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

**FORM 10-QSB**

(Mark One)    [X] Quarterly report under Section 13 or 15(d) of the Securities Exchange Act    of 1934 For the quarterly period ended September 30, 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: 000-26095**

| **ENVIROKARE TECH, INC.**                                         |
|-------------------------------------------------------------------|
|                                                                   |
| (Exact name of small business issuer as specified in its charter) |

| **Nevada**               |   | **88-0412549**                       |
|--------------------------|--------|--------------------------------------|
|                          |   |                                      |
| (State of incorporation) |   | (IRS Employer Identification Number) |

| **641 Lexington Avenue, 14th Floor****New York, New York 10022** |
|------------------------------------------------------------------|
|                                                                  |
| (Address of principal executive office)                          |

| **(212) 634-6333**          |
|-----------------------------|
|                             |
| (Issuer's telephone number) |

      APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY      PROCEEDINGS DURING THE PRECEDING FIVE YEARS      Check whether the issuer filed all documents and reports required to be filed by      Section 12, 13 or 15(d) of the Exchange Act after the distribution of securities      under a plan confirmed by a court. Yes [ ] No [ ] NOT APPLICABLE

Indicate by check mark whether the registrant is a shell company      (as defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [X]      APPLICABLE ONLY TO CORPORATE ISSUERS      State the number of shares outstanding of each of the issuer's classes of common      equity, as of the latest practicable date: The total number of shares of Common      Stock, par value $.001 per share, outstanding as of September 30, 2005, was      43,097,032.

Transitional Small Business Disclosure Format (Check one): Yes [ ] No [X]

----

| **TABLE OF CONTENTS**

**Part I - FINANCIAL INFORMATION**

Item 1. Financial Statements:                    Consolidated Balance Sheets                    Consolidated Statements of Operations                    Consolidated Statements of Cash Flows                    Condensed Notes to the Consolidated Financial Statements            Item 2. Management's Discussion and Analysis or Plan of Operations            Item 3. Control and Procedures

**Part II - OTHER INFORMATION**

Item 1. Legal Proceedings            Item 2. Changes in Securities            Item 3. Defaults Upon Senior Securities            Item 4. Submission of Matters to a Vote of Security Holders            Item 5. Other Information            Item 6. Exhibits and Reports on Form 8-K

**SIGNATURES** |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

**CAUTIONARY INFORMATION ABOUT FORWARD-LOOKING STATEMENTS**

                This document contains forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act.  All statements, other than statements of historical facts, included in or incorporated by reference into this Form 10-QSB which address activities, events or developments which Envirokare Tech Inc., ("Envirokare" or the "Company") expects, believes or anticipates will or may occur in the future are forward-looking statements. The words "believes," "intends," "expects," "anticipates," "projects," "estimates," "predicts" and similar expressions are also intended to identify forward-looking statements.  These forward-looking statements include, among others, statements concerning: expectations, anticipations, beliefs, estimations, projections, and other similar matters that are not historical facts, including such matters as future capital and development expenditures and expansion and growth of business operations.

                These statements are based on certain assumptions and analysis made by the management of Envirokare in light of its experience and its perception of historical trends, current conditions and expected future developments as well as other factors it believes are appropriate in the circumstances.

                Envirokare cautions the reader that these forward-looking statements are subject to risks and uncertainties, including those associated with: the financial environment, general economic, market and business conditions, the regulatory environment, business opportunities that may be presented to and pursued by Envirokare, changes in laws or regulations, availability to obtain additional financing on favorable conditions, trend projections, and other factors, many of which are beyond the Company's control that could cause actual events or results to differ materially from those expressed or implied by the statements.  Such risks and uncertainties include those risks and uncertainties identified in the Description of the Business and Management's Discussion and Analysis sections of this document and risk factors discussed from time to time in the Company's filings with the Securities and Exchange Commission.

                Significant factors that could prevent Envirokare from achieving its stated goals include: the inability of Envirokare to obtain financing for capital expenditures and acquisitions, declines or failure to develop in the market for the Company's products, development of superior products by competition, and adverse changes in the regulatory environment affecting the Company.

                The cautionary statements contained or referred to in this document should be considered in connection with any subsequent written or oral forward-looking statements that may be issued by Envirokare or persons acting on its or their behalf.

                Envirokare undertakes no obligation to release publicly any revisions to any forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

----

**ITEM 1. FINANCIAL INFORMATION:**

| **ENVIROKARE TECH, INC. and SUBSIDIARIES**                                                                            |                            |
|-----------------------------------------------------------------------------------------------------------------------|---------------------------------|
| **CONSOLIDATED BALANCE SHEETS**                                                                                       |                            |
|                                                                                                                  |                            |   |   |   |   |
|                                                                                                                  |                            |   | &nbssp; |   |   | ** September 30,** |   | ** December 31,** |   |
|                                                                                                                  |                            |   |   |   |   | ** 2005** |   | ** 2004** |   |
|                                                                                                                  |                            |   |   |   |   | ** (unaudited)** |   |   |   |
| ** A S S E T S**                                                                                                 |                            |   |  |   |  |   |
|                                                                                                                  | CURRENT ASSETS                  |   |   |   |   |   |   |
|                                                                                                                  |                            | Cash and cash equivalents |   | $ |         2,200,366 | $ |            432,155 |   |
|                                                                                                                  |                            | Accounts receivable |   |   |            285,366 |   |                       - |   |
|                                                                                                                  |                            | Deposits and retainers |   |   |              41,219 |   |              22,466 |   |
|                                                                                                                  |                            | Employee and related party receivables |   |   |                2,186 |   |                1,864 |   |
|                                                                                                                  |                            | Prepaid expenses |   |   |            622,400 |   |                       - |   |
|                                                                                                                  |                            | Inventory |   |   |                       - |   |              43,216 |   |
|                                                                                                                  |                            |   |   |   |   |  |   |  |   |
|                                                                                                                  |                            |   | TOTAL CURRENT ASSETS |   |   |         3,151,538 |   |            499,700 |   |
|                                                                                                                  |                            |   |   |   |   |  |   |  |   |
|                                                                                                                  |                            |   |   |   |   |   |   |   |   |
|                                                                                                                  | PROPERTY AND EQUIPMENT          |   |   |   |   |   |   |
|                                                                                                                  |                            | Furniture and fixtures |   |   |                7,129 |   |                7,129 |   |
|                                                                                                                  |                            | Equipment |   |   |            414,332 |   |              25,292 |   |
|                                                                                                                  |                            | Molds |   |   |              16,000 |   |            170,912 |   |
|                                                                                                                  |                            | Real estate and building |   |   |            400,000 |   |                       - |   |
|                                                                                                                  |                            |   Less accumulated depreciation |   |   |            (39,932) |   |            (12,538) |   |
|                                                                                                                  |                            |   |   |   |   |  |   |  |   |
|                                                                                                                  |                            |   | TOTAL PROPERTY AND EQUIPMENT |   |            797,529 |   |            190,795 |   |
|                                                                                                                  |                            |   |   |   |   |  |   |  |   |
|                                                                                                                  |                            |   |   |   |   |   |   |   |   |
|                                                                                                                  | OTHER ASSETS                    |   |   |   |   |   |   |
|                                                                                                                  |                            | License agreement |   |   |                       - |   |            525,000 |   |
|                                                                                                                  |                            | Prepaid expenses - long term |   |   |            400,000 |   |                       - |   |
|                                                                                                                  |                            | Patents, net |   |   |       10,256,528 |   |         1,958,939 |   |
|                                                                                                                  |                            |   |   |   |   |  |   |  |   |
|                                                                                                                  |                            |   | TOTAL OTHER ASSETS |   |   |       10,656,528 |   |         2,483,939 |   |
|                                                                                                                  |                            |   |   |   |   |  |   |  |   |
|                                                                                                                  |                            |   |   |   |   |   |   |   |   |
|                                                                                                                  |                            | **TOTAL ASSETS** |   | $ |       14,605,595 |  $ |         3,174,435 |   |
|                                                                                                                  |                            |   |   |   |   |  |   |  |   |
|                                                                                                                  |                            |   |   |   |   |   |   |   |   |
| **L I A B I L I T I E S   &   S T O C K H O L D E R S '   E Q U I T Y  ** |                            |   |   |   |   |
|                                                                                                                  | CURRENT LIABILITIES             |   |   |   |   |   |   |
|                                                                                                                  |                            | Accounts payable |   | $ |            275,877 |  $ |            330,933 |   |
|                                                                                                                  |                            | Deposits from customers |   |   |                       - |   |              61,215 |   |
|                                                                                                                  |                            | Deposit owed on exclusivity agreement |   |   |                       - |   |            280,000 |   |
|                                                                                                                  |                            | Accrued compensation |   |   |              94,565 |   |            182,325 |   |
|                                                                                                                  |                            | Accrued interest |   |   |            527,651 |   |              37,835 |   |
|                                                                                                                  |                            | Accrued interest to stockholders |   |   |                       - |   |                8,936 |   |
|                                                                                                                  |                            | Capital equipment lease payable, current portion |   |                6,360 |   |                5,200 |   |
|                                                                                                                  |                            | Notes payable, current portion |   |   |              61,965 |   |              64,902 |   |
|                                                                                                                  |                            | Notes payable to shareholders, current portion |   |            101,801 |   |            100,197 |   |
|                                                                                                                  |                            |   |   |   |   |  |   |  |   |
|                                                                                                                  |                            |   | TOTAL CURRENT LIABILITIES |   |         1,068,220 |   |         1,071,542 |   |
|                                                                                                                  |                            |   |   |   |   |  |   |  |   |
|                                                                                                                  |                            |   |   |   |   |   |   |   |   |
|                                                                                                                  | LONG-TERM LIABILITIES           |   |   |   |   |   |   |
|                                                                                                                  |                            | Capital equipment lease payable, net of current portion |   |                4,631 |   |                5,791 |   |
|                                                                                                                  |                            | Notes payable, net of current portion |   |   |         5,690,297 |   |              10,499 |   |
|                                                                                                                  |                            | Notes payable to shareholders, net of current portion |   |         1,415,478 |   |         1,476,594 |   |
|                                                                                                                  |                            |   |   |   |   |  |   |  |   |
|                                                                                                                  |                            |   | TOTAL LONG-TERM LIABILITIES |   |         7,110,406 |   |         1,492,884 |   |
|                                                                                                                  |                            |   |   |   |   |  |   |  |   |
|                                                                                                                  |                            |   |   |   |   |   |   |   |   |
|                                                                                                                  | MINORITY INTEREST IN SUBSIDIARY |   |   |         5,827,057 |   |                       - |   |
|                                                                                                                  |                            |   |   |   |   |  |   |  |   |
|                                                                                                                  |                            |   |   |   |   |   |   |   |   |
|                                                                                                                  | COMMITMENTS AND CONTINGENCIES   |   |   |                       - |   |                       - |   |
|                                                                                                                  |                            |   |   |   |   |  |   |  |   |
|                                                                                                                  |                            |   |   |   |   |   |   |   |   |
|                                                                                                                  | STOCKHOLDERS' EQUITY            |   |   |   |   |   |   |
|                                                                                                                  |                            | Convertible preferred stock, 10,000,000 shares authorized, |   |   |   |   |   |
|                                                                                                                  |                            |   | $0.001 par value; no shares issued and outstanding |   |                       - |   |                       - |   |
|                                                                                                                  |                            | Common stock, 200,000,000 shares authorized, |   |   |   |   |   |
|                                                                                                                  |                            |   | $0.001 par value; 43,097,032 and 38,943,980 shares |   |   |   |   |   |
|                                                                                                                  |                            |   | issued and outstanding, respectively |   |              43,097 |   |              38,944 |   |
|                                                                                                                  |                            | Additional paid-in capital |   |   |         7,356,741 |   |         5,923,717 |   |
|                                                                                                                  |                            | Stock options and warrants |   |   |         8,110,907 |   |         2,023,258 |   |
|                                                                                                                  |                            | Accumulated deficit during development stage |   |     (14,910,833) |   |       (8,375,910) |   |
|                                                                                                                  |                            |   |   |   |   |  |   |  |   |
|                                                                                                                  |                            |   | TOTAL STOCKHOLDERS' EQUITY |   |            599,912 |   |            610,010 |   |
|                                                                                                                  |                            |   |   |   |   |  |   |  |   |
|                                                                                                                  |                            |   |   |   |   |   |   |   |   |
|                                                                                                                  |                            | **TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY** | $ |       14,605,595 |  $ |         3,174,435 |   |
|                                                                                                                  |                            |   |   |   |   |  |   |  |   |
| The accompanying condensed notes are an integral part of these financial statements.                                  |                            |
|                                                                                                                  |                            |   |   |   |   |   |   |   |   |

----

| **ENVIROKARE TECH, INC. and SUBSIDIARIES**                                           |
|--------------------------------------------------------------------------------------|
| **CONSOLIDATED STATEMENTS OF OPERATIONS**                                            |
|                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                 |   |   |   | **Three Months Ended** |   | **Nine Months Ended** |   |   |
|                                                                                 |   |   |   |  |   |  |   |   |
|                                                                                 |   |   |   | **September 30,** |   | **September 30,** |   | **September 30,** |   | **September 30,** |   |   |
|                                                                                 |   |   |   | **2005** |   | **2004** |   | **2005** |   | **2004** |   |   |
|                                                                                 |   |   |   | **(unaudited)** |   | **(unaudited)** |   | **(unaudited)** |   | **(unaudited)** |   |   |
|                                                                                 |   |   |   |  |   |  |   |  |   |  |   |   |
| REVENUES                                                                             |  $ |          460,139 |  $ |                    -   |  $ |          674,835 |  $ |                    -   |   |   |
|                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |
| COST OF GOODS SOLD                                                                   |   |        (162,843) |   |                    -   |   |        (323,774) |   |                    -   |   |   |
|                                                                                 |   |   |   |  |   |  |   |  |   |  |   |   |
|                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                 | GROSS PROFIT |   |          297,296 |   |                    -   |   |          351,061 |   |                    -   |   |   |
|                                                                                 |   |   |   |  |   |  |   |  |   |  |   |   |
|                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |
| E X P E N S E S                                                                      |   |   |   |   |   |   |   |   |   |   |
|                                                                                 | Consulting fees - related parties |   |            56,308 |   |            88,461 |   |       5,058,709 |   |          267,117 |   |   |
|                                                                                 | Consulting fees - other |   |            54,938 |   |              4,560 |   |          152,016 |   |            61,340 |   |   |
|                                                                                 | Board of directors fees |   |                    -   |   |            89,420 |   |                    -   |   |            89,420 |   |   |
|                                                                                 | Rent |   |            31,347 |   |            27,034 |   |            77,186 |   |            65,346 |   |   |
|                                                                                 | General and administrative |   |          175,976 |   |            65,677 |   |          527,966 |   |          169,914 |   |   |
|                                                                                 | Depreciation and amortization |   |          171,245 |   |              3,054 |   |          370,066 |   |              5,102 |   |   |
|                                                                                 | Professional fees |   |          182,587 |   |            46,884 |   |          309,420 |   |          191,822 |   |   |
|                                                                                 | Research and development |   |          131,573 |   |              1,850 |   |          249,190 |   |              6,909 |   |   |
|                                                                                 | Wages and salaries |   |               (396) |   |              5,843 |   |            19,222 |   |            45,236 |   |   |
|                                                                                 |   |   |   |  |   |  |   |  |   |  |   |   |
|                                                                                 |   | TOTAL EXPENSES |   |          803,578 |   |          332,783 |   |       6,763,774 |   |          902,206 |   |   |
|                                                                                 |   |   |   |  |   |  |   |  |   |  |   |   |
|                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |
| LOSS FROM OPERATIONS                                                                 |   |        (506,282) |   |        (332,783) |   |     (6,412,713) |   |        (902,206) |   |   |
|                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |
| OTHER INCOME (EXPENSES)                                                              |   |   |   |   |   |   |   |   |   |   |
|                                                                                 | Gain on exclusivity agreement |   |                    -   |   |                    -   |   |          280,000 |   |                    -   |   |   |
|                                                                                 | Interest expense |   |        (206,469) |   |          (55,465) |   |        (575,024) |   |        (170,786) |   |   |
|                                                                                 |   |   |   |  |   |  |   |  |   |  |   |   |
|                                                                                 |   | TOTAL OTHER EXPENSE |   |        (206,469) |   |          (55,465) |   |        (295,024) |   |        (170,786) |   |   |
|                                                                                 |   |   |   |  |   |  |   |  |   |  |   |   |
|                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |
| LOSS BEFORE INCOME TAXES                                                             |   |        (712,751) |   |        (388,248) |   |     (6,707,737) |   |     (1,072,992) |   |   |
|                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |
| INCOME TAXES                                                                         |   |                    -   |   |                    -   |   |                    -   |   |                    -   |   |   |
|                                                                                 |   |   |   |  |   |  |   |  |   |  |   |   |
|                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |
| MINORITY INTEREST ALLOCATION                                                         |              5,039 |   |                    -   |   |          172,943 |   |                    -   |   |   |
|                                                                                 |   |   |   |  |   |  |   |  |   |  |   |   |
|                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |
| NET LOSS                                                                             | $ |        (707,712) | $ |        (388,248) |  $ |     (6,534,794) |  $ |     (1,072,992) |   |   |
|                                                                                 |   |   |   |  |   |  |   |  |   |  |   |   |
|                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                 | BASIC AND DILUTED NET LOSS |   |   |   |   |   |   |   |   |   |
|                                                                                 | PER COMMON SHARE | $ | (0.02) | $ | (0.01) |  $ | (0.16) |  $ | (0.03) |   |   |
|                                                                                 |   |   |   |  |   |  |   |  |   |  |   |   |
|                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                 | WEIGHTED AVERAGE NUMBER |   |   |   |   |   |   |   |   |   |
|                                                                                 | OF BASIC AND DILUTED COMMON |   |   |   |   |   |   |   |   |
|                                                                                 | STOCK SHARES OUTSTANDING |   |     41,063,809 |   |     36,659,197 |   |     39,902,098 |   |     35,112,010 |   |   |
|                                                                                 |   |   |   |  |   |  |   |  |   |  |   |   |
|                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |
| The accompanying condensed notes are an integral part of these financial statements. |
|                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |

----

| **ENVIROKARE TECH, INC. and SUBSIDIARIES**      |                                          |
|-------------------------------------------------|-----------------------------------------------|
| **CONSOLIDATED STATEMENTS OF CASH  FLOWS** |                                          |
|                                            |                                          |   |   |   |   |   |   |   |
|                                            |                                          |   |   |   |   |   | **Nine Months Ended** |   |   |   |
|                                            |                                          |   |   |   |   |   |  |   |   |   |
|                                            |                                          |   |   |   |   |   | **September 30,** |   |   | **September 30,** |   |   |   |
|                                            |                                          |   |   |   |   |   | ** 2005** |   |   | ** 2004** |   |   |   |
|                                            |                                          |   |   |   |   |   | ** (unaudited)** |   |   | ** (unaudited)** |   |   |   |
| CASH FLOWS FROM OPERATING ACTIVITIES:           |                                          |  |   |   |  |   |   |   |
|                                            | Net loss                                      |   |   |  $ |          (6,534,794 | ) |  $ |          (1,072,992 | ) |   |   |
|                                            | Loss allocated to minority interest           |   |             (172,943 | ) |   |                        -   |   |   |   |
|                                            |                                          |   |   |   |   |   |  |   |   |  |   |   |   |
|                                            |                                          |   |   |   |   |   |          (6,707,737 | ) |   |          (1,072,992 | ) |   |   |
|                                            |                                          |   |   |   |   |   |  |   |   |  |   |   |   |
|                                            | Adjustments to reconcile net loss to          |   |  |   |   |  |   |   |   |
|                                            |   net cash used by operating activities: |   |  |   |   |  |   |   |   |
|                                            |                                          | Depreciation and amortization |   |               370,066 |   |   |                   5,102 |   |   |   |
|                                            |                                          | Intangible asset expensed |   |                 39,825 |   |   |                        -   |   |   |   |
|                                            |                                          | Impairment of molds |   |               154,912 |   |   |                        -   |   |   |   |
|                                            |                                          | Inventory asset expensed |   |                 43,216 |   |   |                        -   |   |   |   |
|                                            |                                          | Stock options issued for consulting fees |   |            4,747,500 |   |   |                 38,780 |   |   |   |
|                                            |                                          | Stock options issued for directors fees |   |                        -   |   |   |                 89,420 |   |   |   |
|                                            |                                          | Common stock issued for payment of expenses |   |                        -   |   |   |               134,000 |   |   |   |
|                                            | Changes in assets and liabilities:            |   |  |   |   |  |   |   |   |
|                                            |                                          | Accounts receivable |   |             (285,366 | ) |   |                        -   |   |   |   |
|                                            |                                          | Deposits and retainers |   |               (18,754 | ) |   |                        -   |   |   |   |
|                                            |                                          | Customer deposits |   |               (61,215 | ) |   |                 (2,500 | ) |   |   |
|                                            |                                          | Inventory |   |   |                        -   |   |   |                        -   |   |   |   |
|                                            |                                          | Employee and related party receivables |   |                    (322 | ) |   |                        -   |   |   |   |
|                                            |                                          | Prepaid expenses |   |               (22,400 | ) |   |                 (1,605 | ) |   |   |
|                                            |                                          | Accounts payable |   |               (55,056 | ) |   |               116,416 |   |   |   |
|                                            |                                          | Accrued compensation |   |               (87,759 | ) |   |                        -   |   |   |   |
|                                            |                                          | Accrued interest payable |   |               480,881 |   |   |               (11,612 | ) |   |   |
|                                            |                                          | Deposit owed on exclusivity agreement |   |             (280,000 | ) |   |               250,000 |   |   |   |
|                                            |                                          |   |   |   |   |   |  |   |   |  |   |   |   |
|                                            |                                          | Net cash used by operating activities |   |            5,025,528 |   |   |             (454,991 | ) |   |   |
|                                            |                                          |   |   |   |   |   |  |   |   |  |   |   |   |
|                                            |                                          |   |   |   |   |   |  |   |   |  |   |   |   |
| CASH FLOWS FROM INVESTING ACTIVITIES:           |                                          |  |   |   |  |   |   |   |
|                                            |                                          | Patent costs |   |   |                 (6,356 | ) |   |                        -   |   |   |   |
|                                            |                                          | Purchase of equipment |   |               (39,040 | ) |   |                        -   |   |   |   |
|                                            |                                          |   |   |   |   |   |  |   |   |  |   |   |   |
|                                            |                                          | Net cash used in investing activities |   |               (45,396 | ) |   |                        -   |   |   |   |
|                                            |                                          |   |   |   |   |   |  |   |   |  |   |   |   |
|                                            |                                          |   |   |   |   |   |  |   |   |  |   |   |   |
| CASH FLOWS FROM FINANCING ACTIVITIES:           |                                          |  |   |   |  |   |   |   |
|                                            |                                          | Payment of capital equipment lease |   |                        -   |   |   |                 (3,483 | ) |   |   |
|                                            |                                          | Payment of notes payable |   |               (62,910 | ) |   |                 (1,939 | ) |   |   |
|                                            |                                          | Proceeds from sale of common stock |   |            1,036,326 |   |   |               780,750 |   |   |   |
|                                            |                                          | Proceeds from line of credit |   |                 22,400 |   |   |                        -    |   |   |   |
|                                            |                                          | Proceeds from notes payable, related parties (net) |   |                        -   |   |   |               (63,405 | ) |   |   |
|                                            |                                          | Proceeds from minority interest capital contribution |   |            5,000,000 |   |   |  |   |   |   |
|                                            |                                          | Payment on acquisition agreement |   |          (2,500,000 | ) |   |                        -   |   |   |   |
|                                            |                                          |   |   |   |   |   |  |   |   |  |   |   |   |
|                                            |                                          |   |   |   |   |   |  |   |   |  |   |   |   |
|                                            |                                          | Net cash provided by financing activities |   |            3,495,816 |   |   |               711,923 |   |   |   |
|                                            |                                          |   |   |   |   |   |  |   |   |  |   |   |   |
| Net increase in cash                            |                                          |   |            1,768,211 |   |   |               256,932 |   |   |   |
|                                            |                                          |   |   |   |   |   |  |   |   |  |   |   |   |
| Cash and cash equivalents, beginning of period  |                                          |               432,155 |   |   |                 65,809 |   |   |   |
|                                            |                                          |   |   |   |   |   |  |   |   |  |   |   |   |
|                                            |                                          |   |   |   |   |   |  |   |   |  |   |   |   |
| Cash and cash equivalents, end of period        | $                                             |            2,200,366 |   | $ |               322,741 |   |   |   |
|                                            |                                          |   |   |   |   |   |  |   |   |  |   |   |   |
|                                            |                                          |   |   |   |   |   |  |   |   |  |   |   |   |
| SUPPLEMENTAL CASH FLOW INFORMATION:             |                                          |  |   |   |  |   |   |   |
|                                            |                                          | Interest paid |   | $ |               150,520 |   | $ |                   1,072 |   |   |   |
|                                            |                                          |   |   |   |   |   |  |   |   |  |   |   |   |
|                                            |                                          | Income taxes paid | $ |                        -   |   | $ |                        -   |   |   |   |
|                                            |                                          |   |   |   |   |   |  |   |   |  |   |   |   |
|                                            |                                          |   |   |   |   |   |  |   |   |  |   |   |   |
| NON-CASH TRANSACTIONS:                          |                                          |  |   |   |  |   |   |   |
|                                            |                                          | Equipment acquired in acquisition | $ |               350,000 |   | $ |                        -   |   |   |   |
|                                            |                                          | Stock options issued for consulting fees | $ |            4,747,500 |   | $ |                 89,420 |   |   |   |
|                                            |                                          | Stock options issued for directors fees | $ |                        -   |   | $ |                 38,780 |   |   |   |
|                                            |                                          | Common stock issued for payment of expenses | $ |                        -   |   | $ |               134,000 |   |   |   |
|                                            |                                          | Equipment acquired via capital lease | $ |                        -   |   | $ |                   6,132 |   |   |   |
|                                            |                                          | Stock options issued in acquisition | $ |               741,000 |   | $ |                        -   |   |   |   |
|                                            |                                          | Interest imputed on Note to merger entity shareholders | $ |               475,205 |   | $ |  |   |   |   |
|                                            |                                          | Receivable due to LRM (services in kind from NOVA) | $ |            1,000,000 |   | $ |  |   |   |   |
|                                            |                                          | Debt incurred in acquisition of subsidiary's property |   |  |   |   |  |   |   |   |
|                                            |                                          |   | and patents | $ |            8,157,208 |   | $ |                        -   |   |   |   |

----

**NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS**

Envirokare Tech, Inc. (hereinafter, "the Company" or "Envirokare") was incorporated in June 1998 under the laws of the State of Nevada. In December 1998, the Company acquired assets of a business engaged in developing a rubber mold technology and patent rights potentially applicable to future development of a pallet made of recycled materials. The Company believes the early-stage rubber mold technology to be of marginal commercial value.

During 2001, the Company acquired the licensing rights to a proprietary thermoplastic processing technology, the Thermoplastic Flow forming process (variously referred to herein as "TPF Process", the "Process" or "TPF technology"). The licensing agreement provides the Company with the ability to utilize the TPF technology to design, develop, manufacture, market, license and sublicense a wide range of large structural parts, including the Company's proprietary pallet. The pallet is now composed of long-fiber reinforced thermoplastic composite and will be manufactured using the acquired TPF technology.

In March 2005, the Company acquired the assets of Thermoplastic Composite Designs, Inc. (hereinafter "TCD"). These assets were subsequently contributed to LRM Industries, LLC, a joint venture with Nova Chemicals, Inc. (hereinafter "Nova"), to commercialize the Company's TPF technology. The joint venture is being accounted for as a majority control subsidiary, with Nova's interest treated as a minority interest. See Note 10.

The Company's current operating strategy is based on developing products to be manufactured by the TPF Process, as well as marketing the TPF technology to potential sublicensees. The Company maintains offices in Orlando, Florida. The Company has elected a fiscal year-end of December 31.

The Company's consolidated financial statements include the following entities: Electroship Acquisition Corporation, Envirokare Composite Corp., Thermoplastic Composite Designs, Inc., and LRM Industries, LLC.

All inter-company accounts and transactions have been eliminated in the consolidation.s

**NOTE 2 - BASIS OF PRESENTATION**

The foregoing unaudited interim financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-QSB and Regulation S-B as promulgated by the Securities and Exchange Commission ("SEC"). Accordingly, these financial statements do not include all of the disclosures required by generally accepted accounting principles in the United States of America for complete financial statements. These unaudited interim financial statements should be read in conjunction with the audited financial statements for the year ended December 31, 2004. In the opinion of management, the unaudited interim financial statements furnished herein include all adjustments, all of which are of a

----

**NOTE 2 - BASIS OF PRESENTATION (continued)**

normal recurring nature, necessary for a fair statement of the results for the interim period presented.

The preparation of financial statements in accordance with generally accepted accounting principles in the United States of America requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities known to exist as of the date the financial statements are published, and the reported amounts of revenues and expenses during the reporting period.  Uncertainties with respect to such estimates and assumptions are inherent in the preparation of the Company's financial statements; accordingly, it is possible that the actual results could differ from these estimates and assumptions and could have a material effect on the reported amounts of the Company's financial position and results of operations.

Operating results for the nine month period ended September 30, 2005 are not necessarily indicative of the results that may be expected for the year ending December 31, 2005.

Going Concern

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. This basis of accounting contemplates the recovery of the Company's assets and the satisfaction of its liabilities in the normal course of operations. 

As shown in the accompanying financial statements, the Company has incurred an accumulated deficit of $14,910,833 through September 30, 2005, has substantial debt and has minimal revenues. These factors raise substantial doubt about the Company's ability to continue as a going concern.  The Company's financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that might be necessary in the event the Company cannot continue in existence.

**NOTE 3 - PROPERTY AND EQUIPMENT**

Property and equipment are stated at cost. Depreciation is provided using the straight line method over the estimated useful lives of the assets, which range from three to seven years. Molds are depreciated over their estimated useful lives once placed in service. During the quarter ended June 30, 2005, the Company deemed that pallet molds valued at $43,000 were of no commercial value and expensed the value of these molds. Additionally, during the quarter ended September 30, 2005, the Company expensed the value of a top cap and pallet mold valued at $111,912. None of the molds expensed in the current quarter, or the molds previously deemed to be of no commercial value, are carried in valuations of the Company's assets. The costs included in molds as of June 30,

----

**NOTE 3 - PROPERTY AND EQUIPMENT (continued)**

and September 30, 2005 are comprised of design, machining, manufacturing and delivery costs. Costs relating to the Beam mold and are valued at $16,000. This mold is being depreciated over a five year period.  Depreciation expense relating to molds for the nine month periods ended September 30, 2005 and 2004 was $39,932 and $2,048, respectively.

The following is a summary of the Company's property and equipment and related accumulated depreciation:
|                                |   |        | **September 30,** |   |   |        | **December 31,** |   |
|-------------------------------------|--------|--------|-------------------|--------|--------|--------|------------------|--------|
|                                |   |        | **2005**          |   |   |        | **2004**         |   |
|                                |   |        |                   |   |   |        |                  |   |
| Furniture and fixtures              |   | $      |  7,129       |   |   | $      |  7,129      |   |
| Equipment                           |   |        |  414,332     |   |   |        |  25,292     |   |
| Molds                               |   |        |  16,000      |   |   |        |  170,912    |   |
| Buildings                           |   |        |  50,000      |   |   |        |  -          |   |
| Land                                |   |        |  350,000     |   |   |        |  -          |   |
|                                |   |   |                   |   |   |   |                  |   |
|                                |   |        |  837,461     |   |   |        |  203,333    |   |
| Less: Accumulated depreciation |   |        |  (39,932     | )      |   |        |  (12,538    | )      |
|                                |   |   |                   |   |   |   |                  |   |
|                                |   | $      |  797,529     |   |   | $      |  190,795    |   |
|                                |   |   |                   |   |   |   |                  |   |

**NOTE 4 - INTANGIBLE ASSETS**

Intangible assets are tested for impairment on an annual basis. At September 30, 2005, the Company considered the acquisition costs of its intangible assets to be fully recoverable. The Company will commence the amortization of such costs when the assets are placed in service. 

License Agreement

In March 2001, the Company obtained the rights to its TPF process in exchange for cash consideration of $525,000. The licensing agreement provides the Company with the ability to utilize the TPF technology to design, develop, manufacture, market, license and sublicense a wide range of large structural parts, including the Company's proprietary pallet. This license agreement was treated as part of the acquisition costs and eliminations in the acquisition of TCD. See Note 10.

Patents and Patents Pending

The Company acquired rights in an invention and its related provisional patent application entitled "Apparatus and Method for Facilitating Shipping and Commerce" in connection with its December 2000 merger with Electroship Acquisition Corporation. This application expired.  The Company re-filed the application and the patent is presently pending.  The Company is evaluating options to develop aspects of the electronic technology as it relates to shipping and commerce applications. Amortization

----

**NOTE 4 - INTANGIBLE ASSETS (continued)**

expense related to this intangible asset for the nine months ended September 30, 2005 was $84,927. In March 2005, the Company acquired the assets of Thermoplastic Composite Designs, Inc., which included patents and other intellectual property. See Note 10.

**NOTE 5 - NOTES PAYABLE TO SHAREHOLDERS**

During the year ended December 31, 2003, the Company entered into a promissory note arrangement with two Company shareholders, in the principal amount of $100,000.  The unsecured note bears an interest rate of 15% per annum with principal and interest payment payable in 36 equal monthly installments of $3,467 commencing September 1, 2003.  Three common stock warrants are attached to each dollar of debt, with an exercise price of $0.20 per share.  These warrants are fully exercisable for up to three years from the date of issuance.

During the year ended December 31, 2003, the Company entered into a promissory note with a director and shareholder, in the principal amount of $200,000.  The unsecured note bears an interest rate of 15% per annum, with principal and interest payment payable in 36 equal monthly installments of $6,933, commencing January 1, 2003.  Three common stock warrants are attached to each dollar of debt, with an exercise price of $0.20 per share. These warrants are fully exercisable for up to three years.  

Also in December 2003, the Company rolled a portion of its outstanding notes payable and accrued interest to related parties into new notes.  These unsecured notes bear an interest rate of 12% per annum, with interest only payable in equal monthly installments of varying amounts, commencing on January 1, 2004.  Common stock warrants totaling 5,125,000 were attached to these loans, with an exercise price of $0.20 per share.  These warrants are fully exercisable for up to three years from the date of issuance.   

**NOTE 6 - COMMON STOCK**

During the nine months ended September 30, 2005, the Company issued 62,500 shares of its common stock when warrants were exercised at $0.40 per share for a total of $25,000 and 50,000 shares were issued when stock options were exercised at $0.30 per share for a total of $15,000. In addition, the Company issued 614,465 shares of its common stock when options were exercised by a former Company executive at $0.23 per share, with payment set off against severance owing to the former executive. During the period ended September 30, 2005, the Company issued 2,600,000 shares of its common stock when stock warrants were exercised at prices ranging between $0.25 and $0.40 per share. During the period ended September 30, 2005 the Company issued 826,087 shares of its common stock when stock options were exercised at a price of $0.23 per share.

**NOTE 7 - STOCK OPTIONS AND WARRANTS**

Financial Accounting Standards No. 123, "Accounting for Stock-Based Compensation" (hereinafter "SFAS No. 123"), defines a fair value-based method of accounting for stock options and other equity instruments.  The Company has adopted this method, which measures compensation costs based on the estimated fair value of the award and recognizes that cost over the service period. In accordance with SFAS No. 123, the fair value of stock options and warrants granted are estimated using the Black-Scholes Option Price Calculation.  The assumptions utilized to estimate fair values for options and warrants are provided in the respective option and warrant discussion that follows.

Common Stock Options

Summarized information about common stock options outstanding and exercisable at September 30, 2005 is as follows:
|   | **Options Outstanding** |   | **Options Exercisable** |
|--------|-------------------------|--------|-------------------------|
|   |                         |   |                         |
|   | **Exercise Price**      |   |                    | **Number of Shares          Under Options          Outstanding** |   | **Weighted Average          Remaining Contractual          Life (Years)** |   |   | **Weighted Average          Exercise Price** |   | **Number of Shares          Under Options           Exercisable** |   |   | **Weighted Average          Exercise Price** |
|   |                         |   |                    |  |   |  |   |   |  |   |  |   |   |  |
| $      | 0.23                    |   |                    | 6,334,449 |   | 8.02 |   | $ | 0.23 |   | 6,334,449 |   | $ | 0.23 |
|   | 0.30                    |   |                    | 50,000 |   | 4.00 |   |   | 0.30 |   | 50,000 |   |   | 0.30 |
|   | 0.40                    |   |                    | 250,000 |   | 4.00 |   |   | 0.40 |   | 250,000 |   |   | 0.40 |
|   |   0.575            |   |                    | 250,000 |   | 4.00 |   |   |   0.575 |   | 250,000 |   |   |   0.575 |
|   | 0.75                    |   |                    | 600,000 |   | 10.00  |   |   | 0.75 |   | 0 |   |   | 0.75 |
|   | 0.94                    |   |                    | 1,300,000 |   | 2.40 |   |   | 0.94 |   | 1,300,000 |   |   | 0.94 |
|   | 0.965                   |   |                    | 8,830,000 |   | 9.45 |   |   |   0.965 |   | 6,330,000 |   |   |   0.965 |
|   |                         |   |                    |  |   |  |   |   |  |   |  |   |   |  |
| $      | 0.23 - 0.965            |   |                    | 17,614,449 |   | 8.26 |   | $ | 0.68 |   | 14,514,449 |   | $ | 0.62 |
|   |                         |   |                    |  |   |  |   |   |  |   |  |   |   |  |
| **Equity Compensation          Plans Approved by          Shareholders** |   | **Shares Issuable          Upon Exercise of          Outstanding          Options** |   | **Weighted          Average          Exercise Price** |   | **Shares          Available for          Issuance** |
|--------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------------|--------|-------------------------------------------------------|--------|-----------------------------------------------------|
|                                                                          |   |                                                                                     |   |                                                       |   |                                                     |
| 1999 Equity Incentive Plan                                               |   |   650,000                                                                      |   | $0.47                                                 |   |   3,148,579                                    |
|                                                                     |   |                                                                                     |   |                                                       |   |                                                     |

----

**NOTE 7 - STOCK OPTIONS AND WARRANTS (continued)**

Common Stock Options (continued)

Following is a summary of the Company's stock option activity during the nine months ending September 30, 2005:
|                                      |   | **  Shares** |   |   |   | **  Weighted Average          Exercise Price** |
|-------------------------------------------|--------|-------------------|--------|--------|--------|-----------------------------------------------------|
|                                      |   |                   |   |   |   |                                                     |
| Options outstanding at December 31, 2004  |   |  8,375,000   |   |   | $      |  0.25                                          |
| Granted                                   |   |  1,300,000   |   |   |   |  0.94                                          |
| Granted                                   |   |  8,830,000   |   |   |   |  0.97                                          |
| Granted                                   |   |  600,000     |   |   |   |  0.75                                          |
| Exercised                                 |   |  (1,490,551  | )      |   |   |  0.23                                          |
|                                      |   |                   |   |   |   |                                                     |
| Options outstanding at September 30, 2005 |   |  17,614,449  |   |   | $      |  0.68                                          |
|                                      |   |                   |   |   |   |                                                     |

Options issued, year to date, by the Company total 10,730,000 and include the number of shares under options outstanding of 1,300,000 shares issued to LRM employees and consultants, at a strike price of $0.94 per share and a three year exercise period with immediate vesting of the option grants, and 8,830,000 shares issued to the Company's management team and consultants, at a strike price of $0.965 per share and a ten year exercise period. Of the grants issued to Company's management team and consultants, 2,500,000 shares are not included in the options exercisable section of the tabular format above but are included in the options issued section of the tabular format, as the vesting of these options is subject to certain performance criteria that must be met by LRM Industries prior to vesting, with these options being issued to two Company management team members. The Company has calculated the future value of these non-vested option grants to be $1,875,000 and will recognize the effect of this valuation in its financial statements as the vesting criteria are achieved and the option grants become vested. These non-vested options previously discussed are exercisable only if LRM achieves: (i) $40,000,000 in annual revenue or (ii) has 17% profit based on pre tax income, in any 4 calendar years ending December 31, 2005, 2006, 2007 and 2008. In connection with the 1,300,000 options issued to LRM employees and consultants, these options were issued as a part of their respective employment and consulting agreements to retain their services for the newly created joint venture entity, LRM Industries. 

Additionally, the Company granted 600,000 options to Board members during the period ended September 30, 2005, at a strike price of $0.75 per share. These options vest 1⁄2 after one year from the date of issue and 1⁄2 two years after the date of issue, given that the Board members remain in their capacities with the Company. Due to the vesting criteria established for these Board members, the Company will not recognize the effect of the compensation, until such time as the options vest. The assumptions used to calculate the fair value of the options issued to former TCD shareholders are, a risk-free interest rate of 4%, volatility of 94% and a term of three years. The options granted to Company management and consultants were rewards for efforts expended and achievements made

----

**NOTE 7 - STOCK OPTIONS AND WARRANTS (continued)**

Common Stock Options (continued)

by virtue of completion of the merger agreement of TCD into the Company's wholly-owned subsidiary ECC, formation of the joint venture with an established plastics industry partner, NOVA Chemicals, Inc. and for various additional management services provided to the Company since 2003 and as incentive for services to be provided to the Company in future years. The assumptions used to calculate the fair value of the options issued to management and consultants are presently contained in Note 7 as, a risk-free interest rate of 3%, volatility of 72% and a term of ten years. The expense recorded during the period ended June 30, 2005 is $4,747,500 and allocated to Professional fees - related parties and Professional fees - other, in the amounts of $4,653,900 and $93,600, respectively. Any deferred expense will be recorded when it appears likely that the LRM operating performance criteria, as previously set out, will be achieved.

Common Stock Warrants

Summarized information about common stock warrants outstanding and exercisable at September 30, 2005 is as follows:
|                        |   | ** Common Shares          Under Warrants** |   |   | **Exercise Price          Per Share** |   | **Weighted Average          Fair Value Per Share          At Grant Date** |   | **Expiration Date** |
|-----------------------------|--------|-------------------------------------------------|--------|--------|---------------------------------------|--------|---------------------------------------------------------------------------|--------|---------------------|
|                        |   |                                                 |   |   |                                       |   |                                                                           |   |                     |
| Balance, December 31, 2004  |   |  20,390,000                                |   |   | $0.20 - $0.75                         |   | $0.20                                                                     |   | 2/05 - 9/14         |
|                        |   |                                                 |   |   |                                  |   |                                                                      |   |                |
| Exercise of warrants        |   |   (2,562,500                               | )      |   | $0.40                                 |   | $0.25                                                                     |   | 2/06                |
|                        |   |                                                 |   |   |                                  |   |                                                                      |   |                |
| Expiration of warrants      |   |  (20,000                                   | )      |   | $0.75                                 |   | $0.23                                                                     |   | 2/05                |
|                        |   |                                                 |   |   |                                  |   |                                                                      |   |                |
| Reinstatement of warrants   |   |  600,000                                   |   |   | $0.65                                 |   | $0.15                                                                     |   |                |
|                        |   |                                                 |   |   |                                       |   |                                                                           |   |                     |
| Balance, September 30, 2005 |   |  18,407,500                                |   |   | $0.20 - $0.75                         |   | $0.20                                                                     |   |  2/05 - 9/14   |
|                        |   |                                                 |   |   |                                  |   |                                                                      |   |                |

During the period ended December 31, 2003, warrants to purchase common stock of the Company, in the amount of 600,000 shares, were canceled in error. The valuations were reinstated to reflect proper disclosure in this Note 7 and also to properly allocate within the Company's stock options and warrants and additional paid-in-capital balance sheet equity accounts, as reported on the Company's balance sheet, with the correction to be included in the Company's restated financial statements for the period ended December 31, 2003 and reflected in all periodic reporting periods subsequent to that date. The assumptions utilized to estimate the fair value of warrants issued by the Company were specific to the issuance dates of the warrants and the assumptions ranged according to the following: risk-free interest rate of 3 to 4%, terms of 2 to 5 years, strike prices of $0.20 to $0.75 and volatilities of 53% to 101%.

**NOTE 8 - INCOME TAXES**

At September 30, 2005, the Company had net deferred tax assets of approximately $2,476,900, principally arising from net operating loss carryforwards for income tax purposes. The Company calculates its deferred tax asset using a combined State and Federal tax rate of 39.5%. As the Company's management cannot determine that it is more likely than not that the Company will realize the benefit of the net deferred tax asset, a valuation allowance equal to the net deferred tax asset has been established at June 30, 2005. 

The significant components of the deferred tax asset at June 30, 2005 and December 31, 2004 are as follows: 
|                                   |   |   |              |   |            | **September 30,** |             |   |            | **  December 31,** |   |
|----------------------------------------|--------|--------|-------------------|--------|-----------------|-------------------|------------------|--------|-----------------|-------------------------|--------|
|                                   |   |   |              |   |            | **2005**          |             |   |            | **  2004**         |   |
|                                   |   |   |              |   |            |                   |             |   |            |                         |   |
| Net operating loss carryforward        |   | $      |  6,717,737   |   |            | $                 |  5,220,000  |   |
|                                   |   |   |                   |   |            |                   |                  |   |
|                                   |   |   |              |   |            |                   |             |   |                 |                         |   |
| Deferred tax asset                     |   |   |              | $      |  2,653,500 |              |             | $      |  2,060,000 |                    |
|                                   |   |   |              |   |                 |              |             |        |                 |                    |
| Deferred tax asset valuation allowance |   | $      |   (2,653,500 | )      |            | $                 |  (2,060,000 | )      |
|                                   |   |   |                   |   |            |              |                  |   |

At September 30, 2005, the Company had net operating loss carryforwards of approximately $6,718,000, which expire in the years 2018 through 2025. The change in the allowance account from December 31, 2004 to September 30, 2005 was $593,500.

**NOTE 9 - COMMITMENTS AND CONTINGENCIES**

Operating Lease Agreements

The Company entered into a lease of office space in New York, New York on July 1, 2005 for a period of 24 months. Lease payments are currently $4,542 per month, with additional charges for common area services.  The lease payment includes a provision for certain specific telephone and secretarial services. A security deposit was paid in the amount of $8,303.  Total payments under the lease for the nine months ended September 30, 2005 were $13,883.

The Company entered into a lease for office space in Orlando, Florida on September 16, 2002 for a period of 36 months. The lease completed during the current reporting period. A security deposit was paid in the amount of $2,600, and the return of this deposit is pending. Total payments under this lease for the nine months ended September 30, 2005 and 2004 were $24,192 and $8,719 respectively.

The Company entered into a lease for office space in Boca Raton, Florida on February 7, 2001 for sixty months. Lease payments, including charges for common area, are

----

**NOTE 9 - COMMITMENTS AND CONTINGENCIES (continued)**

currently $4,942. A security deposit and last month's rent were paid in the amount of $8,412. A portion of this space is being subleased, with the sublessee reimbursing the Company $3,000 per month.  The Company's net lease payments amount to $2,121. Total net lease payments for the nine months ended September 30, 2005 and 2004 were $23,698 and $5,293, respectively. 

The future minimum lease payments below for the Boca Raton office are the total amount of the payments as if there was no sublease. The Company anticipates the sublease to continue through the end of the lease term.

The Company also records as rent expense, payments to officers and directors for lodging reimbursement, but the Company is not contractually bound by lease agreements to make such payments. For the nine months ended September 30, 2005, the Company recorded $8,865 related to these transactions.

Future annual minimum operating lease payments for the terms of the Orlando and Boca Raton lease agreements are as follows for the years ending December 31:
|   |   |   | **New York          Office** |   |   | **Boca Raton          Office** |   |   | **Total**    |
|--------|--------|--------|------------------------------|--------|--------|--------------------------------|--------|--------|--------------|
|   |   |   |                              |   |   |                                |   |   |              |
| 2005   |   | $      |  13,626                 |   | $      | 15,363                    |   | $      |  28,989 |
| 2006   |   | $      |  54,504            |   | $      |  2,021               |   | $      |  56,525 |
| 2007   |   | $      |   31,794                |   | $      |  -                        |   | $      |  31,794 |

The Company leases its facility in Mims, Florida, which was acquired in the acquisition of TCD, to its joint venture entity, LRM Industries, LLC. The two-year agreement provides for rents of $7,000 per month. These transactions have been eliminated in the consolidation of these financial statements.

Capital Leases Agreements

During the year ended December 31, 2003, the Company acquired computer equipment through two capital leases. The Company recognizes the value of the equipment in property, plant and equipment in the financial statements and the lease liability in both current liabilities and long-term liabilities on the financial statements. The leases, totaling $9,463, are for 36 months, with interest and principal payments of $345 per month. 

During year ended December 31, 2004, the Company acquired additional computer equipment under capital lease agreements. These leases, totaling $6,132, are for 36 months, with interest and principal payments of $222 per month. 

----

**NOTE 9 - COMMITMENTS AND CONTINGENCIES (continued)**

Litigation

The Company is a named defendant in an action filed by Mr. Real Morel in May 2000 in the Supreme Court of British Columbia, Canada. In this action, Mr. Morel alleges non-payment by the Company of amounts due pursuant to demand promissory notes. After consultation with British Columbia legal counsel and a review of the circumstances surrounding the issuance of the notes, the Company has resolved to dispute this liability. Management of the Company believes that the outcome will not have a material adverse effect on the financial position of the Company. Although no further action has been taken with respect to this dispute, the Company intends to proceed to seek a dismissal of this matter through the Supreme Court of British Columbia, and pursue its legal options during the fourth quarter of 2005. Company management believes that it will prevail in this matter and that the outcome of the action will not have a material adverse affect on the Company's operations. Since the creation of the promissory notes as previously described, the Company has accrued interest on the notes. For the period ended September 30, 2005, the accrued interest balance on these promissory notes is $42,469, and this amount is shown in the Company's Balance Sheet under the accrued interest account.

The Company was a named defendant along with others including a director of the Company in a proceeding filed in the Superior Court of Cumberland County, Maine by former employees of Sports Quest of New England LLC ("Sports Quest"), for back wages and penalties, which could have totaled more than $300,000. The Company denied all liability, ownership, or other involvement with Sport Quest LLC. During the period ended September 30, 2005, the Company entered into a settlement agreement with Sports Quest, wherein the Company made payment in the amount of $20,000 to Sports Quest, without admitting to any wrongful actions with respect to allegations as set forth in the proceeding as filed in the Maine court.

The Company was the defendant in an action commenced by its former law firm for unpaid legal services in the amount of $18,952.  The Company filed a motion to dismiss the action, and during the period ended September 30, 2005 the Company entered into a settlement agreement with its former law firm to resolve the dispute for payment of legal services provided.  The Company made payment in the amount of $10,000 to resolve this matter.  This payment is offset in the accompanying financial statements against the previously recorded liability amount of $18,952.

Schaefer Systems International, Inc.

On March 28, 2003, the Company entered into a product development agreement with Schaefer Systems International, Inc., (hereinafter "SSI") wherein the Company would design, develop and produce a quantity of prototypes for field testing. An initial payment of $61,215 was made by SSI to the Company to facilitate the development of a proprietary product.

----

**NOTE 9 - COMMITMENTS AND CONTINGENCIES (continued)**

Schaefer Systems International, Inc. (continued)

The Company has delivered part of the first run of development parts. The initial period of the development contract has expired. Due to changes from both SSI and the company that is constructing the prototypes, the final product has not been finished. The Company believes that the first generation molds produced for SSI under the product development agreement are of no commercial value. Accordingly, the initial payment, previously held as a deposit on account, was recognized by the Company as an expense and charged to research and development costs during the period ended September 30, 2005. 

**NOTE 10 - ACQUISITIONS**

In March, 2005, the Company announced that it had executed a definitive merger agreement in which Thermoplastic Composite Design (hereinafter "TCD") merged with and into the Company's wholly-owned subsidiary, Envirokare Composites Corp. (hereinafter "ECC"). The transaction combined all of TCD's business, including its intellectual property, property, plant and other assets, including contracts with ECC. Upon completion of the merger with TCD into the Company's wholly-owned subsidiary, ECC, the operating assets in TCD were assigned to LRM Industries, LLC ("LRM"), through ECC. TCD, as such, has no operations and LRM is the operating entity. Accordingly, the Company consolidates LRM's operations in its reporting. As a result of the structure as previously described, there are no operating results for TCD to report. LRM reports its financial activities on a quarterly basis and has elected a year end of December 31. The operating activities of LRM are consolidated in the Company's periodic financial reports. The merger agreement provided for an initial payment of $2.5 million to TCD shareholders and a subsequent schedule of payments over a seven-year period totaling $15 million. The current value of this note was determined by applying a discount rate of 12%. The original note value under this discount was $8,157,208, of which $2,500,000 was paid during the quarter. 

The audit of TCD's books and records for the years ended December 31, 2003 and 2004 has not been completed and a determination has yet to be made with respect to any in-process research and development.  The intangible asset recorded in the acquisition of TCD was incorporated into and recorded as patent value, in conjunction with the purchase price of the Company, the inclusion of the TCD license acquired by the Company in March 2001, in the amount of $525,000 and the real property and equipment, as previously discussed.

Following is a summary of the assets acquired under the TCD merger agreement:
| Equipment       |   | $      |  350,000   |
|-----------------|--------|--------|-----------------|
| Real property   |   |   |  400,000   |
| Patents         |   |   |  7,407,208 |
|            |   |   |                 |
| Assets acquired |   | $      |  8,157,208 |
|            |   |   |                 |

----

**NOTE 10 - ACQUISITIONS (continued)**

Also in March, 2005, the Company announced that ECC executed a 50/50 joint venture agreement with Nova Chemicals, Inc., and created a new company, LRM Industries LLC, to commercialize the Company's TPF technology. The Company has contributed its intellectual property rights, technology, manufacturing equipment and all TPF business activities which were acquired through the merger with TCD into the joint venture, while Nova Chemicals has contributed $5,000,000 in cash and has agreed to contribute future services valued at $1,000,000. The joint venture is accounted for as a subsidiary of the Company.

Following is a summary of the net assets contributed to LRM by the Company:
| Equipment              |   | $      |  350,000   |
|------------------------|--------|--------|-----------------|
| Patents                |   |   |  8,673,208 |
|                   |   |   |                 |
| Net assets contributed |   | $      |  9,023,208 |
|                   |   |   |                 |

The value ascribed to contributed patents includes $525,000 previously paid to TCD under a licensing agreement and 1,300,000 common stock options granted to former TCD shareholders, which were valued at $741,000. 

**NOTE 11 - PRIOR PERIOD RESTATEMENT**

During the period ended September 30, 2005, the Company made certain adjustments to its books and records for the year ended December 31, 2003, to correct errors in calculating its previously stated expense arising from the reissuance of certain stock options and warrants, the effect of which carry forward to ensuing reporting periods. The post 2003 financial reporting effects of the previously described adjustments also appear in the Company's accumulated deficit, additional-paid-in capital and stock options and warrants accounts.

These adjustments are summarized as follows: The Company has incurred an additional charge against earnings, in the amount of $457,150, for the year ended December 31, 2003, as a result of an error in calculating the original debt financing charge against earnings, in the amount of $249,648, which charge was recorded in the Company's originally reported financial statements. The assumptions used to value the warrants issued were a risk-free interest rate of 4%, volatility of 69%, a three year life and an exercise price of $0.23 per share. The Company also realized a charge against earnings, in the amount of $44,650, arising from the issuance of stock options previously not included in the Company's calculations, which represent the grant of 250,000 shares at an exercise price of $0.23 per share.  The assumptions used to calculate the value of the options were a risk-free interest rate of 4%, volatility of 69%, with an exercise period of ten years.  The Company also reinstated previously expired warrants, in the amount of 600,000 shares. The value of these warrants had previously been recognized by the Company in its prior reporting as an expense. The resulting effect of the reinstatement of

----

**NOTE 11 - PRIOR PERIOD RESTATEMENT (continued)**

these warrants was in the amount of $13,060 and is shown as a reallocation between the Company's additional-paid-in-capital and stock options and warrants accounts.

**NOTE 12 - DEVELOPMENT STAGE REPORTING**

During the period ended September 30, 2005, the Company has recognized significant revenues from its consolidated joint venture entity, LRM Industries, LLC. As a result, the Company has discontinued its reporting as a development stage enterprise.

----

**ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION**

                Envirokare Tech, Inc. (the "Company" or "Envirokare") is engaged in the application design, development and manufacturing, utilizing proprietary thermoplastic composite technologies including Thermo Plastic Flowforming (the "Process" or "TPFTM").  Subsequent to end of the fiscal year ended December 31, 2004 and upon the closing of the Merger Agreement between the Company's subsidiary Envirokare Composite Corp. ("ECC") and Thermoplastic Composite Designs, Inc ("TCD") and of the Joint Venture Agreement (LRM Industries, LLC, or "LRM") between Envirokare Composite Corp. and NOVA Chemicals, Inc. ("NOVA") described below, the Company's TPFTM business is being conducted through its position and interest in LRM.

*                Technology:*  The TPFTM Process is a proprietary process developed by TCD that enables the manufacture of large structural parts using long-fiber reinforced thermoplastic resins. The Process utilizes recycled or virgin resins and is designed to reuse its own production scrap, thereby eliminating production waste by-products.  TPFTM Process patents have been issued under United States Patent and Trademark Office patent nos. 6,719,551, 6,869,558 and 6,900,547.  These patents provide a system and method for forming an article from thermoplastic material and fiber.

                Historically, advanced composite materials were utilized almost exclusively by the military and aerospace industries where such usage was normally restricted to the manufacture of small parts due to the inordinate cost of hand application, i.e., the process of manually applying layers of composite materials to a mold or shape.  Management believes that the TPFTM Process provides a cost-effective alternative for the in-line production of larger, long-fiber reinforced plastic parts at very low processing costs.  The Process has key advantages over many manufacturing processes currently in use such as compression molding, injection molding and rotational molding. The Company believes that these advantages provide for significant cost savings realized by utilization of the TPFTM Process in the reduced labor required to create larger parts and reduced costs in assembly of larger parts which are made up from a number of smaller components. Material costs will typically also be lower due to the ability of the Process to use recycled materials, reuse of its own production scrap and utilize in-line compounding, which is the process of mixing raw material components as an actual part of the production process.

                The TPFTM Process has application in a broad range of industries including: agriculture, automotive, material handling, transportation, marine, medical, waste management and aerospace.  TPFTM composite products are an advantaged replacement for many wood, aluminum, steel, other metal alloys, concrete, other plastic and fiberglass products, by providing products that have corrosion resistance, are lighter and cost less to manufacture.  As a thermoplastic process, TPFTM has an additional advantage in that it does not emit volatile organic contaminants (VOCs).

                The Company entered into agreements acquiring specific application rights to this technology through license and merger agreements with TCD dated March 30, 2001, wherein the Company, through its wholly-owned subsidiary ECC, was granted rights to commercially exploit the TPFTM Process in certain specific field-of-use applications.

                On March 3, 2005, the Company completed a merger of TCD, a Florida corporation, into ECC resulting in the acquisition of TCD including the assets comprised of real property, plant, equipment and intellectual property, in exchange for cash and notes, as generally outlined below.  These merger terms were modified from the March 30, 2001 merger agreement.

                The "Merger Consideration" equaled the sum of (i) fifteen million dollars ($15,000,000) (the "Fixed Merger Consideration") and (ii) the aggregate amounts payable in accordance with Section (h) of the Merger Agreement: (the "Contingent Merger Consideration"). Following are the general payment terms to TCD Shareholders, as set forth in the Merger Agreement;

               (a) At the Closing, ECC shall pay the Shareholders $2,500,000.

                (b) The balance of the Merger Consideration shall be paid to the TCD Shareholders in eight (8) annual installments following the Closing with the first such payment due on or prior to January 31, 2006 and the last such payment due on or prior to January 31, 2013 (and such payments shall be deemed to be distributed to the Shareholders of TCD in complete liquidation), with each annual payment to be equal to 2.5% of the "Consolidated EBIDTA" of LRM Industries, LLC ("LRM")  for each calendar year, commencing with the calendar year ending December 31, 2005, up to a maximum aggregate of $12,500,000 for all payments under this subsection (b).  LRM is the Company's Joint Venture Company with NOVA Chemicals, Inc.

                (c) In the event that 2.5% of the Consolidated EBIDTA of LRM during the first four years after the Closing Date (ending on December 31, 2008) is less than an aggregate of $2,000,000, ECC shall pay to the Shareholders any amount by which $2,000,000 exceeds 2.5% of the aggregate Consolidated EBIDTA of LRM during this period within 31 days after the end of the fourth year.

                (d) In the event that 2.5% of the Consolidated EBIDTA of LRM during the years five six and seven after the Closing Date (ending on December 31, 2011) total less than an aggregate of $3,000,000, ECC shall pay to the Shareholders any amount by which $3,000,000 exceeds 2.5% of the aggregate Consolidated EBIDTA of LRM during the period, within 31 days after the end of the seventh year.

                (e) At the end of the eighth year (ending December 31, 2012), in the event that the TCD Shareholders have not been paid $15,000,000 by virtue of the payments set forth in Section 2.01 (a), (b), (d) and (e), ECC shall pay on or prior to January 31, 2013, any amount by which $15,000,000 exceeds all monies paid to the Shareholders to date under Section 2.01(a), (b), (d) and so that the total payments made aggregate $15,000,000. 

                (f) In the event that a cash payment is due the Shareholders pursuant to this paragraph, any TCD Shareholder may elect to receive this payment in four equal annual payments beginning at the end of the eighth year set out above.  Unpaid but due balances will carry interest equal to LIBOR plus one percent but not to the extent a Shareholder elects a deferral under the provisions of the prior sentence.

                (g) The assurance of any such payments to be made pursuant to this Section is provided only by ECC and guaranteed by LRM and Parent (Envirokare) as set forth below.  The Parties acknowledge that no such assurance is being provided by NOVA or any of NOVA's affiliates or subsidiaries other than ECC, LRM and Parent.

                (h) Ongoing Payments.  As additional Merger Consideration (the "Contingent Merger Consideration"), beginning January 1, 2013, the Shareholders shall be entitled to receive from ECC payments annually equal to their pro rata share of 1% of the Net Income of LRM payable to the extent of and at the time of distribution of such Net Income to ECC or 90 days after the end of each year, whichever is sooner.

                 The obligations of ECC to pay the Fixed Merger Consideration and the Contingent Merger Consideration are guaranteed by LRM and the Company, and are evidenced by guaranties executed and delivered by the Company and LRM to the TCD shareholders.

                As part of the transaction described above, ECC sold to LRM, under an Asset Purchase Agreement, equipment and other personal property located in Mims, Florida and intellectual property acquired in the merger transaction described in this section. Other than real estate owned and leased to LRM, these assets were substantially all of the assets of ECC sold to LRM as part of the transaction in which ECC acquired a 50% interest in the LRM, the joint venture company (see below).

                On March the 3, 2005, the Company through, its wholly-owned subsidiary ECC, executed a Limited Liability Company Agreement with NOVA creating a Joint Venture Company, LRM, which is a Delaware limited liability company created for the purpose of commercializing the Company's Thermoplastic Flowforming (TPFTM) technology, including but not limited to the manufacture, marketing, sales and/or licensing of the technology.

                LRM is owned one half each by ECC and NOVA and is capitalized as generally set forth in the joint venture agreement between NOVA and ECC as follows:

                1.1 Contribution of Envirokare. ECC shall make no Contributions to the Company, initially, and need not make any additional Contributions unless, in its sole discretion, it decides to do so, subject to approval. ECC is selling certain assets to the Company (i.e. LRM) pursuant to the Asset Purchase Agreement and ECC shall be paid the amounts specified below as consideration for such transfer.

                1.2 Contributions of NOVA. NOVA has made and shall make Contributions to the Company as follows:

                On the date of this Agreement, NOVA will contribute five million dollars ($5,000,000.00) to the Company (the "NOVA Investment").  In addition to the NOVA Investment, NOVA will also contribute one million dollars ($1,000,000.00) in services to the Company (i.e. LRM), pursuant to the NOVA Service Agreement, an exhibit to the Limited Liability Company Agreement.

              As part of the Limited Liability Company Agreement, ECC entered into a lease agreement providing for the lease of the plant property in Mims, Florida to LRM for a period of two years with an option to renew for an additional two years.  Lease payments payable to ECC equal $84,000 per year for the first two years and $91,200 per year for the two year renewal period. In addition, the property is subject to a cellular tower lease providing for additional payments, in the amount of $12,000 per year, to ECC as successor to TCD.

 Product Research, Development and Testing:

*               Product Development -*   Product Research, Development and Testing continued during the period by LRM on a product by product basis, primarily in response to customer product development orders.  During the nine months ended September 30, 2005, LRM announced a research and development contract with the U.S. Government for development of electromagnetic interference composite shelters valued at $1,000,000; a development contract with  Hydrogenics for development of a hydrogen generation system component, and; a development agreement with E.I. duPont de Nemours and Company to explore the utility of the Company's TPFTM technology for a variety of applications within, among other potential industrial market segments, the building and construction markets.

                Product Marketing and Market Exploitation:

                The Company's plan for the marketing and exploitation of its technologies over the next twelve (12) months through LRM, its Joint Venture with NOVA Chemicals, Inc., includes:

                a. direct development and manufacturing of products for materials handling, construction, housing, marine and other commercial and consumer applications.

                b. 3rd party licensing of TPF Technology for specific applications and products as well as for specific geographic areas.

                c. product development for 3rd party applications and licensed manufacturing.

 Purchase of Plant and Significant Equipment and Expected Significant Changes in Number of Employees:

                The closing of the Merger Agreement with TCD and combining that company with Envirokare's wholly-owned subsidiary ECC brought into the Company an existing TPFTM production facility including equipment and leased premises.  The size of this facility is limited and the facility is used primarily for product development and small production runs.  During the current fiscal year, the Company continued preliminary feasibility and development efforts focused on assessing the merits of building a full scale production facility for manufacture of Company and third party products at this facility.  However, no specific manufacturing site has been contracted for to date.  During the near term, the Company's business will be conducted through its position in LRM (see above).  

                The Company anticipates that LRM will add personnel required for operation of the existing facility and to facilitate expansion of the business.  One of the Company's consultants has become a consultant to LRM and the joint venture directly retains personnel to meet various staffing requirements.   The Company does not expect to add key employees to its own staff during the year.

 Liquidity:

                T he Company has budgeted expenditures of $600,000 for the 12 months ending September 30, 2006.  During the nine month period ended September 30, 2005, the Company raised $683,750 through warrant exercises, in addition to receiving $187,300 from the exercise of stock options.  The Company had cash remaining at September 30, 2005 in the amount of $2,200,366, which includes cash balances in LRM, in the amount of $2,097,057.  LRM was initially capitalized with a $5,000,000 contribution in cash and $1,000,000 in services to be provided by NOVA.  LRM has budgeted to spend $1,572,000 during its first year of operation.  The significant changes in assets during the nine month period ended September 30, 2005 were due to (i) the recognition of non-cash prepaid services to be provided by NOVA to LRM during the next two years, with the prepaid services set out as a current prepaid expense, in the amount of $600,000 and long term prepaid expense, in the amount of $400,000, (ii) a change in the net patent amount, as a result of the recognition of consideration received through the merger of TCD into ECC and the formation of the LRM joint venture, which includes the net present value of payments to be made to TCD shareholders as committed to in the merger agreement, the $2,500,000 cash provided to LRM as operating capital at the merger date completion and the inclusion of the $525,000 license fee that the Company paid to TCD during 2001 and that is currently being amortized as a component of the net patent account, as shown on the consolidated Balance Sheet, (iii) the deposits for stock purchase which were applied to the acquisition of common stock upon completion of the transactions during the period ended September 30, 2005, (iv) the increase in accrued interest by $271,546 due to the imputation of interest payable on the net present value of the note payable to TCD shareholders, and (v) the increase in accrued interest due to notes payable to a former director and officer, such payments that are in legal dispute by the Company.  The Company expects to raise any required additional operating funds by sales of shares of its common stock conducted through private placement offerings and through funds received from individuals exercising warrants or options.  Although management believes these capital sources to be sufficient to meet the needs of its operations, there is no assurance that the Company will be successful in raising additional capital to fund its operations.

Operations:         

                The Company had revenues of $460,139 for the three months ended September 30, 2005, in comparison to no revenues for the previous year's corresponding period.   Revenues for the three months ended September 30, 2005 resulted in a Gross Profit of $297,296 with Total Expenses of $803,578 resulting in a Loss From Operations of $506,282, compared to the previous year's corresponding period loss of $332,783.  The interim period for the nine months ending September 30, 2005 showed a loss from operations of $6,412,713 including a one time expense of $4,947,869 for the issuance of market price options to executives and others granted after the closing of the ECC/TCD merger. The period covered by this report also represents the initial operations of LRM, with operations conducted at the facility acquired through the Company's merger with TCD.

**ITEM 3. CONTROLS AND PROCEDURES**

*(a) Evaluation of Disclosure Controls and Procedures*

                We conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of September 30, 2005, the end of the quarterly fiscal period covered by this quarterly report. The controls evaluation was conducted under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of the end of such period, our disclosure controls and procedures are effective to ensure that information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported on a timely basis.

*(b) Changes in Internal Control Over Financial Reporting*

                During the Quarter ended September 30, 2005, in order to assure appropriate control over financial reporting of expanded activities of the Company due to the acquisition of assets from Thermoplastic Composite Design, Inc., the Company increased its disclosure controls. The additional controls include an increased meeting schedule between top executives focused on company activities; an additional level of management review of reports and the adoption of a more aggressive disclosure calendar.

                It should be noted that any system of controls, however well designed and operated, can provide only reasonable, and not absolute, assurance that the objectives of the system will be met. In addition, the design of any control system is based in part upon certain assumptions about the likelihood of future events.

**PART II - OTHER INFORMATION**

**ITEM 1.   LEGAL PROCEEDINGS**

                The Company is a defendant in an action filed by Mr. Real Morel in the Supreme Court of British Columbia, Canada under which the Company was served in May 2000.  Mr. Morel alleges non-payment by the Company of amounts due pursuant to demand promissory notes made by the Company to Mr. Morel during 1998.  The amount claimed is approximately $69,600 including interest.  After consultation with British Columbia legal counsel and a review of the circumstances surrounding the issuance of the notes, the Company has resolved to dispute liability and to advance a set-off and counterclaim.  Management of the Company believes that the outcome will not have a material adverse effect on the financial position of the Company.  Since the fiscal year ended December 31, 2003, no further action has been taken with respect to this matter, by either the Company or Mr. Morel.

                The Company was a defendant along with others, including Steve Pappas, a Director of the Company, in a proceeding filed in the Superior Court of Cumberland County, Maine by former employees of Sports Quest of New England LLC, for back wages and penalties.  The Company denied all liability, ownership or other involvement with Sport Quest LLC.  The Company entered into a settlement agreement with the Plaintiffs in the case which has been fully executed. The result was not material to the Company.

                The Company has filed a Declaratory Judgment action in U.S. District Court for the Southern District of New York against Steve Pappas, a director of the Company. Envirokare is asking that the Voting Trust and Trust Agreement signed by Mr. Pappas on August 7, 2003 be declared valid and in full force and effect until August 7, 2006.  Mr. Pappas had previously made a demand of the Trustee and the Company to terminate this trust.  The demand was rejected. Management expects to resolve this matter in a manner favorable to the Company. Regardless of outcome, management does not believe that this litigation will have any material effect on results of its operations. The docket number of this action is 1:05cv-05515-LAK.

**ITEM 2. CHANGES IN SECURITIES**

              During the nine months ended September 30, 2005, the Company issued 62,500 shares of its common stock when warrants were exercised at $0.40 per share for a total of $25,000 and 50,000 shares were issued when stock options were exercised at $0.30 per share for a total of $15,000. In addition, the Company issued 614,465 shares of its common stock when options were exercised by a former Company executive at $0.23 per share, with payment set off against severance owing to the former executive. During the period ended September 30, 2005, the Company issued 2,600,000 shares of its common stock when stock warrants were exercised at prices ranging between $0.25 and $0.40 per share. During the period ended September 30, 2005 the Company issued 826,087 shares of its common stock when stock options were exercised at a price of $0.23 per share.

**ITEM 3. DEFAULTS UPON SENIOR SECURITIES**

                N one

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

                None

**ITEM 5. OTHER INFORMATION**

 None

**ITEM 6. EXHIBITS****Number    Description of Document**    3.1 Company's Articles of Incorporation, as amended October 12, 1999 (1)    3.2 Company's By-laws as amended and restated December 11, 2000 (2)    10.1 Merger Agreement by and among the Company, Electroship Acquisition (3) Corp., Electroship (N.Y.) Inc., Electroship Partners, John Gremmo, John A. Notarianni, Leo J. Mangan, Raymond Anthony Joao and Richard Reichler, dated as of December 1, 2000    10.2 Assignment of Patent Application from Electroship Partners to (3) Electroship (N.Y.) Inc. and Defined Field of Use License Agreement between Electroship Partners and Electroship (N.Y.) Inc. dated    as of September 20, 2000    10.3 License Agreement between Envirokare Composite Corp. and (2) Thermoplastic Composite Designs, Inc., dated March 30, 2001    10.4 Merger Agreement by and among the Company, Envirokare Composite (2) Corp., Thermoplastic Composite Designs, Inc., Dale Polk, Sr. and Dale Polk, Jr., dated March 30, 2001    10.5 Letter Agreement between the Company and Charles H. Stein, (4) dated May 8, 2001    10.6 Agreement and General Release between the Company and (5) Charles H. Stein, dated November 27, 2001    10.7 SSI Product Development and Purchase Agreement, dated August 6, 2002 (6)    10.8 New Age Shelters Letter Agreement, dated October 1, 2002 (6)    10.9 New Age Shelters Letter Agreement, dated March 20, 2003 (7)    10.10 Promissory Note between the Company and Leo and Betty Kapakos (8)    10.11 Warrant Agreement between the Company and Leo and Betty Kapakos (8)    10.12 Amendment signed the 28th day of September, 2003, amending that (9) certain License Agreement entered into on the 30th day of March, 2001 between Thermoplastic Composite Designs, Inc., a Florida corporation, having a business address of 7400 State Road, #46, Mims, Florida 32754, and Envirokare Composite Corp., a Delaware corporation.    10.13 Amendment signed September 28, 2003 to that certain Merger (9) Agreement dated March 30, 2001, by and among, Envirokare Tech, Inc., a Nevada corporation, and Envirokare Composite Corp., a Delaware corporation and wholly owned subsidiary of Parent, on the one hand, and Thermoplastic Composite Designs, Inc., a Florida corporation, Dale Polk, Sr., an individual, and Dale Polk, Jr., an individual and, together with Polk Sr.,    10.14 Nick Pappas, Executive Chairman of the Board of (10) Directors Letter Agreement    10.15 Nick Pappas, Executive Chairman of the Board of (10) Directors Warrant Agreement    10.16 E. Gary Cook, Director Letter Agreement (10)    10.17 E. Gary Cook, Director Warrant Agreement (10)    10.18 John Verbicky, Director/Chief Executive Officer (10) Compensation Agreement    10.19 John Verbicky, Director/Chief Executive Officer Warrant Agreement (10)    10.20 George Kazantzis, Director/Chief Operating Officer (10) Compensation Agreement    10.21 George Kazantzis, Director/Chief Operating Officer (10) Warrant Agreement    10.22 Jonathan Edelstein, Director Warrant Agreement (10)    10.23 Leo Kapakos, Former Director Warrant Agreement (10)    10.24 Erwin Pruefer, Director of Operations Compensation Agreement (10)    10.25 Erwin Pruefer, Director of Operations Warrant Agreement (10)    21 Subsidiaries of the Company (incorporated herein by reference to Exhibit 21 to the Company's Annual Report on Form 10-KSB for the year ended December 31, 2000, filed with the Commission on April 16, 2001)    31.1 Rule 13a-14(a)/15d-14 Certification of Chief Executive Officer, dated November 14, 2005    31.2 Rule 13a-14(a)/15d-14 Certification of Chief Operating Officer and acting Chief Financial Officer, dated November 14, 2005.    32.1 Section 1350 Certification of President, dated November 14, 2005 and Section 1350 Certification of Chief Operating Officer and acting Chief Financial Officer, dated November14, 2005.

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****SIGNATURES****

                In accordance with Section 13 or 15(d) of the Exchange Act, the Registrant has caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on November 14, 2005.
|   |   |   |   | **ENVIROKARE TECH INC.**                                                                               |
|--------|--------|--------|--------|--------------------------------------------------------------------------------------------------------|
|   |   |   |   | /s/ George Kazantzis

George Kazantzis          President and Principal Financial Officer

  |