UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549  Form 10-Q (MARK ONE)xQUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the quarterly period ended March 31, 2010ORoTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACTFor the transition period from  ______________ to ______________   Commission File Number: 000-32829  ANGEL ACQUISITION CORP. (Exact name of small business issuer in its charter)   Nevada06-1588136(State of incorporation)(IRS Employer ID Number)1802 N. Carson Street, Suite 212-3018, Carson City, Nevada89701(Address of principal executive offices)(Zip Code)  (775) 887-0670 (Issuer's telephone number) N/A
(Former name, if changed since last report)   Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.   Yes x    No o  Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes ̈No ̈   Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.  1   Large accelerated filer ̈Accelerated filer ̈Non-accelerated filer ̈Smaller reporting companyx  Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes o    No x  State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: As of May 1, 2010, the issuer had 5,853,908,229 shares of its common stock issued and outstanding.  Transitional Small Business Disclosure Format (check one):  Yes o     No x        2    Table of Contents   PagePART I  FINANCIAL INFORMATIONItem 1Financial Statements3Item 2Management’s Discussion and Analysis or Plan of Operation16Item 3Quantitative and Qualitative Disclosures About Market Risk21Item 4Controls and Procedures23Item 4(T)Controls and Procedures23PART II   OTHER INFORMATIONItem 1Legal Proceedings24Item 2Unregistered Sales of Equity Securities and Use of Proceeds24Item 3Defaults Upon Senior Securities25Item 4[Removed and Reserved]25Item 5Other Information25Item 6Exhibits25Signatures27      3     PART I - FINANCIAL INFORMATION   Item 1. Financial Statements  The accompanying unaudited interim financial statements of Angel Acquisition Corp. ("Angel") have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission ("SEC"), and should be read in conjunction with the audited financial statements and notes thereto contained in Angels Annual Report filed with the SEC on Form 10-K. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim periods presented have been reflected herein. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year.        4    ANGEL ACQUISITION CORP. BALANCE SHEETS  March 31,
2010
(unaudited)December 31,
2009
(audited)Assets
Current assetsCash and cash equivalents$23,628$13,144Property, plant and equipment, net1,247,9761,254,402Property held for resale496,000496,000Other assets--Total assets1,767,6041,763,546Liabilities and Stockholders' DeficitCurrent liabilitiesNotes payable1,577,4721,572,588Accrued expenses25,70211,093Accrued derivative liability41,424280,293Due to related party536,628480,878Total current liabilities2,181,2262,344,852Notes payable, net of current maturities1,233,6141,224,508Total liabilities3,414,8403,569,360Stockholders' equitySeries A preferred stock, $.00001 par value, 10,000,000 shares authorized, 4,335,000 and 4,335,000 shares issued and outstanding, respectively4343Series B preferred stock $.00001 par value, 50,000,000 shares authorized 30,000,000 and 30,000,000 shares issued and outstanding, respectively300300Series C preferred stock, $.00001 par value, 30,000,000 shares authorized, no shares issued and outstanding, respectively--Common stock, 25,000,000,000 shares authorized, par value $.00001, 5,253,908,229 and 3,923,408,229 shares issued and outstanding, respectively52,53939,234Additional paid-in capital19,463,36719,431,562Accumulated deficit(21,163,485)(21,276,953)Total stockholders' equity (deficit)(1,647,236)(1,805,814)Total liabilities and stockholders' equity$1,767,604$1,763,546  The accompanying notes are an integral part of these financial statements.  5      ANGEL ACQUISITION CORP. STATEMENTS OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 2010 AND 2009 (UNAUDITED)  Three Months EndedThree Months EndedMarch 31, 2010March 31, 2009Revenues$29,030$48,512Cost of goods sold70033,617Gross profit28,33014,895Operating expensesGeneral and administrative16,47445,463Facilities and rent-31,981Consulting, legal and professional58,048221,200Payroll and related costs60,000-Total operating expenses134,522298,644Loss from operations(106,192)(283,749)Interest expense(19,209)(26,999)Derivative liability238,8691,451,363Net income (loss)$113,468$1,140,615Net loss per share of common stock- basic and diluted$0.00$0.00Weighted average number of shares of common stock outstanding291,959,275291,959,275  The accompanying notes are an integral part of these financial statements.    6    ANGEL ACQUISITION CORP. STATEMENTS OF CASH FLOWS FOR THE THREE MONTHS ENDED MARCH 31, 2010 (UNAUDITED)  Three Months EndedThree Months EndedMarch 31, 2010March 31, 2009Cash flows from operating activities:Net loss for the period$113,468$1,140,615Minority Interest in Net LossAdjustments to reconcile net loss to net cash used by operating activities:Accrued Derivative Liability(238,869)(1,451,363)Depreciation6,4266,426Common stock issued for services38,500417,834Changes in assets and liabilities:Other assets-69,709Accounts payable and accrued liabilities14,60936,529Net cash used in operating activities(65,866)219,750Cash flows from financing activities:Proceeds from related party84.95082,250Reduction of debt(4,100)(302,000)Paydown of credit line(4,500)-Net cash flow from financing activities76,350(219,750)Net Increase (decrease) in cash10,484-Cash at beginning of period13,144-Cash at end of period23,628-SUPPLEMENTAL CASH FLOW INFORMATION:Interest Paid$4,600$23,218SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES:Common stock issued to satisfy liabilities$50,810$-Common stock issued for services$38,500$-  The accompanying notes are an integral part of these financial statements.  7    ANGEL ACQUISITION CORP. NOTES TO UNAUDITED FINANCIAL STATEMENTS FOR THE PERIOD ENDED MARCH 31, 2010  NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS Angel Acquisition Corp. (the Company) was incorporated under the laws of the state of Nevada on March 10, 1999 under the name Palomar Enterprises, Inc. On February 5, 2008 the Company changed its name to Angel Acquisition Corp. to properly reflect the change in business direction. The Company assists private companies in the process of going public as well as being a licensed mortgage broker and developer. In April, 2008, the Board of Directors authorized the disposition of its ninety eight percent interest in The Blackhawk Fund.  As a result, the Company is accounting for the operations of The Blackhawk Fund as discontinued operations in the accompanying financial statements.  The Company has reclassified prior periods to conform to the current period NOTE 2 - PREPARATION OF FINANCIAL STATEMENTS 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 revenues and expenses during the reporting period. Actual results could differ from those estimates. Management further acknowledges that it is solely responsible for adopting sound accounting practices, establishing and maintaining a system of internal accounting control and preventing and detecting fraud. The Company's system of internal accounting control is designed to assure, among other items, that 1) recorded transactions are valid; 2) valid transactions are recorded; and 3) transactions are recorded in the proper period in a timely manner to produce financial statements which present fairly the financial condition, results of operations and cash flows of the Company for the respective periods being presented The Company is in the real estate development and mortgage business employing 13 real estate brokers. NOTE 3 - GOING CONCERN UNCERTAINTY The Company has been unable to generate sufficient operating revenues and has incurred operating losses. The Company is operating as a mortgage broker and real estate developer. However, the Company is dependent upon the available cash on hand and either future sales of securities or upon its current management and/or advances or loans from controlling shareholders or corporate officers to provide sufficient working capital. The Company has now changed its direction and while continuing in the mortgage business is now concentrating on taking private companies public. There is no assurance that the Company will be able to obtain additional funding through the sales of additional securities or, that such funding, if available, will be obtained on terms favorable to or affordable by the Company. It is the intent of management and controlling shareholders to provide sufficient working capital necessary to support and preserve the integrity of the corporate entity.  8   However, there is no legal obligation for either management and/or controlling shareholders to provide such additional funding. The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. The financial statements do not include any adjustments that might result from this uncertainty. NOTE 4 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 1. Cash and cash equivalents The Company considers all cash on hand and in banks, including accounts in book overdraft positions, certificates of deposit and other highly- liquid investments with maturities of three months or less, when purchased, to be cash and cash equivalents. 2. Basis of Presentation In April of 2008 the Company sold its subsidiary the Blackhawk Fund. (See Note 11  Discontinued Operations) On February 5, 2008 the Company effectuated a 300 to 1 reverse stock split-all financial statements have been retroactively stated to record this reverse split. 3. Research and development expenses Research and development expenses are charged to operations as incurred. There were no research and development costs incurred in the periods. 4. Advertising expenses Advertising and marketing expenses are charged to operations as incurred there were no expenses in 2010 or 2009. 5. Revenue recognition The Company generates revenue from the sale of real estate, brokerage commissions, rental properties and mortgage loan originations. Revenues from real estate sales and commissions are recognized on execution of the sales contract. The Company records gross commissions on the sales of properties closed. The Company pays the broker of record five percent of all transactions and 100 percent of personal sales. This is in accordance with standard procedures. The Company compensates its independent agents on a sliding scale between 70 and 80 percent based on productivity. The Company also recognizes sales when it sells properties that have been held for sale when their renovation is complete. Revenue is recognized at "closing". The Company has not recognized any revenue form its new business plan.
6. Income Taxes The Company utilizes the asset and liability method of accounting for income taxes. Temporary differences represent differences in the recognition of assets and liabilities for tax and financial reporting purposes, primarily accumulated depreciation and amortization. As of December 31, 2009, the deferred tax asset is related solely to the Company's net operating loss carry forward and is fully reserved.  9   7. Earnings (loss) per share Basic earnings (loss) per share are computed by dividing the net income (loss) by the weighted-average number of shares of common stock and common stock equivalents (primarily outstanding options and warrants). Common stock equivalents represent the dilutive effect of the assumed exercise of the outstanding stock options and warrants, using the treasury stock method. The calculation of fully diluted earnings (loss) per share assumes the dilutive effect of the exercise of outstanding options and warrants at either the beginning of the respective period presented or the date of issuance, whichever is later. As of March 31, 2010, the Company's outstanding warrants are considered anti-dilutive. 8. 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 revenues and expenses during the accounting period. Actual results could differ from those estimates. RECENT ACCOUNTING PRONOUNCEMENTS  In June 2009, the FASB issued authoritative guidance which will require more information about the transfer of financial assets where companies have continuing exposure to the risks related to transferred financial assets. This guidance is effective at the start of a companys first fiscal year beginning after November 15, 2009, or January 1, 2010 for companies reporting earnings on a calendar-year basis. The adoption of this guidance had no impact on the Companys consolidated financial position, results of operations, or cash flows.  In June 2009, the FASB issued authoritative guidance which will change how a company determines when an entity that is insufficiently capitalized or is not controlled through voting (or similar rights) should be consolidated. Under this guidance, determining whether a company is required to consolidate an entity will be based on, among other things, an entitys purpose and design and a companys ability to direct the activities of the entity that most significantly impact the entitys economic performance. This guidance is effective at the start of a companys first fiscal year beginning after November 15, 2009, or January 1, 2010 for companies reporting earnings on a calendar-year basis. The adoption of this guidance had no impact on the Companys consolidated financial position, results of operations, or cash flows.  Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the AICPA, and the SEC did not, or are not believed by management to, have a material impact on the Companys present or future consolidated financial statements. NOTE 5 - FAIR VALUE OF FINANCIAL INSTRUMENTS The carrying amount of cash, notes receivable, accounts payable, accrued liabilities and notes payable, as applicable, approximates fair value due to the short-term nature of these items. The fair value of the related party notes payable cannot be determined because of the Company's affiliation with the parties with whom the agreements exist. The use of different assumptions or methodologies may have a material effect on the estimates of fair values. NOTE 6 - RELATED PARTY TRANSACTIONS The Company at March 31, 2010 is indebted to its officer for $241,628 of loans and $295,000 in accrued salaries. Terms are without interest payable on demand.  10    During the quarter ending March 31, 2010, 607,000,000 shares were issued for officer debt reduction totaling $29,200. These shares were issued based upon the exemption from registration found in Section 4(2) of the Securities Act.  In addition a total of $85,950 was advanced to the company by its officers, which represented $60,000 in accrued salary and $25,950 in cash. NOTE 7  PROPERTYProperty and equipment consisted of the following at March 31, 2010:  Building$            1,395,612Office equipment27,080Total1,422,692Less: Accumulated depreciation(174,716)Property & equipment, net$            1,247,976  Assets are being depreciated from five to forty years using the straight line method.  NOTE 8 - OTHER ASSETS-PROPERTY HELD FOR RESALE  In April of 2009 the Company reacquired a residential property for sale and assumed the mortgage. The value of the property has been recorded at its appraised value which equals the amount of mortgage of $496,000 as the property is held for sale the Company is not depreciating the asset.  NOTE 9 - NOTES PAYABLE  Notes payable at March 31, 2010 are comprised of the following:  Note payable to lending institution, original balance of $980,000 interest at 7.5% per annum. Requires monthly principal and interest payments of 6,852 through 2034. Collateralized by building.$                 748,508Convertible debentures payable to an investor group, interest at 8% due no later than March 2009.1,046,443Mortgage payable secured by a building, 7.875% interest only for ten years496,000Convertible note to investors past due  20% interest35,029Credit line from a bank up to 500,000 interest only at one percent over prime.495,000Total$                 2,820,980Less current portion1,577,472Total long-term portion$                 1,243,508  NOTE 10 - LEASES  Our corporate headquarters are located in Carson City, Nevada, whereby we lease space for approximately $100 a month.  The lease is scheduled to expire on December 31, 2010.  11  NOTE 11 - DISCONTINUED OPERATIONS In April 2008 the Company authorized the disposal of its ninety eight percent interest in The Blackhawk Fund.  The Company sold the stock in its subsidiary to an unrelated third party for $463,000, consisting of $463,000 in cash. The company recognized a gain on the sale of $85,752. Included in notes receivable is an amount due from the former subsidiary of $720,896 due without interest upon demand, which has been reserved for in full as doubtful to collect at December 31, 2008. Income (loss) from discontinued operations consists of direct revenues and direct expenses of The Blackhawk Fund.  A summary of the operating results included in discontinued operations in the accompanying statement of operations is a follows:  Year EndedDecember 31,20082007Revenues$     15,200$305,908Cost of goods sold-234,231Gross profit-71,677Operating expenses(229,690)2,208,359Loss from operations(214,490)(2,136,682)Other expense(44,417)(181,968)Net loss$  (258,907)$(2,318,650)  The March 31, 2008 financial statements presented has been adjusted to reflect the discontinued operation during that period.   NOTE 12 - DERIVATIVE LIABILITY  The Company is accounting for the conversion option in the Convertible Note and the conversion price in the Securities Purchase Agreement and the associated warrants as derivative liabilities in accordance with FASB ASC Topic regarding, Accounting for Derivative Instruments and Hedging Activities and FASB ASC Topic regarding Accounting for Derivative Financial Instruments Indexed to and Potentially Settled in a Companys Own Stock due to the fact that the conversion feature and the warrants both have a variable conversion price. The fair value of the Convertible Note was determined utilizing the Black-Scholes stock option valuation model.  The significant assumptions used in the valuation are:  the exercise price as noted above; the stock price as of March 31, 2010; expected volatility of 66%; risk free interest rate of approximately 4.50%; and a term of one year.   12   NOTE 13  STOCKHOLDERS EQUITY Preferred Stock  During the year ended December 31, 2009, the Company converted 100,000 shares of Series A preferred stock into 100,000,000 shares of common stock. These shares were issued based upon the exemption from registration found in Section 4(2) of the Securities Act.  In connection with Brent Fouchs resignation from his position as Treasurer, Chief Financial Officer and Director of the Company effective January 26, 2009, Mr. Fouch returned 4,565,000 shares of Series A preferred stock beneficially  to the Companys treasury which was beneficially held by him.  Common Stock  During the quarter ended March 31, 2010, the
Company issued 1,387,500,000 shares for debt reduction totaling $50,810 and
cancelled 442,000,000 shares that had previously been issued during the year
ended December 31, 2009 for debt reduction of $44,200.  During quarter ending March 31, 2010, the
Company issued 385,000,000 shares for services valued at $38,500. These shares
were issued under an S-8 registration statement.  NOTE 14 - SUBSEQUENT EVENTS  Subsequent to the quarter ended March 31,
2010, the Company issued 600,000,000 shares for debt reduction totaling $35,000.  13    ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS  Forward-Looking Information  Much of the discussion in this Item is "forward looking" as that term is used in Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934. Actual operations and results may materially differ from present plans and projections due to changes in economic conditions, new business opportunities, changed business conditions, and other developments. Other factors that could cause results to differ materially are described in our filings with the Securities and Exchange Commission.  There are several factors that could cause actual results or events to differ materially from those anticipated, and include, but are not limited to general economic, financial and business conditions, changes in and compliance with governmental laws and regulations, including various state and federal environmental regulations, our ability to obtain additional financing from outside investors and/or bank and mezzanine lenders and our ability to generate sufficient revenues to cover operating losses and position us to achieve positive cash flow. Readers are cautioned not to place undue reliance on the forward-looking statements contained herein, which speak only as of the date hereof. We believe the information contained in this Form 10-Q to be accurate as of the date hereof. Changes may occur after that date. We will not update that information except as required by law in the normal course of its public disclosure practices. Additionally, the following discussion regarding our financial condition and results of operations should be read in conjunction with the financial statements and related notes contained in Item 1 of Part I of this Form 10-Q, as well as the financial statements in Item 8 of Part II of our Form 10-K for the fiscal year ended, December 31, 2009.  Angel Acquisition Corp. Angel Acquisition Corp. is a diversified asset management company that acquires and/or develops profitable companies. Angel Acquisition Corp. either obtains a majority of stock in each company they gain control of or, the company internally develops profitable enterprises. Through the acquisition and development of profitable companies and the expansion of internal divisions, Angel Acquisition Corp. has the ability to experience growth through diverse holdings. Companies turning large profits are analyzed and considered for acquisition. The company operates two divisions: A. The Palomar Group: the financial services division. B. Angels In Action: the micro-lending division.  Our Divisions  The Palomar Group is a full service, real estate and residential lending company. We offer these programs:  14  Home Loans
  Refinancing Opportunities
  Discount Programs We are staffed by top producing agents, and work with the countrys top lenders to expediently and efficiently exceed your expectations and meet your real estate and lending needs. http://www.thepalomargroup.com  Angels in Action is committed to changing the direction of our nations local economies, one business at a time. We have built an online Microfinance community where entrepreneurs and patrons come together to form virtual business incubators. Our mission is to ensure that the entrepreneurial spirit on which our country was founded is able to flourish in the communities in which we live and work. http://www.angelsinaction.tv  KEY PERSONNEL  Our future financial success depends to a large degree upon the effort of Mr. Bonenberger, our sole officer. Mr. Bonenberger has played a major role in developing and executing our business strategy. The loss of Mr. Bonenberger could have an adverse effect on our business and our chances for profitable operations. While we intend to employ additional management and marketing personnel in order to minimize the critical dependency upon any one person, there can be no assurance that we will be successful in attracting and retaining the persons needed. If we do not succeed in retaining and motivating our current employees and attracting new high quality independent agents, our business could be adversely affected.  We do not maintain key man life insurance on the life of Mr. Bonenberger.  OUR FINANCIAL RESULTS MAY BE AFFECTED BY FACTORS OUTSIDE OF OUR CONTROL  Our future operating results may vary significantly from quarter to quarter due to a variety of factors, many of which are outside our control. Our anticipated expense levels are based, in part, on our estimates of future revenues and may vary from our projections. We may be unable to adjust spending rapidly enough to compensate for any unexpected revenues shortfall. Accordingly, any significant shortfall in revenues in relation to our planned expenditures would materially adversely affect our business, operating results, and financial condition.  We cannot predict with certainty our revenues and operating results. Further, we believe that period-to-period comparisons of our operating results are not necessarily a meaningful indication of future performance.  CORPORATE OFFICES  Our executive office is located at: 2585 Pio Pico Carlsbad, CA 92008.  15   EMPLOYEES  We have one full-time employee and three part-time employees as of March 31, 2010. We also have three independent agents working for the Company. As we grow, we will need to attract an unknown number of additional qualified employees and independent agents. Although we have experienced no work stoppages and believe our relationships with our employees are good, we could be unsuccessful in attracting and retaining the persons needed. None of our employees are currently represented by a labor union. We expect to have a ready source of available labor to support our growth.  MARKETS AND MARKETING:  We currently have the following operating divisions:  Financial Services Division:  Focused upon mortgage and home loan origination, real state sales and client services, property acquisition and development. This division operates from the facility owned by us and located at 2585 Pio Pico Drive in Carlsbad, California. The division was established in the third fiscal quarter of 2003 and is currently operating and generating revenue. We currently have three independent real estate agents and loan brokers.   Our goal is to double the work force of the Financial Services Division in the fiscal year 2010. For further reference, please visit http://www.angelacquisitions.com.  Micro-loan Division: Angels in Action is committed to changing the direction of our nations local economies, one business at a time. We have built an online Microfinance community where entrepreneurs and patrons come together to form virtual business incubators. Our mission is to ensure that the entrepreneurial spirit on which our country was founded is able to flourish in the communities in which we live and work. For further reference, please visit: http://www.angelsinaction.tv  We believe that building awareness of our company is important in expanding our customer base. We currently advertise over the Internet via our website, newspaper and direct mail. We also rely upon referrals from past and current customers, as well as from personal and professional contacts of our management and independent contractors. The recurring costs of our marketing efforts have risen commensurate with our revenue.  We cannot assure you that we will be successful in attracting new customers, or retaining the future business of existing customers. If we fail to attract and retain customers, we would be unable to generate revenues to support continuing operations.  Management's Plan of Operations  Results of Operations  Continuing operations  Revenue  16    Three months ended March 31, 2010, compared to the three months ended March 31, 2009. Total revenues were at $29,030 for the three months ended March 31, 2010 compared to $48,512 for the prior period, a decrease of 19,482.  Sales decrease is a result economic factors in the real estate industry as well as us beginning to concentrate on our new business plan.  Total operating expenses for the three months ended March 31, 2010 compared to 2009 decreased to $134,522 from $298,644 in the prior period. This decrease was a result of less consulting, legal and professional fees and general and administrative as we substantially reduced costs to only those of an essential element.  Net loss from operations for the three months ended March 31, 2010 was $106,192.     Liquidity and Capital Resources  As of March 31, 2010, we had a deficiency in working capital of $2,157,598.  Critical Accounting Policies  The preparation of our consolidated financial statements in conformity with accounting principles generally accepted in the United States requires us to make estimates and judgments that affect our reported assets, liabilities, revenues, and expenses, and the disclosure of contingent assets and liabilities. We base our estimates and judgments on historical experience and on various other assumptions we believe to be reasonable under the circumstances. Future events, however, may differ markedly from our current expectations and assumptions. While there are a number of significant accounting policies affecting our consolidated financial statements, we believe the following critical accounting policy involve the most complex, difficult and subjective estimates and judgments.  Stock-Based Compensation  In December 2002, the FASB issued SFAS No. 148 - Accounting for Stock-Based Compensation - Transition and Disclosure. This statement amends SFAS No. 123- Accounting for Stock-Based Compensation, providing alternative methods of voluntarily transitioning to the fair market value based method of accounting for stock based employee compensation. FAS 148 also requires disclosure of the method used to account for stock-based employee compensation and the effect of the method in both the annual and interim financial statements. The provisions of this statement related to transition methods are effective for fiscal years ending after December 15, 2002, while provisions related to disclosure requirements are effective in financial reports for interim periods beginning after December 31, 2002. We elected to continue to account for stock-based compensation plans using the intrinsic value-based method of accounting prescribed by APB No. 25, "Accounting for Stock Issued to Employees," and related interpretations. Under the provisions of APB No. 25, compensation expense is measured at the grant date for the difference between the fair value of the stock and the exercise price.  Recent Accounting Pronouncements In July 2006, the FASB issued Interpretation No. 48, "Accounting for Uncertainty in Income Taxes" ("FIN 48"). FIN 48 clarifies the accounting for uncertainty in income taxes recognized in an enterprises' financial statements in accordance with SFAS No. 109, "Accounting for Income Taxes". FIN 48 prescribes a recognition threshold and measurement attributable for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. FIN 48 also provides guidance on derecognizing, classification, interest and penalties, accounting in interim periods, disclosures and transitions. FIN 48 is effective for fiscal years beginning after December 15, 2006. The Company is currently reviewing the effect, if any, FIN 48 will have on its financial position and operations.  17   In September 2006, the FASB issued SFAS No. 157, "Fair Value Measures" ("SFAS No. 157"). SFAS No157 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles ("GAAP"), expands disclosures about fair value measurements, and applies under other accounting pronouncements that require or permit fair value measurements. SFAS No. 157 does not require any new fair value measurements, however the FASB anticipates that for some entities, the application of SFAS No. 157 will change current practice. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007, which for the Company would be its fiscal year beginning November 1, 2008. The implementation of SFAS No. 157 is not expected to have a material impact on the Company's results of operations and financial condition.   In September 2006, the Financial Accounting Standards Board ("FASB") issued SFAS No. 158, "Employers' Accounting for Defined Benefit Pension and Other Postretirement Plans - an amendment of FASB Statements No. 87, 88, 106, and 132(R)". This statement requires employers to recognize the overfunded or underfunded status of a defined benefit postretirement plan (other than a multi-employer plan) as an asset or liability in its statement of financial position and to recognize changes in that funded status in the year in which the changes occur through comprehensive income of a business entity or changes in unrestricted net assets of a not-for-profit organization. This statement also requires an employer to measure the funded status of a plan as of the date of its year-end statement of financial position, with limited exceptions. The provisions of SFAS No. 158 are effective for employers with publicly traded equity securities as of the end of the fiscal year ending after December 15, 2006. The adoption of this statement is not expected to have a material effect on the Company's future reported financial position or results of operations.  In September 2006, the Securities and Exchange Commission ("SEC") issued Staff Accounting Bulletin No. 108 (Topic 1N), "Quantifying Misstatements in Current Year Financial Statements" ("SAB No. 108"). SAB No. 108 addresses how the effect of prior year uncorrected misstatements should be considered when quantifying misstatements in current year financial statements. SAB No. 108 requires SEC registrants (i) to quantify misstatements using a combined approach which considers both the balance sheet and income statement approaches; (ii) to evaluate whether either approach results in quantifying an error that is material in light of relevant quantitative and qualitative factors; and (iii) to adjust their financial statements if the new combined approach results in a conclusion that an error is material. SAB No. 108 addresses the mechanics of correcting misstatements that include effects from prior years. It indicates that the current year correction of a material error that includes prior year effects may result in the need to correct prior year financial statements even if the misstatement in the prior year or years is considered immaterial. Any prior year financial statements found to be materially misstated in years subsequent to the issuance of SAB No. 108 would be restated in accordance with SFAS No. 154, "Accounting Changes and Error Corrections." Because the combined approach represents a change in practice, the SEC staff will not require registrants that followed an acceptable approach in the past to restate prior years' historical financial statements. Rather, these registrants can report the cumulative effect of adopting the new approach as an adjustment to the current year's beginning balance of retained earnings. If the new approach is adopted in a quarter other than the first quarter, financial statements for prior interim periods within the year of adoption may need to be restated. SAB No. 108 is effective for fiscal years ending after November 15, 2006, which for Company would be its fiscal year beginning December 1, 2007. The implementation of SAB No. 108 is not expected to have a material impact on the Company's results of operations and financial condition.  Off-Balance Sheet Arrangements  We do not have any off-balance sheet arrangements.   ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES OF MARKET RISK  We Have Historically Lost Money and Losses May Continue in the Future  We have historically lost money.  However, the Company reported income of $500,928 during the year ended December 31, 2009. We may experience significant liquidity and cash flow problems if we are not able to raise additional capital as needed and on acceptable terms.  No assurances can be given we will be successful in reaching or maintaining profitable operations.  18      We Will Need to Raise Additional Capital to Finance Operations  Our operations have relied almost entirely on external financing to fund our operations.  Such financing has historically come from a combination of borrowings and from the sale of common stock and assets to third parties.  We will need to raise additional capital to fund our anticipated operating expenses and future expansion.  Among other things, external financing will be required to cover our operating costs.  We cannot assure you that financing whether from external sources or related parties will be available if needed or on favorable terms.  The sale of our common stock to raise capital may cause dilution to our existing shareholders.  Our inability to obtain adequate financing will result in the need to curtail business operations.  Any of these events would be materially harmful to our business and may result in a lower stock price.  There is Substantial Doubt About Our Ability to Continue as a Going Concern Due to Recurring Losses and Working Capital Shortages, Which Means that We May Not Be Able to Continue Operations Unless We Obtain Additional Funding  The report of our independent accountants on our December 31, 2009 financial statements include an explanatory paragraph indicating that there is substantial doubt about our ability to continue as a going concern due to recurring losses and working capital shortages.  Our ability to continue as a going concern will be determined by our ability to obtain additional funding.  Our financial statements do not include any adjustments that might result from the outcome of this uncertainty.  Our Common Stock May Be Affected By Limited Trading Volume and May Fluctuate Significantly  There has been a limited public market for our common stock and there can be no assurance that an active trading market for our common stock will develop.  As a result, this could adversely affect our shareholders' ability to sell our common stock in short time periods, or possibly at all.  Our common stock has experienced, and is likely to experience in the future, significant price and volume fluctuations that could adversely affect the market price of our common stock without regard to our operating performance.  In addition, we believe that factors such as quarterly fluctuations in our financial results and changes in the overall economy or the condition of the financial markets could cause the price of our common stock to fluctuate substantially. Substantial fluctuations in our stock price could significantly reduce the price of our stock.  There is no Assurance of Continued Public Trading Market and Being a Low Priced Security may Affect the Market Value of Our Stock  To date, there has been only a limited public market for our common stock. Our common stock is currently quoted on the OTCBB. As a result, an investor may find it difficult to dispose of, or to obtain accurate quotations as to the market value of our stock. Our stock is subject to the low-priced security or so called "penny stock" rules that impose additional sales practice requirements on broker-dealers who sell such securities. The Securities Enforcement and Penny Stock Reform Act of 1990 requires additional disclosure in connection with any trades involving a stock defined as a penny stock (generally, according to recent regulations adopted by the SEC, any equity security that has a market price of less than $5.00 per share, subject to certain exceptions that we no longer meet). For example, brokers/dealers selling such securities must, prior to effecting the transaction, provide their customers with a document that discloses the risks of investing in such securities. Included in this document are the following:  19     - the bid and offer price quotes in and for the "penny stock," and the number of shares to which the quoted prices apply,  - the brokerage firm's compensation for the trade, and  - the compensation received by the brokerage firm's sales person for the trade.  In addition, the brokerage firm must send the investor:  - a monthly account statement that gives an estimate of the value of each "penny stock" in the investor's account, and  - a written statement of the investor's financial situation and investment goals.  If the person purchasing the securities is someone other than an accredited investor or an established customer of the broker/dealer, the broker/dealer must also approve the potential customer's account by obtaining information concerning the customer's financial situation, investment experience and investment objectives. The broker/dealer must also make a determination whether the transaction is suitable for the customer and whether the customer has sufficient knowledge and experience in financial matters to be reasonably expected to be capable of evaluating the risk of transactions in such securities. Accordingly, the Commission's rules may limit the number of potential purchasers of the shares of our common stock.  Resale restrictions on transferring "penny stocks" are sometimes imposed by some states, which may make transaction in our stock more difficult and may reduce the value of the investment. Various state securities laws pose restrictions on transferring "penny stocks" and as a result, investors in our common stock may have the ability to sell their shares of our common stock impaired.  There can be no assurance we will have market makers in our stock. If the number of market makers in our stock should decline, the liquidity of our common stock could be impaired, not only in the number of shares of common stock which could be bought and sold, but also through possible delays in the timing of transactions, and lower prices for the common stock than might otherwise prevail. Furthermore, the lack of market makers could result in persons being unable to buy or sell shares of the common stock on any secondary market.  We Could Fail to Retain or Attract Key Personnel  Our future success depends in significant part on the continued services of Steve Bonenberger, our Chief Executive Officer.  We cannot assure you we would be able to find an appropriate replacement for key personnel.  Any loss or interruption of our key personnel's services could adversely affect our ability to develop our business plan.  We do not have life insurance on Mr. Bonenberger.  Nevada Law and Our Charter May Inhibit a Takeover of Our Company That Stockholders May Consider Favorable  Provisions of Nevada law, such as its business combination statute, may have the effect of delaying, deferring or preventing a change in control of our company.  As a result, these provisions could limit the price some investors might be willing to pay in the future for shares of our common stock.  ITEM 4. CONTROLS AND PROCEDURES  Evaluation of Disclosure Controls and Procedures   20    We maintain disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (the Exchange Act) that are designed to be effective in providing reasonable assurance that information required to be disclosed in our reports under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission (the SEC), and that such information is accumulated and communicated to our management to allow timely decisions regarding required disclosure.  In designing and evaluating disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable, not absolute assurance of achieving the desired objectives. Also, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. The design of any system of controls is based, in part, upon certain assumptions about the likelihood of future events and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.  As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of management, including our chief executive officer and principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based upon that evaluation, management concluded that our disclosure controls and procedures are effective as of March 31, 2010 to cause the information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods prescribed by SEC, and that such information is accumulated and communicated to management, including our chief executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.  ITEM 4(T). CONTROLS AND PROCEDURES  Evaluation of and Report on Internal Control over Financial Reporting  The management of Angel Acquisition Corp. is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rule 13a-15(f) or 15d-15(f) promulgated under the Securities Exchange Act of 1934 as a process designed by, or under the supervision of, the companys principal executive and principal financial officers and effected by the companys board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America and includes those policies and procedures that:  −Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the company;−Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States of America and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and−Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company’s assets that could have a material effect on the financial statements.   21    Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Because of the inherent limitations of internal control, there is a risk that material misstatements may not be prevented or detected on a timely basis by internal control over financial reporting. However, these inherent limitations are known features of the financial reporting process. Therefore, it is possible to design into the process safeguards to reduce, though not eliminate, this risk.  Management assessed the effectiveness of the Companys internal control over financial reporting as of March 31, 2010. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control-Integrated Framework.  Based on its assessment, management concluded that, as of March 31, 2010, the Companys internal control over financial reporting is effective based on those criteria.  This quarterly does not include an attestation report of the Companys registered accounting firm regarding internal control over financial reporting.  Managements report is not subject to attestation by the Companys registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission.  Changes in Internal Control over Financial Reporting  There was no change in our internal controls over financial reporting identified in connection with the requisite evaluation that occurred during our last fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.  PART II - OTHER INFORMATION  ITEM 1. LEGAL PROCEEDINGS.  None.   ITEM 1A. RISK FACTORS  Not applicable.  ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.  During the quarter ended March 31, 2010, the
Company issued 1,387,500,000 shares for debt reduction totaling $50,810 and
cancelled 442,000,000 shares that had previously been issued during the year
ended December 31, 2009 for debt reduction of $44,200.  During quarter ending March 31, 2010, the
Company issued 385,000,000 shares for services valued at $38,500. These shares
were issued under an S-8 registration statement.  Subsequent to the quarter ended March 31,
2010, the Company issued 600,000,000 shares for debt reduction totaling $35,000.    ITEM 3. DEFAULTS UPON SENIOR SECURITIES   None.  ITEM 4. [REMOVED AND RESERVED]  22    ITEM 5. OTHER INFORMATION  None           ITEM 6. EXHIBITS   Exhibit No.Identification of Exhibit3.1**Articles of Incorporation.3.2**Articles of Amendment to Articles of Incorporation.3.3**Articles of Amendment to Articles of Incorporation3.4**Certificate of Change.3.5**Certificate of Correction to the Certificate of Change.3.6**Certificate of Amendment to the Certificate of Designation for the Series B Preferred Stock.3.7**Certificate of Designation for the Series A Preferred Stock.3.8**Certificate of Designation for the Series C Preferred Stock.3.9**Articles of Amendment to Articles of Incorporation3.10 **Articles of Amendment to Articles of Incorporation3.11**Bylaws.10.1*Steven Bonenberger Employment Agreement dated January 1, 200914**Code of Ethics21**Subsidiaries31.1*Certification of Steven Bonenberger, President, Director and Chief Executive Officer of Angel Acquisition Corp., pursuant to 18 U.S.C. 1350, as adopted pursuant to 302 of the Sarbanes-Oxley Act of 2002.31.2*Certification of Steve Bonenberger, Treasurer, Chief Financial Officer and Director of Angel Acquisition Corp., pursuant to 18 U.S.C. Sec. 1350, as adopted pursuant to Sec. 302 of the Sarbanes-Oxley Act of 2002.32.1*Certification of Steven Bonenberger, President, Director and Chief Executive Officer of Angel Acquisition Corp., pursuant to 18 U.S.C. Sec. 1350, as adopted pursuant to Sec. 906 of the Sarbanes-Oxley Act of 2002.32.2*Certification of Steve Bonenberger, Treasurer, Chief Financial Officer and Director of Angel Acquisition Corp., pursuant to 18 U.S.C Sec. 1350, as adopted pursuant to Sec. 906 of the Sarbanes-Oxley Act of 2002.  * Filed herewith.   ** Previously Filed      23   SIGNATURES  In accordance with the requirements of the Exchange Act, the Registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.  Angel Acquisition Corp.Dated: May 24, 2010By:/s/  Steve BonenbergerSteve BonenbergerPresident, Chief Executive Officer and Director           24