of coverage will be available in the future at
a reasonable cost. A partially insured or completely  uninsured successful claim
against the Company could have a material adverse effect on the Company.

                                       -5-

<PAGE>


REGULATION.  Certain states in which the Company intends to operate,  as well as
the  State of New  York,  in which  the  Company  currently  operates  its eight
Company-owned  stores,  require the licensing of massage therapists.  The offer,
sale,  termination  or renewal of  franchises in the United States is subject to
requirements  established  by the  Federal  Trade  Commission  (the  "FTC").  In
addition to the requirements of the FTC, certain states require that franchisors
register in the state prior to offering  franchises in such states.  The Company
believes that it is in compliance  with all applicable  laws and regulations and
has all required licenses to conduct its business.  However, no assurance can be
given that current laws or regulations applicable to the Company's business will
not change. Any such new laws or regulations or the Company's expansion into new
geographic  areas could  subject the  Company to  substantial  costs in order to
comply with such applicable  laws or regulations.  Any failure by the Company to
comply with any new or existing laws or regulations could subject the Company to
substantial penalties.

COMPETITION.  Management  of the  Company  believes  that  no  other  multi-unit
retailer is in the business in which the Company operates.  Competition consists
of  numerous  independent  massage  therapists,  spas,  salons and health  clubs
providing full body massage and a limited number of massage therapists providing
seated  massage  in  non-retail  "off-site"  environments.  However,  due to the
relatively  low cost of, and lack of other barriers to, entry into the Company's
business,  no  assurance  can be given that others  will not develop  multi-unit
retail concepts or stores similar to or competitive  with the Company's  concept
and  stores  or that  the  Company  will  successfully  compete  with  any  such
competitors,  some of whom may have  substantially  greater  financial and other
resources than the Company.

DEPENDENCE ON KEY  PERSONNEL;  ATTRACTION  AND RETENTION OF KEY  PERSONNEL.  The
Company  is  dependent  to a great  extent,  on the  experience,  abilities  and
continued  services  of Mr.  Zanker,  the  Company's  Chairman  of the Board and
President and Mr.  Murray,  the Company's  Chief  Executive  Officer.  While the
Company's management has substantial  national retail and franchise  experience,
no assurance can be given that such prior  experience  will assure the Company's
success.  In addition,  the Company's  management has no prior  experience  with
companies  offering  products  and  services  similar  to those  offered  by the
Company. The Company has entered into three-year employment agreements with each
of Messrs.  Zanker and Murray which expire on October 31, 1997.  The loss of the
services of Messrs.  Zanker and Murray could have a material  adverse  effect on
the Company.  The Company has obtained  $2,000,000  of key man  insurance on the
lives of each of Messrs.  Zanker and Murray.  The Company's success also depends
upon its ability to attract and retain  qualified  massage  therapists and other
additional  qualified  personnel.  While the Company believes there are numerous
qualified massage therapists currently available, competition for such personnel
may become intense.  There can be no assurances that the Company will be able to
attract and retain qualified personnel.

POSSIBLE IMMEDIATE AND SUBSTANTIAL  DILUTION. At March 31, 1996, the Company had
a net tangible book value of approximately $1.46 per share. If purchasers of the
Common Stock offered hereby  purchase such shares at a price higher than the net
tangible book value per share, they will experience  dilution in an amount equal
to the  difference  between  the price per share they paid and the net  tangible
book value per share.

NO DIVIDENDS. The Company has never paid a dividend on its Common Stock and does
not intend to pay any dividends to its  shareholders in the foreseeable  future.
The Company currently intends to reinvest  earnings,  if any, in the development
and expansion of its business.

NO ASSURANCE OF CONTINUED PUBLIC MARKET;  POSSIBLE  VOLATILITY OF MARKET.  There
can be no assurance  that a regular  trading market for the Common Stock will be
sustained. The market price of the Common Stock may be highly volatile as has

                                       -6-

<PAGE>

been the case with the  securities of many emerging  companies.  Factors such as
the  Company's  operating  results  and  announcements  by  the  Company  or its
competitors  of new  products or services  may  significantly  impact the market
price of the  Company's  securities.  In addition,  in recent  years,  the stock
market has  experienced a high level of price and volume  volatility  and market
prices  for the  securities  of  many  companies  have  experienced  wide  price
fluctuations  not  necessarily  related  to the  operating  performance  of such
companies. Although Laidlaw may make and certain dealers presently make a market
in the Common  Stock,  they are not obligated to do so and may cease such market
making activities at any time.

EFFECT OF  OUTSTANDING  OPTIONS AND  WARRANTS,  COMPANY'S  STOCK OPTION PLAN AND
REPRESENTATIVE'S WARRANTS;  DILUTIVE EFFECTS. As of the date of this Prospectus,
options and  warrants to purchase an  aggregate  of  1,225,000  shares of Common
Stock are issued and outstanding,  held by the Company's executive  officers,  a
former executive officer, consultants and a former consultant to the Company. In
connection  with a bridge  financing  consummated  in November 1994, the Company
issued the warrants (the "Bridge  Warrants") to purchase an aggregate of 137,500
shares of Common Stock  exercisable at a price of $2.50 per share.  In addition,
options  to  purchase  5,000  shares of Common  Stock are  presently  issued and
outstanding  under the  Employee  Plan.  The Company may from time to time issue
options under the Employee Plan to purchase up to an additional 70,000 shares of
Common Stock.  The Company agreed with the  underwriters in the IPO not to grant
or issue  options to purchase  more than 37,500 shares of Common Stock under the
Employee  Plan prior to  February  28,  1997.  The  Company  granted  options to
purchase an  aggregate  of 50,000  shares of Common  Stock to  directors  of the
Company.  In  connection  with  the  IPO,  the  Company  issued  and sold to the
representatives  of the several  underwriters in the IPO (the  "Representative")
for  nominal  consideration  the  Representative's  Warrants  which  entitle the
Representative  to purchase an aggregate of 125,000 shares of Common Stock.  The
Representative's  Warrants are  exercisable  through  February  25, 2000,  at an
exercise price of $6.00 per share.  The Company  recently entered into an Option
Agreement  with the  Representative  which  provides  that in the event  certain
options  granted to the Company to  repurchase  shares of Common  Stock from the
Representative are exercised in full, the Representative's  Warrants will not be
exercisable prior to June 4, 1996. See "Recent Developments." The holders of the
options and warrants presently  outstanding,  holders of any subsequently issued
options and warrants of the Company, as well as the Representative will have the
opportunity  to  profit  from a rise in the  market  price of the  Common  Stock
without  assuming  the  risk of  ownership.  The sale of  Common  Stock or other
securities  held by or issuable to any such holders,  or merely the potential of
such  sales,  could  have an adverse  effect on the  market  price of the Common
Stock.  The  Company  may  find it more  difficult  to raise  additional  equity
capital,  if it should be needed for the business of the  Company,  while any of
such securities are  outstanding.  At any time when the holders thereof might be
expected to convert or exercise  them,  the  Company  would  probably be able to
obtain  additional equity capital on terms more favorable than those provided by
such  securities.  To the  extent  that any such  securities  are  converted  or
exercised,  as the case may be, the  percentage  of  ownership  interest  of the
Company's shareholders will be diluted.

SHARES  ELIGIBLE  FOR  FUTURE  SALE.  Of the  1,785,266  shares of Common  Stock
outstanding,  410,266 shares are "restricted  securities"  within the meaning of
the  Securities  Act  of  1933,  as  amended,  and  the  rules  and  regulations
promulgated  thereunder  (the  "Act")  and,  generally,  may  be  sold  only  in
compliance  with Rule 144 under the Act.  In  addition,  certain of the  410,266
shares are subject to lockup  restrictions  described  below.  Of the  remaining
1,375,000 shares, 125,000 shares, which represent shares of Common Stock sold by
the Company in a private  placement in June 1993,  are freely  tradeable and not
subject to lockup restrictions.  Of the 410,226 restricted  securities,  184,187
may be sold  pursuant  to Rule 144,  63,562 of which  shares are  subject to the
lockup  restrictions  described  below  and the  remaining  226,039  shares  are
available for sale under

                                       -7-

<PAGE>

Rule 144 at various  times  during  1996 and 1997,  of which  91,250  shares are
subject to the lockup restrictions described below. Under Rule 144, a person who
has held  restricted  securities  for a period  of two  years may sell a limited
number of such  securities  into the public market without  registration of such
securities  under the Act. Rule 144 also permits,  under certain  circumstances,
persons  who  are  not  affiliates  of the  Company  to  sell  their  restricted
securities  without  quantity  limitations  once they have  satisfied Rule 144's
three-year  holding  period.  Sales made  pursuant to Rule 144 by the  Company's
existing shareholders may have a depressive effect on the price of the shares of
Common Stock in the public market.  Such sales could also  adversely  affect the
Company's  ability to raise  capital at that time through the sale of its equity
securities.  All of the Company's officers and directors (who own 173,562 shares
in the aggregate) have agreed not to sell,  assign or transfer  154,812 of their
shares of Common  Stock for a period of eighteen  (18) months from  February 28,
1995 without the  Representative's  prior written consent.  The Company's Option
Agreement  with the  Representative  provides  that in the event the Options are
exercised in full,  the lock-up  agreements  entered into by Messrs.  Zanker and
Murray  and such 5% or  greater  shareholder  shall  become  null and void.  The
holders of the  Representative's  Warrants have certain registration rights with
respect to the Common Stock underlying such Warrants.

LISTING AND  MAINTENANCE  CRITERIA  FOR NASDAQ  QUOTATION.  The Common  Stock is
quoted on Nasdaq.  To continue to be quoted on Nasdaq,  the Company must satisfy
certain  maintenance  criteria,  including having (i) at least two market makers
for the Common  Stock,  (ii) total assets of at least $2 million,  (iii) capital
and  surplus of at least $1  million,  (iv) a minimum bid price per share of $1,
(v) at least 300 shareholders and (vi) a public float of at least 100,000 shares
with a market value of at least $200,000.  The failure to meet these maintenance
criteria  in the future may result in the Common  Stock not being  eligible  for
quotation on Nasdaq and trading, if any, of the Common Stock would thereafter be
conducted  on the OTC  Bulletin  Board.  As a result of such  ineligibility  for
quotation,  an investor  may find it more  difficult to dispose of, or to obtain
accurate quotations as to the market value of, the Common Stock.

                               GENERAL INFORMATION

         The Company is a development stage company engaged in the creation of a
national  chain of stores  under the name "The Great  American  BackRub  Store,"
which offer  reasonably-priced  back rubs to customers while they are seated and
fully  clothed  in a clean,  open,  non-threatening  environment.  The back rubs
currently offered by the Company are for 5, 10, 20, 30 or 45 minutes,  priced at
approximately $8.95, $14.95, $24.95, $34.95 and $49.95, respectively. By design,
The Great American BackRub Store is a specialty  interactive retailer offering a
wide range of massage and stress reduction products, including oils, bath salts,
back supports and electronic and mechanical  stress  reduction  devices  (priced
generally from $4.95 to $250.00). The Company believes that the combination of a
boutique retail concept with back rub services makes The Great American  BackRub
Store a unique shopping experience.

         The Company currently owns and operates seven retail stores in New York
City and one location in the  Westchester  Mall in White Plains,  New York.  The
Company plans to open  approximately  40  Company-owned  stores within two years
from the date of this  Prospectus and  additional  franchised  stores,  although
there can be no assurance  that the Company will be successful in this plan. The
Company  intends to place its stores in high  traffic  locations  such as malls,
airports, urban sites and casinos.

         The  typical  Great  American   BackRub  Store  location   consists  of
approximately  600 to 1,200  square  feet,  including  300 to 600 square feet of
retail space. Customers are seated on a specially-designed  chair which provides
cushioned  support  for the  chest,  arms and head.  The  Company's  stores  are
designed to permit people both inside and outside the store to view the back rub
process and

                                       -8-

<PAGE>
at the same time  maintain the privacy of the back rub  customer.  The Company's
stores  will also  offer  back rub  services  off-site,  to  corporate  offices,
convention centers and tourist  attractions.  All back rub services are provided
by  therapists  who are either  licensed  (in states  where  such  licensing  is
required) or have completed training at a school certified by a recognized trade
association.

         The  Company's  growth  strategy  is to  be  implemented  primarily  by
Terrance Murray, the Company's Chief Executive Officer, who previously served as
the executive vice president - operations of Supercuts,  Inc. Supercuts, Inc. is
a hair care chain with in excess of 1,000 company-owned and franchised stores in
43 states and Puerto Rico. The Company  believes that the  substantial  national
retail and franchise experience of Mr. Murray will be an asset to the Company.

         The Company was incorporated under the laws of the State of New York in
December  1992.  The  Company's  executive  offices  are  located at 425 Madison
Avenue,  Suite 605, New York,  New York 10017 and its telephone  number is (212)
750-7046.

                               RECENT DEVELOPMENTS

OPTION AGREEMENT

         On December 7, 1995, the Company entered into an option  agreement (the
"Option Agreement") with Laidlaw and the Selling  Shareholder  pursuant to which
Laidlaw granted the Company an option (the "First  Option") to purchase  100,000
shares of Common  Stock (the "First  Option  Shares") and an option (the "Second
Option" and together with the First Option,  the "Options") to purchase  375,000
shares of Common Stock (the "Second  Option  Shares" and together with the First
Option Shares, the "Option Shares").  The First Option may be exercised in whole
or in part,  at any time or from  time to time,  from the date  (the  "Effective
Date") the post-effective  amendment to the registration statement of which this
Prospectus  is a part is declared  effective by the  Commission to and including
June 7, 1996 (the  "Expiration  Date"),  after  which the First  Option,  to the
extent not previously  exercised,  will expire. The exercise price for the First
Option from the Effective Date to and including the fifth business day following
the Effective Date (the "Step-up  Date") shall be $3.50 per share.  The exercise
price for the First Option from the day  immediately  following the Step-up Date
until the Expiration Date shall be $4.00 per share.

         The Second  Option may be exercised in whole or in part, at any time or
from time to time,  from the Effective  Date until the  Expiration  Date,  after
which the Second Option,  to the extent not previously  exercised,  will expire.
The exercise price for the Second Option shall be $4.00 per share.

         The Option  Agreement  may be assigned by the  Company,  at any time or
from time to time in whole or in part,  without the consent of Laidlaw as to any
of the Options which are  simultaneously  therewith  being exercised by any such
assignee.  On April 24, 1996,  the Company  entered into an agreement with three
individuals (the "Holders") whereby the Company granted to the Holders the right
to cause the Company to assign the Second  Option to the Holders.  The agreement
expires on June 7, 1996 (the  "Termination  Date"). To the extent the Expiration
Date is extended,  the Termination  Date shall be extended to coincide with such
Expiration Date. The exercise price of the Second Option to the Holders is $5.00
per share.

FRANCHISE/FRANCHISE OPTION TERMINATIONS

         The Company's first  franchised store (the "Las Vegas Store") opened in
July 1994 in Las Vegas,  Nevada. The Company entered into a franchise  agreement
(the "Franchise  Agreement") with its Las Vegas franchisee (the "Franchisee") on
June 1, 1994.  Pursuant to the  Franchise  Agreement,  the  Franchisee  paid the
Company an initial,  non-recurring,  non-refundable franchise fee of $10,000. In
addition,

                                       -9-

<PAGE>

the  Franchisee  paid the  Company  a  monthly  royalty  fee  equal to 8% of the
Franchisee's  gross  monthly  revenues (as such term is defined in the Franchise
Agreement).  The Franchisee  also paid to the Company an  advertising  and sales
promotion  fee which is equal to the  greater  of 3% of the  Franchisee's  gross
monthly  revenues or $1,000.  On May 30,  1995,  the Company and the  Franchisee
entered  into a  franchise  termination  agreement  whereby  (i)  the  Franchise
Agreement  and related  sublease  were  terminated,  (ii) the Company  purchased
certain  assets from the  Franchisee  and (iii) the  Company and the  Franchisee
provided for the mutual release of any  obligations of each to the other whether
arising out of the Franchise Agreement,  the sublease or otherwise. The purchase
price for the assets  conveyed by the  Franchisee to the Company was $25,000 and
18,185 shares of Common  Stock.  Simultaneously  with the Franchise  Termination
Agreement, the Company closed the Las Vegas Store.

         The  Company   entered   into  two  option   agreements   (the  "Option
Agreements")  with  Bay Area  Backs I, a  California  limited  partnership  (the
"Optionee"),  on June 20, 1994 and June 21, 1994, respectively,  for the opening
of two  franchised  stores in the San  Francisco  area.  Pursuant  to the Option
Agreements, the Optionee paid to the Company $5,000 for each of two options (the
"Options") to require the Company to enter into  franchise  agreements  with the
Optionee.  On May 30, 1995, the Company and the Optionee  entered into an option
termination  agreement whereby (i) the Option  Agreements were terminated,  (ii)
the Company purchased certain assets from the Optionee and (iii) the Company and
the Optionee  provided for the mutual release of any  obligations of each to the
other whether  arising out of the Option  Agreements or otherwise.  The purchase
price for the assets conveyed by the Optionee to the Company and the termination
of the Options was $27,300.

CONSULTING AGREEMENT

         On February 8, 1996, the Company entered into a Financial  Advisory and
Consulting   Agreement  (the  "Financial  Advisory  Agreement")  with  Investors
Associates,  Inc.  ("Investors  Associates").  The Financial  Advisory Agreement
expires on January 31, 1997. As compensation for the services to be performed by
Investors   Associates  to  the  Company  pursuant  to  the  Financial  Advisory
Agreement,  the Company paid to Investors  Associates a financial consulting fee
of $100,000,  warrants to purchase 100,000 shares of Common Stock of the Company
at an exercise price of $1.00 per share exercisable to and including January 31,
1997, and warrants to purchase  200,000 shares of Common Stock of the Company at
an exercise price of $2.50 per share  exercisable  to and including  January 31,
1998.  The  Company  has  granted  certain   registration  rights  to  Investors
Associates  relating to the registration of the shares issuable upon exercise of
the warrants under the Securities Act of 1933, as amended.

         During  the  term  of  the  Financial  Advisory  Agreement,   Investors
Associates  will provide the Company with such regular and customary  consulting
advice as is reasonably requested by the Company.  Investors  Associate's duties
will include,  but will not necessarily be limited to (i) providing  sponsorship
and exposure in  connection  with the  dissemination  of  corporate  information
regarding  the Company to the  investment  community  at large,  (ii)  arranging
meetings with securities  analysts,  (iii) assisting in the Company's  financial
public  relations and (iv) rendering advice regarding a future public or private
offering of  securities  of the Company or of any of its  subsidiaries.  In this
regard,  Investors  Associates  has agreed to use its best efforts to assist the
Company in arranging  for a private  placement or public  offering of securities
with gross proceeds to the Company of at least $2 million.


                                 USE OF PROCEEDS

         The  Company  will  receive  the  exercise  price of the  options  when
exercised by the holders thereof. Such proceeds will be used for working capital
purposes

                                      -10-

<PAGE>

by the  Company.  The  Company  will not receive  any of the  proceeds  from the
reoffer and resale of the Shares by the Selling Shareholders.


                              SELLING SHAREHOLDERS

         This  Prospectus  relates to the reoffer and resale of Shares issued or
that may be issued to the Selling  Shareholders under the Purchase Agreements or
the 1994 Plan.

         The following table sets forth (i) the number of shares of Common Stock
beneficially  owned by each  Selling  Shareholder,  (ii) the number of Shares of
Common Stock to be offered for resale by each Selling  Shareholder and (iii) the
number  and  percentage  of shares of  Common  Stock to be held by each  Selling
Shareholder after completion of the offering.


                                                               Number of shares
                                                               of Common Stock/
                              Number of                         Percentage of
                              shares of         Number of        Class to be
                             Common Stock       Shares to        Owned After
                            Owned Prior to     be Offered       Completion of
         Name                  Offering        for Resale        the Offering
- --------------------------  ---------------   ------------    -----------------

William Zanker (1)........     302,312(2)      220,000         82,312/4.6%

Terrance Murray (3).......     279,375(4)      220,000         59,375/3.3%

Keith Dee (5).............     100,000(6)      100,000                 0

Edward Faber (7)..........      10,000(8)       10,000                 0

Andrew Hyams (7)..........      75,437(9)       10,000         65,437/3.7%

Donald Fleischer (7)......     26,125(10)       10,000         16,125/*

Peter Hanelt (7)..........      10,000(8)       10,000                 0

Stephen Seligman (7)......     15,000(11)       10,000          5,000/*




- -----------------------
*        less than 1%.

(1)      Mr.  Zanker is the Chairman of the Board,  President  and a director of
         the Company.

(2)      Includes (i) 63,562  shares of Common Stock held by The William  Zanker
         Trust for the benefit of his children (Mr. Zanker disclaims  beneficial
         ownership of such  shares),  (ii) 18,750 shares of Common Stock held by
         Debbie  Dworkin,  Mr. Zanker's wife (Mr.  Zanker  disclaims  beneficial
         ownership of such shares),  (iii) options to purchase 100,000 shares of
         Common Stock at an exercise  price of $1.875 per share and (iv) options
         to purchase  120,000  shares of Common  Stock at an  exercise  price of
         $3.75 per share.

(3)      Mr.  Murray  is the  Chief  Executive  Officer  and a  director  of the
         Company.

(4)      Includes (i) options to purchase  100,000  shares of Common Stock at an
         exercise price of $1.875 per share and (ii) options to purchase 120,000
         shares of Common Stock at an exercise price of $3.75 per share.

(5)      Mr. Dee is the Chief Financial Officer and Secretary of the Company.

(6)      Represents (i) options to purchase  10,000 shares of Common Stock at an
         exercise price of $2.5625 per share and (ii) options to purchase 90,000
         Shares of Common Stock at an exercise price of $2.375 per share.

                                      -11-

<PAGE>

(7)      Messrs. Faber, Hyams, Fleischer,  Hanelt, and Seligman are directors of
         the Company.

(8)      Represents  options to  purchase  10,000  shares of Common  Stock at an
         exercise price of $5.00 per share.

(9)      Includes  (i) 1,875  shares of Common  Stock held by Mr.  Hyams and his
         wife as joint  tenants  with the  right of  survivorship,  (ii)  63,562
         shares of Common Stock held as trustee for The William Zanker Trust and
         (iii) options to purchase  10,000 shares of Common Stock at an exercise
         price of $5.00 per share.

(10)     These shares  consist of (i) 3,625 shares held by Mr.  Fleischer,  (ii)
         10,000  shares  issuable  upon the  exercise  of options at an exercise
         price of $5.00  per share and (iii)  12,500  shares  issuable  upon the
         exercise of warrants purchased by Mr. Fleischer in the Company's bridge
         financing.

(11)     Includes (i) 5,000 shares of Common Stock held by Mr.  Seligman and his
         wife as joint tenants with the right of  survivorship  and (ii) options
         to purchase 10,000 shares of Common Stock at an exercise price of $5.00
         per share.


                              PLAN OF DISTRIBUTION

         It is anticipated that all of the Shares will be offered by the Selling
Shareholders  from time to time in the open market,  either  directly or through
brokers  or  agents,  or  in  privately  negotiated  transactions.  The  Selling
Shareholders  have  advised  the  Company  that  they  are  not  parties  to any
agreement, arrangement or understanding as to such sales.

                                  LEGAL MATTERS

         Certain  legal  matters in  connection  with the issuance of the Shares
offered hereby have been passed upon for the Company by Olshan  Grundman Frome &
Rosenzweig  LLP,  505  Park  Avenue,   New  York,  New  York  10022.  Such  firm
beneficially owns 7,500 shares of Common Stock of the Company. Stephen Irwin, of
counsel to Olshan  Grundman  Frome &  Rosenzweig  LLP,  beneficially  owns 2,800
shares of Common Stock of the Company.

                             ADDITIONAL INFORMATION

         The Company has filed with the  Securities  and  Exchange  Commission a
Registration  Statement on Form S-8 (together  with all  amendments and exhibits
thereto, the "Registration  Statement") under the Securities Act with respect to
the  Shares  offered  hereby.  This  Prospectus  does  not  contain  all  of the
information set forth in the Registration Statement,  certain parts of which are
omitted in accordance  with the rules and  regulations  of the  Commission.  For
further  information  with  respect to the  Company and the  securities  offered
hereby, reference is made to the Registration Statement. Statements contained in
this  Prospectus  as to the contents of any  contract or other  document are not
necessarily  complete,  and in each  instance,  reference is made to the copy of
such  contract or document  filed as an exhibit to the  Registration  Statement,
such statement being qualified in all respects by such reference.

                                      -12-

<PAGE>
                                     PART II

               INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

ITEM 3.  INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

         The  following   documents  filed  with  the  Securities  and  Exchange
Commission (the  "Commission")  are incorporated  herein by reference and made a
part hereof:

                  (a) The  Company's  Annual  Report on Form 10-KSB for the year
         ended December 31, 1995.

                  (b) The  Company's  Quarterly  Report on Form  10-QSB  for the
         quarter ended March 31, 1996.

                  (c) The description of the Company's  securities  contained in
         the Company's  Registration Statement on Form 8-A filed on February 23,
         1995.

          All  reports  and other  documents  subsequently  filed by the Company
pursuant to Sections 13, 14 and 15(d) of the Securities Exchange Act of 1934, as
amended, prior to the filing of a post-effective  amendment which indicates that
all securities offered hereby have been sold or which deregisters all securities
remaining unsold,  shall be deemed to be incorporated by reference herein and to
be a part hereof from the date of the filing of such reports and documents.

ITEM 4.  DESCRIPTION OF SECURITIES

         Not applicable.

ITEM 5.  INTEREST OF NAMED EXPERTS AND COUNSEL

          Certain legal  matters in  connection  with the issuance of the Shares
offered hereby have been passed upon for the Company by Olshan  Grundman Frome &
Rosenzweig  LLP,  505  Park  Avenue,   New  York,  New  York  10022.  Such  firm
beneficially owns 7,500 shares of Common Stock of the Company. Stephen Irwin, of
counsel to Olshan  Grundman  Frome &  Rosenzweig  LLP,  beneficially  owns 2,800
shares of Common Stock of the Company.

ITEM 6.  INDEMNIFICATION OF OFFICERS AND DIRECTORS

          Except  as  hereinafter  set  forth,  there  is  no  statute,  charter
provision,  by-law,  contract or other  arrangement  under which any controlling
person,  director  or officer of the  Company is insured or  indemnified  in any
manner against liability which he may incur in his capacity as such.

          The  Company's  authority to indemnify  its  directors and officers is
governed  by the  provisions  of  Sections  721 to 726 of the New York  Business
Corporation Law (the "BCL"), as follows:

          Section 721 Nonexclusivity of Statutory Provisions for Indemnification
of Directors and Officers -- The  indemnification  and  advancement  of expenses
granted  pursuant to, or provided by, this article shall not be deemed exclusive
of any other rights to which a director or officer  seeking  indemnification  or
advancement of expenses may be entitled, whether contained in the certificate of
incorporation  or the  by-laws  or,  when  authorized  by  such  certificate  of
incorporation or by-laws, (i) a resolution of shareholders, (ii) a resolution of
directors,  or (iii) an agreement providing for such  indemnification,  provided
that no  indemnification  may be made to or on behalf of any director or officer
if a judgment or other  final  adjudication  adverse to the  director or officer
establishes  that his acts were  committed  in bad  faith or were the  result of
active and  deliberate  dishonesty  and were  material to the cause of action so
adjudicated, or that he personally gained in fact a financial profit or other

                                      II-1

<PAGE>

advantage  to which  he was not  legally  entitled.  Nothing  contained  in this
article shall affect any rights to indemnification to which corporate  personnel
other than directors and officers may be entitled by contract or otherwise under
law.

         Section 722 Authorization for Indemnification of Directors and Officers
- -- (a) A corporation may indemnify any person, made, or threatened to be made, a
party to an  action  or  proceeding  other  than  one by or in the  right of the
corporation  to procure a  judgment  in its favor,  whether  civil or  criminal,
including an action by or in the right of any other  corporation  of any type or
kind, domestic or foreign, or any partnership,  joint venture,  trust,  employee
benefit  plan  or  other  enterprise,  which  any  director  or  officer  of the
corporation served in any capacity at the request of the corporation,  by reason
of the fact that he, his testator or intestate, was a director or officer of the
corporation,  or served  such other  corporation,  partnership,  joint  venture,
trust,  employee  benefit  plan or other  enterprise  in any  capacity,  against
judgments, fines, amounts paid in settlement and reasonable expenses,  including
attorneys' fees actually and necessarily  incurred as a result of such action or
proceeding,  or any appeal  therein,  if such director or officer acted, in good
faith,  for a purpose which he reasonably  believed to be in, or, in the case of
service for any other  corporation or any  partnership,  joint  venture,  trust,
employee benefit plan or other enterprise, not opposed to, the best interests of
the corporation  and, in criminal  actions or proceedings,  in addition,  had no
reasonable cause to believe that his conduct was unlawful.

                  (b) The  termination  of any such civil or criminal  action or
proceeding  by  judgment,  settlement,   conviction  or  upon  a  plea  of  nolo
contendere, or its equivalent, shall not in itself create a presumption that any
such  director or officer did not act,  in good  faith,  for a purpose  which he
reasonably  believed  to be in,  or,  in the  case  of  service  for  any  other
corporation or any partnership,  joint venture,  trust, employee benefit plan or
other enterprise,  not opposed to, the best interests of the corporation or that
he had reasonable cause to believe that his conduct was unlawful.

                  (c) A corporation may indemnify any person made, or threatened
to be made,  a party to an  action  by or in the  right  of the  corporation  to
procure a judgment  in its favor by reason of the fact that he, his  testator or
intestate,  is or was a director  or officer  of the  corporation,  or is or was
serving at the request of the  corporation as a director or officer of any other
corporation of any type or kind, domestic or foreign, of any partnership,  joint
venture, trust, employee benefit plan or other enterprise,  against amounts paid
in settlement and reasonable  expenses,  including attorneys' fees, actually and
necessarily incurred by him in connection with the defense or settlement of such
action,  or in  connection  with an appeal  therein if such  director or officer
acted, in good faith,  for a purpose which he reasonably  believed to be in, or,
in the case of  service  for any other  corporation  or any  partnership,  joint
venture,  trust, employee benefit plan or other enterprise,  not opposed to, the
best interests of the  corporation,  except that no  indemnification  under this
paragraph  shall be made in respect  of (1) a  threatened  action,  or a pending
action  which is settled or  otherwise  disposed  of, or (2) any claim  issue or
matter as to which  such  person  shall have been  adjudged  to be liable to the
corporation,  unless and only to the  extent  that the court in which the action
was brought, or, if no action was brought, any court of competent  jurisdiction,
determines upon application  that, in view of all the circumstances of the case,
the person is fairly and  reasonably  entitled to indemnity  for such portion of
the settlement amount and expenses as the court deems proper.

                  (d) For the purpose of this section,  a  corporation  shall be
deemed to have  requested a person to serve an employee  benefit  plan where the
performance by such person of his duties to the corporation  also imposes duties
on, or otherwise  involves  services by, such person to the plan or participants
or beneficiaries of the plan; excise taxes assessed on a person with respect to

                                      II-2

<PAGE>

an employee  benefit plan pursuant to applicable law shall be considered  fines;
and action taken or omitted by a person with respect to an employee benefit plan
in the performance of such person's duties for a purpose reasonably  believed by
such person to be in the interest of the participants  and  beneficiaries of the
plan  shall be  deemed  to be for a  purpose  which is not  opposed  to the best
interests of the corporation.

         Section 723 Payment of Indemnification Other Than By Court Award -- (a)
A person who has been successful,  on the merits or otherwise, in the defense of
a civil or criminal  action or proceeding of the character  described in section
722 shall be entitled to indemnification as authorized in such section.

                  (b) Except as provided in paragraph  (a), any  indemnification
under  section 722 or otherwise  permitted by section 721,  unless  ordered by a
court under section 724  (Indemnification of directors and officers by a court),
shall be made by the corporation, only if authorized in the specific case:

                           (1)   By the board acting by a quorum  consisting  of
directors who are not parties to such action or  proceeding  upon a finding that
the director or officer has met the standard of conduct set forth in section 722
or established pursuant to section 721, as the case may be, or,

                           (2)   If a  quorum  under  subparagraph  (1)  is  not
obtainable  or,  even if  obtainable,  a quorum of  disinterested  directors  so
directs;

                           (A)   By the board  upon the  opinion  in  writing of
independent  legal counsel that  indemnification  is proper in the circumstances
because the  applicable  standard of conduct set forth in such sections has been
met by such director or officer, or

                           (B)   By the  shareholders  upon a  finding  that the
director or officer has met the applicable standard of conduct set forth in such
sections.

                  (c) Expenses  incurred in defending a civil or criminal action
or proceeding may be paid by the corporation in advance of the final disposition
of such action or proceeding  upon receipt of an  undertaking by or on behalf of
such director or officer to repay such amount as, and to the extent, required by
paragraph (a) of section 725.

         Section 724 Indemnification of Directors and Officers by a Court -- (a)
Notwithstanding  the failure of a corporation  to provide  indemnification,  and
despite  any  contrary  resolution  of the board or of the  shareholders  in the
specific case under section 723 (Payment of indemnification  other than by court
award),  indemnification  shall be awarded  by a court to the extent  authorized
under section 722 (Authorization for indemnification of directors and officers),
and  paragraph  (a) of section 723.  Application  therefor may be made, in every
case, either:

                           (1)   In the civil action or  proceeding in which the
expenses were incurred or other amounts were paid, or

                           (2)   To the supreme court in a separate  proceeding,
in which case the  application  shall set forth the  disposition of any previous
application made to any court for the same or similar relief and also reasonable
cause  for the  failure  to make  application  for  such  relief  in  action  or
proceeding in which the expenses were incurred or other amounts were paid.

                           (b)   The  application  shall be made in such  manner
and form as may be required by the applicable  rules of court or, in the absence
thereof,  by direction of a court to which it is made. Such application shall be
upon notice to the  corporation.  The court may also direct that notice be given
at the

                                      II-3

<PAGE>

expense of the corporation to the  shareholders and such other persons as it may
designate in such manner as it may require.

                           (c)   Where  indemnification  is sought  by  judicial
action,  the  court  may  allow a person  such  reasonable  expenses,  including
attorneys'  fees,  during the  pendency of the  litigation  as are  necessary in
connection with his defense therein,  if the court shall find that the defendant
has by his  pleadings  or during the  course of the  litigation  raised  genuine
issues of fact or law.

         Section 725 Other Provisions Affecting Indemnification of Directors and
Officers -- (a) All expenses incurred in defending a civil or criminal action or
proceeding which are advanced by the corporation  under paragraph (c) of section
723 (Payment of indemnification other than by court award) or allowed by a court
under paragraph (c) of section 724 (Indemnification of directors and officers by
a court)  shall be repaid  in case the  person  receiving  such  advancement  or
allowance is  ultimately  found,  under the procedure set forth in this article,
not to be entitled to indemnification  or, where  indemnification is granted, to
the extent the expenses so advanced by the  corporation  or allowed by the court
exceed the indemnification to which he is entitled:

                  (b)   No  indemnification,  advancement or allowance  shall be
made under this article in any circumstance where it appears:

                        (1)  That the indemnification would be inconsistent with
the law of the  jurisdiction of  incorporation  of a foreign  corporation  which
prohibits or otherwise limits such indemnification;

                        (2)  That the indemnification would be inconsistent with
a provision of the certificate of  incorporation,  a by-law, a resolution of the
board or of the shareholders,  an agreement or other proper corporate action, in
effect at the time of the accrual of the alleged cause of action asserted in the
threatened  or pending  action or proceeding in which the expenses were incurred
or other amounts were paid, which prohibits or otherwise limits indemnification;
or

                        (3)  If there  has  been a  settlement  approved  by the
court,  that the  indemnification  would be inconsistent with any condition with
respect  to  indemnification  expressly  imposed by the court in  approving  the
settlement.

                  (c)   If any  expenses  or  other  amounts  are paid by way of
indemnification,  otherwise  than by court order or action by the  shareholders,
the  corporation  shall,  not later than the next annual meeting of shareholders
unless such meeting is held within  three months from the date of such  payment,
and in any event,  within fifteen months from the date of such payment,  mail to
its  shareholders  of record at the time  entitled  to vote for the  election of
directors a statement  specifying  the persons paid,  the amounts paid,  and the
nature and status at the time of such payment of the  litigation  or  threatened
litigation.

                  (d)   If  any  action  with  respect  to   indemnification  of
directors  and officers is taken by way of amendment of the by-laws,  resolution
of directors,  or by agreement,  then the corporation  shall, not later than the
next annual  meeting of  shareholders,  unless such meeting is held within three
months from the date of such action,  and, in any event,  within  fifteen months
from the date of such  action,  mail to its  shareholders  of record at the time
entitled to vote for the election of directors a statement specifying the action
taken.

                  (e)   Any  notification  required  to be made  pursuant to the
foregoing  paragraph (c) or (d) of this section by any domestic  mutual  insurer
shall be satisfied by compliance  with the  corresponding  provisions of section
one thousand two hundred sixteen of the insurance law.


                                      II-4

<PAGE>



                  (f)   The    provisions   of   this   article    relating   to
indemnification  of directors and officers and insurance therefor shall apply to
domestic  corporations  and foreign  corporations  doing business in this state,
except as provided in section 1320 (Exemption from certain provisions).

         Section 726 Insurance for  Indemnification of Directors and Officers --
(a) Subject to  paragraph  (b), a  corporation  shall have power to purchase and
maintain insurance:

                        (1)    To indemnify the  corporation  for any obligation
which it incurs as a result of the  indemnification  of  directors  and officers
under the provisions of this article, and

                        (2)    To indemnify  directors and officers in instances
in which they may be indemnified by the corporation under the provisions of this
article, and

                        (3)    To indemnify  directors and officers in instances
in which they may not  otherwise be  indemnified  by the  corporation  under the
provisions  of this article  provided the  contract of insurance  covering  such
directors and officers provides, in a manner acceptable to the superintendent of
insurance, for a retention amount and for co-insurance.

                  (b)   No  insurance  under  paragraph  (a) may provide for any
payment, other than cost of defense, to or on behalf of any director or officer.

                        (1)     if  a  judgment  or  other  final   adjudication
adverse to the insured  director or officer  establishes that his acts of active
and deliberate  dishonesty  were material to the cause of action so adjudicated,
or that he personally  gained in fact a financial  profit or other  advantage to
which he was not legally entitled, or

                        (2)     in relation to any risk the  insurance  of which
is prohibited under the insurance law of this state.

                  (c)   Insurance  under any or all  subparagraphs  of paragraph
(a) may be included in a single  contract or supplement  thereto.  Retrospective
rated contracts are prohibited.

                  (d)   The  corporation  shall,  within  the  time  and  to the
persons  provided in paragraph  (c) of section 725 (Other  provisions  affecting
indemnification  of directors or  officers),  mail a statement in respect of any
insurance  it has  purchased  or renewed  under  this  section,  specifying  the
insurance  carrier,  date  of the  contract,  cost of the  insurance,  corporate
positions insured,  and a statement explaining all sums, not previously reported
in a  statement  to  shareholders,  paid  under  any  indemnification  insurance
contract.

                  (e)   This  section  is the  public  policy  of this  state to
spread the risk of corporate  management,  notwithstanding  any other general or
special  law of this state or of any other  jurisdiction  including  the federal
government.

                       ----------- ------------ ----------

         The Company's  certificate of incorporation  provides that the personal
liability of the directors of the Company is  eliminated  to the fullest  extent
permitted by Section 402(b) of the BCL.

ITEM 7.  EXEMPTION FROM REGISTRATION CLAIMED

         Not applicable.


                                      II-5

<PAGE>

ITEM 8.  EXHIBITS

          4(a)   -         The Great American BackRub Store,  Inc. 1994 Employee
                           Stock Option Plan (the "1994 Plan")  (incorporated by
                           reference   to   Exhibit   4.4   to   the   Company's
                           Registration   Statement   on  Form  SB-2  (File  no.
                           33-88052)).

          4(b)   -         Stock Option Agreement dated as of December 23, 1994,
                           by and between the Company and William Zanker.

          4(c)   -         Stock Option  Agreement dated as of July 19, 1995, by
                           and between the Company and William Zanker.

          4(d)   -         Stock Option Agreement dated as of December 23, 1994,
                           by and between the Company and Terrance Murray.

          4(e)   -         Stock Option  Agreement dated as of July 19, 1995, by
                           and between the Company and Terrance Murray.

          4(f)   -         Stock Option  Agreement dated as of July 27, 1995, by
                           and between the Company and Simon Abrahams.

          4(g)   -         Stock Option  Agreement dated as of July 27, 1995, by
                           and between the Company and Keith Dee.

          4(h)   -         Stock Option  Agreement dated as of December 15, 1995
                           by and between the Company and Keith Dee.

          4(i)   -         Form of Stock  Option  Agreement  by and  between the
                           Company  and  Edward  Faber,   Andrew  Hyams,  Donald
                           Fleischer, Peter Hanelt and Stephen Seligman.

           5     -         Opinion of Olshan, Grundman, Frome & Rosenzweig LLP.

         23(a)   -         Consent of BDO Seidman, LLP, independent auditors.

         23(b)   -         Consent of Olshan,  Grundman,  Frome & Rosenzweig LLP
                           (included in its opinion filed as Exhibit 5).

         24      -         Powers of Attorney (included on the signature page to
                           this Registration Statement).


ITEM 9.  UNDERTAKINGS.

         A.       The undersigned registrant hereby undertakes:

                  (1)      To file,  during any period in which  offers or sales
                           are being made,  a  post-effective  amendment to this
                           Registration  Statement to include any  additional or
                           changed   material   information   on  the   plan  of
                           distribution.

                  (2)      That, for the purposes of  determining  any liability
                           under the  Securities  Act of 1933, as amended,  each
                           such post-effective amendment shall be deemed to be a
                           new registration statement relating to the securities
                           offered therein,  and the offering of such securities
                           at that time shall be deemed to be the  initial  bona
                           fide offering thereof; and

                  (3)      To   remove   from   registration   by   means  of  a
                           post-effective  amendment any of the securities being
                           registered  that remain unsold at the  termination of
                           the offering.

                                      II-6

<PAGE>




         B.       The  undersigned   registrant   hereby  undertakes  that,  for
                  purposes of determining any liability under the Securities Act
                  of  1933,  each  filing  of  the  registrant's  annual  report
                  pursuant to Section 13(a) or 15(d) of the Securities  Exchange
                  Act of 1934 (and, where applicable, each filing of an employee
                  benefit plan's annual report  pursuant to Section 15(d) of the
                  Securities  Exchange  Act of  1934)  that is  incorporated  by
                  reference in this Registration Statement shall be deemed to be
                  a  new  registration  statement  relating  to  the  securities
                  offered  therein,  and the offering of such securities at that
                  time  shall be deemed  to be the  initial  bona fide  offering
                  thereof.

         C.       Insofar as indemnification  for liabilities  arising under the
                  Securities  Act of  1933,  as  amended,  may be  permitted  to
                  directors,  officers and controlling persons of the registrant
                  pursuant  to  the  foregoing  provisions,  or  otherwise,  the
                  registrant  has  been  advised  that  in  the  opinion  of the
                  Securities and Exchange  Commission  such  indemnification  is
                  against  public policy as expressed in the  Securities  Act of
                  1933, as amended,  and is,  therefore,  unenforceable.  In the
                  event   that  a  claim  for   indemnification   against   such
                  liabilities  (other  than the  payment  by the  registrant  of
                  expenses   incurred  or  paid  by  a   director,   officer  or
                  controlling person of the registrant in the successful defense
                  of any  action,  suit  or  proceeding)  is  asserted  by  such
                  director, officer or controlling person in connection with the
                  securities being  registered,  the registrant will,  unless in
                  the opinion of its  counsel  the matter has been  settled by a
                  controlling  precedent,  submit  to  a  court  of  appropriate
                  jurisdiction the question whether such  indemnification  by it
                  is against public policy as expressed in the Securities Act of
                  1933,   as  amended,   and  will  be  governed  by  the  final
                  adjudication of such issue.


                                      II-7

<PAGE>
                                   SIGNATURES

         Pursuant  to the  requirements  of the  Securities  Act  of  1933,  the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this registration
statement  to be  signed  on its  behalf  by  the  undersigned,  thereunto  duly
authorized  in the City of New York,  State of New York,  on this 6th day of May
1996.

                                         THE GREAT AMERICAN BACKRUB STORE, INC.
                                         --------------------------------------
                                                     (Registrant)

                                         By:  /s/ William Zanker
                                              --------------------------------
                                         William Zanker, Chairman of the Board

                                POWER OF ATTORNEY

         KNOW  ALL MEN BY THESE  PRESENTS,  that  each  person  whose  signature
appears below  constitutes and appoints  William Zanker,  Terrance C. Murray and
Keith Dee his true and lawful  attorneys-in-fact  and agent,  with full power of
substitution and resubstitution, for and in his or her name, place and stead, in
any and all  capacities,  to sign  any or all  amendments  to this  Registration
Statement,  and to file the same, with all exhibits thereto, and other documents
in connection therewith,  with the Securities and Exchange Commission,  granting
unto said attorney-in-fact and agent, full power and authority to do and perform
each and  every act and thing  requisite  necessary  to be done in and about the
premises, as fully to all intents and purposes as he or she might or could do in
person,  hereby  ratifying and  confirming  all that said  attorney-in-fact  and
agent, or his or her  substitute,  may lawfully do or cause to be done by virtue
hereof.

         Pursuant  to the  requirements  of the  Securities  Act of  1933,  this
registration  statement  has  been  signed  by  the  following  persons  in  the
capacities and on the date indicated.

         Signature                  Title                       Date


/s/ William Zanker             Chairman of the Board,        May 6, 1996
- ---------------------------    President and Director
        William Zanker                    


/s/ Terrance C. Murray         Chief Executive Officer       May 6, 1996
- ---------------------------    (principal executive
      Terrance C. Murray       officer) and Director
                                          


/s/ Keith Dee                  Chief Financial Officer       May 6, 1996
- ---------------------------    (principal financial 
           Keith Dee           officer and principal
                               accounting officer) and
                               Secretary


/s/ Stephen Seligman           Director                      May 6, 1996
- ---------------------------
       Stephen Seligman


/s/ Edward E. Faber            Director                      May 6, 1996
- ---------------------------
       Edward E. Faber


/s/ Peter Hanelt               Director                      May 6, 1996
- ---------------------------
         Peter Hanelt


/s/ Donald R. Fleischer        Director                      May 6, 1996
- ----------------------------
      Donald R. Fleischer


/s/ Andrew L. Hyams            Director                     May 6, 1996
- ----------------------------
       Andrew L. Hyams

                                      II-8
<PAGE>


                                  EXHIBIT INDEX



   Exhibit
     No.                                  Description

          4(a)   -         The Great American BackRub Store,  Inc. 1994 Employee
                           Stock Option Plan (the "1994 Plan")  (incorporated by
                           reference   to   Exhibit   4.4   to   the   Company's
                           Registration   Statement   on  Form  SB-2  (File  no.
                           33-88052)).

          4(b)   -         Stock Option Agreement dated as of December 23, 1994,
                           by and between the Company and William Zanker.

          4(c)   -         Stock Option  Agreement dated as of July 19, 1995, by
                           and between the Company and William Zanker.

          4(d)   -         Stock Option Agreement dated as of December 23, 1994,
                           by and between the Company and Terrance Murray.

          4(e)   -         Stock Option  Agreement dated as of July 19, 1995, by
                           and between the Company and Terrance Murray.

          4(f)   -         Stock Option  Agreement dated as of July 27, 1995, by
                           and between the Company and Simon Abrahams.

          4(g)   -         Stock Option  Agreement dated as of July 27, 1995, by
                           and between the Company and Keith Dee.

          4(h)   -         Stock Option Agreement dated as of December 15, 1995,
                           by and between the Company and Keith Dee.

          4(i)   -         Form of Stock  Option  Agreement  by and  between the
                           Company  and  Edward  Faber,   Andrew  Hyams,  Donald
                           Fleischer, Peter Hanelt, and Stephen Seligman.

             5   -         Opinion of Olshan, Grundman, Frome & Rosenzweig LLP.


         23(a)   -         Consent of BDO Seidman, LLP, independent auditors.

         23(b)   -         Consent of Olshan,  Grundman,  Frome & Rosenzweig LLP
                           (included in its opinion filed as Exhibit 5).

            24   -         Powers of Attorney (included on the signature page to
                           this Registration Statement).
[{"type": "S-8", "sequence": "1", "description": "FORM S-8", "secsgml_size_bytes": 82719}]
{"company-data": {"conformed-name": "GREAT AMERICAN BACKRUB STORE INC", "cik": "0000934006", "assigned-sic": "7200", "irs-number": "133729043", "state-of-incorporation": "NY", "fiscal-year-end": "0930"}, "filing-values": {"form-type": "S-8", "act": "33", "file-number": "333-03221", "film-number": "96556954"}, "business-address": {"street1": "958 THIRD AVE", "city": "NEW YORK", "state": "NY", "zip": "10022", "phone": "2128321766"}, "mail-address": {"street1": "425 MADISON AVE", "street2": "ROOM 605", "city": "NEW YORK", "state": "NY", "zip": "10017"}}
As filed with the Securities and Exchange Commission on May 7, 1996
                                                           Registration No. 333-

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                              --------------------
                                    FORM S-8
                             REGISTRATION STATEMENT
                                      UNDER
                           THE SECURITIES ACT OF 1933
                              --------------------

                     THE GREAT AMERICAN BACKRUB STORE, INC.

          New York                                          13-3729043
(State or other jurisdiction of                          (I.R.S. Employer
incorporation or organization)                           Identification No.)

    425 Madison Avenue, Suite 605
    New York, New York                                          10017
(Address of principal executive offices)                      (Zip Code)

                              --------------------

                     The Great American BackRub Store, Inc.
             1994 Employee Stock Option Plan and Purchase Agreements
                            (Full Title of the Plan)

                              --------------------

                                 William Zanker
                                    President
                     The Great American Backrub Store, Inc.
                          425 Madison Avenue, Suite 605
                            New York, New York 10017
                     (Name and Address of agent for service)

                                  (212)750-7046
          (Telephone number, including area code, of agent for service)

                              --------------------

                                 With a copy to:
                               Stephen Irwin, Esq.
                     Olshan Grundman Frome & Rosenzweig LLP
                                 505 Park Avenue
                            New York, New York 10022
                                 (212) 753-7200

                              --------------------

             Approximate date of proposed sale pursuant to the Plan:
               From time to time after the effective date of this
                             registration statement.

                              --------------------
CALCULATION OF REGISTRATION FEE
========================================================================================================================
                                                         Proposed               Proposed
                                                          Maximum                Maximum
         Title of                Amount                  Offering               Aggregate              Amount of
        Securities               to be                     Price                Offering             Registration
     to be Registered          Registered                Per Share                Price                   Fee
- ------------------------------------------------------------------------------------------------------------------------
Common Stock,
$.001 par value              5,000(1)(2)                 $3.4375(1)          $17,187.50(1)                $5.93
- ------------------------------------------------------------------------------------------------------------------------
Common Stock,
$.001 par value             70,000(2)(3)                 $4.50(3)              $315,000(3)              $108.62
- ------------------------------------------------------------------------------------------------------------------------
Common Stock,
$.001 par value            615,000(2)(4)                 $3.03(4)            $1,863,450(4)              $642.57
- ------------------------------------------------------------------------------------------------------------------------
Total Registration Fee.........................................................................         $757.12
========================================================================================================================
(1)      Represents 5,000 shares with respect to which options were granted
         under the Registrant's 1994 Employee Stock Option Plan (the "Employee
         Plan") at an exercise price of $3.4375 per share.
(2)      Pursuant to Rule 416, an indeterminate number of shares of Common Stock
         that may become issuable pursuant to antidilution provisions of the
         Employee Plan and the various other written purchase agreements and
         written compensation contracts pursuant to which options were granted
         by the Registrant (collectively, the "Purchase Agreements") are also
         being registered.
(3)      Represents 70,000 shares of Common Stock with respect to which options
         have not yet been granted under the Employee Plan.  Pursuant to Rule
         457(g) and (h), the offering price for these shares of Common Stock
         which may be issued under the Employee Plan is estimated solely for the
         purpose of determining the registration fee and is based on $4.50, the
         per share average of high and low sale prices of the Common Stock as
         reported by the Nasdaq SmallCap Market on May 1, 1996.
(4)      Shares of Common Stock with respect to which options have been granted
         under the Purchase Agreements at an average exercise price of $3.03 per
         share to certain employees, directors and consultants of the Company.

================================================================================

                                       -2-
PROSPECTUS
                                 665,000 SHARES

                     THE GREAT AMERICAN BACKRUB STORE, INC.
                     Common Stock, $.001 par value per share

         This  Prospectus  relates to the reoffer and resale by certain  selling
shareholders  (the "Selling  Shareholders")  of 655,000 shares (the "Shares") of
Common  Stock,  $.001  par value per share  (the  "Common  Stock")  of The Great
American  BackRub Store,  Inc. (the "Company") that may be issued by the Company
to the Selling  Shareholders  upon the  exercise of  outstanding  stock  options
granted  under (a) the  Company's  1994  Employee  Stock  Option Plan (the "1994
Plan") and (b) various  written  purchase  agreements  and written  compensation
contracts  (collectively,  the  "Purchase  Agreements").  This  Prospectus  also
relates to the  reoffer  and resale of Shares to be  acquired  upon  exercise of
stock options that may be granted to individuals who may be deemed  "affiliates"
of the  Company  (collectively,  the  "Future  Selling  Shareholders")  upon the
exercise of outstanding  stock options to be granted under the 1994 Plan. If and
when such options are granted to the Future  Selling  Shareholders,  the Company
intends to distribute a Prospectus  Supplement as required by Rule 424(b) of the
Securities  Act of 1933,  as amended (the  "Securities  Act").  Such  Prospectus
Supplement  will specify the names of the Future  Selling  Shareholders  and the
amount of Shares to be reoffered and sold by them.

         The offer and sale of the Shares to the Selling Shareholders and to the
Future Selling Shareholders were previously registered under the Securities Act.
The Shares are being reoffered and may be resold for the accounts of the Selling
Shareholders  and the  Future  Selling  Shareholders  and the  Company  will not
receive any of the proceeds from the resale of the Shares.

         The Selling  Shareholders  have  advised the Company that the resale of
their Shares may be effected  from time to time in one or more  transactions  on
the Nasdaq SmallCap Market ("Nasdaq"),  in negotiated  transactions or otherwise
at  market  prices  prevailing  at the time of the sale or at  prices  otherwise
negotiated.  See "Plan of  Distribution."  The Company will bear all expenses in
connection with the preparation of this Prospectus.

         The Common Stock is traded on Nasdaq under the symbol "RUBB". On May 1,
1996, the closing price for the Common Stock, as reported by Nasdaq, was $4.50.

            AN INVESTMENT IN THE COMMON STOCK OFFERED HEREBY INVOLVES
           A HIGH DEGREE OF RISK. SEE "RISK FACTORS" AT PAGE 3 HEREOF.

             THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED
              BY THE SECURITIES AND EXCHANGE COMMISSION NOR HAS THE
               COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
               THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
                             IS A CRIMINAL OFFENSE.

                   The date of this Prospectus is May 7, 1996.
AVAILABLE INFORMATION

         The  Company  is  subject  to  the  informational  requirements  of the
Securities  Exchange  Act of 1934,  as  amended  (the  "Exchange  Act"),  and in
accordance therewith files reports,  proxy statements and other information with
the Securities and Exchange Commission (the "Commission").  Such reports,  proxy
statements  and other  information  can be  inspected  and  copied at the public
reference facilities  maintained by the Commission at Judiciary Plaza, 450 Fifth
Street, N.W.,  Washington,  D.C. 20549; or at certain of the regional offices of
the Commission located at 500 West Madison Street, Suite 1400, Chicago, Illinois
60661;  and Seven World Trade  Center,  Suite  1300,  New York,  New York 10048.
Copies of such material can be obtained from the Public Reference Section of the
Commission at Judiciary Plaza, 450 Fifth Street, N.W.,  Washington,  D.C. 20549,
at prescribed rates.

                                TABLE OF CONTENTS

                                                                        Page

     AVAILABLE INFORMATION................................................2

     INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE......................2

     RISK FACTORS.........................................................4

     GENERAL INFORMATION..................................................8

     RECENT DEVELOPMENTS..................................................9

     USE OF PROCEEDS.....................................................10

     SELLING SHAREHOLDERS................................................11

     PLAN OF DISTRIBUTION................................................12

     LEGAL MATTERS.......................................................12

     ADDITIONAL INFORMATION..............................................12

                 INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

         The  Company's  (i)  Annual  Report on Form  10-KSB  for the year ended
December 31, 1995 and (ii) Quarterly Report on Form 10-QSB for the quarter ended
March 31,  1996,  which  have been  filed with the  Commission  pursuant  to the
Exchange Act, are hereby  incorporated by reference in this Prospectus and shall
be deemed to be a part hereof.  All documents  filed by the Company  pursuant to
Sections  13(a),  13(c),  14 or 15(d) of the Exchange Act after the date of this
Prospectus  and  prior to the  termination  of this  offering  are  deemed to be
incorporated  by reference in this  Prospectus  and shall be deemed to be a part
hereof from the date of filing of such documents.

         The Company's  Application  for  Registration of its Common Stock under
Section 12(g) of the Exchange Act filed on February 23, 1995, is incorporated by
reference in this Prospectus and shall be deemed to be a part hereof.

         The Company hereby  undertakes to provide without charge to each person
to whom a copy of this  Prospectus  has been  delivered,  on the written or oral
request of any such person,  a copy of any or all of the  documents  referred to
above which have been or may be  incorporated  in this  Prospectus by reference,
other than

                                       -2-
exhibits to such documents.  Written requests for such copies should be directed
to The Great American  BackRub Store,  Inc., 425 Madison Avenue,  Suite 605, New
York, New York 10017, Attention:  President. Oral requests should be directed to
such officer (telephone number (212) 750-7046).

                              --------------------

         No dealer,  salesman or other  person has been  authorized  to give any
information or to make any  representations  other than those  contained in this
Prospectus in connection with the offer made hereby, and, if given or made, such
information or representations must not be relied upon as having been authorized
by the Company or any Selling  Shareholder.  This Prospectus does not constitute
an offer to sell, or a solicitation  of an offer to buy, the securities  offered
hereby to any person in any state or other  jurisdiction  in which such offer or
solicitation  is unlawful.  The delivery of this Prospectus at any time does not
imply that information  contained herein is correct as of any time subsequent to
its date.

                                       -3-
RISK FACTORS

         THE   SECURITIES   OFFERED  HEREBY  INVOLVE  A  HIGH  DEGREE  OF  RISK.
PROSPECTIVE  INVESTORS  SHOULD  CAREFULLY  CONSIDER THE  FOLLOWING  RISK FACTORS
BEFORE MAKING AN INVESTMENT DECISION.

REPORT OF INDEPENDENT  CERTIFIED  PUBLIC  ACCOUNTANTS  CONTAINING AN EXPLANATORY
PARAGRAPH THAT INDICATES GOING CONCERN UNCERTAINTIES.  The Company's independent
certified  public  accountants  have included an explanatory  paragraph in their
report  on  the  Company's  Financial  Statements  stating  that  the  Financial
Statements  have been  prepared  based on the  assumption  that the Company will
continue as a going concern and that the Company's  losses from operations since
inception raise  substantial  doubt about the ability of the Company to continue
as a going concern.

DEVELOPMENT STAGE COMPANY;  LIMITED  OPERATING HISTORY AND REVENUES;  HISTORICAL
AND  ANTICIPATED  LOSSES;  ACCUMULATED  DEFICIT.  The Company was  organized  in
December  1992,   commenced   operations  in  August  1993,   opened  its  first
Company-owned  store in  October  1993 and  therefore  has a  limited  operating
history  upon  which an  evaluation  of the  Company's  future  performance  and
prospects can be made.  The Company's  prospects  must be considered in light of
the risks, expenses, delays, problems and difficulties frequently encountered in
the establishment of a new business in an emerging and evolving industry.  Since
inception,   the  Company  has  generated  limited  revenues  and  has  incurred
significant  losses,  including  losses of $1,118,975,  $2,647,255 and $597,870,
respectively,  for the  years  ended  December  31,  1994 and 1995 and the three
months  ended March 31, 1996  resulting,  at March 31, 1996,  in an  accumulated
deficit  of  $4,774,065.   Losses  are  continuing  through  the  date  of  this
Prospectus.  Inasmuch as the Company continues to have a high level of operating
expenses  and will be  required to make  significant  up-front  expenditures  in
connection with its proposed expansion, the Company anticipates that losses will
continue  for at least the next 12 months and until such time,  if ever,  as the
Company is able to generate  sufficient  revenues to finance its  operations and
the costs of continuing  expansion.  Since inception,  the Company's  operations
have generated negative cash flow, as its expenses have exceeded  revenues,  and
the Company's  ability to continue its  operations  has been dependent upon debt
and equity  financings.  There can be no assurance that the Company will be able
to generate  significant  revenues or achieve profitable  operations or that its
operations will generate positive cash flow.

NEW INDUSTRY;  UNCERTAINTY OF MARKET ACCEPTANCE.  As is typically the case in an
emerging  industry,  demand and market acceptance for newly introduced  services
and products are subject to a high level of uncertainty. The Company has not yet
commenced  significant marketing activities or studies and currently has limited
marketing  experience  in the retail back rub  business  and limited  financial,
personnel and other  resources to undertake  extensive  marketing  activities or
studies.  The Company  does not intend to conduct any formal  marketing or other
concept feasibility studies to determine the potential  commercial  viability of
its concept. Achieving market acceptance for the Company's services and products
will require substantial  marketing efforts and expenditure of significant funds
to create awareness and demand.  The Company's  success depends in large part on
its ability to attract  suitable  franchisees  and will also be dependent on the
level of  acceptance  and  usage  of the  Company's  services  and  products  by
consumers.  Because  demand by  prospective  franchisees  and  consumers  may be
interrelated,  any  lack  or  lessening  of  demand  by any one of  these  could
adversely affect market acceptance for the Company's  services and products.  In
light of the relatively  undeveloped and emerging  markets for retail back rubs,
there can be no assurance that a substantial  market for the Company's  services
and products will develop and grow.

RISKS  ASSOCIATED  WITH GROWTH  STRATEGY  AND RAPID  EXPANSION.  The Company has
achieved only limited growth to date.  Implementation of the Company's  proposed
expansion will be substantially dependent on, among other things, the Company's

                                       -4-
ability  to  identify  and  secure  advantageous  locations  and  leases for its
Company-owned  and franchised  stores on a timely basis and on favorable  terms;
hire and retain skilled  management,  financial,  marketing and other personnel;
and successfully  manage growth (including  monitoring  operations,  controlling
costs and maintaining  effective quality,  inventory and service controls).  The
Company's  prospects  will also be  significantly  affected  by its  ability  to
successfully  develop  and  maintain  relationships  with its  franchisees.  The
Company's  growth  strategy  and  plans are  subject  to change as a result of a
number of  factors,  including  progress  or delays in the  Company's  marketing
efforts,  changes in market conditions and competitive factors.  There can be no
assurance that the Company will be able to  successfully  implement its business
strategy or otherwise expand its operations.

FRANCHISING.  The Company's  success will be dependent upon the  development and
implementation   of  an  effective   franchise   program,   which  would  afford
unaffiliated  parties the opportunity to own and operate Great American  BackRub
Stores using the  Company's  concept.  The Company  intends to include in such a
program  criteria to evaluate  franchisees.  However,  there can be no assurance
that the  Company  will be able to manage such a program  effectively,  that its
franchisees will have the ability or resources necessary to successfully develop
and operate their stores or that such franchisees'  stores will be well operated
and  promoted.  In  addition,  the  Company  intends  to lease the space for any
franchised stores directly from the landlord and sublease to the franchisee. The
Company will be primarily  liable for any such leases and may be required to pay
the landlord directly if the franchisee fails to do so.

DEPENDENCE  ON PROCEEDS OF INITIAL  PUBLIC  OFFERING  TO FINANCE  EXPANSION  AND
WORKING  CAPITAL;  POSSIBLE NEED FOR ADDITIONAL  FINANCING.  The Company remains
dependent on the proceeds of the its initial public offering  completed in March
1995 (the "IPO") and other future financings to implement its proposed expansion
and to finance its working capital requirements.  The Company anticipates, based
on  currently  proposed  plans  and  assumptions   relating  to  its  operations
(including  the costs  associated  with its  proposed  expansion),  that the net
proceeds  of the  IPO  will  be  sufficient  to  satisfy  its  anticipated  cash
requirements  at least  through July 1996.  The Company will be required to seek
additional  financing to implement  its  proposed  expansion  and to finance its
working capital requirements. To the extent that the Company incurs indebtedness
or issues debt securities,  the Company will be subject to risks associated with
incurring substantial indebtedness,  including the risks that interest rates may
fluctuate and cash flow may be insufficient to pay principal and interest on any
such indebtedness.  The Company has no current  arrangements with respect to, or
sources  of,  additional  financing,  and it is not  anticipated  that  existing
shareholders  will  provide  any  portion  of  the  Company's  future  financing
requirements.  There  can be no  assurance  that  additional  financing  will be
available  to the  Company on  commercially  reasonable  terms or at all. If the
Company  is unable to  obtain  additional  financing,  its  ability  to meet its
current  obligations  and  current  plans  for  expansion  could  be  materially
adversely affected.

POTENTIAL LIABILITY; INSURANCE. The Company is engaged in a business which could
expose it to possible  liability claims from others,  including  personal injury
claims.  The Company  maintains  a general  liability  insurance  policy that is
subject to a $1,000,000 per occurrence limit with a $1,000,000  aggregate limit.
Currently,  the  Company  requires  all of  its  employee/therapists  to  obtain
professional  liability  insurance (in the minimum amount of $1,000,000) through
one of two  professional  massage  organizations.  In some cases, the Company is
permitted under the applicable policy to be named as an additional  insured.  In
addition,  the  Company  has  obtained a  professional  liability  policy for an
additional $1,000,000 covering all of its employees.  There can be no assurance,
however,  that the Company's  insurance  will be  sufficient to cover  potential
claims or that an adequate  level of coverage will be available in the future at
a reasonable cost. A partially insured or completely  uninsured successful claim
against the Company could have a material adverse effect on the Company.

                                       -5-
REGULATION.  Certain states in which the Company intends to operate,  as well as
the  State of New  York,  in which  the  Company  currently  operates  its eight
Company-owned  stores,  require the licensing of massage therapists.  The offer,
sale,  termination  or renewal of  franchises in the United States is subject to
requirements  established  by the  Federal  Trade  Commission  (the  "FTC").  In
addition to the requirements of the FTC, certain states require that franchisors
register in the state prior to offering  franchises in such states.  The Company
believes that it is in compliance  with all applicable  laws and regulations and
has all required licenses to conduct its business.  However, no assurance can be
given that current laws or regulations applicable to the Company's business will
not change. Any such new laws or regulations or the Company's expansion into new
geographic  areas could  subject the  Company to  substantial  costs in order to
comply with such applicable  laws or regulations.  Any failure by the Company to
comply with any new or existing laws or regulations could subject the Company to
substantial penalties.

COMPETITION.  Management  of the  Company  believes  that  no  other  multi-unit
retailer is in the business in which the Company operates.  Competition consists
of  numerous  independent  massage  therapists,  spas,  salons and health  clubs
providing full body massage and a limited number of massage therapists providing
seated  massage  in  non-retail  "off-site"  environments.  However,  due to the
relatively  low cost of, and lack of other barriers to, entry into the Company's
business,  no  assurance  can be given that others  will not develop  multi-unit
retail concepts or stores similar to or competitive  with the Company's  concept
and  stores  or that  the  Company  will  successfully  compete  with  any  such
competitors,  some of whom may have  substantially  greater  financial and other
resources than the Company.

DEPENDENCE ON KEY  PERSONNEL;  ATTRACTION  AND RETENTION OF KEY  PERSONNEL.  The
Company  is  dependent  to a great  extent,  on the  experience,  abilities  and
continued  services  of Mr.  Zanker,  the  Company's  Chairman  of the Board and
President and Mr.  Murray,  the Company's  Chief  Executive  Officer.  While the
Company's management has substantial  national retail and franchise  experience,
no assurance can be given that such prior  experience  will assure the Company's
success.  In addition,  the Company's  management has no prior  experience  with
companies  offering  products  and  services  similar  to those  offered  by the
Company. The Company has entered into three-year employment agreements with each
of Messrs.  Zanker and Murray which expire on October 31, 1997.  The loss of the
services of Messrs.  Zanker and Murray could have a material  adverse  effect on
the Company.  The Company has obtained  $2,000,000  of key man  insurance on the
lives of each of Messrs.  Zanker and Murray.  The Company's success also depends
upon its ability to attract and retain  qualified  massage  therapists and other
additional  qualified  personnel.  While the Company believes there are numerous
qualified massage therapists currently available, competition for such personnel
may become intense.  There can be no assurances that the Company will be able to
attract and retain qualified personnel.

POSSIBLE IMMEDIATE AND SUBSTANTIAL  DILUTION. At March 31, 1996, the Company had
a net tangible book value of approximately $1.46 per share. If purchasers of the
Common Stock offered hereby  purchase such shares at a price higher than the net
tangible book value per share, they will experience  dilution in an amount equal
to the  difference  between  the price per share they paid and the net  tangible
book value per share.

NO DIVIDENDS. The Company has never paid a dividend on its Common Stock and does
not intend to pay any dividends to its  shareholders in the foreseeable  future.
The Company currently intends to reinvest  earnings,  if any, in the development
and expansion of its business.

NO ASSURANCE OF CONTINUED PUBLIC MARKET;  POSSIBLE  VOLATILITY OF MARKET.  There
can be no assurance  that a regular  trading market for the Common Stock will be
sustained. The market price of the Common Stock may be highly volatile as has

                                       -6-
been the case with the  securities of many emerging  companies.  Factors such as
the  Company's  operating  results  and  announcements  by  the  Company  or its
competitors  of new  products or services  may  significantly  impact the market
price of the  Company's  securities.  In addition,  in recent  years,  the stock
market has  experienced a high level of price and volume  volatility  and market
prices  for the  securities  of  many  companies  have  experienced  wide  price
fluctuations  not  necessarily  related  to the  operating  performance  of such
companies. Although Laidlaw may make and certain dealers presently make a market
in the Common  Stock,  they are not obligated to do so and may cease such market
making activities at any time.

EFFECT OF  OUTSTANDING  OPTIONS AND  WARRANTS,  COMPANY'S  STOCK OPTION PLAN AND
REPRESENTATIVE'S WARRANTS;  DILUTIVE EFFECTS. As of the date of this Prospectus,
options and  warrants to purchase an  aggregate  of  1,225,000  shares of Common
Stock are issued and outstanding,  held by the Company's executive  officers,  a
former executive officer, consultants and a former consultant to the Company. In
connection  with a bridge  financing  consummated  in November 1994, the Company
issued the warrants (the "Bridge  Warrants") to purchase an aggregate of 137,500
shares of Common Stock  exercisable at a price of $2.50 per share.  In addition,
options  to  purchase  5,000  shares of Common  Stock are  presently  issued and
outstanding  under the  Employee  Plan.  The Company may from time to time issue
options under the Employee Plan to purchase up to an additional 70,000 shares of
Common Stock.  The Company agreed with the  underwriters in the IPO not to grant
or issue  options to purchase  more than 37,500 shares of Common Stock under the
Employee  Plan prior to  February  28,  1997.  The  Company  granted  options to
purchase an  aggregate  of 50,000  shares of Common  Stock to  directors  of the
Company.  In  connection  with  the  IPO,  the  Company  issued  and sold to the
representatives  of the several  underwriters in the IPO (the  "Representative")
for  nominal  consideration  the  Representative's  Warrants  which  entitle the
Representative  to purchase an aggregate of 125,000 shares of Common Stock.  The
Representative's  Warrants are  exercisable  through  February  25, 2000,  at an
exercise price of $6.00 per share.  The Company  recently entered into an Option
Agreement  with the  Representative  which  provides  that in the event  certain
options  granted to the Company to  repurchase  shares of Common  Stock from the
Representative are exercised in full, the Representative's  Warrants will not be
exercisable prior to June 4, 1996. See "Recent Developments." The holders of the
options and warrants presently  outstanding,  holders of any subsequently issued
options and warrants of the Company, as well as the Representative will have the
opportunity  to  profit  from a rise in the  market  price of the  Common  Stock
without  assuming  the  risk of  ownership.  The sale of  Common  Stock or other
securities  held by or issuable to any such holders,  or merely the potential of
such  sales,  could  have an adverse  effect on the  market  price of the Common
Stock.  The  Company  may  find it more  difficult  to raise  additional  equity
capital,  if it should be needed for the business of the  Company,  while any of
such securities are  outstanding.  At any time when the holders thereof might be
expected to convert or exercise  them,  the  Company  would  probably be able to
obtain  additional equity capital on terms more favorable than those provided by
such  securities.  To the  extent  that any such  securities  are  converted  or
exercised,  as the case may be, the  percentage  of  ownership  interest  of the
Company's shareholders will be diluted.

SHARES  ELIGIBLE  FOR  FUTURE  SALE.  Of the  1,785,266  shares of Common  Stock
outstanding,  410,266 shares are "restricted  securities"  within the meaning of
the  Securities  Act  of  1933,  as  amended,  and  the  rules  and  regulations
promulgated  thereunder  (the  "Act")  and,  generally,  may  be  sold  only  in
compliance  with Rule 144 under the Act.  In  addition,  certain of the  410,266
shares are subject to lockup  restrictions  described  below.  Of the  remaining
1,375,000 shares, 125,000 shares, which represent shares of Common Stock sold by
the Company in a private  placement in June 1993,  are freely  tradeable and not
subject to lockup restrictions.  Of the 410,226 restricted  securities,  184,187
may be sold  pursuant  to Rule 144,  63,562 of which  shares are  subject to the
lockup  restrictions  described  below  and the  remaining  226,039  shares  are
available for sale under

                                       -7-
Rule 144 at various  times  during  1996 and 1997,  of which  91,250  shares are
subject to the lockup restrictions described below. Under Rule 144, a person who
has held  restricted  securities  for a period  of two  years may sell a limited
number of such  securities  into the public market without  registration of such
securities  under the Act. Rule 144 also permits,  under certain  circumstances,
persons  who  are  not  affiliates  of the  Company  to  sell  their  restricted
securities  without  quantity  limitations  once they have  satisfied Rule 144's
three-year  holding  period.  Sales made  pursuant to Rule 144 by the  Company's
existing shareholders may have a depressive effect on the price of the shares of
Common Stock in the public market.  Such sales could also  adversely  affect the
Company's  ability to raise  capital at that time through the sale of its equity
securities.  All of the Company's officers and directors (who own 173,562 shares
in the aggregate) have agreed not to sell,  assign or transfer  154,812 of their
shares of Common  Stock for a period of eighteen  (18) months from  February 28,
1995 without the  Representative's  prior written consent.  The Company's Option
Agreement  with the  Representative  provides  that in the event the Options are
exercised in full,  the lock-up  agreements  entered into by Messrs.  Zanker and
Murray  and such 5% or  greater  shareholder  shall  become  null and void.  The
holders of the  Representative's  Warrants have certain registration rights with
respect to the Common Stock underlying such Warrants.

LISTING AND  MAINTENANCE  CRITERIA  FOR NASDAQ  QUOTATION.  The Common  Stock is
quoted on Nasdaq.  To continue to be quoted on Nasdaq,  the Company must satisfy
certain  maintenance  criteria,  including having (i) at least two market makers
for the Common  Stock,  (ii) total assets of at least $2 million,  (iii) capital
and  surplus of at least $1  million,  (iv) a minimum bid price per share of $1,
(v) at least 300 shareholders and (vi) a public float of at least 100,000 shares
with a market value of at least $200,000.  The failure to meet these maintenance
criteria  in the future may result in the Common  Stock not being  eligible  for
quotation on Nasdaq and trading, if any, of the Common Stock would thereafter be
conducted  on the OTC  Bulletin  Board.  As a result of such  ineligibility  for
quotation,  an investor  may find it more  difficult to dispose of, or to obtain
accurate quotations as to the market value of, the Common Stock.

                               GENERAL INFORMATION

         The Company is a development stage company engaged in the creation of a
national  chain of stores  under the name "The Great  American  BackRub  Store,"
which offer  reasonably-priced  back rubs to customers while they are seated and
fully  clothed  in a clean,  open,  non-threatening  environment.  The back rubs
currently offered by the Company are for 5, 10, 20, 30 or 45 minutes,  priced at
approximately $8.95, $14.95, $24.95, $34.95 and $49.95, respectively. By design,
The Great American BackRub Store is a specialty  interactive retailer offering a
wide range of massage and stress reduction products, including oils, bath salts,
back supports and electronic and mechanical  stress  reduction  devices  (priced
generally from $4.95 to $250.00). The Company believes that the combination of a
boutique retail concept with back rub services makes The Great American  BackRub
Store a unique shopping experience.

         The Company currently owns and operates seven retail stores in New York
City and one location in the  Westchester  Mall in White Plains,  New York.  The
Company plans to open  approximately  40  Company-owned  stores within two years
from the date of this  Prospectus and  additional  franchised  stores,  although
there can be no assurance  that the Company will be successful in this plan. The
Company  intends to place its stores in high  traffic  locations  such as malls,
airports, urban sites and casinos.

         The  typical  Great  American   BackRub  Store  location   consists  of
approximately  600 to 1,200  square  feet,  including  300 to 600 square feet of
retail space. Customers are seated on a specially-designed  chair which provides
cushioned  support  for the  chest,  arms and head.  The  Company's  stores  are
designed to permit people both inside and outside the store to view the back rub
process and

                                       -8-
at the same time  maintain the privacy of the back rub  customer.  The Company's
stores  will also  offer  back rub  services  off-site,  to  corporate  offices,
convention centers and tourist  attractions.  All back rub services are provided
by  therapists  who are either  licensed  (in states  where  such  licensing  is
required) or have completed training at a school certified by a recognized trade
association.

         The  Company's  growth  strategy  is to  be  implemented  primarily  by
Terrance Murray, the Company's Chief Executive Officer, who previously served as
the executive vice president - operations of Supercuts,  Inc. Supercuts, Inc. is
a hair care chain with in excess of 1,000 company-owned and franchised stores in
43 states and Puerto Rico. The Company  believes that the  substantial  national
retail and franchise experience of Mr. Murray will be an asset to the Company.

         The Company was incorporated under the laws of the State of New York in
December  1992.  The  Company's  executive  offices  are  located at 425 Madison
Avenue,  Suite 605, New York,  New York 10017 and its telephone  number is (212)
750-7046.

                               RECENT DEVELOPMENTS

OPTION AGREEMENT

         On December 7, 1995, the Company entered into an option  agreement (the
"Option Agreement") with Laidlaw and the Selling  Shareholder  pursuant to which
Laidlaw granted the Company an option (the "First  Option") to purchase  100,000
shares of Common  Stock (the "First  Option  Shares") and an option (the "Second
Option" and together with the First Option,  the "Options") to purchase  375,000
shares of Common Stock (the "Second  Option  Shares" and together with the First
Option Shares, the "Option Shares").  The First Option may be exercised in whole
or in part,  at any time or from  time to time,  from the date  (the  "Effective
Date") the post-effective  amendment to the registration statement of which this
Prospectus  is a part is declared  effective by the  Commission to and including
June 7, 1996 (the  "Expiration  Date"),  after  which the First  Option,  to the
extent not previously  exercised,  will expire. The exercise price for the First
Option from the Effective Date to and including the fifth business day following
the Effective Date (the "Step-up  Date") shall be $3.50 per share.  The exercise
price for the First Option from the day  immediately  following the Step-up Date
until the Expiration Date shall be $4.00 per share.

         The Second  Option may be exercised in whole or in part, at any time or
from time to time,  from the Effective  Date until the  Expiration  Date,  after
which the Second Option,  to the extent not previously  exercised,  will expire.
The exercise price for the Second Option shall be $4.00 per share.

         The Option  Agreement  may be assigned by the  Company,  at any time or
from time to time in whole or in part,  without the consent of Laidlaw as to any
of the Options which are  simultaneously  therewith  being exercised by any such
assignee.  On April 24, 1996,  the Company  entered into an agreement with three
individuals (the "Holders") whereby the Company granted to the Holders the right
to cause the Company to assign the Second  Option to the Holders.  The agreement
expires on June 7, 1996 (the  "Termination  Date"). To the extent the Expiration
Date is extended,  the Termination  Date shall be extended to coincide with such
Expiration Date. The exercise price of the Second Option to the Holders is $5.00
per share.

FRANCHISE/FRANCHISE OPTION TERMINATIONS

         The Company's first  franchised store (the "Las Vegas Store") opened in
July 1994 in Las Vegas,  Nevada. The Company entered into a franchise  agreement
(the "Franchise  Agreement") with its Las Vegas franchisee (the "Franchisee") on
June 1, 1994.  Pursuant to the  Franchise  Agreement,  the  Franchisee  paid the
Company an initial,  non-recurring,  non-refundable franchise fee of $10,000. In
addition,

                                       -9-
the  Franchisee  paid the  Company  a  monthly  royalty  fee  equal to 8% of the
Franchisee's  gross  monthly  revenues (as such term is defined in the Franchise
Agreement).  The Franchisee  also paid to the Company an  advertising  and sales
promotion  fee which is equal to the  greater  of 3% of the  Franchisee's  gross
monthly  revenues or $1,000.  On May 30,  1995,  the Company and the  Franchisee
entered  into a  franchise  termination  agreement  whereby  (i)  the  Franchise
Agreement  and related  sublease  were  terminated,  (ii) the Company  purchased
certain  assets from the  Franchisee  and (iii) the  Company and the  Franchisee
provided for the mutual release of any  obligations of each to the other whether
arising out of the Franchise Agreement,  the sublease or otherwise. The purchase
price for the assets  conveyed by the  Franchisee to the Company was $25,000 and
18,185 shares of Common  Stock.  Simultaneously  with the Franchise  Termination
Agreement, the Company closed the Las Vegas Store.

         The  Company   entered   into  two  option   agreements   (the  "Option
Agreements")  with  Bay Area  Backs I, a  California  limited  partnership  (the
"Optionee"),  on June 20, 1994 and June 21, 1994, respectively,  for the opening
of two  franchised  stores in the San  Francisco  area.  Pursuant  to the Option
Agreements, the Optionee paid to the Company $5,000 for each of two options (the
"Options") to require the Company to enter into  franchise  agreements  with the
Optionee.  On May 30, 1995, the Company and the Optionee  entered into an option
termination  agreement whereby (i) the Option  Agreements were terminated,  (ii)
the Company purchased certain assets from the Optionee and (iii) the Company and
the Optionee  provided for the mutual release of any  obligations of each to the
other whether  arising out of the Option  Agreements or otherwise.  The purchase
price for the assets conveyed by the Optionee to the Company and the termination
of the Options was $27,300.

CONSULTING AGREEMENT

         On February 8, 1996, the Company entered into a Financial  Advisory and
Consulting   Agreement  (the  "Financial  Advisory  Agreement")  with  Investors
Associates,  Inc.  ("Investors  Associates").  The Financial  Advisory Agreement
expires on January 31, 1997. As compensation for the services to be performed by
Investors   Associates  to  the  Company  pursuant  to  the  Financial  Advisory
Agreement,  the Company paid to Investors  Associates a financial consulting fee
of $100,000,  warrants to purchase 100,000 shares of Common Stock of the Company
at an exercise price of $1.00 per share exercisable to and including January 31,
1997, and warrants to purchase  200,000 shares of Common Stock of the Company at
an exercise price of $2.50 per share  exercisable  to and including  January 31,
1998.  The  Company  has  granted  certain   registration  rights  to  Investors
Associates  relating to the registration of the shares issuable upon exercise of
the warrants under the Securities Act of 1933, as amended.

         During  the  term  of  the  Financial  Advisory  Agreement,   Investors
Associates  will provide the Company with such regular and customary  consulting
advice as is reasonably requested by the Company.  Investors  Associate's duties
will include,  but will not necessarily be limited to (i) providing  sponsorship
and exposure in  connection  with the  dissemination  of  corporate  information
regarding  the Company to the  investment  community  at large,  (ii)  arranging
meetings with securities  analysts,  (iii) assisting in the Company's  financial
public  relations and (iv) rendering advice regarding a future public or private
offering of  securities  of the Company or of any of its  subsidiaries.  In this
regard,  Investors  Associates  has agreed to use its best efforts to assist the
Company in arranging  for a private  placement or public  offering of securities
with gross proceeds to the Company of at least $2 million.

                                 USE OF PROCEEDS

         The  Company  will  receive  the  exercise  price of the  options  when
exercised by the holders thereof. Such proceeds will be used for working capital
purposes

                                      -10-
by the  Company.  The  Company  will not receive  any of the  proceeds  from the
reoffer and resale of the Shares by the Selling Shareholders.

                              SELLING SHAREHOLDERS

         This  Prospectus  relates to the reoffer and resale of Shares issued or
that may be issued to the Selling  Shareholders under the Purchase Agreements or
the 1994 Plan.

         The following table sets forth (i) the number of shares of Common Stock
beneficially  owned by each  Selling  Shareholder,  (ii) the number of Shares of
Common Stock to be offered for resale by each Selling  Shareholder and (iii) the
number  and  percentage  of shares of  Common  Stock to be held by each  Selling
Shareholder after completion of the offering.

                                                               Number of shares
                                                               of Common Stock/
                              Number of                         Percentage of
                              shares of         Number of        Class to be
                             Common Stock       Shares to        Owned After
                            Owned Prior to     be Offered       Completion of
         Name                  Offering        for Resale        the Offering
- --------------------------  ---------------   ------------    -----------------

William Zanker (1)........     302,312(2)      220,000         82,312/4.6%

Terrance Murray (3).......     279,375(4)      220,000         59,375/3.3%

Keith Dee (5).............     100,000(6)      100,000                 0

Edward Faber (7)..........      10,000(8)       10,000                 0

Andrew Hyams (7)..........      75,437(9)       10,000         65,437/3.7%

Donald Fleischer (7)......     26,125(10)       10,000         16,125/*

Peter Hanelt (7)..........      10,000(8)       10,000                 0

Stephen Seligman (7)......     15,000(11)       10,000          5,000/*

- -----------------------
*        less than 1%.

(1)      Mr.  Zanker is the Chairman of the Board,  President  and a director of
         the Company.

(2)      Includes (i) 63,562  shares of Common Stock held by The William  Zanker
         Trust for the benefit of his children (Mr. Zanker disclaims  beneficial
         ownership of such  shares),  (ii) 18,750 shares of Common Stock held by
         Debbie  Dworkin,  Mr. Zanker's wife (Mr.  Zanker  disclaims  beneficial
         ownership of such shares),  (iii) options to purchase 100,000 shares of
         Common Stock at an exercise  price of $1.875 per share and (iv) options
         to purchase  120,000  shares of Common  Stock at an  exercise  price of
         $3.75 per share.

(3)      Mr.  Murray  is the  Chief  Executive  Officer  and a  director  of the
         Company.

(4)      Includes (i) options to purchase  100,000  shares of Common Stock at an
         exercise price of $1.875 per share and (ii) options to purchase 120,000
         shares of Common Stock at an exercise price of $3.75 per share.

(5)      Mr. Dee is the Chief Financial Officer and Secretary of the Company.

(6)      Represents (i) options to purchase  10,000 shares of Common Stock at an
         exercise price of $2.5625 per share and (ii) options to purchase 90,000
         Shares of Common Stock at an exercise price of $2.375 per share.

                                      -11-
(7)      Messrs. Faber, Hyams, Fleischer,  Hanelt, and Seligman are directors of
         the Company.

(8)      Represents  options to  purchase  10,000  shares of Common  Stock at an
         exercise price of $5.00 per share.

(9)      Includes  (i) 1,875  shares of Common  Stock held by Mr.  Hyams and his
         wife as joint  tenants  with the  right of  survivorship,  (ii)  63,562
         shares of Common Stock held as trustee for The William Zanker Trust and
         (iii) options to purchase  10,000 shares of Common Stock at an exercise
         price of $5.00 per share.

(10)     These shares  consist of (i) 3,625 shares held by Mr.  Fleischer,  (ii)
         10,000  shares  issuable  upon the  exercise  of options at an exercise
         price of $5.00  per share and (iii)  12,500  shares  issuable  upon the
         exercise of warrants purchased by Mr. Fleischer in the Company's bridge
         financing.

(11)     Includes (i) 5,000 shares of Common Stock held by Mr.  Seligman and his
         wife as joint tenants with the right of  survivorship  and (ii) options
         to purchase 10,000 shares of Common Stock at an exercise price of $5.00
         per share.

                              PLAN OF DISTRIBUTION

         It is anticipated that all of the Shares will be offered by the Selling
Shareholders  from time to time in the open market,  either  directly or through
brokers  or  agents,  or  in  privately  negotiated  transactions.  The  Selling
Shareholders  have  advised  the  Company  that  they  are  not  parties  to any
agreement, arrangement or understanding as to such sales.

                                  LEGAL MATTERS

         Certain  legal  matters in  connection  with the issuance of the Shares
offered hereby have been passed upon for the Company by Olshan  Grundman Frome &
Rosenzweig  LLP,  505  Park  Avenue,   New  York,  New  York  10022.  Such  firm
beneficially owns 7,500 shares of Common Stock of the Company. Stephen Irwin, of
counsel to Olshan  Grundman  Frome &  Rosenzweig  LLP,  beneficially  owns 2,800
shares of Common Stock of the Company.

                             ADDITIONAL INFORMATION

         The Company has filed with the  Securities  and  Exchange  Commission a
Registration  Statement on Form S-8 (together  with all  amendments and exhibits
thereto, the "Registration  Statement") under the Securities Act with respect to
the  Shares  offered  hereby.  This  Prospectus  does  not  contain  all  of the
information set forth in the Registration Statement,  certain parts of which are
omitted in accordance  with the rules and  regulations  of the  Commission.  For
further  information  with  respect to the  Company and the  securities  offered
hereby, reference is made to the Registration Statement. Statements contained in
this  Prospectus  as to the contents of any  contract or other  document are not
necessarily  complete,  and in each  instance,  reference is made to the copy of
such  contract or document  filed as an exhibit to the  Registration  Statement,
such statement being qualified in all respects by such reference.

                                      -12-
PART II

               INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

ITEM 3.  INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

         The  following   documents  filed  with  the  Securities  and  Exchange
Commission (the  "Commission")  are incorporated  herein by reference and made a
part hereof:

                  (a) The  Company's  Annual  Report on Form 10-KSB for the year
         ended December 31, 1995.

                  (b) The  Company's  Quarterly  Report on Form  10-QSB  for the
         quarter ended March 31, 1996.

                  (c) The description of the Company's  securities  contained in
         the Company's  Registration Statement on Form 8-A filed on February 23,
         1995.

          All  reports  and other  documents  subsequently  filed by the Company
pursuant to Sections 13, 14 and 15(d) of the Securities Exchange Act of 1934, as
amended, prior to the filing of a post-effective  amendment which indicates that
all securities offered hereby have been sold or which deregisters all securities
remaining unsold,  shall be deemed to be incorporated by reference herein and to
be a part hereof from the date of the filing of such reports and documents.

ITEM 4.  DESCRIPTION OF SECURITIES

         Not applicable.

ITEM 5.  INTEREST OF NAMED EXPERTS AND COUNSEL

          Certain legal  matters in  connection  with the issuance of the Shares
offered hereby have been passed upon for the Company by Olshan  Grundman Frome &
Rosenzweig  LLP,  505  Park  Avenue,   New  York,  New  York  10022.  Such  firm
beneficially owns 7,500 shares of Common Stock of the Company. Stephen Irwin, of
counsel to Olshan  Grundman  Frome &  Rosenzweig  LLP,  beneficially  owns 2,800
shares of Common Stock of the Company.

ITEM 6.  INDEMNIFICATION OF OFFICERS AND DIRECTORS

          Except  as  hereinafter  set  forth,  there  is  no  statute,  charter
provision,  by-law,  contract or other  arrangement  under which any controlling
person,  director  or officer of the  Company is insured or  indemnified  in any
manner against liability which he may incur in his capacity as such.

          The  Company's  authority to indemnify  its  directors and officers is
governed  by the  provisions  of  Sections  721 to 726 of the New York  Business
Corporation Law (the "BCL"), as follows:

          Section 721 Nonexclusivity of Statutory Provisions for Indemnification
of Directors and Officers -- The  indemnification  and  advancement  of expenses
granted  pursuant to, or provided by, this article shall not be deemed exclusive
of any other rights to which a director or officer  seeking  indemnification  or
advancement of expenses may be entitled, whether contained in the certificate of
incorporation  or the  by-laws  or,  when  authorized  by  such  certificate  of
incorporation or by-laws, (i) a resolution of shareholders, (ii) a resolution of
directors,  or (iii) an agreement providing for such  indemnification,  provided
that no  indemnification  may be made to or on behalf of any director or officer
if a judgment or other  final  adjudication  adverse to the  director or officer
establishes  that his acts were  committed  in bad  faith or were the  result of
active and  deliberate  dishonesty  and were  material to the cause of action so
adjudicated, or that he personally gained in fact a financial profit or other

                                      II-1
advantage  to which  he was not  legally  entitled.  Nothing  contained  in this
article shall affect any rights to indemnification to which corporate  personnel
other than directors and officers may be entitled by contract or otherwise under
law.

         Section 722 Authorization for Indemnification of Directors and Officers
- -- (a) A corporation may indemnify any person, made, or threatened to be made, a
party to an  action  or  proceeding  other  than  one by or in the  right of the
corporation  to procure a  judgment  in its favor,  whether  civil or  criminal,
including an action by or in the right of any other  corporation  of any type or
kind, domestic or foreign, or any partnership,  joint venture,  trust,  employee
benefit  plan  or  other  enterprise,  which  any  director  or  officer  of the
corporation served in any capacity at the request of the corporation,  by reason
of the fact that he, his testator or intestate, was a director or officer of the
corporation,  or served  such other  corporation,  partnership,  joint  venture,
trust,  employee  benefit  plan or other  enterprise  in any  capacity,  against
judgments, fines, amounts paid in settlement and reasonable expenses,  including
attorneys' fees actually and necessarily  incurred as a result of such action or
proceeding,  or any appeal  therein,  if such director or officer acted, in good
faith,  for a purpose which he reasonably  believed to be in, or, in the case of
service for any other  corporation or any  partnership,  joint  venture,  trust,
employee benefit plan or other enterprise, not opposed to, the best interests of
the corporation  and, in criminal  actions or proceedings,  in addition,  had no
reasonable cause to believe that his conduct was unlawful.

                  (b) The  termination  of any such civil or criminal  action or
proceeding  by  judgment,  settlement,   conviction  or  upon  a  plea  of  nolo
contendere, or its equivalent, shall not in itself create a presumption that any
such  director or officer did not act,  in good  faith,  for a purpose  which he
reasonably  believed  to be in,  or,  in the  case  of  service  for  any  other
corporation or any partnership,  joint venture,  trust, employee benefit plan or
other enterprise,  not opposed to, the best interests of the corporation or that
he had reasonable cause to believe that his conduct was unlawful.

                  (c) A corporation may indemnify any person made, or threatened
to be made,  a party to an  action  by or in the  right  of the  corporation  to
procure a judgment  in its favor by reason of the fact that he, his  testator or
intestate,  is or was a director  or officer  of the  corporation,  or is or was
serving at the request of the  corporation as a director or officer of any other
corporation of any type or kind, domestic or foreign, of any partnership,  joint
venture, trust, employee benefit plan or other enterprise,  against amounts paid
in settlement and reasonable  expenses,  including attorneys' fees, actually and
necessarily incurred by him in connection with the defense or settlement of such
action,  or in  connection  with an appeal  therein if such  director or officer
acted, in good faith,  for a purpose which he reasonably  believed to be in, or,
in the case of  service  for any other  corporation  or any  partnership,  joint
venture,  trust, employee benefit plan or other enterprise,  not opposed to, the
best interests of the  corporation,  except that no  indemnification  under this
paragraph  shall be made in respect  of (1) a  threatened  action,  or a pending
action  which is settled or  otherwise  disposed  of, or (2) any claim  issue or
matter as to which  such  person  shall have been  adjudged  to be liable to the
corporation,  unless and only to the  extent  that the court in which the action
was brought, or, if no action was brought, any court of competent  jurisdiction,
determines upon application  that, in view of all the circumstances of the case,
the person is fairly and  reasonably  entitled to indemnity  for such portion of
the settlement amount and expenses as the court deems proper.

                  (d) For the purpose of this section,  a  corporation  shall be
deemed to have  requested a person to serve an employee  benefit  plan where the
performance by such person of his duties to the corporation  also imposes duties
on, or otherwise  involves  services by, such person to the plan or participants
or beneficiaries of the plan; excise taxes assessed on a person with respect to

                                      II-2
an employee  benefit plan pursuant to applicable law shall be considered  fines;
and action taken or omitted by a person with respect to an employee benefit plan
in the performance of such person's duties for a purpose reasonably  believed by
such person to be in the interest of the participants  and  beneficiaries of the
plan  shall be  deemed  to be for a  purpose  which is not  opposed  to the best
interests of the corporation.

         Section 723 Payment of Indemnification Other Than By Court Award -- (a)
A person who has been successful,  on the merits or otherwise, in the defense of
a civil or criminal  action or proceeding of the character  described in section
722 shall be entitled to indemnification as authorized in such section.

                  (b) Except as provided in paragraph  (a), any  indemnification
under  section 722 or otherwise  permitted by section 721,  unless  ordered by a
court under section 724  (Indemnification of directors and officers by a court),
shall be made by the corporation, only if authorized in the specific case:

                           (1)   By the board acting by a quorum  consisting  of
directors who are not parties to such action or  proceeding  upon a finding that
the director or officer has met the standard of conduct set forth in section 722
or established pursuant to section 721, as the case may be, or,

                           (2)   If a  quorum  under  subparagraph  (1)  is  not
obtainable  or,  even if  obtainable,  a quorum of  disinterested  directors  so
directs;

                           (A)   By the board  upon the  opinion  in  writing of
independent  legal counsel that  indemnification  is proper in the circumstances
because the  applicable  standard of conduct set forth in such sections has been
met by such director or officer, or

                           (B)   By the  shareholders  upon a  finding  that the
director or officer has met the applicable standard of conduct set forth in such
sections.

                  (c) Expenses  incurred in defending a civil or criminal action
or proceeding may be paid by the corporation in advance of the final disposition
of such action or proceeding  upon receipt of an  undertaking by or on behalf of
such director or officer to repay such amount as, and to the extent, required by
paragraph (a) of section 725.

         Section 724 Indemnification of Directors and Officers by a Court -- (a)
Notwithstanding  the failure of a corporation  to provide  indemnification,  and
despite  any  contrary  resolution  of the board or of the  shareholders  in the
specific case under section 723 (Payment of indemnification  other than by court
award),  indemnification  shall be awarded  by a court to the extent  authorized
under section 722 (Authorization for indemnification of directors and officers),
and  paragraph  (a) of section 723.  Application  therefor may be made, in every
case, either:

                           (1)   In the civil action or  proceeding in which the
expenses were incurred or other amounts were paid, or

                           (2)   To the supreme court in a separate  proceeding,
in which case the  application  shall set forth the  disposition of any previous
application made to any court for the same or similar relief and also reasonable
cause  for the  failure  to make  application  for  such  relief  in  action  or
proceeding in which the expenses were incurred or other amounts were paid.

                           (b)   The  application  shall be made in such  manner
and form as may be required by the applicable  rules of court or, in the absence
thereof,  by direction of a court to which it is made. Such application shall be
upon notice to the  corporation.  The court may also direct that notice be given
at the

                                      II-3
expense of the corporation to the  shareholders and such other persons as it may
designate in such manner as it may require.

                           (c)   Where  indemnification  is sought  by  judicial
action,  the  court  may  allow a person  such  reasonable  expenses,  including
attorneys'  fees,  during the  pendency of the  litigation  as are  necessary in
connection with his defense therein,  if the court shall find that the defendant
has by his  pleadings  or during the  course of the  litigation  raised  genuine
issues of fact or law.

         Section 725 Other Provisions Affecting Indemnification of Directors and
Officers -- (a) All expenses incurred in defending a civil or criminal action or
proceeding which are advanced by the corporation  under paragraph (c) of section
723 (Payment of indemnification other than by court award) or allowed by a court
under paragraph (c) of section 724 (Indemnification of directors and officers by
a court)  shall be repaid  in case the  person  receiving  such  advancement  or
allowance is  ultimately  found,  under the procedure set forth in this article,
not to be entitled to indemnification  or, where  indemnification is granted, to
the extent the expenses so advanced by the  corporation  or allowed by the court
exceed the indemnification to which he is entitled:

                  (b)   No  indemnification,  advancement or allowance  shall be
made under this article in any circumstance where it appears:

                        (1)  That the indemnification would be inconsistent with
the law of the  jurisdiction of  incorporation  of a foreign  corporation  which
prohibits or otherwise limits such indemnification;

                        (2)  That the indemnification would be inconsistent with
a provision of the certificate of  incorporation,  a by-law, a resolution of the
board or of the shareholders,  an agreement or other proper corporate action, in
effect at the time of the accrual of the alleged cause of action asserted in the
threatened  or pending  action or proceeding in which the expenses were incurred
or other amounts were paid, which prohibits or otherwise limits indemnification;
or

                        (3)  If there  has  been a  settlement  approved  by the
court,  that the  indemnification  would be inconsistent with any condition with
respect  to  indemnification  expressly  imposed by the court in  approving  the
settlement.

                  (c)   If any  expenses  or  other  amounts  are paid by way of
indemnification,  otherwise  than by court order or action by the  shareholders,
the  corporation  shall,  not later than the next annual meeting of shareholders
unless such meeting is held within  three months from the date of such  payment,
and in any event,  within fifteen months from the date of such payment,  mail to
its  shareholders  of record at the time  entitled  to vote for the  election of
directors a statement  specifying  the persons paid,  the amounts paid,  and the
nature and status at the time of such payment of the  litigation  or  threatened
litigation.

                  (d)   If  any  action  with  respect  to   indemnification  of
directors  and officers is taken by way of amendment of the by-laws,  resolution
of directors,  or by agreement,  then the corporation  shall, not later than the
next annual  meeting of  shareholders,  unless such meeting is held within three
months from the date of such action,  and, in any event,  within  fifteen months
from the date of such  action,  mail to its  shareholders  of record at the time
entitled to vote for the election of directors a statement specifying the action
taken.

                  (e)   Any  notification  required  to be made  pursuant to the
foregoing  paragraph (c) or (d) of this section by any domestic  mutual  insurer
shall be satisfied by compliance  with the  corresponding  provisions of section
one thousand two hundred sixteen of the insurance law.

                                      II-4
(f)   The    provisions   of   this   article    relating   to
indemnification  of directors and officers and insurance therefor shall apply to
domestic  corporations  and foreign  corporations  doing business in this state,
except as provided in section 1320 (Exemption from certain provisions).

         Section 726 Insurance for  Indemnification of Directors and Officers --
(a) Subject to  paragraph  (b), a  corporation  shall have power to purchase and
maintain insurance:

                        (1)    To indemnify the  corporation  for any obligation
which it incurs as a result of the  indemnification  of  directors  and officers
under the provisions of this article, and

                        (2)    To indemnify  directors and officers in instances
in which they may be indemnified by the corporation under the provisions of this
article, and

                        (3)    To indemnify  directors and officers in instances
in which they may not  otherwise be  indemnified  by the  corporation  under the
provisions  of this article  provided the  contract of insurance  covering  such
directors and officers provides, in a manner acceptable to the superintendent of
insurance, for a retention amount and for co-insurance.

                  (b)   No  insurance  under  paragraph  (a) may provide for any
payment, other than cost of defense, to or on behalf of any director or officer.

                        (1)     if  a  judgment  or  other  final   adjudication
adverse to the insured  director or officer  establishes that his acts of active
and deliberate  dishonesty  were material to the cause of action so adjudicated,
or that he personally  gained in fact a financial  profit or other  advantage to
which he was not legally entitled, or

                        (2)     in relation to any risk the  insurance  of which
is prohibited under the insurance law of this state.

                  (c)   Insurance  under any or all  subparagraphs  of paragraph
(a) may be included in a single  contract or supplement  thereto.  Retrospective
rated contracts are prohibited.

                  (d)   The  corporation  shall,  within  the  time  and  to the
persons  provided in paragraph  (c) of section 725 (Other  provisions  affecting
indemnification  of directors or  officers),  mail a statement in respect of any
insurance  it has  purchased  or renewed  under  this  section,  specifying  the
insurance  carrier,  date  of the  contract,  cost of the  insurance,  corporate
positions insured,  and a statement explaining all sums, not previously reported
in a  statement  to  shareholders,  paid  under  any  indemnification  insurance
contract.

                  (e)   This  section  is the  public  policy  of this  state to
spread the risk of corporate  management,  notwithstanding  any other general or
special  law of this state or of any other  jurisdiction  including  the federal
government.

                       ----------- ------------ ----------

         The Company's  certificate of incorporation  provides that the personal
liability of the directors of the Company is  eliminated  to the fullest  extent
permitted by Section 402(b) of the BCL.

ITEM 7.  EXEMPTION FROM REGISTRATION CLAIMED

         Not applicable.

                                      II-5
ITEM 8.  EXHIBITS

          4(a)   -         The Great American BackRub Store,  Inc. 1994 Employee
                           Stock Option Plan (the "1994 Plan")  (incorporated by
                           reference   to   Exhibit   4.4   to   the   Company's
                           Registration   Statement   on  Form  SB-2  (File  no.
                           33-88052)).

          4(b)   -         Stock Option Agreement dated as of December 23, 1994,
                           by and between the Company and William Zanker.

          4(c)   -         Stock Option  Agreement dated as of July 19, 1995, by
                           and between the Company and William Zanker.

          4(d)   -         Stock Option Agreement dated as of December 23, 1994,
                           by and between the Company and Terrance Murray.

          4(e)   -         Stock Option  Agreement dated as of July 19, 1995, by
                           and between the Company and Terrance Murray.

          4(f)   -         Stock Option  Agreement dated as of July 27, 1995, by
                           and between the Company and Simon Abrahams.

          4(g)   -         Stock Option  Agreement dated as of July 27, 1995, by
                           and between the Company and Keith Dee.

          4(h)   -         Stock Option  Agreement dated as of December 15, 1995
                           by and between the Company and Keith Dee.

          4(i)   -         Form of Stock  Option  Agreement  by and  between the
                           Company  and  Edward  Faber,   Andrew  Hyams,  Donald
                           Fleischer, Peter Hanelt and Stephen Seligman.

           5     -         Opinion of Olshan, Grundman, Frome & Rosenzweig LLP.

         23(a)   -         Consent of BDO Seidman, LLP, independent auditors.

         23(b)   -         Consent of Olshan,  Grundman,  Frome & Rosenzweig LLP
                           (included in its opinion filed as Exhibit 5).

         24      -         Powers of Attorney (included on the signature page to
                           this Registration Statement).

ITEM 9.  UNDERTAKINGS.

         A.       The undersigned registrant hereby undertakes:

                  (1)      To file,  during any period in which  offers or sales
                           are being made,  a  post-effective  amendment to this
                           Registration  Statement to include any  additional or
                           changed   material   information   on  the   plan  of
                           distribution.

                  (2)      That, for the purposes of  determining  any liability
                           under the  Securities  Act of 1933, as amended,  each
                           such post-effective amendment shall be deemed to be a
                           new registration statement relating to the securities
                           offered therein,  and the offering of such securities
                           at that time shall be deemed to be the  initial  bona
                           fide offering thereof; and

                  (3)      To   remove   from   registration   by   means  of  a
                           post-effective  amendment any of the securities being
                           registered  that remain unsold at the  termination of
                           the offering.

                                      II-6
B.       The  undersigned   registrant   hereby  undertakes  that,  for
                  purposes of determining any liability under the Securities Act
                  of  1933,  each  filing  of  the  registrant's  annual  report
                  pursuant to Section 13(a) or 15(d) of the Securities  Exchange
                  Act of 1934 (and, where applicable, each filing of an employee
                  benefit plan's annual report  pursuant to Section 15(d) of the
                  Securities  Exchange  Act of  1934)  that is  incorporated  by
                  reference in this Registration Statement shall be deemed to be
                  a  new  registration  statement  relating  to  the  securities
                  offered  therein,  and the offering of such securities at that
                  time  shall be deemed  to be the  initial  bona fide  offering
                  thereof.

         C.       Insofar as indemnification  for liabilities  arising under the
                  Securities  Act of  1933,  as  amended,  may be  permitted  to
                  directors,  officers and controlling persons of the registrant
                  pursuant  to  the  foregoing  provisions,  or  otherwise,  the
                  registrant  has  been  advised  that  in  the  opinion  of the
                  Securities and Exchange  Commission  such  indemnification  is
                  against  public policy as expressed in the  Securities  Act of
                  1933, as amended,  and is,  therefore,  unenforceable.  In the
                  event   that  a  claim  for   indemnification   against   such
                  liabilities  (other  than the  payment  by the  registrant  of
                  expenses   incurred  or  paid  by  a   director,   officer  or
                  controlling person of the registrant in the successful defense
                  of any  action,  suit  or  proceeding)  is  asserted  by  such
                  director, officer or controlling person in connection with the
                  securities being  registered,  the registrant will,  unless in
                  the opinion of its  counsel  the matter has been  settled by a
                  controlling  precedent,  submit  to  a  court  of  appropriate
                  jurisdiction the question whether such  indemnification  by it
                  is against public policy as expressed in the Securities Act of
                  1933,   as  amended,   and  will  be  governed  by  the  final
                  adjudication of such issue.

                                      II-7
SIGNATURES

         Pursuant  to the  requirements  of the  Securities  Act  of  1933,  the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this registration
statement  to be  signed  on its  behalf  by  the  undersigned,  thereunto  duly
authorized  in the City of New York,  State of New York,  on this 6th day of May
1996.

                                         THE GREAT AMERICAN BACKRUB STORE, INC.
                                         --------------------------------------
                                                     (Registrant)

                                         By:  /s/ William Zanker
                                              --------------------------------
                                         William Zanker, Chairman of the Board

                                POWER OF ATTORNEY

         KNOW  ALL MEN BY THESE  PRESENTS,  that  each  person  whose  signature
appears below  constitutes and appoints  William Zanker,  Terrance C. Murray and
Keith Dee his true and lawful  attorneys-in-fact  and agent,  with full power of
substitution and resubstitution, for and in his or her name, place and stead, in
any and all  capacities,  to sign  any or all  amendments  to this  Registration
Statement,  and to file the same, with all exhibits thereto, and other documents
in connection therewith,  with the Securities and Exchange Commission,  granting
unto said attorney-in-fact and agent, full power and authority to do and perform
each and  every act and thing  requisite  necessary  to be done in and about the
premises, as fully to all intents and purposes as he or she might or could do in
person,  hereby  ratifying and  confirming  all that said  attorney-in-fact  and
agent, or his or her  substitute,  may lawfully do or cause to be done by virtue
hereof.

         Pursuant  to the  requirements  of the  Securities  Act of  1933,  this
registration  statement  has  been  signed  by  the  following  persons  in  the
capacities and on the date indicated.

         Signature                  Title                       Date

/s/ William Zanker             Chairman of the Board,        May 6, 1996
- ---------------------------    President and Director
        William Zanker                    

/s/ Terrance C. Murray         Chief Executive Officer       May 6, 1996
- ---------------------------    (principal executive
      Terrance C. Murray       officer) and Director
                                          

/s/ Keith Dee                  Chief Financial Officer       May 6, 1996
- ---------------------------    (principal financial 
           Keith Dee           officer and principal
                               accounting officer) and
                               Secretary

/s/ Stephen Seligman           Director                      May 6, 1996
- ---------------------------
       Stephen Seligman

/s/ Edward E. Faber            Director                      May 6, 1996
- ---------------------------
       Edward E. Faber

/s/ Peter Hanelt               Director                      May 6, 1996
- ---------------------------
         Peter Hanelt

/s/ Donald R. Fleischer        Director                      May 6, 1996
- ----------------------------
      Donald R. Fleischer

/s/ Andrew L. Hyams            Director                     May 6, 1996
- ----------------------------
       Andrew L. Hyams

                                      II-8
EXHIBIT INDEX

   Exhibit
     No.                                  Description

          4(a)   -         The Great American BackRub Store,  Inc. 1994 Employee
                           Stock Option Plan (the "1994 Plan")  (incorporated by
                           reference   to   Exhibit   4.4   to   the   Company's
                           Registration   Statement   on  Form  SB-2  (File  no.
                           33-88052)).

          4(b)   -         Stock Option Agreement dated as of December 23, 1994,
                           by and between the Company and William Zanker.

          4(c)   -         Stock Option  Agreement dated as of July 19, 1995, by
                           and between the Company and William Zanker.

          4(d)   -         Stock Option Agreement dated as of December 23, 1994,
                           by and between the Company and Terrance Murray.

          4(e)   -         Stock Option  Agreement dated as of July 19, 1995, by
                           and between the Company and Terrance Murray.

          4(f)   -         Stock Option  Agreement dated as of July 27, 1995, by
                           and between the Company and Simon Abrahams.

          4(g)   -         Stock Option  Agreement dated as of July 27, 1995, by
                           and between the Company and Keith Dee.

          4(h)   -         Stock Option Agreement dated as of December 15, 1995,
                           by and between the Company and Keith Dee.

          4(i)   -         Form of Stock  Option  Agreement  by and  between the
                           Company  and  Edward  Faber,   Andrew  Hyams,  Donald
                           Fleischer, Peter Hanelt, and Stephen Seligman.

             5   -         Opinion of Olshan, Grundman, Frome & Rosenzweig LLP.

         23(a)   -         Consent of BDO Seidman, LLP, independent auditors.

         23(b)   -         Consent of Olshan,  Grundman,  Frome & Rosenzweig LLP
                           (included in its opinion filed as Exhibit 5).

            24   -         Powers of Attorney (included on the signature page to
                           this Registration Statement).