Item 1.01 Entry into a Material Definitive Agreement

On August 14, 2006, Clear Choice Financial, Inc. (the “Company”) entered into a Stock Purchase Agreement with its President, Mr. Stephen Luke, for the purchase by the Company of 5,952,245 shares of the Company’s common stock held by Mr. Luke (the “Shares”). The purchase price for the Shares is $2 million, which is payable to Mr. Luke as follows: (a) $500,000 upon the initial closing, which is scheduled for September 1, 2006 or earlier, and (b) three successive $500,000 payments to be paid by the Company to Mr. Luke every 90 days thereafter. In connection with the Stock Purchase Agreement, Mr. Luke tendered his resignation from the Company, effective immediately, and the Company and Mr. Luke delivered mutual releases of any and all claims by either party against the other.

Concurrent with the execution of the Stock Purchase Agreement, the Company also entered into a Stock Pledge Agreement between the Company and Mr. Luke, which granted to Mr. Luke a security interest in the Shares in order to secure the Company’s payment obligations under the Stock Purchase Agreement. The Stock Pledge Agreement contained standard terms and conditions for an agreement of its kind.

Item 1.02 Termination of a Material Definitive Agreement

Pursuant to the terms of the Stock Purchase Agreement, described under Item 1.01 above, Mr. Luke will cause that certain Lease Agreement, dated April 1, 2004, as amended, between Shalimar Offices, LLC and the Company, with respect to the premises located in Tempe, Arizona, to be terminated as of December 31, 2006, thereby releasing the Company from any future obligations thereunder, including payment obligations. Mr. Luke is the manager of Shalimar Offices, LLC and owns all of its outstanding interests. There are no penalties for early termination.

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant

The discussion set forth under Item 1.01 is incorporated herein by reference. As part of the terms and conditions of the Stock Purchase Agreement, the Company is obligated to pay Mr. Luke as follows: (a) $500,000 upon the initial closing, which is scheduled for September 1, 2006 or earlier, and (b) three successive $500,000 payments to be paid by the Company to Mr. Luke every 90 days thereafter. The company’s payment obligations are secured by a pledge of the Shares but Mr. Luke is not limited to this as a remedy and may seek specific performance.

Item 5.02 Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers

The discussion set forth under Item 1.01 is incorporated herein by reference. As part of the terms and conditions of the Stock Purchase Agreement, Mr. Luke tendered his resignation as President of the Company, effective August 14, 2006. Mr. Luke is no longer an officer, director or employee of the Company.