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

                                   FORM 10-KSB

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

    For the year ended December 31, 2006

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

    For the transition period from ________________ to ________________

                        Commission file number 000-21753


                         DINERS ACQUISITION CORPORATION
                  Name of Small Business Issuer in Its Charter

       NEVADA                                              88-0263701
State of Incorporation                        I.R.S. Employer Identification No.

  7702 E Doubletree Ranch Suite 300
         Scottsdale, AZ                                      85258
Address of Principal Executive Offices                     Zip code

                                  480-905-5550
                            Issuer's Telephone Number

           Securities registered under Section 12(b) of the Act: NONE

              Securities registered under Section 12(g) of the Act:

                    COMMON STOCK, PAR VALUE $0.001 PER SHARE
                                 Title of class

Check  whether  the  issuer:  (1)  filed  all  reports  required  to be filed by
Section13  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  SB 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 amendments to this Form 10-KSB [ ]

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

The Company's revenues for the fiscal year ended December 31, 2006 were $60,000.

The aggregate  market value of the voting and  non-voting  common equity held by
non-affiliates  of the issuer  amounting  to, in  aggregate  27,385,853  shares,
computed by reference to the price at which the common  equity was sold,  or the
average  bid and asked  price of such  common  equity,  on March 20,  2007,  was
$1,917,010. The number of shares outstanding of the issuer's only class of $.001
par value Common Stock was 27,385,853 on March 12, 2007.
<PAGE>
                                TABLE OF CONTENTS

                                                                            Page
                                                                            ----
PART I

Risk Factors                                                                  3

Item 1.   Description of Business                                             3

Item 2.   Description of Property                                             7

Item 3.   Legal Proceeding                                                    7

Item 4.   Submission of Matters to a Vote of Security Holders                 7

PART II

Item 5.   Market for Common Equity and Related Stockholder Matters            8

Item 6.   Management's Discussion and Analysis of Results and
           Financial Condition                                               10

Item 7.   Consolidated Financial Statements                                  14

Item 8.   Changes in and Disagreements with Accountants on Accounting
           and Financial Disclosure                                          30

Item 8A.  Controls and Procedures                                            30

PART III

Item 9.   Directors, Executive Officers, Promoters, and Control Persons      30

Item 10.  Executive Compensation                                             31

Item 11.  Security Ownership of Certain Beneficial Owners and Management     32

Item 12.  Certain Relationships and Related Transactions                     32

Item 13.  Exhibits and Reports on Form 8-K                                   33

Item 14.  Principal Accountant Fees and Services                             34

                                       2
<PAGE>
                                     PART I

RISK FACTORS

CAUTIONARY NOTICE REGARDING FORWARD LOOKING STATEMENTS

This report contains  forward-looking  statements  within the meaning of Section
27A of the  Securities  Act and  Section  21E of the  Securities  Exchange  Act.
Forward-looking statements deal with our current plans, intentions, beliefs, and
expectations  and are  statements  of future  economic  performance.  Statements
containing  terms  like  "believes,"  "does not  believe",  "plans",  "expects",
"intends", "estimates",  "anticipates", and other phrases of similar meaning are
considered to imply uncertainty and are forward-looking statements.

Forward-looking  statements  involve known and unknown  risks and  uncertainties
that may cause our actual  results in future periods to differ  materially  from
what is currently  anticipated.  We make cautionary  statements  throughout this
report and the  documents we have  incorporated  by reference,  including  those
stated  under the  heading  "Risk  Factors."  You should  read these  cautionary
statements  as  being  applicable  to  all  related  forward-looking  statements
wherever they appear in this report,  the materials  referred to in this report,
and the materials incorporated by reference into this report.

We cannot  guarantee our future  results,  levels of activity,  performance,  or
achievements.  Neither we nor any other person  assumes  responsibility  for the
accuracy and completeness of these forward-looking  statements.  We are under no
duty to  update  any of the  forward-looking  statements  after the date of this
report.

Where we say "we," "us," "our," or "the  Company,"  we mean Diner's  Acquisition
Corporation and its subsidiaries.

ITEM 1. DESCRIPTION OF BUSINESS

BUSINESS DEVELOPMENT

The Company  was  incorporated  in Nevada in August 1990 under the name  Service
Systems  International  Ltd and was inactive  until eight  Canadian and European
individuals acquired it in July 1995.

For the period up to February 2002,  they were the designer,  manufacturer,  and
marketer of state of the art  ultraviolet  disinfection  systems for  wastewater
disinfection with additional application  possibilities in potable water. During
fiscal 2002,  the Company  changed its business  focus away from only  providing
ultraviolet equipment for wastewater  disinfection to the treatment of water for
drinking and other uses, coupled with ultraviolet and filtration.

In fiscal  2002,  the  Company  discontinued  the  manufacturing  of  wastewater
products and entered into various  agreements to change it business  focus.  The
wastewater business was licensed to Clearwater Industries Ltd.

The emphasis of the Company's  business  remained in  ultraviolet  disinfection,
however  they now target  drinking  water with  systems  developed  for low-flow
drinking water  application.  The systems  identified  are, Point of Entry (POE)
purification  system,  which is installed  where the water enters the home,  and
Point of Use (POU) purification system, which is located at the faucet.

During 2002, the Company was unable to raise the additional  funds  necessary to
continue the operations of UVS and with UVS  liabilities  exceeding  assets by a
significant  amount,  the board of directors  and investors  determined  that by
selling UVS the Company could continue viable operations  pursuing a new product
focus (see Our Products).

On December  31, 2002,  the Company  entered  into  various  agreements  for the
disposition of UVS and the removal of the UVS debt and receivable carried on the
Company's  financial   statements.   Manufacturing  and  marketing  of  the  UVS
technology had been  discontinued  by the Company and was licensed to Clearwater
Industries in February  2002.  The purchaser of UVS was 659999 BC Ltd.  Terms of
the sale  included  the transfer by UVS to the Company of all current and future
revenue that may accrue as a result of the UVS technology. Full details of these
agreements are available on Form 8K filed with the SEC on January 15, 2003.

                                       3
<PAGE>
In  December  2002,  the  Company  added  an  additional   business  focus:  the
manufacturing  and  marketing of a primary,  alternative,  and  emergency  power
generating  Magnesium-Air power cell. Through a reverse acquisition concluded on
December 31, 2002 UltraGuard Water Systems Corp.  ("UltraGuard") acquired all of
the outstanding stock of Innovative Fuels Cell  Technologies Inc ("IFCT").  IFCT
is the holder of an option to purchase  worldwide  manufacturing  and  marketing
rights to a 12-volt  Magnesium-Air Semi Fuel Cell from MagPower Systems Inc. for
use  with  UltraGuard's  Point  of Use and  Point  of  Entry  Ultraviolet  Water
Purification  System, and for ancillary uses such as lighting,  radio, and other
low energy electrical needs.

On March 14, 2003, IFCT exercised the license for the Fuel Cell.

On April 21, 2005,  the Company's  directors  voted to change its business focus
and move  UltraGuard  into  restaurant  franchising by signing an agreement with
American Restaurant  Development Company to identify opportunities in restaurant
franchising.  The directors  also voted to reorganize the Company and brought it
to the  shareholders  in a special meeting held on June 13, 2005. At the meeting
shareholder  approved  the name change to Creative  Eateries  Corporation  and a
reverse split of the Companies common stock of 1:100.

On May 3, 2005, the directors approved the sale of all of Creative's  filtration
and disinfection  technologies and intellectual property to Innovative Fuel Cell
Technologies  Inc. On June 30, 2005, the sale was  completed.  As a condition of
the sale,  all the  shares of  Innovative  Fuel  Cell  Technologies  Inc will be
distributed on a prorata basis to the Creative's shareholders of record June 13,
2005.

On December 29, 2005, the Company and Franchise  Capital  Corporation  agreed to
rescind the October Purchase Agreement and entered into a Funding Agreement. The
Company intended to provide Franchise Capital  Corporation with a total $600,000
in funding for the operation of Kokopelli  and Comstock.  The Company had funded
approximately  $150,000  and had  agreed to fund the  balance  of  approximately
$450,000 with monthly payments of $100,000 beginning January 25, 2006. In return
for the funding of  operation  for  Kokopelli  and  Comstock  Jake's,  Franchise
Capital Corporation was to pay the Company an amount equal to 50% of the profits
Franchise  Capital  Corporation  receives  from its  ownership in Kokopelli  and
Comstock  Jake's for the periods  commencing  on July 1, 2006 and ending on June
30,  2011.  If the  Company  failed to provide the full amount of funding but at
least  $300,000,  the profit  payments  will be reduced to 25%.  If the  Company
failed  to  provide  at  least  $300,000  of  funding,  then  Franchise  Capital
Corporation  will have no obligation to pay any profit  payments to the Company.
The Company did fail on its obligation.  As a result of the default, the Company
has released all claims it may have related to Kokopelli Franchise Company,  and
Franchise Capital Corporation. However, the Company did receive 80,000 shares of
restricted  common  stock in Great  American  Food Chain for its  investment  in
Kokopelli.  Great American Food Chain acquired  Kokopelli from Franchise Capital
Corporation.

BUSINESS OF ISSUER

Diner's  Acquisition  Corporation  (Diner's)  (formerly  Creative  Eateries  and
Vancouver-based  UltraGuard  Water System Corp) or  ("Company"),  is a franchise
development  company  organized to  capitalize  on the new,  growing  demand for
"fast-casual/full-service"  restaurants in North  America.  Diner's is poised to
take  advantage of this new  phenomenon  by targeting  emerging and  undervalued
restaurant/franchise  concepts  and  owning  equity  directly  in these  brands.
Diner's  intends to grow these brands  through  expanding  corporate  growth and
franchising by leveraging  its skilled team of restaurant  and  franchise,  deep
operational expertise and a database of potential  franchisees.  The Company had
two concepts:  Q's House of Barbecue and Fit `N Healthy. These concepts will not
be  developed  and the  balances  have  been  consolidated  into  the  financial
statements of Diner's  Acquisition.  The Company continues to identify potential
concepts  for their  portfolio  and is currently  in  negotiations  with several
acquisition targets.

OUR SERVICES

The Company intends to provide  franchise brand management  services in numerous
regional  markets across the United States.  Through the terms of our "Franchise
Agreement,"  the Company  authorizes  individuals  and/or  companies  to form or
establish  and operate  concept  restaurants  at approved  locations.  Under the
agreement,  the Company would be obligated to provide  certain  services for the
opening  of,  and the  ongoing  support  of,  each  restaurant.  Those  services
generally include:

     -    review and approval of restaurant location
     -    review and approval of plans and layout design
     -    identification of sources of suppliers

                                       4
<PAGE>
     -    provide an operations  manual for service  guidelines  and  restaurant
          management techniques
     -    provide  initial  and  ongoing  training  in  acceptable   methods  of
          operations, food preparation, management controls, and legal framework
          of restaurant operations
     -    provide  ongoing support to maintain  quality  products at competitive
          prices
     -    perform ongoing  consistency and quality inspections of restaurants to
          maintain uniform acceptable standards

DISTRIBUTION METHODS OF OUR SERVICES

Diner's targets emerging and undervalued  restaurant/franchise concepts with the
intent to own equity directly in these brands. The Company intends to grow these
brands through  expansion of corporate growth and franchising.  The Company will
obtain prospective franchises primarily from referrals from existing franchises,
affiliations  with industry  experts and from selected  marketing  efforts.  The
selective  criteria  considered in the review and approval of new franchisees is
prior experience in operating  restaurants or comparable business acumen and the
existence of sufficient capital resources to reasonably ensure success.

NEW PRODUCTS OR SERVICES

None

COMPETITIVE BUSINESS CONDITIONS

Diner's  competes in the fast,  casual and  full-service  dining segments of the
restaurant  industry.  As a franchisor  of  restaurants,  the Company must first
attract successful franchisees and second, must assist franchisees in attracting
customers in this segment.  The Company  competes  with an increasing  number of
national chains of fast, casual and full-service  dining,  several of which have
dominant market positions and possess  substantially greater financial resources
and longer operating histories.

The fast, casual and full-service dining segments of the restaurant industry are
highly competitive with respect to price, service,  location,  and food quality.
These competitive  factors are affected by changes in consumer taste,  local and
national economic conditions, population trends, and local traffic patterns.

A number of companies  have adopted  "value  pricing"  strategies in response to
flattening  growth rates and/or  declines in average sale per  restaurant.  Such
strategies could draw customers away from companies that do not engage in "value
pricing" or discount  pricing,  and could also  negatively  impact the operating
margins by attempting to match competition-pricing points.

PRINCIPAL SUPPLIERS

The Company  requires each  franchisee to purchase raw materials;  both food and
non-food,  from  authorized  and  designated  distributors  who  may  only  sell
authorized and approved raw materials. The Company negotiates relationships with
manufacturers  and suppliers on a national level for all products whether or not
they contain the Company's logo.  Franchisees may request approval of additional
manufacturers,  suppliers,  or distributors  subject to the Company's  approval.
Approval is based upon a number of conditions including price, quality,  ability
to service the system on a national basis and such other reasonable standards as
may be promulgated from time to time.

CUSTOMERS

Diner's targets  prospective  franchises  primarily from referrals from existing
franchises,  affiliations  with  industry  experts and from  selected  marketing
efforts.

A number of companies  have adopted  "value  pricing"  strategies in response to
flattening  growth rates and/or  declines in average sale per  restaurant.  Such
strategies could draw customers away from companies that do not engage in "value
pricing" or discount  pricing,  and could also  negatively  impact the operating
margins by attempting to match competition-pricing points.

                                       5
<PAGE>
LICENSES, FRANCHISES, ROYALTY AGREEMENTS

Franchisors are required to register the uniform franchise  offering circular in
certain  states before  franchises can be sold. The Company is in the process of
identifying  those states and the  requirements  for registration and licensing.
These  registrations  will be completed prior to franchise sales in the required
territories.

Franchise fees are payments  received from franchisees and recognized as revenue
in the period in which the store opens.  The  franchise  fee for a  franchisee's
initial store will be in the range of $25,000-$35,000.

Royalties are based on a percentage of franchisees'  net sales and recognized in
the same period that the franchise store sales occur.  Generally,  royalties are
earned at the rate of 5% of sales.

REGULATORY MATTERS

The  Federal  Trade  Commission  (the  FTC") and  various  states  regulate  our
principal  activity of selling  restaurant  franchises.  Such regulations govern
disclosure,  performance,  and  procedure  in the sale and  transfer  of new and
existing  franchises.  In general,  the FTC's  regulations  require us to timely
furnish a franchise  offering  circular to  prospective  franchisees  containing
prescribed  information.  Certain  state laws also require  registration  of the
franchise  offering  circular with applicable  state  authorities.  Other states
monitor or regulate the franchise relationship,  particularly the sale, renewal,
and termination of an agreement.

In  October  1999,  the FTC issued  proposed  changes to the FTC Rule that would
effect certain disclosure  obligations in connection with franchise sales. These
proposed  changes are still  subject to public  comment,  and even if adopted as
proposed,  the  Company  does not  think the  changes  would  materially  affect
franchise  sales or other  operations.  The  Company  is not  aware of any other
probable  pending  franchise  legislation  that is likely  to affect  operations
significantly.  The Company believes that our operations  comply in all material
respects with the FTC Rule and the applicable state franchise laws.

The Company is also subject to "Federal Fair Labor Standards Act," which governs
minimum  wages,  overtime,  working  conditions and other matters as well as the
"Americans With Disabilities Act."

From time to time,  the Company will operate  company owned  restaurants.  While
operating the restaurants,  the Company will be subject to a variety of federal,
state,  and local laws regarding  minimum wage  standards,  sanitation,  health,
fire, alcoholic beverage, and safety codes.

The Company  believes it will maintain  compliance with all applicable  federal,
state, and local laws and  regulations.  Current expected changes in federal and
individual  state laws and  regulations  concerning  the sale,  termination  and
non-renewal  of  franchises  are not  expected  to  have a  material  impact  on
operations.  There  can  be no  assurance  that  existing  or  future  franchise
regulations  will not have an  adverse  effect on the  ability to  maintain  and
expand the Company's franchise program.

RESEARCH AND DEVELOPMENT ACTIVITIES

The Company engages in research and development on an ongoing basis, testing new
products and procedures for possible  introduction  into the Company's  systems.
While  research  and  development  operations  are  considered  to be  of  prime
importance to the Company,  amounts expended for these activities are not deemed
material.

ENVIRONMENTAL LAWS

Various federal, state, and local regulations have been adopted which affect the
discharge of materials  into the  environment or which  otherwise  relate to the
protection  of  the  environment.   The  Company  does  not  believe  that  such
regulations will have a material effect on its capital  expenditures,  earnings,
or  competitive  position.  The  Company  cannot  predict  the  effect of future
environmental legislation or regulations.

                                       6
<PAGE>
EMPLOYEES

As of December  31,  2006,  the Company  had no full time  employees  engaged in
management  and  operational  activities.  Part time  consultants  are used when
required, for accounting, general office, and other activities.

ITEM 2. DESCRIPTION OF PROPERTY

The Company's office space is shared with various other companies and located at
7702 E. Doubletree Ranch,  Suite #300,  Scottsdale,  AZ 85258. The lease term is
month to month.  Management  believes that its  facilities  are adequate for its
present business.

Diner's Acquisition does not own or lease any other property.

ITEM 3. LEGAL PROCEEDINGS

On April 25, 2003,  Chelverton Fund Limited filed a suit in the Supreme Court of
British  Columbia  against the Company for  non-payment of debt in the amount of
$155,000. The Company entered an appearance, filed a defense against this claim,
and attempted to negotiate a settlement. Chelverton filed additional information
that  supported  their  claim  and the  Company  responded  with a "no  defines"
position  and  judgment  was  issued  in the  amount of  $193,944  (Cnd$234,642)
including  interest  and legal costs.  On April 5, 2004 the Company  appeared in
Supreme  Court to  provide  to  Chelverton  and the court  specific  information
pertaining to the Company's assets and its ability to pay the judgment including
interest.  The Company  was  required to and has  provided  additional  detailed
financial information. In December 2006, Chelverton accepted 3,771,528 shares of
the Company's restricted common in exchange for the settlement of the debt.

The Company has made a provision for a loss of $27,000 in a claim filed with the
British  Columbia Labor  Relations  (LRB) Board,  made by a former  employee for
wrongful  dismissal.  The loss amount was the amount determined by the LRB. This
amount  represented the total probable loss of the lawsuit and has been recorded
as an accrued  liability as of December  31, 2004 and 2003.  On October 20, 2005
the employee  filed a lawsuit in the Supreme Court of British  Columbia  against
the Company and a former  subsidiary;  UV Systems Technology Inc whom the former
employee was employed by, claiming wrongful dismissal. UV Systems Technology Inc
has filed a Statement of Defense.  Counsel for the former employee  informed the
Company that counsel would be filing an amended  Statement of Claim.  The amount
of the  claim  is for one  year of  salary,  which  would  represent  CAN$90,000
(US$77,193)  including  the $27,000  determined  for the LRB.  Subsequent to the
year-end,  on February 28, 2006,  the Company  appeared in BC Supreme Court at a
Rule 18A  hearing at which the lawyers for the  plaintiff  and the Company  each
presented  evidence to the Court.  The Judge reserved his decision on the matter
until April 2006.  In April 2006 the Judge found in favour of the  Company.  The
plaintiff has since appealed. The Company anticipates a response,  regarding the
appeal, from the Court before May 2007.

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

None

                                       7
<PAGE>
                                     PART II

ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

The  Company's  common  stock is traded in the  over-the-counter  market  and is
listed on the Over the Counter  Bulletin  Board under the symbol  "DAQC.OB." The
following  table  sets  forth for the  periods  indicating  the high and low bid
prices of our common stock as reported by the OTC-BB during each quarter for the
two years ended December 31, 2005 and December 31, 2006. The quotations  reflect
inter-dealer prices,  without retail mark-up,  markdown, or commission,  and may
not represent  actual  transactions.  All figures shown in the fiscal year ended
December  31,  2006 are actual  values  reported by the  OTC-BB.  The  following
numbers have been adjusted for a 1:5 reverse stock split, which was effective on
September 21, 2006.

FISCAL YEAR 2005                              LOW            HIGH
----------------                              ---            ----
  Quarter ended March 31, 2005               20.00          22.00
  Quarter ended June 30, 2005                10.00          11.00
  Quarter ended September 30, 2005            7.00           7.25
  Quarter ended December 31, 2005             1.20           1.50

FISCAL YEAR 2006                              LOW            HIGH
----------------                              ---            ----
  Quarter ended March 31, 2006               0.65            1.65
  Quarter ended June 30, 2006                0.325           1.30
  Quarter ended September 30, 2006           0.0505          0.50
  Quarter ended December 31, 2006            0.055           0.25

STOCKHOLDERS

As of December 31, 2006, there were  approximately  213 holders of record of the
common stock.

COMMON STOCK

Our authorized capital stock consists of 200,000,000 shares of common stock with
a par value of $0.001 per share.  On December  31, 2006,  there were  27,385,853
shares issued and outstanding.  The holders of outstanding  shares of our common
stock are entitled to receive dividends out of assets legally available at times
and in  amounts  as the  board of  directors  may from  time to time  determine.
Holders of common  stock are  entitled  to one vote per share on all  matters on
which the holders of common stock are entitled to vote.  The common stock is not
entitled  to  preemptive  rights  and may not be  redeemed  or  converted.  Upon
liquidation,  dissolution,  or  winding  up, the assets  legally  available  for
distribution  to our  shareholders  are divided  among the holders of the common
stock in  proportion  to the  number of shares of common  stock  held by each of
them, after payments of all of our debts and liabilities.

The  Company  has never had  profits  and has never paid cash  dividends  on its
common stock. It is our intention to retain future earnings,  if any, to provide
funds for business operations and, accordingly,  we do not anticipate paying any
cash dividends on our common stock in the foreseeable  future.  However,  we are
under no restriction as to the payment of dividends.

OTHER COMMON STOCK SALES

During the year ended December 31, 2006, the Company issued the following shares
for the listed consideration:

                                       8
<PAGE>
<TABLE>
<CAPTION>
                                  Residency/         Consideration
Date                 Shares       Citizenship          Valued at        Consideration       Exemption
----                 ------       -----------          ---------        -------------       ---------
<S>                 <C>           <C>                <C>                <C>                <C>
Jan 5/06             150,000          USA             $ 150,000          Consulting            S-8*
Jan 5/06              50,000          USA             $  50,000          Consulting            Reg144
Jan 5/06              96,000          USA             $  96,000          Consulting            S-8*
Jan 5/06              50,000          USA             $  50,000          Consulting            S-8*
Jan 20/06              8,000          USA             $  10,000          Incentive             Reg144
Feb 15/06              8,000          USA             $  10,000          Subscription
Apr 5/06              20,000          CANADA          $  20,000          Consulting            S-8*
Apr 5/06               4,000          USA             $   4,000          Consulting            S-8*
Apr 5/06               4,000          USA             $   4,000          Consulting            S-8*
Apr 5/06              25,000          USA             $  25,000          Consulting            S-8*
Apr 5/06              11,000          USA             $  11,000          Consulting            S-8*
Apr 5/06              20,000          CANADA          $  20,000          Consulting            S-8*
Apr 5/06              20,000          CANADA          $  20,000          Consulting            S-8*
Apr 7/06               8,000          USA             $   8,800          Consulting            S-8*
May 8/06              60,000          USA             $  63,000          Consulting            S-8*
May 16/06             12,000          USA             $  13,200          Consulting            S-8*
May 26/06             50,000          USA             $  46,250          Consulting            S-8*
May 30/06             30,000          USA             $  32,250          Consulting            S-8*
May 30/06              2,000          USA             $   2,150          Consulting            S-8*
May 30/06              4,000          USA             $   4,300          Consulting            S-8*
May 30/06             64,000          USA             $  68,800          Consulting            S-8*
Jun 5/06             100,000          CANADA          $  95,000          Consulting            S-8*
Aug 2/06              40,000          USA             $  36,000          Consulting            S-8**
Aug 23/06          2,662,770          USA             $ 404,708          Debt                  Reg144
Sep 21/06          2,816,117          CANADA          $ 153,378          Debt                  Reg144
Sep 21/06          4,987,232          CANADA          $ 272,275          Debt                  Reg144
Oct20/06           1,719,189          CANADA          $  85,959          Debt                  Reg144
Oct 23/06          1,000,000          CANADA          $ 250,000          Consulting            S-8**
Oct 23/06          1,000,000          CANADA          $ 250,000          Consulting            S-8**
Oct 23/06            500,000          CANADA          $ 125,000          Consulting            Reg144
Dec 5/06             600,000          USA             $  72,000          Consulting            Reg144
Dec 11/06          3,771,528          USA             $ 212,565          Debt                  Reg144
</TABLE>

----------
*  From registered S-8 on February 9, 2006
** From registered S-8 on July 18, 2006

Balance Outstanding December 31, 2006: 27,385,853

                                       9
<PAGE>
At  a  special  meeting  of  the  shareholders  held  September  21,  2006,  the
shareholders  approved a 1 for 5 reverse split of the Company's  stock which has
been accounted for retroactively.

PREFERRED STOCK

On September 21, 2006,  the Company's  Board of Directors  authorized 10 million
shares of a new  class of  Preferred  Series  stock at $10 per  shares  having a
conversion  rate of one  preferred  share into four common shares and each share
paying a dividend of 10% APR.

STOCK OPTIONS

Stock options were issued to one employee for 160,000  shares during the quarter
ending  March 31,  2006.  The Company  expensed the fair value of the options of
$168,000 in the quarter ended March 31, 2006. The options vested immediately and
were exercised within the period.  There are no options  outstanding at December
31, 2006.

ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS AND FINANCIAL CONDITION

The following  discussion and analysis  should be read in  conjunction  with our
consolidated  financial  statements and notes and the information included under
the caption  "Risk  Factors"  included  elsewhere in this  document.  Except for
historical  information,   the  following  discussion  contains  forward-looking
statements  that involve  risks and  uncertainties,  such as  statements  of our
plans, objectives, expectations and intentions and our current beliefs regarding
revenues  we  might  earn if we are  successful  in  implementing  our  business
strategies. See "Special Note Regarding Forward-Looking  Statements" for further
information regarding forward-looking  statements. Our actual results may differ
materially  from the results  discussed in the  forward-looking  statements as a
result of a number of factors,  many of which are beyond our control,  including
those  factors  discussed  under  "Risk  Factors"  and  other  headings  in this
document,  which could, among other things,  cause the price of our common stock
to fluctuate substantially.

OVERVIEW

Consolidated  balance sheets of Diner's Acquisition  Corporation and the related
consolidated  statements of operations and cash flows and stockholders'  equity,
include  operations  for the twelve month period ending  December 31, 2006.  The
company has generated  total revenue for the twelve month period ending December
31, 2006 of $60,000.  This revenue relates to construction  development services
performed by the Company.

We have incurred aggregate net losses of approximately $8,488,428 for the period
ending  December  31,  2006.  We  will  likely  continue  to  incur  significant
additional operating losses as marketing efforts continue.  Operating losses may
fluctuate  from quarter to quarter as a result of  differences  in the timing of
expenses incurred and when revenue is recognized.

Total general and administrative operating expenses for the twelve months ending
December 31, 2006 were  $2,936,879.  This was primarily for consulting  fees and
the issuance of the Company's common stock for these fees.

The Company  recorded a net loss for the twelve months ending  December 31, 2006
of  $2,928,042.  This loss was primarily  due to the expense  related to various
consultants.  The consultants provide such services and advice to the Company in
business development, business strategy and corporate image

                                       10
<PAGE>
PLAN OF OPERATION

During  fiscal  year 2007,  we plan to continue  product  and service  awareness
marketing,  identify and acquire concepts to franchise,  and provide contractual
management services.  The Company will have to raise additional funds in 2006 to
satisfy cash  requirements and fund future  acquisitions.  As the Company grows,
additional employees will need to be added to support the business. In addition,
employees may be added through the acquisition of existing restaurants.

BASIS OF PRESENTATION

The financial  statements  include accounts of Diner's  Acquisition  Corporation
consolidated  with Q's House of  Barbecue  Franchise  Company and Fit `N Healthy
Franchise Company.

LIQUIDITY AND CAPITAL RESOURCES

The nature of our  business may be expected to include a normal lag time between
the  incurring  of operating  expenses and the  collection  of  receivables.  In
addition, we are dependent on franchise sales,  royalties from franchisees,  and
income from acquired restaurants. For these and other reasons, we may experience
periods of limited working capital and may be expected to require  financing for
working capital during those periods.

In addition,  we will require  financing over and above our current resources to
sustain our operations and expand our marketing  efforts.  We cannot assure that
the  additional  financing can be obtained on a timely basis,  on terms that are
acceptable or if at all.

We had cash and cash  equivalents  of $544 as of December 31, 2006.  The Company
experienced a cash outflow of $(111,627)  from operating  activities  during the
twelve months ending December 31, 2006.

We expect that during 2007 we will  continue to depend on receipt of  additional
funds through public or private  equity or debt sales or other lender  financing
to fund the purchase of restaurants  and concepts,  and general  operational and
sales expenses. We actively continue to raise funds and seek sources of capital.
Failure to receive these funds may be expected to have a material adverse effect
on our company.

During 2006, we financed our operations in part,  from loans from others,  loans
from related parties, and shareholders of the Company.

CRITICAL ACCOUNTING ESTIMATES AND ASSUMPTIONS

The  preparation  of our  financial  statements in  conformity  with  accounting
principles  generally  accepted  in the United  States of America  requires  our
management to make certain  estimates and  assumptions  that affect the reported
amounts  of assets and  liabilities  and  disclosure  of  contingent  assets and
liabilities at the date of the financial  statements and the reported amounts of
revenues and expenses during the reporting  period.  As such, in accordance with
the use of  accounting  principles  generally  accepted in the United  States of
America,  our actual  realized  results  may differ  from  management's  initial
estimates  as reported.  A summary of our  significant  accounting  policies are
detailed  in the  notes  to the  financial  statements,  which  are an  integral
component of this filing.

CERTAIN RISK FACTORS AFFECTING OUR BUSINESS

Our  business  involves  a high  degree  of  risk.  Potential  investors  should
carefully  consider the risks and  uncertainties  described  below and the other
information  in this report before  deciding  whether to invest in shares of our
common  stock.  If any of the  following  risks  actually  occur,  our business,
financial condition, and results of operations could be materially and adversely
affected.  This could  cause the trading  price of our common  stock to decline,
with the loss of part or all of an investment in the common stock.

WE HAVE A LIMITED  OPERATING  HISTORY AND THERE IS NO ASSURANCE THAT OUR COMPANY
WILL  ACHIEVE  PROFITABILITY.   Until  recently,  we  have  had  no  significant
operations with which to generate profits or greater liquidity. Although we have
recently  established joint ventures with various fast-casual dining restaurants

                                       11
<PAGE>
in keeping with our proposed  business model, we have not generated a meaningful
amount of operating revenue and we have a very limited current operating history
on which investors can evaluate our potential for future success. Our ability to
generate revenue is uncertain and we may never achieve profitability.  Potential
investors  should  evaluate  our  company  in  light  of the  expenses,  delays,
uncertainties,   and   complications   typically   encountered   by  early-stage
businesses,  many of which will be beyond our control.  These risks  include the
following:

     *    lack of sufficient capital,
     *    unanticipated problems,  delays, and expenses relating to acquisitions
          of  other   businesses,   concepts,   or   product   development   and
          implementation,
     *    licensing and marketing difficulties,
     *    competition, and
     *    uncertain market acceptance of our products and services.

As a result of our  limited  operating  history,  our plan for  growth,  and the
competitive  nature  of the  markets  in which  we may  compete,  our  company's
historical  financial data are of limited value in anticipating  future revenue,
capital requirements,  and operating expenses.  Our planned capital requirements
and  expense  levels  will  be  based  in part  on our  expectations  concerning
potential  acquisitions,  capital  investments,  and future  revenue,  which are
difficult  to  forecast  accurately  due  to  our  company's  current  stage  of
development.  We  may be  unable  to  adjust  spending  in a  timely  manner  to
compensate  for  any  unexpected  shortfall  in  revenue.  Once we  acquire  new
restaurant  concepts,  product  development and marketing  expenses may increase
significantly as we expand operations. To the extent that these expenses precede
or are not rapidly followed by a corresponding increase in revenue or additional
sources of financing,  our business,  operating results, and financial condition
may be materially and adversely affected.

WE MAY NEED SIGNIFICANT INFUSIONS OF ADDITIONAL CAPITAL.  Based upon our current
cash reserves and forecasted operations,  we believe that we will need to obtain
outside funding. We may require significant  additional  financing in the future
in order to  further  satisfy  our cash  requirements.  Our need for  additional
capital to finance our business strategy, operations, and growth will be greater
should, among other things,  revenue or expense estimates prove to be incorrect.
If we fail to arrange for sufficient  capital in the future,  we may be required
to reduce the scope of our  business  activities  until we can  obtain  adequate
financing. We cannot predict the timing or amount of our capital requirements at
this  time.  We may not be able to obtain  additional  financing  in  sufficient
amounts or on acceptable  terms,  when needed,  which could adversely affect our
operating  results and prospects.  Debt  financing must be repaid  regardless of
whether or not we generate  profits or cash flows from our business  activities.
Equity financing may result in dilution to existing shareholders and may involve
securities that have rights,  preferences,  or privileges that are senior to our
common stock.

WE WILL FACE A VARIETY OF RISKS ASSOCIATED WITH ESTABLISHING AND INTEGRATING NEW
JOINT VENTURES.  The growth and success of our company's business will depend to
a great  extent  on our  ability  to find  and  attract  appropriate  restaurant
concepts  with which to form joint  ventures  in the future.  We cannot  provide
assurance that we will be able to

     *    identity suitable restaurant concepts,
     *    form joint ventures on commercially acceptable terms,
     *    effectively  integrate the  operations of any joint  ventures with our
          existing operations,
     *    manage effectively the combined operations of the businesses,
     *    achieve our  operating and growth  strategies  with respect to the new
          joint ventures, or
     *    reduce our  overall  selling,  general,  and  administrative  expenses
          associated with the new joint ventures.

The integration of the management,  personnel,  operations,  products, services,
technologies,  and facilities of any businesses that we associate ourselves with
in the future could involve  unforeseen  difficulties.  These difficulties could

                                       12
<PAGE>
disrupt our ongoing  businesses,  distract our  management  and  employees,  and
increase  our  expenses,  which  could  have a  material  adverse  affect on our
company's business, financial condition, and operating results.

WE DEPEND ON OUR CURRENT MANAGEMENT TEAM. Our company's success will depend to a
large  degree upon the skills of our current  management  team and  advisors and
upon our ability to identify,  hire, and retain  additional  senior  management,
sales,  marketing,  technical,  and financial  personnel.  We may not be able to
retain our  existing  key  personnel  or to attract  and retain  additional  key
personnel. The loss of any of our current executives,  employees, or advisors or
the failure to attract, integrate, motivate, and retain additional key employees
could have a material adverse effect on our company's  business.  We do not have
"key person" insurance on the lives of any of our management team.

OUR  COMPANY  MAY NOT BE ABLE TO MANAGE ITS GROWTH.  We  anticipate  a period of
significant  growth. This growth could cause significant strain on our company's
managerial,  operational,  financial,  and other resources.  Success in managing
this expansion and growth will depend,  in part,  upon the ability of our senior
management  to manage  effectively  the growth of our  company.  Any  failure to
manage the proposed  growth and  expansion of our company  could have a material
adverse effect on our company's business.

THERE IS NO ASSURANCE THAT OUR FUTURE  PRODUCTS AND SERVICES WILL BE ACCEPTED IN
THE  MARKETPLACE.  Our products and  services  may not  experience  broad market
acceptance.  Any market  acceptance for our company's  products and services may
not  develop  in a timely  manner or may not be  sustainable.  New or  increased
competition may result in market saturation,  more competitive pricing, or lower
margins. Further, overall performance and user satisfaction may be affected by a
variety of  factors,  many of which will be beyond our  company's  control.  Our
company's  business,   operating  results,  and  financial  condition  would  be
materially  and  adversely  affected if the market for our products and services
fails to develop or grow,  develops or grows more slowly  than  anticipated,  or
becomes  more  competitive  or if our  products and services are not accepted by
targeted customers even if a substantial market develops.

WE MAY FACE STIFF  COMPETITION.  There are existing companies that offer or have
the ability to develop  products and services  that will compete with those that
our  company  may offer in the  future.  These  include  large,  well-recognized
companies with  substantial  resources and  established  relationships  in their
respective industries. Their greater financial,  technical, marketing, and sales
resources  may permit them to react more  quickly to emerging  technologies  and
changes  in  customer  requirements  or  to  devote  greater  resources  to  the
development,  promotion,  and sale of competing products and services.  Emerging
companies  also may develop and offer  products and  services  that compete with
those offered by our company.

OUR COMMON STOCK MAY BE SUBJECT TO THE "PENNY STOCK" RULES AS PROMULGATED  UNDER
THE EXCHANGE ACT. In the event that no exclusion  from the  definition of "penny
stock"  under the  Securities  Exchange Act of 1934,  as amended (the  "Exchange
Act") is available,  then any broker  engaging in a transaction in our company's
common stock will be required to provide its  customers  with a risk  disclosure
document,   disclosure  of  market  quotations,   if  any,   disclosure  of  the
compensation of the broker-dealer  and its sales person in the transaction,  and
monthly account statements showing the market values of our company's securities
held in the customer's  accounts.  The bid and offer quotation and  compensation
information  must be provided  prior to effecting  the  transaction  and must be
contained  on the  customer's  confirmation  of sale.  Certain  brokers are less
willing to engage in  transactions  involving  "penny stocks" as a result of the
additional  disclosure  requirements  described  above,  which  may make it more
difficult for holders of our company's common stock to dispose of their shares.

TWELVE-MONTH PERIOD - DECEMBER 31, 2006

REVENUES.  For fiscal  2006,  we  reported  revenues of $60,000  resulting  from
construction development services performed by the Company as compared to fiscal
2005, where we reported revenues of $505.

GENERAL AND ADMINISTRATIVE EXPENSE. For fiscal 2006, we reported G&A expenses of
$2,936,879.  This was  primarily  for  consulting  fees and the  issuance of the
Company's  common  stock for these  fees as  compared  to fiscal  2005  where we
reported G&A expenses of $5,456,825.

                                       13
<PAGE>
NET LOSS FOR THE PERIOD.  For fiscal 2006, we reported a net loss of $2,928,042.
This loss was primarily due to the expense related to various  consultants.  The
consultants  provide  such  services  and  advice  to the  Company  in  business
development,  business strategy,  and corporate image as compared to fiscal 2005
where we reported a net loss of $5,558,554.

NET LOSS PER SHARE. For fiscal 2006, we reported a net loss per share of ($0.22)
as compared to fiscal 2005 where we reported a net loss per share of ($0.85).

OFF-BALANCE SHEET ARRANGEMENTS AND AGGREGATE CONTRACTUAL OBLIGATIONS

None

ITEM 7. CONSOLIDATED FINANCIAL STATEMENTS

Index to Consolidated Financial Statements

Report of Independent Registered Public Accounting Firm

Consolidated Balance Sheet

Consolidated Statements of Operations

Consolidated Statements of Cash Flows

Consolidated Statement of Stockholders' Equity (Deficit)

Notes to the Consolidated Financial Statements

                                       14
<PAGE>
            REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


To the Stockholders and the Board of Directors
of Diner's Acquisition Corporation:

We  have  audited  the  accompanying   consolidated  balance  sheet  of  Diner's
Acquisition Corporation and subsidiaries as of December 31, 2006 and the related
consolidated  statements of operations,  stockholders' equity (deficit) and cash
flows for the period in each of the two years then ended and for the period from
September  24,  2004  (date of  inception)  through  December  31,  2006.  These
consolidated  financial  statements  are  the  responsibility  of the  Company's
management.  Our  responsibility is to express an opinion on these  consolidated
financial statements 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
consolidated financial statements are free of material misstatement. The Company
is not  required  to  have,  nor were we  engaged  to  perform,  an audit of its
internal control over financial reporting.  Our audit included  consideration of
internal  control  over  financial  reporting  as a basis  for  designing  audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the  effectiveness  of the Company's  internal  control
over  financial  reporting.  Accordingly,  we express no such opinion.  An audit
includes examining, on a test basis, evidence supporting amounts and disclosures
in the consolidated  financial statements.  An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall  consolidated  financial  statement  presentation.  We
believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly, in all material respects, the consolidated financial position of Diner's
Acquisition Corporation and subsidiaries as of December 31, 2006 and the results
of its operations and its cash flows for he period in each of the two years then
ended and for the period from  September  24, 2004 (date of  inception)  through
December 31, 2006., in conformity with accounting  principles generally accepted
in the United States of America.

The accompanying  consolidated  financial statements have been prepared assuming
that the Company will continue as a going concern.  The Company has incurred net
losses and has yet to generate revenue sufficient to support ongoing operations.
The Company will require  additional capital to implement its business plan. The
uncertainty  of the  Company's  ability to raise future  funding and the lack of
cash flow from operations raise substantial doubt about the Company's ability to
continue as a going concern. Management's plans with regard to these matters are
discussed in Note 1. The  consolidated  financial  statements do not include any
adjustments  relating to the recoverability and classification of asset carrying
amounts or the amount and classification of liabilities that might result should
the Company be unable to continue as a going concern.


/s/ Epstein, Weber & Conover, PLC
---------------------------------------
Scottsdale, Arizona
April 17, 2006

                                       15
<PAGE>
Diner's Acquisition Corporation
 (A Development Stage Company)
Consolidated Balance Sheets

                                                                    December 31,
                                                                       2006
                                                                    ----------
                                                                        $
ASSETS

Current Assets
  Cash                                                                     544
  Accounts receivable                                                       --
  Notes receivable                                                          --
                                                                    ----------
Total Current Assets                                                       544
                                                                    ----------

Prepaid expenses and deposits                                              450
Property and Equipment (Note 3)                                          2,277
                                                                    ----------

Total Assets                                                             3,270
                                                                    ==========

LIABILITIES AND STOCKHOLDERS' DEFICIT

Current Liabilities
  Accounts payable                                                     641,547
  Accrued liabilities                                                  214,541
  Notes payable (current)                                              276,635
  Loans payable (current)                                                   --
                                                                    ----------
Total Current Liabilities                                            1,132,722
                                                                    ----------

  Loans payable (long-term portion)                                         --
  Amounts owing to related parties                                          --
                                                                    ----------
Total Liabilities                                                    1,132,722
                                                                    ----------
Stockholders' Deficit
  Common stock, (Note 6)
   200,000,000 shares authorized, with a par value of $0.001
   27,385,853 and 7,333,017 issued and outstanding,
   respectively                                                         27,385
  Additional paid-in capital                                         7,331,591
  Deficit Accumulated in the Development Stage                      (8,488,428)
                                                                    ----------

Total Stockholders' Deficit                                         (1,129,452)
                                                                    ----------

Total Liabilities and Stockholders' Deficit                              3,270
                                                                    ==========

           See accompanying notes to consolidated financial statements

                                       16
<PAGE>
Diner's Acquisition Corporation
(A Development Stage Company)
Consolidated Statements of Operations

<TABLE>
<CAPTION>
                               For The Period
                           from September 24, 2004
                               (Inception) to           Year Ended            Year Ended
                                December 31,            December 31,          December 31,
                                   2006                    2006                  2005
                                -----------             -----------           -----------
                                     $                       $                     $
<S>                            <C>                     <C>                      <C>
Revenue                              60,505                  60,000                   505

Cost of sales                            --                      --                    --
                                -----------             -----------           -----------
Total Gross Profit                   60,505                  60,000                   505
                                -----------             -----------           -----------
Expenses
   General and
   administrative                 8,395,537               2,936,879             5,456,825
   Interest                         153,396                  51,163               102,233
                                -----------             -----------           -----------
Total Expenses                    8,548,933               2,988,042             5,559,058
                                -----------             -----------           -----------
Net Loss from Operations         (8,488,428)             (2,928,042)           (5,558,554)
                                -----------             -----------           -----------

Net Loss for the Period          (8,488,428)             (2,928,042)           (5,558,554)
                                ===========             ===========           ===========
Net Loss Per Share -
Basic and Diluted                     (0.90)                  (0.22)                (0.85)
                                ===========             ===========           ===========
Weighted Average
Number of Shares
Outstanding                       9,474,312              13,277,712             6,554,601
                                ===========             ===========           ===========
</TABLE>


          See accompanying notes to consolidated financial statements

                                       17
<PAGE>
Diner's Acquisition Corporation
(A Development Stage Company)
Consolidated Statements of Cash Flows

<TABLE>
<CAPTION>
                                                             For The Period
                                                         from September 24, 2004
                                                             (Inception) to        Year Ended           Year Ended
                                                              December 31,         December 31,         December 31,
                                                                 2006                 2006                 2005
                                                              ----------           ----------           ----------
                                                                   $                   $                     $
<S>                                                           <C>                  <C>                  <C>
Cash Flows Used In Operating Activities
  Net loss                                                    (8,488,429)          (2,928,042)          (5,558,554)
  Adjustments to reconcile net loss to net cash provided
    by (used in) operating activities
      Depreciation and amortization                                  879                  558                  321
      Shares issued as compensation for services               5,896,901            1,516,750            4,380,151
      Shares issued for employee compensation                     10,000               10,000                   --
      Expense for employee stock options                         168,000              168,000                   --
      Debt conversion cost                                       707,283              707,283                   --
      Amount of beneficial conversion feature of
       convertible debt                                           50,000                   --               50,000
      Bad debt expense                                            50,087               50,087                   --
      Write-off of pre-acquisition payables                      (44,815)             (44,815)                  --
  Changes in operating assets and liabilities
      (Increase) decrease in accounts receivable                (116,787)             (44,250)              20,463
      (Increase) decrease in notes receivable                         --                   --               14,900
      (Increase) decrease in prepaid expenses and deposits          (182)                (182)                  --
      Increase (decrease) in accounts payable and accrued
       liabilities                                             1,207,551              472,984              734,567
      Increase (decrease) in deferred revenue                         --              (20,000)              20,000
                                                              ----------           ----------           ----------

Net Cash Provided by (Used in) Operating Activities             (559,512)            (111,627)            (338,152)
                                                              ----------           ----------           ----------
Cash Flows Used in Investing Activities
  Acquisition of furniture and computer equipment                 (3,156)                  --               (3,156)
  Restricted cash                                                 (2,990)              (2,990)
  Cash from acquisition of UltraGuard                              5,678                   --                5,678
                                                              ----------           ----------           ----------

Net Cash Provided by (Used) in Investing Activities                 (468)              (2,990)               2,522
                                                              ----------           ----------           ----------
Cash Flows From Financing Activities
  Proceeds from subscribed shares                                194,400               10,000              122,500
  Increase (decrease) in loans/notes from unrelated parties      276,644                1,644              225,000
  Proceeds from exercise of stock options                         89,480               89,480                   --
                                                              ----------           ----------           ----------

Net Cash Provided by (Used in) Financing Activities              560,524              101,124              347,500
                                                              ----------           ----------           ----------

Increase in Cash                                                     544              (13,493)              11,870

Cash - Beginning of the Period                                        --               14,037                2,167
                                                              ----------           ----------           ----------

Cash - End of the Period                                             544                  544               14,037
                                                              ==========           ==========           ==========
</TABLE>

           See accompanying notes to consolidated financial statements

                                       18
<PAGE>
Diner's Acquisition Corporation
(A Development Stage Company)
Consolidated Statement of Stockholders' Equity (Deficit)
From September 24, 2004 (Date of Inception) to December 31, 2006

<TABLE>
<CAPTION>
                                                                                      Deficit
                                                                                    Accumulated
                                                                   Additional       During the
                                     Issued           Common        Paid In         Development
                                     Shares           Stock         Capital            Stage             Total
                                  -----------       --------      -----------       -----------       -----------
                                       #                $              $                 $                 $
<S>                               <C>                <C>             <C>           <C>               <C>
BALANCE SEPTEMBER 24, 2004          6,160,625          6,161           55,739                --            61,900

Net loss for the period                                                                  (1,833)           (1,833)
                                  -----------       --------      -----------       -----------       -----------
BALANCE - DECEMBER 31, 2004         6,160,625          6,161           55,739            (1,833)           60,067

Common stock issued for cash           98,000             98          122,402                             122,500
Issuance of shares for
 consulting services                  942,587            943        4,367,308                           4,368,151
Issuance of shares for
 employee compensation                 10,000             10           11,990                              12,000
Adjustment for recapitalization
 of Reverse Merger (6/30/05)          121,805            122         (680,994)                           (680,872)
Amount of beneficial conversion
 feature of convertible debt                                           50,000                              50,000

Net loss for the period                                                              (5,558,554)       (5,558,554)
                                  -----------       --------      -----------       -----------       -----------
BALANCE DECEMBER 31, 2005           7,333,017          7,333        3,926,346        (5,560,387)       (1,626,708)

Common stock issued for cash            8,000              8            9,992                              10,000
Issuance of shares for
 consulting services                3,920,000          3,920        1,512,830                           1,516,750
Issuance of shares for debt        15,956,836         15,957        1,615,111                           1,631,068
Issuance of  shares for
 employee compensation                  8,000              8            9,992                              10,000
Value of stock options                     --             --          168,000                             168,000
Exercise of stock options             160,000            160           89,320                              89,480
Net loss for the period                                                              (2,928,042)       (2,928,042)
                                  -----------       --------      -----------       -----------       -----------
BALANCE - DECEMBER 31, 2006        27,385,853         27,386        7,331,591        (8,488,429)       (1,129,452)
                                  ===========       ========      ===========       ===========       ===========
</TABLE>

         See Accompanying Notes to the Consolidated Financial Statements

                                       19
<PAGE>
1. Reverse Acquisition, Nature of Operations and Continuance of Business

    On April 21,  2005,  the  Company's  Board of  Directors  met to  reorganize
    UltraGuard  Water Systems Corp (now Diner's  Acquisition  Corporation).  The
    Company  voted to change  its  business  focus  from  water  filtration  and
    disinfection to restaurant franchising.  On May 4, 2005, the Company filed a
    form PRE14A with the SEC,  calling a Special Meeting of the  shareholders to
    be held on June 13, 2005. At the meeting,  the  shareholders  approved by an
    88.65%  majority  vote, a proposal to change the  Company's  name to Diner's
    Acquisition Corporation ("Diner's") and by an 88.58% majority vote, to split
    the outstanding shares on a 1 for 100 basis. All per share amounts have been
    retroactively adjusted to reflect the reverse stock split.

    As part of the  reorganization,  on June 30,  2005,  the Board of  Directors
    finalized  details of the sale of UltraGuard  Water System's  filtration and
    disinfection  technologies and intellectual property to Innovative Fuel Cell
    Technologies  Inc (IFCT).  All shares of IFCT owned by the  Company  will be
    distributed as a dividend in kind to Company  shareholders of record on June
    12, 2005.  The number of IFCT shares  received by each  Company  shareholder
    will be pro-rata to the number of Company shares owned by the shareholder.

    On July 11, 2005, the Company's Board of Directors approved a share exchange
    agreement  between  shareholders  of the  Company and  Restaurant  Companies
    International,  Inc  ("RCI"),  a  Nevada  corporation.  RCI  is a  franchise
    development  company  organized on September  24, 2004 to  capitalize on the
    growing  demand for fast casual dining in North  America.  On July 11, 2005,
    the Company acquired, by way of reverse acquisition,  100% of the issued and
    outstanding  capital stock of RCI in exchange for the issuance of 30,802,367
    shares of the  Company's  common  shares.  Pursuant  to the  Agreement,  the
    Company's officers resigned.  As a result,  there was a change in control of
    the Company to the former shareholders of RCI.

    For financial accounting purposes, the acquisition was a reverse acquisition
    of the  Company  by RCI under the  purchase  method  of  accounting  and was
    treated as a  recapitalization  with RCI as the acquirer.  Accordingly,  the
    historical  financial  statements  have been restated after giving effect to
    the July 11,  2005  acquisition  of the  Company.  Consistent  with  reverse
    acquisition accounting:  (i) all of the Company's assets,  liabilities,  and
    accumulated deficit, are reflected at their combined historical cost (as the
    accounting  acquirer) and (ii) the  pre-existing  outstanding  shares of the
    Company (the accounting acquiree) are reflected at their net asset value.

    These  consolidated  financial  statements  have been prepared in accordance
    with United States  generally  accepted  accounting  principles,  on a going
    concern  basis,  which  contemplates  the  realization  of  assets  and  the
    satisfaction  of  liabilities  and  commitments  in  the  normal  course  of
    business.  As at June 30, 2005,  the  UltraGuard  Water Systems Corp has not
    recognized  significant  revenue, had a working capital deficit of $863,409,
    and had accumulated  operating  losses of $7,051,421  since  inception.  The
    combined  company has yet to generate  significant  revenue and will require
    additional  capital to do so. As of  December  31,  2006,  the Company had a
    working capital deficit of $1,131,728 and  accumulated  operating  losses of
    $8,488,428. The continuation of the Company is dependent upon the continuing
    financial support of creditors and stockholders and obtaining short-term and
    long-term  financing,  the completion of product  development  and achieving
    profitability.  These conditions raise substantial doubt about the Company's
    ability to continue as a going concern.  These  financial  statements do not
    include any adjustments that might arise from this  uncertainty.  Management
    is  attempting  to raise debt and equity  capital  and use the  proceeds  to
    develop  restaurant  concepts  and explore  acquisitions  of other  existing
    restaurant concepts. However, there is no assurance that the Company will be
    successful in executing its business plan.

    On September 21, 2006, the Company's  Board of Directors  approved a one for
    five (1:5) reverse split of the Company's  common stock,  an increase in the
    Company's  authorized shares from 100 million to 200 million,  to change the
    Company's  name to Diner's  Acquisition  Corp.,  and  authorized  10 million
    shares of a new class of Preferred  Series stock at $10 per shares  having a
    conversion  rate of one  preferred  share into four  common  shares and each
    share paying a dividend of 10% APR. Shareholders  representing a majority of
    84.5% of the shares outstanding have voted in favor of the Boards decision.

2. Significant Accounting Policies

    CONSOLIDATED FINANCIAL STATEMENTS

    These financial  statements include the accounts of the Company and RCI. All
    significant inter-company transactions and balances of the subsidiaries, Q's
    Franchise  Company  and  Fit  `N  Healthy  Franchise   Company,   have  been
    eliminated.

                                       20
<PAGE>
    On July 11, 2005 ("the acquisition date"),  Diner's Acquisition  Corporation
    ("Diner's")  acquired all of the outstanding  stock of Restaurant  Companies
    International,  Inc ("RCI").  For accounting  purposes,  the acquisition was
    treated as the  acquisition  of  Diner's  by RCI with RCI as the  accounting
    acquirer  (reverse  acquisition).  As a  result,  the  historical  financial
    statements  prior to the acquisition date are those of RCI from July 1, 2005
    (date of inception of RCI).

    CASH AND CASH EQUIVALENTS

    Cash and cash  equivalents  include  cash on hand,  in banks and all  highly
    liquid investments with maturity of three months or less when purchased.

    PROPERTY AND EQUIPMENT

    Property and equipment are recorded at cost.  Depreciation  is computed on a
    straight-line  method  using an  estimated  useful  life of five  years  for
    furniture and three years for computer equipment.

    REVENUE RECOGNITION

    The Company  recognizes  revenue in accordance  with Securities and Exchange
    Commission Staff Accounting Bulletin No. 104, "Revenue Recognition." Revenue
    will be recognized only when the price is fixed or determinable,  persuasive
    evidence  of  an  arrangement   exists,   the  service  is  performed,   and
    collectibility is reasonably  assured.  Deferred revenue represents deposits
    received  for the  development  of  restaurants  sites.  Those  deposits are
    recognized as revenue when the respective stores open.

    ESTIMATES AND ASSUMPTIONS

    The  preparation  of  financial  statements  in  conformity  with  generally
    accepted accounting principles used in the United States requires management
    to make estimates and assumptions that affect the reported amounts of assets
    and liabilities in the financial  statements and accompanying  notes. Actual
    results could differ from these estimates.

    BASIC AND DILUTED NET INCOME (LOSS) PER SHARE

    The Company computes net income (loss) per share in accordance with SFAS No.
    128,  "Earnings per Share".  This statement  requires  presentation  of both
    basic  and  diluted  earnings  per  share  (EPS) on the  face of the  income
    statement.  Basic EPS is computed by dividing net income (loss) available to
    common  shareholders  (numerator)  by the weighted  average number of common
    shares outstanding (denominator) during the period. Diluted EPS gives effect
    to all  dilutive  potential  common  shares  outstanding  during  the period
    including  stock options,  using the treasury stock method,  and convertible
    preferred stock,  using the if-converted  method.  In computing diluted EPS,
    the average stock price for the period is used in determining  the number of
    shares  assumed  to be  purchased  from the  exercise  of stock  options  or
    warrants.  The convertible debt of $50,000 plus interest is convertible into
    44,000 shares at December 31, 2006.  These potential common shares have been
    excluded   from  the   diluted  EPS   calculation   because  the  effect  is
    anti-dilutive. The debt was not converted to shares as of December 31, 2006.

    ACCOUNTING FOR STOCK-BASED COMPENSATION

    The Company  accounts for stock based  compensation  in accordance with SFAS
    No. 123, "Accounting for Stock-Based  Compensation." This statement requires
    that stock awards  granted  subsequent  to January 1, 1995, be recognized as
    compensation  expense  based on  their  fair  value  at the  date of  grant.
    Alternatively,  a  company  may  account  for  granted  stock  awards  under
    Accounting  Principles  Board  Opinion (APB) No. 25,  "Accounting  for Stock
    Issued to Employees," and disclose pro forma income amounts which would have
    resulted from recognizing such awards at their fair value.  Prior to January
    1, 2006 the Company  elected to account  for  stock-based  compensation  for
    employees  under APB No. 25 and make the required pro forma  disclosures for
    compensation  expense in accordance with SFAS No. 123. The Company  accounts
    for stock issued for services to  non-employees  in accordance with SFAS No.
    123.  Compensation  expense is based on the fair  market  value of the stock
    award or fair market value of the goods and services  received  whichever is
    more reliably measurable.

    Effective  January 1, 2006,  the  Company  adopted  Statement  of  Financial
    Accounting  Standards No. 123 (revised  2004),  Share-Based  Payment  ("SFAS
    123R"),  which requires the Company to measure the cost of employee services
    received in exchange for all equity awards granted  including  stock options
    based on the fair market value of the award as of the grant date.  SFAS 123R
    supersedes  Statement of Financial  Accounting Standards No. 123, Accounting
    for Stock-Based  Compensation  ("SFAS 123") and Accounting  Principles Board
    Opinion No. 25,  Accounting  for Stock Issued to Employees  ("APB 25").  The
    Company  has  adopted  SFAS 123R  using  the  modified  prospective  method.
    Accordingly, prior period amounts have not been restated. Under the modified
    prospective  method,  stock  options  awards that are  granted,  modified or

                                       21
<PAGE>
    settled  after  December 31, 2005 will be valued at fair value in accordance
    with  provisions  of SFAS 123R and  recognized on a straight line basis over
    the  service  period  of  the  entire  award.  At  December  31,  2005,  all
    outstanding stock options were fully vested.

    No stock  options  were  granted to employees in fiscal 2005 and the Company
    issued  160,000  options to one  employee  who was fully  vested  during the
    quarter  ending  March 31 2006.  In  accordance  with SFAS No. 123  (revised
    2004),  the Black  Scholes  Method was used in valuing the options that were
    granted.  Through  the Black  Scholes  Method,  it was  determined  that the
    160,000  options were valued at $168,000.  The following table indicates the
    input values used. All options were fully vested when granted.

                                                                   Weighted
                                                                    Average
                                 Stock Price    Option Shares    Exercise Price
                                 -----------    -------------    --------------
     Balance, December 31, 2005                          0           $0.00
       Granted                      $0.55          160,000           $0.55
       Exercised                    $1.10          160,000           $0.55
       Expired, or Terminated                            0           $0.00
     Balance, December 31, 2006                          0           $0.00

                                                    2006             2005
                                                   ------           ------
     Exercisable at the end of the year                  0               0
     Weighted average fair value of
      each option granted during the year          $  1.05           $0.00
     Intrinsic value of the options
      when exercised                               $88,000           $0.00

    There are no options outstanding and exercisable as of December 31, 2006.

    LONG-LIVED ASSETS

    SFAS No. 144,  "Accounting  for the  Impairment  or  Disposal of  Long-Lived
    Assets"  establishes a single  accounting model for long-lived  assets to be
    disposed of by sale  including  discontinued  operations.  SFAS 144 requires
    that these long-lived assets be measured at the lower of the carrying amount
    or fair value less cost to sell,  whether reported in continuing  operations
    or discontinued operations.

    FINANCIAL INSTRUMENTS

    The fair  value of cash,  accounts  receivable,  accounts  payable,  accrued
    liabilities and amounts owing to related parties approximates their carrying
    value  due to the  immediate  or  short-term  maturity  of  these  financial
    instruments. The Company is not exposed to significant interest, currency or
    credit risks arising from these financial instruments.

    CONCENTRATION OF CREDIT RISK

    Financial  instruments that  potentially  subject the Company to credit risk
    consist  principally of cash.  Cash was deposited with a high credit quality
    institution.

    RECENT ACCOUNTING PRONOUNCEMENTS

    In December 2004, FASB issued SFAS No. 153, "EXCHANGES OF NONMONETARY ASSETS
    - AN  AMENDMENT  OF APB OPINION NO. 29". The guidance in APB Opinion No. 29,
    "ACCOUNTING  FOR NONMONETARY  TRANSACTIONS",  is based on the principle that
    exchanges of  nonmonetary  assets should be measured based on the fair value
    of the assets  exchanged.  The guidance in that Opinion,  however,  included
    certain exceptions to that principle.  SFAS No. 153 amends Opinion No. 29 to
    eliminate  the  exception for  nonmonetary  exchanges of similar  productive
    assets and replaces it with a general exception for exchanges of nonmonetary
    assets that do not have  commercial  substance.  A nonmonetary  exchange has
    commercial  substance if the future cash flows of the entity are expected to
    change significantly as a result of the exchange. The provisions of SFAS No.
    153 are  effective  for  nonmonetary  asset  exchanges  occurring  in fiscal
    periods  beginning after June 15, 2005.  Early  application is permitted and
    companies  must  apply the  standard  prospectively.  The  adoption  of this
    standard is not expected to have a material effect on the Company's  results
    of operations or financial position.

    In June 2006, the FASB issued FASB  Interpretation  No. 48,  "Accounting for
    Uncertainty in Income Taxes - an  interpretation  of FASB Statement No. 109"
    ("FIN 48"),  which  clarifies the accounting for uncertainty in income taxes
    recognized in an enterprise's  financial  statements in accordance with SFAS
    No. 109,  "Accounting  for Income  Taxes." FIN 48  prescribes a  recognition

                                       22
<PAGE>
    threshold and measurement  attribute for the financial statement recognition
    and  measurement  of a tax  position  taken or expected to be taken in a tax
    return. FIN 48, which is effective for fiscal years beginning after December
    15, 2006, also provides guidance on derecognition,  classification, interest
    and penalties,  accounting in interim periods,  disclosure,  and transition.
    The Company  plans on  reviewing  in detail its tax  situation  to determine
    whether there are any uncertain tax positions but does not presently believe
    that there are any material such matters.

    In  September  2006,  the  FASB  issued   Statement  No.  157,  "Fair  Value
    Measurements" ("FASB No. 157"). FASB No. 157 defines fair value, establishes
    a  framework  for  measuring  fair value in  generally  accepted  accounting
    principles  (GAAP), and expands  disclosures about fair value  measurements.
    FASB No. 157 applies under other accounting  pronouncements  that require or
    permit fair value  measurements,  the FASB having  previously  concluded  in
    those accounting  pronouncements that fair value is the relevant measurement
    attribute.  Accordingly,  this Statement does not require any new fair value
    measurements.

    In September  2006,  the  Securities  and Exchange  Commission  issued Staff
    Accounting  Bulletin  No.  108,   Considering  the  Effects  of  Prior  Year
    Misstatements  when  Quantifying  Misstatements  in Current  Year  Financial
    Statements  ("SAB 108").  SAB 108 provides  guidance on consideration of the
    effects  of  prior  year   misstatements   in   quantifying   current   year
    misstatements  for  the  purpose  of a  materiality  assessment.  SAB 108 is
    effective for fiscal years ending after  November 15, 2006.  The adoption of
    SAB 108 did not have an impact on our consolidated financial statements.

    In  December  2006,  the FASB  issued  FASB  Staff  Position  EITF  00-19-2,
    Accounting for Registration Payment  Arrangements ("FSP EITF 00-19-2").  FSP
    EITF  00-19-2  specifies  that  the  contingent  obligation  to make  future
    payments or otherwise transfer  consideration  under a registration  payment
    arrangement,  whether  issued  as a  separate  agreement  or  included  as a
    provision of a financial instrument or other agreement, should be separately
    recognized and measured in accordance  with FASB Statement No. 5, Accounting
    for Contingencies. A registration payment arrangement is defined in FSP EITF
    00-19-2 as an arrangement  with both of the following  characteristics:  (1)
    the  arrangement  specifies  that the  issuer  will  endeavor  (a) to file a
    registration  statement  for the resale of specified  financial  instruments
    and/or for the resale of equity  shares that are issuable  upon  exercise or
    conversion  of specified  financial  instruments  and for that  registration
    statement to be declared  effective  by the US SEC within a specified  grace
    period,  and/or  (b) to  maintain  the  effectiveness  of  the  registration
    statement  for a specified  period of time (or in  perpetuity);  and (2) the
    arrangement   requires   the  issuer  to  transfer   consideration   to  the
    counterparty if the  registration  statement for the resale of the financial
    instrument  or  instruments  subject  to the  arrangement  is  not  declared
    effective  or  if  effectiveness  of  the  registration   statement  is  not
    maintained.   FSP  EITF  00-19-2  is  effective  for  registration   payment
    arrangements  and the financial  instruments  subject to those  arrangements
    that are entered  into or modified  subsequent  to December  21,  2006.  For
    registration payment arrangements and financial instruments subject to those
    arrangements  that  were  entered  into  prior to the  issuance  of FSP EITF
    00-19-2,  this  guidance is effective for  financial  statements  issued for
    fiscal years  beginning  after December 15, 2006, and interim periods within
    those  fiscal  years.  We do not expect the  adoption of FSP EITF 00-19-2 to
    have a material impact on our consolidated financial statements.

    In February  2007,  the FASB issued SFAS No. 159,  The Fair Value Option for
    Financial  Assets and  Financial  Liabilities  ("SFAS  159")  which  permits
    entities to choose to measure many financial  instruments  and certain other
    items at fair value that are not  currently  required to be measured at fair
    value.  SFAS  159  will be  effective  for us on  January  1,  2008.  We are
    currently  evaluating  the  impact  of  adopting  SFAS 159 on our  financial
    position, cash flows, and results of operations.

    Loss Contingencies

    The Company  estimates a loss  contingency  in accordance  with Statement of
    Financial Accounting Standards ("SFAS" No. 5 "Accounting for Contingencies".
    The Company accrues the loss by a charge to income when there is information
    available that it is probable that an asset has been impaired or a liability
    has been incurred and the amount of the loss can be reasonably estimated.

    GOODWILL AND OTHER INTANGIBLES

    In July 2001,  the Financial  Accounting  Standards  Board  ("FASB")  issued
    statement of Financial Accounting Standards No. 142 ("SFAS 142"),  "Goodwill
    and Other Intangible  Assets," which is effective for fiscal years beginning
    after December 15, 2001. SFAS 142 prohibits the amortization of goodwill and
    intangible  assets with  indefinite  useful  lives but  requires  that these
    assets be reviewed for  impairment at least  annually or on an interim basis
    if an event occurs or  circumstances  change that could  indicate that their
    value has diminished or been impaired. Other intangible assets will continue
    to be amortized over their estimated useful lives. In addition, the standard
    includes provisions for the  reclassification of certain existing recognized
    intangibles  as  goodwill,  reassessment  of the  useful  lives of  existing
    recognized  intangibles,  reclassification  of  certain  intangibles  out of

                                       23
<PAGE>
    previously  reported goodwill and the  identification of reporting units for
    purposes of assessing potential future impairments of goodwill.

    INCOME TAXES

    Potential  benefits of income tax losses are not  recognized in the accounts
    until  realization is more likely than not. The Company has adopted SFAS No.
    109 "Accounting for Income Taxes" as of its inception.  Pursuant to SFAS No.
    109, the Company is required to compute tax asset benefits for net operating
    losses carried forward.  Potential  benefit of net operating losses have not
    been recognized in these financial  statements because the Company cannot be
    assured it is more likely than not it will utilize the net operating  losses
    carried forward in future years.

3. Property and Equipment

    Property and equipment is stated at cost less accumulated depreciation.

                                                      December 31,  December 31,
                                                         2006          2005
                                        Accumulated     Net Book      Net Book
                                Cost    Depreciation     Value         Value
                                ----    ------------     -----         -----
                                 $           $             $             $
    Property and equipment     3,156        880          2,277         2,835
                               =====        ===          =====         =====

4. Loans Payable

     a)   Prior to the merger Restaurant Companies  International,  Inc. entered
          into a note payable  agreement  totalling  $100,000 signed on April 2,
          2005, for $100,000 principal with 8% interest per annum and matures in
          one year. Interest is accrued and payable quarterly.  Additional terms
          included  the issuance of 5% of the issued and  outstanding  shares of
          the membership  interest of Q's Franchise Company,  LLC with an option
          to  convert  the  sums  due  to an  additional  5% of the  issued  and
          outstanding shares of the membership  interest.  The holder shall also
          receive 13,333 shares of the common stock of the Company.

     b)   On August 15, 2005, a debenture payable totalling $50,000 was acquired
          with the  purchase  of Fit & Healthy,  a  restaurant  concept  with no
          operations  with  quarterly  interest of $1,250.  Principal was due on
          December 1, 2005.  The holder has the option to convert all or part of
          the principal amount and accrued interest into common stock, par value
          $0.001 per share at a price per share  equal to 50% of the closing bid
          price of the common stock on the date that the company receives notice
          of  conversion.  The Company  recognized  the value of the  beneficial
          conversion  feature as $50,000.  Since the obligation matured in 2005,
          the full amount of the discount was  amortized as interest  expense in
          the year ended  December 31, 2005. The Company is currently in default
          of this  debenture as no payments of interest or  principal  have been
          made.  Interest will continue to accrue until the debenture is paid or
          converted into common stock.

     c)   On November 8, 2005, a note payable totalling $100,000 and bearing 12%
          interest per annum was received. Principal is due on November 6, 2006.
          Interest is accrued  and  payable on November 6, 2006.  The Company is
          currently  in  default  of this note as no  payments  of  interest  or
          principal  have been made.  Interest will continue to accrue until the
          note is settled.

     d)   On December  1, 2005,  a cash  advance  totalling  $25,000  bearing no
          interest  was  received.  The  principal of $25,000 was due in January
          2006.  The principal was repaid by a related party on behalf of Diners
          Acquisition  and  converted  to a cash  advance  owing to the  related
          party.  The cash advance has now been settled by the issuance of stock
          for the debt.

     e)   In January  2006,  three notes payable  totalling  $6,900 and in March
          2006, one note payable of $200 were received  bearing 10% interest per
          annum. Principal and interest are payable on demand.

     f)   In June 2006, a note payable totalling $8,000 and bearing 12% interest
          per annum was received. Principal and interest are payable on demand.

     g)   In December 2006, amounts owing to a former employee were converted to
          a non-interest  bearing note payable for $11,535.  The note is payable
          on demand.

                                       24
<PAGE>
<TABLE>
<CAPTION>
             Type             Description            Date       Principal     Interest      Due Date
             ----             -----------            ----       ---------     --------      --------
<S>      <C>              <C>                     <C>           <C>          <C>            <C>
          Note Payable     Dr. Jeffrey Martin      4/2/2005     $100,000      8%/Annum      7/2/2006
          Debenture        John Payne              8/15/2005    $ 50,000      10%/Annum     12/1/2005
          Note Payable     TH & TW LLC             11/8/2005    $100,000      12%/Annum     11/8/2006
          Note Payable     Kenneth Fielding        1/26/06      $  7,100      10%/Annum     On demand
          Note Payable     Roger Enfield           6/26/06      $  8,000      12%/Annum     On demand
          Note Payable     Curtis Patterson        12/31/06     $  11,535     None          On demand
</TABLE>

5. Amounts Owing to Related Parties

    Unpaid wages,  consulting and loans amounting to $555,607 owed to two former
    officers and current directors and their related companies, 659999 BC, Ltd.,
    Integrated  Industries,  and UV  Systems  Technology,  are  due  on  demand,
    unsecured, and will bear interest calculated at 10% effective April 1, 2005.
    Included in this amount of $447,468  are amounts  owing to the  President of
    the Company as a result of loans,  management fees and expenses amounting to
    $35,873 advanced during the period ending December 31, 2005. In fiscal 2003,
    two officer  directors were issued 24,000 shares of common  restricted stock
    of the Company at $3.38 per share  totalling  $81,120 for partial payment of
    amounts  owing.  During this fiscal  period,  on June 8, 2005  officers  and
    directors were issued 18,420 shares from the 2004 Incentive Plan of Creative
    at $1.00,  the current market price on the date of issue was charged against
    the amounts  payable to these  officers  and  directors.  On April 29, 2005,
    25,872 of restricted stock were issued at $0.70 to settle $18,110 debt owing
    to a company managed by two officers and directors. Advances to the officers
    and  directors  totalling  $108,139 have been applied to the amount owing to
    reduce the  payable to  $447,469.  These  amounts  were  converted  to notes
    payable  bearing  10%  interest in July 2005.  These  notes and  outstanding
    payables  to the  former  officers  have been  settled  by the  issuance  of
    9,522,538 shares on September 21, 2006 to settle the total debt and interest
    of $511,513.

6. Common Stock

     a)   Stock Split

          On June 13,  2005,  the  Board  of  Directors  approved  a one for one
          hundred  reverse stock split of common shares.  The Company issued one
          share for each one hundred  common shares  outstanding  effective June
          13, 2005.  All per share amounts have been  retroactively  adjusted to
          reflect  the reverse  stock  split.  The number of shares  outstanding
          pre-reverse  split was 60,891,806.  After giving effect to the reverse
          split the outstanding shares totalled 609,021.

          On September 21, 2006, the Board of Directors  approved a one for five
          reverse stock split of common shares. The Company issued one share for
          each five common shares outstanding  effective September 21, 2006. All
          per share  amounts  have been  retroactively  adjusted  to reflect the
          reverse  stock  split.  The number of shares  outstanding  pre-reverse
          split was  93,974,913.  After giving  effect to the reverse  split the
          outstanding shares totalled 18,795,136.

     b)   On November 26, 2003,  the Company  adopted The  Incentive  Plan ("the
          Plan") that was registered with the Securities  Exchange Commission on
          December  1, 2003 on Form S-8.  Under the Plan,  the Company may issue
          5,000,000  shares of common  stock or grant  options.  During the year
          ended  December  31, 2004,  the Company  issued all  remaining  shares
          pursuant to the Plan.

     c)   Independents Contractors/Consulting Plan

          On   July   27,   2005   the   Company    adopted   the    Independent
          Contractors/Consulting  Plan (the "Plan"). Under the Plan, the Company
          may issue 5,000,000 common shares or grant options. The Company issued
          all remaining shares pursuant to the Plan.

          On February 9, 2006 the Company  adopted the  Qualified  Stock  Option
          Plan (the  "Plan").  Under the Plan,  the Company may issue  5,000,000
          common  shares or grant  options.  The value of the shares  granted is
          determined based on the trading price of the company's common stock at
          the date of grant.  The Company issued 160,000 options to one employee
          during the quarter  ending  March 31, 2006.  The Company  expensed the
          fair value of the options of  $168,000 in the quarter  ended March 31,
          2006. The options  vested  immediately  and were exercised  within the
          period. There are no options outstanding at December 31, 2006.

                                       25
<PAGE>
          On July 18, 2006 the Company  adopted the 2006 Incentive Plan allowing
          the Company to issue 10,000,000 common shares or grant options.

     d)   Issuance of S-8 Common Shares

          During the fiscal period ending  December 31, 2006 the Company  issued
          S-8 shares for consulting services. The value of the shares granted is
          determined based on the trading price of the Company's common stock at
          the date of grant. The shares issued are in the following table:


           Date Granted             Number of Shares         Value
           ------------             ----------------         -----
          January 5, 2006                296,000             $1.00
          April 5, 2006                  104,000             $1.00
          April 7, 2006                    8,000             $1.10
          August 2, 2006                  40,000             $0.90
          May 8, 2006                     60,000             $1.05
          May 16, 2006                    12,000             $1.10
          May 26, 2006                    50,000             $0.93
          May 30, 2006                   100,000             $1.08
          June 5, 2006                   100,000             $0.95
          October 23, 2006             2,000,000             $0.25

          Issuance of Restricted Common Shares

          During the fiscal period ending  December 31, 2006 the Company  issued
          restricted  shares to three consultants for consulting  services,  one
          accredited   investor   through  the   Company's   Private   Placement
          Memorandum,  and to four  creditors  in  settlement  of  debts  in the
          following amounts:

          January 5, 2006                 50,000
          January 20, 2006                 8,000
          August 23, 2006              2,662,770
          September 21, 2006           7,803,349
          October 20, 2006             1,719,189
          October 23, 2006               500,000
          December 5, 2006               600,000
          December 11, 2006            3,771,528

          In February  2006,  the Company  sold 40,000  shares of is  restricted
          common stock through a Private Placement  Memorandum to one accredited
          investor at $.25 per share.  Each share purchased carried a warrant to
          purchase  an  additional  share at $.50 per  share.  Post five for one
          (5:1) stock split the shares sold currently represent 8,000 shares

          Valuation of Common Stock Issued for Services and Assets

          The Company applies EITF 96-18 "Accounting for Equity Instruments that
          are issued to Other Than  Employers for  Acquiring,  or in Conjunction
          with Selling,  Goods or Services",  in accounting for shares issued to
          consultants.  The values of these shares were based on calculating the
          fair market value of the stock and the services provided.

                                       26
<PAGE>
          During  the year  ending  December  31,  2006 the  Company  issued the
          following common shares:

<TABLE>
<CAPTION>
                                                                         Weighted
                                                                         Average
                                                                       Fair Market
                                                          Shares          Value         Total
                                                          Issued        Per Share     Fair Value
                                                          ------        ---------     ----------
                                                            #               $             $
<S>                                                     <C>            <C>            <C>
          Consulting services provided pursuant to
           incentive plan (Note 6c)                     2,770,000         $0.46        1,269,750
          Consulting services provided pursuant to
           144 restricted shares (Note 6d)              1,150,000         $0.21          247,000
                                                        ---------         -----        ---------

                                                        3,920,000                      1,516,750
                                                        =========                      =========
</TABLE>

7. Segmented Information

    As a  result  of the  disposition  of  UltraGuard,  UltraGuard  and IFCT now
    operate  in one  business  segment  and one  geographical  area.  All of the
    Company's identifiable assets are located in the United States.

8. Legal Proceedings/Contingency Accrual

     a)   On April 25, 2003, Chelverton Fund Limited filed a suit in the Supreme
          Court of British  Columbia against the Company for non-payment of debt
          in the amount of $155,000. The Company entered an appearance,  filed a
          defense  against this claim,  and attempted to negotiate a settlement.
          Chelverton filed additional information that supported their claim and
          the Company  responded  with a "no defines"  position and judgment was
          issued in the amount of $193,944 (Cnd$234,642)  including interest and
          legal costs. On April 5, 2004 the Company appeared in Supreme Court to
          provide to Chelverton and the court specific information pertaining to
          the  Company's  assets and its ability to pay the  judgment  including
          interest.  The Company was  required  to and has  provided  additional
          detailed financial  information.  In December 2006 Chelverton accepted
          3,771,528 shares of the Company's  restricted common stock in exchange
          for the settlement of the debt.

     b)   The  Company  has made a  provision  for a loss of  $27,000 in a claim
          filed with the British Columbia Labor Relations (LRB) Board, made by a
          former employee for wrongful dismissal. The loss amount was the amount
          determined by the LRB. This amount represented the total probable loss
          of the lawsuit and has been  recorded  as an accrued  liability  as of
          December 31, 2004 and 2003.  On October 20, 2005 the employee  filed a
          lawsuit in the Supreme Court of British  Columbia  against the Company
          and a former  subsidiary;  UV Systems  Technology  Inc whom the former
          employee was  employed by,  claiming  wrongful  dismissal.  UV Systems
          Technology  Inc has filed a  Statement  of  Defense.  Counsel  for the
          former  employee  informed the Company that counsel would be filing an
          amended Statement of Claim. The amount of the claim is for one year of
          salary,  which would represent  CAN$90,000  (US$77,193)  including the
          $27,000  determined  for  the  LRB.  Subsequent  to the  year-end,  on
          February 28, 2006, the Company  appeared in BC Supreme Court at a Rule
          18A  hearing at which the lawyers  for the  plaintiff  and the Company
          each presented  evidence to the Court. The Judge reserved his decision
          on the matter  until  April  2006.  In April  2006 the Judge  found in
          favour of the Company.  The plaintiff has since appealed.  The Company
          anticipates a response,  regarding  the appeal,  from the Court before
          May 2007.

     c)   On October 4, 2005,  the Company  completed a Purchase  Agreement with
          Franchise  Capital  Corporation.   Diner's  purchased  from  Franchise
          Capital its  interest in  Kokopelli  Sonoran  Grill,  Comstock  Jakes,
          Cousin Vinnie's Italian Diner, and Kirby Foo's Asian Grill. As per the
          Agreement,  Diner's will pay  $200,000  cash and  3,583,667  shares of
          Diner's  common  stock.  The  Company  has not paid the cash,  but has
          funded  approximately  $150,000 of the Kokopelli  and Comstock  Jake's
          operations.  Within the three  months  ending  September  30, 2006 the
          Company  received  80,000 shares of  restricted  common stock in Great
          American Food Chain in exchange for its  investment in Kokopelli.  The
          Company is seeking to acquire Comstock Jake's from its creditors.

                                       27
<PAGE>
     d)   On December 29, 2005,  the Company and Franchise  Capital  Corporation
          agreed to rescind the October  Purchase  Agreement  and entered into a
          Funding  Agreement.  The Company intended to provide Franchise Capital
          Corporation  with a total  $600,000  in funding for the  operation  of
          Kokopelli and Comstock.  The Company had funded approximately $150,000
          and had agreed to fund the  balance  of  approximately  $450,000  with
          monthly payments of $100,000 beginning January 25, 2006. In return for
          the funding of operation for Kokopelli and Comstock Jake's,  Franchise
          Capital  Corporation  was to pay the Company an amount equal to 50% of
          the profits Franchise Capital Corporation  receives from its ownership
          in Kokopelli and Comstock Jake's for the periods commencing on July 1,
          2006 and ending on June 30, 2011. If the Company failed to provide the
          full amount of funding but at least $300,000, the profit payments will
          be reduced to 25%. If the Company  failed to provide at least $300,000
          of  funding,  then the  Franchise  Capital  Corporation  will  have no
          obligation to pay any profit payments to the Company.  The Company did
          fail on its  obligation.  As a result of the default,  the Company has
          released  all  claims  it may  have  related  to  Kokopelli  Franchise
          Company, and Franchise Capital  Corporation.  However, the Company did
          receive  80,000  shares of restricted  common stock in Great  American
          Food Chain for its investment in Kokopelli.  Great American Food Chain
          acquired Kokopelli from Franchise Capital Corporation.

     e)   On  November  1, 2005 the  Company's  board of  directors  approved  a
          purchase  agreement  with  Pasta  Pranzo,  LLC.  The  members of Pasta
          Pranzo, LLC approved the purchase agreement on the same date. The date
          to close the purchase was set for January 1, 2006.  The property to be
          acquired was the Pasta Pranzo System  including,  without  limitation,
          the Marks and Recipes of their California  operation.  Pursuant to the
          terms of the  purchase  agreement,  $300,000  in common  shares of the
          Company  and  a  note  for  $300,000  was  to  be  exchanged  for  the
          aforementioned assets. Said shares shall be restricted.  The principal
          followed in determining  the amount of  consideration  given was based
          upon the  current  value and  future  revenue  streams  and the market
          exposure  in  relation  to the  Company's  current  position  and  the
          restrictive nature of the stock.

          On December 28, 2005, the Company  rescinded the agreement,  cancelled
          the issuance for $300,000 common shares,  and cancelled the promissory
          note for  $300,000,  effective the same day. The Company was unable to
          secure the required financing to close on the purchase agreement.

9. Business Combination

    The  Company  valued the  transaction  to acquire  Ultra  Guard based on the
    estimated fair value of the assets acquired at June 30, 2005.  Ultra Guard's
    common  stock  issued  in  the  transaction  is  thinly  traded  and  it was
    determined that the estimated fair value of the net assets transferred was a
    better  indicator of the value of the  transaction.  Neither Ultra Guard nor
    RCI had any  significant  operations at the time of the  transaction.  Ultra
    Guard had a net deficit of $680,872 at  acquisition as the current assets of
    $118,801 were acquired along with the liabilities  totalling  $799,672.  The
    Company  determined that the book value of the net assets  approximated fair
    value in that  most were  current  assets  and  liabilities  expected  to be
    settled in the near term.  Because  the  liabilities  assumed  exceeded  the
    assets acquired,  the difference is recorded as charge to additional paid in
    capital.

     UltraGuard Water Systems              June 30, 2005
     ------------------------              -------------
     CURRENT ASSETS
       Cash                                   $   5,678
       Accounts receivable                        4,645
       Notes receivable                         103,710
       Prepaid expenses and deposits              4,768

     TOTAL CURRENT ASSETS                     $ 118,801

     CURRENT LIABILITIES
       Accounts payable                         178,078
       Accrued liabilities                      426,404

     TOTAL CURRENT LIABILITIES                $ 604,482

     OTHER LIABILITIES                          195,190

     TOTAL LIABILITIES                          799,672

     DIFFERENCE                                (680,872)

                                       28
<PAGE>
10. Income Taxes

    Deferred  income taxes reflect the net tax effects of temporary  differences
    between  the  carrying  amounts  of assets  and  liabilities  for  financial
    reporting purposes and the amounts used for income tax purposes. The Company
    has a deferred  income tax asset of $1,145,000 as of December 31, 2006.  The
    net  deferred  income  tax  asset  has been  reduced  in its  entirety  by a
    valuation  allowance.  No  provision  or benefit  for income  taxes has been
    reported in the  accompanying  statements  of  operations  since any current
    income tax benefit  would be offset by an equal  increase  in the  valuation
    allowance.  The valuation  allowance  decreased by  $1,077,000  for the year
    ended December 31, 2006. The valuation allowance for the year ended December
    31, 2005 was  $2,222,000.  There were no material tax effects for the period
    from September 24, 2004 (date of inception) through December 31, 2004.

    The net income tax  provision  for the years  ended  December  31,  2006 and
    December 31, 2005 was as follows:

                                                       2006              2005
                                                    ---------         ---------

    Current benefit                                 $(442,000)        $(428,000)

    Deferred benefit (provision)                      442,000           428,000
                                                    ---------         ---------
    Net income tax provision                        $       0         $       0
                                                    =========         =========

    The components of the deferred  income tax asset as of December 31, 2006 are
    as follows:

    Difference in stock based compensation                          $   714,000
    Difference in accruals                                               50,000
    Difference in accounts receivable                                   (34,000)
    Net operating loss carryforward                                     442,000
                                                                    -----------
    Deferred income tax asset                                         1,145,000
    Valuation allowance                                              (1,145,000)
                                                                    -----------
                                                                    $         0
                                                                    ===========

    A  reconciliation  of the  differences  between the  statutory and effective
    income tax rates for the years ended December 31, 2006 and December 31, 2005
    was as follows:

                                      2006                        2005
                               --------------------      ---------------------
                                  Amount        %           Amount         %
                               ----------    ------      -----------    ------
    Federal statutory rates    $ (995,534)   (34.00)     $(1,889,908)   (34.00)
    State income taxes - net
    of federal benefit           (175,683)    (6.00)        (333,513)    (6.00)
    Valuation allowance         1,144,830     39.10        2,222,154     39.08
    Other                               0       .00            1,268       .02
                               ----------    ------      -----------    ------
    Effective rate             $        0         0      $         0         0
                               ==========    ======      ===========    ======

    The total net operating loss carryforward of approximately  $1,104,000 as of
    December 31, 2006, for both federal and state  purposes,  begins expiring in
    2026 and 2011, respectively.

11. Subsequent Events

    On February  7, 2007 the Company  announced  that they have  entered  into a
    letter of intent to acquire  Lucky  Lou's  restaurants  based in the Greater
    Phoenix area. As per the terms of the Agreement,  Diner's will acquire Lucky
    Lou's  through a Preferred  Share  exchange  agreement  with the partners of
    Lucky  Lou's.  Diner's  has  already  begun its due  diligence  process  and
    anticipates a closing of the transaction shortly.

                                       29
<PAGE>
ITEM 8.  CHANGES  IN  AND  DISAGREEMENTS  WITH  ACCOUNTANTS  ON  ACCOUNTING  AND
         FINANCIAL DISCLOSURE

None

ITEM 8A. CONTROLS AND PROCEDURES

As at the  end of the  period  covered  by  this  report,  the  Company's  Chief
Executive  Officer and Chief Financial  Officer carried out an evaluation of the
effectiveness of the design and operation of the Company's disclosure.  Based on
the  evaluation,  the  Chief  Executive  Officer  and  Chief  Financial  Officer
concluded  that,  as at the  end of the  period  covered  by  this  report,  the
Company's  disclosure  controls  and  procedures  are  effective  to ensure that
information required to be disclosed in the reports that we file or submit under
the Exchange Act is recorded, processed, summarized and reported within the time
periods  specified  in the  Commission's  rules and  forms  and to  ensure  that
information required to be disclosed by us in the reports that we file or submit
under the  Exchange  Act is  accumulated  and  communicated  to our  management,
including our principal  executive and principal  financial officer,  or persons
performing similar functions, as appropriate to allow timely decisions regarding
disclosure.

                                    PART III

ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS

The Executive Officers and Directors of the Company are as follows:

         Name                    Position                Age
         ----                    --------                ---
     Scott Campbell         President, Director          47
     Frank Holdraker        Chairman                     62
     Ken Fielding           Director
     John Gaetz             Director
     Erin Strench           Director

Dr.  Scott  Campbell  is the  founder  and  President  of  Campbell  and Company
Financial Group Inc., an accounting and financial consulting firm in Scottsdale,
Arizona.  He has spent years  developing  business plans,  structuring  business
financial  operations,  administering  budgets and  carrying  out all aspects of
accounting and audits for a broad range of clients.  His firms' primary emphasis
has  become  corporate  turn  arounds  with a special  focus on  clients  in the
restaurant and bar business.  Dr.  Campbell was formerly an  Institutional  Bond
trader with Prudential Bache Securities and is currently an adjunct professor of
finance and accounting at the University of Phoenix. Dr. Campbell has a Bachelor
of Arts  Degree in  Economics  from the  University  of  Calgary,  a Masters  of
Business  Administration  from the  University of Miami (FL.) and a Doctorate of
Business Administration from California Coast University.

Mr. Frank Holdraker has served as a Director and President of Creative  Eateries
Corporation (the predecessor  company to Diner's  Acquisition  Corporation) from
July 2005 until October 2006. Mr.  Holdraker was  President/Owner  of Franklin &
Associates from 1989-2004,  a full service concept  development company where he
assisted in developing  the franchise  program,  the  manufacture of proprietary
products and the establishment of purchasing and distribution  procedures for La
Salsa Fresh Mexican Grill. From 1986-1989 Mr. Holdraker was President and CEO of
Ponderosa,  Inc., a 750-unit steakhouse chain. From 1980-1986 he was Senior Vice
President of Coulter Enterprise, a major multi-state Pizza Hut franchisee. Prior
to that he was Vice  President of Pizza Hut from  1974-1980.  Mr.  Holdraker was
elected on October 21, 2006 as Chairman of Diner's.

Mr.  Kenneth E.  Fielding has served as a Director and  President of the Service
Systems  International/UltraGuard  Water  Systems  (the  predecessor  company to
Diner's Acquisition Corporation) from June 1995 until the reverse acquisition of
Creative Eateries.  On July 11, 2005, Mr. Fielding resigned as President and was

                                       30
<PAGE>
elected as Director and Vice President. Prior to UltraGuard, he was President of
Alliance Installation Electrical Contractors Ltd., since its' inception in 1976.
Alliance  was a large  electrical  contractor,  outfitting  schools,  hospitals,
warehouses,  restaurants,  and commercial buildings.  With Mr. Fielding's input,
Alliance  was a  leader  in the  electrical  contracting  industry.  Some of Mr.
Fielding's  accomplishments  include  Title 22 Status for the sale and re-use of
water in the State of  California,  created a  state-of-the-art  Single  Lamp UV
Reactor and, developed a combination Filtration and UV Disinfection point-of-use
for the  residential  market.  Mr.  Fielding  holds an  Electrical  Contractor's
license  with the  Province of British  Columbia  and a  journeyman  electrician
designation form the BC Institute of Technology.

Mr.  John R.  Gaetz has  served  as a  Director,  Secretary-Treasurer  and Chief
Financial  Officer since June 15, 1997, and as a Director,  Vice president,  and
Secretary  of UVS (a  predecessor  company to Diner's  Acquisition  Corporation)
since August 1995, positions he held in UVS' predecessor,  UV Waterguard Systems
Ltd. since 1990.  Mr. Gaetz is the founder of UV Technology,  Inc., and has over
35 years in the manufacturing  sector with a strong background in accounting and
finance. He has been involved in various companies in financial  administration,
engineering,   purchasing,   production,   product  development,   sales,  labor
relations,   service,   installation,   and  quality  control.  He  was  a  past
Vice-President  and Director of Administration  for  Harnischfeger  Corporation,
where he was responsible for the  manufacturing and development of naval defense
equipment  for the navies of NATO.  On July 11,  2005,  Mr.  Gaetz  resigned  as
Vice-President,  Secretary,  and Treasurer to the Creative  Eateries Board.  Mr.
Gaetz remains as a Director to the Board.

Mr. Erin Strench was  appointed as a Director on June 9, 2003.  Mr.  Strench has
worked as manager and owner of a number of successful  electrical and electronic
firms and is  currently  acting as a  consultant  to  companies  working  in the
electrical  industry.  Mr.  Strench has remained a Director of the Board through
the acquisition.

BOARD MATTERS

The Board of  Directors  has no standing  committees.  The Board of Directors is
responsible  for nominating a proposed slate of Directors for each year to stand
for  election  at the annual  shareholders  meeting.  We have no  provision  for
recommendation by shareholders of nominees for Director.

Members of the Board of Directors,  by virtue of their position, owe a fiduciary
duty to our company.  However,  in  accordance  with Nevada law, the Company has
provided in Article XI of its Articles of  Incorporation  (i) that contracts and
acts with another corporation are not affected by the fact that a Director has a
pecuniary  or  other  interest  in or is a  director  or  officer  of the  other
corporation  and  (ii)  that a  Director  may be a party to or  interested  in a
contract or  transaction  with our company if the interest has been disclosed to
the  Board  or the  Board  knows of the  interest  before a vote is taken on the
contract or  transaction.  As of December 31, 2006, we had no such  contracts or
transactions  with  any  Director  or  corporation  in which a  Director  had an
interest.

Based solely upon a review of Forms 3, 4 and 5 and their  amendments,  furnished
under Rule  16a-3(a)  of the  Securities  Exchange  Act of 1934  during our most
recent  fiscal year and written  representations  from persons  required to file
those Forms,  all Directors and Officers  filed all reports  required by Section
16(a) of the Act.

ITEM 10. EXECUTIVE COMPENSATION

The following table sets forth an overview of  compensation  for the fiscal year
ended December 31, 2006 to the Chief Executive Officer and each of the Company's
other Executive Officers. No officers received compensation exceeding $100,000.

                           SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
                                                     Other                   Securities                  All
Name and                                            Annual      Restricted   Underlying      All        Other
Principal                                           Compen-       Stock       Options        LTIP       Compen-
Position            Year     Salary($)    Bonus($)  sation($)   Award(s)        SARs)      Payouts($)   sation($)
--------            ----     ---------    --------  ---------   --------        -----      ----------   ---------
<S>                 <C>      <C>             <C>        <C>         <C>           <C>          <C>          <C>
Frank Holdraker
Chairman            2006        0            0         0           0             0             0           0

Scott Campbell
President/CEO       2006        0            0         0           0             0             0           0
</TABLE>

                                       31
<PAGE>
COMPENSATION OF DIRECTORS

We do not  compensate  Directors  for  their  service  as such,  although  we do
reimburse  reasonable  expenses  incurred by them in  conducting  the  Company's
directors meetings.

EMPLOYMENT  CONTRACTS  AND  TERMINATION  OF  EMPLOYMENT  AND   CHANGE-IN-CONTROL
ARRANGEMENTS

The Company has terminated all previous  Employment  Contracts and currently has
none in effect.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following  table sets forth  certain  information  regarding the  beneficial
ownership of common stock,  as of December 31, 2006 and December 31, 2005 of (i)
each person known to own  beneficially  more than 5% of our Common  Stock,  (ii)
each Director of the Company,  (iii) each of the Company's  Executive  Officers,
and (iv) all Officers and Directors as a group.  Except as otherwise  noted, the
Company  believes that the persons listed below have sole  investment and voting
power with respect to the Common Stock owned by them.

                                December 31, 2006           December 31, 2005
                            ------------------------     -----------------------
Name and Address               Shares                      Shares
 of Beneficial              Beneficially    Percent      Beneficially   Percent
    Owner                      Owned        of Class        Owned       of Class
    -----                      -----        --------        -----       --------
Frank Holdraker               145,701          .5%         145,700        2.0%
Ken Fielding                4,994,231        18.2%           6,998       .095%
John Gaetz                  2,823,106        10.3%           6,998       .095%
Erin Strench                    1,300        .005%           1,300       .018%
All officers and
 directors as a group       7,964,338        29.1%         195,820       2.67%
Oak Point Partners, Inc.    3,771,528        13.8%
American Restaurant
 Development                2,686,770         9.8%
659999 BC Ltd               1,719,189         6.3%

The address for all shareholders is in care of the Company at 7702 E. Doubletree
Ranch, Suite #300, Scottsdale, AZ 85258.

A person is deemed the  beneficial  owner of securities  that can be acquired by
that person  within 60 days from the date of this Annual Report upon exercise of
options or warrants.  Each beneficial owner's percentage ownership is determined
by assuming  that options or warrants  that are held by that person and that are
exercisable  within  60 days  from  the date of this  Annual  Report  have  been
exercised.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

None

                                       32
<PAGE>
ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K

(a) Exhibits (exhibit reference numbers refer to Item 601 of Regulation SB)

<TABLE>
<CAPTION>
Exhibit Number                  Description                                             Method of Filing
--------------                  -----------                                             ----------------
<S>             <C>                                                                    <C>
  (3)(i)         Articles of Incorporation                                                     (1)

  (3)(ii)        Bylaws, as amended                                                            (2)

  (10)(iii)      Agreement between Douglas Sommerville and Company dated 12/6/96               (3)

  (10)(iv)       Agreement between John Gaetz and the Company dated 12/6/96                    (4)

  (10)(v)        Sample  Agreement  among  minority  Shareholders  of UV Systems
                 Technology, Inc. and the Company each dated 2/28/97                           (5)

  (10)(vi)       Marketing Distribution Agreement Between UV Systems Technology,
                 Inc. and the Company                                                          (2)

  (10)(vii)      Sales  Representation  Agreement between UV Systems Technology,
                 Inc. and "The Representative"                                                 (2)

  (10)(viii)     Exclusive   Distributorship  Agreement  Between  UV  Waterguard
                 Systems,   Inc.  and  Chiyoda  Kohan  Co.,   Ltd.,   and  NIMAC
                 Corporation.                                                                  (2)

  (10)(ix)       1997 Stock Option Plan                                                        (4)

  (10)(x)        Interim Funding Agreement between UVS, MDS and WOF                            (5)

  (10)(xi)       Letter  Agreement  between  the Company and Elco Bank and Trust
                 Company Limited                                                               (5)

  (10)(xii)      Loan Agreement between the Company and TD Bank                                (6)

  (10)(xiii)     The Company's 1999 Long-Term Equity Incentive Plan                            (7)

  (10)(xiv)      Letter  Agreement  between  Service  Systems,  UVS, MDS and WOF
                 dated Feb 13, 2000                                                            (7)

  (10)(xv)       Lease dated October 2000 between  Service  Systems,  UV Systems
                 and Slough Estates Canada Limited                                             (8)

  (10)(xvi)      Legal Services Plan between Rosenfeld, Goldman & Ware, Inc                    (9)

  (10)(xvii)     Post Effective  Amendment to Legal Services Plan filed November
                 19, 2003                                                                     (10)

  (10)(xviii)    2003 Benefit Plan S-8                                                        (11)

  (10)(xix)      Independent Contractor/Consulting Agreement                                  (12)

  (10)(xx)       The Incentive Plan of UltraGuard                                             (13)

  (10)(xxi)      2004 Incentive Plan of UltraGuard                                            (14)

  (10)(xxii)     Qualified     Stock     Option     Plan     and     Independent
                 Contractor/Consulting Agreement                                              (15)

  (10)(xxiii)    2005-2006   Qualified   Stock   Option  Plan  and   Independent
                 Contractor/Consulting Agreement                                              (16)
</TABLE>

                                       33
<PAGE>
<TABLE>
<CAPTION>
<S>             <C>                                                                    <C>
  (31.1)         Certification of Frank J. Holdraker  pursuant to Sec 302 of the         Filed herewith
                 Sarbanes-Oxley Act of 2002                                              Electronically

  (31.2)         Certification  of  Scott  Campbell  pursuant  to Sec 302 of the         Filed herewith
                 Sarbanes-Oxley Act of 2002                                              Electronically

  (32.1)         Certification of Frank J. Holdraker pursuant Section 906 of the         Filed Herewith
                 Sarbanes-Oxley Act of 2002                                              Electronically

  (32.2)         Certification  of Scott  Campbell  pursuant  Section 906 of the         Filed Herewith
                 Sarbanes-Oxley Act of 2002                                              Electronically
</TABLE>

----------
(1)  Incorporated  by  reference  to the  Corporation's  Form 10SB  effective on
     January 22, 1997
(2)  Incorporated  by  reference  to the  Corporation's  Form S-8 filed with the
     Commission on October 6, 1997.
(3)  Incorporation  by  reference to the  Corporation's  Form 10Q for the fiscal
     Year ended February 28, 1997.
(4)  Incorporation by reference to the  Corporation's  Form 10KSB for the fiscal
     Year ended August 31, 1997.
(5)  Incorporation by reference to the  Corporation's  Form 10KSB for the fiscal
     Year ended August 31, 1998.
(6)  Incorporation by reference to the  Corporation's  Form 10KSB for the fiscal
     Year ended August 31, 1999.
(7)  Incorporation by reference to the  Corporation's  Form 10KSB for the fiscal
     Year ended August 31, 2000.
(8)  Incorporation  by  reference to the  Corporation's  Form 10Q for the fiscal
     Quarter ended November 30, 2000.
(9)  Incorporated  by  reference  to the  Corporation's  Form S-8 filed with the
     Commission on November 19, 2003.
(10) Incorporated  by  reference  to the  Corporation's  S-8 POS filed  with the
     Commission on March 23, 2003.
(11) Incorporated  by  reference  to the  Corporation's  Form S-8 filed with the
     Commission on March 28, 2003.
(12) Incorporated  by  reference  to the  Corporation's  Form S-8 filed with the
     Commission on June 11, 2003.
(13) Incorporated  by  reference  to the  Corporation's  Form S-8 filed with the
     Commission on December 2, 2003.
(14) Incorporated  by  reference  to the  Corporation's  Form S-8 filed with the
     Commission on December 21, 2004.
(15) Incorporated  by  reference  to the  Corporation's  Form S-8 filed with the
     Commission on July 27, 2005.
(16) Incorporated  by  reference  to the  Corporation's  Form S-8 filed with the
     Commission on February 9, 2006.

(b) Reports on Form 8-K

January 4, 2006     Rescission and Funding  Agreement  between the Company and
                    Franchise Capital Corporation dated December 29, 2005
September 26, 2006  One for Five (1:5) Reverse Stock Split on September 21, 2006
October 27, 2006    Departures of Directors or Principle Directors Officers;
                    Election of Directors; Appointment of Principle Officers

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

AUDIT FEES

The  aggregate  fees  billed for the fiscal  year ended  December  31,  2006 for
professional services rendered by our principal accountants for the audit of our
annual financial statements, review of financial statements included in our Form
10-QSB filings and other services  provided by the accountant in connection with
statutory  regulatory  filings are  approximately as follows:  Fiscal Year Ended
December 31, 2006: $25,000.

ALL OTHER ACCOUNTANT FEES

The aggregate  fees billed for the fiscal year ended December 31, 2006 for other
professional services rendered by our principal accountants are approximately as
follows: Fiscal Year Ended December 31, 2006: $NIL.

                                       34
<PAGE>
                                   SIGNATURES

In accordance  with Section 13 or 15(d) of the Securities  Exchange Act of 1934,
the registrant caused this registration  statement to be signed on its behalf by
the undersigned, thereunto duly authorized.

                                     DINER'S ACQUISITION CORPORATION


Date: April 17, 2007                 By: /s/ Frank Holdraker
                                        ----------------------------------------
                                     Title: Frank Holdraker, Chairman



Date: April 17, 2007                 By: /s/ Scott Campbell
                                        ----------------------------------------
                                     Title: Scott Campbell, President & CFO

                                       35