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

                                   FORM 10-KSB
                                   -----------

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

                    For the fiscal year ended: July 31, 2005

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

               For the transition period from ________ to ________

                        Commission file number: 000-29475

                                     RUDY 45
                                     -------
                 (Name of small business issuer in its charter)

                 NEVADA                                   88-0491630
   -------------------------------                    -------------------
   (State or other jurisdiction of                     (I.R.S. Employer
    incorporation or organization)                    Identification No.)


2633 Lincoln Boulevard, Suite 117, Santa Monica, California         90405-4656
-----------------------------------------------------------         ----------
       (Address of principal executive offices)                     (Zip Code)


Issuer's telephone number:  (310) 452-3206


                          Formerly Known as PHC Holdings
                         -------------------------------
                 (Name of small business issuer in its charter)


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

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


                         Common Stock, par value $0.001
                         ------------------------------
                                (Title of class)

         Check whether the Issuer (1) filed all reports  required to be filed by
Section 13 or 15(d) of the  Exchange  Act during the past 12 months (or for such
shorter period that the  registrant was required to file such reports),  and (2)
has been subject to such filing requirements for the past 90 days. Yes [X];
No [ ]

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

The  registrant  did not report any  revenues for the fiscal year ended July 31,
2005.

Aggregate market value of the voting stock held by non-affiliates on November 3,
2005: $88,574

Shares  outstanding  of  each of the  registrant's  class  of  common  stock  on
September 25, 2005: 59,975

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

DOCUMENTS INCORPORATED BY REFERENCE.  None

<PAGE>

                                TABLE OF CONTENTS

                                                                            Page
PART I

    Item 1   Description of Business...........................................1

    Item 2   Description of Property...........................................5

    Item 3   Legal Proceedings.................................................6

    Item 4   Submission of Matters to a Vote of Security Holders...............6

PART II

    Item 5   Market for Common Equity and Related Shareholder Matters..........6

    Item 6   Management's Discussion and Analysis or Plan of Operation.........9

    Item 7   Financial Statements.............................................13

    Item 8   Changes in and Disagreements with Accountants on Accounting and
             Financial Disclosure.............................................14

    Item 8A  Controls and Procedures..........................................14

PART III

    Item 9   Directors, Executive Officers, Promoters and Control Persons:
             Compliance with Section 16(a) of the Exchange Act................15

    Item 10  Executive Compensation...........................................16

    Item 11  Security Ownership of Certain Beneficial Owners and Management
             and Related Stockholder Matter...................................17

    Item 12  Certain Relationships and Related Transactions...................18

    Item 13  Exhibits.........................................................18

    Item 14  Principal Accountant Fees and Services...........................18

                                       i

<PAGE>

                                     PART I

ITEM 1  DESCRIPTION OF BUSINESS.

Organization and Nature of Business

         Malahat Energy Corporation ("Malahat") is a Nevada corporation that was
formed on July 26, 1994. Malahat operated a development stage enterprise and was
engaged in the  development of BioFuel systems to convert organic waste material
into an economical,  synthesized  fuel gas for energy  consumption.  The Company
completed a reverse merger with a publicly  traded  "Shell"  company in May 2001
and traded was quoted on the Over the  Counter  Bulletin  Board under the symbol
"MAHT".

         On August 30, 2004,  Malahat's  board of  directors  approved a plan of
reorganization  pursuant to which Malahat  transferred  substantially all of its
assets  and  substantially  all of its  liabilities  except for  liabilities  of
approximately  $70,000 to its wholly owned  subsidiary,  MSC. In connection with
the plan of  reorganization  all of MSC outstanding stock was distributed to the
Company's existing stockholder.

         On August 30, 2004 and in connection  with a stock purchase  agreement,
shareholders  owning  10,581,875  shares which  represented 66% of the Company's
outstanding  stock agreed to sell their shares to new  investors  for $85,000 in
cash.  In connection  with  foregoing,  the officers and  directors  resigned on
August  30,  2004  and  representatives  of  the  new  investors  assumed  those
positions.

         On December 22, 2004,  Malahat  changed its name to PHC Holdings and on
December 23, 2004, PHC Holdings elected to become a Business Development Company
("BDC") under the  Investment  Company Act of 1940, as amended (the "1940 Act").
The  Company was quoted on the "pink  sheets"  under the name PHC  Holdings  and
under the symbol "PHCD."

         Subsequent  to the name change and  electing to be a BDC,  PHC Holdings
will be continuously  seeking operating private profitable  entities in which to
invest in and offer  management  skills.  A BDC is defined and  regulated by the
Investment  Company Act of 1940 ("1940  Act").  A BDC must be  organized  in the
United  States for the purpose of investing  in or lending to primarily  private
companies  and making  managerial  assistance  available  to them. A BDC may use
capital  provided  by public  shareholders  and from other  sources to invest in
long-term,  private investments in businesses.  A BDC provides  shareholders the
ability to retain the liquidity of a publicly traded stock, while sharing in the
possible benefits, if any, of investing in primarily privately owned companies.

         On September 12, 2005,  the board of directors  received  authorization
from the  shareholders  to amend the  articles of  incorporation  for Article 1,
Company  Name;  changing our name from PHC Holdings to Rudy 45 (the  "Company");
and to implement a 1450:1 reverse stock split of the Company's common stock; and
a new trading  symbol of  "RDYF.PK";  all  effective  September  26,  2005.  The
Company's  shareholders record reflects 86,963,750 issued and outstanding shares
before the reverse stock split and will reflect  59,975  issued and  outstanding
shares after the reverse stock split.

Business Development Company

         The  Company  intends to invest in  companies  that focus on  providing
marketing  and  promotional  services.  We will seek to  leverage  the  combined
talents of our  experienced  management team to invest in those companies and to
enhance shareholder value.

         A business  development company ("BDC") is defined and regulated by the
Investment Company Act of 1940 (the "1940 Act"). A business  development company
must be  organized  in the United  States for the  purpose  of  investing  in or
lending  to  primarily  private  companies  and  making  managerial   assistance
available to them. A business  development  company may use capital  provided by
public  shareholders  and from  other  sources to invest in  long-term,  private
investments in businesses.  A business development company provides shareholders
the ability to retain the liquidity of a publicly traded stock, while sharing in
the  possible  benefits,  if any, of  investing  in  primarily  privately  owned
companies.

                                       1

<PAGE>

         As a business  development  company, we may not acquire any asset other
than "qualifying assets" unless, at the time we make the acquisition,  the value
of our  qualifying  assets  represent  at least  70% of the  value of our  total
assets.  The principal  categories of qualifying assets relevant to our business
are:

         o  Securities  purchased  in  transactions  not  involving  any  public
            offering, the issuer of which is an eligible portfolio company;

         o  Securities  received in exchange for or distributed  with respect to
            securities described in the bullet above or pursuant to the exercise
            of options, warrants or rights relating to such securities; and

         o  Cash,  cash  items,  government  securities  or  high  quality  debt
            securities  (within  the  meaning of the 1940 Act),  maturing in one
            year or less from the time of investment.

An eligible  portfolio  company is  generally a domestic  company that is not an
investment company (other than a small business  investment company wholly owned
by a business development company); and

         o  Does not have a class of  securities  registered on an exchange or a
            class of securities with respect to which a broker may extend margin
            credit;

         o  Is actively  controlled by the business  development company and has
            an  affiliate  of a  business  development  company  on its board of
            directors.

         To include certain securities  described above as qualifying assets for
the purpose of the 70% test, a business  development company must make available
to the issuer of those  securities  significant  managerial  assistance  such as
providing   significant   guidance  and  counsel   concerning  the   management,
operations, or business objectives and policies of a portfolio company or making
loans to a portfolio company. We offer to provide managerial  assistance to each
of our portfolio companies.

         As a business  development  company,  we are  entitled to issue  senior
securities in the form of stock or senior securities representing  indebtedness,
including debt  securities and preferred  stock, as long as each class of senior
security  has  asset  coverage  of at least  200%  immediately  after  each such
issuance.

         We  may  also  be  prohibited   under  the  1940  Act  from   knowingly
participating  in certain  transactions  with our  affiliates  without the prior
approval of our board of directors who are not  interested  persons and, in some
cases, prior approval by the SEC.

         We are  periodically  examined by the SEC for compliance  with the 1940
Act. As with other companies  regulated by the 1940 Act, a business  development
company must adhere to certain substantive regulatory  requirements.  A majority
of our directors must be persons who are not interested persons, as that term is
defined in the 1940 Act. Additionally, we are required to provide and maintain a
bond  issued by a  reputable  fidelity  insurance  company to protect us against
larceny and embezzlement. Furthermore, as a business development company, we are
prohibited  from protecting any director or officer against any liability to the
Company or our shareholders  arising from wilful  malfeasance,  bad faith, gross
negligence or reckless  disregard of the duties  involved in the conduct of such
person's office.

         We maintain a code of ethics that  establishes  procedures for personal
investment and restricts  certain  transactions  by our  personnel.  Our code of
ethics generally does not permit  investment by our employees in securities that
may be purchased or held by us. The code of ethics is filed as an exhibit to our
registration  statement,  which is on file at the SEC. You may read and copy the
code of ethics at the SEC's Public  Reference Room in  Washington,  D.C. You may
obtain information on operations of the Public Reference Room by calling the SEC
at (202)  942-8090.  In  addition,  the code of ethics is available on the EDGAR
Database on the SEC Internet site at  http://www.sec.gov.  You may obtain copies
of the code of ethics,  after paying a duplicating fee, by electronic request at
the  following  email  address:  publicinfo@sec.gov,  or by writing to the SEC's
Public  Reference  Section,  450 5th Street,  NW,  Washington,  D.C. 20549. As a
business  development  company  under the 1940 Act,  we are  entitled to provide
loans to our employees in connection with the exercise of options. However, as a
result of provisions of the  Sarbanes-Oxley  Act of 2002, we are prohibited from
making new loans to, or materially  modifying existing loans with, our executive
officers in the future.

         We may not change the nature of our  business  so as to cease to be, or
withdraw our election as, a business  development  company unless  authorized by
vote of a "majority of the  outstanding  voting  securities,"  as defined in the
1940 Act, of our shares.  A majority of the outstanding  voting  securities of a
company is defined  under the 1940 Act as the lesser of: (i) 67% or more of such
company's shares present at a meeting if more than 50% of the outstanding shares
of such  company are present and  represented  by proxy or (ii) more than 50% of
the outstanding shares of such company.  Since we made our business  development
company election,  we have not made any substantial  change in the nature of our
business.

                                       2

<PAGE>

         We fund new investments using cash,  through the issuance of our common
equity, the reinvestment of previously accrued interest and dividends in debt or
equity securities,  or the current  reinvestment of interest and dividend income
through the receipt of a debt or equity security  (payment-in-kind income). From
time to time, we may also opt to reinvest accrued  interest  receivable in a new
debt or equity.

Valuation Methodology

         We  determine  the  value  of each  investment  in our  portfolio  on a
quarterly basis, and changes in value result in unrealized gains or losses being
recognized. At July 31, 2005 we have no portfolio investments,  consequently our
total assets did not  represent  portfolio  investments  recorded at fair value.
Value, as defined in Section 2(a)(41) of the Investment  Company Act of 1940, is
(i) the  market  price for those  securities  for  which a market  quotation  is
readily available and (ii) for all other securities and assets, fair value is as
determined in good faith by the board of directors.  Since there is typically no
readily  ascertainable  market value for the  investments in our  portfolio,  we
value substantially all of our portfolio investments at fair value as determined
in good faith by the board of  directors  pursuant to a  valuation  policy and a
consistently  applied valuation process.  Because of the inherent uncertainty of
determining  the  fair  value  of  investments   that  do  not  have  a  readily
ascertainable market value, the fair value of our investments determined in good
faith by the board of directors  may differ  significantly  from the values that
would have been used had a ready  market  existed for the  investments,  and the
differences could be material.

         There is no single standard for  determining  fair value in good faith.
As a result,  determining  fair value  requires  that judgment be applied to the
specific facts and circumstances of each portfolio  investment while employing a
consistently  applied  valuation  process for the types of  investments we make.
Unlike banks,  we are not permitted to provide a general reserve for anticipated
loan losses.  Instead,  we are required to  specifically  value each  individual
investment  on a quarterly  basis.  We will record  unrealized  depreciation  on
investments  when we believe that an investment has become  impaired,  including
where collection of a loan or realization of an equity security is doubtful,  or
when the enterprise value of the company does not currently  support the cost of
our  debt  or  equity   investment.   Conversely,   we  will  record  unrealized
appreciation if we believe that the underlying portfolio company has appreciated
in value and,  therefore,  our equity  security has also  appreciated  in value.
Changes in fair value are recorded in the  statements  of  operations as "Gain /
Loss on investments in portfolio companies."

         As a  business  development  company,  we  plan  to  invest  in  liquid
securities  including debt and equity securities of primarily private companies.
The  structure  of  each  private  finance  debt  and  equity  security  will be
specifically  negotiated to enable us to protect our investment and maximize our
returns.  We include  many  terms  governing  interest  rate,  repayment  terms,
prepayment  penalties,   financial  covenants,  operating  covenants,  ownership
parameters, dilution parameters, liquidation preferences, voting rights, and put
or call rights.  Our  investments  may generally be subject to  restrictions  on
resale and generally have no established trading market.  Because of the type of
investments that we expect to make and the nature of our business, our valuation
process requires an analysis of various factors.  Our fair value  methodology is
expected to include the  examination  of,  among other  things,  the  underlying
investment  performance,  financial  condition and market  changing  events that
impact valuation.

Private Finance

         Our  process  for  determining  the  fair  value of a  private  finance
investment  begins  with  determining  the  enterprise  value  of the  portfolio
company.  The fair value of our investment is based on the  enterprise  value at
which the  portfolio  company  could be sold in an  orderly  disposition  over a
reasonable  period of time  between  willing  parties  other than in a forced or
liquidation  sale.  The  liquidity  event  whereby  we  exit a  private  finance
investment is generally the sale, the  recapitalization  or, in some cases,  the
initial public offering of the portfolio company.

         There is no one methodology to determine enterprise value and, in fact,
for any one-portfolio company,  enterprise value is best expressed as a range of
fair values,  from which we derive a single  estimate of  enterprise  value.  To
determine the enterprise value of a portfolio company, we analyze its historical
and projected  financial  results.  We generally require portfolio  companies to
provide annual audited and monthly unaudited  financial  statements,  as well as
annual projections for the upcoming fiscal year. Typically in the private equity
business,  companies  are bought and sold based upon  multiples of EBITDA,  cash
flows, net income,  revenues or, in limited  instances,  book value. The private
equity  industry  uses  financial  measures  such as EBITDA or EBITAM  (Earnings
Before  Interest,  Taxes,  Depreciation,  Amortization  and, in some  instances,
Management fees) in order to assess a portfolio company's financial  performance
and to  value a  portfolio  company.  EBITDA  and  EBITAM  are not  intended  to
represent  cash  flow  from  operations  as  defined  by  accounting  principles
generally  accepted in the United States of America and such information  should
not be considered as an alternative to net income, cash flow from operations, or
any other measure of performance  prescribed by accounting  principles generally
accepted  in the  United  States of  America.  When  using  EBITDA to  determine
enterprise value, we may adjust EBITDA for non-recurring items. Such adjustments
are

                                       3

<PAGE>

intended to normalize EBITDA to reflect the portfolio  company's earnings power.
Adjustments to EBITDA may include compensation to previous owners,  acquisition,
recapitalization,  or  restructuring  related  items or  one-time  non-recurring
income or expense items.

         In  determining  a multiple to use for valuation  purposes,  we look to
private merger and acquisition statistics, discounted publicly trading multiples
or industry practices. In estimating a reasonable multiple, we consider not only
the fact that our portfolio  company may be a private company relative to a peer
group of  public  comparables,  but we also  consider  the size and scope of our
portfolio company and its specific strengths and weaknesses.  In some cases, the
best  valuation  methodology  may be a discounted  cash flow  analysis  based on
future projections. If a portfolio company is distressed, a liquidation analysis
may provide the best indication of enterprise value.

Code of Ethics, Audit Committee Charter and Investment Committee Charter

         The board of  directors  of the Company  adopted a Code of Ethics,  and
Audit Committee Charter and an Investment Committee Charter, all effective as of
December 22, 2004.

         The Code of  Ethics in  general  prohibits  any  officer,  director  or
advisory person  (collectively,  "Access  Person") of the Company from acquiring
any interest in any security  which the Company (i) is considering a purchase or
sale thereof,  (ii) is being purchased or sold by the Company, or (iii) is being
sold short by the Company.  The Access  Person is required to advise the Company
in writing of his or her acquisition or sale of any such security.

         The primary  responsibility  of the Audit  Committee  is to oversee the
Company's  financial  reporting  process  on  behalf of the  Company's  Board of
Directors  and  report  the  result  of  their  activities  to the  Board.  Such
responsibilities  shall include, but shall not be limited to, the selection and,
if necessary,  the replacement of the Company's  independent auditors and review
and discussion with such independent auditors of (i) the overall scope and plans
for the  audit,  (ii) the  adequacy  and  effectiveness  of the  accounting  and
financial  controls,  including  the  Company's  system to  monitor  and  manage
business  risks,  and legal and ethical  programs,  and (iii) the results of the
annual audit, including the financial statements to be included in the Company's
annual report on Form 10-KSB for the year ended July 31, 2005.  The entire board
of directors have been designated the Audit Committee's "financial expert".

         The  Investment  Committee  shall have  oversight  responsibility  with
respect to reviewing and overseeing the Company's  contemplated  investments and
portfolio  companies and investments on behalf of the Board and shall report the
results of their  activities to the Board.  Such Investment  Committee shall (i)
have the ultimate  authority  for and  responsibility  to evaluate and recommend
investments,  and (ii) review and discuss with management (a) the performance of
portfolio  companies,  (b) the diversity  and risk of the  Company's  investment
portfolio, and, where appropriate,  make recommendations  respecting the role or
addition of portfolio  investments and (c) all solicited and unsolicited  offers
to purchase portfolio companies.

         The members of the Audit  Committee  and the  Investment  Committee are
currently the entire board of directors of the Company.

Risk Factors

         Investing  in the  Company  involves  a  number  of  significant  risks
relating to our business and investment objective.  As a result, there can be no
assurance that we will achieve our investment objective. In addition to the risk
factors described below, other factors that could cause actual results to differ
materially include:

         o  Our limited operating history as a BDC;

         o  Risks  associated  with  our  compliance  with  Section  404  of the
            Sarbanes-Oxley Act;

         o  The ongoing global economic downturn, coupled with war or the threat
            of war;

         o  Risk  associated  with possible  disruption in our operations due to
            terrorism;

         o  Future regulatory actions and conditions in our operating areas; and

         o  Other risks and  uncertainties  as may be detailed from time to time
            in our public announcements and SEC filings.

                                       4

<PAGE>

Investing in private companies involves a high degree of risk.

Our portfolio may consist  primarily of long-term  loans to and  investments  in
private  companies.  Investments in private  businesses involve a high degree of
business  and  financial  risk,  which can  result  in  substantial  losses  and
accordingly  should be  considered  speculative.  There is generally no publicly
available  information  about  the  companies  in which we  invest,  and we rely
significantly on the diligence of our employees and agents to obtain information
in  connection  with  our  investment  decisions.   In  addition,  some  smaller
businesses have narrower product lines and market shares than their competition,
and may be  more  vulnerable  to  customer  preferences,  market  conditions  or
economic  downturns,  which may adversely  affect the return on, or the recovery
of, our investment in such businesses.

Our common stock price may be volatile.

         The trading price of our common stock may fluctuate substantially.  The
price of the common stock may be higher or lower than the price you pay for your
shares,  depending on many factors, some of which are beyond our control and may
not be directly related to our operating performance.  These factors include the
following:

         o  Price and volume  fluctuations in the overall stock market from time
            to time;

         o  Significant  volatility  in the market  price and trading  volume of
            securities  of business  development  companies  or other  financial
            services companies;

         o  Volatility  resulting from trading in derivative  securities related
            to  our  common  stock  including  puts,  calls,   long-term  equity
            anticipation securities, or LEAPs, or short trading positions;

         o  Changes in  regulatory  policies or tax  guidelines  with respect to
            business development companies or regulated investment companies;

         o  Actual or anticipated changes in our earnings or fluctuations in our
            operating  results  or  changes in the  expectations  of  securities
            analysts;

         o  General  economic  conditions and trends;

         o  Loss of a major funding source; or

         o  Departures of key personnel.

         Recently,  the trading price of our common stock has been volatile. Due
to the continued  potential  volatility of our stock price, we may be the target
of securities  litigation in the future.  Securities  litigation could result in
substantial  costs and divert  management's  attention  and  resources  from our
business.

Reverse Stock Split

         On September 12, 2005,  the board of directors  received  authorization
from the  shareholders  to amend the  articles of  incorporation  for Article 1,
Company Name;  changing the Company's name to Rudy 45; and to implement a 1450:1
reverse stock split of the Company's  common stock;  and a new trading symbol of
RDYF.PK;  all effective  September 26, 2005. The Company's  shareholders  record
reflects 86,963,750 issued and outstanding shares before the reverse stock split
and will reflect  59,975 issued and  outstanding  shares after the reverse stock
split.

Employees

         At July 31, 2005, the Company had 2 employees.

ITEM 2   DESCRIPTION OF PROPERTY.

         The Company's offices are located at 2633 Lincoln Boulevard, Suite 117,
Santa Monica,  California  90405.  It occupies these premises under a lease on a
month-to-month basis. The monthly rental on this space is $50.00 per month.

         Within the next twelve months, the Company believes that it may need to
lease 1,000 square feet of office  space to  accommodate  anticipated  long-term
expansion plans upon its investment in private entities.

                                       5

<PAGE>

ITEM 3   LEGAL PROCEEDINGS.

         Currently, the Company is not a party to any pending legal proceedings.

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

         On December 22, 2004, it was approved by  shareholders to amend Article
I, Name of Company; the Company changed its name to PHC Holdings, and elected to
become a Business  Development Company or "BDC" under the Investment Company Act
of 1940,  as  amended  (the "1940  Act").  The  Company  was quoted on the "pink
sheets" under the name PHC Holdings and under the symbol  "PHCD." The Company is
now quoted  under the name Rudy 45 and under the  symbol  "RDYF."  Also,  it was
approved  by  shareholders  to  amend  Article  IV,  Authorized  Capital  Stock;
increasing its authorized  common stock to 500,000,000  shares,  each with a par
value of $0.001 per share;  and  increasing its  authorized  preferred  stock to
25,000,000  shares,  each with a par value of $0.001 per share, with the rights,
preferences,  privileges  and  restrictions  granted  to  or  imposed  upon  the
preferred stock to be determined by the board of directors.

         On August 10, 2005,  it was approved by  shareholders  to amend Article
IV,  Authorized  Capital  Stock,  of the  Company's  Articles of  Incorporation,
increasing the total authorized common stock to 950,000,000  shares, each with a
par  value of  $0.001  per  share  ("Common  Stock")  and  50,000,000  shares of
Preferred  Stock  each  with a par value of  $0.001,  ("Preferred  Stock").  The
rights, preferences,  privileges and restrictions granted to or imposed upon the
Preferred Stock will be determined by the Board of Directors. This amendment was
approved  by  the  required  vote  of   shareholders   in  accordance  with  the
corporation's law of the state of Nevada.

         On September 12, 2005,  the board of directors  received  authorization
from the  shareholders  to amend the  articles of  incorporation  for Article 1,
Company Name;  changing the Company's name to Rudy 45; and to implement a 1450:1
reverse stock split of the Company's common stock effective  September 26, 2005.
The Company's  shareholders  record reflects on such date 86,963,207  issued and
outstanding  shares  before the reverse stock split and 59,975 after the reverse
stock split.

ITEM 5 MARKET  FOR  COMMN  EQUITY  AND  RELATED  SHAREHOLDER  MATTERS  AND SMALL
BUSINESS ISSUES PURCHASES OF EQUITY SECURITIES

         The  Company's  common stock is quoted on the National  Association  of
Securities  Dealers,  Inc. PINK SHEETS under the symbol "RDFY" and is not listed
for trading on any  exchange.  The PINK  SHEETS,  which is separate and distinct
from the NASDAQ Stock Market, is a quotation service for subscribing members and
is  regulated  by the  Securities  and  Exchange  Commission  and  the  National
Association  of  Securities  Dealers,  Inc.,  or NASDAQ,  PINK  SHEETS,  and OTC
Bulletin Board  securities are traded by a community of market makers that enter
quotes and trade reports through a closed computer network.

                                       6

<PAGE>

         The Company's  common stock began trading on the OTC Bulletin  Board on
May 30,  2001  under the symbol  "MAHT".  Prior to this  date,  the  predecessor
pre-merge  public entity Granada  Mineral  Products Inc. traded under the symbol
"GDMN".  Set forth below are the high and low closing bid and asking  prices for
its common stock by quarter,  from January 2, 2002 through  September  30, 2005.
The common stock began to trade in the PINK SHEETS in January  2004.  Commencing
December 24, 2004,  the stock began trading under the symbol  "PHCD",  which was
subsequently changed to "RDYF." The quotations listed below reflect inter-dealer
prices, without retail mark-up,  mark-down or commission,  and may not represent
transactions.

                                   CLOSING BID           CLOSING ASK
                                  HIGH      LOW         HIGH      LOW
                                  ----      ---         ----      ---
                       2003
                       ----
         JAN. 1 THRU MAR. 31      .04      .021         .07       .03
           APR 1THRU JUN. 30      .07      .01          .078      .014
          JUL 1 THRU SEP. 30      .06      .035         .07       .05
         OCT. 1 THRU DEC. 31      .045     .03          .09       .04

                       2004
                       ----
         JAN. 1 THRU MAR. 31      .06      .03          .10       .05
           APR 1 THRU JUN 30      .055     .03          .065      .035
           JUL 1 THRU SEP 30      .025     .02          .04       .025
           OCT 1 THRU DEC 31      .03      .02          .05       .03

                       2005
                       ----
          JAN. 3 THRU MAR 31      .60      .03          .69       .05
           APR 1 THRU JUN 30      .10      .0225        .135      .03
             JUL THRU SEP 23      .025     .0013        .035      .0025
         *SEP 23 THRU SEP 30     1.50     1.50        14.00      3.50
*(1 for 1,450 reverse split)

         On September 12, 2005,  the board of directors  received  authorization
from the  shareholders  to amend the  articles of  incorporation  for Article 1,
Company Name;  changing the Company's name to Rudy 45; and to implement a 1450:1
reverse stock split of the Company's common stock effective  September 26, 2005.
The Company's  shareholders  record reflects on such date 86,963,207  issued and
outstanding  shares  before the reverse stock split and 59,975 after the reverse
stock split.

Number of Shareholders

         As of July 31, 2005, the Company had  68,243,207  shares (47,064 shares
giving effect to the reverse stock split) of its common stock outstanding,  held
of record by approximately 122 shareholders. Within the holders of record of its
common stock are depositories, such as Cede & Co., that hold shares of stock for
brokerage firms which, in turn, hold shares of stock for beneficial owners.

         As of September 26, 2005,  the Company had  86,963,207  shares  (59,975
shares   giving  effect  to  the  reverse  stock  split)  of  its  common  stock
outstanding,  held of record  by  approximately  140  shareholders.  Within  the
holders of record of its common stock are depositories, such as Cede & Co., that
hold shares of stock for brokerage  firms which,  in turn,  hold shares of stock
for beneficial owners.

Dividend Policy

         The Company has never declared or paid any cash dividends on its common
stock and do not expect to declare or pay any cash  dividend in the  foreseeable
future. It currently intends to retain all future earnings,  if any, to fund the
development and growth of the Company. Any future payment of dividends,  if any,
will be at the  discretion  of the board of  directors  and will depend upon its
future earnings,  capital  requirements,  financial condition,  general business
conditions and other factors deemed relevant by its board of directors.

                                       7

<PAGE>

Penny Stock

         Until the Company's  shares qualify for inclusion in the NASDAQ system,
the public trading,  if any, of the Company's  Common Stock will be on the "Pink
Sheets" or on the OTC Bulletin Board. As a result,  an investor may find it more
difficult to dispose of, or to obtain  accurate  quotations as to the price,  of
the  Common  Stock  offered.  The  Company's  Common  Stock  is  subject  to the
provisions  of Section 15(g) and Rule 15(g)9 of the  Securities  Exchange Act of
1934, as amended (the "Exchange Act"),  commonly referred to as the "penny stock
rule." Section 15(g) sets forth certain  requirements  for transactions in penny
stocks,  and Rule 15g-9(d) (1) incorporates the definition of "penny stock" that
is found in Rule 3a51-1 of the Exchange  Act. The SEC generally  defines  "penny
stock" to be an equity  security  that has a market  price  less than  $5.00 per
share, subject to certain exceptions. If the Company's Common Stock is deemed to
be a penny  stock,  trading in the shares  will be subject to  additional  sales
practice  requirements on broker-dealers  who sell penny stocks to persons other
than established customers and accredited investors.  "Accredited investors" are
persons with assets in excess of $1,000,000 or annual income exceeding $200,000,
or $300,000 together with their spouse. For transactions covered by these rules,
broker-dealers must make a special suitability determination for the purchase of
such security and must have the  purchaser's  written consent to the transaction
prior to the  purchase.  Additionally,  for any  transaction  involving  a penny
stock,  unless  exempt,  the  rules  require  the  delivery,  prior to the first
transaction, of a risk disclosure document, prepared by the SEC, relating to the
penny stock market. A broker-dealer  also must disclose the commissions  payable
to  both  the  broker-dealer  and the  registered  representative,  and  current
quotations  for  the  securities.  Finally,  monthly  statements  must  be  sent
disclosing  recent price information for the penny stocks held in an account and
information on the limited market in penny stocks. Consequently, these rules may
restrict the ability of  broker-dealers to trade and/or maintain a market in the
Company's Common Stock and may affect the ability of the Company's  shareholders
to sell their shares.

Recent Sales of Unregistered Securities

Preferred Stock

         The Company is  authorized  effective  December 22, 2004 to issue up to
25,000,000  shares of  preferred  stock at $0.001  par value,  with all  rights,
preferences,  privileges  and  restrictions  granted  to  or  imposed  upon  the
preferred  stock to be  determined  by the board of  directors.  The  authorized
number of preferred shares was increased to 50,000,000 on August 10, 2005.

Common Stock

         The Company is  authorized  effective  December 22, 2004 to issue up to
500,000,000 shares of common stock at $0.001 par value. The authorized number of
preferred  shares was increased to  950,000,000 on August 10, 2005. On September
12, 2005, the Company  implemented a 1450:1  reverse stock split.  The Company's
records  reflect on such date 86,963,207  issued and  outstanding  common shares
before the reverse  stock split and 59,975 common shares after the reverse stock
split.  Accordingly,  during the year ended July 31,  2005,  the Company  issued
52,236,330  common  shares  (representing  36,025  shares  giving  effect to the
reverse stock split declared September 2005), as discussed below.

         On December 15, 2004,  the Company  issued  6,425,000  shares of common
stock (4,431  shares  giving  effect to the reverse stock split) in exchange for
services  provided by certain  consultants.  Such shares were valued at $393,210
(estimated to be the fair value based on private placement sales on or about the
issuance date). The transaction  described in this paragraph  constituted exempt
offerings under Section 4(2) of the Securities Act.

         On January 27, 2005, the Company entered into an agreement  pursuant to
which we sold 1,100,000  shares of our common stock (759 shares giving effect to
the reverse  stock split) for an aggregate  purchase  price of  $1,100,000.  The
transaction described in this paragraph constituted exempt offerings provided by
Rule 602(a) of Regulation E under the 33 Act.

         During the quarter  ended,  April 30,  2005,  the Company  entered into
agreements  pursuant to which we sold  1,750,000  shares of common  stock (1,207
shares giving effect to the reverse stock split) for an aggregate of $124,000 in
proceeds.  The  transactions  described  in this  paragraph  constituted  exempt
offerings provided by Rule 602(a) of Regulation E under the 33 Act.

         During the quarter ended,  April 30, 2005, the Company issued 3,155,000
shares of common stock (2,176  shares  giving effect to the reverse stock split)
in  exchange  for  services  provided by certain  consultants.  Such shares were
valued at $182,845  (estimated  to be the fair value based on private  placement
sales  on or  about  the  issuance  date).  The  transaction  described  in this
paragraph constituted exempt offerings under Section 4(2) of the Securities Act.

                                       8

<PAGE>

         During the quarter  ended,  July 31,  2005,  the Company  entered  into
agreements  pursuant to which we sold 33,150,000  shares of common stock (22,862
shares giving effect to the reverse stock split) for an aggregate of $403,250 in
proceeds.  The  transactions  described  in this  paragraph  constituted  exempt
offerings provided by Rule 602(a) of Regulation E under the 33 Act.

         During the quarter ended,  July 31, 2005, the Company issued  6,656,330
shares of common stock (4,591  shares  giving effect to the reverse stock split)
in  exchange  for  services  provided by certain  consultants.  Such shares were
valued at $222,101  (estimated  to be the fair value based on private  placement
sales  on or  about  the  issuance  date).  The  transaction  described  in this
paragraph constituted exempt offerings under Section 4(2) of the Securities Act.

ITEM 6  MANAGEMENT'S  DISCUSSION  AND  ANALYSIS OF FINANCIAL  CONDITIONS OR PLAN
        OF OPERATIONS

Forward-Looking Statements

         Historical  results and trends  should not be taken as an indication of
future operations. Management's statements contained in this report that are not
historical facts are  forward-looking  statements  within the meaning of Section
27A of the  Securities  Act and Section 21E of the  Securities  Exchange  Act of
1934, as amended (the "Exchange Act"). Actual results may differ materially from
those  included in the  forward-looking  statements.  The Company  intends  such
forward-looking  statements  to be covered  by the  safe-harbor  provisions  for
forward-looking statements contained in the Private Securities Litigation Reform
Act of 1995,  and is including  this  statement  for purposes of complying  with
those safe-harbor  provisions.  Forward-looking  statements,  which are based on
certain  assumptions and describe future plans,  strategies and  expectations of
the Company, are generally identifiable by use of the words "believe," "expect,"
"anticipate,"  "estimate," "project,"  "prospects," or similar expressions.  The
Company's  ability to predict  results or the actual  effect of future  plans or
strategies is inherently uncertain.  Factors which could have a material adverse
affect on the operations  and future  prospects of the Company on a consolidated
basis include,  but are not limited to: changes in economic conditions generally
in the United  States of America  and the other  countries  in which the Company
operates,  legislative/regulatory  changes, the political climate in the foreign
countries in which the Company operates,  the availability of capital,  interest
rates,  competition,  and generally accepted accounting principles.  These risks
and uncertainties should be considered in evaluating  forward-looking statements
and undue reliance should not be placed on such statements.  Further information
concerning the Company and its business; including additional factors that could
materially affect the Company's  financial  results,  are included herein and in
the Company's other filings with the Securities and Exchange Commission.

         The following  discussion  and analysis  should be read in  conjunction
with the  financial  statements  and  notes  to  financial  statements  included
elsewhere in this annual  report on Form 10-KSB.  This report and the  financial
statements and notes to financial statements contain forward-looking statements,
which  generally  include  the plans and  objectives  of  management  for future
operations,   including  plans  and  objectives   relating  to  future  economic
performance and our current beliefs  regarding  revenues we might earn if we are
successful  in  implementing  our  business  strategies.  The  Company  does not
undertake to update, revise or correct any forward-looking statements.

Results of Operations

         For the year ended July 31,  2005,  the Company  incurred a net loss of
$1,230,644. The Company had no revenues and expended approximately $1,116,000 on
consulting  and  professional  fees and  approximately  $115,000  on general and
administrative expenses. For the year ended July 31, 2004 the Company incurred a
net loss of $4,845.  The increase in the Company's net loss during 2005 resulted
from expenditures associated with the reorganization of the Company and services
associated with the Company's  election as a BDC.  Comprehensive  income for the
year ended July 31, 2004  included  the effect of foreign  currency  translation
adjustment  No such  adjustment  was required at July 31, 2005 due to our August
30, 2004  reorganization (as discussed above) which eliminated our international
operations.  The loss per common share  (calculated  giving effect to the 1450:1
reverse stock split declared  September 2005) was $64.10 for the year ended July
31, 2005, as compared to $0.45 per share for the year ended July 31, 2004.

                                       9

<PAGE>

Liquidity and Capital Resources

Capital Resources

         As of July 31,  2005,  the  Company  had cash of  $26,884  and  working
capital of $8,284.

Liquidity

         Our operating  activities used $469,442 in cash in fiscal 2005. Our net
loss of  $1,230,644  was the primary  component of our negative  operating  cash
flow.  Included in such loss was the impact of our  issuance of common stock for
services totaling $798,156.  For fiscal 2004,  operating activities used $54,374
primarily due to the net loss of $4,845 and the reduction of accounts payable by
approximately $65,879; offset by accumulated depreciation of $3,284.

         Our investing  activities  used $6,023 for the purchase of property and
equipment in fiscal 2005. We purchased no fixed assets in fiscal 2004.

         Our  financing  activities  provided net proceeds  from the issuance of
common stock of $502,349 during the year ended July 31, 2005. The Company was in
the development  stage prior to its  reorganization  on August 30, 2004, and has
not  generated  any revenues  from  operations  and there is no assurance of any
future  revenues.  Further,  the Company  discontinued  all operations as of May
2003.  As  of  July  31,  2005,  the  Company  had   accumulated  a  deficit  of
$3,408,236and working capital of $8,284.

         We have limited or no prior history as a BDC. Further,  we will require
substantial  additional  funding for continuing BDC  administration,  compliance
requirements and the  implementation of the business plan as a BDC. There can be
no assurance that the Company will be able to obtain sufficient additional funds
when needed,  or that such funds,  if  available,  will be  obtainable  on terms
satisfactory to the Company.  These conditions,  among others, raise substantial
doubt  about  the  Company's  ability  to  continue  as  a  going  concern.  The
accompanying financial statements do not include any adjustments relating to the
recoverability  and  classification  of asset carrying amounts or the amount and
classification  of  liabilities  that  might  result  the  Company  be unable to
continue as a going concern.

         The  Company  intends to invest in  companies  that focus on  providing
marketing  and  promotional  services.  We will seek to  leverage  the  combined
talents of our  experienced  management team to invest in those companies and to
enhance shareholder value.

         A  business  development  company  is  defined  and  regulated  by  the
Investment Company Act of 1940 ("1940 Act"). A business development company must
be organized in the United  States for the purpose of investing in or lending to
primarily private companies and making managerial  assistance available to them.
A business  development  company may use capital provided by public shareholders
and  from  other  sources  to  invest  in  long-term,   private  investments  in
businesses.  A business development company provides shareholders the ability to
retain the liquidity of a publicly  traded stock,  while sharing in the possible
benefits, if any, of investing in primarily privately owned companies.

         The  Company  is  authorized  to  raise  up to  $5,000,000  in value of
securities  without  registration of said securities under the Securities Act of
1933; in reliance on the exemption provided by Rule 602(a) of Regulation E under
the 33 Act.  Through  July 31,  2005,  the  Company  has raised  $502,349 in net
proceeds against this limit.

         Failure to secure  additional  financing or to raise additional  equity
capital may result in the Company  depleting its available funds and not be able
to pay its obligations.  These  circumstances,  among others,  raise substantial
doubt  about  the  Company's  ability  to  continue  as  a  going  concern.  The
accompanying consolidated financial statements do not include any adjustments to
reflect the possible future effects on the  recoverability and classification of
assets or the amounts and classification of liabilities that may result from the
possible inability of the Company to continue as a going concern.

         There are no capital  expenditures  planned for the next twelve months,
other than the contemplated leasing of additional office space.

                                       10

<PAGE>

Critical Accounting Policies

Valuation of Investments

         We  determine  the  value  of each  investment  in our  portfolio  on a
quarterly basis, and changes in value result in unrealized gains or losses being
recognized.  At July 31, 2005, we have no portfolio  investments,  consequently,
our total assets did not represent portfolio investments recorded at fair value.
Value, as defined in Section 2(a)(41) of the Investment  Company Act of 1940, is
(i) the  market  price for those  securities  for  which a market  quotation  is
readily available and (ii) for all other securities and assets, fair value is as
determined in good faith by the board of directors.  Since there is typically no
readily  ascertainable  market value for the  investments in our  portfolio,  we
expect to value substantially all of our portfolio  investments at fair value as
determined  in good  faith by the board of  directors  pursuant  to a  valuation
policy and a consistently  applied  valuation  process.  Because of the inherent
uncertainty  of  determining  the fair value of  investments  that do not have a
readily ascertainable market value, the fair value of our investments determined
in good faith by the board of directors may differ significantly from the values
that would have been used had a ready market  existed for the  investments,  and
the differences could be material.

         There is no single standard for  determining  fair value in good faith.
As a result,  determining  fair value  requires  that judgment be applied to the
specific facts and circumstances of each portfolio  investment while employing a
consistently  applied  valuation  process for the types of  investments we make.
Unlike banks,  we are not permitted to provide a general reserve for anticipated
loan losses.  Instead,  we are required to  specifically  value each  individual
investment  on a quarterly  basis.  We will record  unrealized  depreciation  on
investments  when we believe that an investment has become  impaired,  including
where collection of a loan or realization of an equity security is doubtful,  or
when the enterprise value of the company does not currently  support the cost of
our  debt  or  equity   investment.   Conversely,   we  will  record  unrealized
appreciation if we believe that the underlying portfolio company has appreciated
in value and,  therefore,  our equity  security has also  appreciated  in value.
Changes in fair value are recorded in the  statements  of  operations as "Gain /
Loss on investments in portfolio companies."

Property and Equipment

         Property  and   equipment   are  stated  at  cost,   less   accumulated
depreciation and  amortization.  Deprecation is provided using the straight-line
method over the estimated  useful lives of the related  assets.  Maintenance and
repairs are expensed as incurred, and betterments are capitalized. Upon the sale
or retirement of  depreciable  assets,  the accounts are relieved of the related
costs and accumulated  depreciation,  and any resulting gain or loss is included
in operations.

Long-Lived Assets

         SFAS No. 144,  "Accounting for the Impairment of Long-Lived  Assets and
for  Long-Lived  Assets to be  Disposed  of." SFAS No. 144  addresses  financial
accounting  and reporting for the  impairment or disposal of long-lived  assets.
SFAS No. 144 requires that long-lived assets be reviewed for impairment whenever
events or changes in  circumstances  indicate that their carrying amount may not
be  recoverable.  If the cost basis of a  long-lived  asset is greater  than the
projected future undiscounted net cash flows from such asset, an impairment loss
is recognized.  Impairment  losses are calculated as the difference  between the
cost basis of an asset and its estimated fair value.

Income Taxes

         The Company  follows SFAS No. 109,  "Accounting  for Income  Taxes" for
recording the provision  for income taxes.  Deferred tax assets and  liabilities
are  computed  based upon the  difference  between  the  consolidated  financial
statement  and  income  tax basis of assets and  liabilities  using the  enacted
marginal tax rate  applicable when the related asset or liability is expected to
be realized or settled.  Deferred  income tax  expenses or benefits are based on
the  changes  in the asset or  liability  each  period.  If  available  evidence
suggests  that it is more  likely  than  not  that  some  portion  or all of the
deferred tax assets will not be realized,  a valuation  allowance is required to
reduce the  deferred tax assets to the amount that is more likely than not to be
realized.  Future  changes  in such  valuation  allowance  are  included  in the
provision for deferred income taxes in the period of change.

                                       11

<PAGE>

Recently Issued Accounting Pronouncements

         In January 2003,  the FASB issued FASB  Interpretation  ("FIN") No. 46,
"Consolidation of Variable Interest Entities,  an Interpretation of ARB 51." The
primary  objectives of FIN 46 are to provide guidance on the  identification  of
entities for which  control is achieved  through  means other than voting rights
(variable  interest  entities,  or ("VIEs") and how to determine  when and which
business enterprise should consolidate the VIE. This new model for consolidation
applies to an entity for which  either:  (1) the equity  investors  don't have a
controlling  financial  interest;  or (2)  the  equity  investment  at  risk  is
insufficient to finance that entity's  activities  without receiving  additional
subordinated  financial support from other parties. In addition, FIN 46 requires
that both the primary  beneficiary and all other  enterprises with a significant
variable interest in a VIE make additional  disclosures.  As amended in December
2003, the effective  dates of FIN 46 for public entities that are small business
issuers,   as  defined   ("SBIs"),   are  as  follows:   (a)  For  interests  in
special-purpose  entities  ("SPEs"):  periods ended after December 15, 2004. The
December  2003  amendment of FIN 46 also  includes  transition  provisions  that
govern  how  an  SBI  which  previously  adopted  the  pronouncement  (as it was
originally issued) must account for consolidated VIEs.  Management has concluded
that the  Company  does not have any VIEs and does not  believe FIN 46 will have
any significant effect on the Company's future financial statements.

         In  December  2004,  the  FASB  issued  SFAS  No.  123-R,  "Share-Based
Payment,"  which  requires that the  compensation  costs relating to share-based
payment  transactions  (including  the cost of all  employee  stock  options) be
recognized in the financial statements.  That cost will be measured based on the
estimated  fair value of the equity or liability  instruments  issued.  SFAS No.
123-R covers a wide range of  share-based  compensation  arrangements  including
share  options,   restricted  share  plans,   performance-based   awards,  share
appreciation  rights, and employee share purchase plans. SFAS No. 123-R replaces
SFAS No. 123,  and  supersedes  APB Opinion No. 25. Small  Business  Issuers are
required  to apply SFAS No.  123-R in the first  annual  reporting  period  that
begins after  December  15, 2005.  The adoption of SFAS 123-R is not expected to
have a material impact on the Company's financial statements.

         In December 2004, the FASB issued SFAS No. 153 ("SFAS 153"), "Exchanges
of No monetary  Assets,  an  Amendment  of APB Opinion  No. 29,  Accounting  for
Nonmonetary  Transactions."  The  amendments  made by SFAS 153 are  based on the
principle  that  exchanges of  nonmonetary  assets should be measured  using the
estimated  fair value of the assets  exchanged.  SFAS 153  eliminates the narrow
exception for nonmonetary  exchanges of similar  productive assets, and replaces
it with a broader exception for exchanges of nonmonetary assets that do not have
commercial substance.  A nonmonetary exchange has "commercial  substance" if the
future cash flows of the entity are expected to change significantly as a result
of the transaction. This pronouncement is effective for nonmonetary exchanges in
fiscal periods  beginning  after June 15, 2005. The adoption of SFAS 153 did not
have a material impact on the Company's financial statements.

         In May 2005,  the FASB  issued SFAS No.  154,  "Accounting  Changes and
Error  Corrections," which replaces APB Opinion No. 20 and FASB Statement No. 3.
This pronouncement applies to all voluntary changes in accounting principle, and
revises the requirements for accounting for and reporting a change in accounting
principle.  SFAS No. 154 requires  retrospective  application  to prior periods'
financial statements of a voluntary change in accounting principle, unless it is
impracticable  to do so. This  pronouncement  also requires that a change in the
method of depreciation, amortization, or depletion for long-lived, non-financial
assets be accounted for as a change in accounting estimate that is affected by a
change in  accounting  principle.  SFAS No. 154 retains many  provisions  of APB
Opinion 20 without  change,  including  those  related to  reporting a change in
accounting  estimate,  a change in the reporting  entity,  and  correction of an
error. The pronouncement also carries forward the provisions of SFAS No. 3 which
govern reporting  accounting changes in interim financial  statements.  SFAS No.
154 is effective for accounting changes and corrections of errors made in fiscal
years  beginning  after  December 15, 2005.  The  Statement  does not change the
transition provisions of any existing accounting pronouncements, including those
that are in a  transition  phase as of the  effective  date of SFAS No. 154. The
adoption  of SFAS  No.  154 did not  have a  material  impact  on the  Company's
financial statements.

         Other recent  accounting  pronouncements  issued by the FASB (including
its  Emerging  Issues  Task  Force),  the AICPA,  and the SEC did not or are not
believed by  management to have a material  impact on the  Company's  present or
future consolidated financial statements.

                                       12

<PAGE>

ITEM 7  FINANCIAL STATEMENTS

                          INDEX TO FINANCIAL STATEMENTS

Page

         Report of Independent Registered Public Accounting Firm.............F-1

         Balance Sheet.......................................................F-2

         Statements of Operations and Other Comprehensive Income (Loss)......F-3

         Statements of Stockholders' Equity (Deficit)........................F-4

         Statements of Cash Flows............................................F-5

         Notes to Financial Statements.......................................F-6

                                       13

<PAGE>

             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders
Rudy 45
(Formerly known as PHC Holdings)

We have audited the  accompanying  balance sheet of Rudy 45 (the  "Company"),  a
business development company, as of July 31, 2005, and the related statements of
operations and comprehensive  income (loss),  stockholders' equity (deficit) and
cash  flows for the  years  ended  July 31,  2005 and the  related  consolidated
statements of operations and comprehensive  income (loss),  stockholders' equity
(deficit)  and cash  flows for the year  ended July 31,  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  audits to  obtain  reasonable  assurance  about  whether  the
consolidated  financial statements are free of material  misstatement.  An audit
includes  examining,  on a test  basis,  evidence  supporting  the  amounts  and
disclosures in the  consolidated  financial  statements.  An audit also includes
assessing  the  accounting   principles  used  and   significant   estimates  by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion the financial statements referred to above present fairly, in all
material  respects,  the financial  position of Rudy 45 as of July 31, 2005, and
the results of its  operations  and cash flows for the years ended July 31, 2005
and the  consolidated  results of  operations  and cash flows for the year ended
July 31, 2004, in conformity with accounting  principles  generally  accepted in
the United States of America.

The  accompanying  financial  statements  have been  prepared  assuming that the
Company will continue as a going concern. As shown in the accompanying financial
statements, the Company has experienced significant losses with no revenues from
its principal  operations.  As discussed in Note 1 to the financial  statements,
the Company has limited or no prior history as a BDC and a significant amount of
additional   capital  will  be  required  for  continuing  BDC   administration,
compliance  requirements and the  implementation  of the business plan as a BDC.
There can be no  assurance  that the Company  will be able to obtain  sufficient
additional  funds  when  needed,  or that  such  funds,  if  available,  will be
obtainable on terms satisfactory to the Company. These conditions, among others,
raise  substantial  doubt  about the  Company's  ability to  continue as a going
concern.  Management's  plans regarding these matters are also described in Note
1. The accompanying financial statements do not include any adjustments relating
to the recoverability and classification of asset carrying amounts or the amount
and  classification  of  liabilities  that might result the Company be unable to
continue as a going concern.

/s/ Squar, Milner, Reehl & Williamson, LLP
------------------------------------------
November 4, 2005
Newport Beach, California

                                       F-1

<PAGE>
                                     RUDY 45
                         (FORMERLY KNOW AS PHC HOLDINGS)
                                  BALANCE SHEET
                                  July 31, 2005

                                     ASSETS

Current assets:
     Cash                                                           $    26,884
                                                                    -----------
Total current assets                                                     26,884
Property and equipment, net                                               6,023
                                                                    -----------
Total assets                                                        $    32,907
                                                                    ===========

                      LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
     Accounts payable and accrued liabilities                       $    18,600
     Due to related party                                                    --
                                                                    -----------
Total current liabilities                                                18,600
                                                                    -----------
Commitments and contingencies
Stockholders' equity:
     Preferred stock, $0.001 par value, 25,000,000 shares
       authorized, none issued or outstanding                                --
     Common stock, $0.001 par value, 500,000,000 shares
       authorized, 47,064 shares* issued and outstanding                     47
     Additional paid-in capital, net                                  3,422,496
     Accumulated deficit                                             (3,408,236)
                                                                    -----------
Total stockholders' equity                                               14,307
                                                                    -----------
Total liabilities and stockholders' equity                          $    32,907
                                                                    ===========

* Reflects effect of 1450:1 reverse stock split declared September 26, 2005.

              See accompanying notes to the financials statements.

                                      F-2
<PAGE>

                                     RUDY 45
                        (FORMERLY KNOWN AS PHC HOLDINGS)
                            STATEMENTS OF OPERATIONS
                      AND OTHER COMPREHENSIVE INCOME (LOSS)
                   FOR THE YEARS ENDED JULY 31, 2005 AND 2004

                                                                    Consolidated
                                                           2005         2004
                                                       -----------  -----------
Continuing operations:
Net sales                                              $        --  $        --
Cost of good sold                                               --           --
                                                       -----------  -----------
Gross profit                                                    --           --
Selling, general and administrative expenes              1,230,644           --
                                                       -----------  -----------
Operating loss                                          (1,230,644)          --
                                                       -----------  -----------
Other income (expense):
     Gain on forgiveness of accrued liabilities                 --           --
                                                       -----------  -----------
Total other (expense) income                                    --           --
                                                       -----------  -----------
Loss from continuing operations before income taxes     (1,230,644)          --
Income tax provision                                            --           --
                                                       -----------  -----------
Loss from continuing operations                         (1,230,644)          --
Discontinued operations:
     Loss from operations of discontinued segment, net          --       (4,845)
                                                       -----------  -----------
Net loss                                                (1,230,644)      (4,845)
     Foreign currency translation adjustments                   --       51,984
                                                       -----------  -----------
Other comprehensive (loss) income                      $(1,230,644) $    47,139
                                                       ===========  ===========
Income (loss) per common share (basic and diluted):
     Continuing operations                             $    (64.10) $        --
     Discontinued operations                                    --        (0.45)
                                                       ===========  ===========
     Net loss                                          $    (64.10) $     (0.45)
                                                       ===========  ===========
Weighted average common shares* outstanding:
     Basic                                                  19,198       10,856
                                                       ===========  ===========
     Diluted                                                19,198       10,856
                                                       ===========  ===========

* Reflects effect of 1450:1 reverse stock split declared September 26, 2005.

              See accompanying notes to the financials statements.

                                      F-3

<PAGE>

                                     RUDY 45
                         (FORMERLY KNOW AS PHC HOLDINGS)
                  STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
                   FOR THE YEARS ENDED JULY 31, 2005 AND 2004

<TABLE>
<CAPTION>
                                                   Additional         Common         Accumulated
                               Common Stock*         Paid-in          Stock          Comprehensive     Accumulated
                             Shares       Par        Capital        Subscribed       Income (Loss)       Deficit            Total
                             ------------------------------------------------------------------------------------------------------
<S>                          <C>         <C>       <C>                <C>              <C>            <C>               <C>
Balance, Aug 1, 2003         11,039      $ 11      $ 1,931,462        $ 8,800          $ (27,686)     $ (2,172,747)     $  (260,160)

Foreign currency
 translation adjustment                                                                   51,984                             51,984

Net loss                                                                                                    (4,845)          (4,845)
                             ------      ----      -----------        -------          ---------      ------------      -----------
Balance, Jul 31, 2004        11,039        11        1,931,462          8,800             24,298        (2,177,592)        (213,021)

Reorganization of
 Company                                               181,765                           (24,298)                           157,467

Collection of stock
 subscription                                            8,800         (8,800)                                                   --

Issuance of stock
 for services                11,060        11          798,145                                                              798,156

Shares issued
 for cash, net of
 placement fees              24,965        25          502,324                                                              502,349

Net loss                                                                                                (1,230,644)      (1,230,644)
                             ------      ----      -----------        -------          ---------      ------------      -----------
Balance, Jul 31, 2005        47,064      $ 47      $ 3,422,496        $    --          $      --      $ (3,408,236)     $    14,307
                             ======      ====      ===========        =======          =========      ============      ===========
</TABLE>

* Reflects effect of 1450:1 reverse stock split declared September 26, 2005.

              See accompanying notes to the financials statements.

                                      F-4

<PAGE>

                                     RUDY 45
                        (FORMERLY KNOWN AS PHC HOLDINGS)
                            STATEMENTS OF CASH FLOWS
                   FOR THE YEARS ENDED JULY 31, 2005 AND 2004

                                                        2005           2004
                                                    -----------    -----------
CASH FLOW FROM OPERATING ACTIVITIES:
     Net loss                                       $(1,230,644)   $        --
     Adjustments to reconcile net loss to net
     cash used in operating activities:
         Depreciation and amortization                       --             --
         Issuance of common stock for services          798,156             --
     Changes in operating assets and liabilities:
         Other assets                                        --             --
         Accounts payable and accrued liabilities       (36,954)            --
         Due to related party                                --             --
                                                    -----------    -----------
Net cash used in operating activities                  (469,442)            --
                                                    -----------    -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
     Purchase of property and equipment                  (6,023)            --
                                                    -----------    -----------
Net cash used in investing activities                    (6,023)            --
                                                    -----------    -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
     Proceeds from issuance of common stock, net        502,349             --
                                                    -----------    -----------
Net cash provided by financing activities               502,349             --
                                                    -----------    -----------
Foreign currency translation adjustment                      --             --
Net cash flows from discontinued operations                  --         (2,390)
                                                    -----------    -----------
Net increase in cash and cash equivalents                26,884         (2,390)
Cash at beginning of period                                  --          2,390
                                                    -----------    -----------
Cash at end of period                               $    26,884    $        --
                                                    ===========    ===========
Cash paid during the period for:
     Interest                                       $        --    $        --
                                                    ===========    ===========
     Income taxes                                   $        --    $        --
                                                    ===========    ===========

Please see the notes to the financial  statements  for  information  on non-cash
investing and financing activities.

              See accompanying notes to the financials statements.

                                      F-5

<PAGE>

                                     RUDY 45
                          NOTES TO FINANCIAL STATEMENTS
                                  JULY 31, 2005

1. ORGANIZATION AND BASIS OF PRESENTATION

Organization and Nature of Business

         Malahat Energy Corporation ("Malahat") is a Nevada corporation that was
formed on July 26, 1994. Malahat operated a development stage enterprise and was
engaged in the  development of BioFuel systems to convert organic waste material
into an  economical,  synthesized  fuel  gas  for  energy  consumption.  Malahat
completed a reverse merger with a publicly traded "Shell" company (see below) in
May 2001 and was quoted on the Over the Counter  Bulletin Board under the symbol
"MAHT".

         On August 30, 2004,  Malahat's  board of  directors  approved a plan of
reorganization  (the "Malahat Reorg") pursuant to which the Company  transferred
substantially  all of its assets and  liabilities,  except  for  liabilities  of
approximately  $70,000,  to  its  wholly  owned  subsidiary,   Malahat  Services
Corporation  ("MSC"). In connection with the plan of reorganization,  all of MSC
outstanding stock was distributed to the Malahat's  existing  stockholders.  See
note 3 for more information.

         On August 30, 2004 and in connection  with a stock purchase  agreement,
shareholders  owning  10,581,875  shares of common  stock (7,278  common  shares
giving effect to the reverse stock split described below), which represented 66%
of the Company's  outstanding stock agreed to sell their shares to new investors
for $85,000 in cash. In connection with foregoing, the officers and directors of
the Company resigned on August 30, 2004 and representatives of the new investors
assumed those positions.

         On December 22, 2004, it was approved by  stockholders to amend Article
I, Name of Company;  Malahat  changed its name to PHC  Holdings,  and elected to
become a Business  Development Company or "BDC" under the Investment Company Act
of 1940, as amended (the "1940 Act"). As of July 31, 2005, the Company traded on
the "pink sheets" under the name PHC Holdings and under the symbol "PHCD." Also,
it was approved by shareholders to amend Article IV,  Authorized  Capital Stock;
increasing its authorized  common stock to 500,000,000  shares,  each with a par
value of $0.001 per share;  and  increasing its  authorized  preferred  stock to
25,000,000  shares,  each with a par value of $0.001 per share, with the rights,
preferences,  privileges  and  restrictions  granted  to  or  imposed  upon  the
preferred stock to be determined by the board of directors.

            On August 10, 2005, it was approved by stockholders to amend Article
IV,  Authorized  Capital  Stock,  of the  Company's  Articles of  Incorporation,
increasing the total authorized common stock to 950,000,000  shares, each with a
par  value of  $0.001  per  share  ("Common  Stock")  and  50,000,000  shares of
Preferred  Stock  each  with a par value of  $0.001,  ("Preferred  Stock").  The
rights, preferences,  privileges and restrictions granted to or imposed upon the
Preferred Stock will be determined by the Board of Directors.

         On September 12, 2005,  the board of directors  received  authorization
from the stockholders to amend the articles of incorporation for Article 1, Name
of  Company;  changing  the  Company's  name from PHC  Holdings  to Rudy 45 (the
"Company");  and to  implement a 1450:1  reverse  stock  split of the  Company's
common stock  effective  September 26, 2005. The Company's  shareholders  record
reflects  on such date  86,963,207  issued  and  outstanding  shares  before the
reverse  stock split and 59,975 after the reverse  stock split.  The Company now
trades under the symbol "RDYF."

Nature of Business

         Subsequent  to the name change and  electing  to be a BDC,  the Company
will be continuously  seeking operating private profitable  entities in which to
invest in and offer  management  skills.  A BDC is defined and  regulated by the
Investment  Company Act of 1940 ("1940  Act").  A BDC must be  organized  in the
United  States for the purpose of investing  in or lending to primarily  private
companies  and making  managerial  assistance  available  to them. A BDC may use
capital  provided  by public  shareholders  and from other  sources to invest in
long-term,  private investments in businesses.  A BDC provides  shareholders the
ability to retain the liquidity of a publicly traded stock, while sharing in the
possible benefits, if any, of investing in primarily privately owned companies.

         The  Company  is  authorized  to  raise  up to  $5,000,000  in value of
securities  without  registration of said securities under the Securities Act of
1933; in reliance on the exemption provided by Rule 602(a) of Regulation E under
the 33 Act.  Through  July 31,  2005,  the  Company  has raised net  proceeds of
$504,849 against this limit.

                                      F-6

<PAGE>

                                     RUDY 45
                          NOTES TO FINANCIAL STATEMENTS
                                  JULY 31, 2005

Going Concern Basis of Presentation

            The accompanying  financial  statements have been prepared  assuming
that the Company continues as a going concern which contemplates the realization
of assets  and  settlement  of  liabilities  in the normal  course of  business.
Malahat has been in the development  stage since it began operations on July 26,
1994, and did not generate any revenues from its principal  operations and there
is  no  assurance  of  any  future  revenues.  As of  August  30,  2004  Malahat
reorganized  with  its  subsidiary  (see  Note 3) and  changed  its  name to PHC
Holdings  and  subsequently  to Rudy 45. The Company  elected to become a BDC on
December 22, 2004 and has not  generated  any revenues and there is no assurance
of any future revenues.  Further, the Company has limited or no prior history as
a BDC. As of July 31, 2005, the Company had an accumulated deficit of $3,408,236
and working capital of $8,284.

         The Company will require substantial  additional capital for continuing
BDC  administration,  compliance  requirements  and  the  implementation  of the
business plan as a BDC.  There can be no assurance that the Company will be able
to obtain  sufficient  additional  funds when  needed,  or that such  funds,  if
available, will be obtainable on terms satisfactory to the Company.

         Failure to secure such financing or to raise additional  equity capital
may result in the Company  depleting its  available  funds and not being able to
pay for its obligations.

         These  circumstances,  among others,  raise substantial doubt about the
Company's  ability to continue as a going concern.  The financial  statements do
not  include  any  adjustments  to reflect the  possible  future  effects on the
recoverability and classification of assets or the amounts and classification of
liabilities  that may  result  from the  possible  inability  of the  Company to
continue as a going concern.

2.  CERTAIN SIGNIFICANT ACCOUNTING POLICIES

         The  significant  accounting  policies  presented below are designed to
assist in  understanding  the Company's  financial  statements.  Such  financial
statements  and  accompanying  notes  are the  representation  of the  Company's
management,  who are  responsible  for their  integrity and  objectivity.  These
accounting policies conform to accounting  principles  generally accepted in the
United  States of  America  ("GAAP")  in all  material  respects,  and have been
consistently applied in preparing the accompanying financial statements.

Basis of Presentation and Consolidation

         As a result of the  reorganization  and  spin-off  of our wholly  owned
subsidiary described in Note 3, the accompanying financial statements as of July
31, 2005 are not  consolidated  and only  include  the  accounts of Rudy 45. The
accompanying  financial statements for the year ended July, 31, 2004 include the
accounts  of the  Company  and its  wholly  owned  subsidiary.  All  significant
intercompany transactions and balances have been eliminated in consolidation.

Discontinued Operations

         In accordance with SFAS No. 144, the Company accounts the operations of
the subsidiary subject to the  reorganization as discontinued  operations in all
periods  presented.  SFAS No. 144 requires  that the results of  operations of a
component of an entity that has been disposed,  distributed to the  shareholders
in a spin-off or that meets all of the "held for sale"  criteria,  be  accounted
for as discontinued  operations,  if the  component's  operations and cash flows
have been (or will be) eliminated from the ongoing operations of the entity as a
result  of the  transaction  and the  Company  will  not  have  any  significant
continuing involvement in the operations of the component after the transaction.
The classification as "discontinued  operations" requires having the appropriate
approvals by our management, Board of Directors, and stockholders as applicable,
and  meeting  other  criteria.  A  component  of an entity  that is  divested to
stockholders  is then to be  classified  as  discontinued  operations  when  the
divestment occurs.

                                      F-7

<PAGE>

                                     RUDY 45
                          NOTES TO FINANCIAL STATEMENTS
                                  JULY 31, 2005

         Revenues and expenses from Malahat  Services  Corporation for the years
ended July 31, 2005 and 2004 are summarized below:

                                                   2005       2004
                                               -----------   --------
Expenses
  General and administrative                   $        --   $(32,892)
  Gain on forgiveness of accrued liabilities            --     28,047
                                               -----------   --------
Net loss from discontinued operations          $        --   $ (4,854)
                                               ===========   ========

Risks and Uncertainties

         The Company has a limited  operating  history.  The Company has not yet
generated any revenue from its business  operations.  As a new operating entity,
the  Company  faces  risks  and   uncertainties   relating  to  its  ability  to
successfully implement its strategy. Among other things, these risks include the
ability to develop and sustain revenue growth;  managing  expanding  operations;
competition;  attracting,  retaining and  motivating  qualified  personnel;  and
maintaining and developing new strategic relationships.  The Company has limited
or no prior history as a BDC. The Company may be subject to the risks associated
with an emerging business, including the potential risks of business failure.

Use of Estimates

         The Company prepares its financial  statements in conformity with GAAP,
which  requires  management to make  estimates and  assumptions  that affect the
reported amounts of assets and liabilities,  disclosure of contingent assets and
liabilities  at the  date  of the  consolidated  financial  statements,  and the
reported  amounts  of  revenues  and  expenses  during  the  reporting   period.
Significant estimates made by management include, among others, realizability of
long-lived assets and estimates for the deferred income tax valuation allowance.
Actual results could differ from those estimates.

 Fair Values of Financial Instruments

         Statement  of   Financial   Accounting   Standards   ("SFAS")  No.  107
"Disclosures About Fair Value of Financial  Instruments"  requires disclosure of
fair value  information  about financial  instruments  when it is practicable to
estimate  that  value.  Management  believes  that the  carrying  amounts of the
Company's  financial  instruments,  consisting of cash and accounts  payable and
accrued liabilities, approximate their fair value at July 31, 2005, due to their
short-term nature.

Foreign Currency Translation

         Assets  and  liabilities  of the  Company's  Canadian  operations  were
translated into U.S.  Dollars at period-end  exchange rates.  Income and expense
are translated at weighted average  exchange rates for the period.  Net exchange
gains or losses  resulting from such  translation are excluded from net earnings
but are included in comprehensive  loss and accumulated in a separate  component
of  stockholders'  deficit.  The  Company  had no foreign  currency  translation
adjustments  for the year ended July 31, 2005 due to the Malahat Reorg.  For the
years  ended  July 31,  2005 and  2004,  the  Company  had no  foreign  exchange
transaction gains or losses.

                                      F-8
<PAGE>

                                     RUDY 45
                          NOTES TO FINANCIAL STATEMENTS
                                  JULY 31, 2005

Cash Equivalents

         The Company considers all highly liquid temporary cash investments with
original maturities of three months or less to be cash equivalents.  The Company
had no cash equivalents at July 31, 2005.

Property and Equipment

         Property  and   equipment   are  stated  at  cost,   less   accumulated
depreciation and  amortization.  Deprecation is provided using the straight-line
method over the estimated  useful lives of the related  assets.  Maintenance and
repairs are expensed as incurred, and betterments are capitalized. Upon the sale
or retirement of  depreciable  assets,  the accounts are relieved of the related
costs and accumulated  depreciation,  and any resulting gain or loss is included
in operations.

Long-Lived Assets

         SFAS No. 144,  "Accounting for the Impairment of Long-Lived  Assets and
for  Long-Lived  Assets to be  Disposed  of." SFAS No. 144  addresses  financial
accounting  and reporting for the  impairment or disposal of long-lived  assets.
SFAS 144 requires that  long-lived  assets be reviewed for  impairment  whenever
events or changes in  circumstances  indicate that their carrying amount may not
be  recoverable.  If the cost basis of a  long-lived  asset is greater  than the
projected future undiscounted net cash flows from such asset, an impairment loss
is recognized.  Impairment  losses are calculated as the difference  between the
cost basis of an asset and its  estimated  fair value.  As of July 31, 2005,  no
impairment indicators were noted.

Revenue Recognition

         During 2005, as a BDC, the Company  intends to recognize  revenues from
its  portfolio  companies  based  on  investment  income,  the  appreciation  or
impairment  associated  with its  investment  in such  companies.  There were no
revenues for the year ended July 31, 2005.

         Prior to its  election  as a BDC,  the Company  intended  to  recognize
revenue from product sales, net of any discounts,  when products are shipped and
title passes to customers. Revenues from services were intended to be recognized
at the time the related service was performed.  From inception  through July 31,
2004, the Company had generated no revenues.

         In  December  1999,  the  Securities  and  Exchange  Commission  issued
Bulletin No. 101 ("SAB 101"). SAB 101, which was subsequently  superseded by SAB
104, provides guidance on applying accounting  principles  generally accepted in
the United States of America to revenue recognition in financial statements. The
Company intends to comply with the provisions of SAB.

Advertising

         The Company  expenses  the cost of  advertising  under the "General and
administrative"  caption of the statements of operations and comprehensive  loss
when incurred.  The Company had no advertising  expenses in the years ended July
31, 2005 and 2004.

Income Taxes

         The Company  follows SFAS No. 109 ("SFAS 109"),  "Accounting for Income
Taxes" for recording  the  provision  for income taxes.  Deferred tax assets and
liabilities  are computed  based upon the  difference  between the  consolidated
financial  statement  and income tax basis of assets and  liabilities  using the
enacted  marginal  tax rate  applicable  when the related  asset or liability is
expected to be realized or settled. Deferred income tax expenses or benefits are
based on the  changes  in the  asset or  liability  each  period.  If  available
evidence  suggests  that it is more likely than not that some  portion or all of
the deferred tax assets will not be realized,  a valuation allowance is required
to reduce the  deferred tax assets to the amount that is more likely than not to
be realized.  Future  changes in such  valuation  allowance  are included in the
provision for income taxes in the period of change.

                                      F-9

<PAGE>

                                     RUDY 45
                          NOTES TO FINANCIAL STATEMENTS
                                  JULY 31, 2005

Stock-Based Compensation

         The Financial  Accounting  Standards Board ("FASB") issued SFAS No. 123
("SFAS 123"), "Accounting for Stock-Based Compensation." This standard, if fully
adopted,  changes the method of accounting for employee stock-based compensation
plans to the fair value based method. For stock options and warrants, fair value
is  determined  using an option  pricing model that takes into account the stock
price at the grant date, the exercise price,  the expected life of the option or
warrant and the annual rate of quarterly  dividends.  Compensation  expense,  if
any, is recognized  over the  applicable  service  period,  which is usually the
vesting period.

         The adoption of the accounting  methodology of SFAS 123 is optional and
the  Company has elected to continue  accounting  for  stock-based  compensation
issued to employees  using APB 25;  however,  pro forma  disclosures,  as if the
Company adopted the cost recognition  requirements  under SFAS 123, are required
to be presented.

         The Company has no stock-based compensation plans as of July 31,2005 or
for the years  ended July 31, 2005 and 2004.  The  Company  did issue,  however,
1,400,000 shares of restricted  common stock (966 common shares giving effect to
the reverse stock split) to two employees as partial  compensation  for services
provided  during the year ended July 31,  2005.  Such  shares  were valued at an
aggregate  amount  approximating  $57,000  based on stock  sales on or about the
issuance dates (see Note 5) ,

Basic and Diluted Loss per Common Share

         The Company  follows SFAS No. 128 ("SFAS  128"),  "Earnings per Share."
Under  SFAS  128,  basic  earnings  per share is  computed  by  dividing  income
available to common shareholders by the weighted-average number of common shares
assumed to be outstanding during the period of computation. Diluted earnings per
share  is  computed  similar  to  basic  earnings  per  share  except  that  the
denominator is increased to include the number of additional  common shares that
would have been  outstanding if the potential  common shares had been issued and
if the  additional  common  shares  were  dilutive  (there  were  no  additional
potential common shares as of July 31, 2005 and 2004,  respectively).  Pro forma
per share data has been  computed  using the weighted  average  number of common
shares  outstanding  during the  periods.  Because the Company has  incurred net
losses,  basic and diluted loss per share are the same as  additional  potential
common shares would be anti-dilutive (See Note 7).

Comprehensive Income (Loss)

         SFAS No. 130 ("SFAS 130"), "Reporting Comprehensive Income" establishes
standards  for  reporting  and display of  comprehensive  income  (loss) and its
components  in  a  full  set  of  general-purpose  financial  statements.  Total
comprehensive  income (loss)  represents the net change in stockholders'  equity
during a period from sources other than  transactions  with  stockholders and as
such,  includes  net  earnings.   For  the  Company,  the  components  of  other
comprehensive  income (loss) are the changes in the cumulative  foreign currency
translation adjustments and are recorded as components of stockholders' deficit.

Segments of an Enterprise and Related Information

         The  Company  adopted  SFAS No. 131 ("SFAS  131"),  "Disclosures  about
Segments  of an  Enterprise  and  Related  Information."  SFAS  131  establishes
standards for the way public  companies  report  information  about  segments of
their business in their annual financial  statements and requires them to report
selected segment  information in their quarterly reports issued to shareholders.
It also  requires  entity-wide  disclosures  about the  products and services an
entity  provides,  the  material  countries in which it holds assets and reports
revenues  and its major  customers.  The Company  has had no revenues  since its
inception.

Recently Issued Accounting Pronouncements

         In  December  2004,  the  FASB  issued  SFAS  No.  123-R,  "Share-Based
Payment,"  which  requires that the  compensation  costs relating to share-based
payment  transactions  (including  the cost of all  employee  stock  options) be
recognized in the financial statements.  That cost will be measured based on the
estimated  fair value of the equity or liability  instruments  issued.  SFAS No.
123-R covers a wide range of  share-based  compensation  arrangements  including
share  options,   restricted  share  plans,   performance-based   awards,  share
appreciation  rights, and employee share purchase plans. SFAS No. 123-R replaces
SFAS No. 123,  and  supersedes  APB Opinion No. 25. Small  Business  Issuers are
required to apply SFAS No. 123-R in the first  interim  reporting  period of the
first annual  period that begins after  December 15, 2005.  The adoption of SFAS
123-R is not  expected  to have a  material  impact on the  Company's  financial
statements.

                                      F-10

<PAGE>

                                     RUDY 45
                          NOTES TO FINANCIAL STATEMENTS
                                  JULY 31, 2005

         In December 2004, the FASB issued SFAS No. 153 ("SFAS 153"), "Exchanges
of  Nonmonetary  Assets,  an  Amendment  of APB Opinion No. 29,  Accounting  for
Nonmonetary  Transactions."  The  amendments  made by SFAS 153 are  based on the
principle  that  exchanges of  nonmonetary  assets should be measured  using the
estimated  fair value of the assets  exchanged.  SFAS 153  eliminates the narrow
exception for nonmonetary  exchanges of similar  productive assets, and replaces
it with a broader exception for exchanges of nonmonetary assets that do not have
commercial substance.  A nonmonetary exchange has "commercial  substance" if the
future cash flows of the entity are expected to change significantly as a result
of the transaction. This pronouncement is effective for nonmonetary exchanges in
fiscal periods  beginning  after June 15, 2005. The adoption of SFAS 153 did not
have a material impact on the Company's financial statements.

         In May 2005,  the FASB  issued SFAS No.  154,  "Accounting  Changes and
Error  Corrections," which replaces APB Opinion No. 20 and FASB Statement No. 3.
This pronouncement applies to all voluntary changes in accounting principle, and
revises the requirements for accounting for and reporting a change in accounting
principle.  SFAS No. 154 requires  retrospective  application  to prior periods'
financial statements of a voluntary change in accounting principle, unless it is
impracticable  to do so. This  pronouncement  also requires that a change in the
method of depreciation, amortization, or depletion for long-lived, non-financial
assets be accounted for as a change in accounting estimate that is affected by a
change in  accounting  principle.  SFAS No. 154 retains many  provisions  of APB
Opinion 20 without  change,  including  those  related to  reporting a change in
accounting  estimate,  a change in the reporting  entity,  and  correction of an
error. The pronouncement also carries forward the provisions of SFAS No. 3 which
govern reporting  accounting changes in interim financial  statements.  SFAS No.
154 is effective for accounting changes and corrections of errors made in fiscal
years  beginning  after  December 15, 2005.  The  Statement  does not change the
transition provisions of any existing accounting pronouncements, including those
that are in a  transition  phase as of the  effective  date of SFAS No. 154. The
adoption of SFAS 154 did not have a material  impact on the Company's  financial
statements.

         Other recent  accounting  pronouncements  issued by the FASB (including
its  Emerging  Issues  Task  Force),  the AICPA,  and the SEC did not or are not
believed by  management to have a material  impact on the  Company's  present or
future financial statements.

3.   MALAHAT REORGANIZATION

         On August 30, 2004,  Malahat's  board of  directors  approved a plan of
reorganization  (the "Malahat Reorg") pursuant to which the Company  transferred
fixed and other assets  approximating  $18,000 and accounts  payable and accrued
liabilities and due to related party approximating  $175,000 to its wholly owned
subsidiary, Malahat Services Corporation ("MSC"). In connection with the plan of
reorganization,  all of MSC  outstanding  stock was distributed to the Malahat's
existing  stockholders.  The  reorganization  was accounted using the historical
carrying  amounts of assets and liabilities  distributed  and reflected  against
paid in capital. The assets and liabilities and results of operations of the net
assets  distributed  to the  former  shareholders  have  been  reflected  in the
accompanying financial statements as discontinued operations.  The net effect of
transferring  such assets and liabilities plus accumulated  other  comprehensive
income resulted in an increase to additional  paid-in  capital of  approximately
$182,000.

         Additionally,  shareholders  owning  10,581,875  shares of common stock
(7,278 common shares giving effect to the reverse stock split described  below),
which  represented 66% of the Company's  outstanding  stock agreed to sell their
shares to new  investors.  In connection  with the  foregoing,  the officers and
directors of the Company resigned on August 30, 2004 and  representatives of the
new investors assumed those positions.

4.  PROPERTY AND EQUIPMENT

         Property and equipment consists of the following at July 31, 2005:

                  Computer hardware and software            $    6,023
                                                            ----------
                                                                 6,023
                  Accumulated depreciation                          --
                                                            ----------
                                                            $    6,023
                                                            ==========

                                      F-11

<PAGE>

                                     RUDY 45
                          NOTES TO FINANCIAL STATEMENTS
                                  JULY 31, 2005

5.  EQUITY TRANSACTIONS

Preferred Stock

         The Company is  authorized  effective  December 22, 2004 to issue up to
25,000,000  shares of  preferred  stock at $0.001  par value,  with all  rights,
preferences,  privileges  and  restrictions  granted  to  or  imposed  upon  the
preferred stock determined by the board of directors.  The authorized  number of
preferred shares was increased to 50,000,000 on August 10, 2005.

Common Stock

         The Company is  authorized  effective  December 22, 2004 to issue up to
500,000,000 shares of common stock at $0.001 par value. The authorized number of
preferred  shares was increased to  950,000,000 on August 10, 2005. On September
12, 2005, the Company  implemented a 1450:1  reverse stock split.  The Company's
records  reflect on such date 86,963,207  issued and  outstanding  common shares
before the reverse  stock split and 59,975 common shares after the reverse stock
split.  Accordingly,  during the year ended July 31,  2005,  the Company  issued
52,236,330  common  shares  (representing  36,025  shares  giving  effect to the
reverse stock split declared September 2005), as discussed below.

         On December 15, 2004,  the Company  issued  6,425,000  shares of common
stock (4,431  shares  giving  effect to the reverse stock split) in exchange for
services  provided by certain  consultants.  Such shares were valued at $393,210
(estimated to be the fair value based on private placement sales on or about the
issuance date).

         On January 27, 2005, the Company entered into an agreement  pursuant to
which we sold 1,100,000  shares of our common stock (759 shares giving effect to
the reverse stock split) for an aggregate purchase price of $1,100,000.

         During the quarter  ended,  April 30,  2005,  the Company  entered into
agreements  pursuant to which we sold  1,750,000  shares of common  stock (1,207
shares giving effect to the reverse stock split) for an aggregate of $124,000 in
proceeds.

         During the quarter ended,  April 30, 2005, the Company issued 3,155,000
shares of common stock (2,176  shares  giving effect to the reverse stock split)
in  exchange  for  services  provided by certain  consultants.  Such shares were
valued at $182,845  (estimated  to be the fair value based on private  placement
sales on or about the issuance date).

         During the quarter  ended,  July 31,  2005,  the Company  entered  into
agreements  pursuant to which we sold 33,150,000  shares of common stock (22,862
shares giving effect to the reverse stock split) for an aggregate of $403,250 in
proceeds.

         During the quarter ended,  July 31, 2005, the Company issued  6,656,330
shares of common stock (4,591  shares  giving effect to the reverse stock split)
in  exchange  for  services  provided by certain  consultants.  Such shares were
valued at $222,101  (estimated  to be the fair value based on private  placement
sales on or about the issuance date).

6.  INCOME TAX PROVISION

         There is no material  income tax expense  recorded  for the years ended
July 31, 2005 and 2004, due to the Company's net losses.

         Income tax expense for the years ended July 31, 2005 and 2004  differed
from the amounts  computed by applying  the U.S.  federal  income tax rate of 34
percent for the following reasons:

                                                            2005         2004
                                                         ----------    --------
Income tax benefit at U.S. federal statutory rates       $ (418,000)   $ (2,000)
State taxes                                                 (74,000)         --
Change in valuation allowance                               492,000      (2,000)
                                                         ----------    --------
                                                         $       --    $     --
                                                         ==========    ========

                                      F-12

<PAGE>

                                     RUDY 45
                          NOTES TO FINANCIAL STATEMENTS
                                  JULY 31, 2005

The Company  provides  deferred income taxes for temporary  differences  between
assets  and  liabilities  recognized  for  financial  reporting  and  income tax
purposes. The tax effects of temporary differences at July 31 are as follows:

                                           2005           2004
                                       ===========    ===========
Deferred tax assets:
   Net operating loss carry forwards   $   874,000    $   874,000
   Accrued wages                                --             --
   Tax credits                             480,000        480,000
        Total deferred tax assets        1,354,000      1,354,000
                                       -----------    -----------
        Less valuation allowance        (1,354,000)    (1,354,000)
                                       -----------    -----------
        Net deferred tax assets        $        --    $        --
                                       ===========    ===========

         As of July 31,  2005,  the Company had tax net  operating  loss ("NOL")
carryforwards  of approximately  $2.2 million.  For federal income tax purposes,
the NOL's  expire at  varying  dates  ending in 2024.  For  foreign  income  tax
purposes,  the NOL's have no expiration  date. The Company also has research and
development credit carryforwards of approximately  $480,000 which expire through
2023. Due to the "change in ownership" provisions of the Tax Reform Act of 1986,
the  Company's  net  operating  loss  carryforwards  may be subject to an annual
limitation on the utilization of these  carryforwards  against taxable income in
future  periods  if a  cumulative  change in  ownership  of more than 50% occurs
within any three-year period. In assessing the realizability of the net deferred
tax assets, management considers whether it is more likely than not that some or
all of the deferred tax assets will not be realized. The ultimate realization of
deferred tax assets  depends upon either the generation of future taxable income
during the periods in which those temporary differences become deductible or the
carryback of losses to recover income taxes previously paid during the carryback
period.  As of July 31, 2005, the Company had provided a valuation  allowance of
$1,354,000  to reduce the deferred tax assets.  The net change in the  valuation
allowance for fiscal year 2005 was an increase of $2,000.

         On October 22, 2004,  the American  Jobs  Creation Act of 2004 ("AJCA")
was signed into law. The AJCA provides  several  incentives for US multinational
corporations  and  US  manufacturers.   Subject  to  certain  limitations,   the
incentives include an 85% dividend received deduction for certain dividends from
controlled foreign corporations that repatriate accumulated income abroad, and a
deduction for domestic  qualified  production  activities taxable income. The US
Treasury  Department  is expected to issue  additional  guidance with regards to
these provisions.  In December 2004, the FASB issued FSP 109-2,  "Accounting and
Disclosure Guidance for the Foreign  Repatriation  Provision within the American
Jobs  Creation Act of 2004." FSP 109-2 states that an enterprise is allowed time
beyond the financial reporting period of enactment to evaluate the effect of the
Act on its plan for  reinvestment or  repatriation  of foreign  earnings for the
purposes of applying  FASB  Statement No. 109.We are in the process of analyzing
whether to take  advantage of this  opportunity  or the potential  impact on our
income tax provision, if any.

                                      F-13

<PAGE>

                                     RUDY 45
                          NOTES TO FINANCIAL STATEMENTS
                                  JULY 31, 2005

7.  INCOME/LOSS PER COMMON SHARE

         The following is a reconciliation of the numerators and denominators of
the basic and diluted  income/loss per common share  computations  for the years
ended July 31, 2005 and 2004:

<TABLE>
<CAPTION>
                                                                        2005           2004
                                                                    -----------    -----------
<S>                                                                 <C>            <C>
Numerator for basic and diluted income (loss) per common share:

     Net (loss) income attributed to common shareholders            $(1,230,644)   $    (4,845)

Denominator for basic and diluted income (loss) per common share:

     Weighted average number of common shares outstanding *              19,198         10,856

                                                                    -----------    -----------
Basic and diluted (loss) income per common share                    $    (64.10)   $     (0.45)
                                                                    ===========    ===========
</TABLE>

* Reflects effect of 1450:1 reverse stock split declared September 26, 2005.

8.   SUBSEQUENT EVENTS (UNAUDITED)

         During August and September  2005, the Company  entered into agreements
pursuant  to which we sold 11,448  shares of common  stock for an  aggregate  of
$29,000 in proceeds.

         During August and September  2005,  the Company  issued 1,462 shares of
common  stock in exchange  for services  provided by certain  consultants.  Such
shares  were valued at $5,300  (estimated  to be the fair value based on private
placement sales on or about the issuance date).

         On September 12, 2005,  the board of directors  received  authorization
from the  shareholders  to amend the  articles of  incorporation  for Article 1,
Company Name;  changing the Company's name to Rudy 45; and to implement a 1450:1
reverse stock split of the Company's  common stock;  and a new trading symbol of
RDYF.PK; all effective September 26, 2005.

         On September 23, 2005, the  registrant  entered into a Letter of Intent
to acquire all of the outstanding stock of Rudy  International  Marketing,  Ltd.
("RIM") in  exchange  for  shares of shares of  restricted  common  stock of the
registrant.  It is  anticipated  that the parties  will enter into a  definitive
Stock  Purchase  Agreement  with an  expected  closing  to occur  no later  than
December 15, 2005.

                                      F-14

<PAGE>

ITEM 8 CHANGES AND  DISAGREEMENTS  WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIALS
DISCLOSURE.

       None

ITEM 8A CONTROLS AND PROCEDURES

Evaluation of Controls and Procedures

         The Company's  board of directors and  management,  including the Chief
Executive  Officer ("CEO") and Chief Financial  Officer  ("CFO"),  evaluated the
effectiveness of the design and operation of the Company's  disclosure  controls
and  procedures,  as defined in Rule 13a-15(e) and 15d-15(e) of the Exchange Act
as of a date  (the  "Evaluation  Date"),  within  90 days  prior to  filing  the
Company's July 31, 2005 Form 10-KSB.  Based upon that evaluation,  the Company's
board of directors and management, including the CEO and CFO, concluded that, as
of July  31,  2005,  the  Company's  disclosure  controls  and  procedures  were
effective  in  alerting  management  on  a  timely  basis  to  material  Company
information  that would be required to be included in our periodic  filings with
the SEC.

         Based on their most recent  evaluation as of the  Evaluation  Date, the
CEO and the CFO have also concluded that the other controls and procedures, that
are designed to ensure that information required to be disclosed in our periodic
filings  with the SEC,  have not been  adequate,  resulting in a pattern of late
filings  which the board of directors  and  management  have now taken  specific
steps to correct.

Changes in Internal Control

         There  were  no  significant  changes  made in the  Company's  internal
controls over  financial  reporting,  during the year ended July 31, 2005,  that
have materially  affected,  or are reasonably likely to materially affect, these
internal  controls.  Thus, no  corrective  actions,  with regard to  significant
deficiencies or material weaknesses, were necessary.

Limitations on the Effectiveness of Internal Controls

         Our  management  does not  expect  that  our  disclosure  controls  and
procedures or our internal  control over financial  reporting  will  necessarily
prevent all fraud and material error. An internal control system,  no matter how
well  conceived  and  operated,  can  provide  only  reasonable,  not  absolute,
assurance that the objectives of the control system are met. Further, the design
of a control  system must reflect the fact that there are resource  constraints,
and the benefits of controls must be considered relative to their costs. Because
of the inherent  limitations in all control  systems,  no evaluation of controls
can provide  absolute  assurance that all control issues and instances of fraud,
if any,  within the  Company  have been  detected.  These  inherent  limitations
include the realities that judgments in decision-making  can be faulty, and that
breakdowns can occur because of simple error or mistake. Additionally,  controls
can be circumvented by the individual acts of some persons,  by collusion of two
or more people, or by management override of the internal control. The design of
any system of controls also is based in part upon certain  assumptions about the
likelihood of future  events,  and there can e no assurance that any design will
succeed in achieving  its stated goals under all  potential  future  conditions.
Over time,  control may become inadequate  because of changes in conditions,  or
the degree of compliance with the policies or procedures may deteriorate.

                                       14

<PAGE>

                                    PART III

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

Directors and Executive Officers

The following  table sets forth  certain  information  concerning  its executive
officers and directors as of July 31, 2005:

          Name          Age        Position / Office Held
      --------------------------------------------------------------------
      Sonia Farrell     34         President and Director

      Pearl Asencio     55         Vice President, Secretary, Director and
                                   Principal Accounting Officer

         Sonia Farrell has been the executive  assistant for over six years to a
prominent actor who has had leading roles in film, TV and on Broadway.  Prior to
that,  she was an executive  assistant for six years to the CEO of an investment
banking firm which specialized in small-cap companies.

         Pearl Asencio recently retired after six years as the special executive
administrator  for the managing  partner of a financial  consulting  firm. Prior
thereto,  she was an officer and director of a publicly  traded  technology firm
and was in charge of all administrative operations.

         Directors  are  generally   elected  at  the  annual   meeting  of  its
shareholders.  Each  director  holds office  until his  successor is elected and
qualified and, thus, generally hold one-year terms.

         Executive  officers are chosen by, and serve at the  discretion of, its
board of directors,  absent any  employment  agreement,  of which none currently
exists.

Family Relationships

         There  are no family  relationships  between  or among  the  directors,
executive  officers,  or persons  nominated  or chosen by the  Company to become
directors or executive officers.

Involvement in Legal Proceedings

         To the best of the  Company's  knowledge,  during the past five  years,
none of the following  occurred with respect to a present or former  director or
executive  officer  of the  Company:  (1) Any  bankruptcy  petition  filed by or
against any  business or which such  person was a general  partner or  executive
officer  either at the time of the  bankruptcy or within two years prior to that
time; (2) Any conviction in a criminal  proceeding or being subject to a pending
criminal proceeding (excluding traffic violations and other minor offences); (3)
Being  subject to any order,  judgment  or decree,  not  subsequently  reversed,
suspended or vacated, of any court of any competent jurisdiction, permanently or
temporarily enjoining, barring, suspending or otherwise limiting his involvement
in any type of business,  securities or banking activities;  and (4) Being found
by a  court  of  competent  jurisdiction  (in a  civil  action)  the  SEC or the
Commodity  Futures  Trading  Commission  to have  violated  a  federal  or state
securities  or  commodities  law,  and the  judgment  has not been  reversed  or
vacated.

                                       15

<PAGE>

Section 16(A) Beneficial Ownership Report Compliance

         Section 16(a) of the Exchange Act requires its  executive  officers and
directors,  and persons who beneficially own more than 10% of a registered class
of its equity securities,  to file with the Securities Exchange  Commission,  or
Commission,  initial reports of ownership and reports of changes in ownership of
common stock and its other  equity  securities.  Such  officers,  directors  and
shareholders are required by Commission regulations to furnish it with copies of
all reports so filed.

         Based  solely upon  review,  the two  officers of the Company  have not
filed  their Form 3 timely for the fiscal year ended July 31,  2005,  therefore,
all Section 16(a) filing  requirements  applicable to its reporting persons were
not met.

Code of Ethics Disclosure

         As of December 22, 2004, we have adopted the Code of Ethics,  the Audit
Committee  Charter  and the  Investment  Committee  Charter  for  our  principal
executive,  financial,  and accounting  officers or persons  performing  similar
functions,  as  required  for  listed  issuers  by  sections  406 and 407 of the
Sarbanes-Oxley Act of 2002.

Audit Committee Financial Expert

         During the fiscal year ended July 31, 2005, the Company's directors act
as the audit committee members, and have not appointed a financial expert.

ITEM 10  EXECUTIVE COMPENSATION

The Company paid the following  compensation to the named executive officers for
the fiscal year ended July 31, 2004:

<TABLE>
<CAPTION>
                                                     SUMMARY COMPENSATION TABLE

                                    Annual Compensation                        Long Term Compensation
                            -----------------------------------     ------------------------------------------------
                                                  Other Annual       Restricted                           All Other
                              Salary    Bonus     Compensation      Stock Awarded      Options/SARs     Compensation
Name                  Year      $         $             $                 $                 #                 $
---------------------------------------------------------------------------------------------------------------------
<S>                   <C>    <C>        <C>            <C>            <C>                 <C>                <C>
Jake Neufeld          2005      0         0             0                 0                 0                 0
                      2004      0         0             0                 0                 0                 0

Bruce Ramsay          2005      0         0             0                 0                 0                 0
                      2004      0         0             0                 0                 0                 0

Sonia Farrell         2005      0         0             0              28,490               0                 0
                      2004      0         0             0                 0                 0                 0

Pearl Asencio         2005   $10,131      0             0              28,490               0                 0
                      2004      0         0             0                 0                 0                 0
</TABLE>

         None of the above named  executive  officers had employment  agreements
during the fiscal year ended July 31, 2004 and 2005;  and Pearl  Asencio was the
only officer which received compensation during fiscal 2005. Mr. Neufeld and Mr.
Ramsay resigned effective June 30, 2004 and Mrs. Farrell and Mrs. Asencio became
directors and officers in July 2005.

                                       16

<PAGE>

Stock Option Plan

         On August 1, 2002,  the  Company's  Board  approved the Malahat  Energy
Corporation  Stock  Option Plan (the  "Plan"),  effective  upon  approval by the
shareholders  of the Company by July 31, 2004.  Shareholders  of Malahat did not
approve the Plan and the Plan was abandoned.

         No retirement,  pension,  profit sharing, or similar programs have been
adopted by the Company for the benefits of its employees.

         Directors  are not  compensated  for any  services  they may provide as
directors on the Company's board of directors.

         The Articles of Incorporation provide for a limitation on the liability
of officers and directors of the Company, specifically "A director or officer of
the  Corporation  shall have no personal  liability  to the  Corporation  or its
stockholders  for damages for breach of fiduciary duty as a director or officer,
except for  damages  for breach of  fiduciary  duty  resulting  from (a) acts or
omissions which involve intentional misconduct, fraud, or a knowing violation of
law, or (b) the payments of  dividends  in  violation  of section  78.300 of the
Nevada Revised  Statutes as it may from time to time be amended or any successor
provision thereto."

ITEM 11  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

         The following  table sets forth  information  regarding the  beneficial
ownership of its common stock as of September 26, 2005 by:

         o  each  person  known by it to own  beneficially  more than 5%, in the
            aggregate, of the outstanding shares of its common stock;

         o  each of its directors;

         o  it's named  executive  officers  in the Summary  Compensation  Table
            above; and

         o  all of its directors and executive officers as a group.

         The following  calculations  of the percent of  outstanding  shares are
based on 59,979 shares of its common stock issued and outstanding as of November
7, 2005.  Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission,  and generally includes voting or investment
power with respect to  securities.  Except as indicated in the  footnotes to the
table,  the  Company  believes  each  shareholder   possesses  sole  voting  and
investment power with respect to all of the shares of common stock owned by that
shareholder,  subject to community property laws where applicable.  In computing
the number of shares  beneficially  owned by a  shareholder  and the  percentage
ownership  of that  shareholder,  shares of common  stock  subject to options or
warrants held by that person that are currently  exercisable or are  exercisable
within  sixty  days after the date of the table are  deemed  outstanding.  Those
shares,  however,  are not deemed  outstanding  for the purpose of computing the
percentage  ownership of any other person or group.  Except as described  below,
beneficial ownership and, accordingly, percent of class ownership, is calculated
pursuant to Securities and Exchange Commission Rule 13d-3.

<TABLE>
<CAPTION>
                                                     AMOUNT AND NATURE OF
         NAME AND ADDRESS                            BENEFICIAL OWNERSHIP               PERCENT
         OF BENEFICIAL OWNER (1)                     OF COMMON STOCK                    OF COMMON STOCK
         -----------------------                     --------------------               ---------------
<S>                                                 <C>                                 <C>
         The ownership of Common Stock of the current  officers and directors of the Company is as follows:

         Sonia Farrell                               483 shares                         Less than 1%
         Pearl Asencio                               310 shares                         Less than 1%

         All officers and directors                  793 shares
         As a group (2 persons)

         (1)  c/o Rudy 45
              2633 Lincoln Blvd, #117
              Santa Monica, California  90405

         The ownership of Common Stock of more that 5%  Beneficial  Owners is as follows:
         ------------------------------
         American Capital Partners Ltd.              8,276 shares                       13.8%
         14 Wall Street
         New York, NY  10005
</TABLE>

                                       17

<PAGE>

ITEM 12  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

         None

ITEM 13  EXHIBITS

Exhibit No.       Description
-----------       -----------
Exhibit 3.1*      Certificate  of Existence  with Status in Good Standing of the
                  Registrant, dated December 8, 2004

Exhibit 3.2*      Certificate of Amendment to the Articles of  Incorporation  of
                  the Registrant, dated December 22, 2004.

Exhibit 3.3*      By-Laws of the Registrant

Exhibit 3.4*      Certificate  of Existence  with Status in Good Standing of the
                  Registrant, dated January 20, 2005.

Exhibit 3.5*      Amended List of Officers,  Directors and Resident Agent of the
                  Registrant, dated March 7, 2005.

Exhibit 3.6*      Certificate of Amendment to the Articles of  Incorporation  of
                  the Registrant, dated August 15, 2005.

Exhibit 3.7*      Certificate of Amendment to the Articles of  Incorporation  of
                  the Registrant, dated September 14, 2005.

Exhibit 31.1*     Certification  of Chief Executive  Officer pursuant to Section
                  302 of the Sarbanes-Oxley Act.

Exhibit 31.2*     Certification  of Chief Financial  Officer pursuant to Section
                  302 of the Sarbanes-Oxley Act.

Exhibit 32.1*     Certification  of Chief Executive  Officer pursuant to Section
                  906 of the Sarbanes-Oxley Act.

Exhibit 32.2*     Certification  of Chief Financial  Officer pursuant to Section
                  906 of the Sarbanes-Oxley Act.

------------------
*   Filed herewith

ITEM 14.  PRINCIPAL ACCOUNTANT FEES AND SERVICES

Audit Fees

         The  aggregate  fees billed by our auditors for  professional  services
rendered in connection with a review of the financial statements included in our
quarterly  reports  on Form  10-QSB  and the  audit of our  annual  consolidated
financial  statements for the fiscal year ended July 31, 2005 was  approximately
$37,000.

Audit-Related Fees

         The  aggregate  fees billed by our auditors for  assurance  and related
services that reasonably  relate to Form 8-K were zero for the fiscal year ended
July 31, 2005.

Tax Fees

         The aggregate fees billed by our auditors for professional services for
tax compliance, tax advice, and tax planning were zero for the fiscal year ended
July 31, 2005.

All Other Fees

         The  aggregate  fees  billed by our  auditors  for all other  non-audit
services,   such  as  attending  meetings  and  other  miscellaneous   financial
consulting were zero for the fiscal year ended July 31, 2005.

                                       18

<PAGE>

                                   SIGNATURES

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

           RUDY 45

By:        /s/ Sonja Farrell                            Date:  November 11, 2005
           ---------------------------------------
           Sonia Farrell
           President and Director

By:        /s/ Pearl Asencio                            Date:  November 11, 2005
           ---------------------------------------
           Pearl Asencio
           Vice President, Secretary, Director and
           Principal Accounting Officer

<PAGE>

                                  EXHIBIT INDEX

Exhibit 3.1       Certificate  of Existence  with Status in Good Standing of the
                  Registrant, dated December 8, 2004

Exhibit 3.2       Certificate of Amendment to the Articles of  Incorporation  of
                  the Registrant, dated December 22, 2004.

Exhibit 3.3       By-Laws of the Registrant

Exhibit 3.4       Certificate  of Existence  with Status in Good Standing of the
                  Registrant, dated January 20, 2005.

Exhibit 3.5       Amended List of Officers,  Directors and Resident Agent of the
                  Registrant, dated March 7, 2005.

Exhibit 3.6       Certificate of Amendment to the Articles of  Incorporation  of
                  the Registrant, dated August 15, 2005.

Exhibit 3.7       Certificate of Amendment to the Articles of  Incorporation  of
                  the Registrant, dated September 14, 2005.

Exhibit 31.1      Certification  of Chief Executive  Officer pursuant to Section
                  302 of the Sarbanes-Oxley Act.

Exhibit 31.2      Certification  of Chief Financial  Officer pursuant to Section
                  302 of the Sarbanes-Oxley Act.

Exhibit 32.1      Certification  of Chief Executive  Officer pursuant to Section
                  906 of the Sarbanes-Oxley Act.

Exhibit 32.2      Certification  of Chief Financial  Officer pursuant to Section
                  906 of the Sarbanes-Oxley Act.