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, 2005

[ ] 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


                          CREATIVE EATERIES CORPORATION
                  Name of Small Business Issuer in Its Charter

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

     7400 E. McDONALD, SUITE 121
          SCOTTSDALE, AZ                                      85250
Address of Principal Executive Offices                       Zip code

                                  480-355-8170
                            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 [ ] No [X]

The Company's revenues for the fiscal year ended December 31, 2005 were $505.

The aggregate  market value of the voting and  non-voting  common equity held by
non-affiliates  of the issuer  amounting  to, in  aggregate  38,755,223  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  April  5,  2006 was
$8,526,149. The number of shares outstanding of the issuer's only class of $.001
par value Common Stock was 39,184,324 on February 28, 2006.
<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                  8

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                                                            9

Item 7.  Consolidated Financial Statements                                   13

Item 8.  Changes in and Disagreements with Accountants on Accounting
         and Financial Disclosure                                            28

Item 8A. Controls and Procedures                                             28


PART III

Item 9.  Directors, Executive Officers, Promoters, and Control Persons       28

Item 10. Executive Compensation                                              29

Item 11. Security Ownership of Certain Beneficial Owners and Management      30

Item 12. Certain Relationships and Related Transactions                      30

Item 13. Exhibits and Reports on Form 8-K                                    31

Item 14. Principal Accountant Fees and Services                              33

                                       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  Creative  Eateries
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 8-K 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 October 4, 2005,  the Company  completed a Purchase  Agreement with Franchise
Capital  Corporation.  Creative 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, Creative was to pay $200,000 cash
and 3,583,667 shares of Creative's common stock. The Company has negotiated with
Franchise  Capital  Corporation  regarding an amendment  and  rescission  to the
October Purchase  Agreement prior to December 31, 2005. The Company has not paid
the cash,  but has funded  approximately  $150,000 of the Kokopelli and Comstock
Jake's  operations.  On December 29,  2005,  the Company and  Franchise  Capital
Corporation  have  agreed to rescind  the October  Purchase  Agreement  and have
entered into a Funding  Agreement.  The Company will provide  Franchise  Capital
Corporation  a total  $600,000 in funding for the  operation  of  Kokopelli  and
Comstock.  The Company has already funded approximately  $150,000 and has 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  will 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  fails to provide the
full  amount of  funding  but at least  $300,000,  the profit  payments  will be
reduced to 25%.  If the Company  fails to provide at least  $300,000 of funding,
then the Franchise  Capital  Corporation will have not the obligation to pay any
profit payments to the Company.

BUSINESS OF ISSUER

Creative Eateries  Corporation  (Creative  Eateries)  (formerly  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.  Creative  Eateries is
poised to take  advantage  of this new  phenomenon  by  targeting  emerging  and
undervalued  restaurant/franchise  concepts and owning equity  directly in these
brands.  Creative  Eateries  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 currently has two concepts:  Q's House of Barbecue and
Fit `N Healthy.  These  concepts have not been developed and are not ready to be
franchised.  The Company  continues  to identify  potential  concepts  for their
portfolio.

OUR SERVICES

The Company provides  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 is 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

Creative Eateries 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

Creative Eateries 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

Creative Eateries 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.

EMPLOYEES

As of December 31, 2005, the Company had seven (7) full time  employees  engaged
in management and operational  activities.  Part time  consultants are used when
required, for accounting, general office, and other activities.

                                       6
<PAGE>
ITEM 2. DESCRIPTION OF PROPERTY

The Company's  office space is shared with various  other related  companies and
located at 7400 E. McDonald Drive, Suite #121,  Scottsdale,  AZ 85250. The lease
for the property is with one of the related companies and Creative Eateries pays
for a  proportionate  share of the space based on number of  offices.  The lease
term is month to month. Management believes that its facilities are adequate for
its present business.

Creative Eateries does not own or lease any other property.

ITEM 3. LEGAL PROCEEDINGS

On October 20, 1998 a suit was filed in the Supreme Court of British Columbia by
Thomas O'Flynn against  Service  Systems,  Kenneth  Fielding  (Service  Systems'
President  and  Director),  and  Charles  P. Nield (a former  Director  and Vice
President of the Company).  O'Flynn  alleges that in April of 1996, he purchased
shares of Service  Systems'  common  stock based on a  representation  that they
would be free  trading in 40 days of "the  filing of a  prospectus."  He further
alleges  that, in September of 1996,  he purchased  additional  shares of common
stock based on the  representation  that the shares would be free trading within
40 days of the common stock  becoming  free  trading.  O'Flynn  alleges that the
representation  was a warranty  and was  incorrect.  He further  alleges that he
suffered a loss  because  the share  price  decreased  while he was  holding the
shares. He seeks damages for breach of warranty,  negligence,  misrepresentation
and breach of fiduciary  duty. The amount claimed is not specified.  The Company
filed an answer  denying the claims and  continued to actively  defend the suit.
Examination  for discovery of Charles P Nield was conducted in June 1999,  since
then there has been no further activity.

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. The Company has been in discussions with Baker Tilley Co.
voluntary liquidators for Chelverton and has reached an agreement to pay $10,000
per month beginning  December 1, 2005 until the debt is settled.  The Company is
currently  in default of this  agreement  as no  payments  have been made.  With
accrued interest, the balance owing is $212,565 as of December 31, 2005.

On June 6, 2003, a group of  shareholders  consisting of the original  owners of
Innovative  Fuel  Cell  Technologies  Inc  (Shareholder  Group)  filed a consent
resolution,  which  among  other  things  elected a new slate of  directors  and
revised  the  company  by-laws.  The  Company  refused  to  accept  the  consent
resolution  or bylaws as in the  opinion of the  Company's  legal  counsel,  the
consent  resolutions  were not in accordance  with Nevada Statutes or the filing
requirements  of the Security and Exchange  Commission.  At a directors  meeting
held June 9th, 2003, the Company  elected two  additional  directors:  Edward A.
White and Erin  Strench  to the  Company  board,  bringing  the total  number of
directors  to five.  On June 16,  2003,  the  Shareholder  Group  filed  for and
obtained a temporary  restraining  order (TRO)  against the Company and its five
directors  prohibiting  the Company  from among  other  things,  issuing  stock,
transferring assets,  changing  management,  and other actions that would affect
the status quo of the Company. In addition two shareholders issued writs against
the four directors, alleging breach of fiduciary duty in respect of the issue of
certain common shares to John Gaetz, Ken Fielding and others.  On June 24, 2003,
in discussions between legal counsel for plaintiff,  respondent, and the hearing
Judge: Judge Adams, the TRO was vacated and a date of July 2, 2003 was set for a
new TRO  hearing  to be held in Reno,  Nevada.  At the July 2, 2003 TRO  hearing
Judge Adams did not grant a TRO and requested the plaintiff and respondent  file
a series of three briefs outlining their position.  The first brief was filed on
July 11, 2003 by our counsel.  The plaintiff  responded on July 18, 2003 and our
counsel  filed the final  brief on July 25,  2003.  The  Company's  counsel  has
responded  to the  various  other  suits  filed  against  the  Company  and  its
directors.  The Company had  attempted  during the second  quarter to have these
cases moved from Nevada State court to federal  court and in the third  quarter,
we were advised that these cases would be heard in federal court.  Subsequent to
December 31, 2003, in March 2004 the  Company's  legal counsel filed to withdraw
from the action as a result of non-payment of legal fees. The court approved the
withdrawal  in two of the four cases.  By April 29, 2004,  the Plaintiff and the
Defendant must file a proposed  pre-trial  order with the Federal  Court,  which
upon  approval;  the Court will set down for trial.  During  this  quarter,  the
Company and the Plaintiff requested and received an extension to August 26, 2004
to settle this matter or file the  pre-trial  order,  which upon  approval;  the
Court will set down for trial.  During this fiscal period, one of the Plaintiffs
withdrew  from the  action.  On October 28,  2004 the  Company  jointly  filed a
pre-trial  notice and on November 15, 2004 in a conference call with the sitting
Judge a trial date was set for February 22, 2005.  Prior to the trial,  date the
parties reached a settlement on all matters.  Under the terms of the settlement,
the Plaintiffs agreed to, have dismissed all of the lawsuits, and have cancelled
all debts owed by the Company to the Plaintiff amounting to about $98,797.

                                       7
<PAGE>
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None

                                     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  "CEAT.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.  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, 2005 are actual values reported by the OTC-BB.

    FISCAL YEAR 2005                             LOW               HIGH
    ----------------                             ---               ----
    Quarter ended March 31, 2005                 2.00              6.50
    Quarter ended June 30, 2005                  0.90              4.40
    Quarter ended September 30, 2005             0.80              2.20
    Quarter ended December 31, 2005              0.07              1.60

STOCKHOLDERS

As of December 31, 2005, there were  approximately  216 holders of record of the
common stock.

COMMON STOCK

Our authorized capital stock consists of 100,000,000 shares of common stock with
a par vale of $0.001 per share.  On December  31,  2005,  there were  36,664,324
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, 2005, the Company issued the following shares
for the listed consideration:

<TABLE>
<CAPTION>
                                                     Residency/      Consideration
Date                                    Shares      Citizenship        Valued at      Consideration     Exemption
----                                    ------      -----------        ---------      -------------     ---------
<S>                                   <C>           <C>               <C>            <C>                <C>
Acquisition of Creative Eateries        609,021                                        Acquisition
RCI stockholders                     30,802,369                                        Acquisition
April 21/05                           2,500,000          USA           $2,500,000       Consulting        S-8*
July 01/05                              500,000          USA           $  500,000       Consulting        Reg 144
July 15/05                              120,000          CANADA        $  120,000       Consulting        S-8*
July 18/05                              300,000          USA           $  300,000       Consulting        S-8*
July 18/05                               25,000          USA           $   25,000       Consulting        S-8*
Sept 16/05                                1,200          USA           $    1,200       Consulting        Reg 144
Oct 06/05                               225,000          USA           $  360,000       Consulting        Reg 144
Oct 06/05                                75,000          USA           $  120,000       Consulting        S-8*
</TABLE>

                                       8
<PAGE>
<TABLE>
<CAPTION>
<S>                                   <C>           <C>               <C>            <C>                <C>
Oct 11/05                                18,500          USA           $   24,975       Expenses          Reg 144
Oct 25/05                               100,000          USA           $  110,000       Consulting        Reg 144
Oct 26/05                                40,000          USA           $   10,000       Subscription
Nov 01/05                                40,000          USA           $   10,000       Subscription
Nov 7/05                                 70,000          USA           $   77,000       Consulting        Reg 144
Nov16/05                                 50,000          USA           $   55,000       Consulting        Reg 144
Nov 23/05                               400,000          USA           $  100,000       Subscription
Dec 1/05                                 88,234          USA           $66,175.50       Consulting        Reg 144
Dec 7/05                                400,000          USA           $   64,000       Consulting        S-8*
Dec 7/05                                 20,000          CANADA        $    3,200       Consulting        S-8*
Dec 15/05                                50,000          USA           $   12,000       Expenses          S-8*
Dec 16/05                               200,000          USA           $   36,000       Consulting        S-8*
Dec 29/05                                20,000          USA           $    5,600       Consulting        S-8*
Dec 30/05                                10,000          USA           $    2,500       Subscription
</TABLE>

----------
* Registered S-8 on July 27, 2005

Balance Outstanding December 31, 2005 36,664,324

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

As a result of the reverse  acquisition  of Creative  Eateries on July 11, 2005,
the Company's status changed to that of a development stage company.  Therefore,
consolidated  balance sheets of Creative  Eateries  Corporation  and the related
consolidated  statements of operations and cash flows and stockholders'  equity,
include operations for the period from September 24, 2004 (Date of Inception) to
December 31, 2005.  The company has generated  total revenue since  inception to
December  31,  2005 of $505.  This  revenue  relates  to  services  prior to the
acquisition and is unrelated to the restaurant franchising business.

We have incurred  aggregate net losses of  approximately  $5,560,387  during the
period from our  inception on September  24, 2004 to December 31, 2005.  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, 2005 were  $5,456,825.  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, 2005
of  $5,558,554.  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

PLAN OF OPERATION

During  fiscal  year 2006,  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.

                                       9
<PAGE>
BASIS OF PRESENTATION

The financial statements include accounts of Creative Eateries Corporation,  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 $14,037 as of December 31, 2005. The Company
experienced a cash outflow of $(338,152)  from operating  activities  during the
twelve months ending December 31, 2005.

In January  2006,  we received  $6,900  from  related  parties and $50,000  from
unrelated parties. In February 2006, we received from $10,000 in capital from an
investor. In March 2006, we received $89,480 from related parties' loans.

We expect that during 2006, as and if sales increase, 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 2005, 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
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:

                                       10
<PAGE>
     *    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
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

                                       11
<PAGE>
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, 2005

Comparisons  to the prior year are not  appropriate  as the  Company was in only
three  months of operation  in 2004.  The results  below are only for the twelve
month period ending December 31, 2005.

REVENUES.  For  fiscal  2005,  we  reported  revenues  of  $505  resulting  from
operations prior to the acquisition.

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

NET LOSS FOR THE PERIOD.  For fiscal 2005, we reported a net loss of $5,558,554.
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.

NET LOSS PER  SHARE.  For  fiscal  2005,  we  reported  a net loss per  share of
($0.17).

                                       12
<PAGE>
OFF-BALANCE SHEET ARRANGEMENTS AND AGGREGATE CONTRACTUAL OBLIGATIONS

None

ITEM 7. 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

                                       13
<PAGE>
             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Stockholders and the Board of Directors
of Creative Eateries Corporation:

We have audited the accompanying consolidated balance sheet of Creative Eateries
Corporation   and   subsidiaries  as  of  December  31,  2005  and  the  related
consolidated  statements of operations,  stockholders' equity (deficit) and cash
flows for year then  ended and the  period  from  September  24,  2004  (date of
inception) to December 31, 2004 and for the period from September 24, 2004 (date
of inception) through December 31, 2005. 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.  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
Creative  Eateries  Corporation and subsidiaries as of December 31, 2005 and the
results  of its  operations  and its cash  flows for the year then ended and the
period from  September 24, 2004 (date of inception) to December 31, 2004 and for
the period from  September  24, 2004 (date of  inception)  through  December 31,
2005, 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
May 2, 2006

                                       14
<PAGE>
                         Creative Eateries Corporation
                          (A Development Stage Company)
                          Consolidated Balance Sheets

                                                                   December 31,
                                                                      2005
                                                                   ----------
                                                                        $
ASSETS

Current Assets
  Cash                                                                 14,037
  Cash-restricted                                                      45,034
  Accounts receivable, less allowance for doubtful
  accounts:  2005 $85,092 and 2004 $0                                  72,537
  Notes receivable                                                         --
                                                                   ----------
Total Current Assets                                                  131,608
                                                                   ----------

Prepaid expenses and deposits                                             268
Property and Equipment (Note 3)                                         2,835
                                                                   ----------

Total Assets                                                          134,711
                                                                   ==========

LIABILITIES AND STOCKHOLDERS' DEFICIT

Current Liabilities
   Accounts payable                                                   651,163
   Accrued liabilities                                                155,222
   Notes payable (current)                                            275,000
   Loans payable (current)                                            151,651
   Deferred revenue (current)                                          20,000
                                                                   ----------
Total Current Liabilities                                           1,253,036
                                                                   ----------

Loans payable (long-term portion)                                      60,914
Amounts owing to related parties                                      447,469
                                                                   ----------
Total Liabilities                                                   1,761,419
                                                                   ----------
Stockholders' Deficit

Common stock, (Note 6)
  100,000,000 shares authorized, with a par value of $0.001
   36,664,324 and 28,400,000 issued and outstanding,
   respectively                                                        36,664

Additional paid-in capital                                          3,897,015

Deficit Accumulated in the Development Stage                       (5,560,387)
                                                                   ----------
Total Stockholders' Deficit                                        (1,626,708)
                                                                   ----------

Total Liabilities and Stockholders' Deficit                           134,711
                                                                   ==========

           See accompanying notes to consolidated financial statements

                                       15
<PAGE>
                         Creative Eateries Corporation
                         (A Development Stage Company)
                     Consolidated Statements of Operations


                            Accumulated                             Period from
                            from date of                           September 24,
                            inception to        Year Ended            2004 to
                            December 31,        December 31,        December 31,
                               2005                2005                2004
                            ----------          ----------          ----------
                                 $                   $                   $
Revenue                            505                 505                  --

Cost of sales                       --                  --                  --
                            ----------          ----------          ----------
Total Gross Profit              45,505              45,505                  --
                            ----------          ----------          ----------
Expenses
  General and
  Administrative             5,458,658           5,456,825               1,833
  Interest                     102,233             102,233                  --
                            ----------          ----------          ----------
Total Expenses               5,560,891           5,559,058               1,833
                            ----------          ----------          ----------
Net Loss from
Operations                  (5,560,387)         (5,558,554)             (1,833)
                            ----------          ----------          ----------

Net Loss for the Period     (5,560,387)         (5,558,554)             (1,833)
                            ==========          ==========          ==========
Net Loss Per Share -
Basic and Diluted                (0.17)              (0.17)                 --
                            ==========          ==========          ==========
Weighted Average
Number of Shares
Outstanding                 32,358,134          32,773,005          30,802,367
                            ==========          ==========          ==========

          See accompanying notes to consolidated financial statements

                                       16
<PAGE>
                         Creative Eateries Corporation
                         (A Development Stage Company)
                     Consolidated Statements of Cash Flows

<TABLE>
<CAPTION>
                                                                Accumulated                         Period from
                                                                from date of                       September 24,
                                                                inception to      Year Ended          2004 to
                                                                December 31,      December 31,      December 31,
                                                                   2005              2005              2004
                                                                ----------        ----------        ----------
                                                                    $                 $                 $
<S>                                                             <C>               <C>                   <C>
Cash Flows Used In Operating Activities
  Net loss                                                      (5,560,387)       (5,558,554)           (1,833)
  Adjustments to reconcile net loss to net cash provided
   by (used in) operating activities
     Depreciation and amortization                                     321               321                --
     Shares issued for as compensation for services              4,380,151         4,380,151                --
  Changes in operating assets and liabilities (net of
   business acquisition)
     (Increase) decrease in accounts receivable                    (72,537)           20,463           (93,000)
     (Increase) decrease in notes receivable                            --            14,900           (14,900)
     (Increase) decrease in prepaid expenses and deposits               --                --                --
     Increase (decrease) in accounts payable and accrued
      liabilities                                                  734,567           734,567                --
     Increase (decrease) in deferred revenue                        20,000            20,000                --
                                                                ----------        ----------        ----------
Net Cash Provided by (Used in) Operating Activities               (447,885)         (338,152)         (109,733)
                                                                ----------        ----------        ----------
Cash Flows Used in Investing Activities
  Acquisition of furniture and computer equipment                   (3,156)           (3,156)               --
  Cash from acquisition of UltraGuard                                5,678             5,678
                                                                ----------        ----------        ----------
Net Cash Provided by (Used) in Investing Activities                  2,522             2,522                --
                                                                ----------        ----------        ----------
Cash Flows From Financing Activities
  Proceeds from subscribed shares                                  184,400           122,500            61,900
  Increase (decrease) in loans/notes from unrelated parties        275,000           225,000            50,000
                                                                ----------        ----------        ----------
Net Cash Provided by (Used in) Financing Activities                459,400           347,500           111,900
                                                                ----------        ----------        ----------

Increase in Cash                                                    14,037            11,870             2,167

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

Cash - End of the Period                                            14,037            14,037             2,167
                                                                ==========        ==========        ==========
</TABLE>

           See accompanying notes to consolidated financial statements

                                       17
<PAGE>
                         Creative Eateries Corporation
                         (A Development Stage Company)
            Consolidated Statement of Stockholders' Equity (Deficit)
        From September 24, 2004 (Date of Inception) to December 31, 2005
                           (Expressed in US dollars)

<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         30,802,367       30,802          31,098               --           61,900

Net loss for the period                                                              (1,833)          (1,833)
                                  -----------      -------      ----------       ----------       ----------
Balance - December 31, 2004        30,802,367       30,802          31,098           (1,833)          60,067

Common stock issued for cash          490,000          490         122,010                           122,500
Issuance of shares for
 consulting services                4,712,934        4,713       4,363,438                         4,368,151
Issuance of shares for
 employee compensation                 50,000           50          11,950                            12,000
Adjustment for recapitalization
 of Reverse (6/30/05)                 609,023          609        (681,481)                         (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          36,664,324       36,664       3,897,015       (5,560,387)      (1,626,708)
                                  ===========      =======      ==========      ===========      ===========
</TABLE>


         See Accompanying Notes to the Consolidated Financial Statements

                                       18
<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  Creative  Eateries  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 Creative
     Eateries Corporation  ("Creative") 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  Creative  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, has a working capital deficit of $863,409,
     and has accumulated  operating losses of $1,671,571  since  inception.  The
     combined company has yet to generate  significant  revenue and will require
     additional  capital to do so. 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 the Kokopelli  Mexican  restaurant  concept
     and explore  acquisitions of other existing restaurant  concepts.  However,
     there is no assurance  that the Company will be successful in executing its
     business plan.

2.   Significant Accounting Policies

     CONSOLIDATED FINANCIAL STATEMENTS

     These  financial  statements  include the accounts of Creative 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.

     On July 11, 2005 ("the acquisition  date"),  Creative Eateries  Corporation
     ("Creative")  acquired all of the outstanding stock of Restaurant Companies
     International,  Inc ("RCI"). For accounting  purposes,  the acquisition was
     treated as the  acquisition  of Creative 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.

                                       19
<PAGE>
     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  220,000  shares at December 31,  2005.  These  potential
     common shares have been excluded from the diluted EPS  calculation  because
     the effect is anti-dilutive.

     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. The Company
     has 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.

     No stock  options  were  granted  to  employees  in  fiscal  2004 and 2005,
     therefore no pro-forma disclosures have been presented.

     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.

                                       20
<PAGE>
     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, the Financial  Accounting  Standards  Board (FASB) issued
     Statement of Financial  Accounting  Standard (SFAS) No. 123R,  "SHARE BASED
     PAYMENT".  SFAS  123R  is a  revision  of  SFAS  No.  123  "ACCOUNTING  FOR
     STOCK-BASED  COMPENSATION",  and supersedes APB Opinion No. 25, "ACCOUNTING
     FOR STOCK ISSUED TO  EMPLOYEES"  and its related  implementation  guidance.
     SFAS 123R  establishes  standards for the  accounting for  transactions  in
     which an entity exchanges its equity instruments for goods or services.  It
     also  addresses  transactions  in which an  entity  incurs  liabilities  in
     exchange  for goods or  services  that are  based on the fair  value of the
     entity's equity instruments or that may be settled by the issuance of those
     equity   instruments.   SFAS  123R  focuses  primarily  on  accounting  for
     transactions  in which an entity obtains  employee  services in share-based
     payment transactions. SFAS 123R does not change the accounting guidance for
     share-based payment transactions with parties other than employees provided
     in SFAS 123 as originally  issued and Emerging  Issues Task Force Issue No.
     96-18,  "ACCOUNTING  FOR EQUITY  INSTRUMENTS  THAT ARE ISSUED TO OTHER THAN
     EMPLOYEES  FOR  ACQUIRING,   OR  IN  CONJUNCTION  WITH  SELLING,  GOODS  OR
     SERVICES".  SFAS 123R does not address the  accounting  for employee  share
     ownership  plans,  which are subject to AICPA  Statement of Position  93-6,
     "EMPLOYERS'  ACCOUNTING  FOR EMPLOYEE  STOCK  OWNERSHIP  PLANS".  SFAS 123R
     requires a public entity to measure the cost of employee  services received
     in exchange for an award of equity instruments based on the grant-date fair
     value of the award (with limited exceptions).  That cost will be recognized
     over the period during which an employee is required to provide  service in
     exchange for the award - the requisite  service period (usually the vesting
     period).  SFAS  123R  requires  that  the  compensation  cost  relating  to
     share-based  payment  transactions  be recognized in financial  statements.
     That  cost  will be  measured  based on the fair  value  of the  equity  or
     liability  instruments issued. The scope of SFAS 123R includes a wide range
     of  share-based   compensation   arrangements   including   share  options,
     restricted  share  plans,   performance-based  awards,  share  appreciation
     rights,  and employee share purchase  plans.  Public  entities that file as
     small  business  issuers  will be  required to apply SFAS 123R in the first
     interim or annual reporting period that begins after December 15, 2005. The
     adoption of this standard is not expected to have a material  effect on the
     Company's results of operations or financial position.

     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 March 2005, the SEC staff issued Staff Accounting Bulletin No. 107 ("SAB
     107") to give guidance on the  implementation of SFAS No. 123R. The Company
     will consider SAB 107 during the implementation of SFAS NO. 123R.

     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

                                       21
<PAGE>
     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 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,
                                                         2005          2004
                                        Accumulated     Net Book      Net Book
                                Cost    Depreciation     Value         Value
                                ----    ------------     -----         -----
                                 $           $             $             $

     Property and equipment    3,156        321          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 66,667 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.

     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
          Creative Eateries and converted to a cash advance owing to the related
          party.

<TABLE>
<CAPTION>
             Type               Description               Date       Principal     Interest     Due Date
             ----               -----------               ----       ---------     --------     --------
<S>      <C>              <C>                          <C>          <C>           <C>          <C>
          Note Payable     Restaurant Companies Int'l   4/2/2005      $100,000     8%/Annum     7/2/2006
          Debenture        Fit `N Healthy               8/15/2005     $ 50,000     10%/Annum    12/1/2005
          Note Payable     Creative Eateries            11/8/2005     $100,000     12%/Annum    11/8/2006
</TABLE>

                                       22
<PAGE>
     e)   On April 25, 2003, Chelverton Fund Limited filed a suit in the Supreme
          Court of British Columbia  against  UltraGuard for non-payment of debt
          in the amount of $155,000.  UltraGuard entered an appearance,  filed a
          defence  against this claim,  and attempted to negotiate a settlement.
          Chelverton filed additional information that supported their claim and
          UltraGuard responded with a "no defines" position. Judgment was issued
          in the amount of $183,944  (Cnd$234,642)  including interest and legal
          costs. On April 5, 2004, the Company  appeared in the Supreme Court of
          British  Columbia  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 hearing was  adjourned  with a
          requirement  that UltraGuard  provide  additional  detailed  financial
          information.  This information has now been provided.  The Company has
          been in discussions  with Baker Tilley Co.  voluntary  liquidators for
          Chelverton  and has  reached an  agreement  to pay  $10,000  per month
          beginning  December 1, 2005 until the debt is settled.  The Company is
          currently in default of this  agreement as no payments have been made.
          With accrued interest, the amount owing is now $212,565.

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.

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.

     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 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
          ------------              ----------------        -----
          April 21, 2005               2,500,000            $1.00
          July 15, 2005                  120,000            $1.00
          August 18, 2005                325,000            $1.00
          October 6, 2005                 75,000            $1.60
          December 7, 2005               420,000            $0.16
          December 16, 2005              200,000            $0.18
          December 29, 2005               20,000            $0.28

                                       23
<PAGE>
     d)   Issuance of Restricted Common Shares

          During the fiscal period ending  December 31, 2005 the Company  issued
          restricted  shares to one employee  for 50,000  shares as an incentive
          and  to six  consultants  for  consulting  services  in the  following
          amounts:


          July 1, 2005                   500,000
          September 16, 2005               1,200
          October 6, 2005                225,000
          October 11, 2005                18,500
          October 25, 2005               100,000
          November 7, 2005                70,000
          November 16, 2005               50,000
          December 1, 2005                88,234
          December 15, 2005               50,000

          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.

          During  the year  ending  December  31,  2005 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)                      3,660,000           .87      3,173,800
          Consulting services provided pursuant to 144
           restricted shares (Note 6d)                   1,102,934          1.09      1,206,350
                                                         ---------      --------      ---------
                                                         4,762,934                    4,380,150
                                                         =========                    =========
</TABLE>

          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 October 20, 1998, a suit was filed in the Supreme  Court of British
          Columbia  by an original  shareholder  ("the  plaintiff")  against the
          Company's  President  and  Director,  and a former  Director  and Vice
          President of the Company. The plaintiff alleges that in April of 1996,
          he purchased  common shares of the Company  based on a  representation
          that  they  would  be free  trading  in 40 days  of "the  filing  of a
          prospectus."  The plaintiff  further alleges that in September of 1996
          he  purchased  additional  common  shares of the Company  based on the
          representation that the shares would be free trading within 40 days of
          the common shares  becoming  free trading and that the  representation
          was a warranty and was incorrect.  The plaintiff  further alleges that
          he  suffered a loss  because the share  price  decreased  while he was
          holding  the  shares and is seeking  damages  for breach of  warranty,
          negligence, misrepresentation and breach of fiduciary duty. The amount
          claimed is not  specified.  The  Company  filed an answer  denying the
          claims and will  continue  to actively  defend the suit.  The suit has
          remained  inactive since early 1999.  There has been no loss provision
          accrued   pursuant  to  this  action  against  the  Company,   as  the
          probability of incurring a material loss is remote.

                                       24
<PAGE>
     b)   On April 25, 2003, Chelverton Fund Limited filed a suit in the Supreme
          Court of British Columbia  against  UltraGuard for non-payment of debt
          in the amount of $155,000.  UltraGuard entered an appearance,  filed a
          defence  against this claim,  and attempted to negotiate a settlement.
          Chelverton filed additional information that supported their claim and
          UltraGuard responded with a "no defines" position. Judgment was issued
          in the amount of $183,944  (Cnd$234,642)  including interest and legal
          costs. On April 5, 2004, the Company  appeared in the Supreme Court of
          British  Columbia  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 hearing was  adjourned  with a
          requirement  that UltraGuard  provide  additional  detailed  financial
          information.  This information has now been provided.  The Company has
          been in discussions  with Baker Tilley Co.  voluntary  liquidators for
          Chelverton  and has  reached an  agreement  to pay  $10,000  per month
          beginning  December 1, 2005 until the debt is settled.  The Company is
          currently in default of this  agreement as no payments have been made.
          With accrued interest, the amount owing is now $212,565.

     c)   On June 6, 2003, a group of shareholders  (Shareholder  Group) filed a
          consent  resolution,  which, among other things elected a new slate of
          directors and revised the Company's  by-laws.  The Company  refused to
          accept the  consent  resolution  or  by-laws as in the  opinion of the
          Company's  legal  counsel,   the  consent   resolutions  were  not  in
          accordance  with  Nevada  Statutes or the filing  requirements  of the
          Security and Exchange Commission.  At a directors meeting held June 9,
          2003, the Company elected two additional  directors:  Edward White and
          Erin  Strench to the  Company's  board,  bringing  the total number of
          directors to five. On June 16, 2003, the  Shareholder  Group filed for
          and obtained a temporary  restraining  order (TRO) against the Company
          and its five  directors  prohibiting  the  Company,  from among  other
          things,  issuing stock,  transferring assets,  changing management and
          other  actions  that would  affect the status quo of the  Company.  In
          addition,  two  shareholders  issued writs against various  directors,
          alleging  breach of fiduciary  duty in respect of the issue of certain
          common shares to the Company's  officers others.  On June 24, 2003, in
          discussions  between legal counsel for  plaintiff,  respondent and the
          hearing Judge,  the TRO was vacated and a date of July 2, 2003 was set
          for a new TRO hearing to be held in Reno, Nevada. At the July 2, 2003,
          the TRO hearing  Judge did not grant a TRO and requested the plaintiff
          and respondent file a series of three briefs outlining their position.
          The first brief was filed on July 11, 2003 by the  Company's  counsel.
          The  plaintiff  responded on July 18, 2003 and the  Company's  counsel
          filed  the  final  brief on July 25,  2003.  The  Judge has not made a
          ruling on the TRO. The Company's  counsel has responded to the various
          other suits filed against the Company and its  directors.  Counsel for
          the Company was  successful  in moving these actions from Nevada State
          jurisdiction to federal jurisdiction.

          In March 2004, the Company's  legal counsel filed to withdraw from the
          action as a result of  non-payment  of legal fees.  The court approved
          the  withdrawal  of the lawyer on two of the four cases.  By April 29,
          2004, the Plaintiff and the Defendant were required to file a proposed
          pre-trial order with the Federal Court.  The Company and the Plaintiff
          requested  and received an extension to August 26, 2004 to settle this
          matter or file the pre-trial  order,  which upon  approval;  the Court
          will set down for trial. On October 28, 2004 the Company jointly filed
          a pre-trial  notice and on November 15, 2004 in a conference call with
          the sitting Judge a trial date was set for February 22, 2005. Prior to
          the trial date, the parties reached a settlement on all matters. Under
          the  terms  of the  settlement,  the  Plaintiffs  agreed  to and  have
          dismissed all of the lawsuits and have cancelled all debts owed by the
          Company to the Plaintiff amounting to about $98,797.

     d)   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 has  reserved  his
          decision on the matter.  The  possible  rulings by the Court may be in
          favour of either the  Company,  the  Plaintiff or the Court could also
          dismiss the Rule 18A  hearing  and set the matter to trial,  to a date
          set in April 2006.

     e)   On October 4, 2005,  the Company  completed a Purchase  Agreement with
          Franchise  Capital  Corporation.  Creative  purchased  from  Franchise
          Capital its  interest in  Kokopelli  Sonoran  Grill,  Comstock  Jakes,

                                       25
<PAGE>
          Cousin Vinnie's Italian Diner, and Kirby Foo's Asian Grill. As per the
          Agreement,  Creative will pay $200,000  cash and  3,583,667  shares of
          Creative's  common stock.  The Company has not paid the cash,  but has
          funded  approximately  $150,000 of the Kokopelli  and Comstock  Jake's
          operations.

          On December 29, 2005,  the Company and Franchise  Capital  Corporation
          have agreed to rescind the October Purchase Agreement and have entered
          into a Funding  Agreement.  The Company will provide Franchise Capital
          Corporation a total $600,000 in funding for the operation of Kokopelli
          and Comstock.  The Company has already funded  approximately  $150,000
          and has 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 will 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 fails to provide the
          full amount of funding but at least $300,000, the profit payments will
          be reduced to 25%. If the Company  fails to provide at least  $300,000
          of  funding,  then the  Franchise  Capital  Corporation  will have not
          obligation to pay any profit payments to the Company.

     f)   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
     $118,801were  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)

                                       26
<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  $2,222,000  as of December 31,
     2005. 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  increased by $2,222,000  for the year
     ended December 31, 2005.  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 year ended  December 31, 2005 and for
     the period from September 24, 2004 (date of inception) through December 31,
     2004 was as follows:

                                               2005                 2004
                                           -----------           -----------
     Current benefit                       $  (428,000)          $        --

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

     The components of the deferred income tax asset as of December 31, 2005 are
     as follows:

     Difference in stock based compensation                    $ 1,752,000

     Difference in accruals                                          8,000
     Difference in accounts receivable                              34,000
     Net operating loss carryforward                               428,000
                                                               -----------
     Deferred income tax asset                                   2,222,000
     Valuation allowance                                        (2,222,000)
                                                               -----------
                                                               $         0
                                                               ===========

     A  reconciliation  of the  differences  between the statutory and effective
     income tax rates for the year ended  December  31,  2005 and for the period
     from September 24, 2004 (date of inception)  through  December 31, 2004 was
     as follows:

                                           2005                       2004
                                -----------------------      -------------------
                                  Amount           %         Amount          %
     Federal statutory rates    $(1,889,908)    (34.00)      $   --           --
     State income taxes - net
      of federal benefit           (333,513)     (6.00)          --           --
     Valuation allowance          2,222,154      39.08           --           --
     Other                            1,268        .02           --           --

                                -----------     ------       ------       ------
        Effective rate          $         0          0       $   --           --
                                ===========     ======       ======       ======

     The total net operating loss carryforward of approximately $1,072,000 as of
     December 31, 2004, for both federal and state purposes,  begins expiring in
     2024 and 2009, respectively.

11.  Subsequent Events

     a)   On   February   7,   2006  the   Company   adopted   the   Independent
          Contractor/Consulting Plan (the "Plan") registered with the Securities
          Exchange  Commission on February 7, 2005 on Form S-8.  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.

     b)   On March 27, 2006,  the Company  signed a Letter of Intent to purchase
          Tuscan Kitchen Concept of California,  a 4-location Italian restaurant
          concept  featuring  full service.  A sales price of four times audited
          EBITDA,  or  approximately  $2,800,000 has been  negotiated  with 100%
          ownership in the company.

                                       27
<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
        ----                       --------                       ---

     Frank Holdraker           Director, President                 61
     Jean Lang                 Director, Secretary                 62
     Ken Fielding              Director, Vice President
     John Gaetz                Director
     Erin Strench              Director

Mr.  Frank  Holdraker  is  President  and Chief  Executive  Officer of  Creative
Eateries Corporation. 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
July 11, 2005, as Director and President of Creative Eateries.

Ms. Jean Lang has 17 years experience in Project Management,  Office Automation,
Corporate  Training,  and  Website  Management.   She  has  been  successful  in
developing and  implementing  innovative  training  programs,  coordinating  and
overseeing a diversity of office  automation/system  implementation projects and
providing  complex  technical and  operational  support in Fortune 500 companies
such as Ford Motor Company,  DaimlerChrysler Corporation, Home Shopping Network,
and Detroit Edison.  Her experience  includes  applications for Human Resources,
Payroll,  Timekeeping,  Workorders,  OSHA, Medical,  Heavy Duty Truck Ordering &
Pricing Systems,  Call Center Sales, Customer Service, Menu Design, and Training
of Point of Sale Systems.  Ms. Lang  attended the State  University of NY, has a
Diploma in Computer  Operations &  Programming  from  Control Data  Institute in
Michigan,  is a Certified  Achieve Global  Facilitator,  and has a Dale Carnegie
Certification in Effective Public Speaking. Ms Lang was elected on July 11, 2005
as Director and Secretary of Creative Eateries.

                                       28
<PAGE>
Mr.  Kenneth E.  Fielding has served as a Director and  President of the Service
Systems  International/UltraGuard  Water  Systems  (the  predecessor  company to
Creative Eateries  Corporation) from June 1995 until the reverse  acquisition of
Creative  Eateries.  On July 11,  2005,  Mr.  Fielding  resigned as President of
Creative  Eateries  and was 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 Creative Eateries  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, 2005, 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, 2005 to the Chief Executive Officer and each of the Company's
other Executive Officers whose total compensation exceeded $100,000.

                           SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
  (a)                (b)       (c)         (d)        (e)         (f)           (g)          (h)         (i)
Name and                                            Other                    Securities                  All
Principal                                           Annual      Restricted   Underlying      All        Other
Position                                            Compen-       Stock       Options        LTIP       Compen-
                    Year     Salary($)    Bonus($)  sation($)   Award(s)        SARs)      Payouts($)   sation($)
                    ----     ---------    --------  ---------   --------        -----      ----------   ---------
<S>                 <C>      <C>             <C>        <C>         <C>           <C>          <C>          <C>
Frank Holdraker
President/CEO       2005     $44,808         0          0           0             0            0            0
</TABLE>

                                       29
<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

An employment  agreement was signed on February 1, 2005, between the Company and
Frank Holdraker as CEO, President,  and Director.  The term of the employment is
from February 1, 2005, until January 31, 2010, but may be terminated at any time
for cause. Annual salary is $50,000 per year plus bonus to include:  (1) .02% of
all Franchise Fee income from the sale of  franchisees of each concept owned and
operated by Creative  Eateries,  and (2) .02% of the grow  royalty  paid to each
concept owned and operated by Creative Eateries.

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, 2005 and December 31, 2004 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, 2005           December 31, 2004
                            ------------------------     -----------------------
Name and Address               Shares                      Shares
 of Beneficial              Beneficially    Percent      Beneficially   Percent
    Owner                      Owned        of Class        Owned       of Class
    -----                      -----        --------        -----       --------
Frank Holdraker               728,500         2.0%            0            0%
Jean Lang                     174,167         0.5%            0            0%
Ken Fielding                   34,992        .095%            0            0%
John Gaetz                     34,942        .095%
Erin Strench                    6,500        .018%
All officers and
 directors as a group         979,101        2.67%            0            0%

The address for all  shareholders  is in care of the Company at 7400 E. McDonald
Drive, Suite #121, Scottsdale, AZ 85250.

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

During the period  from  January 1, 2002 to December  31,  2005,  the  following
Directors,  Executive  Officers made loans to the Company for additional working
capital.  The  outstanding  balances  at December  31,  2005 are:  John R Gaetz,
$129,808 and Ken Fielding $239,321.

                                       30
<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>

                                       31
<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

May 2, 2005       Letter Agreement  between the Company and American  Restaurant
                  Development Company dated April 21, 2005
June 15, 2005     Report  on vote by  Shareholders  to change  name to  Creative
                  Eateries  and  affect a one for one  hundred  (1:100)  reverse
                  stock split on June 13, 2005
July 11, 2005     Board approval to transfer  capital assets to Innovative  Fuel
                  Cell Technology and distribution of shares on June 30, 2005
July 12, 2005     Share  exchange  agreement  between the Company and Restaurant
                  Companies International, Inc. dated July 11, 2005
August 18, 2005   Purchase Agreement of assets between the Company and Franchise
                  Capital Corporation dated August 15, 2005
October 6, 2005   Purchase Agreement of assets between the Company and Franchise
                  Capital Corporation dated October 4, 2005
November 2, 2005  Purchase  Agreement between the Company and Pasta Pranzo dated
                  November 1, 2005
November 21, 2005 Change in Certifying Accountant on November 18, 2005
December 6, 2005  Amended Change in Certifying Accountant on November 18, 2005
January 4, 2006   Rescission  and  Funding  Agreement  between  the  Company and
                  Franchise Capital Corporation dated December 29, 2005

                                       32
<PAGE>
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

AUDIT FEES

The  aggregate  fees  billed for the fiscal  year ended  December  31,  2005 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, 2005: $22,300.

ALL OTHER ACCOUNTANT FEES

The aggregate  fees billed for the fiscal year ended December 31, 2005 for other
professional services rendered by our principal accountants are approximately as
follows: Fiscal Year Ended December 31, 2005: $NIL.

                                   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.

                              CREATIVE EATERIES CORP


                              /s/ Frank J. Holdraker
                              --------------------------------------
                              Frank J. Holdraker, President


Date: May 10, 2006            /s/ Frank J. Holdraker
                              --------------------------------------
                              Frank J. Holdraker, President


Date: May 10, 2006            /s/ Scott Campbell
                              --------------------------------------
                              Scott Campbell, Vice President Finance

                                       33