Filed by Automated Filing Services Inc. (604) 609-0244 - Banyan Corp.

SB-2 1 formsb2.htm REGISTRATION STATEMENT Filed by Automated Filing Services Inc. (604) 609-0244 - Banyan Corp. - Form SB-2

As filed with the Securities and Exchange Commission on February 14, 2006
Registration No. 333

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

FORM SB-2

REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

BANYAN CORPORATION
(Name of small business as specified in its charter)

OREGON	8011	84-1346327
(State or other jurisdiction of	(Primary Standard Industrial	(I.R.S. Employer
Incorporation or Organization)	Classification Code Number)	Identification No.)

Suite 500, 1925 Century Park East, Los Angeles, CA 90067-2700, 1-800-808-0899
(Address and telephone number of principal executive offices and principal place of business)

Michael J. Gelmon, Suite 500, 1925 Century Park East, Los Angeles, CA 90067-2700 1-800-808-0899
(Name address and telephone number or agent for service)

COPIES TO:
Noel E. Guardi, Attorney at Law
P.O. Box 381 Pinecliffe, Colorado 80471
(303) 969-8886
Fax: (303) 969-8887

Approximate date of commencement of proposed sale to the public: from time to time after this registration becomes
effective.

If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act,
please check the following box and list the Securities Act registration number of the earlier effective registration
statement for the same offering. ¨

If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following
box and list the Securities Act registration statement number of the earlier effective registration statement for the same
offering. ¨

If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨

If the delivery of the prospectus is expected to be made pursuant to Rule 434, check the following box. ¨

CALCULATION OF REGISTRATION FEE

Title of each class of securities to be registered	Amount to be registered ⁽¹⁾	Proposed maximum offering price per unit ⁽¹⁾	Proposed maximum aggregate offering price ⁽¹⁾	Amount of registration fee



Common Stock, no par value, issuable upon conversion of 2006 Convertible Notes	1,200,000,000⁽²⁾	$.005⁽³⁾	$6,000,000





Common Stock, no par value underlying 2006 Warrants	90,000,000	.001⁽⁴⁾	90,000⁽⁵⁾



Common Stock, no par value, issuable upon conversion of 2004 Convertible Notes	710,000,000⁽²⁾⁽⁶⁾	.005⁽³⁾	3,550,000







Total	2,000,000,000		$9,640,000	$1,031.48

(1) Includes shares of our common stock, no par value per share, which may be offered pursuant to this registration statement, issuable upon conversion of the 2006 Convertible Notes and the 2004 Convertible Notes (collectively, the “Convertible Notes”) and the exercise of related Warrants held by the Selling Shareholders. In addition to the shares set forth in the table, the amount to be registered includes an indeterminate number of shares issuable upon conversion of the Convertible Notes and exercise of the Warrants, as such number may be adjusted as a result of stock splits, stock dividends and similar transactions in accordance with Rule 416. The number of shares of common stock registered hereunder represents a good faith estimate by us of the number of shares of common stock issuable upon conversion of the Convertible Notes and upon exercise of the Warrants. For purposes of estimating the number of shares of common stock to be included in this registration statement, we calculated a good faith estimate of the number of shares of our common stock that we believe will be issuable upon conversion of the Convertible Notes and upon exercise of the Warrants to account for market fluctuations, and antidilution and price protection adjustments, respectively. Should the conversion ratio result in our having insufficient shares, we will not rely upon Rule 416, but will file a new registration statement to cover the resale of such additional shares should that become necessary. In addition, should a decrease in the exercise price as a result of an issuance or sale of shares below the then current market price result in our having insufficient shares, we will not rely upon Rule 416, but will file a new registration statement to cover the resale of such additional shares should that become necessary.

(2) Includes a good faith estimate of the shares underlying the Convertible Notes to account for market fluctuations.

(3) Estimated solely for purposes of calculating the registration fee in accordance with Rule 457(c) under the Securities Act of 1933, using the last sale price of $.005 per share as reported on the OTC Bulletin Board on February 7, 2005.

(4) Includes a good faith estimate of the shares underlying Warrants exercisable at $.001 per share to account for antidilution and price protection adjustments.

(5) Estimated solely for purposes of calculating the registration fee in accordance with Rule 457(g) under the Securities Act of 1933, using the exercise price of $.001.

(6) Estimated by dividing the remaining unpaid principal amount of $1,844,038 on the 2004 Convertible Notes by $.0025, a good faith estimate of the conversion price, based on the applicable percentage of 50% of the last sale price of $.005 per share as reported on the OTC Bulletin Board on February 7, 2005. Effective May 2, 2006, the Registrant registered 78,947,369 shares issuable on conversion of the 2004 Convertible Notes. This registration statement covers the resale of additional shares that may be necessary due to a decrease in the conversion price to reflect the current and anticipated market price of the common stock, no par value.

The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.

Preliminary Prospectus
Subject To Completion, dated February 14, 2006

PROSPECTUS

2,000,000,000 Shares

Common Stock, no par value

This prospectus relates to the resale by the Selling Shareholders of up to 2,000,000,000 shares of our common stock, including up to 1,200,000,000 shares of common stock underlying the 2006 Secured Callable Convertible Notes in the principal amount of $3,000,000 (the “2006 Convertible Notes”), up to 90,000,000 shares issuable upon the exercise of the related 2006 Common Stock Purchase Warrants (the “2006 Warrants”), and up to 710,000,000 shares of common stock underlying the 2004 Secured Callable Convertible Notes in the outstanding principal amount of $1,844,838 as of February 7, 2006 (the “2004 Convertible Notes”). The 2006 Convertible Notes and the 2004 Convertible Notes are hereinafter collectively referred to as the “Convertible Notes.” The Convertible Notes are convertible into our common stock at the lower of $0.005 or 50% of the average of the three lowest intraday trading prices for the common stock on a principal market for the 20 trading days before the conversion date. The Selling Shareholders may sell common stock from time to time in the principal market on which the stock is traded at the prevailing market price or in negotiated transactions. Our common stock trades on the OTC Bulletin Board under the symbol "BANY." On February 10, 2006, the last reported sale price was $.01.

The mailing address and the telephone number of our principal executive office is Suite 500, 1925 Century Park East, Los Angeles, CA 90067-2700, 1-800-808-0899.

Investing in our common stock involves significant risks. Please see "Risk Factors" beginning on page 3.

The information in this prospectus is not complete and may be changed. The Selling Shareholders identified in this prospectus may not sell these securities until the registration statement filed with the Securities and Exchange Commission, of which this prospectus is a part, is declared effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

You should rely only on the information contained in this prospectus. We have not authorized anyone to provide you with information different from that contained in this prospectus.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is accurate or complete. Any representation to the contrary is a criminal offense.

, 2006.

TABLE OF CONTENTS

Prospectus Summary	2

Risk Factors	3

Special Note Regarding Forward-Looking Statements	9

Use of Proceeds	10

Market For Common Equity and Related Stockholder Matters	10

Capitalization	10

Management's Discussion and Analysis of Financial Condition and Results of Operations	11

Description of Business	13

Executive Compensation	16

Management	17

Principal Shareholders	21

Certain Relationships and Related Transactions	21

Selling Shareholders	25

Plan of Distribution	27

Description of Capital Stock	29

Legal Matters	29

Experts	30

Where You Can Find More Information	30

Index to Consolidated Financial Statements	F-i

PROSPECTUS SUMMARY

This summary highlights some information from this prospectus. Because it is a summary, it necessarily does not contain all of the information necessary to your investment decision. To understand this offering fully, you should read carefully the entire prospectus.

The Company

We are a holding company focused on investing in and building a network of subsidiaries engaged in diagnostic imaging, the franchising of Chiropractic USA branded chiropractic clinics, providing practice development training and assistance to chiropractors, and in offering franchise support and related services to franchisees. As used herein, the terms “Our,” “Us,” “We” and “the Company” collectively refer to Banyan and its one majority-owned subsidiary, Chiropractic USA, Inc., a Colorado corporation (“Chiropractic USA”), and its four wholly-owned subsidiaries: Franchise Support Network, Inc.,

(“Franchise Support Network”), incorporated pursuant to the laws of the province of Alberta, Canada, Banyan Financial Services, Inc., a Colorado corporation, Diagnostic USA, a Colorado corporation, Southern Diagnostics, Inc., a Colorado corporation, and Southern Health Care, Inc., a Colorado corporation.

The Offering

Common stock offered by selling security holders	2,000,000,000(1)
Common stock outstanding prior to this offering	184,367,611
Common stock outstanding following this offering if all shares are sold	2,184,367,611 (1)(2)

Use of Proceeds

All proceeds of this offering will be received by Selling Shareholders for their own accounts.

Risk Factors

You should read the "Risk Factors" section beginning on page 3, as well as other cautionary statements throughout this prospectus, before investing in shares of our common stock.

___________________

(1) Includes a good faith estimate of the shares issuable upon conversion of the Convertible Notes and exercise of Warrants, based on current market prices. Because the number of shares of common stock issuable upon conversion of the Convertible Notes is dependent in part upon the market price of the common stock prior to a conversion, the actual number of shares of common stock that will be issued upon conversion will fluctuate daily and cannot be determined at this time. Under the terms of the Convertible Notes, if the Convertible Notes had actually been converted on February 7, 2006, the conversion price would have been $ .0025.

RISK FACTORS

An investment in our common stock involves a high degree of risk. In addition to the other information in this prospectus, you should carefully consider the following risk factors before deciding to invest in shares of our common stock. If any of the following risks actually occurs, it is likely that our business, financial condition and operating results would be harmed. As a result, the trading price of our common stock could decline, and you could lose part or all of your investment.

Risks Related to Our Business

We have no history of profit, have incurred significant losses, expect continued losses and may never achieve profitability. If we continue to incur losses, we may have to curtail our operations, which may prevent us from successfully franchising Chiropractic USA clinics.

We have no history of profit, have incurred significant losses and expect continued losses. Historically, we have relied upon cash from financing activities to fund all of the cash requirements of our activities and have incurred significant losses and experienced negative cash flow. As of December 31, 2004, we had an accumulated deficit of $11,747,817. As of September 30, 2005, we had an accumulated deficit of $15,131,055. For the year ended December 31, 2004, we incurred a loss from continuing operations of $2,287,282 and a net loss of $2,459,928 and for our nine months ended September 30, 2005, we incurred a net loss of $ 3,383,238. We cannot predict when we will become profitable or if we ever will become profitable, and we may continue to incur losses for an indeterminate period of time and may never achieve or sustain profitability. An extended period of losses and negative cash flow may prevent us from franchising Chiropractic USA clinics and operating or expanding our business. As a result of our financial condition, our independent registered public accounting firm has issued a report questioning our ability to continue as a going concern.

Our significant losses have resulted principally from costs associated with our administrative activities. We expect our operating expenses to dramatically increase as a result of expansion. Since we have only recently acquired our diagnostic imaging business, begun development of our chiropractic franchise system, and have little operating history and revenue, we cannot assure you that our business will ever become profitable or that we will ever generate sufficient revenue to meet our expenses and support our planned activities. Even if we are able to achieve profitability, we may be unable to sustain or increase our profitability on a quarterly or annual basis.

Our independent registered public accounting firm has issued a report questioning our ability to continue as a going concern. This report may impair our ability to raise additional financing and adversely affect the price of our common stock.

The report of our independent registered public accounting firm contained in our financial statements includes a paragraph that explains that we have incurred significant losses and have a working capital deficit, and that these conditions raise substantial doubt about our ability to continue as a going concern. Reports of independent registered public accounting firms questioning a company's ability to continue as a going concern are generally viewed unfavorably by analysts and investors. This report may make it difficult for us to raise additional debt or equity financing necessary to continue the franchising of Chiropractic USA clinics. We urge potential investors to review this report before making a decision to invest in us.

Without substantial additional financing, we may be unable to achieve the objectives of our current business strategy, which could force us to delay, curtail or eliminate our product and service development programs.

We require additional financing to pay the costs of franchising Chiropractic USA clinics, meet payroll costs, and other debts and obligations. If we are unable to obtain this financing, we could be forced to delay or entirely abandon our franchising of Chiropractic USA clinics. In addition, our inability to obtain financing could have such a material adverse effect on our business, prospects, results of operations or financial condition, that we may be forced to restructure, file for bankruptcy, sell assets or cease operations entirely, any of which could jeopardize an investment in our common stock.

We need and may be unable to obtain additional financing on satisfactory terms, which may require us to accept financing on burdensome terms that may cause substantial dilution to our shareholders and impose onerous financial restrictions on our business.

We require additional financing. Deteriorating global economic conditions may cause prolonged declines in investor confidence in and accessibility to capital markets. Future financing may not be available on a timely basis, in sufficient amounts or on terms acceptable to us. This financing may also dilute existing shareholders' equity. Any debt financing or other financing of securities senior to our common stock will likely include financial and other covenants that will restrict our flexibility. At a minimum, we expect these covenants to include restrictions on our ability to pay dividends on our common stock. Any failure to comply with these covenants would have a material adverse effect on our business, prospects, financial condition and results of operations because we could lose any then-existing sources of financing and our ability to secure new sources of financing may be impaired.

Our default on the repayment of the Convertible Notes held by certain security holders could have a material and adverse effect on our business, prospects, results of operations or financial condition.

Unpaid principal and accrued and unpaid interest on our Convertible Notes becomes immediately due and payable upon the occurrence of an event of a default. The events of default under the Convertible Notes are similar to those customary for convertible debt securities, including breaches of material terms, failure to pay amounts owed, delisting of our common stock from the OTC Bulletin Board or failure to comply with the conditions of listing on the OTC Bulletin Board. If we default on our obligations under the Convertible Notes, we may be required to immediately repay the outstanding principal amounts of the Convertible Notes and any accrued and unpaid interest. The cash required to repay such amounts would likely have to be taken from our working capital. Since we rely on our working capital to sustain our day to day operations and the franchising of Chiropractic USA clinics, a default on the convertible debentures could have a material and adverse effect on our business, prospects, results of operations or financial condition.

We rely heavily on our management, and the loss of their services could materially and adversely affect our business.

Our success is highly dependent upon the continued services of key members of our management, including our Chairman of the Board and Chief Executive Officer, Michael J. Gelmon, and our President and Chief Financial Officer, Cory H. Gelmon. The loss of Messrs. Gelmon could have a material adverse effect on us because each of these individuals has experience and skills upon which we draw heavily in our day-to-day operations, strategic planning and franchising activities. The development and franchising of Chiropractic USA clinics is largely dependent upon the skills and efforts of Messrs. Gelmon. Although we have entered into employment agreements with Messrs. Gelmon, we cannot assure the continued services of these key members of our management team.

We have a limited operating history in franchising Chiropractic USA clinics of approximately two years and very limited operating experience; therefore, regardless of the viability or market acceptance of Chiropractic USA clinics, we may be unable to achieve profitability or realize our other business goals.

We have not generated any profit from franchising Chiropractic USA clinics and have not commenced any widespread collection of franchise fees and royalties that we anticipate will be required for successful continuation in business. Our success will depend in large part on our ability to deal with the problems, expenses and delays frequently associated with bringing a new franchise concept to market, one with the complexities of doctors, patients and their insurers. Because we have little experience in franchising Chiropractic USA clinics, we may be unable to achieve a critical mass of sufficient market acceptance. Consequently, we may be unable to achieve profitability or realize our other business goals.

Although we do not have any competition now, other companies with greater resources and operating experience may enter the market for franchising chiropractic clinics.

These companies could successfully compete with us and negatively affect the franchising of Chiropractic USA clinics and our opportunity to achieve profitability. Some of our potential customers, namely chiropractors, may decide to develop their own brand that directly competes with our Chiropractic USA clinics. Although we believe that our Chiropractic USA clinics will be competitive in the marketplace, we cannot assure you that these or other companies with greater experience and greater resources than us will not negatively affect our business prospects and impair our ability to achieve profitability.

Our failure to manage growth effectively could impair our business.

We do not currently have profit-generating operations but our strategy envisions a period of rapid growth that may impose a significant burden on our administrative and operational resources. Our ability to effectively manage growth will require us to substantially expand the capabilities of our administrative and operational resources and to attract, train, manage and retain qualified personnel. There can be no assurance that we will be able to do so. If we are unable to successfully manage our growth, our business, prospects, results of operations and financial condition could be materially and adversely affected.

Because we believe that proprietary rights are material to our success, misappropriation of those rights or claims of infringement or legal actions related to intellectual property could adversely impact our financial condition.

We have chosen to retain the proprietary rights associated with our system predominantly as trade secrets. Although we currently rely to a great extent on trade secret protection for much of our proprietary information, we cannot assure you that our means of protecting our proprietary rights will be adequate or that our competitors will not independently develop comparable or superior proprietary information or obtain unauthorized access to our proprietary information.

RISKS RELATED TO THIS OFFERING

Shares of our common stock eligible or to become eligible for public sale could adversely affect our stock price and make it difficult for us to raise additional capital through sales of equity securities.

As of February 13, 2006, we had 184,367,611 shares of common stock outstanding. See Capitalization. Approximately 150,000,000 of the outstanding shares were unrestricted under the Securities Act of 1933. As of that date, we also had outstanding options, warrants, promissory notes and convertible debentures that were exercisable for or convertible into approximately 2,000,000,000 shares of common stock. Sales of a substantial number of shares of our common stock in the public market, or the perception that sales could occur, could adversely affect the market price of our common stock. Any adverse effect on the market price of our common stock could make it difficult for us to raise additional capital through sales of equity securities at a time and at a price that we deem appropriate.

Conversion or exercise of our outstanding derivative securities could substantially dilute your investment because the conversion and exercise prices of those securities and/or the number of shares of common stock issuable upon conversion or exercise of those securities are subject to adjustment.

We have issued convertible notes, warrants and options that are convertible or exercisable at prices that are subject to adjustment due to a variety of factors, including fluctuations in the market price of our common stock and the issuance of securities at an exercise or conversion price less than the then-current exercise or conversion price of those notes or warrants. As of February 7, 2006, the closing price of

a share of our common stock on the OTC Bulletin Board was $.005. On that date, our Convertible Notes, Warrants and stock options outstanding with adjustable conversion and/or exercise prices were convertible or exercisable into approximately 2,000,000, 000 shares of our common stock. The number of shares of common stock that these adjustable securities ultimately may be converted into or exercised for could prove to be greater than this amount if the market price of our common stock declines. You could, therefore, experience substantial dilution of your investment as a result of the conversion or exercise of our outstanding derivative securities.

The applicable conversion price of our Convertible Notes issued to the Selling Shareholders is variable and does not have a lower-limit, therefore the dilutive effect to our existing security holders is theoretically limitless. However, because the variable conversion price of the Convertible Notes has an upper limit, an increase in the trading price of a share of our common stock will result in a limited benefit to existing security holders with respect to the conversion of these notes.

The holders of certain of our Convertible Notes may elect to receive payment for accrued and unpaid interest on our Convertible Notes in shares of our common stock based on the conversion price and on the same terms described above with respect to conversions of the principal portion of these Convertible Notes. As a result of conversions of the principal or interest portion of our Convertible Notes and related sales of our common stock by the holders of our Convertible Notes, the market price of our common stock could be depressed, thereby resulting in a significant increase in the number of shares issuable upon conversion of the principal and interest portions of these Convertible Notes. You could, therefore, experience substantial dilution of your investment as a result of the conversion of the principal or interest portions of our Convertible Notes.

If our security holders engage in short sales of our common stock, including sales of shares to be issued upon conversion or exercise of derivative securities, the price of our common stock may decline.

Selling short is a technique used by a shareholder to take advantage of an anticipated decline in the price of a security. A significant number of short sales or a large volume of other sales within a relatively short period of time can create downward pressure on the market price of a security. The decrease in market price would allow holders of our derivative securities that have conversion or exercise prices based upon a discount on the market price of our common stock to convert or exercise their derivative securities into or for an increased number of shares of our common stock. Further sales of common stock issued upon conversion or exercise of our derivative securities could cause even greater declines in the price of our common stock due to the number of additional shares available in the market, which could encourage short sales that could further undermine the value of our common stock. You could, therefore, experience a decline in the value of your investment as a result of short sales of our common stock.

Our current financing arrangements could prevent our common stock from being listed on Nasdaq or other principal markets.

Nasdaq and other principal markets require that, to be eligible for inclusion in the stock market, a company's common stock have a specified minimum bid price per share. Convertible Note financings, especially those with variable conversion prices with low or no low-price limits, characteristically exert downward pressure on the market for a company's common stock. This pressure, if applied against the market for our common stock, may prevent our common stock from being listed on Nasdaq or other principal markets.

Our common stock price is subject to significant volatility, which could result in substantial losses for investors and in litigation against us.

The stock market as a whole and individual stocks historically have experienced extreme price and volume fluctuations, which often have been unrelated to the performance of the related corporations. During the period from January 1, 2006 through February 10, 2006, the high and low closing bid prices of our common stock were $.009 and $.0035, respectively. The market price of our common stock may exhibit significant fluctuations in the future response to various factors, many of which are beyond our control and which include:

(a) variations in our quarterly operating results, which variations could result from, among other things, changes in the needs of one or more of our customers;

(b) changes in market valuations of similar companies and stock market price and volume fluctuations generally;

(c) economic conditions specific to the industries in which we operate;

(d) announcements by us or our competitors of new or enhanced products, technologies or services or significant contracts, acquisitions, strategic relationships, joint ventures or capital commitments;

(e) regulatory developments;

(f) additions or departures of key personnel; and

(g) future sales of our common stock or other debt or equity securities.

If our operating results in future quarters fall below the expectations of market makers, securities analysts and investors, the price of our common stock likely will decline, perhaps substantially. In the past, securities class action litigation often has been brought against a company following periods of volatility in the market price of its securities. We may in the future be the target of similar litigation. Securities litigation could result in substantial costs and liabilities and could divert management's attention and resources.

Consequently, the price at which you purchase shares of our common stock may not be indicative of the price that will prevail in the trading market. You may be unable to sell your shares of common stock at or above your purchase price, which may result in substantial losses to you.

Because we are subject to the "Penny Stock" rules, the level of trading activity in our stock may be reduced.

Broker-dealer practices in connection with transactions in "penny stocks" are regulated by penny stock rules adopted by the Securities and Exchange Commission. Penny stocks, like shares of our common stock, generally are equity securities with a price of less than $5.00 (other than securities registered on certain national securities exchanges or quoted on NASDAQ). The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document that provides information about penny stocks and the nature and level of risks in the penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction, and, if the broker-dealer is the sole market maker, the broker-dealer must disclose this fact and the broker-dealer's presumed control over the market, and monthly account statements showing the market value of each penny stock held in the customer's account. In addition, broker-dealers who sell these securities to persons other than established customers and "accredited investors" must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written agreement to the transaction.

Consequently, these requirements may have the effect of reducing the level of trading activity, if any, in the secondary market for a security subject to the penny stock rules, and investors in our common stock may find it difficult to sell their shares.

Because our stock is not listed on a national securities exchange, you may find it difficult to dispose of or obtain quotations for our common stock.

Our common stock trades under the symbol "BANY" on the OTC Bulletin Board. Because our stock trades on the OTC Bulletin Board rather than on a national securities exchange, you may find it difficult to either dispose of, or to obtain quotations as to the price of our common stock.

Our preferred stock may delay or prevent a takeover of the company, possibly preventing you from obtaining higher stock prices for your shares.

Our board of directors has the authority to issue up to 100,000,000 shares of preferred stock and to fix the rights, preferences, privileges and restrictions, including voting rights of those shares, without any further vote or action by our shareholders. The rights of the holders of our common stock are subject to the rights of the holders of our outstanding preferred stock and will be subject to, and may be adversely affected by, the rights of the holders of any preferred stock that we may issue in the future. The issuance of preferred stock, while providing desired flexibility in connection with possible acquisitions and other corporate purposes, could have the effect of making it more difficult for a third party to acquire a majority of our outstanding voting stock, which would delay, defer or prevent a change in control of the company. Furthermore, preferred stock may have other rights, including economic rights senior to the common stock, and, as a result, the issuance of preferred stock could adversely affect the market value of our common stock.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This prospectus contains forward-looking statements, including among others:

(a) our business development activities;

(b) our business strategy for establishing a presence in the chiropractic and diagnostic imaging markets;

(d) our ability to distinguish ourselves from our current and future competitors.

We use words like "believe," "expect," "may," "will," "could," "seek," "estimate," "continue," "anticipate," "intend," "future," "plan" or variations of those terms and other similar expressions, including their use in the negative, to identify forward-looking statements. You should not place undue reliance on these forward-looking statements, which speak only as to our expectations as of the date of this prospectus. These forward- looking statements are subject to a number of risks and uncertainties, including those identified under "Risk Factors" and elsewhere in this prospectus. Although we believe that the expectations reflected in these forward-looking statements are reasonable, actual conditions in the chiropractic, franchising, and diagnostic imaging businesses, and actual conditions and results in our business, could differ materially from those expressed in these forward-looking statements. In addition, none of the events anticipated in the forward-looking statements may actually occur. Any of these different outcomes could cause the price of our common stock to decline substantially. Except as required by law, we undertake no duty to update any forward-looking statement after the date of this prospectus, either to conform any statement to reflect actual results or to reflect the occurrence of unanticipated events.

USE OF PROCEEDS

We will not receive any of the proceeds from the sale of the shares of common stock offered under this prospectus by the selling security holders. Rather, the selling security holders will receive those proceeds directly.

MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

Our Common Stock is traded on the OTC Bulletin Board under the symbol "BANY". The following are the high and low bid prices for each quarter within the last two fiscal years and the current fiscal year to date:

Year	Quarter	Bid Price
Year	Quarter	High	Low
2003	First	$.33	$.23
	Second	$.27	$.15
	Third	$.20	$.09
	Fourth	$.19	$.10
2004	First	$.24	$.10
	Second	$.28	$.04
	Third	$.12	$.02
	Fourth	$.045	$.005
2005	First	$.009	$. 0035
2005	Second	$.	$.

As of December 31, 2005 there were approximately 500 record holders of common stock. This does not reflect an estimated 1,400 shareholders who hold their shares in street name.

No dividends were declared since December 31, 2002. We presently intend to retain our earnings to fund development and our business. Decisions concerning dividend payments in the future will depend on income and cash requirements. Holders of common stock are entitled to receive such dividends as may be declared by our Board of Directors. There are no contractual restrictions on our ability to pay dividends to our shareholders.

CAPITALIZATION

The following table sets forth our capitalization as of September 30, 2005. You should read this information together with our consolidated financial statements and the notes relating to those statements appearing elsewhere in this prospectus. The table excludes shares that were issuable upon conversion or exercise of outstanding convertible notes, warrants and options.

Cash	$	2060

Working capital deficit	$	959,223

Current liabilities	$	1,346,551

Convertible Notes	$	1,106,224

Shareholders’ equity

Preferred stock, no par value, 100,000,000 shares
authorized

Common stock, no par value, 500,000,000
Shares authorized; 110,091,898 shares issued and
outstanding	$	14,856,835

Deferred Compensation Costs	$	(234,979	)

Common stock to be issued	$	81,205

Accumulated deficit	$	(15,131,055	)

Total shareholders’ (deficit)	$	(427,994	)

Total capitalization	$	2,024,781

MANAGEMENTS’ DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

Plan of Operation for 2006

Liquidity and Capital Resources.

We expect to be in a positive cash flow position by the end of 2006 as a result of the acquisition of a diagnostic imaging business that we believe will generate positive cash flow and the rapid rise in our franchise revenue.

We entered into an agreement that provides $3,000,000 from the sale of convertible notes to an investment group. We received $2,150,000 in the first quarter of 2006 and expect to receive $850,000 over the remainder of 2006 from the sale of convertible notes. The first $2,000,000 was used to acquire our diagnostic imaging business. Most of the latter amount will be used as working capital to fund operations. In 2004 and 2005, we were provided $3,000,000 from the sale of convertible notes to this investment group, including $1,910,000 in 2005.

The investment group has already converted $1,155,162 in notes to stock. The aggregate outstanding principal amount of the convertible notes is $4,844,838 as of the date hereof. See Certain Relationships and Related Transactions-Securities Purchase Agreements. We believe without assurance that the investment group will convert the rest of the notes to stock. However, the rate of conversion has become negligible as a result of the decrease in our stock price, to which the rate of conversion is tied. If these trends persist, all of the remaining debt may not be converted when the convertible notes begin to come due in the fourth quarter of 2006. We intend to refinance, extend or otherwise restructure the due date of this debt before it becomes due. In the event we are unable to refinance, extend or otherwise restructure this debt, we may have to file for protection under the federal bankruptcy laws and we may be unable to continue in operation as a going concern.

Revenue has risen with the advent of our diagnostic imaging business and the increase in the number of franchises. However, it is likely that additional liquidity and capital resources will be necessary to defray our ongoing expenses.

We now have more than eighty franchised locations. During 2005, we were able to increase the number of franchises primarily by breaking into the Phoenix, Arizona market. This is significant, as it gives us our first concentrated market in the country in which a large number of clinics will be operated and marketed under the Chiropractic USA brand. This will serve as an example and a catalyst for practitioners in other markets that are considering becoming Chiropractic USA franchisees.

Effective December 31, 2004 we disposed of the former Company-owned chiropractic clinics in Louisiana that had a loss of $414,833 in 2004 by selling their assets and discontinuing their operations. The assets disposed of, mainly accounts receivable, were valued at approximately $926,000. As a result of the disposition, there was a significant decrease in the number of employees. A consultant, six chiropractors and ten support staff from these clinics are no longer on our payroll. We gained $242,187 on the sale. The disposition of the clinics eliminates an operation that was being supported by franchise operations. Under deferred payment terms of a ten-year note issued by the purchaser, we expect to receive more than $100,000 in principal and interest for 2006 and the remaining term of the note. These clinics also signed franchise agreements that are expected to generate significant royalties.

In 2005 we formed a joint venture with a diagnostic imaging business. We acquired the customer base of another diagnostic imaging business from the owners for $700,000 that we transferred to our joint venture. During the first quarter of 2006, we acquired a diagnostic imaging business that is now operated as a wholly owned subsidiary. The acquisition increased the number of employees by approximately forty-five.

Our plan of operation for the remainder of fiscal 2006 is as follows:

To develop the diagnostic imaging business that has generated a positive cash flow;

To increase the number of franchises by direct marketing of franchises and recruiting area developers;

To increase fees and royalty income from existing and new franchises;

To satisfy outstanding claims of approximately $500,000 exclusive of interest and costs;

To convert the Convertible Notes to equity; and,

To obtain additional equity financing.

To date our operations have not been self-sustaining. Our independent registered public accounting firm issued a report to the effect that certain conditions raise substantial doubt about our ability to continue as a going concern because we have incurred net losses during 2004 and had a stockholders’ deficit and working capital deficiency at year end. We continue to incur net losses and to have a stockholders’ deficit and a working capital deficiency. Should we be unable to implement our plan of operation, our expansion plans may be curtailed, and we may not be able to continue in operations.

Financial condition at September 30, 2005 and 2004

September 30, 2005. Stockholders’ deficit was $427,994 and we had a working capital deficiency of $959,223. Principal internal sources of liquidity in 2005 included the sale of $1,910,000 in convertible notes, $156,956 from selling shares to investors and $818,550 in revenue from operations.

September 30, 2004. Stockholders deficit was $830,703 and working capital deficiency was $1,060,315. Principal sources of liquidity in 2004 included $1,058,204 in revenue from patient services,

$873,227 from selling shares to investors and $336,244 in revenue from franchised operations. As a result of the disposition of the Company-owned clinics we no longer have revenue from patient services.

Results of operation for third quarter of 2005 and 2004

Loss from operations decreased to $536,621 in 2005 from $772,951 in 2004.

Third quarter revenue increased to $376,457 in 2005 from $152,490 in 2004. The diagnostic imaging business produced $146,407 in revenue in the third quarter. Revenue from franchised operations increased to $230,050 in 2005 from $152,490 in 2004. This was caused by the large increase in the number of Chiropractic USA franchises as we rolled out our franchise program and rapidly built up our brand. Revenue from franchised operations was $60,180 less than in the second quarter. The business of our Louisiana franchisees was interrupted by hurricanes.

Selling, general and administrative expenses decreased in the third quarter to $796,119 in 2005 from $872,201 in 2004.

In the third quarter we also incurred interest expense of $494,964, mostly from the conversion of convertible notes. As a result, net loss from continuing operations increased from $773,861 in 2004 to $1,031,784 in 2005.

We had losses from the discontinued operations of the Company-owned clinics of $67,544 in 2004. Giving effect to the discontinued operations, overall net loss for the quarter increased from $841,405 in 2004 to $1,031,784 in 2005.

Results of operation in 2004 and 2003

Revenue from franchised operations increased to $465,729 in 2004 from $54,138 in 2003. This was caused by the large increase in the number of Chiropractic USA franchises as we rolled out our franchise program and rapidly built up our brand. We expect this trend to continue.

Selling, general and administrative expenses decreased from $3,335,478 in 2003 to $2,566,783 in 2004. In 2004, $1,134,395 of these expenses consisted of non-cash compensation expenses: $339,075 recorded as a result of the sale of shares to franchisees and area representatives at less than fair market value, $382,370 representing the value of shares issued for services, and $412,950 recorded in connection with stock options granted to franchisees, area developers, consultants and investors. These figures were significantly greater in 2003: $2,238,529, $1,397,590, $71,500 and $769,439, respectively. General and administrative expenses, particularly management salaries, are expected to increase in 2006 as a result of additions to management and increases in compensation to our chief executive officer and our president and chief financial officer.

As a result of the increase in revenue and decrease in selling, general and administrative expenses, net loss from continuing operations decreased from $3,440,785 in 2003 to $2,287,282 in 2004.

We had losses from the discontinued operations of the Company-owned clinics of $414,833 and $478,588 in 2004 and 2003, respectively. In 2004, we realized a $242,187 gain on the sale of the assets of this business. Giving effect to the discontinued operations, overall net loss decreased from $3,919,373 in 2003 to $2,459,928 in 2004.

DESCRIPTION OF BUSINESS

We are a holding company focused on investing in and building a network of subsidiaries engaged in diagnostic imaging, the franchising of Chiropractic USA branded chiropractic clinics, providing practice development training and assistance to chiropractors, and offering franchise support and related services to franchisees. We currently have sixty employees including three in management, forty-six in diagnostic imaging, six in franchise sales and support operations, and five in accounting (including three part-time) and administration.

Diagnostic USA. Diagnostic USA is our diagnostic imaging business, offering ultra sound imaging and Nerve Conduction Velocity Testing (“NCVT”) through our franchisees and health care professionals to their patients. NCVT measures the transmission of nerve impulses through the body, identifies problems in the nervous system, and helps to substantiate the benefit and cost of treatment to patients and their insurers. We believe these are logical services to offer in chiropractic clinics and through other health care professionals.

Diagnostic USA sets up blocks of patient testing appointments and then arranges for one of our certified neurological or radiological technicians to bring test equipment to the doctors’ offices and perform the scheduled tests. The business, which is based in Boca Raton, Florida, performs approximately ten thousand tests annually and has approximately forty-five employees.

To enter the diagnostic imaging business, on May 25, 2005 we purchased all of the stock of Nationwide Diagnostic Solutions, Inc., an Arizona corporation based in Tempe, Arizona (“Nationwide”), from Dr. Jeff and Constance Rebarcak (the “Rebarcaks”), the founders, sole shareholders and operators of Nationwide for $700,000. Prior to the closing, the accounts receivable of Nationwide were assigned to the Rebarcaks. We transferred the remaining asset of Nationwide, the patronage of its customer base, to our new subsidiary Southern Diagnostics, Inc., a Colorado corporation (“Southern”). Southern contributed the customer accounts to Premier SD, LLC, an Alaska limited liability company based in Boca Raton, Florida for 20% of all fees collected by Premier SD, LLC subject to certain adjustments under an operating agreement between Southern and Premier Health Services, LLC, a Delaware limited liability company, that manages Premier’s diagnostic imaging business.

We recently decided to purchase substantially all of the outstanding equity securities of the constituent entities of Premier’s diagnostic imaging business, Premier Medical Group, Inc., Premier Imaging, LLC and Premier Health Services, LLC, (hereinafter collectively referred to as “Premier”), from Dr. Brad Goldstein (“Dr. Goldstein”) the founder, owner and operator of Premier. As a result of the acquisition, all of the assets and liabilities of the business have been transferred to us. See Certain Relationships and Related Transactions – Premier Acquisition. The source of funds for the acquisition was the securities purchase agreement described herein in Certain Relationships and Related Transactions -- Securities Purchase Agreements -- 2006 Securities Purchase Agreement.

Premier has also developed the VT3000, a NCVT device. The Food and Drug Administration granted Premier marketing approval for the VT3000 on October 27, 2005. We also to arrange with third parties to manufacture the device and to market it to chiropractors and other health care professionals. With the VT3000 is installed in their offices, Chiropractors can perform NCVT testing when the patient is at their office without scheduling a visit from on technicians. Our technicians will be able to supervise the testing via the Internet and telephone. We believe that this protocol will increase the number of tests we can perform and related revenue.

Chiropractic USA. There are approximately 80,000 chiropractors in the United States and Canada. Approximately 2,000 new graduates enter the field each year. This year, an estimated 20,000,000 Americans are expected to visit a chiropractor, and expenses for the treatment of lower back pain are expected to exceed approximately $50 billion. The aging of the population, continued population growth, advanced chiropractic treatments, increased health care, and greater health consciousness are trends that assure the chiropractic industry a future of expanding services. Despite the size and potential of the chiropractic market, there had been no national brand.

Management believes these factors have created a unique and significant business opportunity: to establish the first nationally franchised brand in the burgeoning chiropractic market and to provide ancillary services to chiropractors. Chiropractic USA was formed to develop and franchise Chiropractic USA brand chiropractic clinics throughout North America under the Chiropractic USA trademark and uniform operating systems and practices.

We have embarked on two main development strategies: direct marketing of franchises and recruiting area developers to increase the number of franchises in exclusive territories. In the middle of 2003, we completed development of our uniform franchise offering materials and began the rollout of our franchising program through direct marketing to existing practitioners and chiropractic students.

We are developing our network of franchised clinics through conversion of established practices to franchised Chiropractic USA brand clinic locations and franchising new practitioners. Established practices that convert receive a corporate identity -- logos, banners, name recognition, marketing capability, a uniform operating and business format, practice development services, and other services available through us. These conversions will establish a strong basis for our operations and enable us to build up our brand rapidly. We have also been marketing to new practitioners and recently graduated chiropractic students. As additional services to new practitioners, we offer site selection consultation, lease negotiation, practice design and other services.

We have entered into approximately 80 franchise agreements. Our franchise agreements provide for payment of percentage royalties, contribution to a national advertising fund, and charges for additional services selected by the franchisee. New practitioners pay a franchise fee in addition to these charges. Some franchise agreements cover more than one location.

We recruit area developers from all regions of the country. An area developer is responsible for increasing the number of Chiropractic USA locations within an exclusive territory. An area developer receives a portion of the percentage royalty we collect from the territory. We have entered into thirteen area representative agreements in twenty states. Typically, an area developer enters into one or more franchise agreements.

During the latter half of 2002, we acquired a chain of three clinics in Louisiana, which were re-branded under Chiropractic USA. This allowed us to implement our practice methods in our own clinics and commence the chain/brand building segment of our business plan. These clinics served as a flagship or role model for the Chiropractic USA chain. See Certain Relationships and Related Transactions—Acquisition of Corporate Clinics.

On April 8, 2005, we signed an agreement effective December 31, 2004 to sell the three clinics for $1,000,000 to LSI Group, LLC, a Louisiana limited liability company. As payment, LSI assumed $175,493 of the liabilities associated with the business and issued us a promissory note for $824,507 payable in equal monthly installments of principal and interest at 5% for ten years beginning September 1, 2005. The note is secured by substantially all of the assets of the business. LSI is current in paying its obligations under this note.

In December 2002, we entered into an agreement in principle with recognized Chiropractic Coach Dr. CJ Mertz to assist us with the development of our franchising. Dr. Mertz has operated The Waiting List Practice Chiropractic Training Organization (www.teamwlp.com) and its predecessors for approximately 20 years. According to Team WLP, Dr. Mertz has trained with thousands of chiropractors and has visited over one thousand private practices worldwide, Team WLP has successfully built more practices profitably than any other coaching program and Dr. Mertz has received numerous awards from the chiropractic profession. We utilize Team WLP in our franchise system to encourage maximum potential for our franchisees. Additionally, Dr. Mertz will have a significant role in the growth of our network as well as strategic planning and execution. Under the agreement Dr. Mertz owns a minority interest in our subsidiary Chiropractic USA and up to one-quarter of our royalties on franchises he introduces to us.

On May 7, 2001, Banyan Corporation entered into three contracts with our Chief Executive Officer and our Chief Financial Officer in connection with the repositioning of our business into the chiropractic market: an Offer to Purchase (Intellectual Property), an Offer to Purchase Franchise Support Network, Inc. and, Management Agreements with each of these officers (the “Management Agreements”). See Management -- Directors and Executive Officers; Executive Compensation; and, Certain Relationships and Related Transactions – Chiropractic USA and Franchise Support Network Acquisitions.

Franchise Support Network. Franchise Support Network (“FSN”) is intended to be a dedicated support unit to assist the needs of practitioners who would like to be Chiropractic USA franchisees. It will offer such support services as business plan formulation, franchise agreement review and negotiation, assistance in site selection, lease review and negotiation, local marketing assistance, accounting services, and other ongoing services. We intend that Franchise Support Network will establish relationships with business consultants and accountants across North America in order to establish itself as a network of one-stop franchise consultants. Franchise Support Network has its principal place of business in Calgary, Alberta. As of the date hereof, significant operations have not commenced.

Banyan Financial Services. Banyan Financial Services is intended to be a specialty finance firm providing financing assistance, including start up capital, construction financing, equipment leasing, unsecured lines of credit, and refinancing for Chiropractic USA franchisees and others in the health care industry. The president of Banyan Financial Services is Mark Eric Bailey. Banyan Financial Services has its principal place of business in Cape May, New Jersey. As of the date hereof, significant operations have not commenced.

Description of Property

We have a trademark registered with the United States Patent and Trademark Office for the Chiropractic USA logo.

We sublease our executive offices in Los Angeles for a monthly rental. We lease 1,500 square feet of office space in Calgary, Alberta for $3,300 per month under a lease expiring May 2006

Legal Proceedings

On September 23, 2005, the Supreme Court of Alabama reversed dismissal of a case originally filed against the Company on January 8, 2004, in Mobile County, Alabama, by a former employee of a former subsidiary, Bruce Leithead. The complaint seeks money damages for breach of an alleged employment contract to issue 400,000 shares of common stock to the employee on termination and for his inability to exercise 400,000 options. The Company denies any liability and continues to vigorously defend this suit.

Six unsecured promissory notes in the aggregate principal amount of $210,700 together with accrued interest became due and payable on April 30, 2005. Four of the note holders threatened to commence legal proceedings. In July 2005 we entered into a settlement agreement and mutual release of claims with four note holders. In the settlement, we issued 2,454,767 shares to the designee of one of the note holders and their attorneys to satisfy $295,000 of the claims. To satisfy all other claims, we agreed to pay $310,000 with 16% interest to the note holders and the former attorney of one of the note holders in $15,000 monthly installments beginning September 15, 2005 until paid. The payment for October has not been made. On November 4, 2005, the District Court for the City and County of Denver, Colorado entered judgment in favor of the four note holders and against the Company for $290,000 plus interest at 22% and cost of collection, including attorney fees. On February 8, 2006 the Court ordered this judgment vacated.

On December 5, 2005, Lloyd Parrish, a former director of the Company, and his wife, Carol Parrish, filed suit in the District Court for El Paso County, Colorado. The complaint seeks money damages for failure to pay in full certain promissory notes in the aggregate principal amount of $86,587.50, plus accrued interest and costs, including attorney fees. The Company is vigorously defending this case. See Certain Relationships and Related Transactions — Loans.

MANAGEMENT

Directors and Executive Officers; Corporate Governance

Name	Age	Positions
Michael J. Gelmon	41	Chief Executive Officer and Director
Cory H. Gelmon	46	President, Chief Financial Officer, Secretary and Director
Marshall F. Wilmot	45	Chief Operating Officer

Our Board of Directors is comprised of three directors of one class. There is one vacancy on the Board of Directors. Each director is elected to hold office until the next annual meeting of shareholders and until his successor has been elected and qualified. Officers are elected annually by the Board of Directors and hold office until successors are duly elected and qualified.

Michael J. Gelmon and Cory H. Gelmon are brothers.

The following is a brief account of the business experience of each director and executive officer.

Michael J. Gelmon. Mr. Gelmon is an experienced franchising entrepreneur and executive as well as a real estate lawyer. He has been our Chief Executive Officer and a director since 2001. From 1993 through 1997, Mr. Gelmon was a founding shareholder, director, as well as head of acquisitions and real estate for Domino's Pizza of Canada Ltd., the Domino's Pizza master franchisor in Canada. He was an integral part of the team that was responsible for growing the Domino's Pizza chain to 200 stores throughout Canada. Since 1999 Mr. Gelmon has also practiced law with his brother in a law partnership, Britannia Law Firm. Mr. Gelmon received his Bachelor of Laws with honors from the University of London in 1988 and a Bachelor of Arts from the University of Calgary in 1988.

Cory H. Gelmon. During Cory H. Gellman’s seventeen-year career in franchising, he has been an owner, promoter, executive and a franchise lawyer. Mr. Gelmon has been our president and chief financial officer since 2001. Since 1999 Mr. Gelmon has also practiced law with his brother in a law partnership, Britannia Law Firm. From 1993 until 1997, he was chief operating officer and general counsel of Domino’s Pizza of Canada Ltd. Mr. Gelmon was largely responsible for growing the Domino's Pizza chain to 200 stores throughout Canada. He received his Bachelor of Laws with honors from the University of London in 1987 and a Bachelor of Arts from the University of Calgary in 1984.

Marshall F. Wilmot. Effective February 1, 2006, Mr. Wilmot has overall responsibility for the day-to-day operations of our subsidiaries Chiropractic USA and Diagnostic USA. In the past four years, he held several key positions, most recently as Vice President, Marketing, in the Forzani Group, Ltd., a publicly traded company based in Calgary, Alberta. Forzani Group is Canada’s largest sporting goods retailer with more than 500 corporate and franchised locations. For fiscal 2005, Forzani Group reported sales of $985,000,000 and net profits of $22,000,000 (figures are in Canadian dollars). Previously, Mr. Wilmot had a distinguished twelve-year career with Canadian Airlines International, Ltd., most recently as the Vice President, In-flight service. He received a Masters of Business Administration from Nyenrode Universiteit in the Netherlands in 1986, and a Bachelor of Commerce with a major in Finance from the University of Calgary in 1983.

Departure of Director

On November 18, 2005, Richard Doran submitted his resignation as a director effective September 30, 2005.

Committees of the Board of Directors

Audit Committee. We have no audit committee of the Board of Directors. We believe that the better practice is to form an Audit Committee. During 2004, we adopted an Audit Committee Charter that provides for an audit committee consisting of three or more directors, each of whom shall satisfy the independence, financial literacy and experience requirements of Section 10A of the Exchange Act and any other regulatory requirements. We need to expand our Board of Directors and make appropriate compensation arrangements with them. As of the date hereof we have not identified potential candidates. We intend to form the Audit Committee on or before July 31, 2006. Accordingly, there is no audit committee financial expert. We are exempt from the Securities and Exchange Commission requirements for a separate audit committee.

No Compensation Committee. We have no compensation committee of the Board of Directors. The entire board acts as our compensation committee. Transactions between the Gelmons, members of their immediate families and the entities they own and control and us are not conducted at arm's-length. These include their compensation arrangements set forth in Executive Compensation and the transactions set forth in Certain Relationships and Related Transactions below. The Gelmons without any independent authorization, review or oversight set the terms of these arrangements and transactions. There can be no assurance that the terms thereof are comparable to those that would be negotiated at arm's-length or otherwise fair and reasonable, despite the good faith belief of the Gelmons that they are.

Codes of Ethics

During 2004, we adopted a Code of Business Conduct and Ethics that addresses, among other things, conflicts of interest, corporate opportunities, confidentiality, fair dealing, protection and use of company assets, compliance with laws (including insider trading laws), and reporting of unethical behavior. The Code of Business Conduct and Ethics is applicable to our directors, officers and all employees.

In addition, we have adopted a Finance Code of Ethics that requires honest and ethical business conduct, full, accurate and timely financial disclosures, compliance with all laws, rules and regulations governing our business, and prompt internal reporting of any violations of the code. The Finance Code of Ethics is applicable to our Chief Executive Officer, Chief Financial Officer and all finance employees. We intend to satisfy the disclosure requirements under Item 10 of Form 8-K regarding any amendment to or waiver of the Code of Ethics with respect to our Chief Executive Officer, Chief Financial Officer, Chief Operations Officer, and persons performing similar functions, by posting such information on our web site.

EXECUTIVE COMPENSATION

Summary Compensation Table

The following table sets forth-certain information about the compensation paid to management during the 2003 through 2004 fiscal years:

	Annual Compensation			Long Term Compensation
Name and principal position	Year	Salary ($)	Other annual compensation ($)	Awards		Payouts	All other compensation ($)


				Restricted stock award(s) ($)	Securities underlying options/SAR (#)	LTIP payouts ($)



Michael Gelmon Chief Executive Officer and Director	2004 2003	$150,300* $120,000	- 0 - $12,000		2,500,000 1,000,000



Cory Gelmon President, Chief Financial Officer, Secretary and Director	2004 2003	$140,893* $120,000	- 0 - $12,000		2,500,000 1,000,000

* Includes payments for accrued and unpaid salaries in prior years.

No bonuses were awarded in 2003, 2004 or 2005.

Employment and Other Compensation-Related Agreements with Management

Our Management Agreements with the Gelmons, as amended, provide for payment of compensation of $210,000 per year, a bonus of five percent of the net income of Diagnostic USA payable annually, and a grant of stock options. The Management Agreements expire on March 31, 2008.

Our compensation agreement with Mr. Wilmot provides for a salary of $120,000 per year, an annual bonus of up to $180,000 based upon the pre-tax earnings of Diagnostic USA in excess of $1,700,000. For his services, we also issued 1,000,000 shares of stock and granted 5,000,000 options exercisable at $.06 per share for five years, of which 1,666,667 vest immediately and 1,666,666 will vest on the first and second anniversary of his employment.

We retained the Gelmons’ law partnership, the Britannia Law Firm, to serve as our general counsel and special Canadian counsel particularly in the areas of franchising, mergers and acquisitions, Canadian corporate law, real estate law, and other matters. The Company pays the Britannia Law Firm a monthly retainer of $15,000.

Equity Compensation Plan Information

On October 28, 2004 the Board of Directors adopted the 2004 Human Resources Incentive Plan (the "Incentive Plan") to provide incentive compensation to employees, directors, officers and others who serve us. The Incentive Plan provides for the granting of up to 50,000,000 options and shares to our personnel. Generally, stock options granted under the Incentive Plan are for a maximum term of ten years and unless otherwise provided in the specific award document vest and are exercisable immediately. Unless otherwise provided, the options expire within one year after termination of service or three months if termination is for cause. The Board of Directors administers the Incentive Plan. The Incentive Plan may be amended by the directors except where required by the Internal Revenue Code as to any increase in the total number of underlying shares and the class of persons eligible to receive options or as otherwise required by any applicable law or regulation.

The Incentive Plan supercedes all of our previous stock option plans and any ad hoc issuance of options. In connection with the adoption of the Incentive Plan, we converted the options issued to our management (including 9,000,000 options issued to the Gelmons) area developers, franchisees, employees, consultants and one investor, into options subject to the Incentive Plan. We cancelled any other outstanding options. There were 37,935,000 options outstanding as of the date hereof.

Federal Income Tax Consequences. The United States federal income tax consequences of the issuance and exercise of options is generally as follows. The holder reports as ordinary income the discount, if any, between the fair market value and the exercise price on the exercise date. When the holder sells the underlying shares the holder recognizes as a capital gain the difference between their sales price and the total ordinary income previously reported. If the options are treated as incentive stock options under Section 422A under the Internal Revenue Code, the holder only reports the difference between the sale price of the underlying shares and the exercise price of the options as a capital gain in the year of sale. Incentive stock option treatment requires, among other limitations, that the exercise price be equal to the fair market value on the date of grant (110% of such fair market value in the case of directors, officers and 10% shareholders).

Option Grants to Management in 2004

Option grants to management during 2004 were as follows:

Name	Securities Underlying Options/SARs Granted (#)	Percent of Total Granted to Employees In Options/SARs *Fiscal Year ()**	Exercise or Base Price (S/Sh)	Expiration Date




Michael Gelmon, Chief Executive Officer and Director	2,500,000	50%	$0.14	11/1/2009



Cory Gelmon, President, Chief Financial Officer, Secretary and Director	2,500,000	50%	$0.14	11/1/2009

* Represents all options granted to individuals during 2004 as a percentage of all options granted to employees during 2004.

Option Exercises and Year-End Values

The following table sets forth-certain values with respect to stock options held by management at the end of 2004:

Name	Share Acquired on Exercise (#)	Value Realized	Number of Securities Underlying Unexercised Options/SAR’s at FY-end (#) Exercisable/ Unexercisable	Value of Unexercised In-the-Money Options/SAR’s at FY-end (S) Exercisable/ Unexercisable







Michael Gelmon, Chief Executive Officer and Director			4,500,000 / 0⁽¹⁾(3)	45,315 / 0



Cory Gelmon, President, Chief Financial Officer, Secretary and Director			4,500,000 / 0⁽²⁾⁽³⁾	45,315 / 0

	(1)	Does not include 2,000,000 options exercisable at $.18 per shares that expire April 1, 2010 granted on April 1, 2005.
	(2)	Does not include 2,000,000 options exercisable at $.18 per shares that expire April 1, 2010 granted on April 1, 2005.
	(3)	On December 7, 2005, the exercise price of all of the options granted to the Gelmons was reduced to $.006 to reflect a decline in the market price of our common stock.

The foregoing table does not include 5,000,000 options granted to Marshall Wilmot in 2006. See Executive Compensation – Employment and Other Compensation-Related Agreements with Management.

PRINCIPAL SHAREHOLDERS

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

The following table sets forth information, as of the date hereof, with respect to the beneficial ownership of our common stock by each person known to be the beneficial owner of more than five percent of the outstanding common stock, and by our three directors and executive officers, individually and as a group.

Name and Address	Numbers of Shares Beneficially Owned	% Before offering After offering
Cory H. Gelmon 3019 Roxboro Glen Road S.W. Calgary, Alberta Canada T2S 1T9	22,687,230⁽¹⁾	11.89% 1.04%
Michael J. Gelmon 7008 Kootenay Street S.W. Calgary, Alberta, Canada T2V 2M3	22,123,333⁽²⁾	11.59% 1.01%
Marshall F. Wilmot 7 Snowberry Gate Calgary, Alberta, Canada T3Z 3C2	2,666,666⁽³⁾	1.43% 0.12%
Dr. Brad Goldstein 8375 Twin Lake Drive Boca Raton, Florida 33496	14,285,714⁽⁵⁾	7.75% 0.65%

Directors and Executive Officers as a group (2 persons)	47,477,229⁽⁵⁾	23.79% 2.16%

(1)	Includes 6,500,000 immediately exercisable options, 16,123,333 shares pledged as security for a loan, and 63,897 shares owned by members of his immediate family (see Executive Compensation and Certain Relationships and Related Transactions – Securities Purchase Agreements).

(2)	Includes 6,500,000 immediately exercisable options and 15,623,333 shares pledged as security for a loan (see Executive Compensation and Certain Relationships and Related Transactions – Securities Purchase Agreements).

(3)	Includes 1,000,000 shares held of record and 1,666,666 immediately exercisable options. See Executive Compensation—Employment and Other Compensation-Related Agreements with Management.

(4)	See Certain Relationships and Related Transactions—Premier Acquisition.

(5)	Includes 15,166,666 immediately exercisable options.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Chiropractic USA and Franchise Support Network Acquisitions

On May 7, 2001, we acquired certain intellectual property, goodwill and other nonmonetary assets from the Gelmons.

We purchased the Chiropractic USA development plan for our present business, the franchising of chiropractic clinics under the name Chiropractic USA from the Gelmons for 2,000,000 shares of common stock, 1,000,000 shares each. The shares were valued at the market price of $.03 per share on that date, an aggregate of $60,000. The $60,000 purchase price was allocated to goodwill.

We also purchased all of the issued and outstanding shares of Franchise Support Network, Inc. (“FSN”) from the Gelmons, its shareholders, in exchange for 34,047,666 shares. The assets of FSN were recorded on our balance sheet at $-0-, the Gelmons’ historical cost basis, in accordance with accounting rules that apply to transfers of nonmonetary assets from promoters and controlling shareholders. FSN had no assets as of the acquisition date, had not commenced operations and expenses since inception were not material. FSN is intended as a vehicle for acquiring, operating and selling franchises in various businesses.

On November 1, 2002, we issued to the Gelmons 24,000,000 shares for the purchase, 12,000,000 shares each. On March 18, 2005, we issued to the Gelmons the balance of 10,047,666 shares, 5,023,333 each.

In addition, we entered into management agreements with the Gelmons. Prior to these acquisitions, we engaged unsuccessfully, under different management, in various Internet commerce businesses and the manufacture and sale of computer cases. The purpose of these acquisitions and the benefit to our shareholders was to enable us to enter into our present business using the Gelmons’ proprietary concepts and know-how, to acquire the brand name Chiropractic USA, to acquire a vehicle for other franchising business, and to engage the Gelmons as management. Another purpose was that the Gelmons acquired control of the Company through their management positions and the stock ownership they attained. The number of shares we paid the Gelmons in the acquisitions and the allocation thereof to the development plan and for the shares of FSN were arbitrarily determined to facilitate the acquisition and do not reflect the actual cost of the assets acquired from the Gelmons or the value of the assets to us for financial reporting purposes.

Acquisition of Corporate Clinics

In September 2001, the Company entered into an agreement with Advanced Health Center, Inc. (“Advanced”) to purchase three chiropractic clinics and their operating assets for $1,150,000. The purpose of this transaction and the benefit to our shareholders was to enable us to own and operate clinics where we developed and demonstrated our franchise operating system and practices and showcased the Chiropractic USA brand.

In June 2002, the agreement was restructured at the request of the Merrill Lynch Business Financial Services, Inc. (“MLBFS”), the lender for the acquisition. MLBFS based approval of the loan on the business experience and personal credit of the Gelmons and strength of the business and assets to be acquired. There would have been substantial complications, delays and other problems involved in approving a loan to us, a small-cap public corporation with a negative operating history. To accommodate the restructuring, the Gelmons formed a new corporation, Southern Health Care, Inc (“Southern”), wholly owned by them to act as a holding company for the business acquired from Advanced. We assigned our right to acquire the clinics to Southern in exchange for a management agreement and franchise agreements. The effects of these agreements was that Southern is treated as our consolidated subsidiary in which we have all of the financial interest and that the Gelmons have no direct pecuniary interest in Southern. In connection with the sale of the clinics to LSI, the agreements with Southern were terminated. We intend to dissolve Southern. See Description of Business – Chiropractic USA.

On July 29, 2002, Southern completed the acquisition of Advanced. Southern acquired accounts receivable of $973,469 and furniture, fixtures and equipment of $176,531. In exchange, Southern paid the owner of Advanced, Dr. Dennis Gregory, $900,000 cash, and we issued Dr. Gregory $200,000 in promissory notes due April 30, 2005 with interest at 10% (of which $150,000 has been paid) and 277,778 shares of common stock valued at $50,000 ($.18 per share, the market price on the agreement date). Dr. Gregory is not affiliated with the Company other than through ownership of the shares issued in the acquisition.

MLBFS provided Southern with the cash used in the acquisition under a term loan and related installment note due July 31, 2005 in the original principal amount $1,000,000 with interest at 1.4% above the prime rate. On November 16, 2004, we prepaid the entire balance of $584,930 on the installment note.

In connection with the agreement to purchase Advanced, we issued an aggregate of 2,300,000 shares of common stock, valued at $345,000 ($.15 per share) to eight individuals for giving their personal guarantees of the term loan and installment note and as loan fees. The purpose and benefit to our shareholders of the personal guarantees was to provide MLBFS with additional recourse as an inducement to make the loan to Southern. The purpose and benefit to our shareholders from the issuance of the shares was to compensate the individuals for guaranteeing the loan as required by MLBFS. Included in the eight

individuals were the Gelmons, who each received 600,000 shares as guarantors and for their agreement to indemnify the other guarantors of the loan. Richard J. Doran Jr., a director, received 150,000 shares for his guarantee of the loan.

Loans

Management and members of their immediate families have loaned us funds to pay our debts from time to time.

Lloyd Parrish was a director who resigned in July 2002. As recently as April 9, 2003 he was also the beneficial owner of more than 5% of our common stock. In 2001 and prior fiscal years, Mr. Parish loaned us more than $28,200 and we issued several promissory notes to him that were due April 30, 2005. The notes are not secured and bear simple interest at 10% per annum. As of December 31, 2005, we have recorded a debit of $43,992 pursuant to these notes.

During 2001, Eva Gelmon, the mother of the Gelmons, loaned us $37,500. We issued a promissory note to her due April 30, 2005. The note is not secured and bears simple interest at 10% per annum. As of December 31, 2005, we owed Eva Gelmon $71,100 pursuant to this note.

From and after 2002, 860532 Alberta Ltd., which is owned and controlled by the Gelmons, loaned us funds. On November 16, 2004, we paid $52,451 against this debt to 860532 Alberta Ltd. As of December 31, 2004, the principal and interest due was $69,050 which was repaid on February 22, 2005. On December 1, 2004, we issued a new promissory note due January 1, 2006 with interest at 7% per annum to evidence our indebtedness to 860532 Alberta Ltd. for our obligations for prior and possible additional advances up to a maximum aggregate of $100,000. Previously the interest rate on the loan from 860532 Alberta Ltd. was 10%.

Contribution of Shares

On August 25, 2004, Michael J. Gelmon returned 9,600,000 shares to us for cancellation. He made the contribution to reduce the number of shares issued and outstanding. The benefit to the shareholders was to make 9,600,000 shares available to us to meet our obligations to issue shares we sold to certain investors for cash and agreed to pay for services provided to us. As repayment, we issued to Mr. Gelmon 3,000,000 shares on December 3, 2004 and 6,600,000 shares on March 18, 2005.

Consulting Agreement

On August 15, 2005 the Company entered into a Consulting Agreement with Alvin Gelmon, the father of the Company’s Chairman of the Board and Chief Executive Officer and of its President and Chief Financial Officer to consult with Chiropractic USA. The Company issued him 2,000,000 shares valued at $80,000 as consideration for services rendered and to be rendered.

Premier Acquisition

On February 10, 2006, we completed the acquisition of Premier pursuant to a Stock Purchase Agreement with Dr. Goldstein. Under the agreement, we paid Dr. Goldstein $2,000,000 in cash at closing plus 14,285,714 shares of our common stock. We also agreed to pay Dr. Goldstein an additional $100,000 and an amount equal to the pre-closing accounts receivable that are actually collected, once Premier’s cash flow permits these additional payments to be made.

Dr. Goldstein entered a new one-year employment agreement with Premier effective February 10, 2006. Under this agreement, Dr. Goldstein will continue to market, develop and supervise our diagnostic imaging business and to train clients, employees and Chiropractic USA franchisees. He will earn an annual salary of $200,000 and receive a grant of stock options pursuant to our 2004 Human Resources Incentive Stock Option Plan to be determined.

For as long as Dr. Goldstein continues to hold shares received in the transaction that are subject to restriction, Michael J. Gelmon, our Chief Executive Officer, and Cory H. Gelmon, our Chief Financial Officer and President, have agreed that if there is an offer to purchase any of their stock in Banyan, Dr. Goldstein has the right to sell his shares on the same terms and conditions as the Gelmons.

Securities Purchase Agreements

2006 Securities Purchase Agreement

Effective February 8, 2006 (the "Closing Date"), we entered into a Securities Purchase Agreement (the “2006 Securities Purchase Agreement”) with AJW Partners, Inc., AJW Offshore, Ltd., AJW Qualified Partners, LLC and New Millennium Capital Partners II, LLC (hereinafter collectively referred to as the "Selling Shareholders") and ancillary agreements (hereinafter described collectively as the "2006 Transaction Agreements"). Under the 2006 Securities Purchase Agreement, we agreed to sell the Selling Shareholders a total of $3,000,000 in Callable Secured Convertible Notes (the "2006 Convertible Notes") due February 8, 2009 with 8% annual interest payable quarterly. The Selling Shareholders may

convert the 2006 Convertible Notes into shares at the lower of $.005 per share or 50% of the three lowest intraday trading prices during the twenty trading days prior to conversion. Based on the conversion price of $.0025 on February 7, 2006 the 2006 Convertible Notes can be converted into a minimum of 1,200,000,000 shares. Management believes that the actual conversion price may be lower and more than the minimum number of shares that may be issued when the Convertible Notes are converted.

To date, the Selling Shareholders have purchased $2,150,000 of the 2006 Convertible Notes. The 2006 Securities Purchase Agreement provides for the sale of an additional $850,000 of the 2006 of the Convertible Notes. On the last business day of each month beginning in March 2006 and ending in December 2006, the Selling Shareholders will purchase from the Company $85,000 in 2006 Convertible Notes and Warrants to purchase 1,275,000 shares.

We agreed to issue to the Selling Shareholders for no additional cash consideration Stock Purchase Warrants (the "2006 Warrants") to purchase an aggregate of 45,000,000 shares at $.001 per share, fifteen warrants for each one dollar of 2006 Convertible Notes purchased by the Selling Shareholders. 32,250,000 of the 2006 Warrants have been issued as of the date hereof. The Warrants expire February 8, 2011.

$2,000,000 of the proceeds from the 2006 Convertible Notes were used for the Premier Acquisition — the balance of $1,000,000 will be used for working capital and for expenses. See Certain Relationships and Related Transactions – Premier Acquisition.

2004 Securities Purchase Agreement

Effective November 8, 2004 (the "Closing Date"), we entered into a Securities Purchase Agreement with AJW Partners, Inc., AJW Offshore, Ltd., AJW Qualified Partners, LLC and New Millennium Capital Partners II, LLC (hereinafter collectively referred to as the "Selling Shareholders") and ancillary agreements (hereinafter described collectively as the "2004 Transaction Agreements"). Under the Securities Purchase Agreement, we sold the Selling Shareholders a total of $3,000,000 in Callable Secured Convertible Notes (the "Convertible Notes") due November 8, 2006 with 10% annual interest payable quarterly, the first four months interest to be prepaid from proceeds of the Convertible Notes. The Selling Shareholders may convert the Convertible Notes into shares at the lower of $.22 per share or 50% of the three lowest intraday trading prices during the twenty trading days prior to conversion.

We agreed to issue to the Selling Shareholders for no additional cash consideration Stock Purchase Warrants (the "2004 Warrants") to purchase one share at $.40 per share for each one dollar of Convertible Notes purchased by the Selling Shareholders. The Warrants expire November 8, 2009.

To date, the Selling Shareholders have converted $1,155,162 of the 2004 Convertible Notes into 74,400,000 shares, an average of $.015 per share. Based on the conversion price of $.025 on February 7, 2006 the remaining $1,844,830 in principal amount of 2004 Convertible Notes can be converted into a minimum of 800,000,000 shares. Management believes that the actual conversion price may be lower and more than the minimum number of shares may be issued when the Convertible Notes are converted.

The proceeds from the Convertible Notes was used to prepay the balance of $584,930 on a term loan and related installment note due July 31, 2005 in the original principal amount of $1,000,000 that were personally guaranteed by the Gelmons and others and $69,000 was used to repay a loan from 860532 Alberta Ltd. that is owned by the Gelmons. See Certain Relationships and Related Transactions – Acquisition of Corporate Clinics, and Certain Relationships and Related Transactions – Loans. We also used the proceeds to repay principal and interest on other outstanding notes and accounts payable, fees, and business development purposes, including $700,000 to enter the diagnostic imaging business. See Description of Business – Diagnostic USA.

Provisions Common to the 2004 and 2006 Transaction Agreements

The Selling Shareholders will be entitled to exercise the Warrants on a cashless basis if the shares of common stock underlying the Warrants are not then registered pursuant to an effective registration statement. In the event that a Selling Shareholder exercises the Warrants on a cashless basis, then we will not receive any proceeds. In addition, the exercise price of the Warrants will be adjusted in the event we issue common stock at a price below market, with the exception of any securities issued as of the date of the warrant or issued in connection with the Convertible Notes issued pursuant to the Securities Purchase Agreement. Upon the issuance of shares of common stock below the market price, the exercise price of the Warrants will be reduced accordingly. The market price is determined by averaging the last reported sale prices for our shares of common stock for the five trading days immediately preceding such issuance as set forth on our principal trading market. The exercise price shall be determined by multiplying the exercise price in effect immediately prior to the dilutive issuance by a fraction. The numerator of the fraction is equal to the sum of the number of shares outstanding immediately prior to the offering plus the quotient of the amount of consideration received by us in connection with the issuance divided by the market price in effect immediately prior to the issuance. The denominator of such issuance shall be equal to the number of shares outstanding after the dilutive issuance.

In addition, the conversion price of the Convertible Notes and the exercise price of the Warrants will be adjusted in the event that we issue common stock at a price below the fixed conversion price, below market price, with the exception of any securities issued in connection with the Securities Purchase Agreement. The conversion price of the Convertible Notes and the exercise price of the Warrants may be adjusted in certain circumstances such as if we pay a stock dividend, subdivide or combine outstanding shares of common stock into a greater or lesser number of shares, or take such other actions as would otherwise result in dilution of the Selling Shareholders’ positions.

Payment of the Convertible Notes is secured by all of our assets pursuant to a Security Agreement and an Intellectual Property Security Agreement.

Pursuant to a Registration Rights Agreement we agreed to file a registration statement to register on request by the Selling Shareholders the shares underlying the Notes and Warrants.

Michael Gelmon and Cory Gelmon each entered into a Guaranty and Pledge Agreement to provide additional security for our performance of the Transaction Agreements. Michael Gelmon pledged to the Selling Shareholders 14,623,333 shares he now owns of record. Cory Gelmon pledged to the Selling Shareholders 15,123,333 shares he owns of record.

We will be subject to the payment of certain penalties and damages in the event we do not satisfy our obligations under the Transaction Agreements including those with respect to registration of the shares underlying the Convertible Notes and Warrants.

None of the Selling Shareholders are affiliates of the company. If all of the Convertible Notes are converted and/or if certain conversion limitations are disregarded, the Selling Shareholders are the beneficial owners of 5% or more of our outstanding shares. In the event we default under the Transaction Agreements, the Selling Shareholders may become the record and beneficial owners of the shares pledged by the Gelmons. The Selling Shareholders have contractually agreed to restrict their ability to convert or exercise their Warrants and receive shares of our common stock such that the number of shares of common stock held by them and their affiliates after such conversion or exercise does not exceed 4.99% of the then issued and outstanding shares of common stock.

SELLING SHAREHOLDERS

The table below sets forth information concerning the resale of the shares of common stock by the Selling Shareholders. We will not receive any proceeds from the resale of the common stock by the Selling Shareholders We will receive proceeds from the exercise of the Warrants unless the Selling Shareholders exercise the Warrants on a cashless basis. Assuming all the shares registered below are sold by the Selling Shareholders, none of the Selling Shareholders will continue to own any shares of our common stock.

The following table also sets forth the name of each person who is offering for resale shares of common stock covered by this prospectus, the number of shares of common stock beneficially owned by each person, the number of shares of common stock that may be sold in this offering and the number of shares of common stock each person will own after the offering, assuming they sell all of the shares offered.

Name	Beneficial Ownership Before Offering⁽¹⁾	Percentage of Common stock Before Offering⁽²⁾	Beneficial Ownership After the Offering ⁽⁴⁾	Percentage of Common stock Owned After Offering ⁽⁴⁾
AJW Partners, LLC⁽³⁾	264,530,000	4.99%	-0-	-0-
AJW Qualified Partners, LLC ⁽³⁾	1,049,620,000	4.99%	-0-	-0-
AJW Offshore Ltd. ⁽³⁾	652,300,000	4.99%	-0-	-0-
New Millennium Capital Partners II, LLC⁽³⁾	33,550,000	4.99%	-0-	-0-

(2) The actual number of shares of common stock offered in this prospectus, and included in the registration statement of which this prospectus is a part, includes such additional number of shares of common stock as may be issued or issuable upon conversion of the Convertible Notes and exercise of the related Warrants by reason of any stock split, stock dividend or similar transaction involving the common stock, in accordance with Rule 416 under the Securities Act of 1933, as amended. However the Selling Shareholders have contractually agreed to restrict their ability to convert their secured Convertible Notes or exercise their Warrants and receive shares of our common stock such that the number of shares of common stock held by them in the aggregate and their affiliates after such conversion or exercise does not exceed 4.99% of the then issued and outstanding shares of common stock as determined in accordance with Section 13(d) of the Exchange Act. Accordingly, the number of shares of common stock set forth in the table for the Selling Shareholders exceeds the number of shares of common stock that the Selling Shareholders could own beneficially at any given time through their ownership of the Convertible Notes and the Warrants. In that regard, the beneficial ownership of the common stock by the Selling Shareholders set forth in the table is not determined in accordance with Rule 13d-3 under the Securities Exchange Act of 1934, as amended.

(3) The Selling Shareholders are affiliates of each other because they are under common control. AJW Partners, LLC is a private investment fund that is owned by its investors and managed by SMS Group, LLC. SMS Group, LLC, of which Mr. Corey S. Ribotsky is the fund manager, has voting and investment control over the shares listed above owned by AJW Partners, LLC. AJW Offshore, Ltd., is a private investment fund that is owned by its investors and managed by First Street Manager II, LLC. First Street Manager II, LLC, of which Corey S. Ribotsky is the fund manager, has voting and investment control over the shares owned by AJW Offshore, Ltd. AJW Qualified Partners, LLC, is a private investment fund that is owned by its investors and managed by AJW Manager, LLC, of which Corey S. Ribotsky and Lloyd A. Groveman are the fund managers, have voting and investment control over the shares listed above owned by AJW Qualified Partners, LLC. New Millennium Capital Partners II, LLC, is a private investment fund that is owned by its investors and managed by First Street Manager II, LLC. First Street Manager II, LLC, of which Corey S. Ribotsky is the fund manager, has voting and investment control over the shares owned by New Millennium Capital Partners II, LLC. The four Selling Shareholders are considered to be a group as defined under the Securities Exchange Act of 1934. The four Selling Shareholders are affiliated entities and may not own more then 4.99% of our Common stock on an aggregate basis. We have been notified by the Selling Shareholders that they are not broker-dealers or affiliates of broker-dealers and that they believe they are not required to be broker-dealers.

(4) Assumes that all securities registered will be sold.

PLAN OF DISTRIBUTION

The Selling Shareholders and any of their donees, pledgees, assignees and other successors-in-interest may, from time to time, sell any or all of their shares of our common stock being offered under this prospectus on any stock exchange, market or trading facility on which the shares are traded or in private transactions. These sales, which may include block transactions, may be at fixed or negotiated prices. The Selling Shareholders may use any one or more of the following methods when selling shares:

(a) ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers; (b) block trades in which the broker-dealer will attempt to sell the shares as agent but may position and resell a portion of the block as principal to facilitate the transaction; (c) purchases by a broker-dealer as principal and resales by the broker-dealer for its own account; (d) an exchange distribution in accordance with the rules of the applicable exchange; (e) privately negotiated transactions; (f) short sales, which are contracts for the sale of shares of stock that the seller does not own, or certificates for which are not within his control, so as to be available for delivery at the time when, under applicable rules, delivery must be made; (g) transactions to cover short sales; (h) broker-dealers may agree with the Selling Shareholders to sell a specified number of shares at a stipulated price per share; (i) a combination of any of these methods of sale; or (j) any other method permitted by applicable law.

The sale price to the public may be: (a) the market price prevailing at the time of sale; (b) a price related to the prevailing market price; (c) at negotiated prices; or (d) price the Selling Shareholders determine from time to time.

The shares may also be sold under Rule 144 or Regulation S under the Securities Act of 1933, if available, rather than under this prospectus. The Selling Shareholders have the sole and absolute discretion not to accept any purchase offer or make any sale of shares if they deem the purchase price to be unsatisfactory at any particular time.

The Selling Shareholders may also engage in short sales against the box, which are sales where the seller owns enough shares to cover the borrowed shares, if necessary, puts and calls and other transactions in securities of the Company or derivatives of the Company and may sell or deliver shares in connection with these trades. The Selling Shareholders may pledge their shares to their brokers under the margin provisions of customer agreements. If a Selling Shareholder defaults on a margin loan, the broker may, from time to time, offer and sell the pledged shares.

Broker-dealers engaged by the Selling Shareholders may arrange for other broker-dealers to participate in sales. Broker-dealers may receive commissions or discounts from the Selling Shareholders

(or, if any broker-dealer acts as agent for the purchaser of shares, from the purchaser) in amounts to be negotiated. The Selling Shareholders do not expect these commissions and discounts to exceed what is customary in the types of transactions involved.

The Selling Shareholders and any broker-dealers or agents that are involved in selling the shares may be deemed to be "underwriters" within the meaning of the Securities Act in connection with these sales. In that event, any commissions received by these broker-dealers or agents and any profit on the resale of the shares purchased by them may be deemed to be underwriting commissions or discounts under the Securities Act.

The Selling Shareholders, alternatively, may sell all or any part of the shares offered in this prospectus through an underwriter. To our knowledge, no Selling Shareholders has entered into any agreement with a prospective underwriter, and there is no assurance that any such agreement will be entered into. If a Selling Shareholders enters into such an agreement or agreements, the relevant details will be set forth in a supplement or revisions to this prospectus.

The Selling Shareholders and any other persons participating in the sale or distribution of the shares offered under this prospectus will be subject to applicable provisions of the Exchange Act and the rules and regulations under that act, including Regulation M. These provisions may restrict activities of, and limit the timing of purchases and sales of any of the shares by the Selling Shareholders or any other such person. Furthermore, under Regulation M, persons engaged in a distribution of securities are prohibited from simultaneously engaging in market making and other activities with respect to those securities for a specified period of time prior to the commencement of such distributions, subject to specified exceptions or exemptions. All of these limitations may affect the marketability of the shares.

This prospectus does not cover the sale or other transfer of the Convertible Notes or the Warrants held by the Selling Shareholders or the issuance of shares of common stock to the holders of the Convertible Notes or the Warrants upon conversion or exercise. If a Selling Shareholder transfers its Convertible Notes or Warrants prior to conversion or exercise, the transferee of the Convertible Notes or Warrants may not sell the shares of common stock issuable upon conversion of the Convertible Notes or upon exercise of the Warrants under the terms of this prospectus unless this prospectus is appropriately amended or supplemented by us.

For the period a holder holds the Convertible Notes or the Warrants, the holder has the opportunity to profit from a rise in the market price of our common stock without assuming the risk of ownership of the shares of common stock issuable upon conversion of the Convertible Notes or upon exercise of the Warrants. The terms on which we could obtain additional capital during the period in which the Convertible Notes or the Warrants remain outstanding may be adversely affected. The holders of the Convertible Notes and the Warrants are most likely to voluntarily convert their Convertible Notes or exercise their Warrants when the conversion price or exercise price is less than the market price of our common stock.

We have agreed to indemnify the Selling Shareholders, or their transferees or assignees, against certain liabilities, including liabilities under the Securities Act of 1933, as amended, or to contribute to payments the Selling Shareholders or their respective pledgees, donees, transferees or other successors in interest, may be required to make in respect of such liabilities.

DESCRIPTION OF CAPITAL STOCK

Our authorized capital stock is 500,000,000 shares of common stock and 100,000,000 shares of preferred stock, all no par value.

Shares of common stock may be issued from time to time as the Board of Directors may determine. Holders of common stock will be entitled to receive such dividends as may be declared by the Board of Directors out of funds legally available therefor after the requirements with respect to preferential dividends on the preferred stock, if any, have been met, and we have complied with all other requirements and subject to any other conditions relating to the preferred stock. In the event of liquidation, holders of common stock will be entitled to a proportionate share in any distribution of our assets after the payment of liabilities and after distribution in full of preferential amounts, if any, to be distributed to holders of the preferred stock. Holders of common stock will not have preemptive rights. Each share of common stock will be entitled to one vote, and cumulative voting will not be permitted in the election of directors.

At such time as there will be six or more directors, directors will be elected in three classes for terms of up to three years, and vacancies that occur during the year may be filled by the Board of Directors to serve for the remainder of the full term.

Shares of preferred stock may be issued from time to time in one or more series as may be determined by the Board of Directors. The voting powers and the preferences and the relative, participating, optional and other special rights of each such series, and the qualifications, limitations or restrictions thereof shall be established by the Board of Directors except that no holder of preferred stock shall have preemptive rights.

A quorum for the transaction of business at any meeting of the shareholders will be one-third of the shares entitled to vote. The affirmative vote of the holders of at least a majority of the shares voted at a meeting of the shareholders at which a quorum is present will constitute shareholder approval of matters to be acted upon by the shareholders. However, in the case of a sale or other transfer of substantially all our assets, liquidation, merger, consolidation, reorganization, or similar type of extraordinary corporate transaction with a beneficial owner of 10% or more, the affirmative vote of two-thirds of the shares entitled to vote thereon will constitute approval unless such transaction is with an affiliate or subsidiary, or the transaction is approved by the affirmative vote of a majority of our continuing directors. Continuing directors will be those directors who were our directors prior to the beneficial owner of 10% or more becoming a beneficial owner or affiliate, or who are designated continuing directors prior to or at their first election as directors. Shareholders may act by written consent of a majority of the shares entitled to vote, subject to any greater voting requirements as set forth above.

Although our Board of Directors has no current plans to use the additional shares of common stock, "blank check" preferred stock, classification of directors, cumulative voting and greater than a majority voting requirements to entrench present management, the foregoing are considered anti-takeover measures to prevent hostile takeovers attempts. To the knowledge of management, no hostile takeover attempts are presently threatened or contemplated.

The transfer agent and registrar for our common stock is Transfer Online, Inc. Its telephone number is (503) 227-2950.

LEGAL MATTERS

Noel E. Guardi, Attorney at Law, Pinecliffe, Colorado will pass upon the validity of the shares of common stock offered under this prospectus.

EXPERTS

Our consolidated financial statements as of December 31, 2004 and for the year ended December 31, 2004 included in this prospectus and in the registration statement of which this prospectus is a part have been audited by Schwartz Levitsky Feldman LLP, our independent registered public accountant firm, to the extent and for the periods set forth in their report, appearing elsewhere in this prospectus and are incorporated in this prospectus in reliance upon the report given upon the authority of Schwartz Levitsky Feldman LLP, as experts in auditing and accounting.

Our consolidated statements of operations, stockholders' deficit and cash flows for the year ended December 31, 2003 included in this prospectus and in the registration statement of which this prospectus is a part have been audited by GHP Horwath, P.C., our prior independent registered public accounting firm, to the extent and for the periods set forth in their report, which describes an uncertainty related to our ability to continue as a going concern, appearing elsewhere in this prospectus and are incorporated in this prospectus in reliance upon the report given upon the authority of GHP Horwath, P.C., as experts in auditing and accounting. GHP Horwath, P.C. has not performed any auditing, review or accounting services subsequent to the audit of the December 31, 2003 consolidated financial statements and on September 1, 2004, we dismissed them.

WHERE YOU CAN FIND MORE INFORMATION

We have filed with the Securities and Exchange Commission a registration statement on Form SB-2 under the Securities Act, and the rules and regulations promulgated under the Securities Act, with respect to the common stock offered under this prospectus. This prospectus, which constitutes a part of the registration statement, does not contain all of the information contained in the registration statement and the exhibits and schedules to the registration statement. While material elements of the contracts and documents referenced in this prospectus are contained in this prospectus, statements contained in this prospectus as to the contents of any contract or other document referred to are not necessarily complete, and in each instance reference is made to the full text of the contract or other document which is filed as an exhibit to the registration statement.

For further information with respect to us and the common stock offered under this prospectus, reference is made to the registration statement and its exhibits and schedules. The registration statement, including its exhibits and schedules, may be inspected without charge at the Public Reference Room maintained by the Securities and Exchange Commission at 450 Fifth Street, N.W., Washington, D.C. 20549. Copies of such documents may be obtained from the Securities and Exchange Commission upon the payment of the charges prescribed by the Securities and Exchange Commission. The public may obtain information on the operation of the Public Reference Room by calling the Securities and Exchange Commission at 1-800-SEC-0330.

The Securities and Exchange Commission maintains an Internet web site that contains reports, proxy and information statements and other information regarding issuers that file electronically with the Securities and Exchange Commission. The Securities and Exchange Commission's web site address is http://www.sec.gov/edgar. Our web site address is http://www.chiropracticusa.net.

BANYAN CORPORATION

CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2004 AND 2003

TOGETHER WITH REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
(Amounts expressed in US Dollars)

TABLE OF CONTENTS

Report of Independent Registered Public Accounting Firm		F-1

Report of Independent Registered Public Accounting Firm		F-2

Consolidated financial statements:

	Consolidated balance sheet as of December 31, 2004	F-3

	Consolidated statements of operations for the years ended December 31, 2004 and 2003	F-4

	Consolidated statements of stockholders’ deficit for the years ended December 31, 2004 and 2003	F-5

	Consolidated statements of cash flows for the years ended December 31, 2004 and 2003	F-6 - F-7

	Notes to consolidated financial statements	F-8 - F-21

Interim consolidated financial statements

	Interim consolidated balance sheet september 30, 2005	F-22

	Interim consolidated statements of operations three and nine months ended september 30, 2005 and 2004	F-23

	Interim consolidated statement of stockholder's deficit nine months ended september 30, 2005	F-24

	Interim consolidated statements of cach flows nine months ended september 30, 2005 and 2004	F-25

	Notes to Consolidated financial statements	F-26 - F-30

F-i

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of
Banyan Corporation

We have audited the accompanying consolidated balance sheet of Banyan Corporation. as at December 31, 2004 and the related consolidated statement of operations, cash flows (as restated – see Note 1) and stockholders’ deficiency for the year ended December 31, 2004. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the consolidated financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall consolidated financial statement presentation. We believe that our audit provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Banyan Corporation as at December 31, 2004 and the results of its operations and its cash flows (as restated – see Note 1) for the year ended December 31, 2004 in accordance with generally accepted accounting principles in the United States of America.

The accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern. As discussed in note 1 to the consolidated financial statements, the Company has incurred significant losses, has a working capital deficiency and lacks long-term financing. These conditions raise substantial doubt about its ability to continue as a going concern. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

The consolidated financial statements of Banyan Corporation as at December 31, 2003 (as restated) and for the years ended December 31, 2003 (as restated) and 2002 were audited by other auditors whose report dated April 15, 2004 included an explanatory paragraph that there was substantial doubt about the Company’s ability to continue as going concern and that those financial statements did not include any adjustments that might result from that uncertainty.

	“SCHWARTZ LEVITSKY FELDMAN LLP”

Toronto, Ontario, Canada April 15, 2005, except for Note 1 which is as of January 5, 2006 and Note 16 which is as of February 14, 2006	Chartered Accountants

F- 1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Board of Directors
Banyan Corporation

We have audited the accompanying consolidated statements of operations, stockholders' deficit and cash flows of Banyan Corporation and subsidiaries for the year ended December 31, 2003. 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 audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the results of operations and cash flows of Banyan Corporation and subsidiaries for the year ended December 31, 2003, in conformity with accounting principles generally accepted in the United States of America.

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial statements, the Company has incurred significant operating losses for several years. This raises substantial doubt about the Company’s ability to continue as a going concern. Management’s plans with regard to this matter are also described in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

As discussed in Note 1 to the consolidated financial statements, the Company has restated the statement of cash flows for the year ended December 31, 2003.

GHP HORWATH, P.C.

Denver, Colorado
April 15, 2004, except for the third paragraph of Note 1 as to which the date is February 13, 2006.

F- 2

BANYAN CORPORATION
CONSOLIDATED BALANCE SHEET
DECEMBER 31, 2004
(Expressed in US Dollars)

ASSETS

Current assets:
Cash and cash equivalents	$	945
Accounts receivable		30,000
Prepaid expenses		22,575
Current portion of note receivable (Note 3)		24,841

Total current assets		78,361

Note receivable (Note 3)		799,666
Other assets, net (Note 7)		167,710

	$	1,045,737


LIABILITIES AND STOCKHOLDERS' DEFICIT

Current liabilities:
Accounts payable (Note 10)	$	1,420,923
Accrued interest		72,242
Other liabilities (Note 11)		167,747
Notes payable (Note 8)
Related parties		119,050
Others		262,980

Total current liabilities		2,042,942

Convertible note (Note 7)		400,000

		2,442,942

Commitments and contingencies (Notes 3, 4, 5, 7, 9 and 11)

Stockholders' deficit (Notes 2, 3, 7, 9, 10 and 16)
Preferred stock; no par value; 10,000,000 shares authorized
Class A convertible preferred stock; 500,000 shares authorized
187,190 shares issued and outstanding;
liquidation preference $514,773		334,906
Common stock; no par value; 60,000,000 Class A shares
authorized; 58,661,744 shares issued and outstanding		9,962,336
Deferred compensation costs		(20,542	)
Common stock to be issued		73,912
Accumulated deficit		(11,747,817	)

Total stockholders' deficit		(1,397,205	)

	$	1,045,737

The accompanying notes are an integral part of these consolidated financial statements
F- 3

BANYAN CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
YEARS ENDED DECEMBER 31, 2004 AND 2003
(Expressed in US Dollars)

		2004			2003

Revenue from franchised clinics	$	465,729		$	54,138

Franchise cost		106,552			33,830
Impairment loss (Note 2)		-			52,000
Selling, general and administrative expenses		2,566,783			3,335,478

		2,673,335			3,421,308

Loss from operations		(2,207,606	)		(3,367,170	)

Other expense

Interest expense:
Related parties		(8,619	)		(3,250	)
Other		(71,057	)		(70,365	)

Loss from continuing operations		(2,287,282	)		(3,440,785	)

Discontinued operations (Note 3)
Loss from operations of discontinued subsidiary		(414,833	)		(478,588	)
Gain on disposal of net assets of subsidiary		242,187			-

		(172,646	)		(478,588	)

Net loss	$	(2,459,928	)	$	(3,919,373	)

Loss from continuing operations per common share:

Basic and diluted	$	(0.04	)	$	(0.07	)

Net loss per common share:

Basic and diluted	$	(0.04	)	$	(0.08	)

Weighted average number of common
shares- outstanding - basic and diluted		57,155,110			48,715,457

The accompanying notes are an integral part of these consolidated financial statements
F- 4

BANYAN CORPORATION
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT
YEARS ENDED DECEMBER 31, 2004 AND 2003
(Expressed in US Dollars)

													Common
	Preferred stock			Common stock									stock					Stock-
	Class A			Class A						Deferred			to be		Accumulated			holders'
	Shares		Amount	Shares			Amount			compensation			issued		deficit			deficit

Balances at January 1, 2003	187,190	$	334,906	43,451,846		$	4,496,796		$	(39,669	)	$	3,500	$	(5,368,516	)	$	(572,983	)

Issuance of common stock for services (Note 9)				422,000			65,500											65,500

Issuance of common stock for services (Note 9)				1,428,571			200,000			(200,000	)							-

Stock compensation plans (Note 9)							906,850											906,850

Transfer of 100,000 shares of subsidiary common
stock for services							6,000											6,000

Conversion of notes payable to equity (Note 9)				198,000			35,500											35,500

Common stock issued for cash (Note 9)				1,930,500			259,115											259,115

Common stock and warrants issued for cash
of $596,000 and services of $1,397,590 (Note 9)				5,660,000			1,993,590											1,993,590

Exercise of warrants for cash				350,000			35,000											35,000

Amortization of deferred compensation										56,999								56,999

Net loss															(3,919,373	)		(3,919,373	)

Balances at December 31, 2003	187,190		334,906	53,440,917			7,998,351			(182,670	)		3,500		(9,287,889	)		(1,133,802	)

Issuance of common stock for services (Note 9)				2,254,000			382,370											382,370

Issuance of common stock for services (Note 9)				500,000			123,250			(123,250	)							-

Stock compensation plans (Note 9)							412,950											412,950

Conversion of notes payable to equity (Note 9)				650,000			89,282											89,282

Common stock issued for cash (Note 9)				3,881,827			425,220											425,220

Common stock issued for cash and services
of $422,250 and services of $339,075 (Note 9)				4,935,000			761,325											761,325

Issuance of common stock for options exercised (Note 9)				300,000			30,000											30,000

Stock redeemed (Note 9)				(9,600,000	)		(1,440,000	)										(1,440,000	)

Stock reissued (Note 9)				3,000,000			450,000											450,000

Stock to be issued				(700,000	)		(70,412	)					70,412					-

Amortization of deferred compensation										285,378								285,378

Beneficial conversion (Note 7)							800,000											800,000

Net loss															(2,459,928	)		(2,459,928	)

Balances at December 31, 2004	187,190	$	334,906	58,661,744		$	9,962,336		$	(20,542	)	$	73,912	$	(11,747,817	)	$	(1,397,205	)

The accompanying notes are an integral part of these consolidated financial statements
F- 5

BANYAN CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
YEARS ENDED DECEMBER 31, 2004 AND 2003
(Expressed in US Dollars)

		2004			2003
		Restated			Restated
		(Note 1)			(Note 1)

Cash flows from operating activities
Net loss	$	(2,459,928	)	$	(3,919,373	)
Adjustments to reconcile net loss to net cash
used in operating activities:
Loss from discontinued operations		414,833			478,588
Gain on disposition of discontinued operations		(242,187	)		-
Impairment loss		-			52,000
Stock, options and warrents issued for services		1,134,395			2,238,529
Amortization of deferred compensation		285,378			56,999
Amortization of other assets		15,246			-
Expenses paid by convertible note		37,436			-
Note payable written-off		(45,000	)		-
Foreign exchange on note payable		17,500			-
Changes in assets and liabilities from continuing operations:
Accounts receivable		(22,754	)		(7,246	)
Accounts payable and accrued expenses		53,914			82,088
Cash flows (used in) provided by discontinuing operations		(273,425	)		385,418

Net cash used in operating activities		(1,084,592	)		(632,997	)

Cash flows from investing activities:
Cash flows used in discontinuing operations		-			(3,100	)

Cash flows from financing activities
Net proceeds from notes payable, related parties		(4,530	)		73,591
Proceeds from long term debt		377,103			-
Deferred finance fees		(5,000	)		-
Payments on long term debt and notes payable		(8,000	)		(55,000	)
Proceeds from issuance of common stock and exercise
of options and warrents		877,470			890,115
Cash flows used in discontinuing operations		(161,715	)		(311,577	)

Net cash provided by financing activities of continuing operations		1,075,328			597,129

Net decrease in cash		(9,264	)		(38,968	)

Cash and cash equivalents, beginning of year		10,209			49,177

Cash and cash equivalents, end of year	$	945		$	10,209

(continued)

The accompanying notes are an integral part of these consolidated financial statements
F- 6

BANYAN CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)
YEARS ENDED DECEMBER 31, 2004 AND 2003
(Expressed in US Dollars)

Supplemental disclosures of cash flow information:

Cash paid for interest	$	703		$	22,958

Supplemental disclosure of non-cash investing and
financing activities:

Convertible note
Convertible note, issued	$	1,200,000
Finance fees capitalized		(177,956	)
Expenses		(37,436	)
Prepaid interest		(22,575	)
Southern Health Care Inc. loan repaid		(584,930	)

	$	377,103		$

Sale of assets of Southern Health Care Inc.
Carrying value of net assets	$	471,278
Liabilities not assumed by purchaser		111,042
Note receivable issued		(824,507	)

Gain on sale of subsidiary	$	(242,187	)	$

Class A common stock issued in satisfaction of
notes payable (Note 9)	$	89,282		$	35,500

The accompanying notes are an integral part of these consolidated financial statements
F- 7

BANYAN CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2004 AND 2003
(Expressed in US Dollars)

1.	Organization, principles of consolidation, going concern, results of operations and management’s plans: Organization and principles of consolidation:

	Banyan Corporation (the “Company”), an Oregon corporation, was incorporated on June 13, 1978. The Company primarily franchises Chiropractic USA chiropractic clinics in the health care industry. All clinics are operated by independent entrepreneurs under the terms of franchise arrangements (franchisees).

	The consolidated financial statements include the accounts of Banyan Corporation, its wholly-owned subsidiaries, Banyan Financial Services, Inc. (a Colorado corporation), Franchise Support Network Inc. (a Canadian corporation) and its majority-owned subsidiary, Chiropractic USA, Inc. (a Colorado corporation) and the accounts of Southern Health Care, Inc. (a Colorado corporation) in accordance with guidelines established under Emerging Issue Task Force 97-2 Application of FASB Statement No. 94 and APB Opinion 16 to Physician Practice Management Entities and Certain Other Entities with Contractual Management Arrangements. The Company meets all six of the requirements for a controlling financial interest that results in the consolidation of Southern Health Care, Inc. All significant intercompany accounts and transactions have been eliminated in consolidation. Banyan Financial Services Inc. and Franchise Support Network Inc. have not commenced operations. The consolidated statements of cash flows for the years ended December 31, 2004 and 2003 were restated to be consistent with SFAS 95 to report cash flows related to discontinuing operations.

	Going concern, results of operations and management’s plans:

	The Company has incurred operating losses for several years. These losses have caused the Company to operate with limited liquidity and have created stockholders’ deficit and working capital deficiencies of $1,397,205 and $1,964,581, respectively, as of December 31, 2004. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans to address these concerns include the conversion of outstanding debt to equity, additional equity financing, sales of franchises, increasing collections of receivables from franchisees and acquisition of a diagnostic imaging business, which management believes to have a positive cash flow and in addition selling the company-owned clinics that had a negative cash flow.

	The accompanying financial statements do not include any adjustments relating to the recoverability and classification of assets or the amounts of liabilities that might be necessary should the Company be unsuccessful in implementing these plans, or otherwise be unable to continue as a going concern.

2.	Summary of significant accounting policies: Use of estimates:

	The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

	Cash and cash equivalents:

	The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents.

	Accounts receivable:

	Accounts receivable are uncollateralized and consist primarily of receivables from franchisees. Management reviews accounts receivable periodically for collectibility and establishes an allowance for doubtful accounts and records bad debt expense when deemed necessary.

F- 8

BANYAN CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2004 AND 2003
(Expressed in US Dollars)

2.	Summary of significant accounting policies (continued): Goodwill:

	Goodwill, arising from the acquisition of the Chiropractic USA development plan, represents the purchase price in excess of the fair value of assets acquired. In June 2001, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial and Accounting Standards (“SFAS”) No. 142, Goodwill and Other Intangible Assets. Effective January 1, 2002, SFAS No. 142 no longer allows the amortization of goodwill and intangible assets with indefinite useful lives. SFAS No. 142 requires that these assets be reviewed for impairment at least annually, or whenever there is an indication of impairment. Intangible assets with finite lives will continue to be amortized over their estimated useful lives and reviewed for impairment in accordance with SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets.

	SFAS No. 142 requires companies to allocate goodwill to identifiable reporting units, which are then tested for impairment using a two-step process detailed in the statement. The first step requires comparing the fair value of each reporting unit with its carrying amount, including goodwill. If the fair value exceeds the carrying amount, goodwill of the reporting unit is considered not impaired, and the second step of the impairment test is not necessary. If the fair value of the reporting unit does not exceed the carrying amount, the second step of the goodwill impairment test must be performed to measure the amount of impairment loss, if any. This step requires the allocation of the fair value of the reporting unit to the reporting unit’s assets and liabilities (including any unrecognized intangible assets) as if the reporting unit had been acquired in a business combination and the fair value of the reporting unit was the price paid to acquire the reporting unit. The excess of the fair value of the reporting unit over its re- evaluated net assets would be the new basis for the reporting unit’s goodwill, and any necessary goodwill write down to this new value would be recognized as an impairment expense. The Company performed its annual goodwill impairment test in the fourth quarter of 2003 and determined that goodwill was impaired as of that testing date. As a result, the Company recorded an impairment loss of $52,000 for the year ended December 31, 2003.

	Revenue recognition:

	Fees from franchised clinics include initial franchise fees and continuing royalty fees and marketing fees. Initial fees are recognized upon opening of a clinic, which is when the Company has performed substantially all initial services required by the franchise arrangement. Continuing fees are recognized in the period earned.

	Comprehensive income:

	SFAS No. 130, Reporting Comprehensive Income, establishes accounting and reporting requirements for comprehensive income. During the years ended December 31, 2004 and 2003, the Company had no components of comprehensive income to report.

	Foreign currency translation:

	Operating revenue and expenses arising from foreign currency transactions are translated into US dollars at exchange rates in effect on the date of the transactions. Monetary assets and liabilities are translated into US dollars at the exchange rate in effect at the balance sheet date. Gains or losses arising from the translations are included in earnings.

F- 9

BANYAN CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2004 AND 2003
(Expressed in US Dollars)

2.	Summary of significant accounting policies (continued): Stock-based compensation:

	SFAS No. 123, Accounting for Stock-Based Compensation allows companies to choose whether to account for employee stock-based compensation on a fair value method, or to continue accounting for such compensation under the intrinsic value method prescribed in Accounting Principles Board Opinion No. 25, Accounting for Stock Issued to Employees (“APB 25”). The Company has chosen to continue to account for employee stock based compensation using APB 25. Accordingly, no compensation expense has been recognized for options granted at fair value. Had compensation cost for the Company’s stock options plan been determined based on the fair value at the grant dates for awards under the plans consistent with the fair-value based method of accounting prescribed by SFSA No. 123, the Company’s results would have been changed to the pro forma amounts indicated below:

		2004			2003
Net loss, as reported	$	(2,459,928	)	$	(3,919,373	)
Deduct: Total stock-based employee
compensation expense determined under
fair value based method for all awards		(120,000	)		(375,500	)
Net loss, pro forma	$	(2,579,928	)	$	(4,294,873	)
Basic and diluted loss
per share, as reported	$	(0.04	)	$	(0.08	)
Basic and diluted loss per share, pro forma
per share, pro forma	$	(0.05	)	$	(0.09	)

The fair value of each option and grant is estimated on the date of the grant using the Black-Scholes option-pricing model with the following weighted-average assumptions used for grants in the years ended December 31, 2004 and 2003: dividend yield of zero; expected volatility of 16% (ranging from 197% to 181% for 2003); risk-free interest rates of 3% (ranging from 1.36% to 1.68% for 2003); and an expected term of 5 years (18-36 months for 2003).

Income taxes:

The Company provides for income taxes under the provisions of SFAS No. 109, Accounting for Income Taxes. SFAS No. 109 requires an asset and liability based approach in accounting for income taxes. Deferred income tax assets and liabilities are recorded to reflect the tax consequences on future years of temporary differences of revenue and expense items for financial statement and income tax purposes. Valuation allowances are established against assets, which are not likely to be realized.

Impairment of long-lived assets:

Management reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to future net cash flows expected to be generated by that asset. If such assets are considered impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Based on its review, management does not believe that any impairment of long-lived assets exists at December 31, 2004.

F-10

BANYAN CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2004 AND 2003
(Expressed in US Dollars)

2.	Summary of significant accounting policies (continued): Net loss per share:

	Basic net loss per share is computed by dividing the net loss applicable to common stockholders by the weighted-average number of shares of common stock outstanding for the year. Diluted net loss per share reflects the potential dilution that could occur if dilutive securities were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the Company, unless the effect of such inclusion would reduce a loss or increase earnings per share. For the years ended December 31, 2004 and 2003, the effect of the inclusion of dilutive shares would have resulted in a decrease in loss per share. Accordingly, the weighted average shares outstanding have not been adjusted for dilutive shares.

	Advertising:

	Advertising costs are expensed as incurred. For the years ended December 31, 2004 and 2003, advertising costs were approximately $114,000 and $90,000, respectively.

	Business segments:

	The Company has adopted SFAS No. 131, Disclosures About Segments of an Enterprise and Related Information, which establishes reporting and disclosure standards for an enterprise’s operating segments. Operating segments are defined as components of an enterprise for which separate financial information is available and regularly reviewed by the Company’s senior management. During 2004 and 2003, the Company operated in two business segments, franchising chiropractic clinics and chiropractic services, the later of which was disposed of in 2004 and is recorded under discontinued operations. (See Note 13)

	Recently issued accounting pronouncements:

	In January 2003, the FASB issued SFAS Interpretation No. 46, Consolidation of Variable Interest Entities (“FIN 46”), which changes the criteria by which one company includes another entity in its consolidated financial statements. FIN 46 requires a variable interest entity (“VIE”) to be consolidated by a company if that company is subject to a majority of the risk of loss from the variable interest entity’s activities or entitles to receive a majority of the entity’s residual returns or both. In December 2003, the FASB approved a partial deferral of FIN 46 along with various other amendments. The effective date for this interpretation has been extended until the first fiscal period ending after December 15, 2004. However, prior to the required application of this interpretation, a public entity that is a small business issuer shall apply this interpretation to those entities that are considered to be special purpose entities no later than as of the end of the first reporting period after December 15, 2003. As the Company does not currently have an interest in a VIE or special purpose entity, management does not expect that the adoption of FIN 46 will have a material effect on the financial condition or results of operations of the Company. In May 2003, the FASB issued SFAS No. 150, Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity. SFAS No. 150 establishes new standards on how an issuer classifies and measures certain financial instruments with characteristics of both liabilities and equity. The provisions of SFAS No. 150 are generally effective for all financial instruments entered into or modified after May 31, 2003, except for those provisions relating to mandatory redeemable non- controlling interests, which have been deferred. The adoption of SFAS No. 150 did not have a material impact on the financial position or results of the Company. If the deferred provisions of SFAS No. 150 are finalized in their current form, management does not expect adoption to have a material effect on the financial position or results of operations of the Company.

F-11

BANYAN CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2004 AND 2003
(Expressed in US Dollars)

2.	Summary of significant accounting policies (continued): Recently issued accounting pronouncements (continued):

	In November 2004, the FASB issued SFAS No. 151, Inventory Costs – an amendment of ARB No. 43, Chapter 4. This statement amends the guidance in ARB No. 43, Chapter 4, Inventory Pricing, to clarify the accounting for abnormal amounts of idle facility expense, freight, handling costs, and waste material (spoilage). SFAS No. 151 requires that those items be recognized as current-period charges. In addition, this statement requires that all allocation of fixed production overheads to costs of conversion be based upon the normal capacity of the production facilities. The provisions of SFAS No. 151 are effective for fiscal years beginning after June 15, 2005. As such, the Company is required to adopt these provisions at the beginning of the fiscal year ended December 31, 2006. Management does not expect the adoption of SFAS No. 151 to have a significant impact on the financial position or results of operations of the Company.

	In December 2004, the FASB issued SFAS No. 152, Accounting for Real Estate Time-Sharing Transactions – an amendment of FASB Statements No. 66 and 67. This statement amends FASB Statement No. 66, Accounting for Sales of Real Estate, to reference the financial accounting and reporting guidance for real estate time-sharing transactions that is provided in AICPA SOP 04-2, Accounting for Real Estate Time-Sharing Transactions. SFAS No. 152 also amends FASB Statement No. 67, Accounting for Costs and Initial Rental Operations of Real Estate Projects, to state that the guidance for incidental operations and costs incurred to sell real estate projects does not apply to real estate time-sharing transactions, with the accounting for those operations and costs being subject to the guidance in SOP 04-2. The provisions of SFAS No. 152 are effective in fiscal years beginning after June 15, 2005. As Such the Company is required to adopt these provisions at the beginning of the fiscal year ended December 31, 2006. Management does not expect the adoption of SFAS No. 152 to have a significant impact on the financial position or results of operations of the Company.

	In December 2004, the FASB issued SFAS No. 153, Exchanges of Non-monetary Assets – an amendment of APB Opinion No. 29. SFAS No. 153 replaces the exception from fair value measurement in APB Opinion No. 29 for non-monetary exchanges of similar productive assets with a general exception from fair value measurement for exchanges of non-monetary assets that do not have commercial substance. A non-monetary exchange has commercial substance if the future cash flows of the entity are expected to change significantly as a result of the exchange. SFAS No. 153 is effective for all interim periods beginning after June 15, 2005. As such, the Company is required to adopt these provisions at the beginning of the fiscal quarter ended September 30, 2005. The Company is currently evaluating the impact of SFAS No. 153 on its consolidated financial statements.

	In December 2004, the FASB issued SFAS No. 123R, Share-Based Payment. SFAS No. 123R revises FASB Statement No. 123, Accounting for Stock-Based Compensation, and supersedes APB Opinion No. 25, Accounting for Stock issued to Employees. SFAS No. 123R requires all public and non-public companies to measure and recognize compensation expense for all stock-based payments for services received at the grant-date fair value, with the cost recognized over the vesting period (or the requisite service period). SFAS No. 123R is effective for non-small business issuers for all interim periods beginning after June 15, 2005. SFAS No. 123R is effective for small business issuers for all interim periods beginning after December 15, 2005. As such, the Company is required to adopt these provisions at the beginning of the fiscal quarter ended March 31, 2006. Retroactive application of the provisions of SFAS No. 123R to the beginning of the fiscal year that includes the effective date is permitted, but not required. The Company is currently evaluating the impact of SFAS No. 123R on its consolidated financial statements.

F-12

BANYAN CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2004 AND 2003
(Expressed in US Dollars)

3.	Business acquisitions and dispositions:

	In September 2001, the Company, entered into an agreement with Advanced Health Center, Inc. (“Advanced”) of Lake Charles, Louisiana to purchase three chiropractic clinics and their operating assets for $1,150,000. On June 26, 2002, the Company’s wholly-owned subsidiary, Chiropractic USA, Inc. assigned its right to acquire the clinics to Southern Health Care, Inc., (”Southern”) a newly formed Colorado holding company with no other assets, in exchange for a management agreement and franchise agreements. Southern is wholly owned by the Company’s chief executive and chief financial officer. This assignment was undertaken at the request of the financial institution funding the acquisition to accommodate their desired organizational structure for the transaction. On July 29, 2002, Southern completed the acquisition of Advanced. As part of the agreement to purchase Advanced, the Company agreed to issue an aggregate of 2,300,000 shares of its Class A common stock, valued at $345,000 as guarantee and loan fees on the financial institution debt of Southern. The guarantee and loan fees were being amortized over the three-year term of the loan. However, in November 2004, the Company repaid in full the guaranteed loan and wrote-off the unamortized balance of the guarantee. In December 2004, the net assets of Southern were transferred to Chiropractic USA, who in turn sold the net assets to a third party. The disposal included accounts receivable with a book value of approximately $650,000, furniture, fixtures and equipment with a book value of approximately $102,000 and accounts payable with a book value of approximately $224,000. The sale agreement is for $1,000,000 minus $175,493 of accounts payable and the company assuming $50,000 of accounts payable, in exchange for a promissory note of $824,507, bearing interest at 5% starting, principal and interest, in September 2005. Principal and interest amounts will be paid in 120 monthly instalments. The promissory note is secured by all current and future acquired assets of the purchaser.

	On May 7, 2001, the Company made an offer to purchase all of the issued and outstanding shares of Franchise Support Network, Inc. (“FSN”) in exchange for 34,047,666 shares of the Company’s Class A common stock. The Company issued an aggregate of 24,000,000 shares of its Class A common stock to the shareholders of FSN, Michael and Cory Gelmon, on November 30, 2002. The transaction has been accounted for by the Company under guidance provided by SAB No. 48 (Topic 5-G), Transfers of Nonmonetary Assets by Promoters or Shareholders. Accordingly, the assets of FSN have been recorded at the transferors’ historical cost basis, which is zero, as FSN had no assets as of the acquisition date, had not commenced operations and expenses since inception are not material. At December 31, 2004, the Company’s chief executive and chief financial officer hold 15,100,000 shares of the Company’s Class A common stock, or approximately 26% of the issued and outstanding Class A common stock. At December 31, 2004, there were 10,047,666 shares to be issued to the Company’s chief executive and chief financial officer for the acquisition of FSN, when they become available for issue (see Note 16).

4.	Franchise Operations:

	As of December 31, 2004, the Company’s subsidiary, Chiropractic USA Inc., is entered into more than fifty franchise agreements. Franchise agreements are for ten-year terms. The franchise agreements provide for payment of percentage royalties, contribution to a national advertising fund, and charges for additional services selected by the franchisee. New practitioners pay a franchise fee in addition to these charges. Some franchise agreements cover more than one location.

	As of December 31, 2004, the Company’s subsidiary Chiropractic USA Inc., is entered into thirteen area developer agreements. Area developer agreements are for five-year terms. An area developer is responsible for developing a number of additional Chiropractic USA franchised locations within an exclusive territory. Area developers are paid a percentage of the royalties collected in the territory. An area developer typically enters into one or more franchise agreements.

F-13

BANYAN CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2004 AND 2003
(Expressed in US Dollars)

5.	Lease commitments:

	The Company leases office space in Los Angeles, California under a month-to-month lease for $250 per month.

6.	Income taxes:

	The Company did not incur income tax expense for the years ended December 31, 2004 and 2003. The difference between the expected tax benefit computed at the federal statutory income tax rate of 34% and the effective tax rate for the years ended December 31, 2004 and 2003 was due primarily to the tax effect of the change in the valuation allowance.

	The Company recognizes deferred tax liabilities and assets for the expected future tax consequences of events that have been recognized in the financial statements or tax returns. Under this method, deferred tax liabilities and assets are determined based on the difference between the financial statement carrying amounts and tax bases of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse.

	The following is a summary of the Company’s deferred tax assets and liabilities arising from differences in financial statement and income tax bases for the following assets at December 31, 2004:

Net operating loss carry forward	$	3,702,600
Deferred tax asset valuation allowance		(3,702,600	)

	$	-

	At December 31, 2004 the Company has approximately $10,890,000 of unused federal net operating loss carry forwards, which expire from 2005 through 2024. A valuation allowance has been provided to reduce the deferred tax assets to zero, as realization is not assured. In addition, due to the change in control of the Company in 2002, the net operating loss carry forwards may be limited.

7.	Convertible note:

Face value of note	$	1,200,000
Less: unamortized discount		(800,000	)

	$	400,000

The Company has entered into an agreement to sell $3,000,000 in convertible notes. The proceeds are to be advanced in stages.

The convertible notes have a term of two years after issuance and bear interest at 10%. Four months of interest is payable upon issuance. Any interest that has not been paid in advance is payable monthly. In any month in which the stock price is greater than $0.22, the interest for that month shall be zero. The notes are immediately convertible into shares of the Company’s common stock at the holder’s option. The conversion price will be equal to the lesser of $0.22 and the average of the lowest 3 intra-day trading prices during the 20 trading days prior to the conversion date discounted by 40%.

Lenders shall receive for each $1.00 of note, warrants to purchase one share of the Company’s common stock. Warrants have a five-year term from the date of issuance with an exercise price equal to $0.40 a share. Warrants are issued at the same time the proceeds are received.

As of December 31, 2004, the first advance of the $1,200,000 was received, and 1,200,000 warrants were issued. Financing fees related to the first advance amounted to $182,956. The fees were capitalized and are being amortized over the two-year term of the note. The note is due in November 2006. The second advance of $800,000 was received after the year-end upon filing of a registration statement for the shares underlying the convertible notes and warrants. The final $1,000,000 advance is due within five days after the effective date of the registration statement

F-14

BANYAN CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2004 AND 2003
(Expressed in US Dollars)

7.	Convertible note (continued):

	As a result of the advance of the amount $1,200,000 on account of the convertible note, a beneficial conversion in the amount of $800,000 resulted this amount has been deducted from the face value of the note and will be charged to earnings upon the registration statement becoming effective. The receipt of the second advance of $800,000 will result in an estimated beneficial conversion in the amount of $533,000, which will be added to the unamortized discount and charged to earnings upon the registration statement becoming effective.

8.	Notes payable:

	At December 31, 2004 notes payable consist of the following:

	Related Parties

Note payable, family member of a principal stockholder/officer; unsecured;
interest at 10%; due January 2006	$	50,000
Note payable, entity controlled by chief executive and chief financial officers;
unsecured; interest at 10%; due January 2006		69,050

	$	119,050

Other

Note payable; unrelated entity, unsecured; interest at 10%, due June 2002, past due	$	5,000
Note payable; unrelated party, unsecured; interest at 8%, due April 2005		15,000
Note payable; unrelated party, unsecured; interest at 10%, due April 2005		33,840
Note payable; unrelated party, unsecured; interest at 9%, due April 2005		16,300
Note payable; unrelated party, unsecured; interest at 9%, due April 2005		12,200
Note payable; unrelated party, unsecured; interest at 10%, due April 2005		130,640
Note payable; unrelated party, unsecured; interest at 10%, due April 2005		50,000

	$	262,980

9.	Stockholders’ deficit: Preferred stock:

	The Company has 10,000,000 shares of no par value preferred stock authorized, and has designated 500,000 shares of Class A convertible preferred stock and 500,000 shares of Class B preferred stock. No Class B preferred stock is issued or outstanding.

	At December 31, 2004 and 2003, there were 187,190 shares of no par value, Class A convertible preferred stock issued and outstanding. The Company may call the shares at $2.75 per share at any time. Each share of Class A convertible preferred stock is convertible at any time into one share of the Company’s Class A common stock.

	Common stock:

	In September 2003, the Board of Directors re-designated 10,000,000 shares of no par value, Class B common stock as no par value, Class A common stock thereby increasing the number of authorized shares of Class A common stock from 50,000,000 to 60,000,000. There are no longer any shares of Class B common stock authorized.

	At December 31, 2004, the Company has 60,000,000 shares of no par value, common stock authorized. At the end of the year, there were 58,661,744 shares of Class A common stock issued and outstanding. In addition, the Company has outstanding options of 22,120,000, outstanding warrants of 1,200,000, a commitment to issue 1,800,000 additional warrants, outstanding preferred stock of 187,190, 10,047,666 shares to be issued to its officers and directors in connection with the acquisition of intellectual property and the stock of a now-inactive subsidiary, a commitment to issue 6,600,000 shares to the Chief Executive Officer and 700,000 shares to be issued for subscriptions before December 31, 2004. The Company does not have sufficient authorized shares to issue and deliver all those shares. The Company had a special shareholders’ meeting to increase its authorized shares in an amount sufficient to meet its obligations to issue shares and future requirements in March 2005 (see Note 16).

F-15

BANYAN CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2004 AND 2003
(Expressed in US Dollars)

9.	Stockholders’ deficit (continued): Stock transactions:

	During the year ended December 31, 2004, the Company sold an aggregate of 4,935,000 shares of its Class A common stock, at less than the market value on the date of sale, for cash of $422,250 to franchisees and area developers. As the cash consideration for the stock sales was less than the market value on the sales dates, the Company recorded an expense of $339,075 for the effect of these discounts. During the year ended December 31, 2004, the Company issued an aggregate of 3,881,827 shares of Class A common stock to investors at an average price of approximately $0.11 per share for total cash consideration of $425,220.

	In February 2004, the Company issued 500,000 shares of Class A common stock, valued at $0.25 per share, which was equal to the market price on the agreement date, to consultants under twelve month service agreements.

	In February 2004, the Company issued 950,000 shares of Class A common stock for services rendered. The shares were valued at $212,544 and expensed.

	In February 2004, the Company issued 300,000 shares of Class A common stock to related parties who exercised options. The company received $30,000.

	In August 2004, the Company issued 904,000 shares of Class A common stock for services rendered. The shares were valued at $114,376 and expensed.

	In August 2004, the Company redeemed 9,600,000 shares of Class A common stock from the chief executive officer of the Company. The shares were valued at $1,440,000 and recorded as payable. In September 2004, the Company issued 650,000 shares of Class A common stock, valued at $89,282 for cancellation of debt.

	In October 2004, the Company issued 250,000 shares of Class A common stock for services rendered. The shares were valued at $32,500 and expensed.

	In November 2004, the Company issued 150,000 shares of Class A common stock for services rendered. The shares were valued at $22,950 and expensed.

	In December 2004, the Company reissued 3,000,000 shares of Class A common stock to the chief executive officer. The shares were valued at $450,000 and recorded against the payable.

	During the year ended December 31, 2003 the Company sold an aggregate of 750,000 shares of its Class A common stock, at less than the market value on the sale date, and 4,910,000 units consisting of one share of its Class A common stock and a warrant to purchase one share of its Class A common stock, at less than market value of the common stock and fair value of the warrant on the sale date, for cash of $596,000 to franchisees and area developers. As the cash consideration for the stock sales was less than the market value on the sale dates, the Company recorded an expense of $407,350 for the effect of these discounts. The warrants are immediately exercisable and may be exercised for a period of 18 months from the sale date. The Company valued the warrants based on the Black-Scholes pricing model, resulting in compensation expense of $990,240.

	In February 2003, the Company issued 202,000 shares of Class A common stock, valued at $0.10 per share, the market price on the agreement date, to consultants for accounting and Internet services. In May 2003, the Company issued 20,000 shares of Class A common stock, valued at $0.14 per share, the market price on the agreement date, to a consultant for marketing services.

	In August 2003, the Company issued 1,428,571 shares of Class A common stock, valued at $0.14 per share, the market price on the agreement date, to a consultant for marketing services under a twelve month marketing service agreement.

	In July 2003, the Company issued 150,000 shares of Class A common stock at $0.12 per share, the market price on the agreement date, to an employee for services.

F-16

BANYAN CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2004 AND 2003
(Expressed in US Dollars)

9.	Stockholders’ deficit (continued): Stock transactions (continued):

	In October 2003, the Company issued 50,000 shares of Class A common stock, valued at $0.49 per share, the market price on the agreement date, to a consultant for marketing services.

	In December 2003, the Company issued 198,000 shares of its Class A common stock, valued at $35,500, to a former president of the Company in exchange for $35,500 reduction in debt.

	During the year ended December 31, 2003, the Company issued an aggregate of 1,930,500 shares of its Class A common stock to investors at an average price of approximately $0.13 per share, for total cash consideration of $259,115.

	Stock Option:

	On October 28, 2004 the Board of Directors adopted the 2004 Human Resources Incentive Plan (the "Incentive Plan") to provide incentive compensation to employees, directors, officers and others. The Incentive Plan provides for the granting of up to 50,000,000 options and shares to our personnel. Generally, stock options granted under the Incentive Plan are for a maximum term of ten years and unless otherwise provided in the specific award document vest and are exercisable immediately. Unless otherwise provided, the options expire within one year after termination of service or three months if termination is for cause. The Board of Directors administers the Incentive Plan. The Incentive Plan may be amended by the directors except where required by the Internal Revenue Code as to any increase in the total number of underlying shares and the class of persons eligible to receive options or as otherwise required by any applicable law or regulation.

	The Incentive Plan supercedes all previous stock option plans and any ad hoc issuance of options. In connection with the adoption of the Incentive Plan, the Company converted the options issued to our management, area developers, franchisees, employees, consultants and one investor, into options subject to the Incentive Plan. The Company cancelled any other outstanding options.

	During the year ended December 31, 2004, the Company granted options to purchase 4,565,000 shares of the Company’s Class A common stock at an average price of $0.10 per share to franchisees and area developers. The Company valued these options based on the Black-Scholes pricing model, resulting in recognition of compensation expense of approximately $268,000.

	In May 2004, the Company granted options to purchase 1,000,000 shares of the Company’s Class A common stock at $0.10 per share to an investor, as incentive to the purchase of 1,000,000 shares. The Company valued the options based on the Black-Scholes pricing model, resulting in recognition of compensation expense of $130,000.

	In November 2004, the Company granted options to purchase 150,000 shares of the Company’s Class A common stock at $0.10 per share to a consultant for services provided to the Company. The Company valued the options based on the Black-Scholes pricing model, resulting in recognition of compensation expense of $15,000.

	During the year ended December 31, 2003, the Company granted options to purchase 3,270,000 shares of the Company’s Class A common stock at an average price of $0.24 per option to franchisees and area developers. The Company valued the options based upon the Black-Scholes pricing model resulting in compensation expense of approximately $765,600.

	In July 2002, the Company committed to grant options to purchase 685,000 shares of the Company’s stock in July 2004, to an employee and to consultants for services at the weighted average closing price of the Company’s Class A common stock for the preceding 30 days, if the employees remains in the service of the company through that date. The Company accounts for these options as variable awards. At 2003, the total estimated value of these options was approximately $195,000. For the year ended December 31, 2003, the Company recorded an expense of approximately $137,400 under discontinued operations. See also Note 10 for stock options granted to related parties for which no expense has been recorded.

F-17

BANYAN CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2004 AND 2003
(Expressed in US Dollars)

9.	Stockholders’ deficit (continued): Stock Option (continued):

	A summary of options activity for the periods ended December 31, 2004 and 2003 is as follows:

				Weighted average
	Weighted shares			exercise price

January 1, 2003	7,480,000		$	0.11
Granted	5,970,000		$	0.20
Expired	(335,000	)	$	0.08

December 31, 2003	13,115,000		$	0.15

Granted	9,715,000		$	0.12
Exercised	(300,000	)	$	0.10
Expired	(410,000	)	$	0.55

December 31, 2004	22,120,000		$	0.13

The following table summarizes information about stock options outstanding at December 31, 2004.

		Weighted	Weighted		Weighted
Range of	Number	average	average	Number	average
exercise price	outstanding	contractual life	exercise price	exercisable	exercise price

$0.05-0.10	8,425,000	2.5 years	$0.09	8,425,000	$0.09
$0.11-0.20	13,435,000	3.5 years	$0.15	13,435,000	$0.15
$0.21-0.30	260,000	0.25 year	$0.25	260,000	$0.25

	22,120,000			22,120,000

10.	Related party transactions:

	As of December 31, 2004, $1,054,644 (2003 - $166,439) included in accounts payable is due to the chief executive officer and the chief financial officer of the Company. The payable does not bear interest and has no specific term of repayment. Of which $990,000 was to be repaid by the issuance of 6,600,000 shares of Class A common stock.

	In August 2004, the chief executive officer of the Company returned to the Company for cancellation 9,600,000 shares of Class A common stock. These shares have been treated as treasury stock available for future issuance. In December 2004, The Company reissued 3,000,000 of those shares to the chief executive officer. The Company intends to repay the remaining 6,600,000 shares when enough shares are available (see Note 9).

	In November 2004, the Company granted options to purchase an aggregate of 4,000,000 shares of the Company’s Class A common stock at $0.14 per share, which was equal to the market price on the agreement date to the chief executive officer and the chief financial officer of the Company. The options are exercisable through November 2009 and vest immediately.

	In January 2003, the company entered into an agreement with Britannia Law Office located in Calgary, Canada for Britannia to represent the Company in legal matters. The Company pays Britannia a monthly retainer of $12,000. During 2004 and 2003, the Company paid approximately $144,000 and $158,100 respectively to Britannia for these services. Britannia is owned by the president and chief executive officer of the Company.

F-18

BANYAN CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2004 AND 2003
(Expressed in US Dollars)

10.	Related party transactions (continued):

	In August 2003, the chief executive officer of the Company returned for cancellation 1,000,000 shares of Class A common stock held in his name to the Company. In September 2003, the Company issued 1,000,000 shares of Class A common stock to the chief executive officer as repayment.

	In August 2003, the Company granted options to purchase an aggregate of 2,000,000 shares of the Company’s Class A common stock at $0.18 per share, which was equal to the market price on the agreement date to the chief executive officer and the chief financial officer of the Company. The options were exercisable through August 2006 and vested immediately. During 2004, the Company extended the exercisable date through August 2008.

	During the year ended December 31, 2003, the Company received $73,591 in exchange for notes payable issued to an entity in which the Company’s chief executive officer and chief financial officer are shareholders. The notes are non-interest bearing and due on demand. During the same period, $35,000 was repaid on these related party notes.

	In June 2003, the Company granted options to purchase 500,000 shares of the Company’s Class A common stock at $0.12 per share, which was equal to the market price on the agreement date, and options to purchase 200,000 shares of the Company’s Class A common stock at $0.16 per share, which was greater than the market price on the agreement date, to an employee for services. The options vest over three years.

	In April 2003, the Company’s chief executive officer and chief financial officer transferred an aggregate of 4,800,000 shares of the Company’s Class A common stock held in their names to a shareholder and former director of the Company and another shareholder (the “Parties”) of the Company. In May 2001, the Company’s chief executive officer and chief financial officer entered into an agreement to each transfer 10% of the shares they received upon the closing of the Franchise Support Network, Inc. acquisition to allay the concerns of the Parties about dilution upon closing. Since no services were provided by the former director or the shareholder, the Company has not recorded expense for the transfer of the Class A common stock.

11.	Commitments and contingencies:

	A former officer and director of the Company was convicted in 1999 in U.S. District Court, Southern District of New York of securities violations occurring in 1996. No claims were made and no proceedings were instituted against the Company relating to these violations. The former officer and director claims that the Company must indemnify him for court-ordered restitution and his expenses, including attorney’s fees, in the criminal proceedings. The Company, based on an opinion of independent legal counsel, has taken the position that indemnification would be improper under the circumstances because the former officer and director had reasonable cause to believe his conduct was unlawful and that indemnification is null and void and unenforceable under the federal securities laws. Given that the likelihood of an unfavorable outcome of any proceeding that may be brought by the former president to enforce his indemnification claim is remote, no amount of potential loss has been accrued. During the years ended December 31, 2004 and 2003, the Company did not pay or incur any expenses, including attorney’s fees, on behalf of the former officer and director. $55,125 of note payable and accrued interest to his attorney, previously recorded, has been written-off in 2004.

	As of December 31, 2004 we owe $167,747 including accrued interest at the rate of 9% per annum with respect to a stipulated money judgment in favor of a broker-dealer. The judgment was entered in Multnomah County, Oregon pursuant to a settlement agreement entered into in January 2001. This legal proceeding arose from the alleged failure to deliver a stock certificate to the broker-dealer.

	On January 8, 2004, a former employee filed suit against the Company seeking unspecified money damages for breach of an alleged employment contract. The case was dismissed in 2005 without prejudice against the Company. There has been no indication that the former employee intends to reassert this claim.

F-19

BANYAN CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2004 AND 2003
(Expressed in US Dollars)

12.	Fair value of financial instruments:

	The fair value of a financial instrument is the current amount that would be exchanged between willing parties, other than in a forced liquidation. Fair value is best determined based upon quoted market prices. However, in many instances, there are no quoted market prices for the Company’s various financial instruments. In cases where quoted market prices are not available, fair values are based on estimates using present value or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. Accordingly, the fair value estimates may not be realized in an immediate settlement of the instrument. Accordingly, the aggregate fair value amounts presented may not necessarily represent the underlying fair value of the Company.

	The fair value of cash and cash equivalents, accounts receivable, accounts payable and notes payable to related parties approximate their carrying amounts because of the short maturities of these instruments. The fair value of the long-term note payable approximates its fair value because of the adjustable interest rate on the note. Notes payable to non-related parties are impractical to approximate because of their past due status. The fair value of other liabilities is impractical to estimate based because of the Company’s default on the agreement.

13.	Segment Information:

	During 2003, the Company had two business segments: Company owned operation of Chiropractic clinics and franchised chiropractic clinics. The accounting policies of the segments are the same as those described in the summary of significant accounting policies. The Company owned operation of Chiropractic clinics was disposed of during the 2004 year and are disclosed as discontinued operations.

F-20

BANYAN CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2004 AND 2003
(Expressed in US Dollars)

14.	Fourth Quarter Adjustments: Non-cash stock compensation

	During the fourth quarter 2004, the Company recognized expense for non-cash compensation in the amount of $339,075. These shares were issued to franchisees and area developers below the market value. $50,000, $143,875 and $145,200 of this expense was from shares issued during the first, second and third quarters of 2004, respectively.

	During the fourth quarter of 2004, the Company recognized expense for stock options issued in the amount of $412,950. These stock options were issued to franchisees, area developers, investors and consultants. $71,200, $156,000, $163,950 and $21,800 of this expense was from stock options issued during the first, second, third and fourth quarters of 2004, respectively.

15.	Subsidiary Stock Transaction:

	In January 2003, the Company agreed to transfer 100,000 shares of common stock it owns in the Company’s subsidiary, Chiropractic USA, Inc. to a consultant for services. The 100,000 shares represent a 10% minority interest in the subsidiary and were valued at $6,000, which the Company believes was the fair value of the common stock on the agreement date, as Chiropractic USA, Inc. had not yet generated any revenues as of the date of transfer. The Company entered into an agreement with the consultant, whereby he acquired an additional 39% interest in Chiropractic USA, Inc. in exchange for his services to promote Chiropractic USA and assist the Company with franchisee development and training for which he receives up to one quarter of the Company’s royalties on franchisees he introduces. The consultant was appointed to the board of directors of Chiropractic USA, Inc.

16.	Subsequent events

	On November 4, 2005, a court entered judgment in favor of four note holders and against the Company for $290,000 plus interest at 22% and cost of collection, including attorney fees. On February 8, 2006 the Court ordered this judgment vacated. On February 10, 2006, the four note holders requested the Court to reenter judgment. The Company will oppose reentry of judgment. On December 5, 2005, a former director of the Company and his wife filed suit seeking money damages for failure to pay in full certain promissory notes in the aggregate principal amount of $86,587.50, plus accrued interest and costs, including attorney fees. The Company is vigorously defending this case. Effective February 1, 2006, the Company hired a new Chief Operating Officer, Marshall F. Wilmot. Mr. Wilmot has overall responsibility for the day-to-day operations of the Company’s subsidiaries Chiropractic USA and Diagnostic USA. The Company’s compensation agreement with Mr. Wilmot provides for a salary of $120,000 per year, an annual bonus of up to $180,000 based upon the pre-tax earnings of Diagnostic USA in excess of $1,700,000. For his services, the Company also issued 1,000,000 shares of stock and granted 5,000,000 options exercisable at $.06 per share for five years, of which 1,666,667 vest immediately and 1,666,666 will vest on the first and second anniversary of his employment. Effective February 8, 2006, the Company entered into a Securities Purchase Agreement (the “2006 Securities Purchase Agreement”) with AJW Partners, Inc., AJW Offshore, Ltd., AJW Qualified Partners, LLC and New Millennium Capital Partners II, LLC (hereinafter collectively referred to as the "Investors") and ancillary agreements (hereinafter described collectively as the "2006 Transaction Agreements"). Under the 2006 Securities Purchase Agreement, the Company agreed to sell the Investors a total of $3,000,000 in Callable Secured Convertible Notes (the "2006 Convertible Notes") due February 8, 2009 with 8% annual interest payable quarterly. The Investors may convert the 2006 Convertible Notes into shares at the lower of $.005 per share or 50% of the three lowest intraday trading prices during the twenty trading days prior to conversion. Based on the conversion price of $.0025 on February 7, 2006 the 2006 Convertible Notes can be converted into a minimum of 1,200,000,000 shares. To date, the Investors have purchased $2,150,000 of the 2006 Convertible Notes. The 2006 Securities Purchase Agreement provides for the sale of an additional $850,000 of the 2006 Convertible Notes. On the last business day of each month beginning in March 2006 and ending in December 2006, the Investors will purchase from the Company $85,000 in 2006 Convertible Notes and Warrants to purchase 1,275,000 shares. The Company agreed to issue to the Investors for no additional cash consideration Stock Purchase Warrants (the "2006 Warrants") to purchase an aggregate of 45,000,000 shares at $.001 per share, fifteen warrants for each one dollar of 2006 Convertible Notes purchased by the Investors. 32,250,000 of the 2006 Warrants have been issued as of the date hereof. The Warrants expire February 8, 2011. Effective February 8, 2006, the Company agreed to lower the price of its earlier convertible notes to 50% of the three lowest intraday trading prices during the twenty trading days prior to conversion. To date, the Investors have converted $1,155,162 of the 2004 Convertible Notes into 74,400,000 shares, an average of $.015 per share. The Company recently purchased substantially all of the outstanding equity securities of the constituent entities of a diagnostic imaging business, Premier Medical Group, Inc., Premier Imaging, LLC and Premier Health Services, LLC, (hereinafter collectively referred to as “Premier”) from Dr. Brad Goldstein (“Dr. Goldstein”) the founder, owner and operator of Premier. As a result of the purchase, all of the assets and liabilities of the business have been transferred to the Company. On February 10, 2006, the Company completed the acquisition of Premier pursuant to a Stock Purchase Agreement with Dr. Goldstein. Under the agreement, the Company paid Dr. Goldstein $2,000,000 in cash at closing plus 14,285,714 shares of common stock. The Company also agreed to pay Dr. Goldstein an additional $100,000 and an amount equal to the pre-closing accounts receivable that are actually collected, once Premier’s cash flow permits these additional payments to be made. Dr. Goldstein entered a new one-year employment agreement with Premier effective February 10, 2006. He will earn an annual salary of $200,000 and receive a grant of stock options pursuant to our 2004 Human Resources Incentive Stock Option Plan to be determined.

F-21

BANYAN CORPORATION
INTERIM CONSOLIDATED BALANCE SHEET
SEPTEMBER 30, 2005
(UNAUDITED)
(Expressed in US Dollars)

ASSETS

Current assets:
Cash and cash equivalents	$	2,060
Accounts receivable		254,204
Prepaid expenses		65,000
Current portion of note receivable		66,064

		387,328

Note receivable		749,698
Intangible Asset - custom er list (Note 4)		676,667
Other assets, net (Note 6)		211,088

	$	2,024,781


LIABILITIES

Current liabilities:
Accounts payable and accrued liabilities	$	432,428
Accrued interest		66,274
Other liabilities		179,070
Debt settlem ent (Note 5)		291,907
Convertible notes (Note 6)		110,000
Notes payable
Related parties		88,032
Others		178,840

		1,346,551

Convertible notes (Note 6)		1,106,224

		2,452,775

STOCKHOLDERS' DEFICIT (NOTES 6, 7, 8 and 9)
Preferred stock; no par value; 100,000,000 shares authorized		-
Common stock; no par value; 500,000,000 shares
authorized; 110,091,898 shares issued and outstanding		14,856,835
Deferred com pensation costs		(234,979	)
Common stock to be issued; 2,049,999 shares		81,205
Accumulated deficit		(15,131,055	)

Total stockholders' deficit		(427,994	)

	$	2,024,781

See condensed notes to interim consolidated financial statements

F-22

BANYAN CORPORATION
INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS
THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2005 AND 2004
(UNAUDITED)
(Expressed in US Dollars)

		Three months ended September 30,						Nine months ended September 30,
		2005			2004			2005			2004
					Restated						Restated
					(Note 1)						(Note 1)
Revenue from franchised clinics	$	230,050		$	152,490		$	672,143		$	336,244
Revenue from diagnostic business		146,407			-			146,407			-

		376,457			152,490			818,550			336,244

Franchise cost		116,959			53,240			258,085			105,508

Selling, general and administrative
expenses		796,119			872,201			2,354,443			1,956,727

		913,078			925,441			2,612,528			2,062,235

Loss from operations		(536,621	)		(772,951	)		(1,793,978	)		(1,725,991	)

Other expense

Loss on settlement of debt		-			-			(250,000	)		-
Interest expense:
Related parties		(199	)		(813	)		(2,156	)		(2,438	)
Other		(494,964	)		(97	)		(1,337,104	)		(26,384	)

Loss from continuing operations		(1,031,784	)		(773,861	)		(3,383,238	)		(1,754,813	)

Discontinued operations
Loss from operations of
discontinued subsidiary		-			(67,544	)		-			(204,676	)

Net loss	$	(1,031,784	)	$	(841,405	)	$	(3,383,238	)	$	(1,959,489	)

Loss from continuing operations
per common share:

Basic and diluted	$	(0.01	)	$	(0.01	)	$	(0.04	)	$	(0.03	)

Net loss per common share:

Basic and diluted	$	(0.01	)	$	(0.01	)	$	(0.04	)	$	(0.03	)

W eighted average number of
common shares- outstanding -
basic and diluted		98,623,052			57,729,711			81,114,064			57,166,204

See condensed notes to interim consolidated financial statements

F-23

BANYAN CORPORATION
INTERIM CONSOLIDATED STATEMENT OF STOCKHOLDERS' DEFICIT
NINE MONTHS ENDED SEPTEMBER 30, 2005
(UNAUDITED)
(Expressed in US Dollars)

															Common
															stock						Stock-
	Preferred stock					Common stock						Deferred			to be			Accumulated			holders'
	Shares			Amount		Shares			Amount			compensation			issued			deficit			deficit

Balances at January 1, 2005	187,190		$	334,906		58,661,744		$	9,962,336		$	(20,542	)	$	73,912		$	(11,747,817	)	$	(1,397,205	)

Issuance of common stock for
services (Note 7)						2,300,000			506,000		$	(506,000	)								-

Issuance of common stock for
services (Note 7)						6,127,721			381,967												381,967

Stock compensation plans (Note 7)									104,600												104,600

Common stock issued for cash
(Note 7)						1,349,999			62,956												62,956

Stock issued for cash and services
of $94,000 and services of $33,500
(Note 7)						940,000			127,500												127,500

Common stock issued for debt
settlement (Note 5)						2,454,767			295,000												295,000

Conversion of convertible notes
(net of finance fees $88,227)
(Note 6)						22,660,000			776,863												776,863

Issuance of common stock for
acquisition of assets of Franchise
Support Network, Inc. (Note 7)						10,047,666															-

Stock reissued (Note 7)						6,600,000			990,000												990,000

Stock subscribed issued during
the period						700,000			73,912						(73,912	)					-

Exercise of options for services
(Note 7)						300,000			42,000												42,000

Stock to be issued						(2,049,999	)		(81,205	)					81,205						-

Transferred of preferred stock	(187,190	)		(334,906	)				334,906												-

Amortization of deferred compensation												291,563									291,563

Beneficial conversion (Note 6)									1,280,000												1,280,000

Net loss																		(3,383,238	)		(3,383,238	)

Balances at September 30, 2005	-		$	-		110,091,898		$	14,856,835		$	(234,979	)	$	81,205		$	(15,131,055	)	$	(427,994	)

See condensed notes to interim consolidated financial statements

F-24

BANYAN CORPORATION
INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS
NINE MONTHS ENDED SEPTEMBER 30, 2005 AND 2004
(UNAUDITED)
(Expressed in US Dollars)

		2005			2004


Net cash used in operating activities	$	(1,108,114	)	$	(700,568	)

Cash flows from investing activities:
Note receivable received		8,745
Investment		(700,000	)		-

Net cash used in investing activities		(691,255	)		-

Cash flows from financing activities
Net proceeds from notes payable, related parties		(31,018	)		(4,000	)
Net proceeds from notes payable, other		90,000			10,900
Proceeds from convertible notes		1,584,546			-
Payments on long term debt and notes payable		-			(150,000	)
Proceeds from issuance of common stock and exercise
of options and warrents		156,956			873,227

Net cash provided by financing activities of continuing operations		1,800,484			730,127


Net increase (decrease) in cash		1,115			29,559

Cash and cash equivalents, beginning of year		945			10,209

Cash and cash equivalents, September 30,	$	2,060		$	39,768

See condensed notes to interim consolidated financial statements

F-25

BANYAN CORPORATION
CONDENSED NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
NINE MONTHS ENDED SEPTEMBER 30, 2005 AND 2004
(UNAUDITED)
(Expressed in US Dollars)

1.	Basis of presentation

	The condensed financial statements included herein have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (the "SEC"). Certain information and footnote disclosures normally included in financial statements have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. These condensed financial statements should be read in conjunction with the annual audited financial statements and the notes thereto included in the Company's Form 10-KSB Annual Report and other reports filed with the SEC.

	The accompanying unaudited interim financial statements reflect all adjustments of a normal and recurring nature, which are, in the opinion of management, necessary to present fairly the financial position, results of operations and cash flows of the Company for the interim periods presented. The results of operations for these periods are not necessarily comparable to, or indicative of, results any other interim period or for the fiscal year taken as whole.

	The three and nine-month period ended September 30, 2004 were restated to reflect the adjustments made during the fourth quarter of 2004 as disclosed in Note 14 of the annual audited financial statements.

2.	Organization, principles of consolidation, going concern, results of operations and management's plans: Organization and principles of consolidation:

	Banyan Corporation (the "Company"), an Oregon corporation, was incorporated on June 13, 1978. The Company primarily franchises Chiropractic USA chiropractic clinics in the health care industry. All clinics are operated by independent entrepreneurs under the terms of franchise arrangements (franchisees). The Company also manages and market a diagnostic business owned by a partnership in which the Company holds a 1% interest.

	The consolidated financial statements include the accounts of Banyan Corporation, its wholly-owned subsidiaries, Diagnostic USA, Inc. (a Colorado corporation), Banyan Financial Services, Inc. (a Colorado corporation), Franchise Support Network Inc. (a Canadian corporation) and its majority-owned subsidiary, Chiropractic USA, Inc. (a Colorado corporation) and the accounts of Southern Health Care, Inc. (a Colorado corporation) and Southern Diagnostics, Inc. (a Colorado corporation) in accordance with guidelines established under Emerging Issue Task Force 97-2 Application of FASB Statement No. 94 and APB Opinion 16 to Physician Practice Management Entities and Certain Other Entities with Contractual Management Arrangements. The Company meets all six of the requirements for a controlling financial interest that results in the consolidation of Southern Health Care, Inc. and Southern Diagnostics, Inc. All significant intercompany accounts and transactions have been eliminated in consolidation. As of the end of the second quarter, Banyan Financial Services Inc., Franchise Support Network Inc., Diagnostic USA, Inc. and Southern Diagnostics, Inc. have not commenced operations. Southern Health Care sold its chiropractic clinics effective at the end of 2004 and ceased operations.

	Going concern, results of operations and management's plans:

	The Company has incurred operating losses for several years. These losses have caused the Company to operate with limited liquidity and have created stockholders' deficit and working capital deficiencies of $427,994 and $959,223, respectively, as of September 30, 2005. These conditions raise substantial doubt about the Company's ability to continue as a going concern. Management's plans to address these concerns include the conversion of outstanding debt to equity, additional equity financing, sales of franchises, increasing collections of receivables from franchisees, developing the diagnostic imaging business, and satisfying outstanding judgements. The accompanying financial statements do not include any adjustments relating to the recoverability and classification of assets or the amounts of liabilities that might be necessary should the Company be unsuccessful in implementing these plans, or otherwise be unable to continue as a going concern.

F-26

BANYAN CORPORATION
CONDENSED NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
NINE MONTHS ENDED SEPTEMBER 30, 2005 AND 2004
(UNAUDITED)
(Expressed in US Dollars)

3.	Summary of significant accounting policies: Revenue recognition:

	Fees from franchised clinics include initial franchise fees and continuing royalty fees and marketing fees. Initial fees are recognized upon opening of a clinic, which is when the Company has performed substantially all initial services required by the franchise arrangement. Continuing fees are recognized in the period earned. Revenue from diagnostic services is recognized on estimated collection basis as the Company is entitled to 30% of gross cash collections related to diagnostic referrals made to the partnership.

	Net loss per share:

	Basic net loss per share is computed by dividing the net loss applicable to common stockholders by the weighted-average number of shares of common stock outstanding for the year. Diluted net loss per share reflects the potential dilution that could occur if dilutive securities were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the Company, unless the effect of such inclusion would reduce a loss or increase earnings per share. For the nine months ended September 30, 2005 and 2004, the effect of the inclusion of dilutive shares would have resulted in a decrease in loss per share. Accordingly, the weighted average shares outstanding have not been adjusted for dilutive shares.

4.	Intangible Asset - customer list

	In March 2005, the Company entered into an agreement with Nationwide Diagnostic Solutions, Inc. ("Nationwide") to acquire all their shares. On May 27, 2005, the Company's wholly-owned subsidiary, Diagnostic USA, Inc. assigned its right to acquire Nationwide to Southern Diagnostics, Inc. ("Southern") a newly formed Colorado holding company with no other assets, in exchange for a management agreement. Southern is wholly owned by the Company's chief executive and chief financial officer. In May 2005 Southern completed the acquisition of Nationwide for $700,000 paid in cash. The $700,000 represents the value of the customer list and is amortized over a ten-year period.

5.	Debt settlement:

	On July 13, 2005, the Company settled a dispute over certain debt instruments. Under the terms of the settlement, the Company issued 2,454,767 shares in satisfaction of $295,000 of the debt settlement amount and agreed to pay $310,000 with interest of 16% to the note holders and the former attorney of one of the note holders in monthly installments beginning September 15, 2005 until paid.

6.	Convertible notes:

Face value of notes	$	2,134,910
Less: unamortized discount		(1,028,686	)

	$	1,106,224

F-27

BANYAN CORPORATION
CONDENSED NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
NINE MONTHS ENDED SEPTEMBER 30, 2005 AND 2004
(UNAUDITED)
(Expressed in US Dollars)

6.	Convertible note (continued):

	During the period ended September 30, 2005, the Company received the second and third advance in the amount of $800,000 and $1,000,000 respectively, and 1,800,000 warrants were issued. Financing fees related to the second and third advance amounted to $241,454. The fees were capitalized and are being amortized over the two-year term of the note. The notes are due in February 2007 for the second advance and in May 2007 for the third advance.

	As a result of the advances of $800,000 and $1,000,000, a beneficial conversion in the amount of $1,200,000 has been deducted from the face value of the note and is amortized over the two-year term of the note as interest expense.

	During the period, $865,090 of the face value of the note was converted into 22,660,000 common shares. Two other convertible notes were issued during the period ended September 30, 2005 for a total of $110,000. The convertible notes can be converted at either the option of the Company or the holders for a six-month period and bear no interest. A beneficial conversion in the amount of $80,000 has been deducted from the face value of the note and is amortized over the six-month term of the note as interest expense. The face value of these notes, net of the unamortized discount in the amount $80,000 is included in current liabilities. The six-month period ended in September 2005, as of September 30, 2005 repayment of the notes was overdue.

7.	Stockholders' deficit: Preferred stock:

	The Company has 100,000,000 shares of no par value preferred stock authorized.

	Common stock:

	The Company has 500,000,000 shares of no par value common stock authorized. At September 30, 2005, there were 110,091,898 shares issued and outstanding. In addition, the Company has outstanding options of 32,035,000; outstanding warrants of 3,000,000 and 2,049,999 shares to be issued for subscriptions received before September 30, 2005.

	Stock transactions:

	During the period ended September 30, 2005, the Company sold an aggregate of 940,000 shares at less than the market value on the date of sale, for cash of $94,000 to franchisees and area developers. As the cash consideration was less than the market value on the sale dates, the Company recorded an expense of $33,500 for the effect of these discounts.

	During the period ended September 30, 2005, the Company issued 1,349,999 shares to investors for total cash consideration of $62,956.

	During the period ended September 30, 2005, the Company issued 6,127,721 shares for services, valued at $381,967, which was equal to the market price on the date of issue.

	In March 2005, the Company issued 2,300,000 shares, valued at $0.22 per share, which was equal to the market price on the date of issues, to three management and marketing consultants.

	In March 2005, the Company reissued 6,600,000 shares to its chief executive officer. The shares were valued at $990,000 and recorded against the accounts payable.

	In March 2005, the Company issued 10,047,666 shares to its chief executive officer and its president and chief financial officer in connection with the acquisition of Franchise Support Network, Inc. in May 2001.

	In June 2005, 300,000 options were exercised for services.

F-28

BANYAN CORPORATION
CONDENSED NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
NINE MONTHS ENDED SEPTEMBER 30, 2005 AND 2004
(UNAUDITED)
(Expressed in US Dollars)

7.	Stockholders' deficit (continued): Stock Options:

	During the period ended September 30, 2005, the Company granted options to purchase 7,710,000 shares of the Company's common stock at an average price of $0.12 per share to franchisees and area developers. The Company valued these options based on the Black-Scholes pricing model, resulting in recognition of compensation expense of approximately $104,600.

	During the period ended September 30, 2005, 1,810,000 options expired, 685,000 options were cancelled following the disposition of the clinics owned by Southern Health Care, Inc., and 300,000 options were exercised.

	See also Note 8 for stock options granted to related parties for which no expense has been recorded, the pro-forma impact for these options is $250,000 on net income.

8.	Related party transactions:

	As of September 30, 2005, $65,000 included in prepaid expenses is payments made in advance to the Company's chief executive officer and to the president and chief financial officer as compensation expenses.

	In March 2005, the Company reissued 6,600,000 shares to its chief executive officer.

	In April 2005, the Company granted options to purchase an aggregate of 5,000,000 shares of the Company's common stock at $0.18 per share, which was equal to the market price on the agreement date to its chief executive officer, its president and chief financial officer and a director of the Company. The options are exercisable through April 2010 and vest immediately.

	The Company retains the law partnership of its chief executive officer and its president and chief executive officer, Britannia Law Firm, to serve as its general counsel and special Canadian counsel. The Company pays Britannia a monthly retainer of $15,000. During the period ended September 30, 2005, the Company paid approximately $135,000 to Britannia for these services.

	On August 15, 2005 the Company entered into a Consulting Agreement with the father of the Chairman of the Board and Chief Executive Officer and the President and Chief Financial Officer. Under the agreement the Company issued 2,000,000 shares as consideration for consulting services valued at $80,000.

9.	Contingent liabilities:

	On September 23, 2005, the Supreme Court of Alabama reversed dismissal of a case originally filed against the Company on January 8, 2004, in Mobile County, Alabama, by a former employee of a former subsidiary. The complaint seeks money damages for breach of an alleged employment contract to issue 400,000 shares of common stock to the employee on termination and for his inability to exercise 400,000 options. The Company denies any liability and continues to vigorously defend this suit.

	During the years ended December 31, 2002 through September 30, 2005, the Company sold stock for cash. The sales were made in offerings pursuant to Section 4(2) of the Securities Act of 1933 and Regulation D thereunder. In some instances, all of which have not been identified, the Company has no business record that the purchasers made certain investment representations required under the securities laws and the Company has no business record that the purchasers received certain information required to be furnished under the foregoing laws. Under these circumstances, the affected purchasers may have potential unasserted claims for rescission of their stock purchases, although no such claims have been asserted. No estimate can be made as to the amount or range of potential loss.

F-29

BANYAN CORPORATION
CONDENSED NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
NINE MONTHS ENDED SEPTEMBER 30, 2005 AND 2004
(UNAUDITED)
(Expressed in US Dollars)

10.	Segment results:

	The Company operates in two business segments: franchising chiropractic clinics and diagnostic business. The accounting policies of the segments are the same as those described in the summary of significant accounting policies. The Company evaluates performance based on operating earnings of the respective business units.

	As of and during the three months ended September 30, 2005 and 2004, the segment results are as follows:

		2005

		Chiropractic		Diagnostic			Consolidated
		Clinics		Business	Corporate		Total

Revenues	$	230,050		146,407	-		376,457

Segment operating income (loss)		(62,478	)	73,056	(547,199	)	(536,621	)


		2004

		Chiropractic		Diagnostic			Consolidated
		Clinics		Business	Corporate		Total

Revenues	$	152,490		-	-		152,490

Segment operating income (loss)		(348,404	)	-	(424,547	)	(772,951	)

11.

Subsequent event:

On November 4, 2005, a court entered judgment in favor of four note holders and against the Company for $290,000 plus interest at 22% and cost of collection, including attorney fees. On February 8, 2006 the Court ordered this judgment vacated. On February 10, 2006, the four note holders requested the Court to reenter judgment. The Company will oppose reentry of judgment.

On December 5, 2005, a former director of the Company and his wife filed suit seeking money damages for failure to pay in full certain promissory notes in the aggregate principal amount of $86,587.50, plus accrued interest and costs, including attorney fees. The Company is vigorously defending this case.

Effective February 1, 2006, the Company hired a new Chief Operating Officer, Marshall F. Wilmot. Mr. Wilmot has overall responsibility for the day-to-day operations of the Company’s subsidiaries Chiropractic USA and Diagnostic USA. The Company’s compensation agreement with Mr. Wilmot provides for a salary of $120,000 per year, an annual bonus of up to $180,000 based upon the pre-tax earnings of Diagnostic USA in excess of $1,700,000. For his services, the Company also issued 1,000,000 shares of stock and granted 5,000,000 options exercisable at $.06 per share for five years, of which 1,666,667 vest immediately and 1,666,666 will vest on the first and second anniversary of his employment.

Effective February 8, 2006, the Company entered into a Securities Purchase Agreement (the “2006 Securities Purchase Agreement”) with AJW Partners, Inc., AJW Offshore, Ltd., AJW Qualified Partners, LLC and New Millennium Capital Partners II, LLC (hereinafter collectively referred to as the "Investors") and ancillary agreements (hereinafter described collectively as the "2006 Transaction Agreements"). Under the 2006 Securities Purchase Agreement, the Company agreed to sell the Investors a total of $3,000,000 in Callable Secured Convertible Notes (the "2006 Convertible Notes") due February 8, 2009 with 8% annual interest payable quarterly. The Investors may convert the 2006 Convertible Notes into shares at the lower of $.005 per share or 50% of the three lowest intraday trading prices during the twenty trading days prior to conversion. Based on the conversion price of $.0025 on February 7, 2006 the 2006 Convertible Notes can be converted into a minimum of 1,200,000,000 shares.

To date, the Investors have purchased $2,150,000 of the 2006 Convertible Notes. The 2006 Securities Purchase Agreement provides for the sale of an additional $850,000 of the 2006 Convertible Notes. On the last business day of each month beginning in March 2006 and ending in December 2006, the Investors will purchase from the Company $85,000 in 2006 Convertible Notes and Warrants to purchase 1,275,000 shares.

The Company agreed to issue to the Investors for no additional cash consideration Stock Purchase Warrants (the "2006 Warrants") to purchase an aggregate of 45,000,000 shares at $.001 per share, fifteen warrants for each one dollar of 2006 Convertible Notes purchased by the Investors. 32,250,000 of the 2006 Warrants have been issued as of the date hereof. The Warrants expire February 8, 2011.

Effective February 8, 2006, the Company agreed to lower the price of its earlier convertible notes to 50% of the three lowest intraday trading prices during the twenty trading days prior to conversion.

To date, the Investors have converted $1,155,162 of the 2004 Convertible Notes into 74,400,000 shares, an average of $.015 per share.

The Company recently purchased substantially all of the outstanding equity securities of the constituent entities of a diagnostic imaging business, Premier Medical Group, Inc., Premier Imaging, LLC and Premier Health Services, LLC, (hereinafter collectively referred to as “Premier”) from Dr. Brad Goldstein (“Dr. Goldstein”) the founder, owner and operator of Premier. As a result of the purchase, all of the assets and liabilities of the business have been transferred to the Company.

On February 10, 2006, the Company completed the acquisition of Premier pursuant to a Stock Purchase Agreement with Dr. Goldstein. Under the agreement, the Company paid Dr. Goldstein $2,000,000 in cash at closing plus 14,285,714 shares of common stock. The Company also agreed to pay Dr. Goldstein an additional $100,000 and an amount equal to the pre-closing accounts receivable that are actually collected, once Premier’s cash flow permits these additional payments to be made.

Dr. Goldstein entered a new one-year employment agreement with Premier effective February 10, 2006. He will earn an annual salary of $200,000 and receive a grant of stock options pursuant to our 2004 Human Resources Incentive Stock Option Plan to be determined.

F-30

PART II

INFORMATION NOT REQUIRED IN THE PROSPECTUS

Item 24. Indemnification of Directors and Officers.

Article VIII of the registrant's Articles of Incorporation provide that the registrant shall indemnify a director or officer to the full extent permitted by the Oregon Business Corporation Act as in effect at the time of the conduct by such person. As presently in effect, the general effect of the Oregon Business

II-1

Corporation Act permits a corporation to indemnify any director or officer against any judgment in connection with any proceeding, after a determination by the registrant, if the director or officer acted in good faith and if the director or officer believed his conduct was in the best interests of the registrant, except in derivative actions: (1) where the director or officer shall be adjudged liable to the registrant in the performance of such director's or officer's duty to the registrant, unless, and only to the extent, the court shall determine otherwise; (2) of amounts paid in settling or otherwise disposing of a pending action without court approval; or, (3) of expenses incurred in defending a pending action which is settled or otherwise disposed of without court approval. The registrant may advance expenses incurred by a director or officer in any proceeding if he undertakes to repay the advance if it is determined ultimately that the director or officer is not entitled to be indemnified. The registrant shall indemnify a director or officer against expenses in defense of any proceeding to the extent in which the director or officer was successful on the merits in defense. A director or officer may apply to the court or any court of competent jurisdiction for an order of indemnification. If a corporation indemnifies or advances expenses to a director or officer then the corporation shall give written notice to the shareholders prior to the next annual shareholders’ meeting.

Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

Item 25. Other Expenses of Issuance and Distribution.

The following table sets forth the estimated expenses in connection with the offering described in this Registration Statement:

SEC Registration	$ 1,600,00
Accounting Fees and Expenses	45,000.00
Legal Fees and Expenses	25,000.00
Blue Sky Fees and Expenses	1,000.00
Placement Agent Fees and Expenses	-0-
Printing Costs	5,000.00
Miscellaneous Expenses	2,400.00
TOTAL	$ 80,000.00

All of the above estimated expenses have been or will be paid by the registrant.

Item 26. Recent Sales of Unregistered Securities.

During 2003, we sold 9,989,071 shares of common stock that were not registered under the Securities Act of 1933. Of these shares, we sold 7,940,500 to 30 investors for $890,115 in cash, an average of $.11 per share. The sales to eleven of these investors involved an aggregate of 4,910,000 units consisting of one share plus one warrant expiring on or before March 31, 2005 to purchase one share of common stock at purchases prices from $.10 to $.25. Sales to four investors were the result of the investors exercising warrants they held prior to 2003 to purchase an aggregate of 350,000 shares for $35,000, or $.10 per share. Of the remaining 2,048,571 shares, we sold 1,850,571 shares to six consultants and employees in consideration for services rendered to us valued at $265,500, or an average of $.14 per share, and issued 198,000 shares to pay part of the balance due on a promissory note.

II-2

In 2004, we sold 12,520,827 shares of common stock that were not registered under the Securities Act of 1933 to 47 investors. Of these shares, we sold 9,116,827 shares for $877,470 in cash, an average of $.10 per share. The sales to two of these investors involved units consisting of one share plus one option to purchase one share of common stock. One of our investors purchased 3,125,000 shares and an option to purchase 3,125,000 shares exercisable at $.08 per share until September 15, 2007 for $250,000. Another investor purchased 1,000,000 shares and an option to purchase 1,000,000 shares exercisable at $.10 per share until May 31, 2005 for $100,000. The sales to three investors were the result of the investors exercising options they held granted prior to 2004 to purchase an aggregate of 300,000 shares for $30,000, or $.10 per share. Shares sold for consideration other than cash totaled 3,404,000. We sold 2,680,428 shares to fifteen consultants and employees in consideration for services rendered to us valued at $.12 to $.25 per share. We issued an aggregate of 720,000 shares to pay outstanding indebtedness to two creditors, including 650,000 shares to pay in full the balance due on a promissory note, and 70,000 shares to pay an account payable. We issued 3,572 shares to correct a pricing error in connection with a prior sale to an investor. Finally, we sold the convertible notes and warrants to certain purchasers in the transactions described in Certain Relationships and Related Transactions – Securities Purchase Agreements.

First quarter of 2005. We issued an aggregate of 2,300,000 shares to three management and marketing consultants for services rendered and to be rendered in 2005, valued at $.22 per share, and we sold additional convertible notes and warrants to certain purchasers in the transactions described in Certain Relationships and Related Transactions – Securities Purchase Agreements.

Second quarter of 2005. During the second quarter of 2005, we issued an aggregate of 1,277,721 shares to seven consultants for services rendered valued at $139,717, an average of $.11 per share, we sold 340,000 shares for $36,000, an average of $.11 per share to three franchisees and area developers, we sold to one investor 100,000 shares at $.10 per share, and we sold additional convertible notes and warrants to certain purchasers in the transactions described in Item 5. Other Information. In addition, we issued 300,000 shares upon the exercise of options under our 2004 Human Resources Incentive Plan for services rendered valued at the $.14 per share exercise price.

Third quarter of 2005. We issued 2,454,767 shares to partially settle threatened legal proceedings as set forth in Description of Business – Legal Proceedings.

On July 13, 2005, the Company issued 1,000,000 shares for software development services under software consulting agreement for which an $85,000 account payable was recorded at June 30, 2005 and 350,000 shares for legal consulting services. On August 12, 2005, an additional 250,000 shares were given under the software consulting agreement and an additional 500,000 shares were given for legal consulting services to adjust for a decline in the market price of the shares. These shares were registered under the Securities Act of 1933 on August 25, 2005.

On September 13, 2005, we issued 2,000,000 shares for services valued at $80,000 under the consulting agreement described in Certain Relationships and Related Transactions – Consulting Agreement.

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We sold an aggregate of 2,049,999 shares: 750,000 shares to four consultants for services rendered valued at $139,717, an average of $.11 per share; and 1,299,999 shares for $57,955, an average of $.044 per share to three franchisees and an area developer. We sold additional convertible notes and warrants, not included in the 2,049,999 shares described above, to certain purchasers in the transactions described in Certain Relationships and Related Transactions – Securities Purchase Agreements.

Fourth quarter of 2005. We gave 3,000,000 shares for legal consulting services. The shares were registered under the Securities Act of 1933 on December 16, 2005.

First quarter of 2006. We issued 2,200,000 shares to two investors upon conversion of $110,000 in outstanding convertible notes. We also issued 14,285,714 shares in connection with the business acquisition described in Certain Relationships and Related Transactions – Premier Acquisition. In addition, we issued 1,000,000 shares as compensation to our new Chief Operating Officer. See Executive Compensation—Employment and Other Compensation-Related Agreements with Management.

The sales of securities discussed above do not include shares issued to the Chief Executive Officer and the President and Chief Financial Officer in connection with certain acquisitions. Please refer to Certain Relationships and Related Transactions – Chiropractic USA and Franchise Support Network Acquisitions.

Basis of exemption from registration

We relied on the exemptions from registration afforded by Section 4(2) of the Securities Act of 1933 and Rule 506 of Regulation D of the General Rules and Regulations thereunder for the sales of shares to investors, the sale of the convertible notes and warrants and the issues to pay debt and for services. We complied with the manner of sale, access to information and investor accreditation requirements of such exemptions.

Item 27. Exhibits.

Exhibit
Number	Description

3.1	Articles of Incorporation (1)

3.2	Bylaws (1)

4.1	Specimen Common Stock Certificate (1)

4.2	Securities Purchase Agreement dated as of November 8, 2004 by and between the Registrant and the investors named therein (3)

4.3	Form of Convertible Notes due November 2006 (3)

4.4	Form of Common Stock Purchase Warrant dated as of November 8, 2004 (3)

4.5	Registration Rights Agreement dated as of November 8, 2004 by and between the Registrant and the investors named therein (3)

4.6	Security Agreement dated as of November 8, 2004 between the Registrant and the secured parties named therein (3)

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Settlement and Mutual Release Agreement among the Company and Cameron Yost, Lyle Yost, Winston Yost and Byron Yost (6)

4.7	Intellectual Property Security Agreement dated as of April 19, 2004 between the Registrant and the secured parties named therein (3)

4.8	Securities Purchase Agreement dated as of February 8, 2006 by and between the Registrant and the investors named therein (8)

4.9	Form of Convertible Notes due February 2009 (2)

4.10	Form of Common Stock Purchase Warrant dated as of February 8, 2006 (2)

4.11	Registration Rights Agreement dated as of February 8, 2006 by and between the Registrant and the investors named therein (2)

4.12	Security Agreement dated as of February 8, 2006 between the Registrant and the secured parties named therein (2)

4.13	Intellectual Property Security Agreement dated as of February 8, 2006 between the Registrant and the secured parties named therein (2)

4.14	Form of letter agreement re conversion price adjustment dated as of February 8, 2006, between the Registrant and the investors named therein (2)

5.1	Opinion and Consent of Noel Guardi, Attorney at Law (9)

10.3	Amending Agreement re: Management Agreement between the Registrant and Cory Gelmon made effective April 1, 2005 (5)

10.4	Amending Agreement between the Registrant and Michael Gelmon effective April 1, 2005 (5)

10.5	Advance Promissory Note from the Registrant to 860532 Alberta Ltd. (1)

10.6	Promissory Note from the Registrant to Eva Gelmon (1)

10.7	2004 Human Resources Incentive Plan (1)

10.8	Limited Liability Company Purchase Agreement with Exhibits (4)

10.9	Agreement re: Sale and Purchase of Assets, between the Registrant and LSI Group, LLC. effective December 31, 2004 with exhibits (5)

10.10	Purchase Agreement among the Registrant, Nationwide Diagnostic Solutions, Inc., and Jeff and Constance Rebarcak dated March 18, 2005 with exhibits (5)

10.11	Software Consulting Agreement between the Company and Fred Johanessen dated June 29, 2005 (6)

10.12	Management Agreement Between the Company and Southern Diagnostics, Inc. dated May 27, 2005 (6)

10.13	Settlement and Mutual Release Agreement among the Company and Cameron Yost, Lyle Yost, Winston Yost and Byron Yost (6)

10.14	Stock Purchase Agreement by and among Southern Diagnostics, Inc. and Jeff and Constance Rebarcak and Nationwide Diagnostic Solutions, Inc., dated May 25, 2005 (6)

10.15	Operating Agreement of Premier SD, LLC between Premier Health Services, LLC and Southern Diagnostics, Inc., dated June 8, 2005 (6)

10.16	Consulting Agreement between the Registrant and Alvin Gelmon, dated August 15, 2005 (7)

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10.17	Stock Purchase Agreement between the Registrant and Brad Goldstein et al., dated January 6, 2006 (8)

10.18	Addendum to Stock Purchase Agreement between the Registrant and Dr. Brad Goldstein et al., dated February 7, 2006 (2)

10.19	Employment Agreement between the Registrant’ subsidiary Premier Health Services, LLC and Dr. Brad Goldstein dated as of February 10, 2006 (2)

10.20	Letter agreement re offer of employment between the Registrant and Marshall Wilmot effective as of February 1, 2006 (2)

23.1	Consent of Schwartz Levitsky Feldman LLP (2)

23.2	Consent of GHP Horwath, P.C. (2)

__________________________

(1) Incorporated by reference to the correspondingly numbered exhibit to the Registrant’s registration statement on Form SB-2, registration no. 333-122815.

(2) Filed herewith.

(3) Incorporated by reference to the Registrant’s Form 10-Q SB filed with the Securities and Exchange Commission on November 22, 2004.

(4) Incorporated by reference to the Registrant’s Current Report on Form 8-K filed June 7, 2001.

(5) Incorporated by reference to the Registrant’s Form 10-KSB filed with the Securities and Exchange Commission on April 28, 2005.

(6) Incorporated by reference to the Registrant’s Form 10-QSB filed with the Securities and Exchange Commission on August 15, 2005.

(7) Incorporated by reference to the Registrant’s Form 10-QSB filed with the Securities and Exchange Commission on November 21, 2005.

(8) Incorporated by reference to the Registrant’s Form 8-K filed with the Securities and Exchange Commission on February 14, 2006.

(9) To be filed by amendment.

Item 28. Undertakings.

The undersigned registrant undertakes to:

1. File, during any period in which it offers or sells securities, a post-effective amendment to this registration statement to:

i. Include any prospectus required by section 10(a)(3) of the Securities Act;

ii. Reflect in the prospectus any facts or events which, individually or together, represent a fundamental change in the information in the registration statement; and notwithstanding the forgoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospects filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in the volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement.

iii. Include any additional or changed material information on the plan of distribution.

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2. For determining liability under the Securities Act, treat each post-effective amendment as a new registration statement of the securities offered, and the offering of the securities at that time to be the initial bona fide offering.

3. File a post-effective amendment to remove from registration any of the securities that remain unsold at the end of the offering.

Insofar as indemnification for liabilities arising under the Securities Act of 1933 (the "Act") may be permitted to directors, officers and controlling persons of the small business issuer pursuant to the foregoing provisions, or otherwise, the small business issuer has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable.

In the event that a claim for indemnification against such liabilities (other than the payment by the small business issuer of expenses incurred or paid by a director, officer or controlling person of the small business issuer in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the small business issuer will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form SB-2 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Calgary, Alberta, Canada, on February 13, 2006.

BANYAN CORP.

By /s/ Michael J. Gelmon
Michael J. Gelmon, Chief
Executive Officer

Pursuant to the requirements of the Securities Act of 1933, the registration statement has been signed by the following persons in the capacities and on the dates indicated:

/s/ Michael J. Gelmon
Michael J. Gelmon, Chief
Executive Officer and Director

Dated: February 13, 2006

/s/ Cory H. Gelmon
Cory H. Gelmon, President,
Chief Financial Officer,
Principal Accounting Officer
and Director

Dated: February 13, 2006

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