UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


Washington,
D.C. 20549





FORM
10-K





(Mark
One)





þANNUAL REPORT UNDER
SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


For the
fiscal year ended December
31, 2008


or





o TRANSITION REPORT
UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


For the
transition period from ______________ to ________________





Commission
file number 333-150266





BNH
  INC.(Exact
      name of registrant as specified in its charter)Nevada
                      
                      92-0189305(State
      or other jurisdiction of
                        incorporation
      or organization)
                      
                      (I.R.S.
      Employer Identification No.)c/o
      Nehemya Hesin
                        29
      Rashbi St. Apt # 19
                        Modiin
      Illit, Israel
                      
                      71919(Address
      of principal executive offices)
                      
                      (Zip
      Code)011-972-545-681-953(Registrant’s
      telephone number, including area
code)




Securities
      registered pursuant to Section 12(b) of the Act:N/A
                  
                  N/ATitle
      of each Class
                  
                  Name
      of each exchange on which registeredSecurities
      registered pursuant to section 12(g) of the Act:Shares
      of Common Stock, $0.001 par valueTitle
      of Class





Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act.


Yes o No þ





Indicate
by check mark if the registrant is not required to file reports pursuant to
Section 13 or Section 15(d) of the Act. Yes o No þ





Indicate
by check mark whether the registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days. Yes þ No o





Indicate
by check mark if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K (§ 229.405 of this chapter) is not contained herein, and will not
be contained, to the best of registrant’s knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K. þ





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.





Large
accelerated filer o         Accelerated
filer o         Non-accelerated
filer o         Smaller
reporting company þ





Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Act). Yes o No þ





The
aggregate market value of the voting and non-voting common equity held by
non-affiliates computed by reference to the price at which the common equity was
last sold, or the average bid and asked price of such common equity, as of
December 31, 2008, the last business day of the registrant’s most recently
completed fourth fiscal quarter, was $175,000.





Indicate
the number of shares outstanding of each of the registrant’s classes of common
stock, as of the latest practicable


date.
7,000,000 shares of common
stock as of February 10, 2009.





DOCUMENTS
INCORPORATED BY REFERENCE




Exhibits
incorporated by reference are referred under Part IV.








TABLE
OF CONTENTS





PageFORM
      10-KPART
      I
                                                                                                                    
                                                                                                                    
                                                                                                                    1ITEM
      1.
                                                                                                                    BUSINESS
                                                                                                                    
                                                                                                                    1ITEM
      2.
                                                                                                                    PROPERTIES
                                                                                                                    
                                                                                                                    5ITEM
      3.
                                                                                                                    LEGAL
      PROCEEDINGS
                                                                                                                    
                                                                                                                    5ITEM
      4.
                                                                                                                    SUBMISSION
      OF MATTERS TO A VOTE OF SECURITY HOLDERS
                                                                                                                    
                                                                                                                    5PART
      II
                                                                                                                    
                                                                                                                    
                                                                                                                    6ITEM
      5.
                                                                                                                    MARKET
      FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER
      PURCHASES OF EQUITY SECURITIES
                                                                                                                    
                                                                                                                    6ITEM
      6.
                                                                                                                    SELECTED
      FINANCIAL DATA
                                                                                                                    
                                                                                                                    6ITEM
      7.
                                                                                                                    MANAGEMENT’S
      DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
      OPERATIONS
                                                                                                                    
                                                                                                                    7ITEM
      8.
                                                                                                                    FINANCIAL
      STATEMENTS AND SUPPLEMENTARY DATA
                                                                                                                    
                                                                                                                    10ITEM
      9.
                                                                                                                    CHANGES
      IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
      DISCLOSURE
                                                                                                                    
                                                                                                                    10ITEM
      9A.
                                                                                                                    CONTROLS
      AND PROCEDURES
                                                                                                                    
                                                                                                                    10ITEM
      9B.
                                                                                                                    OTHER
      INFORMATION
                                                                                                                    
                                                                                                                    11PART
      III
                                                                                                                    
                                                                                                                    
                                                                                                                    11ITEM
      10.
                                                                                                                    DIRECTORS,
      EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
                                                                                                                    
                                                                                                                    11ITEM
      11.
                                                                                                                    EXECUTIVE
      COMPENSATION
                                                                                                                    
                                                                                                                    12ITEM
      12.
                                                                                                                    SECURITYOWNERSHIPOF
      CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER
      MATTERS
                                                                                                                    
                                                                                                                    14ITEM
      13.
                                                                                                                    CERTAIN
      RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
      INDEPENDENCE
                                                                                                                    
                                                                                                                    15ITEM
      14.
                                                                                                                    PRINCIPAL
      ACCOUNTING FEES AND SERVICES
                                                                                                                    
                                                                                                                    16PART
      IV
                                                                                                                    
                                                                                                                    
                                                                                                                    16ITEM
      15.
                                                                                                                    EXHIBITS,
      FINANCIAL STATEMENT SCHEDULES
                                                                                                                    
                                                                                                                    16SIGNATURES
                                                                                                                    
                                                                                                                    17








Forward
Looking Statements





This
annual report contains forward-looking statements within the meaning of Section
27A of the Securities Actof 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of
1934, as amended (the “Exchange Act”). These forward-looking statements relate
to future events or our future financial performance. In some cases, you can
identify forward-looking statements by terminology such as “may”, “should”,
“expects”, “plans”, “anticipates”, “believes”, “estimates”, “predicts”,
“potential” or “continue” or the negative of these terms or other comparable
terminology. These forward-looking statements are only predictions and involve
known and unknown risks, uncertainties and other factors, including the risks
set out in the section entitled “Risk Factors” in the Registration Statement on
Form S-1 that went effective as of April 30, 2008 and the risks set out below,
any of which may cause our or our industry’s actual results, levels of activity,
performance or achievements to be materially different from any future results,
levels of activity, performance or achievements expressed or implied by these
forward-looking statements. These risks include, by way of example and not in
limitation:





·
            risks
      related to our ability to continue as a going
  concern;


·
            the
      uncertainty of profitability based upon our history of
    losses;


·
            risks
      related to failure to obtain adequate financing on a timely basis and on
      acceptable terms for our planned development
  projects;


·
            risks
      related to environmental regulation and
  liability;


·
            risks
      related to tax assessments;


·
            risks
      and uncertainties related to our prospects, properties and business
      strategy; and


·
            risks
      related to the armed conflict in southern
  Israel.





The above
list is not an exhaustive list of the factors that may affect any of our
forward-looking statements. These and other factors should be considered
carefully and readers should not place undue reliance on our forward-looking
statements.





Forward
looking statements are made based on management’s beliefs, estimates and
opinions on the date the forward-looking statements are made, and we undertake
no obligation to update forward-looking statements should these beliefs,
estimates and opinions or other circumstances change. Although we believe that
the expectations reflected in the forward-looking statements are reasonable, we
cannot guarantee future results, levels of activity, performance or
achievements. Except as required by applicable law, including the securities
laws of the United States, we do not intend to update any of the forward-looking
statements to conform these forward-looking statements to actual
results.





Our
financial statements are stated in United States dollars (“US$”) and are prepared in
accordance with United States generally accepted accounting principles (“GAAP”).





In this
annual report, unless otherwise specified, all dollar amounts are expressed in
United States dollars and all references to "common stock" refer to the shares
of our common stock.





As used
in this annual report, the terms "we", "us", "our", "BNH" and “Issuer” mean BNH
Inc. unless the context clearly requires otherwise.








PART
I





ITEM
      1.
            BUSINESS





Form and year of
organization





We were
incorporated on September 4, 2007, in the State of Nevada. Our authorized
capital consists of 105,000,000 shares of our common stock (the “Common Shares”)
with a par value of $0.001 per Common Share.





Our
principal executive offices are located at c/o Nehemya Hesin, 29 Rashbi St. Apt
#19, Modiin Illit, Israel, 71919.  Our telephone number is
011-972-545-681-953.





Our
Common Shares are traded on the over-the-counter market and quoted on the
over-the-counter bulletin board (the “OTCBB”) under the symbol
“BNHI.OB”.





Bankruptcy, Receivership or
Similar Proceeding





We have
never declared bankruptcy, have never been in receivership, and have never been
involved in any legal actions or proceedings.





Business
of Issuer





Our Principal
Product





We are a
development stage company.  The purpose of our Company is to import
and market environmentally friendly and biodegradable plastics (bioplastics for
short), in the form of disposable utensils, plates, and cups to environmentally
conscious consumers in Israel and later in the United States.  We
intend to source these bioplastic products from Far East manufacturers, and
offer these products as an alternative to traditional disposable plastic
utensils. We have begun discussions with several Far East manufacturers
regarding product pricing and quality.





Our Business
Strategy





Almost
all grocery stores and retail outlets carry disposable plastic utensils such as
cups, plates, forks, knives and spoons. In addition, the foodservice industry is
a big end user of plastic utensils. It is our intent to increase customer
awareness of the benefits of using biodegradable plastic utensils. We intend to
accomplish this objective by building on the BNH brand and our slogan "Eat
Green" (“Tochal Yarok”
in Hebrew) through marketing, promoting and providing competitive industry
pricing on quality bioplastic products.





Our Marketing
Strategy





Our
marketing strategy will focus on creating awareness of our brand name for our
bioplastic products while expending minimal expenses to do so.  We
plan to use inexpensive forums to do so, such as internet based advertising,
inexpensive "green" information forums, outside sales, community marketing, and
trade shows.  We intend to use hands-on sampling at outside events
such as local carnivals, camp sites, and parks.





Competitive Business
Conditions and our Competitive Position in the Industry and Methods of
Competition





There is
significant competition in our market.  In Israel, our competition
includes companies such as Ecoplates and Ecojo.  The market
in Israel is less developed than in the United States, where bioplastic products
can be purchased directly from the distributors’ web sites and at other retail
locations.  The market in the United States is the most developed and
many retail chains carry bioplastic utensils.  When we eventually
market our products in the United States, we will be competing with Tocobaga Traders, Green Home, and Green Earth Office Supplies,
among others.  These companies have many more resources than we do and
are able to purchase their products in larger quantities, thereby reducing their
purchasing costs.




1


Dependence on One or a Few
Major Suppliers





We plan
to purchase our bioplastic products from several different suppliers in the Far
East so as not to be dependent on one major supplier.  However, if we
end up entering into supply contracts with only one or two suppliers, then we
may end up being dependent on such supplier(s) for the supply of all or most of
our bioplastic products.





Governmental
Regulations





We may be
subject to a variety of laws and regulations relating to product safety, among
other things.  We believe that we are currently in compliance with
such laws and have no current liabilities thereunder. Our intent is to maintain
strict compliance with all relevant product safety laws, rules and
regulations.





Employees





As of
December 31, 2008, we have no employees.  All functions, including
development, strategy, negotiations and administration, are currently being
provided by our Directors on a voluntary basis.





Risk
Factors Relating to Our Company





We
are a development stage company with no operating history and may never be able
to effectuate our business plan or achieve any revenues or profitability; at
this stage of our business, even with our good faith efforts, potential
investors have a high probability of losing their entire
investment.





We are
subject to all of the risks inherent in the establishment of a new business
enterprise.   Our Company was established on September 4,
2007.  Although we have begun initial investigations into the
bioplastic industry, we may not be able to successfully implement our business
objectives.  There can be no assurance that we will ever achieve any
revenues or profitability. The revenue and income potential of our proposed
business and operations is unproven, and the lack of operating history makes it
difficult to evaluate the future prospects of our business.  We have
not generated any revenues to date.  Accordingly, our prospects must
be considered in light of the risks, expenses and difficulties frequently
encountered in establishing a new business, and our Company is a highly
speculative venture involving a high degree of financial risk.





We
expect losses in the future because we have no revenue to offset
losses.





As we
have no current revenue, we are expecting losses over the next 12 months because
we do not yet have any revenues to offset the expenses associated with the
development and implementation of our business plan. We cannot guarantee that we
will ever be successful in generating revenues in the future. We recognize that
if we are unable to generate revenues, we will not be able to earn profits or
continue operations.  There is no history upon which to base any
assumption as to the likelihood that we will prove successful, and we can
provide investors with no assurance that we will generate any operating revenues
or ever achieve profitable operations.





We
have a going concern opinion from our auditors, indicating the possibility that
we may not be able to continue to operate.





We have
not yet established an ongoing source of revenues.  Furthermore, we
anticipate generating losses for the next 12 months.  These factors
raise substantial doubt that we will be able to continue operations as a going
concern, and our independent auditors included an explanatory paragraph
regarding this uncertainty in their report on our financial statements for the
period September 4, 2007 (inception) to December 31, 2008.  Our
ability to continue as a going concern is dependent upon our generating cash
flow sufficient to fund operations and reducing operating expenses. Our business
strategy may not be successful in addressing these issues.  If we
cannot continue as a going concern, our stockholders may lose their entire
investment in us.


2


We
will rely on third parties to develop, produce, package, sell, and market our
products, which may place us at a competitive disadvantage.





We intend
to retain third party contractors for several purposes. We plan to locate and
enter into agreements with one or more third party manufacturing companies that
currently manufacture biodegradable disposable utensils, plates and
cups.  We also plan to locate and enter into agreements with third
party distributors for the sale of our products, and eventually with third party
logistics providers to provide order fulfillment services.  We also
plan to locate and enter into an agreement with a third party web developer for
the purpose of developing our website for direct sales of our products to
consumers.  As a result, we expect to be dependent on those third
party firms that we engage. There is no assurance that we will be able to enter
into contracts with any such third parties on terms that are favorable to
us.  If any of our third party contractors breaches the contract or
does not have the ability, for financial or other reasons, to perform its
obligations, we may not be able to implement our business plan. Our reliance on
third parties may place us at a competitive disadvantage.





If
we are unable to obtain additional funding, our business operations will be
harmed.





We will
require additional funds to implement our business plan. We anticipate that we
will require a minimum of $100,000 to fund our planned activities for the next
twelve months. We hope to raise this capital through the sale of our securities
in a private placement.  If we are unable to raise the required
capital, our ability to grow will be restricted and our ability to continue to
conduct business operations will be harmed.  If we are unable to
obtain necessary financing, we will likely be required to curtail our
development plans, which could cause the Company to become dormant. Furthermore,
any additional equity financing may involve substantial dilution to our then
existing shareholders.





We
may not be able to compete with current and potential competitors, some of whom
have greater resources and experience than we do.





We may
not have the resources to compete with our existing competitors or with any new
competitors.





We intend
to compete with many providers of bioplastic and biodegradable disposable
utensils, as wells as with providers of traditional plastic utensils, all of
which have significantly greater personnel, financial, and managerial resources,
and significantly greater reputations, than we have.  This competition
from other companies with greater resources and reputations may result in our
failure to maintain or expand our business.





Moreover,
as the demand for bioplastic and biodegradable disposable utensils increases,
new companies may enter the market and the influx of added competition will pose
an increased risk to our Company. New companies providing traditional plastic
utensils may also enter the market, increasing the risk to our Company.
Increased competition may lead to price wars, which would harm us since we would
be unable to compete with companies with greater resources.  In
addition, increased competition and increased demand may create a stress on the
bioplastic manufacturers’ output capabilities, which may lead to increased
prices, which would also harm our ability to compete in the disposable utensils
market.





Since our officers and Directors may
work or consult for other companies, their other activities could slow down our
operations.





Our
officers and Directors are not required to work exclusively for us and do not
devote all of their time to our operations. Presently, our officers and
Directors allocate only a portion of their time to the operation our business.
Since our officers and Directors are currently employed full-time elsewhere,
they are able to commit to us only up to 3-6 hours a week. Therefore, it is
possible that their pursuit of other activities may slow our operations and
reduce our financial results because of the slow-down in
operations.





Our officers and Directors are
located in Israel.





Since all
of our officers and Directors are located in Israel, any attempts to enforce
liabilities upon such individuals under the U.S. securities and bankruptcy laws
may be difficult.




3




We
need to retain key personnel to support our business and ongoing
operations.





The
development of our business and the marketing and sale of our products will
continue to place a significant strain on our limited personnel, management, and
other resources.  Our future success depends upon the continued
services of our executive officers and the engagement of key employees and
contractors who have critical industry experience and relationships that we rely
on to implement our business plan.  The loss of the services of any of
our officers or the lack of availability of other skilled personnel would
negatively impact our ability to develop our Company and to market and sell our
intended products, which could adversely affect our financial results and impair
our growth.





Because
both Mr Hesin and Mrs. Mimouni have no experience in running a company that
imports bioplastic products, they may not be able to successfully operate such a
business.




We are a
start-up company and we intend to import and sell our bioplastic products. Mr.
Hesin and Mrs. Mimouni, our current officers, have effective control over all
decisions regarding both policy and operations of our Company with no oversight
from other management. However, they have no experience in running a company
that imports bioplastic products. Our success is contingent upon these
individuals' ability to make appropriate business decisions in these areas. It
is possible that their lack of relevant operational experience could prevent us
from becoming a profitable business, resulting in investors losing part or all
of their entire investment in us.





The
bioplastic industry is subject to the risk of highly volatile price
swings.





Fossil
fuels and corn are needed for the production of bioplastic
products.  Even though bioplastic product production is considered
more efficient than traditional plastic production in terms of the use of fossil
fuels and corn in the manufacturing process, the bioplastic industry remains
dependent on the availability of fossil fuels and corn.  Due to the
rising costs of corn in the commodities market and the volatility of petroleum
prices  and the unstable global oil market, any company relying on
fossil fuels and corn as main components of their operating expenses is subject
to the risk of highly volatile price swings.  Because traditional
plastic manufacturing companies use state of the art technology to produce
products and purchase petroleum in mass quantities, they are able to keep their
costs stable.  Any rise in the price of corn and/or petroleum will
cause us to incur additional expenses.  Thus, we could see retail
price jumps in the bioplastic utensils combined with a significantly lower
increase in traditional plastic utensil prices.





We
could be subject to significant and costly product liability
claims.




We could
be subject to significant product liability claims if the disposable products we
sell cause injury or illness. We do not have liability insurance with respect to
product liability claims. The costs associated with product liability claims and
product recalls could significantly reduce our operating results.





Our
executive officers own a majority of the outstanding shares of our common stock,
and other stockholders may not be able to influence control of the Company or
decision making by management of the Company.





Our
executive officers presently own, in the aggregate, 64.29% of our outstanding
common stock.  As a result, our executive officers have substantial
control over all matters submitted to our stockholders for approval including
the following matters: election of our Board of Directors; removal of any of our
Directors; amendment of our Articles of Incorporation or bylaws; and adoption of
measures that could delay or prevent a change in control or impede a merger,
takeover or other business combination involving us.  Other
stockholders may consider the corporate decisions made by our executive officers
to be inconsistent with the interests of these stockholders.  In
addition, other stockholders may not be able to change the Directors and
officers, and are accordingly subject to the risk that management cannot or will
not manage the affairs of the Company in accordance with such stockholders’
wishes.





Because
bioplastics are made from feedstock, particularly corn, and corn is used for
many different purposes, we face the risk of interruption of supply or increase
in costs, which would harm our business and results of operation.





It is
estimated that 50% of bioplastic products produced are made from starch,
particularly corn starch.  Corn is used for many different purposes,
as an additive for many foods, as feed for farm animals, in the production of
ethanol, etc.  As a result, we face the risk of interruption of supply
or increase in cost. The competition for bioplastic utensils could be intense,
and we may not be able to compete effectively against other purchasers who have
higher volume requirements or more established relationships. Even if suppliers
have adequate supplies of starch to produce biodegradable products, they may be
unreliable in meeting delivery schedules, experience their own financial
difficulties, provide products of inadequate quality, or provide them at prices
which reduce our profit. Any problems that our manufacturers face with regard to
the supply of starch can be expected to affect our ability to source bioplastic
products, which could have a material adverse effect on our financial condition,
business, results of operations, and continued growth prospects.




4


Establishing
a new brand requires effective marketing and product placement which may take a
long period of time.




Our
principal business strategy is to develop our brand name as a respected brand
associated with the highest quality bioplastic products.   The
marketing of our intended product is highly dependent on creating favorable
consumer perception.    We have minimal advertising
experience.   Competitors have significantly greater advertising
resources and experience and enjoy well-established brand
names.  There can be no assurance that our initial advertising and
promotional activities will be successful in creating the desired consumer
perception.





Risks Relating to Operating in
Israel





We
conduct our operations in Israel and therefore our results may be adversely
affected by political, economic and military instability in Israel.





Our
current operations and our officers and Directors are located in Israel.
Accordingly, political, economic and military conditions in Israel may directly
affect our business. Since the establishment of the State of Israel in 1948, a
number of armed conflicts have taken place between Israel and its Arab
neighbors. Any hostilities involving Israel or the interruption or curtailment
of trade within Israel or between Israel and its trading partners could
adversely affect our operations and could make it more difficult for us to raise
capital.





Since
September 2000, terrorist violence in Israel has increased significantly and
negotiations between Israel and Palestinian representatives have not achieved a
peaceful resolution of the conflict. The establishment in 2006 of a government
in the Palestinian Authority by representatives of the Hamas militant group has
created additional unrest and uncertainty in the region.





Further,
Israel is currently engaged in an armed conflict with Hamas, which involves
thousands of missile strikes and disrupted most day-to-day civilian activity in
southern Israel. These missile attacks by Hamas have not targeted Modiin Illit,
the location of our principal executive offices; however, any armed conflict,
terrorist activity or political instability in the region would likely
negatively affect business conditions and could significantly harm our results
of operations.





ITEM
      2.
            PROPERTIES





Our
Principal Executive Offices





Our
principal executive offices are located at c/o Nehemya Hesin, 29 Rashbi St. Apt
#19, Modiin Illit, Israel, 71919.  Our telephone number is
011-972-545-681-953. We believe that the condition of our lease property is
satisfactory, suitable and adequate for our current needs.





ITEM
      3.
            LEGAL
      PROCEEDINGS





We know
of no material, active or pending legal proceedings against our Company, nor of
any proceedings that a governmental authority is contemplating against
us.





We know
of no material proceedings to which any of our directors, officers, affiliates,
owner of record or beneficially of more than 5% of our voting securities or
security holder is an adverse party or has a material interest adverse to our
interest.





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





There
were no matters submitted to a vote of security holders through the solicitation
of proxies or otherwise during the fourth quarter of the fiscal year ended
December 31, 2008.


5


PART
II




ITEM
      5.
            MARKET
      FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER
      PURCHASES OF EQUITY SECURITIES





Market
Information





On July
9, 2008, our Common Shares began trading on the over-the-counter market and are
currently quoted on the OTCBB under the symbol “BNHI.OB”. Prior to that date,
there was no established trading market for our Common Shares.  There
has been no active trading in our securities and there have been
no high or low bid prices quoted.





Holders
of our Common Shares





As of
February 10, 2009, there were 45 registered stockholders holding 7,000,000
Common Shares issued and outstanding.





Dividends





Since our
inception, we have not declared nor paid any cash dividends on our capital stock
and we do not anticipate paying any cash dividends in the foreseeable future.
Our current policy is to retain any earnings in order to finance our operations.
Our Board of Directors will determine future declarations and payments of
dividends, if any, in light of the then-current conditions it deems relevant and
in accordance with applicable corporate law.





There are
no restrictions in our Articles of Incorporation or Bylaws that prevent us from
declaring dividends. The Nevada Revised Statutes, however, do prohibit us from
declaring dividends where, after giving effect to the distribution of the
dividend:





·
            we
      would not be able to pay our debts as they become due in the usual course
      of business; or





·
            our
      total assets would be less than the sum of our total liabilities plus the
      amount that would be needed to satisfy the rights of stockholders who have
      preferential rights superior to those receiving the
      distribution.





Securities
Authorized for Issuance Under Equity Compensation Plans





As of the
date hereof, we have not adopted an equity compensation plan and have not
granted any stock options.





Recent
Sales of Unregistered Securities





During
the fiscal year ended December 31, 2008, except as included in our Quarterly
Reports on Form 10-Q or in our Current Reports on Form  8-K, we have
not sold any equity securities not registered under the Securities
Act.





Purchases
of Equity Securities by the Issuer and Affiliated Purchases





During
each month within the fourth quarter of the fiscal year ended December 31, 2008,
neither we nor any “affiliated purchaser”, as that term is defined in Rule
10b-18(a)(3) under the Exchange Act, repurchased any of our Common Shares or
other securities.





ITEM
      6.
            SELECTED
      FINANCIAL DATA





Not
applicable.


6


ITEM
      7.
            MANAGEMENT’S
      DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
      OPERATIONS





The
following Management’s Discussion and Analysis of Financial Condition and
Results of Operations (“MD&A”) is intended to help you understand our
historical results of operations during the periods presented and our financial
condition. This MD&A should be read in conjunction with our financial
statements and the accompanying notes, and contains forward-looking
statements that involve risks and uncertainties. See section entitled “Forward
Looking Statements” above.




EXECUTIVE
OVERVIEW




We were
incorporated in the State of Nevada on September 4, 2007.  Since our
incorporation, we had been in the process of establishing ourselves as a company
in the business of distributing and selling environmentally friendly and
biodegradable plastics (bioplastics for short), in the form of disposable
utensils, plates, and cups to environmentally conscious consumers in Israel and
later in the United States.





We have
not generated any revenue since our inception. We are a development stage
company with limited operations. Our auditors have issued a going concern
opinion. This means that our auditors believe there is substantial doubt that we
can continue as an ongoing business for the next twelve
months.





PLAN OF
OPERATION





Over the
next twelve months we plan to:





·
            locate
      potential wholesale customers for our
products.





·
            purchase
      bioplastic utensils from Far-East manufacturers and import these
      bioplastic utensils initially to Israel for distribution to both retail
      and foodservice industry customers.





·
            locate
      a distributor for our products.





·
            solicit
      editorial coverage for environmentally friendly utensils such as the ones
      we plan to import.





RESULTS
OF OPERATIONS




For
the years ended December 31, 2008 and December 31, 2007




We have
not generated any revenues since inception through the year ended December 31,
2008.  Our operating activities during these periods consisted
primarily of developing our business plan and developing our Company as a
company in the business of distributing and selling environmentally friendly and
biodegradable plastics (bioplastics for short), in the form of disposable
utensils, plates, and cups to environmentally conscious consumers in Israel and
later in the United States.




General
and administrative expenses were $28,511 for the year ended December 31, 2008,
compared to $25,798 for the year ended December 31, 2007. The increase in
general and administrative expenses was due to an increase in our activity
level. General and administrative expenses primarily consist of professional
fees, and filing expenses.




Our net
loss for the year ended December 31, 2008, was $28,511 or $0.00 per share,
compared to $25,798 or $(0.01) for the year ended December 31, 2007. The
weighted average number of shares outstanding was 6,983,616 at December 31,
2008, compared to 2,607,143 at December 31, 2007.


7


LIQUIDITY
AND CAPITAL RESOURCES




As
of December 31, 2008




As of
December 31, 2008, our current assets were $6,641 and our current liabilities
were $5,950, resulting in working capital of $691.




As of
December 31, 2008, our total liabilities were $5,950, compared to total
liabilities of $21,238 as of December 31, 2007, all consisting of current
liabilities.




Stockholders’
equity decreased from $5,202 at December 31, 2007, to equity of $691 at December
31, 2008.  This was mainly a result of the net loss for the year ended
December 31, 2008.




For the
year ended December 31, 2008, net cash used in operating activities was $44,086,
compared to net cash used in operating activities of $60 for the year ended
December 31, 2007. Net cash used in operating activities for the year ended
December 31, 2008 was comprised of a net loss of $28,511 and payment of prior
accrued liabilities.




Net cash
flows from financing activities for the year ended December 31, 2008 was
$24,000, compared to net cash flows from financing activities of $26,500 for the
year ended December 31, 2007.




Going
Concern




Our
registered independent auditors included an explanatory paragraph in their
report on the accompanying financial statements regarding concerns about our
ability to continue as a going concern. Our financial statements contain
additional note disclosures describing the circumstances that lead to this
disclosure by our registered independent auditors. The financial statements do
not include any adjustments that might result from the outcome of that
uncertainty.




We
currently estimate that we will require an additional $100,000 to fund our
operations for the subsequent 12 month period.  There are no
assurances that we will be able to obtain funds required for our continued
operation.  There can be no assurance that additional financing will be
available to us when needed or, if available, that it can be obtained on
commercially reasonable terms.  If we are not able to obtain the
additional financing on a timely basis, we will not be able to meet our other
obligations as they become due and we will be forced to scale down or perhaps
even cease the operation of our business. The issuance of additional equity
securities by us could result in a significant dilution in the equity interests
of our current stockholders.  Obtaining commercial loans, assuming
those loans would be available, will increase our liabilities and future cash
commitments.




Off-Balance
Sheet Arrangements




There are
no off-balance sheet arrangements that have or are reasonably likely to have a
current or future effect on our financial condition, changes in financial
condition, revenues or expenses, results of operations, liquidity, capital
expenditures or capital resources that is material to investors.




CRITICAL
ACCOUNTING POLICIES




Our
financial statements have been prepared in accordance with accounting principles
generally accepted in the United States. The preparation of these financial
statements requires us to make certain estimates and assumptions that affect the
reported amounts of assets, liabilities, revenues and expenses, and the related
disclosures of contingent assets and liabilities as of the date of the financial
statements and during the applicable periods. We base these estimates on
historical experience and on other factors that we believe are reasonable under
the circumstances. Actual results may differ materially from these estimates
under different assumptions or conditions and could have a material impact on
our financial statements.





8




RECENT
ACCOUNTING PRONOUNCEMENTS




Refer to
Note 1 to the Financial Statements entitled “Recent Accounting
Pronouncements” included in this annual report for a discussion of recent
accounting pronouncements and their impact on our Financial
Statements.





In June
2008, the Financial Accounting Standards Board (“FASB”) issued FASB Staff
Position No. EITF No. 03-6-1, “Determining Whether Instruments Granted
in Share-Based Payment Transactions Are Participating Securities” (“FSP EITF
No. 03-6-1”). According to FSP EITF No. 03-6-1, unvested share-based
payment awards that contain nonforfeitable rights to dividends or dividend
equivalents are considered participating securities under SFAS No. 128. As
such, they should be included in the computation of basic earnings per share
(“EPS”) using the two-class method. FSP EITF No. 03-6-1 is effective for
financial statements issued for fiscal years beginning after December 15,
2008, as well as interim periods within those years. Once effective, all
prior-period EPS data presented must be adjusted retrospectively. The Company
does not expect FSP EITF No. 03-6-1 to have a material impact on the
Company’s financial position or results of operations.





In March
2008, the FASB issued Statement No. 161, “Disclosures about Derivative
Instruments and Hedging Activities”, an amendment of FASB Statement No. 133
(“SFAS No. 161”). SFAS No. 161 applies to all derivative
instruments and nonderivative instruments that are designated and qualify as
hedging instruments and related hedged items accounted for under
SFAS No. 133. SFAS No. 161 requires entities to provide greater
transparency through additional disclosures about (a) how and why an entity
uses derivative instruments, (b) how derivative instruments and related
hedged items are accounted for under SFAS No. 133 and its related
interpretations, and (c) how derivative instruments and related hedged
items affect an entity’s financial position, results of operations, and cash
flows. SFAS No. 161 is effective for financial statements issued for
fiscal years and interim periods beginning after November 15, 2008. The
Company does not expect SFAS No. 161 to have a material impact on the
Company’s financial position or results of operations.





In
December 2007, the FASB issued Statement No. 141 (revised), “Business
Combinations” (“SFAS No. 141(R)”). SFAS No. 141(R)
significantly changes the accounting for business combinations and establishes
principles and requirements for how an acquirer recognizes and measures in its
financial statements the identifiable assets acquired, the liabilities assumed
and any noncontrolling interest in the acquiree and recognizes and measures the
goodwill acquired in the business combination or a gain from a bargain purchase.
SFAS No. 141(R) applies prospectively to business combinations for
which the acquisition date is on or after the beginning of the first annual
reporting period beginning on or after December 15, 2008.





In
December 2007, the FASB issued Statement No. 160, “Noncontrolling Interests
in Consolidated Financial Statements” - an amendment of ARB No. 51
(“SFAS No. 160”). SFAS No. 160 changes the accounting for
noncontrolling (minority) interests in consolidated financial statements
including the requirements to classify noncontrolling interests as a component
of consolidated shareholders’ equity, the elimination of “minority interest”
accounting in results of operations and changes in the accounting for both
increases and decreases in a parent’s controlling ownership interest.
SFAS No. 160 is effective for fiscal years beginning after
December 15, 2008, and early adoption is prohibited. The Company does not
expect SFAS No. 160 to have a material impact on the Company’s
financial position or results of operations.





In
February 2007, the FASB issued Statement No. 159 “The Fair Value Option for
Financial Assets and Financial Liabilities” including an amendment of FASB
Statement No. 115 (“SFAS No. 159”), which allows an entity the
irrevocable option to elect fair value for the initial and subsequent
measurement for certain financial assets and liabilities under an
instrument-by-instrument election. If the fair value option is elected for
an instrument, subsequent changes in fair value for that instrument will be
recognized in earnings. SFAS No. 159 also establishes additional
disclosure requirements and is effective for fiscal years beginning after
November 15, 2007, with early adoption permitted provided that the entity
also adopts Statement No. 157, “Fair Value Measurements”
(“SFAS No. 157”). SFAS No. 159 is not expected to have a
material impact on its results of operations or financial position.





In
September 2006, the FASB issued SFAS No. 157 which defines fair value,
establishes a framework for measuring fair value in generally accepted
accounting principles, and expands disclosures about fair value measurements.
SFAS No. 157 applies under other accounting pronouncements that
require or permit fair value measurements. SFAS No. 157 is effective
for fiscal years beginning after November 15, 2007, and interim periods
within those fiscal years. In February 2008, the FASB issued FASB Staff Position
No. SFAS No. 157-2, Effective Date of FASB Statement No. 157,
which provides a one-year deferral of the effective date of
SFAS No. 157 for non-financial assets and non-financial liabilities,
except those that are recognized or disclosed in the financial statements at
fair value on a recurring basis (at least annually). The adoption of
SFAS No. 157 for financial assets and financial liabilities is not
expected to have a material impact on the Company’s results of operations or
financial position.





9




ITEM
      7A.
            QUANTITATIVE
      AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK




Not
applicable.





ITEM
      8.
            FINANCIAL
      STATEMENTS AND SUPPLEMENTARY DATA





The
financial statements required by this item are included in this report in Part
IV, Item 15, beginning on page F-1.





ITEM
      9.
            CHANGES
      IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
      DISCLOSURE




Not
Applicable.





ITEM
      9A.
            CONTROLS
      AND PROCEDURES





(a)
Disclosure Controls and Procedures




Disclosure
controls and procedures are the controls and other procedures that are designed
to provide reasonable assurance that information required to be disclosed by the
issuer in the reports that it files or submits under the Securities Exchange Act
of 1934, as amended (the “Exchange Act”) is recorded, processed, summarized and
reported within the time periods specified in the Securities and Exchange
Commission’s rules and forms. Disclosure controls and procedures include,
without limitation, controls and procedures designed to ensure that information
required to be disclosed by an issuer in the reports that it files or submits
under the Exchange Act is accumulated and communicated to the issuer’s
management, including the principal executive and principal financial officer,
or persons performing similar functions, as appropriate, to allow timely
decisions regarding required disclosure. Any controls and procedures, no matter
how well designed and operated, can provide only reasonable assurance of
achieving the desired control objectives.




We have
carried out an evaluation, under the supervision and with the participation of
our Chief Executive Officer and Principal Financial and Accounting Officer, of
the effectiveness of our disclosure controls and procedures, as defined in Rules
13a-15(e) and 15d-15(e) of the Exchange Act as of the end of the fiscal year
covered by this annual report.





Based on
that evaluation, our Chief Executive Officer and our Principal Financial and
Accounting Officer have concluded that the Company’s disclosure controls and
procedures were effective as of the end of the fiscal year covered by this
Annual Report on Form 10-K.





(b)
Management’s Annual Report on Internal Control over Financial
Reporting




Management
is responsible for establishing and maintaining adequate internal control over
financial reporting, as defined in Securities Exchange Act Rule 13a-15(f).
Internal control over financial reporting is designed to provide reasonable
assurance regarding the reliability of financial reporting and preparation of
financial statements for external purposes in accordance with U.S.
GAAP.





Under the
supervision and with the participation of our Chief Executive Officer and our
Principal Financial and Accounting Officer, we conducted an assessment of the
design and effectiveness of our internal control over financial reporting as of
the fiscal year covered by this report. Based on this assessment, management
concluded that, as of December 31, 2008, the Company’s internal control over
financial reporting was effective.




10


This
annual report does not include an attestation report of our Company’s registered
public accounting firm regarding internal control over financial reporting.
Management’s report was not subject to attestation by the Company’s registered
public accounting firm pursuant to temporary rules of the SEC that permit the
Company to provide only management’s report in this annual report.





(c)
Change in Internal Control over Financial Reporting





There
were no significant changes to our internal control over financial reporting (as
defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during our
fourth fiscal quarter, that could materially affect, or are reasonably likely to
materially affect, our internal control over financial reporting.




ITEM
      9B.
            OTHER
      INFORMATION





None.




PART
III





ITEM
      10.
            DIRECTORS,
      EXECUTIVE OFFICERS AND CORPORATE
GOVERNANCE





Directors,
Executive Officers, Promoters and Control Persons





The
following individuals serve as the Directors and executive officers of our
Company. All Directors of our Company hold office until the next annual meeting
of our shareholders or until their successors have been elected and qualified.
The executive officers of our Company are appointed by our Board of Directors
and hold office until their death, resignation or removal from
office:





Name
                      
                      Age
                      
                      Position Held with our
                        CompanyNehemya
      Hesin
                      
                      32
                      
                      President,
      Treasurer and DirectorDanielle
      Mimouni
                      
                      55
                      
                      Secretary
      and Director





The
following is a brief summary of the education and business experience during at
least the past five years of each Director, executive officer and key employee
of our Company, indicating the person's principal occupation during that period,
and the name and principal business of the organization in which such occupation
and employment were carried out.





Mr.Nehemya Hesinjoined our Company on
November 12, 2007. Mr. Hesin is the Company’s President, Treasurer, and
Director. Since 2001 Mr. Hesin has been Chairman of the Breslov Center in Modiin
Illit, Israel. Mr. Hesin is responsible for all aspects of the Center, including
financial management, operations, and managing the day to day
operations   In addition, Mr. Hesin’s responsibilities include
organizing charitable events such as group dinners to the underprivileged and
organizing group travels.  From 1998-2001 Mr. Hesin was a sales
manager at Tzivha International in Modiin Illit, Israel where he was responsible
for selling units in apartment complexes owned by Tzivha
International.  Mr. Hesin graduated in 1995 from the Breslov High
School in Bnei Brak, Israel.





Mrs. DanielleMimouniis the Company’s
Secretary and Director. She is a practicing psychologist and holds a Ph.D in
Psychology from University du Lyon, Lyon France. Mrs. Mimouni is self employed.
In the years of 2004-2006 she worked for the Israel Absorption
Office  speaking at events and assisting new immigrants upon their
arrival in Israel. During this period and going back to 1999 Mrs. Mimouni
conducted private counseling sessions with individuals and also provided marital
counseling services to couples.





There are
no familial relationships among any of our officers or
Directors.  None of our Directors or officers is a director in any
other reporting company.  None of our Directors or officers has been
affiliated with any company that has filed for bankruptcy within the last five
years.  The Company is not aware of any proceedings to which any of
the Company’s officers or Directors, or any associate of any of the Company's
officers or Directors, is a party adverse to the Company or any of the Company’s
subsidiaries, or has a material interest adverse to the Company or any of
the Company's subsidiaries.


11


Board
Composition





Our
bylaws provide that the Board of Directors shall consist of one or more
members.  Each Director of the Company serves for a term of one year
or until the successor is elected at the Company's annual shareholders' meeting
and is qualified, subject to removal by the Company's
shareholders.  Each officer serves, at the pleasure of the Board of
Directors, for a term of one year and until the successor is elected at the
annual meeting of the Board of Directors and is qualified.





No
Committees of the Board of Directors; No Financial Expert




We do not
presently have a separately constituted audit committee, compensation committee,
nominating committee, executive committee or any other committee of our Board of
Directors. Nor do we have an audit committee “financial expert”.  As
such, our entire Board of Directors acts as our audit committee.




Auditors;
Code of Ethics





Our
principal registered independent auditor is Alan Weinberg CPA. We do not
currently have a Code of Ethics applicable to our principal executive,
financial, and accounting officers.





Potential
Conflicts of Interest




Since we
do not have an audit or compensation committee comprised of independent
directors, the functions that would have been performed by such committees are
performed by our Directors.  Thus, there is a potential conflict of
interest in that our Directors and officers have the authority to determine
issues concerning management compensation and audit issues that may affect
management decisions.  We are not aware of any other conflicts of
interest with any of our officers or Directors.




Director
Independence





We are
not subject to listing requirements of any national securities exchange or
national securities association and, as a result, we are not at this time
required to have our Board of Directors comprised of a majority of “independent
directors.” We do not believe that any of our Directors currently meet the
definition of “independent” as promulgated by the rules and regulations of the
American Stock Exchange.





Involvement
in Legal Proceedings





No
Director, nominee for Director, or officer of the Company has appeared as a
party during the past five years in any legal proceedings that may bear on his
ability or integrity to serve as a Director or officer of the
Company.





ITEM
      11.
            EXECUTIVE
      COMPENSATION





The
particulars of compensation paid to the following persons during the fiscal
period ended December 31, 2008 are set out in the summary compensation table
below:





·
            our
      Chief Executive Officer (Principal Executive
  Officer);


·
            our
      Chief Financial Officer (Principal Financial
  Officer);


·
            each
      of our three most highly compensated executive officers, other than the
      Principal Executive Officer and the Principal Financial Officer, who were
      serving as executive officers at the end of the fiscal year ended December
      31, 2008; and


·
            up
      to two additional individuals for whom disclosure would have been provided
      under the item above but for the fact that the individual was not serving
      as our executive officer at the end of the fiscal year ended December 31,
      2008;





(collectively, the “Named Executive
Officers”):




12




SUMMARY
      COMPENSATION TABLEName
                                  
                                  Year
                                  
                                  
                                  Salary
                                    ($)
                                  
                                  
                                  Bonus
                                    ($)
                                  
                                  
                                  Stock
                                    Awards
                                    ($)
                                  
                                  
                                  Option
                                    Awards
                                    ($)
                                  
                                  
                                  Non-Equity
                                    Incentive Plan
                                    Compensation
                                    ($)
                                  
                                  
                                  Nonqualified
                                    Deferred
                                    Compensation
                                    Earnings
                                    ($)
                                  
                                  
                                  All Other
                                    Compensation
                                    ($)
                                  
                                  
                                  Total
                                    ($)Nehemya
      Hesin
                                  
                                  2007
                                  
                                  
                                  
                                  0
                                  
                                  
                                  
                                  0
                                  
                                  
                                  
                                  3,000
                                  
                                  
                                  
                                  0
                                  
                                  
                                  
                                  0
                                  
                                  
                                  
                                  0
                                  
                                  
                                  
                                  0
                                  
                                  
                                  
                                  3,0002008
                                  
                                  
                                  
                                  0
                                  
                                  
                                  
                                  0
                                  
                                  
                                  
                                  0
                                  
                                  
                                  
                                  0
                                  
                                  
                                  
                                  0
                                  
                                  
                                  
                                  0
                                  
                                  
                                  
                                  0
                                  
                                  
                                  
                                  0Danielle Mimouni
                                  
                                  2007
                                  
                                  
                                  
                                  0
                                  
                                  
                                  
                                  0
                                  
                                  
                                  
                                  1,500
                                  
                                  
                                  
                                  0
                                  
                                  
                                  
                                  0
                                  
                                  
                                  
                                  0
                                  
                                  
                                  
                                  0
                                  
                                  
                                  
                                  1,5002008
                                  
                                  
                                  
                                  0
                                  
                                  
                                  
                                  0
                                  
                                  
                                  
                                  0
                                  
                                  
                                  
                                  0
                                  
                                  
                                  
                                  0
                                  
                                  
                                  
                                  0
                                  
                                  
                                  
                                  0
                                  
                                  
                                  
                                  0





Summary
Compensation





On
October 18, 2007, we issued 1,500,000 shares of our common stock to Mrs.
Danielle Mimouni, a Director and the current Secretary of the Company. The
shares were issued in exchange for services rendered in the amount of
$1,500.





On
November 12, 2007, we issued 3,000,000 shares of our common stock to Mr. Nehemya
Hesin, the President, Treasurer and a Director of the Company. The shares were
issued in exchange for services rendered in the amount of $3,000.





On
October 25, 2007, we issued 250,000 shares of our common stock to Mrs. Redkina,
a former Treasurer of the Company. The shares were issued in exchange for
services rendered in the amount of $250.





We have
no employment agreements with any of our Directors or executive officers. We
have no pension, health, annuity, bonus, insurance, stock options, profit
sharing, or similar benefit plans.





Since our
incorporation on September 4, 2007, no stock options or stock appreciation
rights have been granted to any of our Directors or executive officers, none of
our Directors or executive officers exercised any stock options or stock
appreciation rights, and none of them hold unexercised stock options. We have no
long-term incentive plans.





Outstanding
Equity Awards




Our
Directors and officers do not have unexercised options, stock that has not
vested, or equity incentive plan awards.





Compensation
of Directors




Our
Directors do not receive compensation for their services as
Directors.




Employment
Contracts, Termination of Employment, Change-in-Control
Arrangements




There are
no employment or other contracts or arrangements with officers or Directors.
There are no compensation plans or arrangements, including payments to be made
by us, with respect to our officers, Directors or consultants that would result
from the resignation, retirement or any other termination of such Directors,
officers or consultants from us. There are no arrangements for Directors,
officers, employees or consultants that would result from a
change-in-control.


13


ITEM
      12.
              SECURITY
      OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
      STOCKHOLDER MATTERS





Beneficial
Ownership of Holdings





The
following table sets forth, as of December 31, 2008, certain information with
respect to the beneficial ownership of our common stock by each stockholder
known by us to be the beneficial owner of more than 5% of our common stock, as
well as by each of our current directors and executive officers as a group. Each
person has sole voting and investment power with respect to the shares of common
stock, except as otherwise indicated. Beneficial ownership consists of a direct
interest in the shares of common stock, except as otherwise
indicated.





Name and Address
                                              of Beneficial Owner
                                            
                                            Title of Class
                                            
                                            
                                            Amount and Nature of
                                              Beneficial Ownership(1)
                                            
                                            
                                            Percentage of Class(2)Nehemya
      Hesin
                                            
                                            Common
                                            
                                            
                                            
                                            3,000,000
                                            
                                            
                                            
                                            42.86
                                            %Danielle
      Mimouni
                                            
                                            Common
                                            
                                            
                                            
                                            1,500,000
                                            
                                            
                                            
                                            21.43
                                            %Total
                                            
                                            Common
                                            
                                            
                                            
                                            4,500,000
                                            
                                            
                                            
                                            64.29
                                            %





Notes:





(1)
            Except
      as otherwise indicated, we believe that the beneficial owners of the
      common stock listed above, based on information furnished by such owners,
      have sole investment and voting power with respect to such shares, subject
      to community property laws where applicable. Beneficial ownership is
      determined in accordance with the rules of the Securities and Exchange
      Commission and generally includes voting or investment power with respect
      to securities. Shares of common stock subject to options or warrants
      currently exercisable, or exercisable within 60 days, are deemed
      outstanding for purposes of computing the percentage ownership of the
      person holding such option or warrants, but are not deemed outstanding for
      purposes of computing the percentage ownership of any other
      person.





(2)
            Based
      on 7,000,000 shares of common stock issued and outstanding as of December
      31, 2008.





Changes
in Control





We are
unaware of any contract or other arrangement the operation of which may at a
subsequent date result in a change of control of our Company.





Equity
Compensation Plan Information





Plan category
                                        
                                        Number of securities
                                          to be issued upon
                                          exercise of outstanding
                                          options, warrants and
                                          rights
                                          
                                          (a)
                                        
                                        
                                        Weighted-average
                                          exercise price of
                                          outstanding options,
                                          warrants and rights
                                          
                                          (b)
                                        
                                        
                                        Number of securities
                                          remaining available for
                                          future issuance under equity
                                          compensation plans
                                          (excluding securities reflected
                                          in column (a))
                                          
                                          (c)Equity
      compensation plans approved by security holders
                                        
                                        
                                        0
                                        
                                        
                                        
                                        0
                                        
                                        
                                        
                                        0Equity
      compensation plans not approved by security holders
                                        
                                        
                                        0
                                        
                                        
                                        
                                        0
                                        
                                        
                                        
                                        0Total
                                        
                                        
                                        0
                                        
                                        
                                        
                                        0
                                        
                                        
                                        
                                        0


14




ITEM
      13.
              CERTAIN
      RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
      INDEPENDENCE.





Since the
beginning of the fiscal year preceding the last fiscal year and except as
disclosed below, none of the following persons has had any direct or indirect
material interest in any transaction to which our Company was or is a party, or
in any proposed transaction to which our Company proposes to be a
party:





·
            any
      director or officer of our Company;





·
            any
      proposed director of officer of our
Company;





·
            any
      person who beneficially owns, directly or indirectly, shares carrying more
      than 5% of the voting rights attached to our common stock;
    or





·
            any
      member of the immediate family of any of the foregoing persons (including
      a spouse, parents, children, siblings, and
  in-laws).





On
September 4, 2007, we issued 250,000 shares of our common stock to Goldy Klein
our previous President, Treasurer, Secretary and a Director of the
Company.  The purchase price paid for such shares was equal to their
par value, $0.001 per share, and amounted in the aggregate to
$250.  The shares were issued under Section 4(2) of the Securities Act
of 1933, as amended.  Mrs. Goldy Klein was our founding officer and
Director and had access to all of the information which would be required to be
included in a registration statement, and the transaction did not involve a
public offering.





On
October 18, 2007, we issued 1,500,000 shares of our common stock to Mrs.
Danielle Mimouni, a Director and the current Secretary of the Company. The
shares were issued in exchange for services rendered in the amount of $1,500.
The shares were issued under Section 4(2) of the Securities Act of 1933, as
amended. Mrs. Danielle Mimouni is a Director and officer of the Company and had
access to all of the information which would be required to be included in a
registration statement, and the transaction did not involve a public
offering.





On
October 25, 2007, we issued 250,000 shares of our common stock to Mrs. Redkina,
a former Treasurer of the Company. The shares were issued in exchange for
services rendered in the amount of $250. The shares were issued under Section
4(2) of the Securities Act of 1933, as amended. Ms. Redkina was an officer of
the Company and had access to all of the information which would be required to
be included in a registration statement, and the transaction did not involve a
public offering.





On
November 12, 2007, we issued 3,000,000 shares of our common stock to Mr. Nehemya
Hesin, the President, Treasurer and a Director of the Company. The shares were
issued in exchange for services rendered in the amount of $3,000. The shares
were issued under Section 4(2) of the Securities Act of 1933, as amended. Mr.
Hesin is a Director and officer of the Company and had access to all of the
information which would be required to be included in a registration statement,
and the transaction did not involve a public offering.





On
December 12, 2007, we borrowed $250 from Mrs. Goldy Klein, who is a stockholder
of the Company and a former officer and Director of the
Company.


15


ITEM
      14.
            PRINCIPAL
      ACCOUNTING FEES AND SERVICES





Audit
Fees




The
aggregate fees billed for each of the last two fiscal years for professional
services rendered by the principal account for the audit of our financial
statements and review of financial statements included in our quarterly Reports
on Form 10-Q and services that are normally provided by the accountant in
connection with statutory and regulatory filings or engagements for these fiscal
periods were as follows:





December 31, 2008
                        
                        
                        December 31, 2007Audit
      Fees
                        
                        
                        12,500
                        
                        
                        
                        0Audit
      Related Fees
                        
                        
                        0
                        
                        
                        
                        0Tax
      Fees
                        
                        
                        250
                        
                        
                        
                        0All
      Other Fees
                        
                        
                        0
                        
                        
                        
                        0





In each
of the last two fiscal years ended December 31, 2008 and 2007, there were no
fees billed for assurance and related services by the principal accountant that
are reasonably related to the performance of the audit or review of our
financial statements and are not reported under Item 9(e)(1) of Schedule 14A,
for professional services rendered by the principal account for tax compliance,
tax advice, and tax planning, for products and services provided by the
principal accountant, other than the services reported in Item 9(e)(1) through
9(d)(3) of Schedule 14A.




Audit
Committee Pre-Approval of Audit and Permissible Non-Audit Services of
Independent Auditors




Given the
small size of our Board of Directors as well as the limited activities of our
Company, Our Board of Directors acts as our Audit Committee. Our Board of
Directors pre-approves all audit and permissible non-audit services. These
services may include audit services, audit-related services, tax services and
other services. Our Board of Directors approves these services on a case-by-case
basis.





PART
IV





ITEM
      15.
            EXHIBITS,
      FINANCIAL STATEMENT SCHEDULES





(a)
              Financial
      Statements and financial statement
schedules





(1) and
(2) The financial statements and financial statement schedules required to be
filed as part of this report are set forth in Item 8 of Part II of this
report.





(3)
Exhibits. See Item 15(b) below.





(b)
              Exhibits
      required by Item 601 of Regulation
S-K





Exhibit No.
                    
                    Description3.1
                    
                    Articles
      of Incorporation (incorporated by reference from our Registration
      Statement on Form S-1 filed on April 16, 2008).3.2
                    
                    Bylaws
      (incorporated by reference from our Registration Statement on Form S-1
      filed on April 16, 2008).31.1*
                    
                    Section
      302 Certification of the Sarbanes-Oxley Act of 2002 of Nehemya
      Hesin32.1*
                    
                    Section
      906 Certification of the Sarbanes-Oxley Act of 2002 of Nehemya
      Hesin





*Filed
herewith


16


SIGNATURES





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





BNH INC.
              (Registrant)By:
            /s/
      Nehemeya HesinName:
      Nehemya HesinTitle:
      President, Treasurer (Principal Executive Officer and Principal Financial
      and Accounting Officer) and DirectorDated:
      February 12, 2009




Pursuant
to the requirements of the Securities Exchange Act of 1934, this report has been
signed below by the following persons on behalf of the registrant and in the
capacities and on the dates indicated.





By:
            /s/
      Nehemya HesinName:
      Nehemya HesinTitle:
      President, Treasurer (Principal Executive Officer and Principal Financial
      and Accounting Officer) and DirectorDated:
      February 12, 2009


17




BNH
INC.


(A
DEVELOPMENT STAGE COMPANY)





INDEX
TO FINANCIAL STATEMENTS


DECEMBER
31, 2008 AND 2007





Report
      of Registered Independent Auditors
                      F-2Financial
      Statements-Balance
      Sheets as of December 31, 2008 and 2007
                      F-3Statements
      of Operations for the Years EndedDecember
      31, 2008 and 2007, and Cumulative from Inception
                      F-4Statement
      of Stockholders’ Equity for the Period from InceptionThrough
      December 31, 2008
                      F-5Statements
      of Cash Flows for the Years Ended December 31, 2008 and
    2007,and
      Cumulative from Inception
                      F-6Notes
      to Financial Statements
                      F-7


F-1




REPORT
OF REGISTERED INDEPENDENT AUDITORS





To the
Board of Directors and Stockholders


of BNH
Inc.:





We have
audited the accompanying balance sheets of BNH Inc. (a Nevada corporation in the
development stage) as of  December 31, 2008 and 2007, and the related
statements of operations, stockholders’ equity, and cash flows for years ended
December 31, 2008 and 2007, and from inception (September 4, 2007) through
December 31, 2008. 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 standards of the Public Company
Accounting Oversight Board (United States of America). Those standards require
that we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. The Company is not
required to have, nor were we engaged to perform, an audit of its internal
control over financial reporting. Our audit included consideration of internal
control over financial reporting as a basis for designing audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Company’s internal control over financial
reporting. Accordingly, we express no such opinion. An audit 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 financial statements referred to above present fairly, in all
material respects, the financial position of BNH Inc. as of December 31, 2008
and 2007, and the results of its operations and its cash flows for the years
ended December 31, 2008 and 2007, and from inception (September 4, 2007) through
December 31, 2008, in conformity with accounting principles generally accepted
in the United States of America.





The
accompanying financial statements have been prepared assuming that the Company
will continue as a going concern. As discussed in Note 2 to the financial
statements, the Company is in the development stage, and has not established any
source of revenue to cover its operating costs. As such, it has incurred an
operating loss since inception. Further, as of December 31, 2008, the cash
resources of the Company were insufficient to meet its planned business
objectives. These and other factors raise substantial doubt about the Company’s
ability to continue as a going concern. Management’s plan regarding these
matters is also described in Note 2 to the financial statements. The financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.





Respectfully
submitted,





/s/ Alan
Weinberg CPA





Weinberg
& Associates LLC


Baltimore,
Maryland


January
25, 2009


F-2


BNH
INC.


(A
DEVELOPMENT STAGE COMPANY)


BALANCE
SHEETS (NOTE 2)


AS
OF DECEMBER 31, 2008 AND 2007





2008
                    
                    
                    2007ASSETSCurrent
      Assets:Cash
      in bank
                    
                    $
                    6,354
                    
                    
                    $
                    26,440Prepaid
      expenses
                    
                    
                    287
                    
                    
                    
                    -Total
      current assets
                    
                    
                    6,641
                    
                    
                    
                    26,440Total
      Assets
                    
                    $
                    6,641
                    
                    
                    $
                    26,440LIABILITIES AND STOCKHOLDERS'
      EQUITYCurrent
      Liabilities:Accounts
      payable
                    
                    $
                    200
                    
                    
                    $
                    488Accrued
      liabilities
                    
                    
                    5,500
                    
                    
                    
                    20,500Due
      to shareholder
                    
                    
                    250
                    
                    
                    
                    250Total
      current liabilities
                    
                    
                    5,950
                    
                    
                    
                    21,238Total
      liabilities
                    
                    
                    5,950
                    
                    
                    
                    21,238Commitments
      and Contingencies
                    
                    
                    -
                    
                    
                    
                    -Stockholders'
      Equity:Preferred
      stock, par value $0.001 per share, 5,000,000 shares authorized; no shares
      issued and outstanding
                    
                    
                    -
                    
                    
                    
                    -Common
      stock, par value $0.001 per share, 100,000,000 shares authorized;
      7,000,000 and 6,000,000 shares issued  and outstanding
      respectively
                    
                    
                    7,000
                    
                    
                    
                    6,000Additional
      paid-in capital
                    
                    
                    48,000
                    
                    
                    
                    24,000Paid
      stock subscription
                    
                    
                    -
                    
                    
                    
                    1,000(Deficit)
      accumulated during development stage
                    
                    
                    (54,309
                    )
                    
                    
                    (25,798
                    )Total
      stockholders' equity
                    
                    
                    691
                    
                    
                    
                    5,202Total
      Liabilities and Stockholders' Equity
                    
                    $
                    6,641
                    
                    
                    $
                    26,440





The
accompanying notes to financial statements are


an
integral part of these statements.


F-3


BNH
INC.


(A
DEVELOPMENT STAGE COMPANY)


STATEMENTS
OF OPERATIONS (NOTE 2)


FOR
THE YEARS ENDED DECEMBER 31, 2008 AND 2007, AND


CUMULATIVE
FROM INCEPTION (SEPTEMBER 4, 2007)


THROUGH
DECEMBER 31, 2008





Year Ended
                    December 31,
                    2008
                  
                  
                  Year Ended
                    December 31,
                    2007
                  
                  
                  Cumulative
                    From
                    InceptionRevenues
                  
                  $
                  -
                  
                  
                  $
                  -
                  
                  
                  $
                  -Expenses:General
      and administrative-Professional
      fees
                  
                  
                  25,134
                  
                  
                  
                  20,500
                  
                  
                  
                  45,634Filing
      fees
                  
                  
                  2,713
                  
                  
                  
                  -
                  
                  
                  
                  2,713Officers'
      compensation paid by issued shares
                  
                  
                  -
                  
                  
                  
                  4,750
                  
                  
                  
                  4,750Organization
      costs
                  
                  
                  -
                  
                  
                  
                  488
                  
                  
                  
                  488Bank
      charges
                  
                  
                  664
                  
                  
                  
                  60
                  
                  
                  
                  724Total
      general and administrative expenses
                  
                  
                  28,511
                  
                  
                  
                  25,798
                  
                  
                  
                  54,309-(Loss)
      from Operations
                  
                  
                  (28,511
                  )
                  
                  
                  (25,798
                  )
                  
                  
                  (54,309
                  )Other
      Income (Expense)
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -Provision
      for income taxes
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -Net
      (Loss)
                  
                  $
                  (28,511
                  )
                  
                  $
                  (25,798
                  )
                  
                  $
                  (54,309
                  )(Loss)
      Per Common Share:(Loss)
      per common share - Basic and Diluted
                  
                  $
                  (0.00
                  )
                  
                  $
                  (0.01
                  )Weighted
      Average Number of Common Shares Outstanding - Basic and
      Diluted
                  
                  
                  6,983,616
                  
                  
                  
                  2,607,143





The
accompanying notes to financial statements are


an
integral part of these statements.


F-4


BNH
INC.


(A
DEVELOPMENT STAGE COMPANY)


STATEMENT
OF STOCKHOLDERS' EQUITY (NOTE 2)


FOR
THE PERIOD FROM INCEPTION (SEPTEMBER 4, 2007)


THROUGH
DECEMBER 31, 2008





(Deficit)AccumulatedAdditional
                    
                    
                    Paid
                    
                    
                    During theCommon stock
                    
                    
                    Paid-in
                    
                    
                    Stock
                    
                    
                    DevelopmentDescription
                    
                    Shares
                    
                    
                    Amount
                    
                    
                    Capital
                    
                    
                    Subscriptions
                    
                    
                    Stage
                    
                    
                    TotalsBalance
      - at inception
                    
                    
                    -
                    
                    
                    $
                    -
                    
                    
                    $
                    -
                    
                    
                    $
                    -
                    
                    
                    $
                    -
                    
                    
                    $
                    -Common
      stock issued for officers' compensation
                    
                    
                    4,750,000
                    
                    
                    
                    4,750
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    4,750Payment
      for stock subscriptions
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    1,000
                    
                    
                    
                    -
                    
                    
                    
                    1,000Common
      stock issued for cash
                    
                    
                    1,250,000
                    
                    
                    
                    1,250
                    
                    
                    
                    24,000
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    25,250Net
      (loss) for the year
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    (25,798
                    )
                    
                    
                    (25,798
                    )Balance
      - December 31, 2007
                    
                    
                    6,000,000
                    
                    
                    $
                    6,000
                    
                    
                    $
                    24,000
                    
                    
                    $
                    1,000
                    
                    
                    $
                    (25,798
                    )
                    
                    $
                    5,202Common
      stock issued for cash
                    
                    
                    1,000,000
                    
                    
                    
                    1,000
                    
                    
                    
                    24,000
                    
                    
                    
                    (1,000
                    )
                    
                    
                    -
                    
                    
                    
                    24,000Net
      (loss) for the year
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    (28,511
                    )
                    
                    
                    (28,511
                    )Balance
      - December 31, 2008
                    
                    
                    7,000,000
                    
                    
                    $
                    7,000
                    
                    
                    $
                    48,000
                    
                    
                    $
                    -
                    
                    
                    $
                    (54,309
                    )
                    
                    $
                    691





The
accompanying notes to financial statements are


an
integral part of these statements.


F-5




BNH
INC.


(A
DEVELOPMENT STAGE COMPANY)


STATEMENTS
OF CASH FLOWS (NOTE 2)


FOR
THE YEARS ENDED DECEMBER 31, 2008 AND 2007, AND


CUMULATIVE
FROM INCEPTION (SEPTEMBER 4, 2007)


THROUGH
DECEMBER 31, 2008





Year Ended
                  December 31,
                  2008
                
                
                Year Ended
                  December 31,
                  2007
                
                
                Cumulative
                  From
                  InceptionOperating
      Activities:Net
      (loss)
                
                $
                (28,511
                )
                
                $
                (25,798
                )
                
                $
                (54,309
                )Adjustments
      to reconcile net (loss) to net cash provided by operating
      activities:Common
      stock issued for officers' compensation
                
                
                -
                
                
                
                4,750
                
                
                
                4,750Changes
      in net assets and liabilities-Prepaid
      expenses
                
                
                (287
                )
                
                
                -
                
                
                
                (287
                )Accounts
      payable
                
                
                (288
                )
                
                
                488
                
                
                
                200Accrued
      liabilities
                
                
                (15,000
                )
                
                
                20,500
                
                
                
                5,500Net
      Cash Used in Operating Activities
                
                
                (44,086
                )
                
                
                (60
                )
                
                
                (44,146
                )Investing
      Activities:Cash
      provided by investing activities
                
                
                -
                
                
                
                -
                
                
                
                -Net
      Cash Provided by Investing Activities
                
                
                -
                
                
                
                -
                
                
                
                -Financing
      Activities:Loan
      from shareholder
                
                
                -
                
                
                
                250
                
                
                
                250Issuance
      of common stock for cash
                
                
                24,000
                
                
                
                26,250
                
                
                
                50,250Net
      Cash Provided by Financing Activities
                
                
                24,000
                
                
                
                26,500
                
                
                
                50,500Net
      (Decrease) Increase in Cash
                
                
                (20,086
                )
                
                
                26,440
                
                
                
                6,354Cash
      - Beginning of Period
                
                
                26,440
                
                
                
                -
                
                
                
                -Cash
      - End of Period
                
                $
                6,354
                
                
                $
                26,440
                
                
                $
                6,354Supplemental
      Disclosure of Cash Flow Information:Cash
      paid during the period for:Interest
                
                $
                -
                
                
                $
                -
                
                
                $
                -Income
      taxes
                
                $
                -
                
                
                $
                -
                
                
                $
                -Supplemental
      schedule of noncash investing and financing activities:Common
      stock issued as compensation to officers
                
                $
                -
                
                
                $
                4,750





The
accompanying notes to financial statements are an integral part of these
statements.


F-6


BNH
INC.
 (A
DEVELOPMENT STAGE COMPANY)
 NOTES
TO FINANCIAL STATEMENTS
  1.Summary of
Significant Accounting Policies





Basis
of Presentation and Organization





BNH Inc. (the “Company”) is a Nevada
corporation in the development stage, and has limited operations. The Company
was incorporated under the laws of the State of Nevada on September 4, 2007. The
proposed business plan of the Company is to establish the Company as a distributor
of bio-degradable plastic utensils. The accompanying financial statements of the
Company were prepared from the accounts of the Company under the accrual basis
of accounting.





On
September 4, 2007, pursuant to the terms of a subscription agreement, the
Company sold 250,000 shares of common stock to Mrs. Goldy Klein, Secretary, for
cash payment of $250 (par value).  The Company believes this issuance
was deemed to be exempt under Regulation S of the Securities Act.





On
October 18, 2007, the Company issued 1,500,000 shares of common stock, valued at
$1,500, to an officer of the Company for services rendered.





On
October 25, 2007, the Company issued 250,000 shares of common stock, valued at
$250, to an officer of the Company for services rendered.





On
November 12, 2007, the Company issued 3,000,000 shares of common stock, valued
at $3,000, to an officer of the Company for services rendered.





In
addition, on November 30, 2007, the Company began a capital formation activity
through a PPO, exempt from registration under the Securities Act of 1933, to
raise up to $50,000 through the issuance of 2,000,000 shares of its common
stock, par value $0.001 per share, at an offering price of $0.025 per share. As
of December 27, 2007, the Company had received $26,000 in proceeds from the
PPO.  As of January 23, 2008, the Company had fully subscribed the PPO
and raised $50,000 in proceeds with the issuance of 2,000,000 shares of its
common stock.





The
Company also commenced an activity to submit a Registration Statement on Form
S-1 to the Securities and Exchange Commission (“SEC”) to register 2,000,000 of
its outstanding shares of common stock on behalf of selling stockholders. The
Company will not receive any of the proceeds of this registration activity once
the shares of common stock are sold. The Registration Statement on Form S-1 was
filed with the SEC on April 16, 2008, and declared effective on April 30,
2008.





Cash and Cash
Equivalents





For
purposes of reporting within the statement of cash flows, the Company considers
all cash on hand, cash accounts not subject to withdrawal restrictions or
penalties, and all highly liquid debt instruments purchased with a maturity of
three months or less to be cash and cash equivalents.





Revenue
Recognition





The Company is in the development stage
and has yet to realize revenues from operations. Once the Company has commenced
operations, it will recognize revenues when delivery of goods or completion of
services has occurred provided there is persuasive evidence of an agreement,
acceptance has been approved by its customers, the fee is fixed or determinable
based on the completion of stated terms and conditions, and collection of any
related receivable is probable.




F-7




BNH
INC.
 (A
DEVELOPMENT STAGE COMPANY)
 NOTES
TO FINANCIAL STATEMENTS
  Loss
per Common Share





Basic
loss per share is computed by dividing the net loss attributable to the common
stockholders by the weighted average number of shares of common stock
outstanding during the period. Fully diluted loss per share is computed similar
to basic loss per share except that the denominator is increased to include the
number of additional common shares that would have been outstanding if the
potential common shares had been issued and if the additional common shares were
dilutive. There were no dilutive financial instruments issued or outstanding for
the period ended December 31, 2008.





Income
Taxes





The
Company accounts for income taxes pursuant to SFAS No. 109, “Accounting for Income Taxes”
(“SFAS 109”). Under SFAS 109, deferred tax assets and liabilities are determined
based on temporary differences between the bases of certain assets and
liabilities for income tax and financial reporting purposes. The deferred tax
assets and liabilities are classified according to the financial statement
classification of the assets and liabilities generating the
differences.





The
Company maintains a valuation allowance with respect to deferred tax assets. The
Company establishes a valuation allowance based upon the potential likelihood of
realizing the deferred tax asset and taking into consideration the Company’s
financial position and results of operations for the current period. Future
realization of the deferred tax benefit depends on the existence of sufficient
taxable income within the carryforward period under the federal tax
laws.





Changes
in circumstances, such as the Company generating taxable income, could cause a
change in judgment about the realizability of the related deferred tax asset.
Any change in the valuation allowance will be included in income in the year of
the change in estimate.





Fair
Value of Financial Instruments





The
Company estimates the fair value of financial instruments using the available
market information and valuation methods. Considerable judgment is required in
estimating fair value. Accordingly, the estimates of fair value may not be
indicative of the amounts the Company could realize in a current market
exchange. As of December 31, the carrying value of accounts payable-trade and
accrued liabilities approximated fair value due to the short-term nature and
maturity of these instruments.





Deferred
Offering Costs





The
Company defers as other assets the direct incremental costs of raising capital
until such time as the offering is completed. At the time of the completion of
the offering, the costs are charged against the capital raised. Should the
offering be terminated, deferred offering costs are charged to operations during
the period in which the offering is terminated.





Concentration
of Risk





As of
December 31, 2008, the Company maintained its cash account at one commercial
bank. The balance in the account was subject to FDIC coverage.





Common
Stock Registration Expenses





The
Company considers incremental costs and expenses related to the registration of
equity securities with the SEC, whether by contractual arrangement as of a
certain date or by demand, to be unrelated to original issuance transactions. As
such, subsequent registration costs and expenses are reflected in the
accompanying financial statements as general and administrative expenses, and
are expensed as incurred.




F-8


BNH
INC.
 (A
DEVELOPMENT STAGE COMPANY)
 NOTES
TO FINANCIAL STATEMENTS
 
 Lease
Obligations
 
 All
noncancellable leases with an initial term greater than one year are categorized
as either capital leases or operating leases. Assets recorded under capital
leases are amortized according to the methods employed for property and
equipment or over the term of the related lease, if shorter.
 
 Estimates
 
 The
financial statements are prepared on the basis of accounting principles
generally accepted in the United States. The preparation of financial statements
in conformity with generally accepted accounting principles requires management
to make estimates and assumptions that affect the reported amounts of assets and
liabilities as of December 31, 2008, and expenses for the period ended December
31, 2008, and cumulative from inception. Actual results could differ from those
estimates made by management.
 
 Fiscal
Year End
 
 The
Company has adopted a fiscal year end of December 31.
 
 Recent Accounting
Pronouncements
  In June
2008, the Financial Accounting Standards Board (“FASB”) issued FASB Staff
Position No. EITF No. 03-6-1, “Determining Whether Instruments Granted
in Share-Based Payment Transactions Are Participating Securities” (“FSP EITF
No. 03-6-1”). According to FSP EITF No. 03-6-1, unvested share-based
payment awards that contain nonforfeitable rights to dividends or dividend
equivalents are considered participating securities under SFAS No. 128. As
such, they should be included in the computation of basic earnings per share
(“EPS”) using the two-class method. FSP EITF No. 03-6-1 is effective for
financial statements issued for fiscal years beginning after December 15,
2008, as well as interim periods within those years. Once effective, all
prior-period EPS data presented must be adjusted retrospectively. The Company
does not expect FSP EITF No. 03-6-1 to have a material impact on the
Company’s financial position or results of operations.
 
 In March
2008, the FASB issued Statement No. 161, “Disclosures about Derivative
Instruments and Hedging Activities”, an amendment of FASB Statement No. 133
(“SFAS No. 161”). SFAS No. 161 applies to all derivative
instruments and nonderivative instruments that are designated and qualify as
hedging instruments and related hedged items accounted for under
SFAS No. 133. SFAS No. 161 requires entities to provide greater
transparency through additional disclosures about (a) how and why an entity
uses derivative instruments, (b) how derivative instruments and related
hedged items are accounted for under SFAS No. 133 and its related
interpretations, and (c) how derivative instruments and related hedged
items affect an entity’s financial position, results of operations, and cash
flows. SFAS No. 161 is effective for financial statements issued for
fiscal years and interim periods beginning after November 15, 2008. The
Company does not expect SFAS No. 161 to have a material impact on the
Company’s financial position or results of operations.
 
 In
December 2007, the FASB issued Statement No. 141 (revised), “Business
Combinations” (“SFAS No. 141(R)”). SFAS No. 141(R)
significantly changes the accounting for business combinations and establishes
principles and requirements for how an acquirer recognizes and measures in its
financial statements the identifiable assets acquired, the liabilities assumed
and any noncontrolling interest in the acquiree and recognizes and measures the
goodwill acquired in the business combination or a gain from a bargain purchase.
SFAS No. 141(R) applies prospectively to business combinations for
which the acquisition date is on or after the beginning of the first annual
reporting period beginning on or after December 15, 2008.
  F-9
  BNH
INC.
 (A
DEVELOPMENT STAGE COMPANY)
 NOTES
TO FINANCIAL STATEMENTS
 
 In
December 2007, the FASB issued Statement No. 160, “Noncontrolling Interests
in Consolidated Financial Statements” - an amendment of ARB No. 51
(“SFAS No. 160”). SFAS No. 160 changes the accounting for
noncontrolling (minority) interests in consolidated financial statements
including the requirements to classify noncontrolling interests as a component
of consolidated shareholders’ equity, the elimination of “minority interest”
accounting in results of operations and changes in the accounting for both
increases and decreases in a parent’s controlling ownership interest.
SFAS No. 160 is effective for fiscal years beginning after
December 15, 2008, and early adoption is prohibited. The Company does not
expect SFAS No. 160 to have a material impact on the Company’s
financial position or results of operations.
 
 In
February 2007, the FASB issued Statement No. 159 “The Fair Value Option for
Financial Assets and Financial Liabilities” including an amendment of FASB
Statement No. 115 (“SFAS No. 159”), which allows an entity the
irrevocable option to elect fair value for the initial and subsequent
measurement for certain financial assets and liabilities under an
instrument-by-instrument election. If the fair value option is elected for an
instrument, subsequent changes in fair value for that instrument will be
recognized in earnings. SFAS No. 159 also establishes additional
disclosure requirements and is effective for fiscal years beginning after
November 15, 2007, with early adoption permitted provided that the entity
also adopts Statement No. 157, “Fair Value Measurements”
(“SFAS No. 157”). SFAS No. 159 is not expected to have a
material impact on its results of operations or financial position.
 
 In
September 2006, the FASB issued SFAS No. 157 which defines fair value,
establishes a framework for measuring fair value in generally accepted
accounting principles, and expands disclosures about fair value measurements.
SFAS No. 157 applies under other accounting pronouncements that
require or permit fair value measurements. SFAS No. 157 is effective
for fiscal years beginning after November 15, 2007, and interim periods
within those fiscal years. In February 2008, the FASB issued FASB Staff Position
No. SFAS No. 157-2, Effective Date of FASB Statement No. 157,
which provides a one-year deferral of the effective date of
SFAS No. 157 for non-financial assets and non-financial liabilities,
except those that are recognized or disclosed in the financial statements at
fair value on a recurring basis (at least annually). The adoption of
SFAS No. 157 for financial assets and financial liabilities is not
expected to have a material impact on the Company’s results of operations or
financial position.
 
 2. Development Stage
Activities and Going Concern
 
 The
Company is currently in the development stage, and has not commenced operations.
The business plan of the Company is to establish the Company as a distributor of
bio-plastic utensils.
 
 During
the period ended June 30, 2008 and December 31, 2007, the Company began a
capital formation activity through a PPO, exempt from registration under the
Securities Act of 1933, to raise up to $50,000 through the issuance of 2,000,000
shares of its common stock, par value $0.001 per share, at an offering price of
$0.025 per share. As of January 23, 2008, the Company had fully subscribed the
PPO and raised $50,000 in proceeds with the issuance of 2,000,000 shares of its
common stock.
 
 The Company also commenced an activity
to submit a Registration Statement on Form S-1 to the Securities and Exchange
Commission (“SEC”) to register 2,000,000 of its outstanding shares of common
stock on behalf of selling stockholders. The Company will not receive any of the
proceeds of this registration activity once the shares of common stock are
sold.The Registration
Statement on Form S-1 was filed with the SEC on April 16, 2008, and declared
effective on April 30, 2008.
  F-10
  BNH
INC.
 (A
DEVELOPMENT STAGE COMPANY)
 NOTES
TO FINANCIAL STATEMENTS
 
 The
accompanying financial statements have been prepared in conformity with
accounting principles generally accepted in the United States, which contemplate
continuation of the Company as a going concern. The Company has not established
any source of revenues to cover its operating costs, and as such, has incurred
an operating loss since inception. Further, as of December 31, 2008 and December
31, 2007, the cash resources of the Company were insufficient to meet its
current business plan. These and other factors raise substantial doubt about the
Company’s ability to continue as a going concern. The accompanying financial
statements do not include any adjustments to reflect the possible future effects
on the recoverability and classification of assets or the amounts and
classification of liabilities that may result from the possible inability of the
Company to continue as a going concern.
 
 3.   Loan
from Stockholder
 
 As of
December 31, 2008, a loan from an individual who is a stockholder of the Company
amounted to $250. The loan was provided for working capital purposes, and is
unsecured, non-interest bearing, and has no terms for repayment.
 
 4. Common
Stock
 
 On
September 4, 2007, pursuant to the terms of a subscription agreement, the
Company sold 250,000 shares of common stock to Mrs. Goldy Klein, Secretary, for
cash payment of $250 (par value).  The Company believes this issuance
was deemed to be exempt under Regulation S of the Securities Act.
 
 On
October 18, 2007, the Company issued 1,500,000 shares of common stock, valued at
$1,500, to an officer of the Company for services rendered.
 
 On
October 25, 2007, the Company issued 250,000 shares of common stock, valued at
$250, to an officer of the Company for services rendered.
 
 On
November 12, 2007, the Company issued 3,000,000 shares of common stock, valued
at $3,000, to an officer of the Company for services rendered.
 
 In
addition, on November 30, 2007, the Company began a capital formation activity
through a PPO, exempt from registration under the Securities Act of 1933, to
raise up to $50,000 through the issuance of 2,000,000 shares of its common
stock, par value $0.001 per share, at an offering price of $0.025 per share. As
of December 27, 2007, the Company had received $26,000 in proceeds from the PPO.
As of January 23, 2008, the Company had fully subscribed the PPO and raised
$50,000 in proceeds with the issuance of 2,000,000 shares of its common
stock.
 
 The
Company also commenced an activity to submit a Registration Statement on Form
S-1 to the Securities and Exchange Commission (“SEC”) to register 2,000,000 of
its outstanding shares of common stock on behalf of selling stockholders. The
Company will not receive any of the proceeds of this registration activity once
the shares of common stock are sold.  The Registration Statement on
Form S-1 was filed with the SEC on April 16, 2008, and declared effective on
April 30, 2008.
 
 5. Income
Taxes
 
 The
provision (benefit) for income taxes for the period ended December 31, 2008 and
2007, was as follows (assuming a 23% effective tax rate):
  F-11
  BNH
INC.
 (A
DEVELOPMENT STAGE COMPANY)
 NOTES
TO FINANCIAL STATEMENTS
  2008
                                  
                                  
                                  2007Current
      Tax Provision:Federal-Taxable
      income
                                  
                                  $
                                  -
                                  
                                  
                                  $
                                  -Total
      current tax provision
                                  
                                  $
                                  -
                                  
                                  
                                  $
                                  -Deferred
      Tax Provision:Federal-Loss
      carryforwards
                                  
                                  $
                                  6,558
                                  
                                  
                                  $
                                  5,934Change
      in valuation allowance
                                  
                                  
                                  (6,558
                                  )
                                  
                                  
                                  (5,934
                                  )Total
      deferred tax provision
                                  
                                  $
                                  -
                                  
                                  
                                  $
                                  -
 
 The
Company had deferred income tax assets as of December 31, 2008 and 2007, as
follows:
  2008
                                        
                                        
                                        2007Loss
      carryforwards
                                        
                                        $
                                        12,491
                                        
                                        
                                        $
                                        5,934Less
      - Valuation allowance
                                        
                                        
                                        (12,491
                                        )
                                        
                                        
                                        (5,934
                                        )Total
      net deferred tax assets
                                        
                                        $
                                        -
                                        
                                        
                                        $
                                        -
  The
Company provided a valuation allowance equal to the deferred income tax assets
for the periods ended December 31, 2008 and 2007 because it is not presently
known whether future taxable income will be sufficient to utilize the loss
carryforwards.
 
 As of
December 31, 2008, the Company had approximately $54,309 in tax loss
carryforwards that can be utilized in future periods to reduce taxable income,
and expire in the year 2028.
  6.   Related
Party Transactions
 
 On
September 4, 2007, pursuant to the terms of a subscription agreement, the
Company sold 250,000 shares of common stock to Mrs. Goldy Klein, Secretary, for
cash payment of $250 (par value).  The Company believes this issuance
was deemed to be exempt under Regulation S of the Securities Act.
 
 On
October 18, 2007, the Company issued 1,500,000 shares of common stock, valued at
$1,500 to an officer of the Company for services rendered.
 
 On
October 25, 2007, the Company issued 250,000 shares of common stock, valued at
$250 to an officer of the Company for services rendered.
 
 On
November 12, 2007, the Company issued 3,000,000 shares of common stock, valued
at $3,000 to an officer of the Company for services rendered.
 
 As
described in Note 3, as of December 31, 2008, the Company owed $250 to an
individual who is a stockholder of the Company.
  F-12