U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                 ANNUAL REPORT UNDER SECTION 13 OR 15(D) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                                   FORM 10-KSB

               |X| ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                              FOR FISCAL YEAR ENDED
                                DECEMBER 31, 2005

                           Commission File No. 0-28223

                    CARGO CONNECTION LOGISTICS HOLDING, INC.

        (Exact name of small business issuer as specified in its charter)


             Florida                                         65-0510294
(State or other jurisdiction of                          (I.R.S. Employer
 incorporation or organization)                          Identification No.)

                               600 Bayview Avenue
                             Inwood, New York 11096
                    (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)

                                 (516) 239-7000
                            (ISSUER TELEPHONE NUMBER)


                           Championlyte Holdings, Inc.
                           3450 Park Central Boulevard
                          Pompano Beach, Florida 33064
                            (FORMER NAME AND ADDRESS)

SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT:
                         COMMON STOCK, $0.001 PAR VALUE

INDICATE BY CHECK MARK WHETHER THE REGISTRANT (1) HAS FILED ALL REPORTS REQUIRED
TO BE FILED BY SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 DURING
THE PRECEDING 12 MONTHS (OR FOR SUCH SHORTER PERIOD THAT THE REGISTRANT WAS
REQUIRED TO FILE SUCH REPORTS), AND (2) HAS BEEN SUBJECT TO SUCH FILING
REQUIREMENTS FOR THE PAST 90 DAYS.

YES |X| NO |_|

CHECK IF THERE IS NO DISCLOSURE OF DELINQUENT FILERS IN RESPONSE TO ITEM 405 OF
REGULATION S-B NOT CONTAINED IN THIS FORM, AND NO DISCLOSURE WILL BE CONTAINED,
TO THE BEST OF THE REGISTRANT'S KNOWLEDGE, IN DEFINITIVE PROXY OR INFORMATION
STATEMENT INCORPORATED BY REFERENCE IN PART III OF THIS FORM 10-KSB OR ANY
AMENDMENT TO THIS FORM 10-KSB. |_|

INDICATE BY CHECK MARK WHETHER THE REGISTRANT IS A SHELL COMPANY AS DEFINED
IN RULE 12B-2 OF THE EXCHANGE ACT.
YES |_|  NO |X|

REVENUES FOR YEAR ENDED DECEMBER 31, 2005: $14,661,851

                                       1
<PAGE>

AGGREGATE MARKET VALUE OF THE VOTING COMMON STOCK HELD BY NON-AFFILIATES OF THE
REGISTRANT AS OF May 19, 2006, WAS: $668,264

NUMBER OF SHARES OF THE REGISTRANT'S COMMON STOCK OUTSTANDING AS OF May 19,
2006 IS: 883,903,741

TRANSFER AGENT AS OF May 19, 2006:

                         FLORIDA ATLANTIC STOCK TRANSFER
                               7130 NOB HILL ROAD
                             TAMARAC, FLORIDA 33321




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<PAGE>

Introductory Comment - Forward-Looking Statements

Statements contained in this Annual Report on Form 10-KSB include
"forward-looking statements" within the meaning of Section 27A of the Securities
Act and Section 21E of the Securities Exchange Act that are based on the beliefs
and current expectations of and assumptions made by our management.
Forward-looking statements may be identified by the use of forward-looking
terminology such as "may," "will," "expect," "believe," "estimate,"
"anticipate," "continue" or similar terms, variations of those terms or the
negative of those terms. Forward-looking statements involve known and unknown
risks, uncertainties and other factors which could cause the actual results,
performance and achievements, whether expressed or implied by such
forward-looking statements, not to occur or be realized. Such forward-looking
statements generally are based upon our best estimates of future results,
performance or achievement, based upon current conditions and the most recent
results of our operations. Actual results could differ materially from any
expectation, estimate or projection conveyed by these statements and there can
be no assurance that any such expectation, estimate or projection will be met.
Numerous important factors, risks and uncertainties affect our operating results
and could cause actual results to differ from the results implied by these or
any other forward looking statements. These potential factors, risks and
uncertainties include, among other things, such factors as:

      o     the market acceptance and amount of sales of our services;
      o     our success in increasing revenues and reducing expenses;
      o     our ability to service our debt and other financial obligations,
            particularly if required to pay in cash;
      o     our ability to obtain and manage new growth opportunities;
      o     the competitive environment within the industries in which we
            operate;
      o     our ability to raise or access capital;
      o     our ability to continue as a going concern;
      o     our ability to effectively implement and maintain our internal
            controls and procedures;
      o     our dependence on key personnel;
      o     our ability to timely collect our accounts receivable;
      o     our ability to attract and retain qualified personnel; and
      o     the other factors and information disclosed and discussed under the
            "Risk Factors" section of Item 1 and in other sections of this
            Annual Report on Form 10-K.

      You should carefully consider such risks, uncertainties and other
information, disclosures and discussions which contain cautionary statements
identifying important factors that could cause actual results to differ
materially from those provided in the forward-looking statements.

      Except as may be required, we undertake no obligation to publicly update
or revise any forward-looking statements, whether as a result of new
information, future events or otherwise.


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<PAGE>

                                     PART I

Item 1. - DESCRIPTION OF BUSINESS

Our Business

We were incorporated as Meridian Holdings, Inc. ("Meridian") in Florida in
August 1994 for the purpose of merging, as the surviving entity, with a then
public "shell" entity, MHI Telecommunications, Inc. ("MHI Telecom"). MHI Telecom
was a Delaware corporation that had sold shares to the public pursuant to a
Regulation A exemption from registration during 1969 under its original
corporate name of Pilgrim Mills, Inc. From 1985 through August 1994, MHI Telecom
had not actively been engaged in any business operations.

In August 1994, the shareholders of MHI Telecom and Meridian approved a merger
of MHI Telecom into Meridian and a simultaneous 1 for 40 reverse stock split of
Meridian's outstanding shares. At the same time, the shareholders also
authorized Meridian to raise working capital through appropriate financing, and
to acquire an operating business or otherwise engage in, or conduct, active
business operations. Through the end of 1998, Meridian did not engage in any
fundraising, other than the issuance of shares to certain shareholders in
exchange for services and the advancement of minimal funds on behalf of
Meridian.

On December 3, 1999, Meridian changed its name to Meridian USA Holdings, Inc. On
October 1, 2001, we changed our name to ChampionLyte Products, Inc. and on March
7, 2003, we changed our name to Championlyte Holdings, Inc.

In December 2002, a 67% ownership interest in Old Fashioned Syrup Company, Inc.
("Old Fashioned") was relinquished as part of a foreclosure action on a $15,000
advance made to us in November 2002. As a consequence of losing control of such
business, we recorded Old Fashioned as a discontinued business. In July 2003, we
entered into a Settlement Agreement that returned the 67% ownership interest in
Old Fashioned to us, which became effective August 20, 2003, for $135,000. The
acquisition was accounted for under the purchase method of accounting.

On March 18, 2003, we amended our Articles of Incorporation to change the
authorized stock structure such that the common stock authorized was increased
from 40,000,000 to 200,000,000 shares, and our preferred stock authorized from
100,000 shares to 2,000,000 shares.

On March 25, 2003, we created a subsidiary, Championlyte Beverages, Inc., to
engage in the production and sale of the Championlyte products. On March 17,
2004, we created a subsidiary, Be-Lyte Foods, Inc., to engage in the production
and sale of low carbohydrate snacks. .

On April 27, 2005, we amended our Articles of Incorporation to change the
authorized stock structure such that the common stock authorized was increased
from 200,000,000 to 750,000,000 shares.

On May 12, 2005, Championlyte Holdings, Inc. purchased all of the outstanding
shares of Cargo Connection Logistics Corp. and Mid-Coast Management, Inc. for a
total of seventy percent (70%) of the issued and outstanding shares of common
stock of Championlyte Holdings, Inc. pursuant to a Stock Purchase Agreement and
Share Exchange among Championlyte Holdings, Inc., a Florida corporation, Cargo
Connection Logistics Corp., a Delaware corporation and Mid-Coast Management,
Inc., an Illinois corporation. As additional consideration, Championlyte
Holdings, Inc. will issue shares of preferred stock to Cargo Connection
Logistics Corp. and Mid-Coast Management, Inc., which are convertible into
common stock of Cargo Connection Logistics Holding, Inc. twelve (12) months from
the closing date of the this transaction so that Cargo Connection Logistics
Corp. and Mid-Coast Management, Inc. will own eighty percent (80%) of the
outstanding shares of Championlyte Holdings, Inc.

On May 23, 2005, Championlyte Holdings, Inc. changed its name to Cargo
Connection Logistics Holding, Inc.

On November 8, 2005, we amended our Articles of Incorporation to change the
authorized stock structure such that the common stock authorized was increased
from 750,000,000 to 1,500,000,000 shares.


                                       4
<PAGE>

On February 14, 2006, we amended our Articles of Incorporation to change the
authorized stock structure such that the common stock authorized was increased
from 1,500,000,000 to 5,000,000,000 shares.

Product Overview

On May 12, 2005, Cargo Connection Logistics Holding, Inc. (f/k/a Championlyte
Holdings, Inc.) began operating in the transportation and logistics industry as
a third party logistics provider of transportation and management services,
through its subsidiaries, Cargo Connection Logistics Corp. and Mid-Coast
Management, Inc., to its target client base, ranging from mid-sized to Fortune
100(TM) companies. This is accomplished through its network of terminals and
transportation services via the complementary services these companies offer to
its customers.

Cargo Connection Logistics Corp. is a provider of logistics solutions for global
partners through its network of branch locations and independent agents in North
America. We are predominately a non-asset based transportation provider which
provides truckload and less-than-truckload (LTL) transportation services
utilizing some company equipment, dedicated owner operators and through our
relationships with transportation companies. We select and hire the
transportation services to manage our customers' needs through approved contract
carriers. A core competency is specializing in time-definite transportation
which offers our customers expedited, dedicated and exclusive use vehicles.
Exclusive use services require pinpoint and time sensitive coordination for
those customers that require it. Our management estimates the expedited market
in the United States will be in excess of 2 billion dollars per years, growing
as manufacturers shift even more to just-in-time inventories and leaner supply
chains. We believe our footprint within the expedited transportation services
niche and our complete understanding of the supply chain will give us
opportunities to expand at a substantial rate for the foreseeable future.

In addition to the expedited business that we are currently in, Cargo Connection
Logistics Corp., in 2006, will be extending its operating authority and
insurance to smaller companies that have their own customers along with their
own base of operations. This sector of the business is referred to within the
industry as "agents." Agents typically have an office from which they operate
and control between two million and five million dollars worth of business.
Cargo Connection Logistics Corp., through its systems, would provide these
agents with insurance, authority and back office functionality to assist them in
operating their business. Typically, an agent will pay the company between 15
and 21 percent of the gross revenue depending upon the particular customer base,
their credit worthiness and the support that the customers will require from the
company. This portion of the business generally will add trucks to our fleet.
However, these trucks must meet all of the standards that the company uses as a
benchmark from its safety department. We would expect the revenue from each
agent to be between 5 and 7 percent net revenue to the company.

Cargo Connection Logistics Corp. and Mid-Coast Management, Inc. provide a wide
range of value-added logistics services which include U.S. Customs Bonded
warehouse facilities and container freight station operations. The services
provided are specifically designed to enhance and to support the customer's
supply chain logistics needs through operational excellence and value-added
services. This is accomplished through innovative solutions taking into account
the specific diversified markets of our customers. Some of the value-added
services that can be provided are pick and pack services, special projects that
will include changing labels or tickets on items, inspection of goods into the
United States and recovery of goods damaged in transit. Our variable cost
business model allows us to be flexible and adapt to changing economic and
industry conditions. We also keep our personnel and other operating expenses as
variable as possible. We believe that our decentralized branch network is a
major competitive advantage which allows our customers to better use available
capacity from Ocean and Air Carriers. Our network of offices located in Atlanta,
GA; Bensenville, IL; Charlotte, NC; Columbus, OH; Inwood, NY; Pittsburgh, PA;
and San Jose, CA support our core strategy of serving customers locally
nationally and globally. The services provided are specifically designed to
enhance and to support the customer's supply chain logistics needs through
operational excellence and value-added services. This is accomplished through
innovative solutions taking into account the specific diversified markets of our
customers. This is very important facet in logistics because it is so dynamic
and market-driven based upon available capacity.

We are dedicated to providing our customers with premium services that can be
customized to meet the individual needs of our customers and are flexible enough
to cope with an ever-changing business environment. With these organizations, we
are able to target a gross profit of 15% of gross revenue. In addition to the
functions that we are already providing, we are expanding into new markets.


                                       5
<PAGE>

                                  RISK FACTORS

We have a limited public operating history with significant losses and expect
losses to continue for the foreseeable future. Should we continue to incur
losses for a significant amount of time, the value of your investment in our
common stock could be adversely affected and you could even lose your entire
investment.

We have yet to establish any public history of profitable operations as shown in
our independent certified financial audit for 2005 and 2004. As of December 31,
2005, we had an accumulated deficit of $8,234,027. We have incurred annual
operating losses of $3,703,674 for the year ended December 31, 2005 and $920,594
for the year ended December 31, 2004. As of December 31, 2005, we had an
accumulated shareholder deficit of $5,880,630. We have financed our operations
through loans from our officers, employees, and outside investors, sales of our
common stock in a private placement and by the corporation selling stock to
investors. Our revenues have not been sufficient to sustain our operations. We
will require additional financing to sustain our operations, without which we
may not be able to continue operations. In addition, the terms of the secured
convertible debentures issued to certain selling stockholders require that we
obtain the consent of such selling stockholders prior to our entering into
subsequent financing arrangements. No assurance can be given that we will be
able to obtain additional financing, on terms that are favorable to us or that
the holders of the secured debentures will provide their consent to permit us to
enter into subsequent financing arrangements. This can lead to the reduction or
suspension of our operations and ultimately our going out of business. Should
this occur, the value of your investment in the common stock could be adversely
affected, and you could even lose your entire investment.

We will need to raise additional funds through the public market, private debt
or private sales of equity to achieve our current business strategy. Our need to
raise additional funds in the future will likely involve the issuance of
additional shares of stock, which could dilute the value of your investment.
There is no assurance, however, that we will be able to raise additional monies
in the future.

Our inability to raise additional working capital or to raise the required
financing in a timely manner would negatively impact our ability to fund our
operations, our ability to generate revenues and to otherwise execute our
business plan. Should this occur, the value of your investment in the common
stock could be adversely affected and you could even lose your entire
investment. Therefore, you may be investing in a company that will not have the
funds necessary to continue operations. Our inability to obtain financing would
have a material adverse effect on our ability to implement our development
strategy, and as a result, could require us to diminish or suspend our
development strategy and possibly cease our operations

We have issued secured convertible debentures that may restrict our ability to
obtain additional financing.

We have issued a two-year secured debenture in 2005 that is convertible into
shares of our common stock to Montgomery Equity Partners, LP, an affiliate of
Cornell Capital Partners, LP. Under the terms of the secured debentures, we are
restricted in our ability to issue additional securities as long as any portion
of the principal or interest on the secured debentures remains outstanding.
Specifically, we may not, without the prior consent of the holders of the
secured debentures, issue any common stock at a discount to its fair market
value or issue any derivative security, such as warrants or options, convertible
into common stock at less than fair market value. We are also precluded under
the terms of the secured debentures from granting any third party a security
interest in our assets. Our inability, without the secured debenture holders'
consent, to provide a discount on our stock or to grant a security interest
could make it difficult to find parties willing to make additional investments
in us or to loan us money and therefore could adversely affect our ability to
raise additional funds.

The sale of common stock by investors after delivery of a conversion notice
could have a depressive effect on the price of our common stock. In addition, we
do not intend to disclose the timing of any conversion notices which we may
receive from the investors and as a result, you will have no knowledge of when
the investors are converting into shares of common stock.

The secured convertible debentures are convertible into shares of our common
stock at a conversion price equal to the lesser of (i) 120% percent of our
market price at the time that our stock is first approved for quotation on the
OTC Bulletin Board or (ii) at a 20% discount to the evaluated price of the
common stock prior to the conversion. The method used to price the shares
convertible under the secured debentures may be selected by Montgomery Parters,
LP. While the term sheets related to the Securities Purchase Agreements with
Montgomery Equity Partners, LP, contained provisions prohibiting them from
engaging in short sales, the investors may, nevertheless, engage in the sale of
escrowed shares after delivering a conversion notice to us but before actual
delivery of the shares. In the event that Montgomery was to engage in any such
sales, this may create downward pressure on the price of our common stock and
could result in higher levels of volatility. Further, any resulting decline in
the price of our stock will result in increased dilution due to the fact that we
would be required to issue greater numbers of shares upon receiving future
conversion notices. In addition, not only the sale of shares issued upon
conversion of secured debentures, but also the mere perception that these sales
could occur, may adversely affect the market price of the common stock. In
addition, we do not intend to disclose the timing of conversion notices which we
may receive from Montgomery. As a result, you will have no knowledge of when the
investors are converting. Further, you will not know that the investors have
shares of our common stock that they may be imminently selling, or that the
investors have sold such shares, all of which may have a depressive effect on
the price of our common stock.


                                       6
<PAGE>

The issuance of shares of our common stock upon conversion of the secured
convertible debentures may result in substantial dilution to the interests of
other stockholders since the selling stockholders may ultimately convert and
sell the full amount issuable on conversion. There is no upper limit on the
number of shares that may be issued which will have the effect of further
diluting the proportionate equity interest and voting power of holders of our
common stock, including investors in this offering.

If we are required for any reason to repay our outstanding secured convertible
debentures, we may be required to deplete our working capital, if available, or
raise additional funds. Our failure to repay the secured convertible debenture,
if required, could result in legal action against us, which could require the
sale of substantially all of our assets.

Any event of default in our obligations to the holders of the secured
convertible debentures, such as our failure to pay the principal and interest
when due, our failure to issue shares of common stock upon the conversion by the
holder, our failure to timely file a registration statement or have such
registration statement declared effective, breach of any covenant,
representation or warranty in the securities purchase agreements for such
secured convertible debentures or in the secured convertible debentures, the
commencement of a bankruptcy, insolvency, reorganization or liquidation
proceeding against us and the delisting of our common stock could require the
early repayment of the secured convertible debentures if the default is not
cured with the specified grace period. We anticipate that the full amount of the
secured convertible debentures, together with accrued interest, will be
converted into shares of our common stock, in accordance with the terms of the
secured convertible debentures. If we were required to repay the secured
convertible debentures, we would be required to use our limited working capital
and raise additional funds. If we were unable to repay the secured debentures
when required, the debenture holders could commence legal action against us and
foreclose on all of our assets to recover the amounts due. Any such action would
require us to curtail or cease operations.

Our security agreements with Montgomery Equity Partners, LP contain negative
covenants which restrict our ability to create security interests, change
management, declare dividends, make loans and incur additional indebtedness,
without Montgomery's prior written consent.

In connection with the securities purchase agreements for our secured
convertible debentures with Montgomery Equity Partners, LP (effective December
29, 2005), the company granted Montgomery a secured interest in all of our
assets. In accordance with such agreement, we may not, without Montgomery's
written consent, directly or indirectly:

      o     permit to exist any assignment, transfer, pledge, mortgage, security
            interest or other lien or encumbrance in or against any part of the
            pledged property;

      o     materially change our ownership, executive staff or management.

      o     declare or pay any dividend of any kind, in cash or in property, on
            any class of our capital stock, or make any distribution of any kind
            in respect thereof;

These restrictions could impede our ability to obtain additional funding to
finance our ongoing operations, which would have a negative impact on our
business and the value of your investment.


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<PAGE>

The Company's inability to retain its key executive officers would impede our
business plan and growth strategies, which could have a negative impact on our
business and the value of your investment

Our success depends, to a critical extent, on the continued efforts and services
of our Chairman of the Board and Chief Executive Officer, Jesse Dobrinsky, our
Chief Operating Officer and Chief Financial Officer, Scott Goodman and our Vice
President and Head of New Business Development, John L. Udell. Were we to lose
one or more of these key executive officers, we would be forced to expend
significant time and money in the pursuit of a replacement, which would result
in both a delay in the implementation of our business plan and also the
diversion of our limited working capital. There is no assurance that we can find
satisfactory replacements for these key executive officers at all, or on terms
that are not unduly expensive or burdensome to our Company.

Competition

Our competition is from companies that move expedited Airfreight and cargo. We
are working on negotiating joint ventures that could provide the Company with
additional licenses to provide us with the capabilities to provide our customers
with a full service solution to their supply chain needs. While we compete
directly with our competitors on Expedited L-T-L service which we provide from
our facilities that go airport to airport, we also use many outside vendors and
independent contractors to control the number of assets the company needs to
maintain.

In addition, our warehouse operations have integration into our transportation
system which allow complete tracking of cargo from arrival into the United
States through the United States Customs clearance process. Once the cargo has
cleared customs the directions for distribution can be sent via any mode of
communications (EDI, E MAIL, FAX or VOICE). These services maybe provided by
Cargo Connection or a third party that the customer has chosen. The integration
of the transportation and warehouse systems provide our customers with complete
visibility to their goods through the entire import process.

Once we begin our overseas operations, which we expect to start during the
second quarter of 2006, the visibility of freight will begin once the goods exit
the factory, assuming the customer will provide us with visibility to that
information. We could provide these services today through the world-wide web.

Reliance on Independent Agents

The Company presently relies in small part upon the services of independent
agents to market its transportation services, to act as intermediaries with
customers and to provide services on behalf of the Company. Although the Company
believes its relationship with its agents is satisfactory, there can be no
assurance that the Company will continue to be successful in retaining its
agents or that agents who terminate their contracts can be replaced by other
equally qualified companies. Because the agents occasionally have the primary
relationship with customers, some customers could be expected to terminate their
relationship with the Company if a particular agent were to terminate his or her
relationship with the Company.

Characteristics of the Logistics Industry

As a participant in the logistics services industry, the Company's business is
dependent upon a number of factors including the availability of transportation
equipment and warehousing and distribution facilities at cost-effective rates
and on reasonable terms and conditions. Such services and facilities are often
provided by independent third parties. Shortages of cargo space are most likely
to develop in and around the holiday season as well as in those exceptionally
heavy transportation lanes. Shortages in available space could also be triggered
by economic conditions, transportation strikes, regulatory changes and other
factors beyond the control of the Company. The future operating results of the
Company could be materially adversely affected by significant shortages of
suitable cargo space and associated increases in rates charged by providers of
such cargo space. In addition, if the Company were unable to secure sufficient
equipment or attract and retain sufficient personnel, drivers and
owner-operators to meet is customers' needs, its results of operations could be
materially adversely affected. Finally, the Company's operating results would be
materially adversely affected if the Company's production would be limited to
transportation-based services which are typically lower margin and subject to
greater competitive pressures than logistic services.


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Vulnerability to Economic Conditions

The Company's future operating results may be dependent on the economic
environments in which it operates. Demand for the Company's services could be
materially adversely affected by economic conditions in the industries of the
Company's customers. Interest rate fluctuations, economic recession, customer's
business cycles, availability of qualified drivers, changes in fuel prices and
supply, increases in fuel or energy taxes and the transportation costs of third
party carriers are all economic factors over which the Company has little or no
control. Increased operating expenses incurred by transportation carriers can be
expected to result in higher transportation costs, and the Company's operating
margins would be materially adversely affected if it were unable to pass through
to its customers the full amount of increased transportation costs. Economic
recession or a downturn in customers' business cycles, particularly in
industries in which the Company has a large number of customers, could also have
a material adverse effect on the Company's operating results due to reduced
volume of loads shipped. The Company expects that demand for the Company's
services (and, consequently, its results of operations) will continue to be
sensitive to domestic economic conditions and other factors beyond its control.

Government Regulation

The Company's operations are subject to various state, local, federal and
foreign regulations that in many instances require permits and licenses. In
1996, responsibility for oversight of motor carriers, brokers and freight
forwarders was assumed by the Surface Transportation Board (the "STB") and the
Federal Highway Administration (the "FHWA") both of which are part of the
Department of Transportation (the "DOT"). The FHWA prescribes qualifications for
acting in this capacity, including certain surety bonding requirements. The
Company's motor carrier operations are subject to safety regulations of the FHWA
related to such matters as hours of service by drivers, equipment inspection and
equipment maintenance. The Company is also a common carrier and a contract motor
carrier regulated by the STB and various state agencies. The Company is subject
to various U.S. environmental laws.

Any violation of the laws and regulations discussed above could increase claims
and/or liability, including claims for uninsured punitive damages. Violations
also could subject the Company to fines or, in the event of a serious violation,
suspension, revocation or operating authority or criminal penalties. All of
these regulatory authorities have broad powers generally governing activities
such as authority to engage in motor carrier operations, rates and charges, and
certain mergers, consolidations and acquisitions. Although compliance with these
regulations has not had a material adverse effect on the Company's operations or
financial condition in the past, there can be no assurance that such regulations
or changes thereto will not materially adversely impact the Company's operations
in the future.

Certain federal officials have announced that they are considering implementing
increased security measures with respect to cargo. There can be no assurance as
to what, if any, regulations will be adopted or what, if adopted, their ultimate
effect on the Company will be. Failure of the Company to maintain required
permits or licenses, or to comply with applicable regulations, could result in
substantial fines or revocation of the Company's operating authorities.

Pick-Up and Delivery Claims Exposure

The Company utilizes the services of a significant number of drivers in
connection with its local pick-up and delivery operations as well as
over-the-road transportation needs. From time to time such drivers are involved
in accidents. Although most of these drivers are independent contractors, there
can be no assurance that the Company will not be held liable for the actions of
such drivers. The Company currently carries, or requires its independent
owner-operators to carry, liability insurance in varying amounts, depending on
the State and which operations are being conducted, for each such accident.
However, there can be no assurance that claims against the Company will not
exceed the amount of coverage. If the Company were to experience a material
increase in the frequency or severity of accidents, liability claims or workers'
compensation claims, or unfavorable resolutions of claims, the Company's
operating results and financial condition could be materially adversely
affected. In addition, significant increases in insurance costs could reduce the
Company's profitability.

Employees

As of December 31, 2005, we employed a core group of approximately 85 persons,
including executive officers, managers, supervisors, drivers, warehouse workers,
sales and clerical personnel. We will employ additional people as we continue to
implement our plan of operation. None of our employees are covered by a
collective bargaining agreement and we believe that our relationship with our
employees is satisfactory.


                                       9
<PAGE>

Item 2. - DESCRIPTION OF PROPERTY

We currently lease and/or utilize the following properties:

      o     Inwood, New York (Corporate)
            o     80,000 Total Square Feet of which 18,400 sq. ft. is utilized
                  for office space and the remainder is warehouse.

      o     Atlanta, Georgia
            o     27,520 Total Square Feet of which 4,120 sq. ft. is utilized
                  for office space and the remainder is warehouse.

      o     Bensenville, Illinois
            o     92,000 Total Square Feet of which 20,000 sq. ft. is utilized
                  for office space and the remainder is warehouse

      o     Columbus, Ohio
            o     52,000 Total Square Feet of which 7,360 sq. ft. is utilized
                  for office space and the remainder is warehouse.

      o     Miami, Florida
            o     36,480 Total Square Feet of which 5,470 sq. ft. is utilized
                  for office space and the remainder is warehouse.

      o     Pittsburgh, Pennsylvania
            o     7,500 Total Square Feet

      o     Charlotte, North Carolina
            o     60,000 Total Square Feet

      o     San Jose, California
            o     20,000 Total Square Feet

We consider our facilities to be sufficient for our present uses and our
anticipated future operations. We also believe that the above noted properties
are adequately covered by insurance and are in good physical condition.

Item 3. - LEGAL PROCEEDINGS

The Company is party to a number of legal actions, which are not material to
business operations.

Cargo Connection is a plaintiff in the U.S. Bankruptcy Court for the District of
Maryland with other non-related entities to obtain amounts due from Air Cargo
Inc. ("ACI"), of which Cargo Connection is a trade creditor, totaling
approximately $786,000. ACI had filed for relief under the U.S. Bankruptcy Code
Chapter 11 in December, 2004. In addition, there are lawsuits in other courts
against ACI's customers to collect amounts relating to the customers who owe
monies to ACI.

In connection with the ACI bancruptcy, Cargo Connection was also named as a
third party defendant by ACI in its cause of action against Air France, one of
ACI's customers. That proceeding has been resolved through the mediation
process. A final order is pending and Cargo Connection has no liability in this
case.

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

None.


                                       10
<PAGE>

                                     PART II


Item 5. - MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT'S COMMON EQUITY AND
OTHER STOCKHOLDER MATTERS

As of May 19, 2006, our Transfer Agent's records indicate that there were 464
shareholders of record of our common stock owning 883,903,741 shares.

Our common stock trades on The National Association of Securities Dealers, Inc.
Electronic Bulletin Board (the "OTC Bulletin Board"). On April 30, 2003, the
Company changed its name to Championlyte Holdings, Inc. and commenced trading on
the OTC Bulletin Board under the symbol CPLY. On May 26, 2005 we changed our
name to Cargo Connection Logistics Holding, Inc. and we changed our name to
Cargo Connection Logistics Holding, Inc. and our ticker symbol was changed to
"CRGO". The following table represents the closing high and low bid information
for our common stock during the last two fiscal years as reported by the OTC
Bulletin Board. The quotations reflect inter-dealer prices, without retail
mark-up, mark-down or commission and may not represent actual transactions. The
market for our common stock is sporadic.

--------------------------------------------------------------------------------
     2006                             High                       Low
--------------------------------------------------------------------------------
First Quarter                        $.0119                     $.0031

================================================================================
      2005                            High                        Low
--------------------------------------------------------------------------------

  First Quarter                       $.057                      $.021

Second Quarter(1)                     $.035                      $.013

  Third Quarter                       $.0263                     $.0041

 Fourth Quarter                       $.0109                     $.002

================================================================================
      2004                            High                        Low
--------------------------------------------------------------------------------

  First Quarter                       $.21                       $.13

 Second Quarter                       $.23                       $.11

  Third Quarter                       $.111                      $.055

 Fourth Quarter                       $.075                      $.035


--------
(1)   On May 12, 2005, pursuant to a Stock Purchase Agreement and Share Exchange
      among Cargo Connection Logistics Holding, Inc. f/k/a Championlyte
      Holdings, Inc., a Florida corporation, Cargo Connection Logistics Corp., a
      Delaware corporation and Mid-Coast Management, Inc., an Illinois
      corporation, Cargo Connection Logistics Holding, Inc. purchased all of the
      outstanding shares of Cargo Connection Logistics Corp. and Mid-Coast
      Management, Inc. for a total of seventy percent (70%) of the issued and
      outstanding shares of common stock of Cargo Connection Logistics Holding,
      Inc.


                                       11
<PAGE>

Dividend Policy

No dividends have ever been declared by the Board of Directors of Cargo
Connection on its common stock. At the present time Cargo Connection does not
anticipate paying dividends, cash or otherwise, on it's common stock in the
foreseeable future. Future dividends will depend on earnings, if any, of Cargo
Connection, its financial requirements and other factors.

Stock Option Grants In The Past Fiscal Year

During the quarter ended March 31, 2005, David Goldberg, the then President of
the Company was granted options pursuant to his June 2003 employment agreement
to purchase 100,000 shares of the Company's common stock, which are exercisable
at $0.03 per share. The employment agreement entitled Mr. Goldberg, as long as
he was employed with the Company, to purchase 100,000 shares of the Company's
common stock for each 90-day period through the term of the employment
agreement. All options would have a term of two years. The options are
exercisable at a price equal to 100% of the closing price of the stock as of the
grant date. The options become fully exercisable on the date of grant. During
the year ended December 31, 2005 the fair value of the options using the
Black-Scholes Option Pricing Model was $3,000 and was being amortized to
compensation expense over the term of the employment agreement. Upon the
resignation of the President, which occurred concurrently with the reverse
acquisition, any unamortized compensation was expensed as compensation in the
statement of operations.


                                       12
<PAGE>

DESCRIPTION OF CAPITAL STOCK

Common Stock

The Company is authorized to issue 5,000,000,000 shares of common stock, $0.001
par value per share, of which 883,903,741 shares of common stock were issued and
outstanding at May 19, 2006. All shares have equal voting rights and are not
assessable. Upon liquidation, dissolution, or winding up of the Company, the
assets of the Company, after the payment of liabilities, will be distributed pro
rata to the holders of the common stock. The holders of the common stock do not
have preemptive rights to subscribe for any securities of the Company and have
no right to require the Company to redeem or purchase their shares.

Preferred Stock

The Company currently has designated the preferred stock into the following
Series:

o     Series III: The Company amended its articles of incorporation in April
      2003 and created 500,000 shares of Blank Check Series III Preferred Stock
      ("Series III"), $1.00 par value. The Series III preferred stock may be
      issued in one or more series, and each series will be so designated as to
      distinguish the shares thereof from the shares of all other series. The
      Board of Directors has express authority to fix, before the issuance of
      any shares of a particular series, the number, designation, and relative
      rights, preferences and limitations of the shares of such series.

      o     The Company is authorized to issue 500,000 shares of Series III
            preferred stock, $1.00 par value per share, of which 265,000 shares
            are issued and outstanding at December 31, 2005.

            o     On September 23, 2004, the Company designated 165,000 shares
                  of the class of its Series III Preferred Stock, par value
                  $1.00, to an Investment Fund pursuant to a Promissory Note
                  with the Company dated August 5, 2004. This series has a
                  mandatory conversion provision. Mandatory Conversion. The
                  Corporation shall deliver to holders of Series A Preferred
                  Stock, within 105 days after the end of the fiscal year ending
                  on December 31, 2006, evidence of the Corporation's EBITDA (as
                  defined herein) for such fiscal year. In the event that such
                  EBITDA is less than $5,000,000, then the Corporation shall be
                  obligated to offer to redeem all outstanding shares of the
                  Series A Preferred Stock under and as set forth in this
                  Section, except that the first scheduled redemption date for
                  such redemption shall be deemed to be the day that is 120 days
                  after the end of such fiscal year and not the fifth
                  anniversary of the closing date. The term EBITDA for purposes
                  of this Section shall mean the sum of the Corporation's (a)
                  net income (or net loss) (b) interest expense, whether paid or
                  accrued, on all debt of the Corporation, (c) income tax
                  expense, (d) depreciation expense, (e) amortization expense,
                  and (f) extraordinary or unusual losses deducted in
                  calculating net income less extraordinary or unusual gains
                  added in calculating net income, in each case determined on a
                  consolidated basis for the Corporation and its Subsidiaries
                  for the fiscal year ending December 31, 2006.

                  o     At the option of the Investment Fund, each outstanding
                        share of Series III Preferred Stock is convertible into
                        one share of common stock

            o     On October 27, 2005, the Company designated 100,000 shares of
                  the class of its Series III Preferred Stock, par value $1.00,
                  to Jesse Dobrinsky and John L. Udell ("Investors and
                  Officers") as consideration for funds given to the Company.
                  The rights, preferences, and privileges of the Series III
                  Preferred Stock are relative to those of the Series IV
                  Preferred Stock, par value $1.00, designated to Triple Crown
                  Consulting, Inc. Such shares are based on an agreement entered
                  into between the Company and the Investors on October 26,
                  2005. At the option of the Investors, each outstanding share
                  of Series III Preferred Stock is convertible into common stock
                  based on the following conversion formula: the conversion
                  price per share shall be equal to the lesser of (i) the
                  average of the lowest of three trading day trading prices
                  during the five trading days immediately prior to the
                  conversion date multiplied by .70, or (ii) the average of the
                  lowest of the three day trading prices during the five trading
                  days immediately prior to the funding date.

                        o     At the option of the Investors and Officers, each
                              outstanding share of Series III Preferred Stock is
                              convertible into one share of common stock. In
                              addition, the holders of this Series III Preferred
                              Stock and the holders of our common stock along
                              with the holders of Series IV Preferred Stock
                              shall vote together as a single class on all
                              actions to be taken by our shareholders. At all
                              meetings of the shareholders and in the case of
                              any actions of shareholders in lieu of a meeting,
                              each holder of the Series III Preferred Stock
                              shall have thirty times that number of votes on
                              all matters submitted to the shareholders that is
                              equal to the number of shares of common stock
                              (rounded to the nearest whole number) into which
                              such holder's shares of Series III Preferred Stock
                              are then convertible, at the record date for the
                              determination of the shareholders entitled to vote
                              on such matters or, if no such record date is
                              established, at the date such vote is taken or any
                              written consent of such shareholders is effected.
                              This provision for determination of the number of
                              votes to which each holder of the Series III
                              Preferred Stock is entitled shall also apply in
                              cases in which the holders of the Series III
                              Preferred Stock have the right to vote together as
                              a separate class.


                                       13
<PAGE>

o     Series IV: The Company amended its articles of incorporation in September,
      2003 and January, 2006 and increased to 600,000 shares its Series IV
      convertible Preferred Stock ("Series IV"), $1.00 par value. Each share of
      the Series IV preferred stock is convertible into one share of the
      Company's common stock. Each holder of the Series IV preferred stock has
      twenty times that number of votes on all matters submitted to shareholders
      that is equal to the number of shares of common stock into which such
      holder's shares of Series IV preferred stock are then convertible. In
      addition, the holders of the Series IV preferred stock are entitled to
      receive noncumulative cash dividends at an annual dividend rate as
      determined by the Board of Directors. The Series IV preferred stock has a
      liquidation price of $1.00 per share in the event of any liquidation,
      dissolution or winding up of the Company, whether voluntary or
      involuntary. The Company's articles of incorporation state that the Series
      IV preferred stock will be convertible into the Company's common stock at
      a conversion price equal to the lesser of (1) the average of the lowest of
      three-day trading prices during the five trading days immediately prior to
      the Conversion Date multiplied by .70, or (2) the average of the lowest of
      three-day trading prices during the five trading days immediately prior to
      the funding date(s).

      o     The Company is authorized to issue 600,000 shares of class IV
            preferred stock, $1.00 par value per share, of which 552,500 shares
            are issued and outstanding at December 31, 2005.

Warrants

In connection with the convertible debt issued on December 29, 2005, the Company
has 2,000,000 warrants outstanding as of December 31, 2005, which are
exercisable at an exercise price of $0.001 and expire on December 28, 2008.

Options

In August 1999, the Company's stockholders approved the adoption of an Incentive
Stock Option Plan ("1999 Option Plan"), which allows the Board of Directors to
grant options to employees and members of the Board of Directors. The 1999
Option Plan provided the Board of Directors the right to grant options to
purchase up to a total of 100,000 shares of the Company's common stock. On
August 17, 2000, with the approval of the shareholders of the Company, the
number of shares available under the 1999 Option Plan was increased to
1,000,000. As of December 31, 2005, 220,000 options were outstanding under the
1999 Option Plan. During the year ended December 31, 2005, the Company issued
100,000 shares of its common stock under non-plan options in lieu of granting
options. As of December 31, 2005, 500,000 non-plan options were outstanding.

Transfer Agent

      Cargo Connection Logistics Holding, Inc.'s transfer agent is:

                  Florida Atlantic Stock Transfer
                  7130 Nob Hill Road
                  Tamarac, FL 33321
                  Telephone (954) 726-4954

Item 6. - MANAGEMENT DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS

GENERAL

As of May 12, 2005, Cargo Connection Logistics Holding, Inc. (f/k/a Championlyte
Holdings, Inc.) began operating in the transportation and logistics industry as
a third party logistics provider of transportation and management services,
through its subsidiaries, Cargo Connection Logistics Corp. and Mid-Coast
Management, Inc., to its target client base, ranging from mid-sized to Fortune
100(TM) companies. This is accomplished through its network of terminals and
transportation services.

Cargo Connection Logistics Corp. and Mid-Coast Management, Inc. perform
truckload and less-than-truckload (LTL) transportation utilizing company
equipment, dedicated owner operators and approved contract carriers. A core
competency is specializing in time-definite transportation and offers to its
customers, expedited, dedicated and exclusive use vehicles. Exclusive use
services require pinpoint and time sensitive coordination for those customers.
Revenues for these services account for approximately 20% of the total
transportation.


                                       14
<PAGE>

In addition, the companies operate U.S. Customs Bonded warehouse facilities and
container freight station operations. The services provided are specifically
designed to enhance and to support the customer's supply chain logistics needs
through operational excellence and value-added services. This is accomplished
through innovative solutions taking into account the specific diversified
markets of our customers.

Both companies are dedicated to providing our customers with premium services
that can be customized to meet their individual needs and are also flexible
enough to cope with an ever-changing business environment.

Although our gross revenues were down as well as an increase in our net loss for
the twelve months ended December 31, 2005, management believes that the upcoming
year will be much better based upon its business plan for 2006. The upcoming
year will see the Company expand its business through joint ventures which will
enable the Company to globalize its services offerd to our customers. The
Company will look to expand its local operations in New York, Florida and
Illinois.

The Company's transportation revenue was on track with last year's revenue that
was derived from its trucking operations. Its customer base has increased over
the past year as it has replaced its reliance on a major customer (ACI) and
replaced it with a broader customer base, as that part of our operation
continues to expand. Warehouse services, however, needs to generate additional
sales and cultivate new customers for its services. The Company's reliance on a
major customer for this service is a major factor in the downturn in revenue in
2005. We do not anticipate that the first quarter of 2006 will produce any major
difference in the results for this part of our operation. The Company is
optimistic that beginning with the third quarter results, the need for warehouse
services will begin to turn itself around and show promise to becoming a
profitable segment once again.

RESULTS OF OPERATIONS

Revenues from operations for the year ended December 31, 2005, were $14,661,851
compared with $18,343,972 for the year ended December 31, 2004. The approximate
$4,000,000 decrease in revenue was specifically due to the change in our
Container Freight Station operations run through the Mid-Coast Management
subsidiary. Due to our customer's change in business models, the services
offered by the Company were brought in house by the customer, resulting in a
reduction in revenue.

Revenues from operations for the year ended December 31, 2004, were $18,343,972
compared with $12,355,106 for the year ended December 31, 2003. The increase in
total revenues was approximately $800,000, which was due to increased
transportation revenue over the course of the year. In 2003, due to our agency
arrangement, we recognized revenues on a net basis. That being the agency sales
less the associated costs for those revenues. In 2003, the agency revenue was
approximately $5,700,000 with associated costs of $4,879,500 for the same
period.

Revenues generated from operations from our transportation services for the year
ended December 31, 2005 were $13,372,129 compared with $13,031,875 for the year
ended December 31, 2004. This represents a 2.6% increase in gross revenue over
the same time period. While revenue was relatively flat, the $340,000 increase
in total transportation revenue was due to (a) an increase in core service
offering and client acceptance of those offerings, (b) expansion of the
Atlanta-Miami (southern route) lanes to include Charlotte, Raleigh-Durham and
Greensboro service areas, and (c) various expansion into related business lines
and contract based freight relationships. The Company looked to replace the
business of a key customer, ACI, who filed for bankruptcy in December, 2004. It
has managed to replace that business along with that of another major customer
in 2004 with other business customers in 2005.

Conversely, revenues generated from our warehouse services operations for the
year ended December 31, 2005, were $1,289,722 compared with $5,471,679 for the
year ended December 31, 2004, for the Container Freight Operations and its
associated activities. This reflects a decrease in gross revenue of $4,181,957
over the same time period for the previous year. The reason for the decrease is
due to a change in the business relationship with a major customer. Under its
prior relationship, our Mid-Coast subsidiary in specific, was restricted in
obtaining new customers in certain markets whereas a result of this change
caused a loss of revenues. Mid-Coast presently is approved to look for new
customers in those markets. Due to seasonality, Mid-Coast expects to regain a
portion of the lost revenues.

The gross profit for year ended December 31, 2005 was $4,146,042 versus
$6,681,942 for the same time period ending December 31, 2004. The major reason
for the decrease in gross profit is due to the major decrease in the revenue
stream from the warehouse services operations.


                                       15
<PAGE>

Selling, general and administrative expenses increased to $7,849,716 for the
year ended December 31, 2005, from $7,602,536 for the year ended December 31,
2004. The $247,180 increase in selling, general and administrative expenses is
primarily the result of increased consulting and professional fees for the
Company of approximately $800,000 offset by a decrease in SG&A expenses in the
operating subsidiaries of approximately $540,000 mostly due to reductions in our
warehouse services operations along with an increase in transportation sales
personnel.

Selling, general and administrative expenses increased to $7,602,536 for the
year ended December 31, 2004, from $6,314,738 for the year ended December 31,
2003. The increase of $1,287,798 in 2004 over 2003 with regard to selling,
general and administrative expenses was due to the company assuming the costs
related operating fully under its own authority along with the overhead costs,
insurances and personnel to handle the operation directly.

The net result of these efforts was an increase in loss from operations before
other income (expense) of $3,703,674 for the year ended December 31, 2005,
compared to a loss from operations of $920,594 for the year ended December 31,
2004.

And for the years ended 2004 versus 2003, there was an increase in loss from
operations before other income (expense) of approximately $703,634 from the
prior year. This relates to a loss from operations of $920,594 in 2004 compared
to a loss from operations of $216,960 for the year ended December 31, 2003.

Interest and financing expense amounted to $1,364,939 for the year ended
December 31, 2005 versus $213,009 for the year ended December 31, 2004. This
$1,151,930 increase is primarily due to the associated interest and financing
costs for note conversions and an increase due to the debt payback of funds
advanced through Cargo Connection's factor for a customer which was determined
to be uncollectible by the factor upon the customer's bankruptcy filing in
December of 2004.

Interest and financing expenses amount to $213,009 For the year ended December
31, 2004 versus $109,185 for the year ended in 2003. The major difference is due
to the fees associated with our factor. The factor arrangement began in
September of 2003, wherein we used the factor's services for the entire year in
2004.

The above effect produced a net loss for year ended December 31, 2005, of
$4,527,363 compared to a net loss of $852,362 for the year ended December 31,
2004. The increase in the net loss of $3,675,001 is primarily due to an increase
in administrative costs of $262,146 along with an increase of approximately
$1,364,939 in financing expenses (see above), a decrease in direct operating
revenue of approximately $3,682,000 which is due to the decrease in revenue that
was not being generated by the Mid-Coast operation due to the change in
business.

We had a net loss of $852,360 for year ended December 31, 2004, compared with a
net profit of $100,314 for the year ended December 31, 2003. The major reason
for the difference in 2004 versus 2003 was a direct result of the bankruptcy
filing on one of our customers, ACI, Inc. wherein which we booked a bad debt
reserve. The amount due to the Company by ACI upon their bankruptcy filing was
over $786,000 of which the Company posted $450,000 as a Bad Debt Reserve against
the amount due in 2004.

LIQUIDITY AND CAPITAL RESOURCES (GOING CONCERN)

The Company incurred a net loss of $4,527,363 for the year ended December 31,
2005, a working capital deficiency of $5,470,916 and an accumulated deficit of
$8,234,027 at December 31, 2005. The Company has devoted substantially all of
its efforts to increasing revenues, achieving profitability, and obtaining
long-term financing and raising equity.

The Company's consolidated financial statements have been prepared on the
assumption that the Company will continue as a going concern. Management is
seeking various types of additional funding such as issuance of additional
common or preferred stock, additional lines of credit, or issuance of
subordinated debentures or other forms of debt will be pursued. The funding
should alleviate the Company's working capital deficiency and increase
profitability. However, it is not possible to predict the success of
management's efforts to achieve profitability. Also, there can be no assurance
that additional funding will be available when needed or, if available, that its
terms will be favorable or acceptable.

If the additional financing or arrangements cannot be obtained, the Company
would be materially and adversely affected and there would be substantial doubt
about the Company's ability to continue as a going concern. The consolidated
financial statements do not include any adjustments relating to the
recoverability and realization of assets and classifications of liabilities
necessary if the Company becomes unable to continue as a going concern.

Our available cash at December 31, 2005 was $247,018. In addition there is an
additional $152,864 in escrowed funds being held by Cargo Connection's factor
used to assist in the payment of transportation costs.


                                       16
<PAGE>

Convertible promissory notes at December 31, 2005, are those noted as Series A -
6.5% notes. As of December 31, 2005, these Series A - 6.5% notes have a
principal balance due of approximately $514,502. These notes have been utilized
to fund the Company and certain of its subsidiaries. The Company has another
convertible promissory note. It is due to a former officer of Championlyte,
David Goldberg ("Goldberg") in the amount of $86,790. Goldberg's note is for
three (3) years at an 8% interest rate.

There is also a short-term Convertible Secured Debenture due to current officers
of Cargo Connection in the amount of $75,000 at a 15% interest rate and is due
September 30, 2006

On December 29, 2005, the Company completed a financing agreement, which when
completed would result in a Convertible Secured Debenture in the amount of
$2,350,000 with Montgomery Equity Partners, Ltd. Pursuant to the agreement, the
Company issued two secured convertible debentures, one of which was issued on
December 29, 2005. Under the terms of the agreement, at Closing, the Company
received the initial traunch of the funding in the amount of $1,750,000. The
proceeds will be used to repay a convertible debenture in the amount of
$1,000,000 and associated closing costs and fees. The balance of $600,000, less
its associated closing costs, was received in February 2006 prior to filing of a
registration statement with the Securities and Exchange Commission. The Company
issued to Montgomery Equity Partners, Ltd., a secured convertible debenture in
the amount of $1,750,000 with a 10% interest rate and a maturity date of
December 28, 2007. In February, 2006, the Company received the second trauch and
issued to Montgomery Equity Partners, Ltd. a secured convertible debenture in
the amount of $600,000 with a 10% interest rate and a maturity date of February
12, 2008. The debentures are secured by Company assets pursuant to a Security
Agreement, dated December 30, 2005.

On October 27, 2005, the Company designated 100,000 shares of a class of its
Series III Preferred Stock, par value $1.00, to Jesse Dobrinsky and John L.
Udell ("Investors") collectively as consideration for funds in the amount of
$100,000 given to the Company.

FUTURE OUTLOOK

Over the course of this past year the Company has gone through a variety of
changes. One was its focus on business revenue streams and specific industries.
It began 2005 focused on the Beverage Industry and its primary focus is now on
Transportation and Logistics. The Company has undergone a change in Management
with the previous Officers and Directors having resigned on May 12, 2005 and
currently there are new Officers and Directors. Another change over this past
year was our Corporate name change. It went from being known as Championlyte
Holdings, Inc., to its current name, Cargo Connection Logistics Holding, Inc.

The Company's core focus is the Transportation and Logistics Industry and those
ancillary businesses and needs that it complements. The first entry into this
industry was though the acquisition on Cargo Connection Logistics Corp. and
Mid-Coast Management, Inc. These companies give the Company a solid base in
becoming a partner of the logistics community. Cargo Connection is capable of
being the Domestic transportation partner for those International companies who
require assistance throughout the United States. In addition, the transportation
network that is currently in place allows for the movement of goods throughout
the United States, Canada and Mexico on behalf of its customers. Cargo
Connection and Mid-Coast have the facilities to assist companies with their
freight by either holding the freight in their bonded facilities or possibly
sorting freight for the client while the goods are clearing customs in its
Customs approved Container Freight Stations.

The Company will be looking at other areas to become involved in that complement
the needs of the industry, either by adding additional services, helping to form
entities that have specific attributes or through acquisitions. One of these
entities that we are partnering in is Independent Transportation Group (ITG).
ITG has the ability to attract independent contractors and other carriers to
perform work on behalf of Cargo Connection Logistics and Mid-Coast. The primary
goal of the new division is to assist the Company in increasing the size and
scope of its driver fleet, while offering agents comprehensive packages for
medical insurance, profit sharing plans, as well as other benefits.

Another entity we are working together with to promote business opportunities is
American River International, Ltd. American River is able to provide Cargo
Connection with the required licenses and certifications to do business outside
the U.S. to new customers we are pursuing in the China/Pacific Rim.

We have restructured some of our outstanding debt and we look to retire some of
the existing debt still currently outstanding and look to get better terms on
these instruments. These additional enhancements will require additional
financing for us.


                                       17
<PAGE>

CRITICAL ACCOUNTING POLICIES

We have identified the policies outlined below as critical to our business
operations and an understanding of our results of operations. The list is not
intended to be a comprehensive list of all of our accounting policies. In many
cases, the accounting treatment of a particular transaction is specifically
dictated by accounting principles generally accepted in the United States, with
no need for management's judgment in their application. The impact and any
associated risks related to these policies on our business operations is
discussed throughout Management's Discussion and Analysis or Plan of Operations
where such policies affect our reported and expected financial results. For a
detailed discussion on the application of these and other accounting policies,
see the Notes to the Financial Statements. Note that our preparation of the
financial statements requires us to make estimates and assumptions that affect
the reported amount of assets, liabilities, revenues and expenses, and related
disclosure of contingent assets and liabilities. Certain estimates and
assumptions required to be made relate to matters that are inherently uncertain
as they pertain to future events. While management believes that the estimates
and assumptions used were the most appropriate, actual results could differ
significantly from those estimates under different assumptions and conditions.

The following is a description of those accounting policies believed by
management to require subjective and complex judgments which could potentially
affect reported results.

Revenue Recognition and Accounts Receivable

The Company recognizes all revenues based upon delivery of the goods at their
final destination for transportation. The warehouse services operations
recognize revenue upon the completion of services. Costs related to such revenue
are included in direct operating expenses.

Accounts receivable are recorded at the outstanding amounts net of the allowance
for doubtful accounts. Estimates are used in determining our allowance for
doubtful accounts based on the inability of our customers to make required
payments, historical collections experience, current economic trends and a
percentage of our accounts receivable by aging category. We review available
customer account and financial information, including public filings and credit
reports, current trends, credit policy, and accounts receivable aging and may
also consult legal counsel when appropriate. We also look at the credit quality
of our customer base as well as changes in our credit policies. We continuously
monitor collections and payments from our customers. When it is deemed probable
that an account of a specific customer will become uncollectible, that account
balance will be included in the reserve calculation. While credit losses have
historically been within expectations and the provisions established, we cannot
guarantee that we will continue to experience the same credit loss rates that we
have in the past. Our net income is directly affected by management's estimate
of the collectibility of accounts receivable.

Long-Lived Assets

On a periodic basis, management assesses whether there are any indicators that
the value of its long-lived assets may be impaired. An asset's value is
considered impaired only if management's estimate of current and projected
operating cash flows (undiscounted and without interest charges) of the asset
over its remaining useful life is less than the net carrying value of the asset.

Such cash flow projections consider factors such as expected future operating
income, trends and prospects, as well as the effects of demand, competition and
other factors. To the extent impairment has occurred, the carrying amount of the
asset would be written down to an amount to reflect the fair value of the asset.

We are required to make subjective assessments as to whether there are
impairments in the value of our long-lived assets and other investments. Our net
income is directly affected by management's estimate of impairments.

Deferred Income Taxes

Determining the consolidated provision for income tax expense, income tax
liabilities and deferred tax assets and liabilities involves judgment. We record
a valuation allowance to reduce our deferred tax assets to the amount of future
tax benefit that is more likely than not to be realized. We have considered
future taxable income and prudent and feasible tax planning strategies in
determining the need for a valuation allowance. A valuation allowance is
maintained by the Company due to the impact of the current year's net operating
loss (NOL). In the event that we determine that we would not be able to realize
all or part of our net deferred tax assets, an adjustment to the deferred tax
assets would be charged to net income in the period such determination is made.


                                       18
<PAGE>

Likewise, if we later determine that it is more likely than not that the net
deferred tax assets would be realized, and then the previously provided
valuation allowance would be reversed. Our current valuation allowance relates
predominately to benefits derived from the utilization of our NOL's.

The Company has allocated the proceeds received from convertible debt
instruments between the underlying debt instruments and the warrants, and has
recorded the conversion feature as a liability in accordance with SFAS No. 133,
"Accounting for Derivative Instruments and Hedging Activities" ("SFAS 133") and
related interpretations. The conversion feature and certain other features that
are considered embedded derivative instruments, such as a variable interest rate
feature, a conversion reset provision and redemption option, have been recorded
at their fair value within the terms of SFAS No. 133 as its fair value can be
separated from the convertible note and its conversion is independent of the
underlying note value. The conversion liability is marked to market each
reporting period with the resulting gains or losses shown on the Statement of
Operations. The Company has also recorded the resulting discount on debt related
to the warrants and conversion feature and is amortizing the discount using the
effective interest rate method over the life of the debt instruments.


                                       19
<PAGE>

Derivatives Instruments

In connection with the sale of debt or equity instruments, the Company may sell
options or warrants to purchase our common stock. In certain circumstances,
these options or warrants may be classified as derivative liabilities, rather
than as equity. Additionally, the debt or equity instruments may contain
embedded derivative instruments, such as variable conversion options, which in
certain circumstances may be required to be bifurcated from the host instrument
and accounted for separately as a derivative instrument liability.

The identification of, and accounting for, derivative instruments is complex.
Derivative instrument liabilities are re-valued at the end of each reporting
period, with changes in fair value of the derivative liability recorded as
charges or credits to income in the period in which the changes occur. For
options, warrants and bifurcated conversion options that are accounted for as
derivative instrument liabilities, we determine the fair value of these
instruments using the Black-Sholes option pricing model, binomial stock price
probability trees, or other valuation techniques, sometimes with the assistance
of a certified valuation expert. These models require assumptions related to the
remaining term of the instruments and risk-free rates of return, our current
common stock price and expected dividend yield, and the expected volatility of
our common stock price based on not only the history of our stock price but also
the experience of other entities considered comparable to us. The identification
of, and accounting for, derivative instruments and the assumptions used to value
them can significantly affect our financial statements.

Stock Based Transactions

We have concluded various transactions where we paid the consideration in shares
of our common stock. These transactions include:

      o     Acquiring the services of various professionals who provided us with
            a range of corporate consultancy services, strategic planning,
            development of business plans, investor presentations and advise and
            assistance with investments funding;
      o     Settlement of our indebtedness; and
      o     Providing incentives to attract retain and motivate employees who
            are important to our success.

When our stock is used in transactions, the transactions are generally valued
using the price of the shares being transferred at the time the shares are
issued for the services provided. If the value of the asset or services being
acquired is available and believed to fairly represent its market value, the
transaction is valued using the value of the asset or service being provided.


                                       20
<PAGE>

Item 7. - FINANCIAL STATEMENTS

Set forth below is a list of our financial statements for December 31, 2005,
included in this Annual Report on Form 10-K following Item 14.

================================================================================
                                                                          PAGE

Report of Independent Registered Public Accounting Firm....................F-1
Consolidated Balance Sheet as of December 31, 2005.........................F-2
Consolidated Statements of Operations for the Years Ended
  December 31, 2005 and 2004................... ...........................F-3
Consolidated Statements of Stockholders' Deficit for the Years
  Ended December 31, 2005 and 2004........ ................................F-4
Consolidated Statements of Cash Flows for the Years Ended
  December 31, 2005 and 2004...............................................F-5
Notes to Consolidated Financial Statements.................................F-6


<PAGE>

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Stockholders of
Cargo Connection Logistics Holding, Inc.
Inwood, New York

We have audited the accompanying consolidated balance sheet of Cargo Connection
Logistics Holding, Inc. as of December 31, 2005 and the related consolidated
statements of operations, and stockholders' deficit and cash flows for the years
ended December 31, 2005 and 2004. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. The Company is not required to
have, nor were we engaged to perform an audit of its internal control over
financial reporting. Our audit included consideration of internal control over
financial reporting as a basis for designing audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Company's internal control over financial
reporting. Accordingly, we express no such opinion. An audit also includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audit provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the consolidated financial position of Cargo
Connection Logistics Holding, Inc. as of December 31, 2005 and the consolidated
results of its operations and its cash flows for the years ended December 31,
2005 and 2004 in conformity with accounting principles generally accepted in the
United States of America.

The accompanying consolidated financial statements have been prepared assuming
the Company will continue as a going concern. As discussed in Note 4 to the
consolidated financial statements, the Company has reported losses from
operations, negative cash flows from operating activities, negative working
capital and has a stockholders' deficit. These conditions raise substantial
doubt about its ability to continue as a going concern. Management's plans in
regard to these matters are described in note 4. The consolidated financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.


Friedman LLP
East Hanover, New Jersey
May 18, 2006


                                      F-1
<PAGE>

                    CARGO CONNECTION LOGISTICS HOLDING, INC.
                           CONSOLIDATED BALANCE SHEET
                                DECEMBER 31, 2005


                                     ASSETS
Current Assets
  Cash                                                    $   247,018
  Cash in Escrow-factor                                       152,864
  Cash in Escrow-attorney                                      49,351
  Accounts receivable, net of doubtful accounts
    of 426,968                                                709,057
  Due from factor                                             611,684
  Prepaid expenses                                            216,144
                                                          -----------
Total current assets                                        1,986,118
                                                          -----------

Property and equipment, net [see Note 3(c)]                   412,033
Due from related parties                                       66,808
Security deposits                                              75,534
                                                          -----------
Total Assets                                              $ 2,540,493
                                                          ===========

                    LIABILITIES AND STOCKHOLDERS' DEFICIENCY

Current Liabilities
  Accounts payable and accrued expenses                   $ 3,426,786
  Financial instruments                                     2,152,754
  Current portion of convertible notes payable                514,502
  Current portion of notes payable                            351,495
  Current portion of capital leases payable                    63,239
  Current portion of secured debenture                         18,699
  Due to related parties                                      803,524
  Due to officers                                              27,893
  Due to others                                                62,500
  Security deposits and escrowed funds                         35,642
                                                          -----------
Total current liabilities                                   7,457,034
                                                          -----------

Long term portion of capital leases payable                    19,156
Long term portion of notes payable                             51,913
Long term portion of convertible notes payable                 15,207
Long term portion of secured debenture                          2,246
Deferred rent                                                 875,567
                                                          -----------
    Total Liabilities                                       8,421,123
                                                          -----------

Commitments

Stockholders' Deficiency
  Series III convertible preferred stock,  par value
    $1.00 - authorized 500,000 shares, 265,000
    shares issued and outstanding (liquidated value
    of $265,000)                                              265,000
  Series IV convertible preferred stock,  par value
    $1.00 - authorized 600,000 shares, 552,500 shares
    issued and outstanding (liquidation value $552,500)       552,500
  Common stock, par value $.001 - authorized
    5,000,000,000 shares, 537,065,658 shares issued
    and outstanding                                           537,066
  Additional paid in capital                                1,008,831
  Deferred offering costs                                     (10,000)
  Accumulated deficit                                      (8,234,027)
                                                          -----------
    Total Stockholders' Deficiency                         (5,880,630)
                                                          -----------
Total Liabilities and Stockholders' Deficiency            $ 2,540,493
                                                          ===========


           See accompanying notes to consolidated financial statements

                                       F-2
<PAGE>

                    CARGO CONNECTION LOGISTICS HOLDING, INC.
                     CONSOLIDATED STATEMENTS OF OPERATIONS
                        FOR THE YEARS ENDED DECEMBER 31,

<TABLE>
<CAPTION>
                                                       2005                2004
                                                   -------------       -------------
<S>                                                <C>                 <C>
Operating revenue:
    Revenue                                        $  14,661,851       $  18,343,972
                                                   -------------       -------------
          Total revenue                               14,661,851          18,343,972
                                                   -------------       -------------

Operating expenses:
    Operating expenses                                10,515,809          11,662,030
    Selling                                              142,492             355,112
    General and administrative                         7,707,224           7,247,424
                                                   -------------       -------------
          Total operating expenses                    18,365,526          19,264,566
                                                   -------------       -------------

Loss from operations                                  (3,703,674)           (920,594)
                                                   -------------       -------------

Other income (expense)
    Interest income                                        4,575               1,694
    Interest expense                                  (1,364,939)           (213,009)
Licensing revenue                                         25,000                  --
    Management fee                                            --               7,695
    Rental income                                        157,000              74,002
    Commission income                                         --               2,714
Income from financial instruments                        932,137                  --
    Gain on sale of asset                                  3,933              25,300
 Loss on early extinguishment of debt                   (614,362)                 --
    Other income (expenses)                               32,968             169,836
                                                   -------------       -------------
          Total other income (expense)                  (823,688)             68,232
                                                   -------------       -------------

Net loss                                           $  (4,527,363)      $    (852,362)
                                                   =============       =============

Acretion of Series IV preferred stock                   (209,612)                 --
                                                   =============       =============

Net loss applicable to common stockholders         $  (4,736,975)           (852,362)
                                                   =============       =============

Net loss per share, basic and diluted              $      (0.016)      $      (0.004)
                                                   =============       =============

Weighted average number of common shares used
  in the net loss per share calculation              289,223,672         239,599,127
                                                   =============       =============
</TABLE>

          See accompanying notes to consolidated financial statements


                                       F-3
<PAGE>

            CARGO CONNECTION LOGISTICS HOLDING, INC. AND SUBSIDIARIES
               CONSOLIDATED STATEMENT OF STOCKHOLDERS' DEFICIENCY

<TABLE>
<CAPTION>
                                                                                 Series III                    Series IV
                                                                                 Convertible                  Convertible
                                                     Common Stock              Preferred Stock              Preferred Stock
                                              -------------------------   -------------------------   --------------------------
                                                 Shares       Amount        Shares        Amount         Shares         Amount
                                              -----------   -----------   -----------   -----------   -----------    -----------
<S>                                           <C>           <C>           <C>           <C>           <C>            <C>
Balance January 1, 2004
(retroactively stated) (A)                    292,284,467   $   292,284       165,000   $   165,000       125,000    $   125,000

Net loss                                               --            --            --            --            --             --
                                              ----------------------------------------------------------------------------------
Balance December 31, 2004
(retroactively stated)                        292,284,467       292,284       165,000       165,000       125,000        125,000

Conversion of convertible notes
payable to common stock                         1,529,431         1,529            --            --            --             --

Conversion of convertible notes
payable to common stock                         3,125,000         3,125            --            --            --             --

Issuance of shares for payment
of debt                                        23,134,183        23,134            --            --            --             --

Issuance of shares for payment
of services                                       100,000           100            --            --            --             --

Issuance of shares for payment
of debt                                         1,300,000         1,300            --            --            --             --

Issuance of shares for payment
of services                                     3,000,000         3,000            --            --            --             --

Sale of preferred stock for cash                       --            --            --            --        40,000         40,000

Conversion of preferred stock
to common stock                                67,000,000        67,000            --            --       (25,000)       (25,000)

Conversion of convertible notes
payable to common stock                        20,661,416        20,662            --            --            --             --

Sale of preferred stock for cash                       --            --            --            --       350,000        350,000

Conversion of preferred stock
to common stock                                50,000,000        50,000            --            --       (25,000)       (25,000)

Conversion of convertible notes
payable to common stock                         9,682,863         9,683            --            --            --             --

Issuance of shares for payment
of debt                                        11,164,491        11,165            --            --            --             --

Issuance of shares for payment
of services                                     5,072,896         5,073            --            --            --             --

Sale of preferred stock for cash                       --            --            --            --       100,000        100,000

Conversion of preferred stock to
common stock                                   25,000,000        25,000            --            --       (12,500)       (12,500)

Conversion of convertible notes
payable to common stock                         5,613,320         5,613            --            --            --             --

Conversion of convertible notes
payable to common stock                         3,681,908         3,682            --            --            --             --

Issuance of shares for payment
of services                                       934,401           934            --            --            --             --

Sale of preferred stock for cash                       --            --       100,000       100,000            --             --

Conversion of convertible notes
payable to common stock                         5,244,707         5,245            --            --            --             --

Issuance of shares for payment
of services                                     8,097,793         8,098            --            --            --             --

Issuance of shares for payment
of services                                       438,782           439            --            --            --             --

Gain on extinguishment of debt                         --            --            --            --            --             --

Net loss                                               --            --            --            --            --             --
                                              ----------------------------------------------------------------------------------
Balance December 31, 2005                     537,065,658       537,066       265,000   $   265,000       552,500    $   552,500
                                              ==================================================================================

<CAPTION>
                                          Additional      Deferred                       Total
                                           Paid-in        Offering     Accumulated    Stockholders'
                                           Capital         Costs         Deficit       Deficiency
                                         -----------    -----------    -----------    -----------
<S>                                      <C>            <C>            <C>            <C>
Balance January 1, 2004
(retroactively stated) (A)               $        --    $   (10,000)   $(2,755,119)   $(2,665,718)

Net loss                                          --             --       (852,362)      (852,362)
                                         --------------------------------------------------------
Balance December 31, 2004
(retroactively stated)                            --        (10,000)    (3,607,481)    (3,518,080)

Conversion of convertible notes
payable to common stock                       24,471             --             --         26,000

Conversion of convertible notes
payable to common stock                       46,875             --             --         50,000

Issuance of shares for payment
of debt                                      518,144             --             --        541,278

Issuance of shares for payment
of services                                    1,400             --             --          1,500

Issuance of shares for payment
of debt                                       24,700             --             --         26,000

Issuance of shares for payment
of services                                   27,000             --             --         30,000

Sale of preferred stock for cash                  --             --             --         40,000

Conversion of preferred stock
to common stock                              (42,000)            --             --             --

Conversion of convertible notes
payable to common stock                       72,940             --             --         93,602

Sale of preferred stock for cash                  --             --             --        350,000

Conversion of preferred stock
to common stock                              (25,000)            --             --             --

Conversion of convertible notes
payable to common stock                       43,992             --             --         53,675

Issuance of shares for payment
of debt                                      145,138             --             --        156,303

Issuance of shares for payment
of services                                   58,511             --             --         63,584

Sale of preferred stock for cash                  --             --             --        100,000

Conversion of preferred stock
to common stock                              (12,500)            --             --             --

Conversion of convertible notes
payable to common stock                       47,387             --             --         53,000

Conversion of convertible notes
payable to common stock                       22,276             --             --         25,958

Issuance of shares for payment
of services                                    6,957             --             --          7,891

Sale of preferred stock for cash                  --             --             --        100,000

Conversion of convertible notes
payable to common stock                       23,077             --             --         28,322

Issuance of shares for payment
of services                                   23,902             --             --         32,000

Issuance of shares for payment
of services                                    1,561             --             --          2,000

Net loss                                          --             --     (4,527,363)    (4,527,363)
                                         --------------------------------------------------------
Balance December 31, 2005                $ 1,008,831    $   (10,000)   $(8,234,027)   $(5,880,630)
                                         ========================================================
</TABLE>

                 See notes to consolidated financial statements.

(A)   239,599,127 shares of common stock issued by Championlyte Holdings, Inc.
      to Cargo Connection Logistics, Corp. in exchange for the Common stock of
      Cargo Connection Logistics Corp. (reverse merger) as if it had occurred on
      January 1, 2004.

                 See notes to consolidated financial statements.


                                       F-4
<PAGE>

                 CARGO CONNECTION LOGISTICS CORP. AND AFFILIATE
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                        FOR THE YEARS ENDED DECEMBER 31,

<TABLE>
<CAPTION>
                                                                        12/31/2005         12/31/2004
                                                                       ------------       ------------
<S>                                                                    <C>                <C>
Cash flows from operating activities:
  Net loss                                                             $ (4,527,363)      $   (852,362)
  Adjustments to reconcile net loss to net
    cash provided by (used in) operating activities:
  Income from financial instruments                                        (932,137)
  Loss on extinguishment of debt                                            614,362
  Amortization of note discounts                                            258,377
  Interest expense for embedded derivative instruments                      163,845
  Write off of deferred financing costs                                    (105,000)
  Issuance of shares for services                                           190,033
          Depreciation and amortization                                     246,031            263,939
          Allowance for doubtful accounts                                   270,983            525,000
          Deferred rent                                                     781,252             (8,882)
  Changes in operating assets and liabilities:
          Decrease in escrow held by factor                                 207,289             41,023
          Increase in escrow held by attorney                               (49,351)                --
          Decrease (increase) in accounts receivable                        113,416           (545,850)
          (Increase) decrease in due from factor                           (367,637)           208,637
          Decrease (increase) in prepaid expenses                            49,303           (127,533)
          Decrease (increase) in due from others                                 --             (4,651)
          Decrease in due from employees                                      7,240                 --
          Increase in accounts payable and accrued expenses                 732,583            486,795
          Payments for note payable - factor                               (428,534)           428,534
          Increase in security deposits and escrowed funds                      595             11,011
  Decrease in customer deposits                                                  --           (320,850)
          Decrease in income taxes payable                                       --             (5,400)
                                                                       ------------       ------------

Net cash provided by (used in) operating activities                      (2,774,713)            99,411
                                                                       ------------       ------------

Cash flows from investing activities
Payments received for security deposits                                      88,880             98,262
Purchases of property and equipment                                         (16,897)          (147,465)
Proceeds from sale of property and equipment                                 38,347                 --
                                                                       ------------       ------------

Net cash provided by (used in) investing activities                         110,330            (49,203)
                                                                       ------------       ------------

Cash flows from financing activities
Proceeds from sale of Series III Preferred Stock                            100,000                 --
Proceeds from sale of Series IV Preferred Stock                             490,000                 --
Repayments towards related parties                                         (111,180)            (7,700)
Advances from others                                                         62,500                 --
Amounts received from related parties                                       684,644            219,207
    Proceeds from notes payable                                              91,599             60,000
    Principal payments on notes payable                                    (257,006)          (373,604)
    Proceeds from secured debentures                                      2,825,000                 --
Repayment of secured debenture                                           (1,000,000)
    Principal payments on capital leases payable                            (69,786)           (85,198)
                                                                       ------------       ------------

Net cash provided by (used in) financing activities                       2,815,771           (187,295)
                                                                       ------------       ------------

Net increase (decrease) in cash                                             151,388           (137,087)

Cash, beginning of year                                                      95,630            232,717
                                                                       ------------       ------------

Cash, end of year                                                      $    247,018       $     95,630
                                                                       ============       ============

Supplemental disclosure of cash flow information
Interest expense                                                       $     61,928       $         --
                                                                       ============       ============
Income taxes                                                           $         --       $         --
                                                                       ============       ============

Supplemental schedule of non-cash activities:
Conversion of convertible notes payable to common stock                $    512,527       $         --
                                                                       ============       ============
Recapitalization of additional paid in capital in connection
  with reverse acquisition                                             $ 16,230,384       $         --
                                                                       ============       ============
Shares issued to subsidiary in connection with reverse acquistion      $    239,599       $         --
                                                                       ============       ============
Accrued interest assumed as part of convertible note                   $      2,721       $         --
                                                                       ============       ============
Issuance of shares for settlement of payables                          $    877,622       $         --
                                                                       ============       ============
Cancellation of shares issued to Cornell Capital                       $    790,000       $         --
                                                                       ============       ============
Conversion of preferred stock to common stock                          $    142,000       $         --
                                                                       ============       ============
Gain on debt disposal                                                  $          0       $         --
                                                                       ============       ============
</TABLE>

          The accompanying notes should be read in conjunction with the
                         combined financial statements.


                                       F-5
<PAGE>

            CARGO CONNECTION LOGISTICS HOLDING, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
             FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2005 AND 2004

NOTE 1 - ORGANIZATION, HISTORY AND NATURE OF BUSINESS

On May 12, 2005, Cargo Connection Logistics Holding, Inc. (f/k/a Championlyte
Holdings, Inc.) began operating in the transportation and logistics industry as
a third party logistics provider of transportation and management services,
primarily through its subsidiaries, Cargo Connection Logistics Corp. and
Mid-Coast Management, Inc., to its target client base, ranging from mid-sized to
Fortune 100(TM) companies. This is accomplished through its network of terminals
and transportation services. Effective May 23, 2005, the name Championlyte
Holdings, Inc. was changed to Cargo Connection Logistics Holding, Inc. (the
"Company") to better reflect the new nature and focus of the entity and its
operations. Cargo Connection Logistics Holding, Inc. and all of its subsidiaries
are collectively referred to as the "Company".

The Company is a provider of logistics solutions for global partners through its
network of branch locations and independent agents in North America. It operates
as predominately as a non-asset based transportation provider which provides
truckload and less-than-truckload (LTL) transportation services utilizing some
company equipment, dedicated owner operators and through our relationships with
transportation companies.

The Company also provides a wide range of value-added logistics services which
include U.S. Customs Bonded warehouse facilities and container freight station
operations which enhance and support our customer's supply chain logistics
needs. Some of the services provided are pick and pack services, special
projects that will include changing labels or tickets on items, inspection of
goods into the United States

Reverse Acquisition

On May 12, 2005 (the "Effective Date"), pursuant to a Stock Purchase Agreement
and Share Exchange (the "Agreement") between the Company, Cargo Connection
Logistics Corp. ("Cargo Connection"), a Delaware corporation, and Mid-Coast
Management, Inc. ("Mid-Coast"), an Illinois corporation, the Company purchased
all of the outstanding shares of Cargo Connection and Mid-Coast for a total of
70% of the then issued and outstanding shares of the Company's common stock. As
additional consideration, the Company will issue shares of a new series of
preferred stock, the amount to be determined, to Cargo Connection and Mid-Coast
which, when converted into shares of the Company's common stock expected to be
within twelve (12) months from the Effective Date, Cargo Connection and
Mid-Coast will own a total of eighty (80%) percent of the outstanding shares of
the Company at such time.

The acquisition of Cargo Connection and Mid-Coast has been treated as a
recapitalization and purchase by Cargo Connection and Mid-Coast as the
accounting acquirer (reverse acquisition) of the Company, as control rests with
the former Cargo Connection and Mid-Coast shareholders, although prior to the
acquisition, the Company had been the registrant. Therefore, the historical
financial statements prior to May 12, 2005 are those of Cargo Connection and
Mid-Coast. The transaction is considered a capital transaction whereby the
Company contributed its stock for the net assets of Cargo Connection and
Mid-Coast.

Reverse merger accounting requires the Company to present in all financial
statements and other public information filings, prior historical and other
information of Cargo Connection and Mid-Coast, and a retroactive restatement of
cargo's historical shareholders' investment for the equivalent number of shares
of common stock received in the merger. Accordingly, the accompanying
consolidated financial statements present the results of operations for the year
ended December 31, 2005 and 2004 which are based upon historical financial
statements of Cargo Connection and Mid-Coast. Subsequent to May 12, 2005, the
operations reflect the combined operations of the former Company and Cargo
Connection and Mid-Coast.

NOTE 2 - BASIS OF PRESENTATION

Principals of consolidation

The consolidated financial statements include the accounts of the Company and
all subsidiaries. All significant intercompany accounts and transactions have
been eliminated in consolidation. Certain prior year amounts have been
reclassified to conform to the current year's presentation.


                                       F-6
<PAGE>

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

a) Cash, concentration of credit risk

Financial instruments, which potentially subject the Company to concentrations
of credit risk, consist of cash. The Company places its cash with high quality
financial institutions and at times may exceed the FDIC $100,000 insurance
limit. The Company has not experienced any losses on these accounts, and
believes that such risk in minimal.

The Company extends credit based on an evaluation of the customer's financial
condition, generally without collateral. Exposure to losses on receivables is
principally dependent on each customer's financial condition. The Company
monitors its exposure for credit losses and maintains allowances for anticipated
losses, as required.

b) Allowance for Doubtful Accounts

Management makes estimates as to the collectablility of accounts receivable.
Management specifically analyzes the aging of accounts receivable, client credit
reports, industry trends and economic indicators, as well as analysis of recent
payment history for specific customers.

c) Depreciation and amortization

Property and equipment is recorded at cost. Depreciation and amortization of
property and equipment is provided for by the straight-line method over the
estimated useful lives of the respective assets. The estimated useful lives of
the office equipment, trucks, machinery and equipment, and furniture and
fixtures are five years. Computer equipment and software is depreciated over
three years and leasehold improvements are amortized over the shorter of the
life of the improvement or the length of the lease.

The Company recognizes rent expense based upon the straight-line method which
adjusts for rent abatements and future rent increases. In connection with future
minimum lease payments at December 31, 2005, the amount deferred was $875,567.

The Company amortizes deferred financing costs over the respective terms of
their agreements using the straight-line method.

NEW NOTE: PROPERTY, PLANT AND EQUIPMENT

The components of property, plant and equipment were as follows:

                                                            December 31,
                                                    ----------------------------
                                                        2005            2004
                                                    ------------    ------------
Automobiles & trucks                                $    234,192    $    234,192
Machinery equipment                                      328,265         394,003
Furniture & fixtures                                     332,347         326,867
Computer equipment                                       627,385         625,324
Leasehold improvements                                   140,098         130,740
                                                    ------------    ------------
                                                       1,662,287       1,711,126
Less accumulated depreciation
  and amortization                                     1,250,254       1,031,613
                                                    ------------    ------------
Property and equipment, net                         $    412,033    $    679,513
                                                    ============    ============

Depreciation expense for the years ended December 31, 2005 and 2004 was $246,031
and $263,940, respectively, of depreciation and amortization on assets under
capital leases have been included in depreciation expense.

d) Valuation of long-lived assets

The Company accounts for its long-lived assets in accordance with SFAS No. 144,
"Accounting for the Impairment or Disposal of Long-Lived Assets," ("SFAS 144")
which requires that long-lived assets be evaluated whenever events or changes in
circumstances indicate that the carrying amount may not be recoverable. If the
total of the undiscounted future cash flows is less than the carrying amount of
the asset or asset group, an impairment loss is recognized for the difference
between the estimated fair value and the carrying value of the asset or asset
group. During the year ended December 31, 2005, there were no impairment charges
relating to long-lived assets.

e) Revenue recognition

The Company recognizes all revenues based upon delivery of the goods at their
final destination for transportation. The warehouse services operations
recognize revenue upon the completion of services. Costs related to such revenue
are included in direct operating expenses

f) Income taxes

The Company accounts for income taxes in accordance with SFAS No. 109,
"Accounting for Income Taxes." Deferred taxes are provided on the liability
method whereby deferred tax assets are recognized for deductible temporary
differences, and deferred tax liabilities are recognized for taxable temporary
differences. Temporary differences are the differences between the financial
statement and tax bases of assets and liabilities., Deferred tax assets are
reduced by a valuation allowance when, in the opinion of management, it is more
likely than not that some portion or all of the deferred tax assets will be
realized. Deferred tax assets and liabilities are adjusted for the effects of
changes in tax laws and rates on the date of enactment. Current income taxes are
based on the respective periods' taxable income for federal, state and city
income tax reporting purposes.


                                       F-7
<PAGE>

g) Estimated liability for insurance claims

The Company maintains automobile, general, cargo, and workers' compensation
claim liability insurance coverage under both deductible and retrospective
rating policies. In the month claims are reported, the Company estimates and
establishes any potential liabilities, if they exist, for its share of ultimate
settlements using all available information, coupled with the Companies' history
of such claims. Claim estimates are adjusted when additional information becomes
available. The recorded expense depends upon actual loss experience and changes
in estimates of settlement amounts for open claims that have not been fully
resolved. However, final settlement of these claims could differ from the
amounts the Company has accrued at year-end.

h) Use of estimates

The preparation of consolidated financial statements in conformity with
accounting principles generally accepted in the United States of America
requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and the disclosure of contingent assets and
liabilities at the date of the financial statements and the reported amounts of
revenues and expenses during the reporting periods. Actual results could differ
from these estimates. The more significant accounting estimates inherent in the
preparation of the Company's consolidated financial statements include estimates
as to the depreciable lives of property and equipment, valuation of equity
related instruments and derivatives issued, valuation allowance for deferred
income tax assets and allowance for doubtful accounts.

i) Fair value disclosure

For certain of the Company's financial instruments, including cash, receivables,
accounts payable, and accrued expenses, the carrying amounts approximate their
fair values due to their short-term maturities. The carrying amounts of the
Company's long-term debt also approximate fair values based on current rates for
similar debt offered to the Company.

j)Loss per common share

The Company reports earnings (loss) per share in accordance with SFAS No. 128,
"Earnings per Share." Basic loss per common share is computed by dividing net
loss allocable to common stockholders by the weighted average number of common
shares outstanding for the period. Diluted net loss per share reflects the
dilution from the potential conversion or exercise into common stock of
securities such as warrants. In all financial statements presented, diluted net
loss per common share is the same as basic net loss per common share. For the
years ended December 31, 2005 and 2004 warrants to purchase 2,000,000 and -0-
shares of common stock, respectively, were excluded from the calculation of
fully diluted earnings per share since their inclusion would have been
anti-dilutive. No additional shares of common stock for the potential dilution
from the conversion or exercise of securities into common stock are included in
the denominator, since the result would be anti-dilutive.

k) Stock-based compensation

On January 1, 2002, the Company has adopted fair value accounting for grants of
common stock, options and warrants to employees and non-employees in accordance
with Statement of Financial Accounting Standards No. 123, "Accounting for
Stock-Based Compensation" (SFAS No. 123), as amended by FAS 148 and Emerging
Issues Task Force Issue 96-18, "Accounting for Equity Instruments That Are
Issued to Other Than Employees for Acquiring, or in Conjunction with Selling,
Goods or Services" (EITF 96-18). The compensation expense is recognized over the
vesting period. All options granted by the Company prior to 2005 vested
immediately and compensation expense was recognized in the period of grant
(refer to Notes 17 and 18).

l) Discount on debt

The Company has allocated the proceeds received from convertible debt
instruments between the underlying debt instruments and the warrants, and has
recorded the conversion feature as a liability in accordance with SFAS No. 133,
"Accounting for Derivative Instruments and Hedging Activities" ("SFAS 133") and
related interpretations. The conversion feature and certain other features that
are considered embedded derivative instruments, such as a variable interest rate
feature, a conversion reset provision and redemption option, have been recorded
at their fair value within the terms of SFAS No. 133 as its fair value can be
separated from the convertible note and its conversion is independent of the
underlying note value. The conversion liability is marked to market each
reporting period with the resulting gains or losses shown on the Statement of
Operations. The Company has also recorded the resulting discount on debt related
to the warrants and conversion feature and is amortizing the discount using the
effective interest rate method over the life of the debt instruments.


                                       F-8
<PAGE>

m) Financial instruments

The Company evaluates its convertible debt, options, warrants or other contracts
to determine if those contracts or embedded components of those contracts
qualify as derivatives to be separately accounted for under Statement of
Financial Accounting Standards 133 "Accounting for Derivative Instruments and
Hedging Activities" and related interpretations including EITF 00-19 "Accounting
for Derivative Financial Instruments Indexed to, and Potentially Settled in, a
Company's Own Stock". The result of this accounting treatment is that the fair
value of the embedded derivative is marked-to-market each balance sheet date and
recorded as a liability. In the event that the fair value is recorded as a
liability, the change in fair value is recorded in the consolidated statement of
operations as other income or expense. Upon conversion or exercise of a
derivative instrument, the instrument is marked to fair value at the conversion
date and then that fair value is reclassified to equity.

In circumstances where the embedded conversion option in a convertible
instrument is required to be bifurcated and there are also other embedded
derivative instruments in the convertible instrument that are required to be
bifurcated, the bifurcated derivative instruments are accounted for as a single,
compound derivative instrument.

The classification of derivative instruments, including whether such instruments
should be recorded as liabilities or as equity, is re-assessed at the end of
each reporting period. Equity instruments that are initially classified as
equity that become subject to reclassification under SFAS 133 are reclassified
to liability at the fair value of the instrument on the reclassification date.
Derivative instrument liabilities are classified in the balance sheet as current
or non-current based on whether or not net-cash settlement of the derivative
instrument is expected within 12 months of the balance sheet date.

NOTE 4 - GOING CONCERN

The accompanying consolidated financial statements have been prepared on a basis
which contemplates the realization of assets and the satisfaction of liabilities
and commitments in the normal course of business. The Company incurred a net
loss attributable to common stockholders of approximately $4,527,000 and
$852,000 for the years ended December 31, 2005 and 2004, respectively, and has a
working capital deficiency of approximately $5,471,000 at December 31, 2005 and
a stockholders' deficit of approximately $5,881,000 at December 31, 2005 and
expects that it will incur additional losses in the immediate future. To date
the Company has financed operations primarily through sales of its equity
securities and issuance of debt instruments to related and unrelated parties.
Its ability to continue as a going concern is dependent upon the ability of the
Company to generate profitable operations in the future, raise additional
capital through the issuance of debt and sale of its common or preferred stock
and/or to obtain the necessary financing to meet its obligations and repay its
liabilities arising from normal business operations when they come due. Although
management continues to pursue these plans, there is no assurance that the
Company will be successful in obtaining financing on terms acceptable to the
Company. The outcome of these matters cannot be predicted with any certainty at
this time.

These factors raise substantial doubt that the company will be able to continue
as a going concern. These consolidated financial statements do not include any
adjustments to the amounts and classification of assets and liabilities that may
be necessary should the Company be unable to continue as a going concern.

The audit report prepared by our independent registered public accounting firm
relating to our consolidated financial statements for the year ended December
31, 2005 includes an explanatory paragraph expressing the substantial doubt
about our ability to continue as a going concern.

NOTE 5 - RESTATEMENT OF PREVIOUSLY ISSUED CONSOLIDATED FINANCIAL STATEMENTS

The Company's management and its audit committee concluded, on April 18, 2006,
that we would restate previously issued consolidated financial statements for
the two years ended December 31, 2004 and 2003, the quarters ended March 31,
2004; June 30, 2004 and September 30, 2004, as well as the quarters ended March
31, 2005, June 30, 2005 and September 30, 2005 to correct for errors in the
accounting for Convertible Debenture Notes, Stand Alone Warrants and as a result
of certain registration rights granted to the investors of these notes,
potential Liquidated Damages, interest rate adjustments and conversion option
features that were not previously recorded.


                                       F-9
<PAGE>

More specifically, the convertible debt have been previously been accounted for
under EITF 98-5 and EITF 00-27 using the intrinsic value accounting model which
includes accounting for beneficial conversion features. It has been determined
that the secured convertible debentures have embedded derivatives requiring
bifurcation under EITF 00-19 which require these instruments to be accounted for
under SFAS 133 using the fair value accounting model.

As a result of the Company's determination certain convertible debt instruments
are not conventional convertible debt, and any associated warrants and any
beneficial conversion features that were previously recorded as additional paid
in capital and with a corresponding reduction to the notes payable would be
eliminated from the balance sheet and the amortization of any warrant and
beneficial conversion feature value would be eliminated from the results of
operations. The warrants and any other potential embedded derivatives in the
notes requiring bifurcation under ElTF 00-19 would be accounted for as
liabilities and valued by being marked to market at each balance sheet date
under SFAS 133 and the corresponding gain or loss in value would be recorded in
our statement of operation as additional financing costs.

The Company reviewed its initial accounting for its (1) Series A 6.5%
Convertible Promissory Notes originally issued to Advantage Fund and subsequent
notes issued and/or assigned to Advantage Capital, Alpha, Gamma, Latitude,
Cornell and Montgomery, (2) along with the Highgate Convertible Note, dated May
11, 2005. During the review, the Company identified that EITF 00-19 should be
applied to evaluate whether any embedded derivative instruments qualify as
equity instruments or as liabilities. As a result, certain embedded derivatives
were identified that met the conditions set forth under paragraph 12 of SFAS No.
133. These embedded derivative instruments have been evaluated using EITF 00-19
paragraphs 12 to 32 and determined that these instruments would not be
classified as components of stockholders equity. The instruments have been
deemed liabilities, and as such, will be subject to SFAS 133 and should be
recorded at fair value.

As a result of the restatement, warrants and options have also been reclassified
as derivative liabilities. The warrants and options had previously been measured
based on a relative fair method and are now measured at their full fair value
and will be marked to market on each balance sheet date.

Embedded derivatives contained in the convertible debenture are now bifurcated
from the host debt and measured at fair value and classified as derivative
liabilities. These embedded derivatives will also be marked to market on each
balance sheet date.

The resulting debt discount will be amortized over the period of the convertible
debt and the secured line of credit as interest and other expenses in our
accompanying consolidated statements of operations.

The effect on our accompanying consolidated balance sheet as of December 31,
2004, was an increase in liabilities by $976,213 and corresponding decrease in
stockholders' equity of $976,213. The effect on our consolidated statements of
operations for the year ended December 31, 2004 was an increase in our net loss
of $299,957.

Features within the debt noted above that have been evaluated and determined to
require such treatment include:

o The principal conversion options.

o The monthly payments conversion options.

o The interest rate adjustment provisions.

Management believes the scope and process of its internal review of previously
reported financial information was sufficient to identify issues of a material
nature that could affect our Consolidated Financial Statements and all dates and
periods presented herein have been restated to fairly present the results of our
operations.


                                      F-10
<PAGE>

The following is a summary of the impact of the adjustments on the Company's
previously reported consolidated balance sheet as of December 31, 2004.

<TABLE>
<CAPTION>

                                                             December 31, 2004
                                                      --------------------------------
                                                       (As reported)    (As restated)
                                                      ---------------   --------------
<S>                                                   <C>               <C>
TOTAL ASSETS                                          $        67,017   $       67,017
                                                      ===============   ==============
LIABILITIES AND STOCKHOLDERS' EQUITY

Total current liabilities                             $     1,098,555   $    1,098,555
Noncurrent liabilities:
Long term convertible notes payable                         1,250,672        1,055,802
Derivative financial instruments                                  ---          877,030
Long term asset retirement obligation                             ---              ---
Long term, other                                                  ---              ---
                                                      ---------------   --------------
Total liabilities                                           2,349,227        3,031,387
                                                      ---------------   --------------
Stockholders' Equity
Preferred stock                                               265,000          265,000
Common stock                                                   44,422           44,422
Deferred Costs                                              (863,369)                0
Additional paid-in capital                                 17,410,588       16,547,519
Accumulated deficit                                       (19,138,851)     (19,821,311)
                                                      ---------------   --------------
Total stockholders' equity                                 (2,282,210)     (2,964,370)
                                                      ---------------   --------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY            $        67,017   $       67,017
                                                      ===============   ==============
</TABLE>


                                      F-11
<PAGE>

NOTE 6 - RECENT ACCOUNTING PRONOUNCEMENTS

In December 2004, the FASB issued SFAS No. 153, "Exchanges of Nonmonetary
Assets", an amendment of APB Opinion No. 29. SFAS 153 eliminates the exception
from fair value measurement for nonmonetary exchanges of similar productive
assets in paragraph 21 (b) of APB Opinion No. 29, "Accounting for Nonmonetary
Transactions" ("APB 29"), and replaces it with an exception for exchanges that
do not have commercial substance. SFAS 153 specifies that a nonmonetary exchange
has commercial substance if the future cash flows of the entity are expected to
change significantly as a result of the exchange. SFAS 153 is effective for the
fiscal periods beginning after June 15, 2005 and the Company will adopt this
Statement in the first quarter of 2006. The Company currently does not
anticipate that the effects of the statement will materially affect its
consolidated financial position or consolidated results of operations upon
adoption.

In February 2006, the FASB issued SFAS 155 - "Accounting for Certain Hybrid
Financial Instruments--an amendment of FASB Statements No. 133 and 140." This
Statement amends FASB Statements No. 133, "Accounting for Derivative Instruments
and Hedging Activities", and No. 140, "Accounting for Transfers and Servicing of
Financial Assets and Extinguishments of Liabilities". This Statement resolves
issues addressed in Statement 133 Implementation Issue No. D1, "Application of
Statement 133 to Beneficial Interests in Securitized Financial Assets." This
Statement:

      a.    Permits fair value remeasurement for any hybrid financial instrument
            that contains an embedded derivative that otherwise would require
            bifurcation

      b.    Clarifies which interest-only strips and principal-only strips are
            not subject to the requirements of Statement 133

      c.    Establishes a requirement to evaluate interests in securitized
            financial assets to identify interests that are freestanding
            derivatives or that are hybrid financial instruments that contain an
            embedded derivative requiring bifurcation

      d.    Clarifies that concentrations of credit risk in the form of
            subordination are not embedded derivatives

      e.    Amends Statement 140 to eliminate the prohibition on a qualifying
            special-purpose entity from holding a derivative financial
            instrument that pertains to a beneficial interest other than another
            derivative financial instrument.

This Statement is effective for all financial instruments acquired or issued
after the beginning of our first fiscal year that begins after September 15,
2006. The fair value election provided for in paragraph 4(c) of this Statement
may also be applied upon adoption of this Statement for hybrid financial
instruments that had been bifurcated under paragraph 12 of Statement 133 prior
to the adoption of this Statement. Earlier adoption is permitted as of the
beginning of our fiscal year, provided we have not yet issued financial
statements, including financial statements for any interim period, for that
fiscal year. Provisions of this Statement may be applied to instruments that we
hold at the date of adoption on an instrument-by-instrument basis. The Company
is currently reviewing the effects of adoption of this statement but it is not
expected to have a material impact on our financial statements.

In March 2005, the FASB issued FIN No. 47, "Accounting for Conditional Asset
Retirement Obligations - an interpretation of FASB Statement No. 143 "Accounting
for Asset Retirement Obligations ("SFAS No. 143")" ("FIN 47"). FIN 47 clarifies
that the term conditional asset retirement obligation as used in SFAS No. 143,
refers to a legal obligation to perform an asset retirement activity in which
the timing and (or) method of settlement are conditional on a future event that
may or may not be within the control of the entity. Accordingly, an entity is
required to recognize a liability for the fair value of a conditional asset
retirement obligation if the fair value of the liability can be reasonably
estimated. The liability for the conditional asset retirement obligation should
be recognized when incurred. This Interpretation also clarifies when an entity
would have sufficient information to reasonably estimate the fair value of an
asset retirement obligation. FIN 47 is effective for fiscal periods beginning
after December 15, 2005, and we will adopt this provision, as applicable, during
fiscal year 2006.


                                      F-12
<PAGE>

In May 2005, the FASB issued Statement of Financial Accounting Standards
("SFAS") No. 154 ("SFAS No. 154"), "Accounting Changes and Error Corrections."
SFAS No. 154 requires restatement of prior periods' financial statements for
changes in accounting principle, unless it is impracticable to determine either
the period-specific effects or the cumulative effect of the change. Also, SFAS
No. 154 requires that retrospective application of a change in accounting
principle be limited to the direct effects of the change. SFAS No. 154 is
effective for accounting changes and corrections of errors made in fiscal years
beginning after December 15, 2005 however the Statement does not change the
transition provisions of any existing accounting pronouncements. The Company
will adopt the provision, as applicable, during fiscal year 2006.

On July 14, 2005, FASB issued its Exposure Draft, "Accounting for Uncertain Tax
Positions", which is a proposed interpretation to FASB Statement No. 109,
"Accounting for Income Taxes." This proposed interpretation would require an
enterprise to recognize, in its financial statements, the best estimate of the
impact of a tax position. In evaluating whether the probable recognition
threshold has been met, this proposed interpretation would require the
presumption that the tax position will be evaluated during an audit by taxing
authorities. The term probable is used in this proposed interpretation
consistent with its use in FASB Statement No. 5, "Accounting Contingencies", to
mean "the future event or events are likely to occur." Individual tax positions
that fail to meet the probable recognition threshold will generally result in
either (a) a reduction in the deferred tax asset or an increase in a deferred
tax liability or (b) an increase in a liability for income taxes payable or the
reduction of an income tax refund receivable. The impact may also include both
(a) and (b). The proposed interpretation would be effective as of the end of the
first fiscal year ending after December 15, 2005. The initial recognition of the
effect of applying the proposed interpretation would be a cumulative effect of a
change in accounting principle. The comment period for the proposed
interpretation ends on October 28, 2005. The Company is currently evaluating the
impact of the Exposure Draft on its financial statements.

NOTE 7 - FACTORING FACILITIES

Cargo Connection has an agreement with a factor which provides an accounts
receivable factoring facility by purchasing certain accounts receivable and
extending credit with a maximum borrowing amount of $2,000,000. The contract is
annual in nature, automatically renewing annually unless Cargo Connection
provides thirty (30) days cancellation notice. The agreement provides that the
factor will purchase up to 90% of eligible accounts receivable of Cargo
Connection minus a discount of approximately 1.55% and a discretionary reserve
(holdback) which is reduced with payments from the debtor. If an invoice is
outstanding over 90 days, Cargo Connection, under recourse provisions, must buy
back the invoice from the factor. Cargo Connection must submit a minimum of
$1,500,000 of eligible invoices in any calendar quarter. At December 31, 2005,
$611,684 is due from the factor which represents the reserve against submitted
invoices. The escrow being held by the factor totaling $152,864 represents funds
available to assist Cargo Connection in funding payments to carriers. At
December 31, 2005, the total amount advanced by the factor was $1,802,513 which
represents the financing of accounts receivables purchased.

         Promissory Note

         In addition, with the bankruptcy filing of one of Cargo Connection's
         customers, a Promissory Note was entered into for the repayment of the
         advances given to Cargo Connection for eligible invoices for that
         customer. This note was entered into on December 3, 2004 in the amount
         of $523,412. Cargo Connection, through its collection process, fully
         paid the obligation in 2005.

NOTE 8 - CONVERTIBLE NOTES PAYABLE

The Company is obligated under various Series A convertible promissory notes
payable to four entities totaling $514,502. The notes were due December 31, 2004
and are considered on demand. Substantially all of the notes have been fully
paid or converted as of May 1, 2006. The notes bear interest at 6.5% and are
convertible into shares of the Company's common stock with a conversion price
per share equal to the lesser of the average of the lowest of three day trading
prices during the five trading days immediately prior to the conversion date
multiplied by .80 or, the average of the lowest of three day trading prices
during the five trading dates immediately prior to the funding dates. Pursuant
to the terms of the notes, the Company entered into a Security Agreement with a
collateral agent, on behalf of the note holders granting the collateral agent a
security interest in substantially all of the Company's assets.


                                      F-13
<PAGE>

The Company was obligated under a $50,000 Series B 6.5% Convertible Promissory
Note. In May 2005, the holder elected to convert its promissory note into Series
IV preferred stock and is fully paid.

The notes are presently stated on a net to fair value basis.

In summary, the following are represented on the consolidated balance sheet.


Short-term Notes:
-----------------
                                    Fair Value
                                   -------------
Advantage Funds                    $    346,002
Advantage Capital                        43,500
Montgomery                              100,000
Gamma                                    25,000
                                   -------------
     Total Short-term:             $    514,502
                                   =============

Long-term convertible note

In April 2005, the Company entered into a Convertible Promissory Note to a
former Company officer that was advanced to the Company in the amount of
$86,790. The note has a 3-year term with interest payable only at a rate of 8%
per annum. The Company has an option on the three year anniversary of the
debenture to pay the debenture in full or convert into the Company's shares of
common stock. However, in no event shall the Holder be entitled to convert this
note so that the Holder, upon conversion would cause the aggregate number of
shares of Common Stock beneficially owned by the Holder and its affiliates to
exceed 4.99% of the outstanding shares of the Common Stock following such
conversion. The Holder is entitled to convert into shares of the Company's
common stock, at the price per share equal to the lesser of (a) an amount equal
to one hundred and fifty percent (150%) of the closing bid price of the Common
Stock or (b) an amount equal to fifty percent (50%) of the closing bid price of
the Company's Common Stock, as quoted by Bloomberg, LP, for the five (5) trading
days immediately preceding the Conversion Date.

In summary, the following are represented on the consolidated balance sheet.

Long-term Notes:
----------------
                                     Fair Value
                                   -------------
David Goldberg                          $86,790
    Discount on Note                    (71,583)
                                   -------------
      Total Long-term:             $     15,207
                                   =============

NOTE 9 - OBLIGATIONS UNDER CAPITAL LEASES

The Company leases machinery, equipment and software under various
non-cancelable capital leases with a capitalized cost of $714,431, less
accumulated amortization of $520,635 as of December 31, 2005. The obligations
require monthly payments, including interest totaling $4,151. Interest rates
range from 2% to 14% and the lease obligations mature through September 30,
2008. Various obligations are guaranteed by certain executive officers of the
Company.

As of December 31, 2005, the aggregate future minimum annual lease payments
under these leases are as follows:

      Years
Ending December 31,
-------------------
       2006                                                   $ 65,704
       2007                                                     16,887
       2008                                                      2,607
       2009                                                        -0-
                                                              --------
       Total                                                    85,198
       Less: amount representing interest                        2,803
                                                              --------
       Net present value of capital lease obligations           82,395
       Current portion                                          63,239
                                                              --------
       Long-term portion                                      $ 19,156
                                                              ========


                                      F-14
<PAGE>

NOTE 10 - NOTES PAYABLE

Two obligations with a vendor originally totaling $157,773 relating to the
purchase of trailers were fully paid in April 2005.

A loan agreement with U.S. Small Business Administration ("SBA") whereby the SBA
loaned $90,200 for working capital purposes. The loan bears interest at a rate
of 4% per annum. The loan matures in 2008, where the balance due approximates
$14,000. Monthly installments totaling $2,664 began in June 2005 as required and
is secured by the personal guarantees of the officers of Cargo Connection and is
collateralized by substantially all the assets of Cargo Connection. As of
December 31, 2005, the balance of the note is $81,167.

A note payable to Financial Federal Credit for $204,372 is secured by six
tractors. The note bears interest at rate of 8% per annum and is payable in
monthly installments of principal and interest totaling $7,489, matures in
February 2006 and is collateralized by the tractors. At December 31, 2005, the
balance due is $14,830. The note is secured by the personal guarantees of the
officers of Cargo Connection.

An obligation due to a vendor totaling $108,256 relating to services provided
was fully paid in February 2005.

The Company has a revolving loan with HSBC Bank whereby the Company was granted
a $100,000 line of credit. At December 31, 2005, the balance on the line of
credit was $100,000 and bears interest at a rate of prime plus 2-1/2% (9.75% at
December 31, 2005). the Company is required to make monthly interest only
payments until December 15, 2006, when the line of credit terminates. At that
time the remaining balance becomes a note payable with a four year term. The
obligation is collateralized by all of the assets of Mid-Coast and guaranteed by
all of this company's officers.

The Company entered into a promissary note with National Semi-Trailer for
repayment of trade payable obligations in the amount of $87,910. The note bears
interest at a rate of 10% per annum and is payable in weekly installments of
$2,041 and payable over 45 weeks.

At December 31, 2005, future minimum annual principal payments on the above
notes are as follows:

Twelve Months
Ending December 31,
--------------------
      2006                   $  351,495
      2007                       30,446
      2008                       21,467
      2009                          -0-
                             ----------
                             $  403,408
                             ==========

NOTE 11 - SECURED CONVERTIBLE DEBENTURES

On May 12, 2005, the Company completed a financing agreement for $1,000,000 with
Highgate House Funds, Ltd. (the "Investor"). Under the agreement the Company
issued a $1,000,000 secured convertible debenture with a 10% interest rate to
the Investor with a maturity date of November 3, 2006. The debenture was secured
by all of the assets of the Company. This note was paid off through a new
financing arrangement entered into by the Company on December 29, 2005 with
Montgomery Equity Partners, Ltd described below.


                                      F-15
<PAGE>

The Note is a hybrid instrument which contains both freestanding derivative
financial instruments and more than one embedded derivative feature which would
individually warrant separate accounting as a derivative instrument under SFAS
No. 133. The freestanding derivative financial instruments include the warrant,
which was valued individually, and totaled $898,268 at the date of inception.
The various embedded derivative features have been bundled together as a single,
compound embedded derivative instrument that has been bifurcated from the debt
host contract, referred to as the "Compound Embedded Derivative Liability". The
single compound embedded derivative features include the conversion feature
within the notes, the conversion reset feature, and the early redemption option.
The value of the single compound embedded derivative liability was bifurcated
from the debt host contract and recorded as a derivative liability, which
resulted in a reduction of the initial carrying amount (as unamortized discount)
of the notes. The unamortized discount is amortized to interest expense using
the effective interest method over the life of the note.

In order to comply with generally accepted accounting principles in the United
States, the Company`s consolidated financial statements had to reclassify the
Highgate warrants from additional paid in capital to liabilities and interest
expense effective May 12, 2005 to reflect that the registration rights agreement
into which the Company entered in connection with its issuance of the warrants
requires the Company to pay liquidated damages, which in some cases could exceed
a reasonable discount for delivering unregistered shares and thus would require
the warrants to be classified as a liability until the earlier of the date the
warrants are exercised or expire. In accordance with EITF 00-19, "Accounting for
Derivative Financial Instruments Indexed To, and Potentially Settled In, a
Company's Own Stock", the Company has allocated a portion of the offering
proceeds to the warrants based on their fair value. EITF 00-19 also requires
that the Company revalue the warrants as a derivative instrument periodically to
compute the value in connection with changes in the underlying stock price and
other assumptions, with the change in value recorded as other expense or other
income.

In conjunction with the Highgate Instrument, Highgate was paid a fee of $105,525
in May 2005, and received a three-year warrant to purchase up to 250,000 shares
of the Company's common stock at price of $0.001 per share. The warrant, which
is exercisable immediately, was valued at $7,424 using a Black-Scholes
option pricing model. The value of the warrant and the fees paid to Highgate
were recorded as a discount to the note and are being amortized over the term of
the loan using the effective interest method. Upon the repayment of the
debenture which occurred in December 2005, the warrant was cancelled.

In October 2005, the Company entered into a second secured convertible debenture
with members of the management in the amount of $75,000. Under the agreement the
Company issued a $75,000 secured convertible debenture with a 15% interest rate
to the group with a maturity date of September 30, 2006. The debenture is
convertible after into common shares of the Company at a conversion price equal
to the lesser of (a) $0.005 per share or (b) seventy five percent (75%) of the
lowest Closing Bid Price of the Common Stock of the five (5) trading days
immediately preceding the Conversion date.

This Note is a hybrid instrument which contains an embedded derivative feature
which would individually warrant separate accounting as a derivative instrument
under SFAS No. 133. The embedded derivative feature have has been bifurcated
from the debt host contract, referred to as the "Compound Embedded Derivative
Liability". The embedded derivative feature includes the conversion feature
within the note and an early redemption option. The value of the embedded
derivative liability was bifurcated from the debt host contract and recorded as
a derivative liability, which resulted in a reduction of the initial carrying
amount (as unamortized discount) of the notes. The unamortized discount is
amortized to interest expense using the effective interest method over the life
of the notes, or 12 months.

On December 29, 2005, the Company completed a financing agreement for $1,750,000
with Montgomery Equity Partners, Inc. (the "Investor"). Under the agreement the
Company issued a $1,750,000 secured convertible debenture with a 10% interest
rate to the Investor with a maturity date of December 28, 2007. The debenture is
convertible after into common shares of the Company at a conversion price equal
to the lesser of (a) $0.0025 per share or (b) seventy five percent (75%) of the
lowest Closing Bid Price of the Common Stock of the ten (10) trading days
immediately preceding the Conversion date. The Company simultaneously issued to
the Investor a three year Warrant to purchase 2,000,000 Shares of the Company's
common stock at an exercise price of $0.001. The Company is committed to filing
an SB-2 Registration Statement with the SEC no later than forty-five (45) days
from date of funding. The Company can be held in default if the SB-2
Registration Statement does not become effective within 150 days of filing the
statement. The obligation contains several affirmative and negative covenants.
There are penalty provisions for the Company should the filing not become
effective within 120 days of filing an SB-2 Registration Statement. The
debenture is secured by the assets of the Company. The registration statement
has been filed in February 2006. Some of the other provisions are (a) the
Company, at its option, can redeem a portion or all amounts outstanding under
this Debenture prior to the Maturity Date at a redemption premium twenty five
percent (25%) of the principal amount being redeemed, and accrued interest; (b)
the Holder has rights of first refusal on additional funding to the Company, so
long as any portion of this Debenture is outstanding if the Company intends to
raise additional capital by the issuance or sale of capital stock; (c) the
Holder, together with any affiliate thereof may not beneficially own in excess
of 4.9% of the then issued and outstanding shares of Common Stock.


                                      F-16
<PAGE>

The Note is a hybrid instrument which contains both freestanding derivative
financial instruments and more than one embedded derivative feature which would
individually warrant separate accounting as a derivative instrument under SFAS
No. 133. The freestanding derivative financial instruments include the warrant,
which was valued individually, and totaled $1,857,752 at the date of inception.
The various embedded derivative features have been bundled together as a single,
compound embedded derivative instrument that has been bifurcated from the debt
host contract, referred to as the "Compound Embedded Derivative Liability". The
single compound embedded derivative features include the conversion feature
within the notes, the conversion reset feature, the early redemption option and
the interest rate adjustments. The value of the single compound embedded
derivative liability was bifurcated from the debt host contract and recorded as
a derivative liability, which resulted in a reduction of the initial carrying
amount (as unamortized discount) of the notes. The unamortized discount is
amortized to interest expense using the effective interest method over the life
of the notes, or 24 months.

In order to properly reflect the consolidated financial statements so that they
comply with generally accepted accounting principles in the United States, the
Company has classified the Montgomery warrants as liabilities and associated
interest expenses effective December 29, 2005 to reflect that the registration
rights agreement into which the Company entered in connection with its issuance
of the warrants requires the Company to pay liquidated damages, which in some
cases could exceed a reasonable discount for delivering unregistered shares and
thus would require the warrants to be classified as a liability until the
earlier of the date the warrants are exercised or expire. In accordance with
EITF 00-19, "Accounting for Derivative Financial Instruments Indexed To, and
Potentially Settled In, a Company's Own Stock", the Company has allocated a
portion of the offering proceeds to the warrants based on their fair value. EITF
00-19 also requires that the Company revalue the warrants as a derivative
instrument periodically to compute the value in connection with changes in the
underlying stock price and other assumptions, with the change in value recorded
as other expense or other income.

In conjunction with the Montgomery Convertible Note, Montgomery was paid a fee
of $135,000 in December 2005, and received a three-year warrant to purchase up
to 2,000,000 shares of the Company's common stock at a price of $0.001 per
share. The warrant, which is exercisable immediately, was valued at $3,784 using
a Black-Scholes option pricing model. The value of the warrant and the fees paid
to Montgomery were recorded as a discount to the note and are being amortized
over the term of the loan using the effective interest method.

NOTE 13 - FINANCIAL INSTRUMENTS

Series A 6.5% Convertible Promissory Notes

These Notes are hybrid instruments which contain embedded derivative features
which would individually warrant separate accounting as a derivative instrument
under SFAS No. 133. The various embedded derivative features have been bundled
together as a single, compound embedded derivative instrument that has been
bifurcated from the debt host contract, referred to as the "Compound Embedded
Derivative Liability". The single compound embedded derivative features include
the conversion feature within the notes and the early redemption option. The
value of the single compound embedded derivative liability was bifurcated from
the debt host contract and recorded as a derivative liability, which resulted in
a reduction of the initial carrying amount (as unamortized discount) of the
notes. The unamortized discount is amortized to interest expense using the
effective interest method over the life of the notes.

In order to correct the consolidated financial statements so that they comply
with generally accepted accounting principles in the United States, the Company
has restated the consolidated financial statements as of December 31, 2004 to
reclassify the embedded derivatives in these Series A 6.5% Convertible
Promissory Notes from additional paid in capital to liabilities and interest
expense effective January 2003. The Holders of these Notes include Advantage
Capital, Advantage Fund, Montgomery, Gamma, Alpha, Latitude and Cornell.

Goldberg Convertible Promissory Note

This Note is a hybrid instrument which contains an embedded derivative feature
which would individually warrant separate accounting as a derivative instrument
under SFAS No. 133. The embedded derivative feature have has been bifurcated
from the debt host contract, referred to as the "Compound Embedded Derivative
Liability". The embedded derivative feature includes the conversion feature
within the note and an early redemption option. The value embedded derivative
liability was bifurcated from the debt host contract and recorded as a
derivative liability, which resulted in a reduction of the initial carrying
amount (as unamortized discount) of the notes. The unamortized discount is
amortized to interest expense using the effective interest method over the life
of the notes, or 36 months.


                                      F-17
<PAGE>

In order to correct the consolidated financial statements so that they comply
with generally accepted accounting principles in the United States, the Company
will restate the consolidated financial statements for each quarter of 2005 to
reclassify this Convertible Promissory Notes from additional paid in capital to
liabilities and interest expense effective April 2005.

NOTE 14 - EMPLOYEE BENEFIT PLAN

The company maintains a 401(k) savings plan that covers substantially all of its
employees. Participants in the savings plan may elect to contribute, on a pretax
basis, a certain percentage of their salary to the plan. Presently, the Company
does not match any portion of the participant's contributions as per the
provisions of the plan.

NOTE 15 - ACCRUED EXPENSES

Accrued expenses consist of the following:

Salaries                    $   208,509
Interest                        156,252
Other                            12,688
                             ----------
                             $  491,449
                             ==========

NOTE 16 - COMMITMENTS AND CONTINGENCIES

Lease Commitments

The Companies has entered into non-cancelable operating leases for offices and
warehouse space in several States including Illinois, New York, Ohio, Florida
and Georgia. Additionally, the Companies lease equipment and trucks under
non-cancelable operating leases. The leases are subject to escalation for the
Companies' proportionate share of increases in real estate taxes and certain
other operating expenses. The approximate future minimum rentals under
non-cancelable operating leases in effect on December 31, 2005, are as follows:


                         Office and                     Equipment
                        Warehouse Space                 and Trucks
                        -------------                  -------------
2006                    $   1,402,112                  $     112,293
2007                        1,645,445                        113,978
2008                        1,610,170                        115,688
2009                        1,500,066                        117,424
2010                        1,323,933                         89,055
Thereafter                  4,670,171                            -0-
                        -------------                  -------------
                        $  12,151,897                  $     548,438
                        =============                  =============

Rent expense (inclusive of amortization of straight line expense) charged to
operations for office and warehouse space for the twelve months ended December
31, 2005, and 2004 amounted to $1,698,881 and $1,269,741 respectively. See Note
18 for rent expense paid to related entities. Rent expense charged to operations
for trucks and equipment for the years ended December 31, 2005 and 2004 amounted
to $528,835 and $616,847, respectively.


                                      F-18
<PAGE>

Litigation

Various vendors and consultants have filed actions against the Company. The
Company has included $37,500 in accounts payable and accrued expenses at
December 31, 2005, as a contingency related to one of these unsettled claims,
actions and judgments based on the Company's and Counsel's assessment for Old
Fashioned Syrup Company.

In addition to the aforementioned, the Company is party to various legal
proceedings generally incidental to its business as is the case with other
companies in the same industry. Although the ultimate disposition of legal
proceedings cannot be predicted with certainty, it is the opinion of management
that the outcome of any claim which is pending or threatened, either
individually or on a combined basis, will not have a materially adverse effect
on the consolidated financial statements of the Companies.

Significant Customers

For the year ended December 31, 2005, the Company, through the broadening of its
customer base, had two (2) customers that accounted for more than 10% of its
operating revenue. One customer accounted for approximately 17% and the other
approximately 11%. For the year ended December 31, 2004 the Company had two (2)
customers, which comprised approximately 75% of operating revenue.

Issuance of Stock for Services

The Company had retained a financial advisory firm as a business consultant to
assist in a variety of areas relating to financial, strategic and related
developmental growth of the Company requiring monthly payments of $10,000 to the
advisory firm. Upon termination, the Company would remain liable to the advisory
firm for transactions consummated within the subsequent twenty-four months
following the termination of the agreement. The relationship with this financial
advisory firm was terminated on February 28, 2006.

The Company retained a public relations advisory firm as a business consultant
to assist in a variety of areas relating to media and public relations of the
Company requiring monthly payments of $2,000.

NOTE 17 - STOCKHOLDERS' DEFICIENCY

Conversion of Preferred Stock into Common

On May 5, 2005, the Company issued 10,000,000 common shares relative to a
conversion of its series IV Preferred Stock in the amount of 25,000 shares.

In May 2005, the Company issued 200,000 shares of its common stock valued at
$42,000 in accordance with an agreement with a Director who resigned on March
31, 2005.

On July 11, 2005, we issued 25,000,000 shares of our common stock to Triple
Crown Consulting, Inc. and its assignees based on the conversion of 12,500
shares of Series IV Convertible Preferred stock.

On July 30, 2005, we issued 42,000,000 shares of our common stock to Triple
Crown Consulting, Inc. and its assignees based on the conversion of 12,500
shares of Series IV Convertible Preferred stock

On August 4, 2005, we issued 25,000,000 shares of our common stock to Triple
Crown Consulting, Inc. and its assignees based on the conversion of 12,500
shares of Series IV Convertible Preferred stock.

On August 19, 2005, we issued 25,000,000 shares of our common stock to Triple
Crown Consulting, Inc. and its assignees based on the conversion of 12,500
shares of Series IV Convertible Preferred stock.

On September 14, 2005, we issued 25,000,000 shares of our common stock to Triple
Crown Consulting, Inc. and its assignees based on the conversion of 12,500
shares of Series IV Convertible Preferred stock.

On October 27, 2005, we issued 100,000 shares of series III Preferred Stock to
two officers of Cargo Connection based on their investment of $100,000 into the
Company.


                                      F-19
<PAGE>

Issuance of Stock Related to Capital

On August 9, 2004, the Company entered into a Standby Equity Distribution
Agreement with Cornell. Pursuant to the Standby Equity Distribution Agreement,
the Company may, at its discretion, periodically issue and sell shares of our
common stock for a total purchase price of $15 million. If the Company requests
advances under the Standby Equity Distribution Agreement, Cornell will purchase
shares of common stock of the Company for 98% of the lowest volume weighted
average price on the Over-the-Counter Bulletin Board or other principal market
on which the Company common stock is traded for the 5 days immediately following
the advance notice date. Cornell will retain 5% of each advance under the
Standby Equity Distribution Agreement. The Company may not request advances in
excess of a total of $15 million. The maximum of each advance is equal to
$400,000. In connection with the Standby Equity Distribution Agreement, the
Company issued 8,315,789 shares of its common stock valued at $790,000 to
Cornell as a commitment fee and we issued 105,263 shares of our common stock
valued at $10,000 to Newbridge Securities as a placement agent fee. Such amounts
have been recorded as deferred offering costs on the consolidated balance sheet
at December 31, 2004. In April 2005, the Company and Cornell agreed to terminate
this agreement and all related shares of common stock are to be returned to the
Company. In May 2005, the 8,315,789 shares of common stock issued to Cornell
were returned and cancelled. The Company has requested, but has not received the
105,263 shares of common stock issued to Newbridge Securities.

Conversion of Notes Payable

On January 6, 2005, the Company issued 747,044 shares of common stock to Gamma
for the conversion of $25,000 of its promissory notes as requested in December
2004. The conversion has been recorded in January 2005.

On January 14, 2005, Latitude, holders of convertible promissory notes, had
$135,000 of its promissory notes converted into 5,500,000 shares of the
Company's common stock and $46,315 of accrued interest and $38,685 of additional
interest.

On January 24, 2005, Cornell, holders of convertible promissory notes, had
$10,000 of its promissory notes converted into 332,226 shares of the Company's
common stock.

On May 18, 2005, Montgomery, holders of convertible promissory notes, had
$15,000 of its promissory notes converted into 704225 shares of the Company's
common stock. The stock transfer agent issued and additional 3,000 shares under
this transaction.

On May 31, 2005, Montgomery, holders of convertible promissory notes, had
$11,000 of its promissory notes converted into 825,206 shares of the Company's
common stock.

On June 23, 2005, Alpha, holders of convertible promissory notes, had $50,000 of
its promissory notes converted into 3,125,000 shares of the Company's common
stock.

On July 21, 2005, we issued 2,083,333 shares of our common stock to Montgomery,
based on the conversion of $10,000 of a convertible promissory note.

On July 29, 2005 we issued 18,578,083 shares of our common stock to Alpha, based
on the conversion of $75,000 of a convertible promissory note.

On August 1, 2005, we issued 399,799 shares of our common stock to Montgomery,
based on the conversion of $2,065.54 of a convertible promissory note.

On August 4, 2005, we issued 7,783,084 shares of our common stock to Alpha,
based on the conversion of $30,000 of a convertible promissory note.

On August 16, 2005, we issued 1,500,000 shares of our common stock to
Montgomery, based on the conversion of $18,156 of a convertible promissory note.

On September 2, 2005, we issued 546,218 shares of our common stock to Advantage,
based on the conversion of $6,500 of a convertible promissory note.

On September 2, 2005, we issued 546,218 shares of our common stock to Advantage
Capital, based on the conversion of $6,500 of a convertible promissory note.


                                      F-20
<PAGE>

On September 14, 2005, we issued 1,818,182 shares of our common stock to
Montgomery, based on the conversion of $20,000 of a convertible promissory note.

On September 26, 2005, we issued 2,702,702 shares of our common stock to
Montgomery, based on the conversion of $20,000 of a convertible promissory note.

On October 12, 2005, we issued 3,681,908 shares of our common stock to
Montgomery, based on the conversion of $23,942 of a convertible promissory note
and $2,016 of accrued interest.

On November 7, 2005, we issued 736,382 shares of our common stock to Montgomery,
as consideration for damages incurred for failure to issue shares pursuant to a
convertible promissory note in a timely manner. These shares were valued at
$5,891.

On November 7, 2005, we issued 5,244,707 shares of our common stock to Alpha,
based on the conversion of $25,000 of a convertible promissory note and $3,321
of accrued interest.

Preferred Stock

Series III: The Company amended its articles of incorporation in April 2003 and
created 500,000 shares of Blank Check Series III Preferred Stock ("Series III"),
$1.00 par value. The Series III preferred stock may be issued in one or more
series, and each series will be so designated as to distinguish the shares
thereof from the shares of all other series. The Board of Directors has express
authority to fix, before the issuance of any shares of a particular series, the
number, designation, and relative rights, preferences and limitations of the
shares of such series.

      o     The Company is authorized to issue 500,000 shares of Series III
            preferred stock, $1.00 par value per share, of which 265,000 shares
            are issued and outstanding at December 31, 2005.

            o     On September 23, 2004, the Company designated 165,000 shares
                  of the class of its Series III Preferred Stock, par value
                  $1.00, to Triple Crown Consulting pursuant to a Promissory
                  Note with the Company dated August 5, 2004. The rights,
                  preferences, and privileges of the Series III Preferred Stock
                  are relative to those of the Series IV Preferred Stock, par
                  value $1.00, designated to Triple Crown Consulting, Inc. Such
                  shares are based on a convertible promissory note entered into
                  between the Company and the Investment Fund on August 5, 2004.

                  o     At the option of the Investment Fund, each outstanding
                        share of Series III Preferred Stock is convertible into
                        one share of common stock

            o     In October 2005, the Company designated 100,000 shares of the
                  class of its Series III Preferred Stock, par value $1.00, to
                  Jesse Dobrinsky and John L. Udell ("Investors and Officers")
                  as consideration for funds given to the Company. The rights,
                  preferences, and privileges of the Series III Preferred Stock
                  are relative to those of the Series IV Preferred Stock, par
                  value $1.00, designated to Triple Crown Consulting, Inc. Such
                  shares are based on an agreement entered into between the
                  Company and the Investors on October 26, 2005. At the option
                  of the Investors, each outstanding share of Series III
                  Preferred Stock is convertible into common stock based on the
                  following conversion formula: the conversion price per share
                  shall be equal to the lesser of (i) the average of the lowest
                  of three trading day trading prices during the five trading
                  days immediately prior to the conversion date multiplied by
                  .70, or (ii) the average of the lowest of the three day
                  trading prices during the five trading days immediately prior
                  to the funding date.

                  o     At the option of the Investment Fund, each outstanding
                        share of Series III Preferred Stock is convertible into
                        one share of common stock. In addition, the holders of
                        this Series III Preferred Stock and the holders of our
                        common stock along with the holders of Series IV
                        Preferred Stock shall vote together as a single class on
                        all actions to be taken by our shareholders. At all
                        meetings of the shareholders and in the case of any
                        actions of shareholders in lieu of a meeting, each
                        holder of the Series III Preferred Stock shall have
                        thirty times that number of votes on all matters
                        submitted to the shareholders that is equal to the
                        number of shares of common stock (rounded to the nearest
                        whole number) into which such holder's shares of Series
                        III Preferred Stock are then convertible, at the record
                        date for the determination of the shareholders entitled
                        to vote on such matters or, if no such record date is
                        established, at the date such vote is taken or any
                        written consent of such shareholders is effected. This
                        provision for determination of the number of votes to
                        which each holder of the Series III Preferred Stock is
                        entitled shall also apply in cases in which the holders
                        of the Series III Preferred Stock have the right to vote
                        together as a separate class.


                                      F-21
<PAGE>

o     Series IV: The Company amended its articles of incorporation in September,
      2003 and January, 2006 and increased to 600,000 shares its Series IV
      convertible Preferred Stock ("Series IV"), $1.00 par value. Each share of
      the Series IV preferred stock is convertible into one share of the
      Company's common stock. Each holder of the Series IV preferred stock has
      twenty times that number of votes on all matters submitted to shareholders
      that is equal to the number of shares of common stock into which such
      holder's shares of Series IV preferred stock are then convertible. In
      addition, the holders of the Series IV preferred stock are entitled to
      receive noncumulative cash dividends at an annual dividend rate as
      determined by the Board of Directors. The Series IV preferred stock has a
      liquidation price of $1.00 per share in the event of any liquidation,
      dissolution or winding up of the Company, whether voluntary or
      involuntary. The Company's articles of incorporation state that the Series
      IV preferred stock will be convertible into the Company's common stock at
      a conversion price equal to the lesser of (1) the average of the lowest of
      three-day trading prices during the five trading days immediately prior to
      the Conversion Date multiplied by .70, or (2) the average of the lowest of
      three-day trading prices during the five trading days immediately prior to
      the funding date(s).

      o     The Company is authorized to issue 600,000 shares of class IV
            preferred stock, $1.00 par value per share, of which 552,500 shares
            are issued and outstanding at December 31, 2005.

NOTE 18 - STOCK OPTION PLANS

In August 1999, the Company's stockholders approved the adoption of an Incentive
Stock Option Plan ("1999 Option Plan"), which allows the Board of Directors to
grant options to employees and members of the Board of Directors. The 1999
Option Plan provided the Board of Directors the right to grant options to
purchase up to a total of 100,000 shares of the Company's common stock. On
August 17, 2000, with the approval of the shareholders of the Company, the
number of shares available under the 1999 Option Plan was increased to
1,000,000. As of December 31, 2005, 220,000 options were outstanding under the
1999 Option Plan.

We currently have outstanding options to purchase 500,000 shares of common stock
granted to individuals outside of any equity compensation plan adopted by us
("Non-Plan Grants"). During the year ended December 31, 2005, the Company
granted on Non-Plan Grant to purchase 100,000 shares of common stock. Such
Non-Plan Grants were made pursuant to the terms of option agreements, as
applicable, with each such grant authorized by the board of directors of Cargo.
The Non-Plan Grants have not been approved by our stockholders.

Options to purchase common stock under the 1999 Option Plan have been granted to
Company employees at fair market value at the date of grant.

Stock options granted under the 1999 Option Plan generally become exercisable
immediately and expire 2 years from the date of grant.

The following information summarizes the Company's stock option activity at
December 31, 2005:

Stock Options Plans:

<TABLE>
<CAPTION>

                                                                                           Weighted
                                                                                           Average
                                                                                           Exercise
                                                                  Options                  Price
                                                                ------------               -----------
<S>                                                                <C>                     <C>
         Outstanding at December 31, 2003                          220,000                 $    1.07
                Granted                                                 --                        --
                Exercised                                               --                        --
                Expired or cancelled                                    --                        --
                                                                ------------               -----------

         Outstanding at December 31, 2004                          220,000                 $    1.07
                Granted                                                 --                        --
                Exercised                                               --                        --
                Expired or cancelled                                    --                        --
                                                                ------------               -----------
         Outstanding at December 31, 2005                          220,000                 $   1.07
                                                                ============               ===========
</TABLE>


                                      F-22
<PAGE>

Non-plan stock options:

<TABLE>
<CAPTION>

                                                                                           Weighted
                                                                                           Average
                                                                                           Exercise
                                                                  Options                  Price
                                                                ------------               -----------

<S>                                                                  <C>                   <C>
         Outstanding at December 31, 2003                            889,810               $     .61
                  Granted                                            400,000                     .14
                  Exercised                                               --                      --
                  Expired or cancelled                                    --                      --
                                                                ------------               -----------

         Outstanding at December 31, 2004                          1,289,810               $     .46
                  Granted                                            100,000                     .03
                  Exercised                                               --                      --
                  Expired or cancelled                               889,810                     .61
                                                                ------------               -----------
         Outstanding at December 31, 2005                            500,000               $     .07
                                                                ============               ===========
</TABLE>

The following table summarizes information about stock options outstanding and
exercisable at December 31, 2005

<TABLE>
<CAPTION>

                                                                Outstanding and exercisable
                                                        --------------------------------------------
                                                        Weighted
                                                        Average          Weighted
                                                        Remaining        Average
                                      Number            Life             Exercise        Number
                                      Outstanding       In Years         Price           Exercisable
                                      --------------    -----------      ----------      -----------
<S>                                       <C>                 <C>             <C>            <C>
Range of exercise price:
          $ .001 to   $.50                500,000              .75             .12           500,000
          $  .51 to  $1.00                    --                --              --                --
          $ 1.01 to  $1.50                220,000             3.71            1.07           220,000
                                      --------------                                     -----------
                                          720,000                                            720,000
                                      ==============                                     ===========
</TABLE>

NOTE 18 - RELATED PARTY TRANSACTIONS

The Company is due amounts from officers and related entities, which are not
included in these consolidated financial statements and are controlled by the
Companies' stockholders. These receivables are non-interest bearing and do not
have formal repayment terms. Management does not anticipate full collection of
these amounts within a one-year period.

The Company owes amounts to related entities not included in these consolidated
financial statements which are controlled by the Company's stockholders. These
amounts are non-interest bearing and do not bear formal repayment terms.

The Company rents warehouse space and equipment from related entities. For the
twelve months ended December 31, 2005, and 2004, rent expense charged to
operations related to these rentals totaled approximately $803,524 and $784,499
respectively. The leases contain various options for extending and terminate in
February 2014.

The Company and its related parties are guarantying a lease for a 92,000 square
foot facility located in Bensenville, Illinois for Underwing International.


                                      F-23
<PAGE>

Grant of Stock Options

During the quarter ended March 31, 2005, the then President of Championlyte was
granted options pursuant to the June 2003 two year employment agreement to
purchase 100,000 shares of the Company's common stock, which are exercisable at
$0.03 per share. The employment agreement entitled the President, as long as he
was employed with Champion, to purchase 100,000 shares of the Company's common
stock for each 90-day period through the term of the employment agreement. All
options would have a term of two years. The options are exercisable at a price
equal to 100% of the closing price of the stock as of the grant date. The
options become fully exercisable on the date of grant. During the six months
ended June 30, 2005, the fair value of the options using the Black-Scholes
Option Pricing Model was $3,000 and was being amortized to compensation expense
over the term of the employment agreement. Upon the resignation of the
President, which occurred concurrently with the reverse acquisition, any
unamortized compensation was expensed.

Employment Agreements - Terminated upon Reverse Acquisition

In April 2003, the Company's Board of Directors had passed a resolution to
compensate its directors and certain officer's 150,000 shares of common stock on
a quarterly basis. In February 2004, this had been amended to 175,000 shares of
the Company's common stock to reflect the addition of a new member to the
Company's Board of Directors. The Board of Directors had also included the then
President of the Company. The Board of Directors resigned on May 12, 2005 in
concurrence with the reverse acquisition. The Company does not currently have a
plan to compensate its new members of the Board of Directors.

In June 2003, Championlyte had entered into a formal employment agreement with
the then President of Championlyte. The agreement was for a term of two years.
The base salary for the executive was $3,500 per month, paid in the Company's
common stock in the first year, and $4,000 per month payable in the Company's
common stock in the second year. The employee was also entitled to commissions
based on sales made as a direct result of the employee's efforts in amounts
equal to 1% of gross sales payable on a quarterly basis.

NOTE 20 - SUBSEQUENT EVENTS

On January 6, 2006, we issued 4,566,210 shares of our common stock to
Montgomery, based on the conversion of $10,000 of a convertible promissory note.

On January 9, 2006, we issued 2,705,628 shares of our common stock to Advantage
Capital, based on the conversion of $5,000 of a convertible promissory note.

On January 9, 2006, we issued 4,032,258 shares of our common stock to Advantage,
based on the conversion of $10,000 of a convertible promissory note.

On January 19, 2006, we issued 3,436,426 shares of our common stock to
Montgomery, based on the conversion of $10,000 of a convertible promissory note.

On February 2, 2006, we issued 8,230,452 shares of our common stock to
Advantage, based on the conversion of $20,000 of a convertible promissory note.

On February 2, 2006, we issued 3,541,666 shares of our common stock to Advantage
Capital, based on the conversion of $8,500 of a convertible promissory note.

On February 2, 2006, we issued 8,230,452 shares of our common stock to
Montgomery, based on the conversion of $20,000 of a convertible promissory note.

On February 8, 2006, we issued 5,249,344 shares of our common stock to
Montgomery, based on the conversion of $20,000 of a convertible promissory note.

On February 16, 2006, we issued 8,264,463 shares of our common stock to
Montgomery, based on the conversion of $20,000 of a convertible promissory note.

On February 27, 2006, we issued 11,509,993 shares of our common stock to
Montgomery, based on the conversion of $20,000 of a convertible promissory note.


                                      F-24
<PAGE>

On March 1, 2006, we issued 3,496,503 shares of our common stock to Advantage
Capital, based on the conversion of $10,000 of a convertible promissory note.

On March 1, 2006, we issued 8,710,801 shares of our common stock to Advantage,
based on the conversion of $25,000 of a convertible promissory note.

On March 3, 2006, we issued 8,064,516 shares of our common stock to Montgomery,
based on the conversion of $25,000 of a convertible promissory note.

On March 7, 2006, we issued 6,053,269 shares of our common stock to Montgomery,
based on the conversion of $25,000 of a convertible promissory note.

On March 10, 2006, we issued 4,180,602 shares of our common stock to Advantage,
based on the conversion of $25,000 of a convertible promissory note.

On March 14, 2006, we paid $242,017.77 to Advantage, to redeem the remaining
balance, plus interest, of the convertible promissory note held by them.

On March 17, 2006, we paid $28,139.51 to Advantage Capital, to redeem the
remaining balance, plus interest, of the convertible promissory note held by
them.

On May 4, 2006, we issued 1,562,500 shares of our common stock to Montgomery,
based on the conversion of $10,000 of a convertible promissory note.

On May 4, 2006, we paid $40,559.72 to Montgomery, to redeem the remaining
balance, plus interest, of the convertible promissory note held by them.

NOTE 19 - INCOME TAXES

Prior to May 12, 2005, both Cargo Connection Logistics Corp. and Mid Coast
Management, Inc. had elected under the Subchapter S provisions of the Internal
Revenue Code to be treated as an "S" Corporation. Accordingly, there is no
provision for federal and state income taxes for the Companies for the year
ended December 31, 2004 and for the period January 1, 2005 through May 11, 2005,
because such liability is the responsibility of the individual shareholders.
Effective with the business combination as described in Note 1, Cargo Connection
Logistics Corp. and Mid Coast Management, Inc. will no longer qualify to be
taxed as "S" Corporations and therefore will be considered C-corporations
subject to federal, state and local corporate taxes beginning May 12, 2005.

Deferred income taxes reflect the net tax effects of temporary differences
between the carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for income tax purposes, as well as the expected
benefits of utilization of net operating loss carry-forwards. In assessing the
realization of deferred tax assets, management considers whether it is more
likely than not that some portion of the deferred tax assets will not be
realized. The ultimate realization of deferred tax assets is dependent upon the
generation of future taxable income during the periods in which those temporary
differences become deductible or the net operating losses can be utilized.
Management considers the scheduled reversal of deferred tax liabilities and
projected future taxable income in making this assessment.

A valuation allowance has been provided for the entire net deferred tax asset
due to the uncertainty surrounding the utilization of these deferred assets.

The Company has net operating loss carry-forwards for both federal and state
purposes totaling approximately $4,000,000 that will expire through 2025. At the
present time, a portion of the net operating loss carry-forwards for tax
purposes may not be currently available as the Company is behind schedule in the
filing of certain income tax returns.

Significant components of the Company's net deferred tax assets and liabilities
at December 31, 2005, are as follows:

Deferred tax assets:
  Net operating loss carry-forwards      $ 1,588,129
  Derivative liability                       861,101
  Deferred rents                             350,227
  Stock options                              262,000
  Asset reserves                             170,787
                                         -----------
Total deferred tax assets                  3,232,244
                                         -----------

Deferred tax liabilities:
  Debt                                      (789,928)
  Fixed assets                               (58,037)
                                         -----------
Total deferred tax liabilities              (847,965)
                                         -----------
Net deferred tax asset                     2,384,279
Deferred tax asset valuation allowance    (2,384,279)
                                         -----------
Net Deferred tax asset                   $         0
                                         ===========

The Company evaluates the amount of deferred tax assets that are recorded
against expected taxable income. As a result of this evaluation, the Company has
recorded a valuation allowance of $2,384,279 for the year ended December 31,
2005, representing a current year change in the valuation allowance of
$1,414,584. This allowance was recorded because, based on the weight of
available evidence, it is more likely than not that the deferred tax assets may
not be realized.

Income taxes computed at the federal statutory rate for the years ended December
31, 2005 and 2004 differ from amounts provided as follows:

                                                           2005         2004

Tax provision (benefit) at statutory rate                  (34%)        (34%)
State and local taxes, net of federal benefit               (6)          (6%)
Losses incurred before termination of S-elections            9           40
Change in valuation allowance                               31
                                                       -----------------------
Effective income tax rate                                   0%            0%
                                                       =======================


                                      F-25
<PAGE>

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

Friedman LLP is the Company's independent registered public accounting firm. At
no time has there been any disagreement with such accountants regarding any
matter of accounting principles or practices, financial statement disclosure, or
auditing scope or procedure.

a)    Previous Independent Auditors:

      (i) On June 17, 2005, Massella & Associates, CPA, PLLC was dismissed as
      our independent registered public accounting firm and Friedman LLP was
      appointed as our new independent registered public accounting firm

      (ii) During the two most recent fiscal years and interim period subsequent
      to December 31, 2004, there have been no disagreements with Massella &
      Associates, CPA, PLLC on any matter of accounting principles or practices,
      financial statement disclosure, or auditing scope or procedure.

      (iii) Massella & Associates, CPA, PLLC`s report on the financial
      statements for the year ended December 31, 2004 contained no adverse
      opinion or disclaimer of opinion and was not qualified or modified as to
      audit scope or accounting principles but included an explanatory paragraph
      reflecting an uncertainty because the realization of a major portion of
      our assets was dependent upon our ability to meet our future financing
      requirements and the success of future operations. These factors raised
      substantial doubt about our ability to continue as a going concern.

      (iv) Massella & Associates, CPA, PLLC furnished us with a letter addressed
      to the SEC stating that it agrees with the above statements. A copy of the
      letter to the SEC dated June 17, 2005, was filed as an Exhibit to our Form
      8-K filed on July 25, 2005 (SEC File No. 000-28223).

      (v) During the two most recent fiscal years and the interim period
      subsequent to December 31, 2004, there have been no reportable events with
      Massella & Associates, CPA, PLLC as set forth in Item 304(a)(i)(v) of
      Regulation S-K.

(b)   New Independent Registered Public Accounting Firm:

      (i) We engaged Friedman LLP as our new independent registered public
      accounting firm as of June 17, 2005. Prior to such date, we did not
      consult with Friedman LLP regarding (i) the application of accounting
      principles, (ii) the type of audit opinion that might be rendered by
      Friedman LLP, or (iii) any other matter that was the subject of a
      disagreement between us and our former independent registered public
      accounting firm as described in Item 304(a)(1)(iv) of Regulation S-B.


                                       21
<PAGE>

      Item 8A. - CONTROLS AND PROCEDURES

      (a) Evaluation of disclosure controls and procedures

      The Company's Chief Executive Officer and Chief Financial Officer, have
      evaluated the effectiveness of the Company's "disclosure controls and
      procedures" (as defined in Rules 13a-15(e) and 15d-15(e) under the
      Securities Exchange Act of 1934, as amended) as of the end of the period
      covered by this report. Based on that evaluation, the Company's Chief
      Executive Officer and Chief Financial Officer have identified the
      following material weaknesses:

      Management did not possess sufficient technical expertise nor have the
      needed knowledge base to properly account for and prepare financial
      footnotes in accordance with generally accepted accounting principles with
      regard to derivatives financing transactions.

      Management did not possess sufficient technical expertise nor have the
      needed knowledge base to properly account for and prepare financial
      footnotes in accordance with generally accepted accounting principles with
      regard to income taxes and deferred taxes.

      Management lacked certain internal controls over period-end reporting
      related to the identification of significant transactions, primarily
      equity transactions, embedded derivatives in certain financial
      instruments, which include among other things, convertible notes,
      freestanding warrant agreements and registration rights agreements and
      accounting for them in the proper periods. This deficiency resulted in a
      restatement of its financial statements for the three months ended March
      31, 2005, the three and six months ended June 30, 2005, and the three and
      nine months September 30, 2005, as appropriate to properly account for the
      above transactions.

As a result of the identification of the misapplication of US GAAP rules, our
Chief Executive Officer and Chief Financial Officer have concluded that, as of
December 31, 2005, our internal control over financial reporting was not
effective.

Remediation of Material Weaknesses

We have assigned a high priority to both the short-term and long-term
strengthening of these controls and have identified certain additional measures,
which we believe will address the conditions identified as a material weakness,
including the following:

      1) The Company has engaged an independent CFA to analyze the valuations
      pertaining to the embedded derivatives associated with the financial
      instruments.

      2) the Company has worked with an accounting firm (other than Company's
      independent auditor) to consult with on accounting issues;

      3) the Company will review new accounting pronouncements to determine the
      applicability to the Company;

      4) the Company will subscribe to professional publications that discuss
      new accounting rules and regulations;

      5) members of Company's accounting management will attend financial
      related seminars.

Based upon the above we believe we have set a plan in motion to correct any
significant deficiencies or material weaknesses or other factors that could
significantly affect these controls. Therefore the Company believes it will have
proper controls and procedures in place to deal with these transactions on a
go-forward basis.

(b) Changes in internal controls.

Except as set forth above, there have been no changes in our internal control
over financial reporting that occurred during the year ended December 31, 2005
that have materially affected, or are reasonably likely to materially affect,
our internal control over financial reporting.


                                       22
<PAGE>

                           PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

The company is party to a number of legal actions, which are not material to
business operations.

Item 2. Changes in Securities.

On October 3, 2005, we issued 2,702,702 shares of our common stock to
Montgomery, based on the conversion of $20,000 of a convertible promissory note.
The issuance was valued at 20,000 or $.0074 per share.

On October 12, 2005, we issued 3,681,908 shares of our common stock to
Montgomery, based on the conversion of $23,942 of a convertible promissory note
and $2,016 of accrued interest. The issuance was valued at $.0070 per share.

On November 15, 2005, we issued 736,382 shares of our common stock to Montgomery
as consideration for damages incurred for failure to issue shares pursuant to a
convertible promissory note in a timely manner. These shares were valued at
$5,891 or $.008 per share.

On November 21, 2005, we issued 5,244,707 shares of our common stock to Alpha,
based on the conversion of $25,000 of a convertible promissory note and $3,321
of accrued interest. The issuance was valued at $.0048 per share.

All of the above issued shares were issued in reliance on the exemption from
registration provided by Section 4(2) of the Securities Act of 1933. No
commissions were paid for the issuance of such shares. All of the above
issuances of shares of our common stock qualified for exemption under Section
4(2) of the Securities Act of 1933 since the issuance of such shares by us did
not involve a public offering. All shareholders were sophisticated investors and
had access to information normally provided in a prospectus regarding us. The
offering was not a "public offering" as defined in Section 4(2) due to the
insubstantial number of persons involved in the deal, size of the offering,
manner of the offering and number of shares offered. We did not undertake an
offering in which we sold a high number of shares to a high number of investors.
In addition, all shareholders had the necessary investment intent as required by
Section 4(2) since he agreed to and received a share certificate bearing a
legend stating that such shares are restricted pursuant to Rule 144 of the 1933
Securities Act. These restrictions ensure that these shares would not be
immediately redistributed into the market and therefore not be part of a "public
offering." Based on an analysis of the above factors, we have met the
requirements to qualify for exemption under Section 4(2) of the Securities Act
of 1933 for the above transaction.

SUBSEQUENT EVENTS

On January 6, 2006, we issued 4,566,210 shares of our common stock to
Montgomery, based on the conversion of $10,000 of a convertible promissory note.

On January 9, 2006, we issued 2,705,628 shares of our common stock to Advantage
Capital, based on the conversion of $5,000 of a convertible promissory note.

On January 9, 2006, we issued 4,032,258 shares of our common stock to Advantage,
based on the conversion of $10,000 of a convertible promissory note.

On January 19, 2006, we issued 3,436,426 shares of our common stock to
Montgomery, based on the conversion of $10,000 of a convertible promissory note.

On February 2, 2006, we issued 8,230,452 shares of our common stock to
Advantage, based on the conversion of $20,000 of a convertible promissory note.

On February 2, 2006, we issued 3,541,666 shares of our common stock to Advantage
Capital, based on the conversion of $8,500 of a convertible promissory note.

On February 2, 2006, we issued 8,230,452 shares of our common stock to
Montgomery, based on the conversion of $20,000 of a convertible promissory note.

On February 8, 2006, we issued 5,249,344 shares of our common stock to
Montgomery, based on the conversion of $20,000 of a convertible promissory note.


                                       23
<PAGE>

On February 16, 2006, we issued 8,264,463 shares of our common stock to
Montgomery, based on the conversion of $20,000 of a convertible promissory note.

On February 27, 2006, we issued 11,509.993 shares of our common stock to
Montgomery, based on the conversion of $20,000 of a convertible promissory note.

On March 1, 2006, we issued 3,496,503 shares of our common stock to Advantage
Capital, based on the conversion of $10,000 of a convertible promissory note.

On March 1, 2006, we issued 8,710,801 shares of our common stock to Advantage,
based on the conversion of $25,000 of a convertible promissory note.

On March 3, 2006, we issued 8,064,516 shares of our common stock to Montgomery,
based on the conversion of $25,000 of a convertible promissory note.

On March 7, 2006, we issued 6,053,269 shares of our common stock to Montgomery,
based on the conversion of $25,000 of a convertible promissory note.

On March 10, 2006, we issued 4,180,602 shares of our common stock to Advantage,
based on the conversion of $25,000 of a convertible promissory note.

On March 14, 2006, we paid $242,017.77 to Advantage, to redeem the remaining
balance, plus interest, of the convertible promissory note held by them.

On March 17, 2006, we paid $28,139.51 to Advantage Capital, to redeem the
remaining balance, plus interest, of the convertible promissory note held by
them.

On May 4, 2006, we issued 1,562,500 shares of our common stock to Montgomery,
based on the conversion of $10,000 of a convertible promissory note.

On May 4, 2006, we paid $40,559.72 to Montgomery, to redeem the remaining
balance, plus interest, of the convertible promissory note held by them.

Our shares were issued in reliance on the exemption from registration provided
by Section 4(2) of the Securities Act of 1933. No commissions were paid for the
issuance of such shares. All of the above issuances of shares of our common
stock qualified for exemption under Section 4(2) of the Securities Act of 1933
since the issuance of such shares by us did not involve a public offering.

Item 3. Defaults Upon Senior Securities.
Not Applicable

Item 4. Submission of Matters to a Vote of Security Holders.
None

Item 5. Other Information.
None


                                       24
<PAGE>

                                    PART III

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

Officers and Directors

Our directors and officers, as of May 19, 2006, are set forth below. The
following sets forth the names, ages, and titles of each of our directors and
executive officers.

<TABLE>
<CAPTION>

NAME                                AGE              DIRECTOR/POSITION(1)
----                                ---              --------------------

<S>                                 <C>              <C>
Jesse Dobrinsky                     50               President, Principal Executive Officer and Chairman of the Board of
                                                     Directors; President, Cargo Connection Logistics Corp. our subsidiary;
                                                     CEO, Mid-Coast Management, Inc. our subsidiary.

Scott Goodman                       46               Principal Financial Officer, Chief Operating Officer, Secretary and
                                                     Director; Executive Vice President, Treasurer and Secretary, Cargo
                                                     Connection Logistics Corp. our subsidiary; Treasurer and Secretary,
                                                     Mid-Coast Management, Inc. our subsidiary.

John L. Udell                       50               Vice President; Vice President and Assistant Secretary, Cargo
                                                     Connection Logistics Corp. our subsidiary; Vice President and
                                                     Assistant Secretary, Mid-Coast Management, Inc. our subsidiary.
</TABLE>

(1) Officers and Directors
      a.    All Directors of the Company will hold office until the next annual
            meeting of shareholders of the Company or until their successors are
            duly elected and qualified.
      b.    The Officers of the Company are appointed by the Board of Directors
            at the first meeting after each annual meeting of the Company's
            shareholders, and hold office until their death, or until they shall
            resign or have been removed.

The following is a biographical summary of our directors and officers:

Jesse Dobrinsky, President, Chief Executive Officer and Director. Jesse was born
in 1956. He was raised and educated in New York. Jesse has been an entrepreneur
all of his life. While working his way through college, Jesse worked as an
assistant pharmacist and an assistant manager for Edison Brothers Shoes. In
mid-1978 he and an associate opened a retail stereo shop called Sounds
Incredible. They grew this business until the sales volume was in excess of one
(1) million dollars per year. In 1981, Jesse was enticed into a family
restaurant business where he spent the next year building up the business. In
1982, Jesse was given the opportunity to open a sales agency for a group of
Midwestern meat haulers. This company was called Coast Dispatch, Inc. It was
started in a small office in Manhattan and its focus was to sell westbound
freight from the Northeastern portion of the United States. As this business
grew, the customers began to inquire about trucks to haul freight throughout the
country. In early 1983 Coast Dispatch, Inc. became an irregular route common
carrier. Over the next twelve years Coast Dispatch, Inc. grew to over 40 company
trucks and ten million dollars in sales. In 1995, Landstar-Inway approached
Jesse and asked him to open an Air-Freight Division for the Landstar group. This
division was called Cargo Connection Logistics. With Jesse at the helm the
company grew from less than three million dollars in sales in 1996 to over five
million dollars in sales in 1997. In late 1997, Landstar-Inway was directed to
refocus on their core business and to disband any business that was not related
to that core business. In 1997, Cargo Connection Logistics became a non-owned
division of ARL and in 1998, did in excess of eight million dollars in sales. In
1999, the sales volume exceeded twelve million dollars and Cargo Connection
Logistics became the largest non-owned division of ARL.


                                       25
<PAGE>

Scott Goodman, Chief Financial Officer, Chief Operating Officer, Secretary and
Director. Scott was born in 1959. He attended schools in New York and
Massachusetts. Scott holds a Bachelor of Science Degree in Business
Administration with a major in accounting from Northeastern University. He also
obtained his MBA from Adelphi University with majors in International Business
and Corporate Finance. Scott began his career with Norman Goldstein Associates
where his primary duties were as Controller for NGA and as Director of
Operations for its subsidiary company, E & N Plastics. It was at this company
that Scott began to travel the world. In 1983, Scott joined M. Blumenthal
Graphics, a New York City printing house, as Controller and later as Director of
Operations. In 1988, Scott went to work for Lafayette Precision Products. As
Controller and Director of Purchasing, Scott was responsible for overseeing and
managing the installation and implementation of a new computer system. In
addition, he was very involved with developing new procedures for purchasing,
inventory control and financial reporting. When Reichel & Drews bought the
company and ultimately moved the operation to their headquarters in Itasca, IL
in 1990, Scott went to work for Landes Marketing. At Landes Marketing Scott held
dual positions as their Vice President and General Manager. He joined them in
order to restructure their financial debt and reduce costs after heavy losses
were sustained by the Landes family. Landes was a leader in the marketing and
distribution of silver-plated tabletop and giftware. It was in this position
that Scott began to develop a deeper understanding of the import business. One
of the vendors Scott became intimate with was Ben Forman & Sons. In 1992, when
Landes Marketing was being sold, Scott went to work for Ben Forman & Sons where
he was responsible for the financial area of the multi-million dollar
manufacturing company. He was also responsible for the company's related
real-estate ventures. In 1995 Scott Goodman met Jesse Dobrinsky. In late 1995,
he went to work for Coast Dispatch, Inc. as its CFO. In 1996 Scott joined Jesse
Dobrinsky at Cargo Connection Logistics, where they went to work for
Landstar-nway. With Jesse Dobrinsky as President, Scott joined the team as
Executive Vice President. The company grew from less than three million dollars
in sales in 1996 to over five million in sales in 1997. In late 1997,
Landstar-Inway was directed to refocus on their core business and to disband any
business that was not related to that main business focus. In 1997, Cargo
Connection Logistics became a non-owned division of ARL and in 1998 had sales
volumes in excess of eight million dollars. In 1999, the sales volume exceeded
twelve million dollars and Cargo Connection Logistics became the largest
non-owned division of ARL.

John L. Udell, Vice President. John was born in 1955. He was raised and educated
in New York. John has had an entrepreneurial spirit his whole life. While
working his way through college, John had many jobs. In 1976, before completing
his education, John was called home from school to help save the family
business. Later that year, John became the Director of the Finishing Division
for AMPCO Printing Company. It became John's responsibility to make sure that
jobs were finished properly and shipped out in a timely manner. While performing
this job it became clear to John that there was a need for and ultimately an
opportunity for a trucking company that could provide expedited service for the
printing industry. He took this concept to a friend and in 1982, Jesse Dobrinsky
and John Udell formed a company called Coast Dispatch, Inc. John soon found
himself intrigued by the growth and opportunity at Coast Dispatch, Inc. He soon
decided to make it his full time career. Over the next 12 years John was very
instrumental in the development and growth of Coast Dispatch, Inc. In 1996, when
Jesse departed from the company, John became its President and began to lead the
company into a rebuilding process. It was his dream to build a regional trucking
company that would focus on the New York Tri-State Area. In 1996, after bringing
the company through a major overhaul, the investors chose to shut down the
company. During that last year John had managed to reduce the debts of Coast
Dispatch, Inc. from just over two million dollars to less than fifty thousand
dollars. John spent the balance of the year closing Coast Dispatch, Inc. and
selling off the assets of the company. In mid-1997, John joined Cargo Connection
Logistics as its Director of Container Freight Station Operations. In that
capacity, John managed the two main CFS operations in New York and Chicago. John
also headed up both the Safety & Compliance and Driver Recruitment Departments.

Code of Ethics

We have adopted a Code of Ethics within the meaning of Item 406(b) of Regulation
S-K of the Exchange Act. This Code of Ethics applies to directors and senior
officers, such as the principal executive officer, principal financial officer,
controller, and persons performing similar functions, of ours. Such code of
ethics is filed as an exhibit to the accompanying registration statement.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Exchange Act requires our executive officers directors and
persons who beneficially own more than ten percent of a registered class of our
equity securities ("Reporting Persons") to file reports of beneficial ownership
and changes in beneficial ownership on Forms 3, 4 and 5 with the SEC. These
Reporting Persons are required by SEC regulation to furnish us with copies of
all Forms 3, 4 and 5 that they file with the SEC. Based solely upon our review
of the copies of all Forms 3, 4 and 5 and amendments to these forms, we believe
that all Reporting Persons complied on a timely basis with all filing
requirements applicable to them with respect to our fiscal year ended December
31, 2005.


                                       26
<PAGE>

Term of Office

Directors

Our Board of Directors currently consists of 2 seats. However, up to 7 may be
elected to serve on the Board. Directors serve for a term of one year and stand
for election at our annual meeting of stockholders. Pursuant to our Bylaws, a
majority of directors may appoint a successor to fill any vacancy on the Board
of Directors. All Directors of the Company will hold office until the next
annual meeting of shareholders of the Company or until their successors are duly
elected and qualified. There are no agreements with respect to the election of
Directors. We have not compensated our Directors for service on our Board of
Directors, any committee thereof, or reimbursed for expenses incurred for
attendance at meetings of our Board of Directors and/or any committee of our
Board of Directors.

Officers

The officers of the Company are appointed by the Board of Directors at the first
meeting after each annual meeting of the Company's shareholders, and hold office
until their death, or until they shall resign or have been removed.

None of our Officers and/or Directors have filed any bankruptcy petition, been
convicted of or been the subject of any criminal proceedings or the subject of
any order, judgment or decree involving the violation of any state or federal
securities laws within the past five (5) years.

Committees

The Company has not established any committees at this time.

Audit Committee

We do not have a standing audit committee of the Board of Directors. Management
has determined not to establish an audit committee at present because of our
limited resources and limited operating activities do not warrant the formation
of an audit committee or the expense of doing so. We do not have a financial
expert serving on the Board of Directors or employed as an officer based on
management's belief that the cost of obtaining the services of a person who
meets the criteria for a financial expert under Item 401(e) of Regulation S-B is
beyond its limited financial resources and the financial skills of such an
expert are simply not required or necessary for us to maintain effective
internal controls and procedures for financial reporting in light of the limited
scope and simplicity of accounting issues raised in its financial statements at
this stage of its development.

Certain Legal Proceedings

No director, nominee for director, or executive officer of the Company has
appeared as a party in any legal proceeding material to an evaluation of his
ability or integrity during the past five years.

Item 10. - EXECUTIVE COMPENSATION

The following table sets forth information concerning annual and long-term
compensation, on an annualized basis for the 2005 fiscal year, for our Chief
Executive Officer and for each of our other executive officers (the "Named
Executive Officers") whose compensation on an annualized basis is anticipated to
exceed $100,000 during fiscal 2006.


                                       27
<PAGE>

                           Summary Compensation Table

The following table shows the compensation paid over the past three fiscal years
with respect to the named Executive Officers whose compensation on an annualized
basis is anticipated to exceed $100,000 during fiscal 2006:

<TABLE>
<CAPTION>

                                                                                       LONG-TERM COMPENSATION
                                                                          ------------------------------------------------
                                           ANNUAL COMPENSATION              AWARDS           PAYOUTS
                                    -----------------------------------   ----------  --------------------
          (a)              (b)       (c)          (d)           (e)          (f)         (g)         (h)          (i)
--------------------      ----      ------       -----     ------------   ----------  ----------   -------    ------------
                                                                                      Securities
                                                                          Restricted  Underlying   LTIP
Name and Principal                  Salary       Bonus     Other Annual     Stock      Options     Payouts      All Other
Position                  Year       ($)          ($)      Compensation    Award(s)      ($)       SARs(1)    Compensation
--------------------      ----     --------      -----     ------------   ----------  ----------   -------    ------------
<S>                       <C>      <C>
Jesse Dobrinsky           2005     125,577
President and             2004     160,462
Chief Executive Officer   2003     179,943

Scott Goodman             2005     108,077
Chief Financial Officer,  2004     142,904
Chief Operating Officer   2003     157,731
And Secretary

John L. Udell             2005      95,192
Vice President            2004     112,804
                          2003     141,288
</TABLE>


<TABLE>
<CAPTION>

                             OPTION/SAR GRANTS TABLE

                                                                            % TOTAL
                                                                         OPTIONS/SAR'S
                                                                          GRANTED TO
                                                  NO. OF SECURITIES    EMPLOYEES IN YEAR
                                                      UNDERLYING             ENDED
                                                    OPTIONS/SAR'S         DECEMBER 31,       EXERCISE OR
                                                       GRANTED               2005            BASE PRICE
NAME                                                     (#)                  (%)           ($ PER SHARE)    EXPIRATION DATE
------------------------------------------        -----------------    ----------------     -------------    ---------------
<S>                                                     <C>                 <C>                  <C>                <C>
Jesse Dobrinsky                                               --                   --               --               --
  President and Chief Executive Officer

Scott Goodman                                                 --                   --               --               --
  Chief Financial Officer, Chief Operating
  Officer and Secretary

John L. Udell                                                 --                   --               --               --
  Vice President
</TABLE>

The following table contains information regarding options exercised in the year
ended December 31, 2005, and the number of shares of common stock underlying
options held as of December 31, 2005, by Cargo Connection's named executive
officers.

<TABLE>
<CAPTION>

                                             AGGREGATED OPTIONS/SAR EXERCISES
                                                  IN LAST FISCAL YEAR AND
                                            FISCAL YEAR END OPTIONS/SAR VALUES

                                                                  NUMBER OF SECURITIES
                                                                 UNDERLYING UNEXERCISED
                                 SHARES                              OPTIONS/SAR'S             IN THE MONEY OPTIONS/SAR'S
                              ACQUIRED ON                              AT FY END                       AT FY END
                                EXERCISE     VALUE REALIZED               (#)                             ($)
                              -----------    --------------   ----------------------------    ----------------------------
NAME                              (#)             ($)         EXERCISABLE    UNEXERCISABLE    EXERCISABLE    UNEXERCISABLE
---------------------------   -----------    --------------   -----------    -------------    -----------    -------------
<S>                                     <C>             <C>             <C>             <C>             <C>             <C>
Jesse Dobrinsky
  President and Chief
  Executive Officer                    --               --             --              --              --              --

Scott Goodman
  Chief Financial Officer,
  Chief Operating Officer
  and Secretary                        --               --             --              --              --              --

John L. Udell
  Vice President                       --               --             --              --              --              --
</TABLE>


                                       28
<PAGE>


ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth information about the beneficial ownership of our
common stock as of May 19, 2006, by (i) each person who we know is the
beneficial owner of more than 5% of the outstanding shares of common stock (ii)
each of our directors or those nominated to be directors, and executive
officers, and (iii) all of our directors and executive officers as a group.

                              Amount and
                                Nature        Percentage
       Name and Address      of Beneficial     of Common
     of Beneficial Owner       Ownership       Stock(1)
--------------------------   -------------   ------------
Jesse Dobrinsky (2)(3)(4)
  600 Bayview Avenue
  Inwood, New York 11096        71,879,738           8.13%

John L. Udell (3)(4)
  600 Bayview Avenue
  Inwood, New York 11096        71,879,738           8.13%

Scott Goodman (3)
  600 Bayview Avenue
  Inwood, New York 11096        71,879,738           8.13%

All officers and directors     215,639,214          24.39%

(1)   Applicable percentage of ownership is based on 883,903,741 shares of
      common stock outstanding as of May 19, 2006. Beneficial ownership is
      determined in accordance with the rules of the SEC and generally includes
      voting or investment power with respect to securities. Shares of common
      stock subject to securities exercisable or convertible into shares of
      common stock that are currently exercisable or exercisable December 31,
      2005 are deemed to be beneficially owned by the person holding such
      options for the purpose of computing the percentage of ownership of such
      person, but are not treated as outstanding for the purpose of computing
      the percentage ownership of any other person.

(2)   Jesse Dobrinsky has a proxy from Triple Crown Consulting, Inc., which is
      the holder of 552,500 Series IV Preferred shares outstanding. As such he
      has the right to vote twenty times the number of shares of common stock
      that the Series IV Preferred Stock is convertible at such time as a vote
      is taken.

(3)   On May 12, 2005, pursuant to the Stock Purchase Agreement and Share
      Exchange between the Company, Cargo Connection Logistics Corp. and
      Mid-Coast Management, Inc., these shareholders have an agreement in place
      that they will be issued shares at the end of twelve months from the
      effective date of the Agreement so that these shareholders will own a
      total of eighty (80%) of the outstanding shares of the Company at such
      time. Therefore, on May 12, 2006, these individuals will be issued shares
      equal to eighty (80%) percent of the outstanding shares of the Company at
      such time.

(4)   Jesse Dobrinsky and John L. Udell each are holders of 50,000 Series III
      Preferred shares outstanding, respectively. As such each has the right to
      vote thirty times the number of shares of common stock that the Series III
      Preferred Stock is convertible at such time as a vote is taken.


                                       29
<PAGE>

Stock Options

The following table sets forth information with respect to stock options granted
to our named executive officers during fiscal year 2005 that have not been fully
amortized:

                        OPTION/SAR GRANTS IN FISCAL 2005
                               (INDIVIDUAL GRANTS)

<TABLE>
<CAPTION>
                  NUMBER OF               % OF TOTAL OPTIONS/SARs
                  SECURITIES UNDERLYING   GRANTED TO EMPLOYEES      EXERCISE   EXPIRATION
NAME              OPTIONs/SARs GRANTED    IN FISCAL YEAR 2005       PRICE      DATE
----              --------------------    -------------------       -----      ----
<S>               <C>                     <C>                       <C>        <C>
David Goldberg    100,000                 100,000                   $.03       June 30, 2007
</TABLE>

The following table sets forth information as to the number of shares of common
stock underlying unexercised stock options and the value of unexercised
in-the-money stock options projected at the 2006 fiscal year end:

None

SERIES III CONVERTIBLE PREFERRED STOCK

                         Number of
                         Shares of        Percent of       Number of Shares of
                         Series III       Series III       Common Stock Into
                         Convertible      Convertible      Which Series III
                         Preferred Stock  Preferred Stock  Convertible Preferred
                         Beneficially     Beneficially     Stock are
Name of Shareholder      Owned(1)         Owned            Convertible(2)
-------------------      --------         -----            --------------

Advantage Fund I, LLC     165,000            62.26%           165,000
Jesse Dobrinsky            50,000            18 87%            50,000
John L. Udell              50,000            18.87%            50,000

(1)   Unless otherwise indicated, the persons or entities identified in these
      tables have sole voting and investment power with respect to all shares
      shown as beneficially held by them, subject to community property laws
      where applicable.
(2)   As of December 31, 2005.


                                       30
<PAGE>

SERIES IV CONVERTIBLE PREFERRED STOCK

                        Number of
                        Shares of         Percent of         Number of Shares of
                        Series IV         Series IV          Common Stock Into
                        Convertible       Convertible        Which Series IV
                        Preferred Stock   Preferred Stock    Convertible
                        Beneficially      Beneficially       Preferred Stock
Name of Shareholder     Owned(1)          Owned              are Convertible(2)
-------------------     --------          -----              --------------

Triple Crown
  Consulting, Inc.(3)   552,500          100%                552,500

(1)      Unless otherwise indicated, the persons or entities identified in these
         tables have sole voting and investment power with respect to all shares
         shown as beneficially held by them, subject to community property laws
         where applicable.
(2)      As of December 31, 2005
(3)      Benjamin Kaplan is the owner of Triple Crown Consulting, Inc.

ITEM 12. - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Cargo Connection Logistics Corp. has had transactions with a related party. The
transactions were with CDI Management, Inc., which is controlled by Jesse
Dobrinsky, Scott Goodman, John L. Udell and Jay Finkelstein. Messrs. Dobrinsky
and Goodman are officers, directors and shareholders of our Company. Mr. Udell
is an officer and shareholder of our Company. Mr. Finkelstein is a shareholder
of our Company. CDI furnished both rental property and equipment leases for
Cargo Connection Logistics Corp. The transactions for the past three years were:

Year                     Rental Property                Equipment Leases
--------------------------------------------------------------------------------
2005                     $85,680                        $14,400
2004                     $85,680                        $14,400
2003                     $85,680                        $18,000

Cargo Connection Logistics Corp. has had transactions with a related party. The
transactions were with Underwing International, LLC., which is controlled by
Jesse Dobrinsky, Scott Goodman, John L. Udell and Jay Finkelstein. Messrs.
Dobrinsky and Goodman are officers, directors and shareholders of our Company.
Mr. Udell is an officer and shareholder of our Company. Mr. Finkelstein is a
shareholder of our Company. Underwing furnished equipment leases for Cargo
Connection Logistics Corp. The transactions for the past three years were:

Year                                                    Equipment Leases
--------------------------------------------------------------------------------
2005                                                    $  4,800
2004                                                    $  4,800
2003                                                    $  4,800

Mid-Coast Management, Inc. has had transactions with a related party. The
transactions were with CDI Management, Inc., which is controlled by Jesse
Dobrinsky, Scott Goodman, John L. Udell and Jay Finkelstein. Messrs. Dobrinsky
and Goodman are officers, directors and shareholders of our Company. Mr. Udell
is an officer and shareholder of our Company. Mr. Finkelstein is a shareholder
of our Company. CDI furnished both rental property and equipment leases for
Cargo Connection Logistics Corp. The transactions for the past three years were:

Year                     Rental Property                Equipment Leases
--------------------------------------------------------------------------------
2005                     $  582,000                     $14,400
2004                     $  376,000                     $14,400
2003                     $      -0-                     $21,600


                                       31
<PAGE>

Cargo Connection Logistics Holdings, Inc. has had transactions with a related
party. In October, 2005, Cargo Connection Logistics Holdings, Inc. was loaned
$75,000 by certain officers of the Company. This loan is collateralized through
a convertible note at an interest rate of 15%. The certain officers are Jesse
Dobrinsky, Scott Goodman and John L. Udell. Messrs. Dobrinsky and Goodman are
officers, directors and shareholders of our Company. Mr. Udell is an officer and
shareholder of our Company.

Cargo Connection Logistics Holding, Inc. has had transactions with related
parties. On October 27, 2005, Cargo Connection Logistics received funds through
the sale of certain preferred stock of the Company. The Company received
$100,000 from certain officers of the Company in return for the issuance of
Series III Preferred Stock. The certain officers are Jesse Dobrinsky and John L.
Udell. Mr. Dobrinsky is an officer, director and shareholders of our Company.
Mr. Udell is an officer and shareholder of our Company.


                                     PART IV

A. ITEM 13. EXHIBITS LIST AND REPORTS ON FORM 8-K

      (a)   Reports on Form 8-K and Form 8K-A

On January 25, 2005, we filed a Form 8-K when the Company engaged Knightsbridge
Capital to assist in exploring strategic options on behalf of the Company.

On April 8, 2005, we filed a Form 8-K for a change in accountant.

On May 18, 2005, we filed a Form 8-K when we entered into a Stock Purchase
Agreement and Share Exchange with Cargo Connection Logistics Holding, Inc. and
Mid-Coast Management, Inc.

On June 22, 2005, we filed a Form 8-K for a change in accountant.

On July 25, 2005, we filed an Amended Form 8-K to the June 22, 2005 Form 8-K
change in accountant.

On July 28, 2005, we filed an Amended Form 8-K for the May 18, 2005 Form 8-K
filed pursuant to the Stock Purchase Agreement and Share Exchange with Cargo
Connection Logistics Holding, Inc. and Mid-Coast Management, Inc.

      (b)   Exhibits

3.1(1)   Articles of Incorporation

3.2(1)   By-laws

4.1(2)   Company 2005 Stock Incentive Plan

10.1(3)  Stock Purchase Agreement and Share Exchange by and among Championlyte
         Holdings, Inc., the Company and Mid-Coast Management, Inc. effective
         May 10, 2005

10.2(4)  Securities Purchase Agreement dated December 28, 2005, by and between
         the Company and Montgomery Equity Partners, Ltd.

10.3(4)  Secured Convertible Debenture in the amount of $1,750,000 dated
         December 28, 2005


                                       31
<PAGE>

10.4(4)  Investor Registration Rights Agreement dated December 28, 2005, by and
         between the Company and Montgomery Equity Partners, Ltd.

10.5(4)  Warrant for 2,000,000 shares dated December 28, 2005

10.6(4)  Security Agreement dated December 28, 2005, by and between the Company
         and Montgomery Equity Partners, Ltd.

10.7(4)  Escrow Agreement dated December 28, 2005, by and among the Company,
         Montgomery Equity Partners, Ltd. and David Gonzalez, Esq.

10.8(4)  Subsidiary Security Agreement dated December 28, 2005, by and among the
         Company, Mid-Coast Management, Inc. and Montgomery Equity Partners,
         Ltd.

10.9(4)  Agreement of Lease, dated March 10, 2001, by and between CDI
         Management, Inc. and Cargo Connection Logistics Corp.

10.10(4) Commercial Lease Contract, dated October 22, 2003, by and between M.D.
         Hodges Enterprises, Inc. and Cargo Connection Logistics Corp.

10.11(4) Lease, dated October 12, 2004, by and between Ralston Industries, Inc.
         and Mid-Coast Management, Inc.

10.12(4) Agreement of Lease, dated February 16, 2004, by and between CDI
         Management, Inc. and Mid-Coast Management, Inc.

10.13(4) Industrial Multi-Tenant Lease, dated September 30, 2004, by and between
         AMB HTD-Beacon Centre, LLC and Cargo Connection Logistics Corp.

10.14(4) Commercial Lease Agreement, dated January 31, 2005, by and between MP
         Cargo ORD Property, LLC and Underwing International, LLC

14(4)    Code of Ethics

31.1     Certification of Jesse Dobrinsky pursuant to 18 U.S.C. Section 1350 as
         adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2     Certification of Scott Goodman pursuant to 18 U.S.C. Section 1350 as
         adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1     Certification of Jesse Dobrinsky pursuant to 18 U.S.C. Section 1350 as
         adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2     Certification of Scott Goodman pursuant to 18 U.S.C. Section 1350 as
         adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

(1)   Incorporated by reference to the Company's Form 10-KSB originally filed
      with the Securities and Exchange Commission on November 19, 1999 (SEC
      file: 000-28223)
(2)   Incorporated by reference to the Company's current report on Form 8-K
      filed with the Securities and Exchange Commission on May 18, 2005
(3)   Incorporated by reference to the Company's current report on Form 8-K
      filed with the Securities and Exchange Commission on January 9, 2006
(4)   Incorporated by reference to the Company's Form SB-2 Registration
      Statement filed with the Securities and Exchange Commission on February
      14, 2006


                                       32
<PAGE>

Item 14. - Principal Accountant Fees and Services

Audit Fees

Friedman, LLP provided audit services for us for pertaining to our fiscal year
ended December 31, 2005 and December 31, 2004. The aggregate fees billed by
Friedman, LLP for the audit of our annual financial statements and review of our
financial statements was $146,168 incurred during our fiscal year ended December
31, 2005 and $-0- for fiscal year ended December 31, 2004.

Tax Fees

There were no fees billed for our fiscal year ended December 31, 2005 for any
professional tax advice or tax planning services rendered by Friedman, LLP.

All Other Fees

There were no fees billed for the fiscal year ended December 31, 2005 for
professional services rendered by Friedman, LLP for all other services not
disclosed above.


                                       33
<PAGE>

                                   SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.

Dated: May 19, 2006


                                 CARGO CONNECTION LOGISTICS HOLDING, INC.


                                 By: /s/ Jesse Dobrinsky
                                     ------------------------------------
                                     Jesse Dobrinsky,
                                     President and Chief Executive Officer



                                POWER OF ATTORNEY

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
this Annual Report on Form 10-K has been signed on May 19, 2006 by the following
persons on behalf of the Registrant, in the capacities indicated.


                              /s/ Jesse Dobrinsky
                              --------------------------------------------------
                              Jesse Dobrinsky, President, Chief Executive
                              Officer and Director (Principal Executive Officer)


                              /s/ Scott Goodman
                              --------------------------------------------------
                              Scott Goodman, Chief Financial Officer,
                              Chief Operating Officer and Director
                              (Principal Accounting and Financial Officer)


                                       34