U. S. Securities and Exchange Commission
                             Washington, D. C. 20549


                                   FORM 10-KSB


[X]  ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934

     For the fiscal year ended December 31, 2005
                               -----------------

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

     For the transition period from _________________ to __________________


                         Commission File No. 333-125268
                                             ----------


                          SOUTHERN SAUCE COMPANY, INC.
                          ----------------------------
        (Exact name of small business issuer as specified in its charter)


            FLORIDA                                               11-3737500
-------------------------------                              -------------------
(State or other jurisdiction of                               (I.R.S. Employer
 incorporation or organization)                              Identification No.)


                   11951 S.E. 57TH STREET, MORRISTON, FL 32668
                   -------------------------------------------
                    (Address of principal executive offices)


                                  352-486-4541
                                  ------------
                           (Issuer's telephone number)


Securities Registered under Section 12(b) of the Exchange Act:

     None.

Securities Registered under Section 12(g) of the Exchange Act:

     None.

<PAGE>

     Check whether the issuer is not required to file reports pursuant to
Section 13 or 15(d) of the Exchange Act. [ ]

     Check whether the Issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the Registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.

     Yes [X]  No [_]

     Check if there is no disclosure of delinquent filers in response to
Item 405 of Regulation S-B is not contained in this form, and no disclosure
will be contained, to the best of Registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part III of
this Form 10-KSB or any amendment to this Form 10-KSB. [X]

     State Issuer's revenues for its most recent fiscal year: None.

     As of February 10, 2006, there were 1,430,000 shares of our common stock
held by non-affiliates valued at $143,000 based upon sale price of our
convertible preferred stock within the last 60 days.

     As of February 10, 2006, the registrant had outstanding 2,930,500 shares of
its Common Stock, par value $.001, and 3,355 shares of Series A Convertible
Preferred Stock, par value $.001.

     Indicate by check mark whether the registrant is a shell company (as
defined in Rule 12b-2 of the Exchange Act). Yes [_] No [X]


                       DOCUMENTS INCORPORATED BY REFERENCE
                       -----------------------------------

     None.

     Transitional Small Business Issuer Format Yes [_] No [X]


                                        2
<PAGE>

                                TABLE OF CONTENTS

INTRODUCTION


PART I

Item 1.  Business..............................................................4

Item 2.  Properties............................................................8

Item 3.  Legal Proceedings.....................................................8

Item 4.  Submission of Matters to a vote of security holders...................8



PART II

Item 5.  Market for common equity and related stockholder matters..............8

Item 6.  Management's discussion and analysis or plan or operation............10

Item 7.  Financial Statements.................................................14



PART III

Item 8.  Changes & Disagreements with Accountants.............................26

Item 8A. Controls & Procedures................................................26

Item 8B. Other Information....................................................26

Item 9.  Directors, Executive officers, Promoters and Control persons
         Compliance with Section 16(a) of the Exchange Act....................27

Item 10. Executive Compensation...............................................29

Item 11. Security Ownership of certain beneficial owners and Management.......30

Item 12. Certain relationships and related transactions.......................30

Item 13. Exhibits.............................................................31

Item 14. Principal Accounting Fees and Services ..............................31


                                        3
<PAGE>

                                     PART I

ITEM 1.   DESCRIPTION OF BUSINESS.

     Southern Sauce Company, Inc. was incorporated in the State of Florida in
December 2004. Our business plan is to establish a successful specialty food
business based on proprietary recipes for barbecue sauces and other condiments
for the retail market. All activity to date has been related to the formation of
our business, formulation of our business plan and initial start-up operations
such as obtaining a recipe for our proposed initial product, investigating
sources of supply for product ingredients and packaging, reviewing labeling and
other regulatory requirements for our products, investigating potential
distribution channels for our products and development of our proposed
financing.

     Our offices are located at 11951 S.E. 57th Street, Morriston, FL 32668 and
our phone number is 352-486-4541.

OVERVIEW

     A stroll through any supermarket or gourmet market will confirm that the
market for specialty foods such as barbecue sauce is substantial and highly
competitive. More objective statistics are published by various trade
organizations and trade publications. For example, Supermarket News Sales
Yearbook published in August 2004, which covers food sales at supermarkets, drug
stores and mass merchandisers, reported that sales of barbecue sauces at
supermarkets were $350,573,100 during the 52 weeks ending June 13, 2004(1).
Progressive Grocer's 57th Annual Consumer Expenditures Study published in
September 2004, based on five years of comparable scan data from A C Nielsen and
estimates by Progressive Grocer's researchers, reported that 2003 sales of
barbecue sauces at supermarkets were $353,590,000(2).

     Other indications of the vibrancy of the barbecue market may be inferred
from collateral sources, such as the variety of barbecue grill models offered in
such stores as Home Depot and Sears as well as specialized grill stores.
According to exclusive consumer research by Mintel International (Chicago), as
reported in Prepared Foods, February 2004, some 73% of American families own a
barbecue grill. The outdoor barbecue market, estimated at $3.93 billion, can be
segmented into charcoal, gas, and electric grills, as well as barbecue equipment
accessories.(3)

     Consumer interest in barbecue can also be inferred from the number of
barbecue books in print. The website of the National Barbecue Association,
nbbqa.org, offers 41 barbecue books for sale. A search for "barbecue" in the
book section of the online bookseller amazon.com returns over 600 entries.

     While the market for barbecue sauces is considerable, it has low barriers
to entry. Besides the largest national brands, Kraft, Heinz and Hunts, there are
a large number of barbecue sauce products designed to appeal to regional tastes
which are generally sold locally.
_________

(1) Data from this report published by The Association for Dressings and Sauces
and available on the web at http://www.dressings-
sauces.org/condiment_trends_press.html#sales.

(2) Data from this report published by The Association for Dressings and Sauces
and available on the web at http://www.dressings-
sauces.org/condiment_trends_press.html#sales.

(3) Prepared Foods. February 2004. Available on the web at
http://www.preparedfoods.com/CDA/ArticleInformation/features/BNP_Features_Item
/0,1231,119152,00.html

                                        4
<PAGE>

MARKETING PLAN

     As a new entrant into a market with a number of established brands we will
seek to differentiate our initial barbecue sauce by appealing to consumers to
give our product a try and building customer loyalty on the following bases:

          (a) Brand positioning.
          (b) Product ingredients and taste.
          (c) Consumer education.
          (d) Marketing approach.

     We will seek to position our initial barbecue sauce product towards men
because we believe they are the primary users of barbecue sauce. Our initial
product, a mustard-based yellow barbecue sauce, looks and tastes different from
the established national brands. We will seek to stress the difference of our
product, both appearance and taste, and challenge consumers to "try something
new on your barbecue". We will also seek to educate consumers about the proper
way to use barbecue sauce. For example, we believe that many barbecue cooks
utilize barbecue sauce improperly. Food should not be basted or soaked with
barbecue sauce before being put on the grill. Rather, barbecue sauce should be
used at the latter part of cooking process to avoid burning in the intense heat
of the barbecue grill.

DISTRIBUTION

     Our target market for initial product distribution will be specialty
gourmet food stores. These retailers compete by selling products which are not
generally available at large supermarket chains and are highly selective in
their merchandising. We believe that consumers choose to shop at specialty
gourmet food stores for a different shopping experience and that they are open
to try a new product not available at the chain supermarkets or supported by
large advertising budgets. We believe that gourmet food stores are more willing
to try a new product and will place initial orders in small amounts.

     In order to establish initial distribution we anticipate that we will
directly approach gourmet food stores to purchase our products through our
management and attend trade shows for the gourmet food trade. We will also seek
to establish our brand through public relations, an internet site and an
internet blog.

     Subject to initial success of our initial product introduction, we will
seek to engage food brokers to represent us in contacting distributors and
larger retailers. At that point we anticipate formulating a sales and marketing
presentation to aid the brokers in representing our products to retail and
distributor buyers. The key competitive factors in influencing a purchasing
decision on this level include the product quality, packaging, sales history,
profitability, and consumer demand. If a buyer decides to accept our product,
other issues such as the cost of acquiring shelf space (slotting fees) and our
specific commitments to marketing programs will be negotiated. Slotting fees can
take the form of cash payments and/or free product allowances.

     We cannot assure you that we will be successful in establishing
distribution for our initial product or that our sales will be sufficient to
enable us to achieve positive cash flow and earnings.

MANUFACTURING

     We anticipate using contract packers to manufacture our products according
to our specifications, which will include our products' recipes, ingredients,
graphics and packaging. We will be responsible for having all the components of
the products shipped to the contract packer. Based on our initial discussions

                                        5
<PAGE>

with several contract packers we believe that we will be able to engage one or
more contract packers that could manufacture our products. However, we have not
engaged a contract packer at this time. We do not anticipate entering into an
exclusive or long term agreement with any packers.

RAW MATERIALS AND SUPPLIERS

     Based upon our initial investigations, we believe that there are a number
of sources available for product ingredients, packaging, and printing for our
products. We do not anticipate that it will be necessary to execute any
exclusive or long term agreements for such raw material and supplies.

PROMOTION AND ADVERTISING

     We intend to initially rely upon point of purchase promotions, trade
magazines, public relations and the internet to promote our products. Point of
purchase promotional advertising will constitute the most significant portion of
our promotion and advertising activities. This will include sampling programs,
displays and brochures which we intend to provide to each retail outlet for our
products in an effort to get customers to try our product. We will rely on
public relations to trade publications to enhance retailer awareness of our
products. Internet will be utilized for consumer awareness and retailer
awareness purposes.

TRADEMARKS, PATENTS AND INTELLECTUAL PROPERTY

     We expect to seek trademark protection for our products as soon as each
product trademark is selected, as well as our slogan -Try something new on your
Barbecue. We will do a search of existing trademarks prior to selecting
trademarks for our products. We believe that trademark protection will be
important to brand name recognition and distributor and consumer loyalty to our
products. We intend to register our important trademarks in the United States.
We will use our best efforts to maintain the confidentiality of our product
recipes through confidentiality agreements and physical security but do not
anticipate that it will be possible to secure patents for our products.

OUR INITIAL PRODUCT

     Our initial product is a yellow mustard based barbecue sauce formulated in
the tradition of the classic mustard based barbecue sauce popular in South
Carolina. Our sauce is made from all natural ingredients and contains no
cholesterol. It can be used on any food grilled on the barbecue grill as well as
on the table as a dipping sauce. We licensed the recipe for our initial product
from David E. Jordan, a stockholder and promoter of our company.

OUR LICENSE AGREEMENT

     We have an exclusive worldwide license agreement with David E. Jordan, a
shareholder and father of our president, allowing us to use a recipe developed
by Mr. Jordan for our initial yellow mustard-based barbecue sauce. Under the
license agreement, we have the exclusive right to use the recipe related
know-how of Mr. Jordan. We issued Mr. Jordan 500,000 shares of our common stock
as consideration for the license. We agreed to exercise our best efforts,
consistent with good business practice, to undertake and maintain the commercial
scale production, marketing and distribution of products embodying the subject
matter of the recipe. Mr. Jordan may cancel and terminate the license in the
event that we have not introduced a product into the commercial marketplace
based on his recipe and recognize revenues of $500,000 from sale of such product
by September 30, 2006. We are not required to pay Mr. Jordan any additional fees
for use of the recipe. However, in the event we make an outright sale of the
license or sub-license of the recipe we shall share in the proceeds equally
(50/50 split) with Mr. Jordan.

                                        6
<PAGE>

FUTURE PRODUCTS

     We intend to introduce new products including other unusual barbecue sauce
recipes and a smoked salt condiment product which we have already developed.
However, there can be no assurance that any future products will be successfully
marketed.

GOVERNMENT REGULATION

     The production, distribution and sale of food products are subject to the
Federal Food, Drug and Cosmetic Act, the Occupational Safety and Health Act and
various federal and state statutes regulating the production, sale, safety,
advertising, promotion, labeling and ingredients of such products. We intend to
comply with all such regulations.

     We cannot predict the impact of possible changes that may be required in
response to future legislation, rules or regulations. Food and Drug
Administration regulations may, in certain circumstances, affect the ability of
the Company, as well as others in the industry, to develop and market new
products.

     Although we expect to package our barbecue sauce products in glass bottles,
such bottles are not currently required to be in returnable containers in
compliance with recycling laws which are applicable to beverage containers. If
such recycling laws are extended to our products we may be required to make
material expenditures which may have a material adverse effect on our business.

COMPETITION

     The specialty foods business is highly competitive. In the barbecue sauce
market we will compete with products sold by established multi-line food
companies such as Kraft as well as a large number of smaller suppliers with
products appealing to regional and national tastes. Many of these competitors
have established channels of distribution of their products, greater financial
and other resources than we do. Competition can take many forms, including the
product taste and other attributes, pricing of products, discounts and
promotions, advertising and payments for access to store shelf space. We believe
that we will be able to compete based upon the unusual taste and appearance of
our initial product and our distribution and promotion plans designed to engage
consumers to try our product.

EMPLOYEES

     As of January 5, 2006, we have no full-time employees. All activities since
our organization have been undertaken by our officers as needed. Our officers do
not currently spend all of their time on our business and estimate they devote
approximately 5% of their business time on the business of the Company. We
anticipate that we will begin hiring employees as needed to support our entry
into our proposed specialty food business.

FACILITIES

     Our company is currently housed in the home of our president. We do not pay
our president for use of such space. We anticipate that we will rent separate
office facilities when needed to support the growth of our business. We do not
currently anticipate the need for warehouse space for our business. We expect
all warehouse and shipping of our products to be conducted by the packing firms
engaged to manufacture our products.

                                        7
<PAGE>

ITEM 2.   DESCRIPTION OF PROPERTY.

     Our company is currently housed in the home of our president. We do not pay
our president for use of such space. We anticipate that we will rent separate
office facilities when needed to support the growth of our business. We do not
currently anticipate the need for warehouse space for our business. We expect
all warehouse and shipping of our products to be conducted by the packing firms
engaged to manufacture our products.

ITEM 3.   LEGAL PROCEEDINGS.

     None.

ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

     None.

                                     PART II

ITEM 5.   MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

MARKET INFORMATION.

     There is no established public market for shares of our common stock or
preferred stock.

HOLDERS.

     As of January 18, 2006 there were approximately 13 holders of our common
stock and 33 holders of our preferred stock.

DIVIDENDS.

     There are no present material restrictions that limit our ability to pay
dividends on common stock or preferred stock. The Company has not paid any
dividends with respect to its common stock or preferred stock, and does not
anticipate payment of dividends in the foreseeable future.

EQUITY COMPENSATION PLAN INFORMATION AS OF DECEMBER 31, 2005.

     The Company has used its common stock to pay for services rendered to the
Company and for acquiring a license to use a barbecue sauce recipe. The
following table summarizes information about outstanding equity compensation
plans as of December 31, 2005.
<TABLE>
<CAPTION>
                                     Number of                                  Number of securities
                                  securities to be         Weighted-           remaining available for
                                    issued upon        average exercise     future issuance under equity
                                    exercise of            price of             compensation plans
                                    outstanding          outstanding           (excluding securities
                                  options/warrants     options/warrants       reflected in column (a))
Plan Category                            (a)                  (b)                        (c)
-------------                     ----------------     ----------------     ----------------------------
<S>                                       <C>                 <C>                         <C>
Equity compensation plans
 approved by security holders             0                   $ -                         0

Equity compensation plans not
 approved by security holders             0                   $ -                         0

Total                                     0                   $ -                         0
</TABLE>

                                        8
<PAGE>

INDIVIDUAL EQUITY COMPENSATION ARRANGEMENTS NOT APPROVED BY SHAREHOLDERS

     David E. Jordan received 500,000 shares of common stock for licensing a
barbecue sauce to us.

     Robert E. Jordan received 122,500 shares of common stock for serving as a
director until the next annual meeting of shareholders.

     Francis A. Rebello received 122,500 shares of common stock for serving as a
director until the next annual meeting of shareholders.

RECENT SALES OF UNREGISTERED SECURITIES

     The following provides information concerning all sales of our securities
which we made in the year ended December 31, 2005 which were not registered
under the Securities Act of 1933.

     In the quarter ended March 31, 2005 we sold 900,000 shares of our common
stock to the following eight (8) accredited investors for $36,000 ($0.04 per
share). No broker dealer was involved in the sale of the shares and no
commissions or other remuneration was paid in connection with these sales. The
shares were issued in a private placement to accredited investors pursuant to an
exemption from registration under the Securities Act of 1933 pursuant to Section
4(2) thereof. The shareholders who received the forgoing shares signed a
subscription agreement acknowledging that the shares were not registered under
the Securities Act of 1933, and could only be sold under a registration or
exemption from registration. Each certificate for such shares contains a
restrictive legend concerning the foregoing restrictions on transfer and a stop
transfer order has been lodged against such shares. Each investor was offered
access to our books and records and the opportunity to ask our officers
questions and receive answers concerning the terms and condition of the offering
and the company.

Stockholder                Shares
-----------                ------
Frank Hawkins              150,000
Wirt Maxey                 150,000
Edward Legere              150,000
Joe Schweiger               75,000
John Goldberg               75,000
C. Michael Janowitz        150,000
Robert K.Whitt              75,000
John Haggiag                75,000

USE OF PROCEEDS FROM INITIAL PUBLIC OFFERING.

     Our Registration Statement on Form SB-2 (Commission File No. 333-125268)
became effective on November 1, 2005. We registered 50,000 shares of Series A
Convertible Preferred Stock for sale by the Company for the aggregate price of
$500,000 and also registered the shares of our Common Stock into which the
shares of our Series A Convertible Preferred Stock may be converted. The
offering was commenced on November 4, 2005 and has not been terminated. The
offering is being made directly by us and is not being underwritten.

     Through February 1, 2006 we sold 3,555 shares of our preferred stock in the
offering for an aggregate offering price of $35,550.

     From November 1, 2005 through December 31, 2005 we incurred approximately
$0 in expenses related to the issuance and distribution of the shares registered
in the offering. None of such payments were direct or indirect payments to our
directors, officers, or to persons owning ten (10) percent or more of any class
of our equity securities or to affiliates of the issuer; or direct or indirect
payments to others. Such proceeds have been added to working capital.

                                        9
<PAGE>

ITEM 6.   MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION AND FORWARD
          LOOKING INFORMATION.

FORWARD LOOKING INFORMATION

     The following discussion and analysis of the Company's financial condition
and results of operations should be read with the condensed financial statements
and related notes contained in this annual report on Form 10-KSB ("Form
10-KSB"). All statements other than statements of historical fact included in
this Form 10-KSB are, or may be deemed to be, forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. These statements involve known and unknown
risks, uncertainties and other factors that may cause the Company's actual
results, levels of activity, performance or achievements to be materially
different than any expressed or implied by these forward-looking statements. In
some cases, you can identify forward-looking statements by terminology such as
"may," "will," "should," "expects," "plans," "anticipates," "believes,"
"estimates," "predicts," "potential," "continue," or the negative of these terms
or other comparable terminology. Important factors that could cause actual
results to differ materially from those discussed in such forward-looking
statements include: 1. General economic factors including, but not limited to,
changes in interest rates and trends in disposable income; 2. Information and
technological advances; 3. Cost of products sold; 4. Competition; and 5. Success
of marketing, advertising and promotional campaigns. The Company is subject to
specific risks and uncertainties related to its business model, strategies,
markets and legal and regulatory environment You should carefully review the
risks described in this Form 10-KSB and in other documents the Company files
from time to time with the SEC. You are cautioned not to place undue reliance on
the forward-looking statements, which speak only as of the date of this Form
10-KSB. The Company undertakes no obligation to publicly release any revisions
to the forward-looking statements to reflect events or circumstances after the
date of this document.

CRITICAL ACCOUNTING POLICIES

The Company has identified the policies outlined below as critical to its
business operations and an understanding of its results of operations. The
listing is not intended to be a comprehensive list of all of the Company's
accounting policies. In many cases, the accounting treatment of a particular
transaction is specifically dictated by accounting principles generally accepted
in the United States, with no need for management's judgment in their
application. The impact and any associated risks related to these policies on
the Company's business operations is discussed throughout Management's
Discussion and Analysis or plan of operations where such policies affect the
Company's reported and expected financial results. For a detailed discussion on
the application of these and other accounting policies, see the Notes to
Financial Statements. The Company's preparation of the financial statements
requires it to make estimates and assumptions that affect the reported amount of
assets and liabilities, disclosure of contingent assets and liabilities at the
date of the Company's financial statements, and the reported amounts of revenue
and expenses during the reporting period. There can be no assurance that actual
results will not differ from those estimates.

GOODWILL AND LONG-LIVED INTANGIBLE ASSETS.

     The carrying value of goodwill as well as other long-lived intangible
assets is reviewed if the facts and circumstances suggest that they may be
impaired. If this review indicates that the assets will not be recoverable over
the remaining amortization period, then the carrying values of the assets are
reduced to their estimated fair values. There was no impairment loss for the
year ending December 31, 2005.

                                       10
<PAGE>

PLAN OF OPERATION.

     Our primary focus over the course of the next 12 months will be to
concentrate on introducing our initial product into the commercial marketplace
including producing inventory for sale and establishing channels of distribution
for the marketing of our products. We expect to introduce a mustard-based yellow
barbeque sauce as our first product.

     We were recently formed and all activity to date has been related to our
formation of our business, formulation of our business plan and initial start-up
operations such as obtaining a recipe for our proposed initial product,
investigating sources of supply for product ingredients and packaging, reviewing
labeling and other regulatory requirements for our products, investigating
potential distribution channels for our products and development of our proposed
financing. Our ability to proceed with our plan to enter the commercial
marketplace with our initial product depends upon our obtaining adequate
financial resources through this offering. As of December 31, 2005, we had not
incurred any material costs or expenses other than those associated with the
formation of our company and initiation of our public offering.

     Management believes that we will require a minimum of $50,000 of available
capital to enter the marketplace with our initial product. If such capital does
not become available from the proceeds of this offering or such other sources we
will continue development stage operations for the next 12 months from available
cash on hand.

     If we succeed in introducing our first product into the marketplace we
anticipate that sales of our product will generate sufficient cash flow to
support our operations for the next twelve months. However, this is based on our
assumption of achieving significant sales of our product and there can be no
assurance that such sales levels will be achieved. Therefore, we may require
additional financing through factoring of accounts receivable, loans and other
arrangements, including the sale of additional common stock or preferred stock.

     There can be no assurance that such additional financing will be available,
or if available, can be obtained on satisfactory terms. To the extent that any
such financing involves the sale of our equity securities, the interests of our
then existing stockholders, including the investors in this offering, could be
substantially diluted. In the event that we do not have sufficient capital to
support our operations we may have to curtain our operations.

     Our officers will provide daily management of our company, including
marketing, administration, financial management, product development,
manufacture and sale of product. We will also engage other employees and service
organizations to provide needed services as the need for them arise. These could
include services such as computer systems, sales, marketing, advertising, public
relations, cash management, collections, accounting, and administration.

     We are subject to certain reporting and other compliance requirements of a
publicly reporting company. We will be subject to certain costs for such
compliance which private companies may not choose to make. We have identified
such costs as being primarily for audits, legal advice, filing expenses and
shareholder communications and estimate the cost to be approximately $10,000 to
$15,000 for the next twelve months. We expect to pay such costs from a
combination of cash on hand, the proceeds of our public offering which was
commenced on November 4, 2005 and cash generated by product sales.

     We expect our initial operating expenses will be paid for by utilization of
some of the proceeds of our public offering which was commenced on November 4,
2005 and from cash flows generated from product sales.

                                       11
<PAGE>

     There can be no assurance that we will be able to successfully introduce
our initial product or any other products into the commercial marketplace. We
believe that we can control the operating and general and administrative
expenses of our operations to be within the cash available from our public
offering which was commenced on November 4, 2005 and from the collections on the
product sales which we may make. If our initial operations indicate that our
business can establish and fulfill a demand for our initial product on a basis
which will lead to establishment of a profitable business we may seek additional
sources of cash to grow the business. We do not currently have any commitments
for the sale of our proposed products or for additional financing.

RISK FACTORS

     We are subject to a number of risks, some of which are discussed below.
Before deciding to invest in our company or to maintain or increase your
investment, you should carefully consider the risks described below, in addition
to the other information contained in this Annual Report on Form 10-KSB, our
Quarterly Reports on 10-QSB; and in our other filings with the Securities and
Exchange Commission, including any subsequent reports filed on Forms 10-KSB,
10-QSB and 8-K. The risks and uncertainties described below are not the only
ones that we face. Additional risks and uncertainties not presently known to us
or that we currently deem immaterial may also affect our business and results of
operations. If any of these risks actually occur, our business, financial
condition or results of operations could be seriously harmed.

BECAUSE WE WERE ORGANIZED IN DECEMBER 2004 AND HAVE NOT CONDUCTED OPERATIONS OF
OUR SPECIALTY FOOD BUSINESS BEYOND INITIAL START-UP OPERATIONS, OUR BUSINESS MAY
NOT BE SUCCESSFUL.

     Our company was incorporated in December 2004 and has only undertaken
activities related to its formation, initial planning of our business and
preparing for this offering. We have not begun to offer any products into the
marketplace. We have no history of operating such business upon which you can
rely in making an investment decision concerning this offering. Investing in a
business in the start-up phase is riskier than investing in a business that has
already begun selling products and has a history of operations.

OUR INDEPENDENT AUDITORS HAVE RAISED SUBSTANTIAL DOUBTS ABOUT OUR ABILITY TO
CONTINUE AS A GOING CONCERN.

     Our independent auditors have raised substantial doubts about our ability
to continue as a going concern in their report on our financial statements. If
we are unable to continue as going concern we would experience additional losses
from the write-down of assets.

BECAUSE WE MAY NOT BE SUCCESSFUL IN DEVELOPING OUR PROPOSED SPECIALTY FOOD
BUSINESS, THIS IS A RISKY INVESTMENT.

     The establishment of any new business is difficult and there can be no
assurance that we will be able to enter the commercial marketplace with products
or that any products we introduce will be a commercial success.

BECAUSE OUR PRODUCTS MAY NOT BE COMMERCIALLY SUCCESSFUL, WE MAY NOT BE ABLE TO
CONTINUE IN BUSINESS.

     In order to achieve profitable operations we are dependent upon market
acceptance of our products, substantial sales and the ability to produce and
distribute products at satisfactory cost levels, none of which can be assured.
We have not introduced our initial barbecue sauce product into the marketplace.

                                       12
<PAGE>

WE RELY ON A LICENSE FROM OUR CONTROLLING STOCKHOLDER FOR THE RECIPE FOR OUR
FIRST PRODUCT. OUR RIGHT TO USE SUCH RECIPE MAY BE TERMINATED UNDER CERTAIN
CIRCUMSTANCES AND THIS MAY RESULT IN A CONFLICT OF INTEREST, WHICH COULD BE
DETRIMENTAL TO US.

     Under the terms of the license of the recipe for our proposed first
product, the Licensor may cancel and terminate our use of the recipe in the
event we have not introduced a product into the commercial marketplace based on
the recipe and recognized revenues of $500,000 from such product by September
30, 2006. In the event we make an outright sale of the license or sub-license of
the recipe we are required to share in the proceeds equally (50/50 split) with
Mr. Jordan. Although we believe all transactions between Southern Sauce Company,
Inc. and Mr. Jordan have been and will be fair, the terms of the license
agreement may cause our business to be adversely affected.

     For example,

     Mr. Jordan could exercise his control to put himself in a position to
terminate the license and obtain the rights to the recipe or influence the terms
of an acquisition of the company to obtain a 50% share of the proceeds.

WE NEED ADDITIONAL CAPITAL TO ENABLE US TO INTRODUCE OUR FIRST PRODUCT INTO THE
MARKETPLACE, WHICH MEANS WE MAY NOT BE ABLE TO CONTINUE OPERATING OUR BUSINESS.

     Management believes that we will require a minimum of $50,000 of available
capital to enter the marketplace with our initial product. If such capital does
not become available we will continue development stage operations from
available cash on hand. We have no current arrangements with respect to, or
sources of any additional capital, and there can be no assurance that such
additional capital will be available to us when needed. If we are unable to
obtain additional capital this would have a material adverse effect on us and
would cause us to be unable to enter the marketplace with our first product. To
the extent that any such financing involves the sale of our equity securities,
the interests of our then existing stockholders, including the investors in this
offering, could be substantially diluted. In the event that we do not have
sufficient capital to support our operations we may have to curtain our
operations.

OUR OFFICERS AND DIRECTORS HAVE NO EXPERIENCE IN THE SPECIALTY FOOD BUSINESS OR
MANAGING PUBLIC COMPANIES, MAKING IT LESS LIKELY THAT OUR BUSINESS WILL BE
SUCCESSFUL.

     None of our officers and directors has any background or experience in the
specialty food business or managing public companies. Investing in a business
which is run by persons who have no experience in the industry in which it will
operate is riskier than investing in a business that has a management team with
experience in its industry. Investing in a public company which is run by
persons who have no experience in operating public companies is riskier than
investing in a business that has a management team with experience in the
operation of public companies.

WE HAVE NO FULL TIME EMPLOYEES AND OUR OFFICERS ONLY WORK FOR US ON AN "AS
NEEDED" BASIS, WHICH MEANS OUR MANAGEMENT MAY BE INADEQUATE TO OPERATE OUR
BUSINESS.

     We do not currently employ any full-time employees. All of our activities
to date have been undertaken by our officers who only devote approximately 5% of
their time to operating our business as needed. We cannot assure you that our
management will be able to devote sufficient time to our business in the future
or that we will be able to hire employees when needed to support our entry into
the specialty food business.

                                       13
<PAGE>

LIQUIDITY AND CAPITAL RESOURCES

     During the twelve months ended December 31, 2005, working capital increased
$21,068 to $26,068 from $5,000. The primary reasons for the increase is an
increase in cash of $21,742,offset by increase in accounts payable of $674.
During this same period, stockholders' equity increased $20,754 to $27,324 from
$6,570. The increase in stockholders' equity is primarily due to the common
stock issued for cash of $36,000 and preferred stock issued for cash of $32,550
offset by the net loss for the year of ($47,796).

     There are no assurances that the Company will be successful in achieving
the above plans, or that such plans, if consummated, will enable the Company to
obtain profitable operations or continue as a going concern.

ITEM 7.   CONSOLIDATED FINANCIAL STATEMENTS


                          SOUTHERN SAUCE COMPANY, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                              FINANCIAL STATEMENTS

                                TABLE OF CONTENTS


Report of Independent Registered Public Accounting Firm...............        15

Financial Statements:

     Balance Sheet as of December 31, 2005............................        16

     Statements of Operations for the year ended December 31, 2005,
     for the period from December 1, 2004 (inception) through
     December 31, 2004, and for the period from December 1, 2004
     (inception) through December 31, 2005............................        17

     Statement of Stockholders' equity for the year ended
     December 31, 2005................................................        18

     Statements of Cash Flows for the year ended December 31, 2005,
     for the period from December 1, 2004 (inception) through
     December 31, 2004, and for the period from December 1, 2004
     (inception) through December 31, 2005............................        19


Notes to Financial Statements.........................................   20 - 25


                                       14
<PAGE>

             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors
Southern Sauce, Inc
Morriston, Florida

We have audited the accompanying balance sheet of Southern Sauce, Inc. (a
development stage company) as of December 31, 2005, and the related statements
of operations, stockholders' equity and cash flows for the year ended December
31, 2005, the period ended December 1, 2004 (inception) to December 31, 2004,
and, the period from December 1, 2004 (inception) to December 31, 2005. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on the financial statement based on our
audits.

We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining on a
test basis, evidence supporting the amount and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Southern Sauce, Inc. as of
December 31, 2005, and the results of their operations and their cash flows for
the year ended December 31, 2005, the period ended December 1, 2004 (inception)
to December 31, 2004, and, the period from December 1, 2004 (inception) to
December 31, 2005, in conformity with accounting principles generally accepted
in the United States of America.

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 9 to the
financial statements, the Company has a stockholder's deficit of $51,809 at
December 31, 2005, and had net a loss and cash used in operations of $47,796 and
$46,808, respectively, in 2005. This raises substantial doubt about its ability
to continue as a going concern. Management's plans in regards to these matters
are also described in Note 9. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty.


                                       /s/Sherb & Co., LLP
                                       Certified Public Accountants

Boca Raton, Florida
January 30, 2006

                                       15
<PAGE>

SOUTHERN SAUCE COMPANY, INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET
DECEMBER 31, 2005
================================================================================


                                     ASSETS
                                     ------

                                December 31, 2005

Current assets:
  Cash .............................................................   $ 26,742
                                                                       --------
  Total current assets .............................................     26,742

  License, net .....................................................      1,256
                                                                       --------
     Total assets ..................................................   $ 27,998
                                                                       ========

                      LIABILITIES AND STOCKHOLDERS' EQUITY
                      ------------------------------------

Current Liabilities:
  Accounts Payable .................................................   $    674
                                                                       --------
  Total current liabilities ........................................        674

Commitments and Contingencies

Stockholders' equity:
  Series A Convertible Preferred stock, 15,000,000 authorized;
   par value $.001; 3,255 issued and outstanding ...................          3

  Common stock, 100,000,000 authorized, $.001 par value;
   2,500,000 issued and outstanding ................................      2,500
  Additional paid in capital .......................................     76,630
  Deficit accumulated during the development stage .................    (51,809)
                                                                       --------

     Total stockholders' equity ....................................     27,324
                                                                       --------

     Total liabilities and stockholders' equity ....................   $ 27,998
                                                                       ========

                 See accompanying notes to financial statements

                                       16
<PAGE>
<TABLE>
SOUTHERN SAUCE COMPANY, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS
YEAR ENDED DECEMBER 31, 2005, FOR THE PERIOD FROM DECEMBER 1, 2004 (INCEPTION)
THROUGH DECEMBER 31, 2004, AND THE PERIOD FROM DECEMBER 1, 2004 (INCEPTION)
THROUGH DECEMBER 31, 2005
========================================================================================================
<CAPTION>

                                                                 DECEMBER 1, 2004      DECEMBER 1, 2004
                                                                    (INCEPTION)           (INCEPTION)
                                                  YEAR ENDED          THROUGH              THROUGH
                                                     2005        DECEMBER 31, 2004     DECEMBER 31, 2005
                                                 -----------     -----------------     -----------------
<S>                                              <C>                <C>                   <C>
Revenue ....................................     $         -        $         -           $         -

Selling, general and administrative expenses          47,830              4,013           $    51,843
                                                 -----------        -----------           -----------

Loss from operations .......................         (47,830)            (4,013)          $   (51,843)
                                                 -----------        -----------           -----------
Interest income ............................              34                  -                    34
Provision (benefit) for income taxes .......               -                  -                     -
                                                 -----------        -----------           -----------

Net loss ...................................     $   (47,796)       $    (4,013)          $   (51,809)
                                                 ===========        ===========           ===========

Basic and diluted loss per common share ....           (0.02)             (0.00)                (0.02)
                                                 ===========        ===========           ===========

Basic and diluted weighted average common
  shares outstanding during the period .....       2,342,192          1,125,806             2,285,823
                                                 ===========        ===========           ===========


                              See accompanying notes to financial statements

                                                     17
</TABLE>
<PAGE>
<TABLE>
SOUTHERN SAUCE COMPANY, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
========================================================================================================
<CAPTION>

                                                                                   Deficit
                                                                                 Accumulated
                                                                    Additional   during the
                           Common       Par     Preferred    Par     Paid in     Development
                           Stock       Value      Stock     Value    Capital        Stage        Total
                          ---------    ------   ---------   -----   ----------   -----------   --------
<S>                       <C>          <C>        <C>        <C>     <C>          <C>          <C>
Balance,
December 1, 2004
(Inception) ...........           -    $    0         -      $ -     $     -      $      -     $      -

Common Stock
issued for cash .......     610,000       610         -        -       4,390             -        5,000

Common Stock
issued for license ....     500,000       500         -        -       1,070             -        1,570

Common Stock
issued for services ...     490,000       490         -        -       3,523             -        4,013

Net (loss),
December 31, 2004 .....           -         -         -        -           -        (4,013)      (4,013)
                          ---------    ------     -----      ---     -------      --------     --------
Balance,
December 31, 2004 .....   1,600,000    $1,600         -        -     $ 8,983      $ (4,013)    $  6,570

Common Stock
issued for cash .......     900,000       900         -        -      35,100             -       36,000

Preferred Stock
issued for cash .......           -         -     3,255        3      32,547             -       32,550

Net (loss),
December 31, 2005 .....           -         -         -        -           -       (47,796)     (47,796)
                          ---------    ------     -----      ---     -------      --------     --------
Balance,
December 31, 2005 .....   2,500,000    $2,500     3,255      $ 3     $76,630      $(51,809)    $ 27,324
                          =========    ======     =====      ===     =======      ========     ========

                              See accompanying notes to financial statements

                                                     18
</TABLE>
<PAGE>
<TABLE>
SOUTHERN SAUCE COMPANY, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOWS
========================================================================================================
<CAPTION>

                                                                     PERIOD FROM          PERIOD FROM
                                                                  DECEMBER 1, 2004     DECEMBER 1, 2004
                                                                     (INCEPTION)          (INCEPTION)
                                                YEAR ENDED             THROUGH              THROUGH
                                            DECEMBER 31, 2005     DECEMBER 31, 2004    DECEMBER 31, 2005
                                           -------------------    -----------------    -----------------
<S>                                             <C>                 <C>                    <C>
Cash flows from operating activities:
  Net loss ................................     $(47,796)           $ (4,013)              $(51,809)
  Amortization expense ....................          314                   -                    314
  Issuance of common stock for services ...            -               4,013                  4,013
  Accounts payable.........................          674                   -                    674
                                                --------            --------               --------
Net cash used in operating activities .....      (46,808)                  -                (46,808)
                                                --------            --------               --------

Cash flows from investing activities ......            -                   -                      -

Cash flows from financing activities:
  Common stock issued for cash ............       36,000               5,000                 41,000
  Preferred stock issued for cash..........       32,550                   -                 32,550
                                                --------            --------               --------
Net cash provided by financing activities .       68,550               5,000                 73,550
                                                --------            --------               --------

Net increase in cash ......................       21,742               5,000                 26,742
                                                --------            --------               --------

Cash at beginning of period ...............        5,000                   -                      -
                                                --------            --------               --------

Cash at end of period .....................     $ 26,742            $  5,000               $ 26,742
                                                ========            ========               ========
Supplementary information:
--------------------------
  Cash paid for:
    Interest ..............................     $      -            $      -               $      -
                                                ========            ========               ========
    Income taxes ..........................     $      -            $      -               $      -
                                                ========            ========               ========

Non cash transactions affecting financing
  and investing activities:
    Issuance of common stock for license ..     $      -            $  1,570               $  1,570
                                                ========            ========               ========


                              See accompanying notes to financial statements

                                                     19
</TABLE>
<PAGE>

                          SOUTHERN SAUCE COMPANY, INC.
                          (A DEVELOPMENT STAGE COMPANY)
                          NOTES TO FINANCIAL STATEMENTS


NOTE 1 - DESCRIPTION OF BUSINESS AND DEVELOPMENT STAGE RISK
-----------------------------------------------------------

Southern Sauce Company, Inc. was formed to make and sell specialty food
products. It is seeking to introduce its first product, a barbecue sauce, into
the commercial marketplace.

The Company has no revenues to date. During the development stage and since its
inception, the Company has been dependent upon the receipt of capital investment
to fund its continuing activities. In addition to the normal risks associated
with a new business venture, there can be no assurance that the Company's
business plan will be successfully executed. Our ability to execute our business
model will depend on our ability to obtain additional financing and achieve a
profitable level of operations. There can be no assurance that sufficient
financing will be obtained. Nor can we give any assurance that we will generate
substantial revenues or that our business operations will prove to be
profitable.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
---------------------------------------------------

CASH AND CASH EQUIVALENTS

The Company considers all highly liquid debt instruments with original
maturities of three months or less to be cash equivalents. The Company has no
cash equivalents.

USE OF ESTIMATES

The preparation of financial statements in conformity with general accepted
accounting principles requires management to make estimates and assumptions that
affect certain reported amounts and disclosures. Accordingly, actual results
could differ from those estimates.

REVENUE RECOGNITION

The Company will recognize revenue when:

     o Persuasive evidence of an arrangement exists;

     o Shipment has occurred;

     o Price is fixed or determinable; and

     o Collectability is reasonably assured

The Company will closely follow the provisions of Staff Accounting Bulletin No.
104 as described above. For the years ended December 31, 2005 and 2004 and for
the period from December 1, 2004 (inception) to December 31, 2005, the Company
has recognized no revenues.

                                       20
<PAGE>

                          SOUTHERN SAUCE COMPANY, INC.
                          (A DEVELOPMENT STAGE COMPANY)
                          NOTES TO FINANCIAL STATEMENTS


EARNINGS (LOSS) PER SHARE

The financial statements are presented in accordance with Statement of Financial
Accounting Standards No. 128 ("SFAS 128"), "Earnings Per Share". Basic earnings
per share is computed using the weighted average number of common shares
outstanding during the period. Diluted earnings per share reflect the potential
dilution from the exercise or conversion of securities into common stock.

INTANGIBLE ASSETS

Intangible assets consist of license agreements which are recorded at cost and
amortized over a straight-line basis. The amortization expense for the years
ended December 31, 2005 and 2004 was $314 and $0 respectively.

The Company evaluates the recoverability of identifiable intangible assets
whenever events or changes in circumstances indicate that an intangible asset's
carrying amount may not be recoverable. There was no impairment loss for the
year ending December 31, 2005.

NOTE 3 - EQUITY TRANSACTIONS
----------------------------

During the year ended December 31, 2004, the Company issued 610,000 shares of
common stock to an initial investor for cash of $5,000.

During the year ended December 31, 2004, the Company issued 500,000 shares of
common stock for the purchase of the license to distribute its initial product
from the majority shareholder. The value of the license was determined to be the
legal costs to create the license, which was $1,570.

During the year ended December 31, 2004, the Company issued 490,000 shares of
common stock for services rendered at a value of $4,013. The Company issued
122,500 shares each of these shares to two members of the board of directors for
their service as directors of the Company valued at $1,003 each , and 122,500
shares to the Company's attorney for legal services valued at $1,003.

During the year ended December 31, 2005, the Company issued 900,000 shares of
common stock at $.04 per share, for a total of $36,000.

During the year ended December 31, 2005, the Company issued 3,255 shares of
Series A convertible preferred stock at $10.00 per share, for a total of
$32,550.

Subsequent to year end, the Company issued 300 shares of Series A convertible
preferred stock at $10.00 per share, for a total of $3,000. The Company also
issued 25,000 shares of common stock each to Messrs. Kumar, Rowley and Bova in
consideration of their serving as directors of the Company valued at $2,500 ,
the FMV at the date of issuance.

NOTE 4 - INCOME TAXES
---------------------

As of December 31, 2005 the Company had unused net operating loss carry forward
of approximately $52,000 available for use on its future corporate tax returns.

For income tax purposes, the Company has elected to capitalize start-up costs
incurred during the period ended December 31, 2005 totaling $51,809. The
start-up costs will be amortized over sixty months beginning in the year of
initial operations.

                                       21
<PAGE>

                          SOUTHERN SAUCE COMPANY, INC.
                          (A DEVELOPMENT STAGE COMPANY)
                          NOTES TO FINANCIAL STATEMENTS


The provision for income taxes for the years ended December 31, consists of the
following components:

                                                            2005         2004
                                                            ----         ----
Continuing operations
   Federal:
      Current ........................................    $      -     $      -
      Deferred .......................................           -            -
                                                          --------     --------
                                                          $      -     $      -
                                                          ========     ========


Reconciliation of the Federal Statutory Income Tax rate to the Company's
effective income tax rate is as follows:

                                                            2005         2004
                                                            ----         ----

Computed at the Statutary rates (34%) ................    $(16,262)    $      -
Non deductible expenses ..............................         246            -
State income taxes (net of federal tax benefit) ......      (1,710)           -
Change in valuation Allowance ........................      17,726            -
                                                          --------     --------
Tax provision (benefit) ..............................    $      -      $     -
                                                          ========     ========


The significant temporary differences that give rise to a deferred tax asset as
of December 31, 2005 and 2004 are as follows:

                                                            2005         2004
                                                            ----         ----
Deferred tax asset:
NOL Carryforward .....................................    $ 17,726     $      -
                                                          --------     --------
   Total deferred tax asset ..........................      17,726            -
      Less valuation allowance .......................     (17,726)           -
                                                          --------     --------
   Net deferred tax asset ............................    $      -     $      -
                                                          ========     ========

The net change in the total valuation allowance for the year ended December 31,
2005 was an increase of $17,726.

Net operating loss carry forward expires between 2024 and 2025. The utilization
of the above loss carry forwards , for federal income tax purposes may be
subject to limitations resulting from changes in ownership.

In assessing the reliability of deferred tax assets, management considers
whether it is more likely than not that some portion or all of the deferred tax
assets will not be realized. The ultimate realization of deferred tax assets is
dependent upon the generation of future taxable income during the periods in
which those temporary differences become deductible. Management considers
projected future taxable income and tax planning strategies in making this
assessment.

                                       22
<PAGE>

                          SOUTHERN SAUCE COMPANY, INC.
                          (A DEVELOPMENT STAGE COMPANY)
                          NOTES TO FINANCIAL STATEMENTS


NOTE 5 - STOCKHOLDER LOAN
-------------------------

On March 31, 2005, $920 was paid for Company expenses by one of the
stockholders. The amount is non-interest bearing, unsecured and due within 12
months. In the month of April 2005, the Company repaid this balance owed to the
shareholder.

NOTE 6 - RECENT ACCOUNTING PRONOUNCEMENTS
-----------------------------------------

In November 2004, the FASB issued SFAS 151, Inventory Costs--an amendment of ARB
No. 43, Chapter 4. The Statement amends the guidance of ARB No. 43, Chapter 4,
Inventory Pricing , by clarifying that abnormal amounts of idle facility
expense, freight, handling costs, and wasted materials (spoilage) should be
recognized as current-period charges and by requiring the allocation of fixed
production overheads to inventory based on the normal capacity of the production
facilities. It does not appear that this Statement will have a material effect
on the financial position, operations or cash flows of the Company when it
becomes effective in 2006.

In December 2004, the FASB issued SFAS No. 123R "Share-Based Payment" ("SFAS
123R"), a revision to SFAS No. 123 "Accounting for Stock-Based Compensation"
("SFAS 123"), and superseding APB Opinion No. 25 "Accounting for Stock Issued to
Employees" and its related implementation guidance. SFAS 123R establishes
standards for the accounting for transactions in which an entity exchanges its
equity instruments for goods or services, including obtaining employee services
in share-based payment transactions. SFAS 123R applies to all awards granted
after the required effective date and to awards modified, repurchased, or
cancelled after that date. Adoption of the provisions of SFAS 123R is effective
as of the beginning of the first interim or annual reporting period that begins
after June 15, 2005. The Company does not believe the adoption of SFAS 123 will
have a material effect on the financial position, results of operations or cash
flow.

SFAS No. 154, Accounting Changes and Error Corrections, was issued in May 2005
and replaces APB Opinion No. 20 and SFAS No. 3. SFAS No. 154 requires
retrospective application for voluntary changes in accounting principle in most
instances and is required to be applied to all accounting changes made in fiscal
years beginning after December 15, 2005. The Company's expected April 1, 2006
adoption of SFAS No. 154 is not expected to have a material impact on the
Company's consolidated financial condition or results of operations

NOTE 7 - CONCENTRATION OF CREDIT RISK
-------------------------------------

Financial instruments that potentially subject the Company to concentrations of
credit risk consist principally of cash deposits. Accounts at each institution
are insured by the Federal Deposit Insurance Corporation (FDIC) up to $100,000.
At December 31, 2005 and 2004, the Company had no amounts in excess of FDIC
insured limit.

NOTE 8 - NET LOSS PER SHARE
---------------------------

The Company's basic and diluted net loss per share amounts have been computed by
dividing the results by the weighted average number of outstanding common
shares. For the periods ended December 31, 2005 and 2004, the Company reported a
net loss, therefore no common shares equivalent were included in diluted net
loss per common share because the affect would be anti-dilutive.

                                       23
<PAGE>

                          SOUTHERN SAUCE COMPANY, INC.
                          (A DEVELOPMENT STAGE COMPANY)
                          NOTES TO FINANCIAL STATEMENTS


The following reconciles amounts reported in the financial statements:
<TABLE>
<CAPTION>
                                                               December 11, 2004     December1, 2004
                                           Year ended          (Inception) through   (Inception) through
                                           December 31, 2005   December 31, 2004     December 31, 2005
                                           -----------------   -------------------   -------------------
<S>                                           <C>                  <C>                   <C>
Net loss                                      $ (47,796)           $  (4,013)            $ (51,809)
                                              =========            =========             =========

Denominator for basic loss per share -
Weighted average shares ...................   2,342,192            1,125,806             2,285,823

Denominator for diluted loss per share -
Basic and diluted loss per common share ...   $    (.02)           $    (.00)            $    (.02)
                                              =========            =========             =========
</TABLE>

NOTE 9 - GOING CONCERN
----------------------

As reflected in the accompanying financial statements, the Company has a net
loss of $47,796 and net cash used in operations of $46,808, and a deficit
accumulated during the development stage of $51,809. At December 31, 2005, the
Company has no operating revenues. The ability of the Company to continue as a
going concern is dependent on the Company's ability to further implement its
business plan and raise capital The financial statements do not include any
adjustments that might be necessary if the Company is unable to continue as a
going concern.

The Company is currently a development stage company and its continued existence
is dependent upon the Company's ability to resolve its liquidity problems,
principally by obtaining additional debt financing and/or equity capital. The
Company has yet to generate an internal cash flow, and until licensing or sales
of pharmaceuticals products commence, the Company is highly dependent upon debt
and equity funding , should continuing debt and equity funding requirements not
be met the Company's operations may cease to exist.

NOTE 10 - LICENSE AGREEMENT
---------------------------

On December 1, 2004, the Company entered into a license agreement for the
exclusive worldwide license of the recipe for its initial product. The license
will be amortized over five years using the straight line method. The licensor
may cancel and terminate the license in the event the Company has not introduced
one or more products into the commercial market place based on the recipe and
recognized revenue of $500,000 from sales of the product by September 30, 2006.

The estimated amortization expense over the next five years is as follows:

                             YEAR ENDING DECEMBER 31
                             -----------------------

                             2006             $  314
                             2007                314
                             2008                314
                             2009                314
                                              ------
                                              $1,256

                                       24
<PAGE>

                          SOUTHERN SAUCE COMPANY, INC.
                          (A DEVELOPMENT STAGE COMPANY)
                          NOTES TO FINANCIAL STATEMENTS


NOTE 11 - SUBSEQUENT EVENTS
---------------------------

The Company's initial public offering was commenced on November 4, 2005, As of
February 10, 2006 the Company has sold an additional 300 shares of Series A
Convertible Preferred Stock for the aggregate price of $3,000. The Company also
issued 25,000 shares of common stock each to Messrs. Kumar, Rowley and Bova in
consideration of their serving as directors of the Company valued at $2,500 ,
the FMV at the date of issuance.

                                       25
<PAGE>

ITEM 8.   CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
          FINANCIAL DISCLOSURE.

     (a) On November 16, 2005, Southern Sauce Company, Inc. (the "Company")
dismissed Daszkal Bolton LLP as the Company's independent registered public
accounting firm. The decision to change the Company's independent registered
public accounting firm was approved by the Company's Board of Directors.

     (b) During the fiscal year ended December 31, 2004 and the interim period
through November 16, 2005, there were no disagreements with Daszkal Bolton LLP
on any matter of accounting principles or practices, financial statement
disclosure, or accounting scope or procedure, which disagreements, if not
resolved to the satisfaction of Daszkal Bolton LLP, would have caused Daszkal
Bolton LLP to make reference thereto in its reports on the financial statements
for such years.

     (c) During the fiscal year ended December 31, 2004 and the interim period
through November 16, 2005, there were no reportable events.

     (d) The report of Daszkal Bolton LLP on the Company's financial statements
as of and for the fiscal year ended December 31, 2004 contained no adverse
opinion or disclaimer of opinion and were not qualified or modified as to
uncertainty, audit scope, or accounting principle, other than uncertainty as to
the Company's ability to continue as a going concern.

     (e) We have requested that Daszkal Bolton LLP furnish a letter addressed to
the Securities and Exchange Commission (the "SEC") stating whether Daszkal
Bolton LLP agrees with the above statements made by us. A copy of this letter
addressed to the Securities and Exchange Commission, dated November 21, 2005, is
filed as Exhibit 16 to our Current Report on Form 8-K filed November 22, 2005.

     (f) On November 21, 2005, the Company engaged Sherb & Co., LLP, as its new
independent registered public accounting firm. The Company has not consulted
with Sherb & Co., LLP during the fiscal year ended December 31, 2004 and through
November 16, 2005, on either the application of accounting principles or type of
opinion Sherb & Co., LLP might issue on the Company's financial statements.

ITEM 8A.  CONTROLS AND PROCEDURES.

     An evaluation was carried out under the supervision and with the
participation of our management, including our Chief Executive Officer ("CEO")
and Chief Financial Officer ("CFO"), of the effectiveness of our disclosure
controls and procedures as of December 31, 2005. Disclosure controls and
procedures are procedures that are designed with the objective of ensuring that
information required to be disclosed in our reports filed under the Securities
Exchange Act of 1934, such as this Form 10-KSB, is recorded, processed,
summarized and reported within the time periods specified in the Securities and
Exchange Commission's rules and forms. Based on that evaluation, our CEO and CFO
have concluded that our disclosure controls and procedures are effective to
satisfy the objectives for which they are intended. Subsequent to the date of
our management's evaluation, there were no significant changes in our internal
controls or in other factors that could significantly affect these controls,
including any corrective actions with regard to significant deficiencies and
material weaknesses.

ITEM 8B.  OTHER INFORMATION.

     None.

                                       26
<PAGE>

                                    PART III

ITEM 9.   DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
          COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT.

Our directors and executive officers are:

     Name                   Age     Position
     ----                   ---     --------

     Robert E. Jordan       50      President, Chief Executive Officer, director

     Francis A. Rebello     55      Treasurer, Secretary, director

     Anand Kumar            61      Director

     Todd W. Rowley         47      Director

     Bob Bova               46      Director

     ROBERT E. JORDAN has been our President, Chief Executive Officer and a
director since December 2004. Mr. Jordan has been retired from practicing law
for over five years. He is a member of the Florida Bar. In 1999 Mr. Jordan filed
for personal bankruptcy under Chapter 13 due to his inability to meet his
financial obligations due to an illness. He was discharged from bankruptcy in
January 2004.

     FRANCIS A. REBELLO has been our Treasurer, Secretary and a director since
December 2004. Mr. Rebello has been a project manager for the Satilla Regional
Cancer Treatment Center, Waycross, Georgia since November 2002. From November
1984 to January 2002 Mr. Rebello was employed by American Express Company as an
instructional designer. Mr. Rebello attended school between January 2002 and
November 2002.

     ANAND KUMAR was elected as a director in February 2006. He has been
Executive Vice President of Ariel Way, Inc. since February 2, 2005 and was a
director and Executive Vice President of an Ariel Way predecessor since August
10, 2004. During Mr. Kumar's professional career, spanning almost 35 years, he
founded and operated a number of companies including the founding in 1992 of an
international consulting company, Communications Strategies Group, advising
foreign telecommunications administrations such as among others Iceland Telecom,
Andorra Telecom, Cyprus Telecom, Bangladesh Telecom Board and U.S. domestic
carriers including Cable & Wireless, Comsat RSI, AT&T, Sprint, MCI, Startec
Global Communications and various others. During this period Mr. Kumar also
helped build a European based telecommunications carrier, Esprit Telecom, later
acquired by Global TeleSystems, and an international satellite teleport,
Satellite Media Services, operating in the U.K. Prior to 2000 Mr. Kumar in
January 1999, Mr. Kumar established Global TeleSolutions, Inc. for the
origination and termination of multiple types of international telephony and
data traffic. Prior to this, Mr. Kumar co-founded and participated in building
the international operating locations for an international telecommunications
carrier, Facilicom International, Inc. in Washington, D.C. In addition to
establishing multiple gateway telecommunications switch locations and offices in
more than 12 foreign locations, Mr. Kumar was also part of the raising of $300
million in high-yield debt financing. In 1986, Mr. Kumar co-founded and served
as the President until 1992 of Washington International Teleport, WIT, an
international satellite teleport in Alexandria, Virginia. WIT evolved to operate
30 large satellite antennas for multiple satellites for a diverse group of
customers from MCI to CNN. It was built to offer both back haul services on
optical fiber and microwave connections and diverse types of satellite based
services for full time and ad-hoc users. Previous to these activities Mr. Kumar
was also for a number of years in various managerial capacities within the Bell
operating company environment, such as Bell Canada, Bell Northern Research, and
AT&T. Mr. Kumar is trained as an Electrical Engineer both at the undergraduate
and graduate levels in the U.S. and was a doctorate candidate in communications
studying under the guidance of professors from MIT.

                                       27
<PAGE>

     TODD W. ROWLEY was elected as a director in 2006. Mr. Rowley has worked for
the Wachovia Corporation since 1987 having begun his career at First Virginia
Bank in 1980. His most recent role is as a Senior Vice President and Senior
Relationship Manager in the Metropolitan Washington region's Commercial Banking
Division. Prior to that, Mr. Rowley served as a Portfolio Partner in First
Union's Strategic Ventures Group that was responsible for the overall management
of the institution's strategic investment portfolio; the Wachovia Corporation
has since acquired First Union Bank. Mr. Rowley has earned national recognition
for his work in support of small and minority businesses and regional economic
development, by having been named the U.S. Small Business Administration's
Financial Services Advocate of the Year for both 1993 and 1996. He was also
recognized by Fairfax County, Northern VA, as its Small Business Advocate of the
Year in 1992 and 1995. His financial support of small businesses that seek to
complete exporting transactions has also earned him Preferred and Level A
lending status from the Export-Import Bank of the United States. This
designation is awarded to less than 0.1 percent of all U.S. export lenders. A
native of southeastern Michigan, Mr. Rowley has lived and worked in the
Metropolitan Washington, D.C. region for over 22 years. He holds a bachelors
degree in business administration and speech communications from Adrian College,
a graduate degree in banking finance from the Stonier Graduate School of Banking
at the University of Delaware and a Master of Business Administration degree
with honors from Virginia Polytechnic Institute's R.B. Pamplin College of
Business. Mr. Rowley serves on the advisory boards of Virginia Polytechnic
Institute, "Virginia Tech", George Mason University, and the Metropolitan
Washington Regional Information/High Technology Project. Mr. Rowley also serves
on the board of directors for the Northern Virginia Technology Council, the
National Association of Workforce Boards, the Boy Scouts of America, the
Northern Virginia Workforce Investment Board, Leadership Fairfax Inc., REGION,
the Metropolitan Washington Alzheimer's Association, the National Kidney
Foundation - Capital Area, the Northern Virginia Community College Education
Foundation, and the Fairfax County Superintendent's Advisory Board; and is an
active member of Leadership Charlotte.

     BOB BOVA was elected as a director in February 2006. Mr. Bova is President
& CEO of Enfotec, Inc. Mr. Bova, who has over 20 years' experience in the
Information Technology field, works with the engineering team to provide the
open systems vision of Enfotec for the future of securing corporate data.
Delivering on introducing new technology to the market, Mr. Bova is recognized
in the Venture Capital, Entrepreneurial and Analyst communities in Southern
California as a resource for emerging technologies and their companies and helps
them evaluate their potential. As a previous Director at U.S. Bank/Oliver Allen
Corp., Mr. Bova started the Secure Networking Division and grew it to over $12
million in revenues within two years. He developed a worldwide scope of business
and services by partnering with companies such as IBM, Memorex/Telex, HP and
others. In 1997, Mr. Bova left U.S. Bank/Oliver Allen Corp. to start the ISG
division, SSL Technology, at Rainbow Technologies and grew that from $0 to $37
million in revenues in just under three years. Key development relationships
here included Intel, Sun Microsystems, HP, Dell, F5 and Nortel. As the Executive
Vice President of Asita Technologies, Mr. Bova was responsible for developing
the sales, marketing, administration, support, and finance infrastructures as
well as raising $24 million in funding for the organization. In addition to
developing and staffing Asita Technologies' worldwide headquarters in Irvine,
California, he established the organization in the Pacific Rim, Europe and North
America. In the local community of Southern California, Mr. Bova has received
special commendation awards from Concept 7 Foster Family Agency, The Red Cloud
Indian Society as well as captaining the local Neighborhood Watch organization
in partnership with the Irvine Police Department. Mr. Bova holds an MBA in
Marketing from National University and an Undergraduate degree from Syracuse
University.

     Our directors are elected yearly and hold office until the next annual
meeting of shareholders and the election and qualification of their successors.

                                       28
<PAGE>

     Our officers are elected annually by the board of directors and may be
replaced or removed by the board at any time. Our directors are elected by our
shareholders annually and serve until the election and qualification of their
successors or their earlier resignation or removal.

BOARD OF DIRECTOR COMMITTEES

     Our board of directors also serves as our audit committee. We do not have
any executive, compensation or any other committee of our board of directors.

DIRECTOR COMPENSATION

     We issued 122,500 shares of our common stock to each of Messrs. Jordan and
Robello and 25,000 shares each to Messrs. Kumar, Rowley and Bova in
consideration of their serving as directors. We do not have any other
arrangements for compensating our directors.

COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT.

     Our management and stockholders were not required to make filings pursuant
to Section 16(a) of the Exchange Act during the fiscal year ended December 31,
2005.

CODE OF ETHICS.

     We have adopted a Code of Ethics and have attached a copy as Exhibit 14 to
this Annual Report on Form 10-KSB.

ITEM 10.  EXECUTIVE COMPENSATION.

                           SUMMARY COMPENSATION TABLE

     The table below sets forth information relating to the compensation paid by
us during the fiscal years ended December 31, 2004 and 2005, our only completed
fiscal years since our organization, to our president and Chief Executive
Officer. None of our executive officers received executive compensation in such
years.

Name and                                                            Other Annual
Principal Position           Year        Salary        Bonus        Compensation
------------------           ----        ------        -----        ------------

Robert E. Jordan             2004         -0-           -0-             -0-
President and CEO            2005         -0-           -0-             -0-

STOCK OPTION PLANS.

     We have not granted any stock options or stock appreciation rights.
Accordingly, no tables relating to such items have been included within this
Item.

TERMINATION OF EMPLOYMENT AND CHANGE OF CONTROL ARRANGEMENT.

     There are no compensatory plans or arrangements, including payments to be
received from our Company, with respect to any person named in the Summary
Compensation Table set out above which would in any way result in payments to
any such person because of his or her resignation, retirement or other
termination of such person's employment with our Company or its subsidiaries, or
any change in control of our Company, or a change in the person's
responsibilities following a change in control of our Company.

                                       29
<PAGE>

ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

     The following table sets forth, as of February 10, 2006, the beneficial
ownership of our 2,930,500 outstanding shares of Common Stock by (1) the only
persons who own of record or are known to own beneficially, more than 5% of our
Common Stock; (2) each director and executive officer; and (3) all directors and
officers as a group.

                                          Shares Beneficially Owned
                                    ------------------------------------
Name                                Common Stock              Percentage
----                                ------------              ----------

Robert E. Jordan                        122,500                  4.2 %
Francis A. Rebello                      122,500                  4.2 %
David E. Jordan                       1,110,000                 37.9 %
Anand Kumar                              25,000                   *
Todd W. Rowley                           25,000                   *
Bob Bova                                 25,000                   *
                                      ---------                 ------
All directors and officers
 as a group 5 persons)                  320,000                 10.9 %
__________
* less than 1%

The address of David E. Jordan is 333 North Ocean Blvd., Deerfield Beach,
Florida 33441.

PROMOTERS

     We were founded in December 2004. David E. Jordan and Robert E. Jordan were
instrumental in our organization and may be considered promoters of our company.
They received no consideration for their services in connection with our
organization, but David E. Jordan received 500,000 shares of common stock for
licensing a barbecue sauce to us and Robert E. Jordan received 122,500 shares of
common stock for serving as a director until the next annual meeting of
shareholders. David E. Jordan also purchased 610,000 shares of our common stock
for $5,000 in December 2004.

ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

     We have an exclusive worldwide license agreement with David E. Jordan, a
shareholder and father of our president, allowing us to use a recipe developed
by Mr. Jordan for our initial yellow, mustard-based barbecue sauce. Under the
license agreement, we have the exclusive right to use the recipe related
know-how of Mr. Jordan. We issued Mr. Jordan 500,000 shares of our common stock
as consideration for the license. We agreed to exercise our best efforts,
consistent with good business practice, to undertake and maintain the commercial
scale production, marketing and distribution of products embodying the subject
matter of the recipe. Mr. Jordan may cancel and terminate the license in the
event that we have not introduced a product into the commercial marketplace
based on his recipe and recognized revenues of $500,000 from sale of such
product by September 30, 2006. We are not required to pay Mr. Jordan any
additional fees for use of the recipe. However, in the event we make an outright
sale of the license or sub-license of the recipe we shall share in the proceeds
equally (50/50 split) with Mr. Jordan.

     Our Board of Directors requires that all related party transactions be
reviewed and approved by an independent body of the Board of Directors.

                                       30
<PAGE>

ITEM 13.  EXHIBITS.

NUMBER    DESCRIPTION
------    -----------
3.1       Articles of Incorporation *
3.2       By-laws *
10.1      License Agreement *
14        Code of Ethics
31.1      Rule 13a-14(a)/15d-14a(a) Certification of the Chief Executive Officer
31.2      Rule 13a-14(a)/15d-14a(a) Certification of the Chief Financial Officer
32.1      Section 1350 Certification of the Chief Executive Officer
32.2      Section 1350 Certification of the Chief Financial Officer
__________

* These exhibits were filed under the same exhibit number with our registration
statement on Form SB-2 (file no. 333-125268)and are incorporated herein by
reference.

ITEM 14.  PRINCIPAL ACCOUNTANT FEES AND SERVICES.

     The following is a summary of the fees billed to the Company by Sherb &
Co., LLP for services related to the calendar years ended December 31, 2004 and
2005:

Fee Category                            2004               2005
------------                          --------           --------

Audit Fees ...............            $  3,500           $ 21,829
Audit-related fees .......            $      0           $      0
Tax Fees .................            $      0           $      0
All other fees ...........            $      0           $      0
                                      --------           --------
Total fees ...............            $  3,500           $ 21,829

     Audit fees. Consists of fees for professional services rendered by our
principal accountants for the audit of our annual financial statements and the
review of financial statements included in our Forms 10-QSB or services that are
normally provided by our principal accountants in connection with statutory and
regulatory filings or engagements.

     Audit-related fees. Consists of fees for assurance and related services by
our principal accountants that are reasonably related to the performance of the
audit or review of our financial statements and are not reported under "Audit
fees."

     Tax fees. Consists of fees for professional services rendered by our
principal accountants for tax compliance, tax advice and tax planning.

     All other fees. Consists of fees for products and services provided by our
principal accountants, other than the services reported under "Audit fees,"
"Audit-related fees" and "Tax fees" above.

     The Audit Committee, comprised of Robert E. Jordan and Francis A. Rebello,
has reviewed and discussed with Sherb & Co., LLP the audited consolidated
financial statements of the Company contained in the Company's Annual Report on
Form 10-KSB for the Company's 2005 fiscal year. The Audit Committee has also
discussed with Sherb & Co., LLP the matters required to be discussed pursuant to
SAS No. 61 (Codification of Statements on Auditing Standards, AU Section 380),
which includes, among other items, matters related to the conduct of the audit
of the Company's consolidated financial statements.

                                       31
<PAGE>

     The Audit Committee has received and reviewed the written disclosures and
the letter from Sherb & Co., LLP required by Independence Standards Board
Standard No. 1 (Independence Discussions with Audit Committees), and has
discussed with Sherb & Co., LLP its independence from the Company.

     The Audit Committee has considered whether the provision of services other
than audit services is compatible with maintaining auditor independence. Based
on the review and discussions referred to above, the Audit Committee recommended
to the Board of Directors that the audited consolidated financial statements be
included in the Company's Annual Report on Form 10-KSB for its 2005 fiscal year
for filing with the SEC.

AUDIT COMMITTEE'S PRE-APPROVAL POLICIES

     The Audit Committee's policy is now to pre-approve all audit services and
all permitted non-audit services (including the fees and terms thereof) to be
provided by the Company's independent auditor; provided, however, pre-approval
requirements for non-audit services are not required if all such services (1) do
not aggregate to more than five percent of total revenues paid by the Company to
its accountant in the fiscal year when services are provided; (2) were not
recognized as non-audit services at the time of the engagement; and (3) are
promptly brought to the attention of the Audit Committee and approved prior to
the completion of the audit by the Audit Committee.

The Audit Committee pre-approved all of fees described above.

                                       32
<PAGE>

                                   SIGNATURES

     In accordance with Section 13 or 15(d) of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

                                        SOUTHERN SAUCE COMPANY, INC.

                                        By: /s/ Robert E. Jordan
                                            --------------------
                                        Robert E. Jordan
                                        President (principal executive officer)

                                        By: /s/ Francis A. Rebello
                                            ----------------------
                                        Francis A. Rebello
                                        Treasurer (chief accounting officer)


     In accordance with the Exchange Act, this report has been signed below by
the following persons on behalf of the registrant and in the capacities and on
the dates indicated.


Signature                   Title                              Date
---------                   -----                              ----

/s/ Robert E. Jordan        President                          February 10, 2006
--------------------        (principal executive officer)
Robert E. Jordan            and director


/s/ Francis A. Rebello      Treasurer, Secretary               February 10, 2006
----------------------      (chief accounting officer)
Francis A. Rebello          and director


/s/ Anand Kumar             Director                           February 10, 2006
---------------
Anand Kumar


/s/ Todd W. Rowley          Director                           February 10, 2006
------------------
Todd W. Rowley


/s/ Bob Bova                Director                           February 10, 2006
------------
Bob Bova

Supplemental information to be Furnished With Reports Filed Pursuant to Section
15(d) of the Exchange Act By Non-reporting Issuers

The Registrant did not send to its security holders an annual report covering
its 2005 fiscal year or proxy materials for an annual or other meeting held
during its 2005 fiscal year.

                                       33