**SECURITIES
AND EXCHANGE COMMISSION**


**Washington,
D.C. 20549**





**FORM
10-KSB**





[ X
]  Annual
Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
for the fiscal year ended December 31, 2004.





[
]  Transitional
Report Under Section 13 or 15(d) of the Securities Exchange Act of 1934 for the
transition period from _______________ to ________________.





____________________________________________





Commission
      File No. 000-26673**VITASTI,
      INC.**
      (Name
      of small business issuer in its charter)


_____________________________________________








Delaware
    98-0207081(State
      or other Jurisdiction
      of
      Incorporation or Organization)
    (IRS
      Employer
      Identification
      Number)





100-1001
      Churchill Crescent
      North
      Vancouver, B.C., Canada
    V7P
      1T2(Address
      of Principal Executive Offices)
    (Zip
      Code)





**(604)
980-6693**


(Issuer's
Telephone Number)





Securities
      registered under Section 12(g) of the Act:
    NoneSecurities
      to be registered under Section 12(g) of the Act:
    None





Check
whether the issuer (1) 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 Company was required to file such reports), and
(2) has been subject to such filing requirements for the past 90 days.





Yes [ X ]
No [ ].





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





Issuer's
revenues for its most recent fiscal year: $67,414.





State the
aggregate market value of the voting stock and non-voting equity held by
non-affiliates computed by reference to the price at which the stock was sold,
or the average bid and asked prices of such stock, as of April 7, 2005, was
$0.10.





State the
number of shares outstanding of each of the issuer's classes of common equity,
as of the latest practicable date: As of April 11, 2005, there were 25,165,452
shares of the Company's common stock issued and outstanding.





Transitional
Small Business Disclosure Format: Yes [ X ] No [ ].








TABLE OF
CONTENTS


FORM
10-KSB ANNUAL REPORT


_________________________





VITASTI,
INC.





Section
    Heading
    PagePart
      IItem
      1
    Description
      of BusinessItem
      2
    Description
      of PropertyItem
      3
    Legal
      ProceedingsItem
      4
    Submission
      of Matters to a Vote of Security HoldersPart
      IIItem
      5
    Market
      for the Registrant's Common Equity and Related Stockholder
      MattersItem
      6
    Management's
      Discussion and Analysis of Financial Condition and Results of OperationsItem
      7
    Financial
      Statements with Index and Auditor's ReportItem
      8
    Changes
      in and Disagreements on Accounting and Financial
DisclosureItem
      8A
    Controls
      and ProceduresItem
      8B
    Other
      InformationPart
      IIIItem
      9
    Directors,
      Executive Officers, Promoters and Control Persons, Compliance with Section
      16(a) of the Exchange ActItem
      10
    Executive
      CompensationItem
      11
    Security
      Ownership of Certain Beneficial Owners and ManagementItem
      12
    Certain
      Relationships and Related TransactionsPart
      IVItem
      13
    Exhibits
      and Reports on Form 8-KItem
      14Signatures














**Part
I.**





*The
following discussion should be read in conjunction with our audited financial
statements and notes thereto included herein. In connection with, and because we
desire to take advantage of, the "safe harbor" provisions of the Private
Securities Litigation Reform Act of 1995, we caution readers regarding certain
forward looking statements in the following discussion and elsewhere in this
report and in any other statement made by, or on our behalf, whether or not in
future filings with the Securities and Exchange Commission. Forward-looking
statements are statements not based on historical information and which relate
to future operations, strategies, financial results or other developments.
Forward looking statements are necessarily based upon estimates and assumptions
that are inherently subject to significant business, economic and competitive
uncertainties and contingencies, many of which are beyond our control and many
of which, with respect to future business decisions, are subject to change.
These uncertainties and contingencies can affect actual results and could cause
actual results to differ materially from those expressed in any forward looking
statements made by, or our behalf. We disclaim any obligation to update
forward-looking statements.*





*These
forward looking statements involve known and unknown risks, uncertainties and
other factors that may cause our actual results, levels of activity,
performance, or achievements to be materially different from any future results,
levels of activity, performance, or achievement expressed or implied by such
forward-looking statements. In some cases, you can identify forward-looking
statements by terminology such as "may," "will," "should," "could," "intend,"
"expects," "plan," "anticipates," "believes," "estimates," "predicts,"
"potential," or "continue" or the negative of such terms or other comparable
terminology. 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. Moreover, neither we nor any
other person assumes responsibility for the accuracy and completeness of such
statements.*





**Item
1.**  **Description
of the Business.**





**History
of the Company**





Vitasti,
Inc. ("we," "us," "our," or the "Company") was incorporated on December 18, 1997
pursuant to the laws of the State of Delaware under the name of Autoeye, Inc.





On
February 25, 2000, as part of an acquisition of The Forest Industry Online Inc.,
we changed our name to forestindustry.com, Inc. Prior to this acquisition, our
Company was inactive.





On
October 25, 2002, we entered into a share exchange agreement with GolfLogix
Systems Canada, Inc. ("GolfLogix Canada"), a British Columbia, Canada
corporation that was incorporated in February 2000, as West Coast Electric
Vehicle Distributors, Inc.





Under the
terms of the Share Exchange Agreement, we acquired all of the outstanding shares
of GolfLogix Canada in exchange for 2,500,000 shares of our common stock. As a
result, GolfLogix Canada became a wholly owned subsidiary of our
Company.





Prior to
the acquisition of Golflogix Canada, our business activities included designing
web sites and operating and maintaining a computer internet web site for
companies associated with the forest and wood product industries. However,
subsequent to the acquisition of this business we failed to generate
profitability and incurred negative cash flows from operations. We incurred a
loss of ($392,124) for our fiscal year ending May 31, 2002, and had a working
capital deficiency of ($515,454). Operations were financed mainly through the
issuance of our securities and our future operations were dependant upon
continued external funding and our ability to increase revenues and reduce
expenses. There were no assurances that the above conditions would occur and as
a result, our then management believed it to be in the best interest of our
shareholders to engage in the aforesaid transaction with GolfLogix Canada.





GolfLogix
Canada is a distributor of golfing merchandise and has entered into an agreement
to purchase an exclusive right to market and distribute the GolfLogix System in
Canada.





After our
acquisition of GolfLogix Canada, on November 30, 2002, we entered into a stock
purchase agreement with Cherry Point Consulting, resulting in a divestiture of
the assets of Forest Industry Online. Under the agreement, Cherry Point
Consulting purchased shares of Forest Industry Online and assumed all of the
related assets and liabilities of the same. On January 7, 2003, our name was
formally changed to Global Golf Holdings, Inc.





On June
27, 2003, the Company paid $50,000 to execute a licensing agreement for the
distribution of the GolfLogix System for Western Canada.





On April
15, 2004, the Company filed a Form 8-K announcing that due to lack of success in
executing the Company’s business plan and considerable underfunding of the same,
that the Board of Directors determined that it was no longer viable to continue
operations under the current business plan.





In
accordance with the foregoing, the Company announced the retention of Business
Consulting Group Unlimited (“BCGU”). BCGU was retained in order to assist the
Company in winding down the failed operations of the Company and to assist in
identifying and developing a new strategic operational focus for the Company.
BCGU proceeded to assist the Company in reducing its debt and the number of
outstanding liabilities. BCGU was able to secure debt assignment agreements and
debt settlement agreements from several of the largest Company creditors
including, $193,158.00 in debt in consideration for the issuance of 5,000,000
restricted shares.





During
2004, the Company issued 5,204,190 common shares to settle demand loans and
amounts due and owing to shareholders. Additionally, the Company cancelled
900,000 shares that had been issued for cash. Accordingly, at May 31, 2004, the
Company reflected an amount due and owing to two shareholders of $34,510.00.





On
October 1, 2004, the Company and LCC, as hereinafter defined, executed a
Definitive Acquisition Agreement. In addition to acquiring substantially all of
the assets of LCC, the Company agreed to assume up to USD $425,000 in LCC
convertible notes.





On
November 23, 2004, and with the assistance of BCGU, the Registrant closed on an
Acquisition Agreement (the “Agreement”) to purchase the assets and related
business of Low Carb Centre, Inc. (“LCC”), Low Carb Bakery, Inc. (“LCB”), and
McNabb & Associates (“MNA”). LCC is a privately held company organized under
the laws of British Columbia, Canada with its primary business being the retail
sales and distribution of gourmet low carbohydrate food products through its two
traditional brick-and-mortar retail stores and the world wide web at
www.lowcarbcentre.com. LCB is a privately held company organized under the laws
of British Columbia, Canada with its primary business being the manufacturing of
food products for the LCC retail market. MNA is a privately held company
organized under the laws of British Columbia, Canada with its primary business
being the management and supervision of the business operations of both LCC and
LCB. LCC, LCB and MNA shall be collectively hereinafter be referred to
hereinafter as “LCC” or “Sellers.”





Under the
terms of the Agreement (referred to as the “LCC Transaction”), the Registrant
acquired substantially all of the assets of LCC, including, but not limited to,
LCC’s suppliers, customer and vendor lists and records pertaining thereto, the
trade names “Low Carb Centre,” “Low Carb Bakery” and “McNabb and Associates,”
all registered and unregistered trademarks, service marks, sales marks, colors,
names and slogans relating to the business, and all applications for any of the
foregoing, together with all of the Sellers’ rights to use all of the foregoing
forever, and all goodwill associated with the foregoing, the existing phone
number(s) and websites of the business, all assets referred to or referenced
within any audited financial statements of the business in preparation or
consideration of the closing of the LCC Transaction and any and all recipes,
trade secrets, trade practices, décor, goodwill, clients, equipment, furniture,
assets, machinery, trade fixtures, miscellaneous supplies, inventory, existing
contracts and tangible personal property.





GGLF did
not assume any liabilities of LCC, with the exception of a series of 12%
Convertible Promissory Notes (the “Notes”) issued by LCC in connection with this
transaction. The Notes shall be converted (the “Conversion”) into common shares
of the Registrant at $0.125 per share. The Conversion shall include the
principal amount of the respective Note along with any unpaid interest. Each
Noteholder has an additional 25% warrant exercisable at $0.15 per share. The
issuance of the Notes provided necessary capital in order to allow LCC to remain
operational during the pendency of the LCC Transaction. As of November 30, 2004,
the Registrant assumed 11 Notes in the total aggregate amount of USD$221,962.





Consideration
for the LCC Transaction was 14,743,199 newly issued shares of the Registrant
post-reverse split. The terms and conditions of the Agreement were determined in
arm’s length negotiations between the Registrant and LCC.





The terms
and conditions of the Asset Purchase Agreement were determined in arm’s length
negotiations between the Company and LCC.




**Government
Regulations**





All of
the Registrant’s food products and packaging materials are subject to
regulations administered by the United States Food and Drug Administration
(“FDA”) or, with respect to products containing meat and poultry, the United
States Department of Agriculture, and their respective equivalents in Canada.
Among other things, these agencies enforce statutory prohibitions against
misbranded and adulterated foods, establish safety standards for food
processing, establish ingredients and manufacturing procedures for certain
foods, establish standards of identity for certain foods, determine the safety
of food additives and establish labeling standards and nutrition labeling
requirements for food products.





Almost
all of the activities of the Registrant’s food operations outside of the United
States are subject to local and national regulations similar to those applicable
to Vitasti in the United States and, in some cases, international regulatory
provisions, such as those of the European Union relating to labeling, packaging,
food content, pricing, marketing and advertising and related areas.





The
European Union and certain individual countries require that food products
containing genetically modified organisms or classes of ingredients derived from
them be labeled accordingly. Other countries may adopt similar regulations. The
FDA has concluded that there is no basis for similar mandatory labeling under
current United States law.





**Item
2.**  **Description
of the Property.**





Our
administrative offices and research facilities are located in North Vancouver
and Coquitlam, British Columbia Canada. We lease approximately 2500 square feet
of industrial space for $2,500 per month, manufacturing space of approximately
1500 square feet for $1,750 per month and retail space of approximately 1700
square feet at $5400.00 per month. Collectively, all of the space we lease is
utilized for retail sales, research and development, as offices and for
production purposes. All of the Registrant’s leases expire in 2008. It is our
belief that the various spaces are adequate for our immediate needs. Additional
space may be required as we expand our research and development activities. We
do not foresee any significant difficulties in obtaining any required additional
facilities.





**Item
3.**  **Legal
Proceedings.**





There are
currently no pending legal matters.





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





A
shareholder meeting was not held during this fiscal year.

















**PART
II.**





**Item
5. Market for Common Equity and Related Stockholder
Matters.**





Our
common stock is quoted on the OTC Bulletin Board under the symbol “VITS.” Prior
to December 9, 2004, our common stock was traded on the OTC Bulletin Board under
the symbol “GGLF.” For the periods indicated, the following table sets forth the
high and low bid prices per share of our common stock. These prices represent
inter-dealer quotations without retail markup, markdown, or commission and may
not necessarily represent actual transactions. We completed a 1 for 34 reverse
stock split on December 9, 2004, and all of the prices in the following tables
have been adjusted to reflect this split.





**FISCAL
      YEAR 2004**
    **HIGH
      BID**
    **LOW
      BID**First
      Quarter
    $10.20
    $4.08Second
      Quarter
    $5.10
    $0.68Third
      Quarter
    $1.36
    $0.34Fourth
      Quarter
    $0.59
    $0.20








**FISCAL
      YEAR 2003**
    **HIGH
      BID**
    **LOW
      BID**First
      Quarter
    $7.14
    $2.72Second
      Quarter
    $5.78
    $2.04Third
      Quarter
    $6.12
    $1.70Fourth
      Quarter
    $9.18
    $3.40





Trades of
our common stock are subject to Rule 15g-9 of the Securities and Exchange
Commission, known as the Penny Stock Rule. This rule imposes requirements on
broker/dealers who sell securities subject to the rule to persons other than
established customers and accredited investors. For transactions covered by the
rule, brokers/dealers must make a special suitability determination for
purchasers of the securities and receive the purchaser’s written agreement to
the transaction prior to sale. The Securities and Exchange Commission also has
rules that regulate broker/dealer practices in connection with transactions in
“penny stocks.” Penny stocks generally are equity securities with a price of
less than $5.00 (other than securities registered on certain national securities
exchanges or quoted on the NASDAQ system, provided that current price and volume
information with respect to transactions in that security is provided by the
exchange or system). The Penny Stock Rules requires a broker/ dealer, prior to a
transaction in a penny stock not otherwise exempt from the rules, to deliver a
standardized risk disclosure document prepared by the Commission that provides
information about penny stocks and the nature and level of risks in the penny
stock market. The broker/dealer also must provide the customer with current bid
and offer quotations for the penny stock, the compensation of the broker/dealer
and its salesperson in the transaction, and monthly account statements showing
the market value of each penny stock held in the customer’s account. The bid and
offer quotations, and the broker/dealer and salesperson compensation
information, must be given to the customer orally or in writing prior to
effecting the transaction and must be given to the customer in writing before or
with the customer’s confirmation. These disclosure requirements have the effect
of reducing the level of trading activity in the secondary market for our common
stock. As a result of these rules, investors may find it difficult to sell their
shares.





**Holders**





As of
December 31, 2004, there were approximately 112 record owners of our common
stock.





**Dividends**





We have
never paid cash dividends and have no plans to do so in the foreseeable future.
Our future dividend policy will be determined by our board of directors and will
depend upon a number of factors, including our financial condition and
performance, our cash needs and expansion plans, income tax consequences, and
the restrictions that applicable laws, our current preferred stock instruments,
and our future credit arrangements may then impose.





**Recent
Sales Of Unregistered Securities; Use Of Proceeds From Registered
Securities**





There
have been no sales of unregistered securities within the last three years, which
would be required to be disclosed pursuant to Item 701 of Regulation S-B, except
for those already disclosed in the Form 10-QSBs and Form 8-Ks filed during the
2004 calendar year, all of which are incorporated by reference
herein.





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





*The
following discussion should be read in conjunction with our audited financial
statements and notes thereto included herein. In connection with, and because we
desire to take advantage of, the "safe harbor" provisions of the Private
Securities Litigation Reform Act of 1995, we caution readers regarding certain
forward looking statements in the following discussion and elsewhere in this
report and in any other statement made by, or on our behalf, whether or not in
future filings with the Securities and Exchange Commission. Forward-looking
statements are statements not based on historical information and which relate
to future operations, strategies, financial results or other developments.
Forward looking statements are necessarily based upon estimates and assumptions
that are inherently subject to significant business, economic and competitive
uncertainties and contingencies, many of which are beyond our control and many
of which, with respect to future business decisions, are subject to change.
These uncertainties and contingencies can affect actual results and could cause
actual results to differ materially from those expressed in any forward looking
statements made by, or our behalf. We disclaim any obligation to update
forward-looking statements.*





**Critical
Accounting Policies** .





Our
critical and significant accounting policies, including the assumptions and
judgments underlying them, are disclosed in the Notes to the Financial
Statements. These policies have been consistently applied in all material
respects and address such matters as revenue recognition and depreciation
methods. The preparation of the financial statements in conformity with
generally accepted accounting principles in the United States requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of revenues and
expenses during the reported period. Actual results could differ from those
estimates.





**Overview** .





The
Company was incorporated on December 18, 1997, pursuant to the laws of the State
of Delaware under the name of Autoeye Inc. On February 25, 2000, as part of an
acquisition of The Forest Industry Online Inc., we changed our name to
forestindustry.com, Inc. Prior to this acquisition, our Company was inactive. On
October 25, 2002, we entered into a share exchange agreement with GolfLogix,
Inc., a British Columbia, Canada corporation (“GolfLogix Canada”) that was
incorporated in February 2000, as West Coast Electric Vehicle Distributors, Inc.
Under the terms of the Share Exchange Agreement, we acquired all of the
outstanding shares of GolfLogix Canada in exchange for 2,500,000 shares of our
common stock. As a result, GolfLogix Canada was a wholly owned subsidiary of our
Company.





Prior to
the acquisition of Golflogix Canada, our business activities included designing
web sites and operating and maintaining a computer internet web site for
companies associated with the forest and wood product industries. However,
subsequent to the acquisition of this business we failed to generate
profitability and incurred negative cash flows from operations. GolfLogix
Canada, a distributor of golfing merchandise and has entered into an agreement
to purchase a licensing right to market and distribute the GolfLogix System in
Canada.





After our
acquisition of GolfLogix Canada, on November 30, 2002, we entered into a stock
purchase agreement with Cherry Point Consulting, resulting in a divestiture of
the assets of Forest Industry Online. Under the agreement, Cherry Point
Consulting purchased shares of Forest Industry Online and assumed all of the
related assets and liabilities of the same. On January 7, 2003, we changed our
name to Global Golf Holdings, Inc.





On April
15, 2004, the Company filed a Form 8-K announcing that due to lack of success in
executing the Company’s business plan and considerable underfunding of the same,
that the Board of Directors had determined that it was no longer viable to
continue operations under the current business plan. In accord with the
foregoing, the Company announced the retention of BCGU. BCGU was retained in
order to assist the Company in winding down the failed operations of the Company
and to assist in identifying and developing a new strategic operational focus
for the Company. BCGU, to date, has helped the Company reduce its debt and the
number of outstanding liabilities. BCGU was able to secure debt assignment
agreements and debt settlement agreements from several of the largest Company
creditors. Including, $193,158.00 in debt in consideration for the issuance of
5,000,000 restricted shares.





On
November 23, 2004, with the assistance of BCGU, the Registrant closed on the
Agreement with LCC. LCC is a privately held company organized under the laws of
British Columbia, Canada with its primary business being the retail sales and
distribution of gourmet low carbohydrate food products through its four
traditional brick-and-mortar retail stores and the world wide web at
www.lowcarbcentre.com. LCB is a privately held company organized under the laws
of British Columbia, Canada with its primary business being the manufacturing of
food products for the LCC retail market. MNA is a privately held company
organized under the laws of British Columbia, Canada with its primary business
being the management and supervision of the business operations of both LCC and
LCB.





Under the
terms of the LCC Transaction, the Registrant acquired substantially all of the
assets of LCC, including, but not limited to, LCC’s suppliers, customer and
vendor lists and records pertaining thereto, the trade names “Low Carb Centre,”
“Low Carb Bakery” and “McNabb and Associates,” all registered and unregistered
trademarks, service marks, sales marks, colors, names and slogans relating to
the business, and all applications for any of the foregoing, together with all
of the Sellers’ rights to use all of the foregoing forever, and all goodwill
associated with the foregoing, the existing phone number(s) and websites of the
business, all assets referred to or referenced within any audited financial
statements of the business in preparation or consideration of the closing of the
LCC Transaction and any and all recipes, trade secrets, trade practices, décor,
goodwill, clients, equipment, furniture, assets, machinery, trade fixtures,
miscellaneous supplies, inventory, existing contracts and tangible personal
property.





GGLF did
not assume any liabilities of LCC, with the exception of the Notes. The Notes
shall be converted (the “Conversion”) into common shares of the Registrant at
$0.125 per share. The Conversion shall include the principal amount of the
respective Note along with any unpaid interest. Each Noteholder has an
additional 25% warrant exercisable at $0.15 per share. The issuance of the Notes
provided necessary capital in order to allow LCC to remain operational during
the pendency of the LCC Transaction. As of November 30, 2004, the Registrant
assumed 11 Notes in the total aggregate amount of USD$177,606.12.





Consideration
for the LCC Transaction was 14,743,199 newly issued shares of the Registrant
post-reverse split. The terms and conditions of the Agreement were determined in
arm’s length negotiations between the Registrant and LCC.





The terms
and conditions of the Asset Purchase Agreement were determined in arm’s length
negotiations between the Company and LCC.





**Results
of Operations for the seven months ended December 31, 2004 as compared with the
prior fiscal year ended May 31, 2004** .





We
generated $67,414 in revenues during the seven months ended December 31, 2004
versus $14,080 for the year ended May 31, 2004.





**Operating
Expenses** .





Operating
expenses arose primarily from professional and consulting fees, a majority of
which were incurred as a result of the retention of BCGU and the LCC
Transaction. We incurred professional fees relating to costs associated with our
being a reporting company under the Securities Exchange Act of 1934, as amended,
as well as costs associated with the acquisition the LCC Companies and other
minimal interest expenses on outstanding debt. As a result, we incurred a net
loss of $2,445,976 during the seven month period ended December 31, 2004
(approximately $0.64 per share).





**Plan
Of Operation For The Next Twelve Months** .





During
2004 and to date in 2005, we successfully completed several important milestones
that we believe were fundamental to our being able to achieve growth from our
low carb operations. These milestones include:





·
    Development
      of several private label products currently being sold under the brand
      name “Carb Craver Alternatives”


·
    First
      to market in North America as an all inclusive Wellness Centre leading to
      significant media attention


·
    Development
      of a franchise model for planned future growth of Vitasti Lifestyle
      Markets


·
    Completed
      significant research and development paving the way for future leading
      edge products


·
    Becoming
      a publicly traded Company by and through the LCC
    Transaction





As a
result of the achievement of these milestones, and our marketing and business
development efforts, which commenced prior to achieving these milestones, can be
implemented with much greater effort and results. Our efforts are still aimed
toward promoting our products and services that we offer presently, and those
that we may offer in the future. A significant portion of the capital currently
available to us will be used to provide the marketing and business development
resources needed to achieve wider distribution and recognition of our services
and products in the global market. We are presently shipping our products
(packaged and in bulk) to Asian countries such as Korea that are currently
realizing the low carb boom.





Our cash
requirements depend on numerous factors, including product development
activities, penetration of the direct sales market, market acceptance of new
products, and effective management of inventory levels in response to sales
forecasts. We expect to devote capital resources to continue our product
development, expand manufacturing capacity and continue research and development
activities. We will examine other growth opportunities, including strategic
alliances, and we expect any such activities will be funded from existing cash
and cash equivalents, as well as issuance of additional equity or additional
borrowings, subject to market and other conditions.





We
believe that our existing cash balances will be sufficient to fund current
operations, but any additional growth of the company will require additional
cash infusions. Thus, we may not be required to sell additional equity or obtain
additional credit facilities in the near term.. We may face expenses or other
circumstances such that we will have additional financing requirements. In such
event, the amount of additional capital we may need to raise will depend on a
number of factors. These factors primarily include the extent to which we can
achieve revenue growth, the profitability of such revenues, operating expenses,
research and development expenses, and capital expenditures. Given the number of
product development programs that we have ongoing and not complete, it is not
possible to predict the extent or cost of these additional financing
requirements.





Notwithstanding
the numerous factors that our cash requirements depend on, and the uncertainties
associated with each of the major revenue opportunities that we have, we believe
that our plan of operation can build long-term value if we are able to
demonstrate clear progress toward our objectives. We expect to launch a series
of new product lines within the next 6 months in the Canadian, United States,
Korean and Japanese markets. Our relationship with Someo International will
allow immediate growth in the Asian markets and we believe that this will
represent significant value. We believe that our international sales efforts
will succeed based upon the market need, the performance of our products, our
competitive pricing, the distribution and marketing channels we are pursuing,
and the quality of our professional staff.





Progress
in our contract development and manufacturing initiatives and new research and
development will also likely lend credibility to our plan to become profitable.
We anticipate that we will hire several new members to our sales, marketing,
research and development, regulatory and administrative staff during the course
of 2005 in order to fully implement our plans for growth.





This
Company does not anticipate any contingency upon which it would voluntarily
cease filing reports with the SEC, even though it may cease to be required to do
so. It is in the compelling interest of this Registrant to report its affairs
quarterly, annually and currently, as the case may be, generally to provide
accessible public information to interested parties, and also specifically to
maintain its qualification for the OTCBB.





**Liquidity
and Capital Resources** .





At
December 31, 2004, we had $12,269 in cash and total current assets of $91,641.
Our current liabilities are $360,564 at December 31, 2004 (of which $175,687 in
convertible debt has been repaid by conversion into shares in January, 2005). As
of the date of this report, we do not require additional capital investments or
borrowed funds to meet cash flow projections and carry forward our business
objectives with respect to current operations. If we require additional capital
investments or borrowed funds to meet cash flow projections and carry forward
our future business objectives, there can be no assurance that we will be able
to raise capital from outside sources in sufficient amounts to fund our
business.





The
failure to secure adequate outside funding would have an adverse affect on our
expansion plan of operation and results therefrom and a corresponding negative
impact on shareholder liquidity.





**Going
Concern**





The
accompanying financial statements have been prepared in conformity with
generally accepted accounting principles, which contemplate continuation of the
Company as a going concern. Our limited operating history and our recent
concerns pertaining to profitability has raised substantial doubt about our
ability to continue as a going concern.





In spite
of the fact that the current obligations of the Company are relatively minimal,
given the cash position of the Company, we have very little cash to expand
operations.





If
necessary and plausible, we intend to fund the Company and attempt to meet
corporate obligations by selling common stock.





We face
exposure to fluctuations in the price of our common stock due to the limited
cash resources we have. For example, the Company has very limited resources to
pay legal and accounting professionals on a going forward basis and upon the
expiration of any present agreements, if any, with any such professionals under
which payment has already been tendered. If we are unable to pay a legal or
accounting professional in order to perform various professional services for
the company, it may be difficult, if not impossible, for the Company to maintain
its reporting status under the Securities Exchange Act of 1934. If the Company
felt that it was likely that it would not be able to maintain its reporting
status, it would make a disclosure by filing a Form 8-K with the SEC. In any
case, if the Company was not able to maintain its reporting status, it would
become "delisted" and this would potentially cause an investor or an existing
shareholder to lose all or part of his investment.

















**VITASTI,
      INC.**
      (Formerly
      Global Golf Holdings, Inc.)
      
      
      CONSOLIDATED
      FINANCIAL REPORT
      
      
      DECEMBER
      31, 2004
 
  
  
 
 
 
 
 
 
 
 
 
 
 
 **C
O N T E N T S**
 
 
 
 **Page**
 **REPORT
OF INDEPENDENT REGISTERED PUBLIC**
  **ACCOUNTING
FIRM** **and 2**
  **FINANCIAL
STATEMENTS**
   CONSOLIDATED
BALANCE SHEET
  CONSOLIDATED
STATEMENTS OF OPERATIONS
  CONSOLIDATED
STATEMENTS OF COMPREHENSIVE INCOME
  CONSOLIDATED
STATEMENTS OF STOCKHOLDERS' DEFICIT
  CONSOLIDATED
STATEMENTS OF CASH FLOWS
  NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS -
17
 
 
   
 
 
 
 **REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**
 
 
 
 To the
Board of Directors
 Vitasti,
Inc.
 Vancouver,
BC
 Canada
 
 
 
 We have
audited the accompanying consolidated balance sheet of Vitasti, Inc. and
Subsidiary (formerly Global Golf Holdings, Inc.) as of December 31, 2004,
and the related consolidated statements of operations, comprehensive income,
stockholders' deficit, and cash flows for the seven-month period ended December
31, 2004, and the year ended May 31, 2004. These consolidated financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
 
 We
conducted our audits in accordance with auditing standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. The Company has determined that it
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
audits provide a reasonable basis for our opinion.
 
 In our
opinion, the consolidated financial statements referred to above present fairly,
in all material respects, the financial position of Vitasti, Inc. and Subsidiary
(formerly Global Golf Holdings, Inc.) as of December 31, 2004, and the results
of their operations and their cash flows for the seven-month period ended
December 31, 2004 and the year ended May 31, 2004, in conformity with
accounting principles generally accepted in the United States.
 
  
  The
accompanying financial statements have been prepared assuming the Company will
continue as a going concern. As discussed in Note 1 to the financial statements,
the Company has not generated positive cash flows from operations and has an
accumulated deficit at December 31, 2004. These conditions raise substantial
doubt about the Company's ability to continue as a going concern. Management's
plan regarding those matters is also described in Note 1. The consolidated
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.
 
 
 
 
 April 11,
2005
 Seattle,
Washington
 
 
   
   **VITASTI,
INC.**
 (Formerly
Global Golf Holdings, Inc.)
  CONSOLIDATED
BALANCE SHEET
  December
31, 2004
 ASSETSCurrent
      AssetsCash
    
    $
      12,269Accounts
      receivable
    2,315Receivable
      for debt subscriptions
    18,000Assets
      of discontinued operation held for sale
    23,058Inventory
    24,642Prepaid
      expenses
    11,357Total
      current assets
    91,641Property
      and Equipment, net
    81,994Intangible
      asset
    70,672$
      244,307LIABILITIES
      AND STOCKHOLDERS' DEFICITCurrent
      LiabilitiesBank
      overdraft
    $
      5,387Accounts
      payable
    113,739Due
      to stockholders for shares cancelled
    39,244Demand
      loan payable
    26,507Convertible
      promissory notes, net of discount
    175,687Total
      current liabilities
    360,564Stockholders'
      DeficitPreferred
      stock, $0.0001 par value, 5 million sharesauthorized,
      no shares issued or outstandingCommon
      stock, $0.0000029 par value, 30 million sharesauthorized,
      8,116,801 shares issued and outstanding
    23Common
      stock issuable, 14,743,199 shares
    43Additional
      paid-in capital
    6,100,937Accumulated
      deficit
    (6,425,851)Accumulated
      other comprehensive income
    208,591Total
      stockholders' deficit
    (116,257)$
      244,307
 
   See Notes
to Consolidated Financial Statements
   **VITASTI,
INC.**
 (Formerly
Global Golf Holdings, Inc.)
  CONSOLIDATED
STATEMENTS OF OPERATIONS
  For the
Seven Months Ended December 31, 2004 and the Year Ended May 31,
2004
 Seven
      MonthsEnded
    
    Year
      EndedDecember
      31,
    
    May
      31,2004
    
    2004Sales
    
    
    $
      67,414
    
    $ -Cost
      of sales
    31,705Gross
      profit
    35,709
    
    -Operating
      expensesGeneral
      and administrative
    1,890,647Bad
      debt expense
    41,343Impairment
      of leasehold improvements
    47,852Total
      operating expenses
    1,979,842
    
    -Loss
      from continuing operations
    (1,944,133)
    
    -Discontinued
      OperationsLoss
      from operations of discontinued segment
    (501,843)
    
    (1,578,390)Net
      loss
    $(2,445,976)
    
    $(1,578,390)Net
      loss per common share (basic and fully-diluted)Continuing
      operations
    $
      (0.51)
    
    $ -Discontinued
      operations
    (0.13)
    
    (4.06)Net
      loss per common share
    $
      (0.64)
    
    $
      (4.06)Weighted
      average number of common shares outstanding
    3,794,745
    
    388,788
  See Notes
to Consolidated Financial Statements
  **VITASTI,
INC.**
 (Formerly
Global Golf Holdings, Inc.)
  CONSOLIDATED
STATEMENTS OF COMPREHENSIVE INCOME
  For the
Seven Months Ended December 31, 2004 and the Year Ended May 31,
2004
 Seven
      MonthsEnded
    
    Year
      EndedDecember
      31,
    
    May
      31,2004
    
    2004Net
      loss
    
    $(2,445,976)
    
    $(1,578,390)Other
      comprehensive income (loss)Foreign
      currency translation adjustment
    46,260
    
    (72,745)Comprehensive
      income (loss)
    $(2,399,716)
    
    $(1,651,135)
 
 
   See Notes
to Consolidated Financial Statements
   **VITASTI,
INC.**
 (Formerly
Global Golf Holdings, Inc.)
  CONSOLIDATED
STATEMENTS OF STOCKHOLDERS' DEFICIT
  For the
Seven Months Ended December 31, 2004 and the Year Ended May 31,
2004
 Common
      Stock
    
    Common
      Stock Issuable
    
    Preferred
      Stock
    
    Additional
      Paid-in
      Capital
    
    
    
    Accumulated
      Other Comprehensive IncomeNumber
      of
      Shares
    
    Amount
    
    Number
      of
      Shares
    
    Amount
    
    Number
      of
      Shares
    
    Amount
    
    
    Accumulated
      Deficit
    
    
    TotalBalance,
      May 31, 2003
    209,827
    
    $ 1
    
    
    
    $ -
    
    -
    
    $ -
    
    $
      2,347,044
    
    $
      (2,401,485)
    
    $
      235,076
    
    $
      180,636Common
      stock issued for:Cash
    
    63,235
    
    
    
    
    
    
    
    
    
    
    
    73,564
    
    
    
    
    
    73,564Services
      and expenses
    381,176
    
    1
    
    
    
    
    
    
    
    
    
    1,369,553
    
    
    
    
    
    1,369,554Debt
      settlement
    153,064
    
    
    
    
    
    
    
    
    
    
    
    217,733
    
    
    
    
    
    217,733Shares
      cancelled
    (26,471)
    
    
    
    
    
    
    
    
    
    
    
    (36,035)
    
    
    
    
    
    (36,035)Options
      granted for services
    
    
    
    
    
    
    
    
    
    
    
    135,683
    
    
    
    
    
    135,683Exercise
      of options
    12,735
    
    
    
    
    
    
    
    
    
    
    
    17,320
    
    
    
    
    
    17,320Net
      loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,578,390)
    
    
    
    (1,578,390)Translation
      adjustment
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (72,745)
    
    (72,745)Balance,
      May 31, 2004
    793,566
    
    2
    
    
    
    -
    
    
    
    -
    
    4,124,862
    
    (3,979,875)
    
    162,331
    
    307,320Common
      stock issued forservices
    7,323,235
    
    21
    
    
    
    
    
    
    
    
    
    1,842,927
    
    
    
    
    
    1,842,948Common
      stock issued foracquisition
      of business
    
    
    
    
    14,743,199
    
    43
    
    
    
    
    
    89,891
    
    
    
    
    
    89,934Issuance
      of warrants inconnection
      withconvertible
      debt
    
    
    
    
    
    
    
    
    
    
    
    
    43,257
    
    
    
    
    
    43,257Net
      loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,445,976)
    
    
    
    (2,445,976)Translation
      adjustment
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    46,260
    
    46,260Balance,
      December 31, 2004
    8,116,801
    
    $
      23
    
    14,743,199
    
    $
      43
    
    -
    
    $ -
    
    $
      6,100,937
    
    $
      (6,425,851)
    
    $
      208,591
    
    $
      (116,257)
 
   See Notes
to Consolidated Financial Statements
   **VITASTI,
INC.**
 (Formerly
Global Golf Holdings, Inc.)
  CONSOLIDATED
STATEMENTS OF CASH FLOWS
  For the
Seven Months Ended December 31, 2004 and the Year Ended May 31,
2004
 Seven
      MonthsEnded
    
    Year
      EndedDecember
      31,
    
    May
      31,2004
    
    2004Cash
      Flows From Operating ActivitiesNet
      loss
    $(2,445,976)
    
    $(1,578,390)Adjustment
      to reconcile net loss to net cash providedby
      (used in) continuing operating activitiesLoss
      from discontinued operations
    501,843
    
    1,578,390Depreciation
    2,381Amortization
    14,082Bad
      debt
    41,343Impairment
      of leasehold improvements
    47,852Issuance
      of common stock for services and expenses
    1,842,948Changes
      in operating assets and liabilities, net ofeffect
      from purchase of businessAccounts
      receivable
    4,729Inventory
    283Prepaid
      expenses
    5,387Bank
      overdraft
    4,101Accounts
      payable and accrued expenses
    46,899Net
      cash provided by (used in) continuingoperating
      activities
    65,872
    
    -Cash
      Flows From Investing ActivitiesPurchase
      of equipment
    (3,068)Purchase
      of subsidiaries, adjusted for cash acquired
    3,468Net
      cash provided by (used in) investing activities
    400
    
    -Cash
      Flows from Financing ActivitiesProceeds
      from demand loan
    8,322Net
      cash used in discontinued operation
    (66,386)
    
    26,384Foreign
      exchange effect on cash
    3,827
    
    (27,100)Net
      change in cash
    12,035
    
    (716)Cash
      at the beginning of the period
    234
    
    950Cash
      at the end of the period
    $
      12,269
    
    $
      234Cash
      paid for interest
    $ -
    
    $ -Cash
      paid for income taxes
    $ -
    
    $ -
 
   See Notes
to Consolidated Financial Statements
    **NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS** ****
  
 
 
 **Note
1. Summary of Significant Accounting Policies**
 
 **Business
Operations**
 
 Vitasti,
Inc. (formerly Global Golf Holdings, Inc.) (the "Company"), a Delaware
corporation, acquired a subsidiary on November 23, 2004 (see Note 2) and since
that date has adopted the subsidiaries' business plan which is to sell and
distribute low carbohydrate and sugar-free foods through retail and wholesale
outlets in Western British Columbia, Canada, and through the internet. The
Company had also been in the business of marketing, rental, and distribution of
golf merchandise until December 31, 2004, when management decided to discontinue
the golf line of business. Accordingly, for all periods presented, the golf
operations are presented as discontinued operations and the Company has one
operating business segment for financial reporting purposes effective as of
December 31, 2004.
 
 At
December 31, 2004, management elected to change its fiscal year end from May 31
to December 31. Accordingly, these consolidated financial statements present the
seven-month period from June 1, 2004 through December 31, 2004 and the year
ended May 31, 2004.
 
 **Going
Concern**
 
 The
Company has incurred losses from operations, has a working capital deficit and
has an accumulated deficit at December 31, 2004. The Company's ability to
continue as a going concern is dependent upon the Company's obtaining additional
financing and/or achieving a sustainable profitable level of operations. The
consolidated financial statements do not include any adjustments that might
result from the outcome of this uncertainty.
 
 Management
of the Company has undertaken steps as part of a plan with the goal of
sustaining Company operations for the next twelve months and beyond. These steps
include: (a) focusing on promoting and expanding the business plan of Low
Carb Centre, Inc. and related entities, (b) discontinuing the Company's
golf segment; (c) continuing efforts to raise additional capital and/or other
forms of financing; and (d) controlling overhead and expenses. There can be no
assurance that any of these efforts will be successful.
 
 **Discontinued
Operations**
 
 Management
decided to discontinue the golf segment in order to devote the Company's time
and resources to the business plan of the newly acquired subsidiaries. The
assets of the golf segment are currently being actively marketed and therefore
are classified as current assets, held for sale.
 
 During
the seven-month period ended December 31, 2004 and the year ended May 31, 2004,
operations from the golf business segment generated revenues of $10,360 and
$14,080, respectively.
 
  
  All of
the assets of the discontinued segment have been written down to net realizable
value. Accordingly, an impairment loss on intangible assets of $438,000 is
included in the loss from discontinued operations. Assets of the discontinued
operation held for sale at December 31, 2004, consist of golf equipment leased
to a golf course through May 2006. The lease provides monthly payments of
approximately $2,200 for eight months of the year.
 
 **Consolidation**
 
 The
accompanying consolidated financial statements include the accounts of Vitasti,
Inc. and its wholly-owned subsidiary, Golflogix. All intercompany accounts and
transactions have been eliminated.
 
 **Cash**
 
 Cash
consists of checking accounts held at financial institutions in the United
States and Canada.
 
 **Accounts
Receivable**
 
 Accounts
receivable consists of amounts due from customers located in Western Canada. The
Company considers accounts more than 30 days old to be past due. The
Company uses the allowance method for recognizing bad debts. When an account is
deemed uncollectible, it is written off against the allowance. The Company
generally does not require collateral for its accounts receivable. As of
December 31, 2004, management believes no allowance for uncollectible accounts
is necessary.
 
 **Inventory/Cost
of Sales**
 
 Inventory
consists of low carbohydrate foods and ingredients and is stated at the lower of
cost (first-in, first-out method) or market. Shipping and handling costs are
included with cost of sales.
 
 **Equipment**
 
 Equipment
is recorded at cost and is depreciated using the straight-line method over the
estimated useful lives of the related assets, ranging from three to seven years.
Maintenance and repairs are charged to expense as incurred. Significant renewals
and betterments are capitalized.
 
 **Intangible
Assets**
 
 Intangibles
consist of customer lists attributable to the acquisition of Low Carb Centre
(See Note 2). The customer lists have an indefinite useful life and are
tested annually for impairment. Management has determined that no impairment
write down is necessary at December 31, 2004.
 
  
  **Property
and Equipment**
 
 Property
and equipment is stated at cost. Depreciation is provided using accelerated
methods over the estimated useful lives of the assets. Equipment as of December
31, 2004 at the Company's various locations consist of:
 
 Leasehold
      improvements
    
    $65,689Furniture
      and equipment
    
    37,286Computer
      equipment
    
    5,902108,877Less:
      Accumulated depreciation
    
    (26,883)$81,994
 
 Subsequent
to year end, the Company closed one of its stores. Accordingly, leasehold
improvements at that store amounting to $47,852 have been considered impaired
and an impairment loss for that amount has been recorded as of December 31,
2004.
 
 **Foreign
Currency Translation**
 
 The
Company's reporting currency is the U.S. Dollar. The Company translates foreign
assets and liabilities of its Canadian subsidiaries at the rate of exchange at
the balance sheet date. Revenues and expenses are translated at the average rate
of exchange throughout the year. Gains or losses from these translations, if
significant, are reported as a separate component of other comprehensive income,
until all or a part of the investment in the subsidiary is sold or liquidated.
Translation adjustments do not recognize the effect of income tax because the
Company expects to reinvest the amounts indefinitely in operations.
 
 **Revenue
Recognition**
 
 Revenue
from products sold is recognized when the sale is made, the price is fixed and
determinable, and collectibility is probable.
 
 Revenue
from discontinued operations consisting of equipment rentals were reported on
the straight-line basis over the noncancelable lease term as it became
receivable according to the provisions of the lease.
 
 **Advertising
Expense**
 
 The cost
of advertising is expensed as incurred. The Company incurred $129 and $14,287 in
advertising costs during the seven-month period ended December 31, 2004 and the
year ended May 31, 2004, respectively.
 
  
  **Comprehensive
Income and Loss**
 
 The
Company has adopted Statement of Financial Accounting Standards ("SFAS")
No. 130, "Reporting Comprehensive Income." Other comprehensive gain and
loss, which currently includes only foreign currency translation adjustments, is
shown as a component of stockholders' deficit.
 
 **Earnings
Per Share**
 
 Basic
loss per share is computed by dividing the net loss available to common
shareholders by the weighted average number of common shares outstanding in the
period. Effective December 9, 2004, the Board of Directors approved a
1-for-34 reverse stock split. Presentation of shares issued and issuable and
outstanding, common stock amounts reported, and loss per share have been
restated to give affect to the reverse split for all periods presented. Diluted
earnings per share takes into consideration common shares outstanding (computed
under basic earnings per share) and potentially dilutive common shares. Common
stock issuable upon conversion of the Company's warrants, convertible debt, and
preferred stock were not included in the computation of diluted earnings per
share for all periods presented because they were anti-dilutive. Common stock
issuable is
considered outstanding as of the original approval date for purposes of earnings
per share computations.
 
 **Stock-Based
Compensation**
 
 The
Company accounts for stock-based compensation under the recognition and
measurement principles of Accounting Principles Board ("APB") Opinion
No. 25, "Accounting for Stock Issued to Employees," and related
interpretations. To the extent options are granted and those options have an
exercise price equal to or greater than the market value of the underlying
common stock on the date of grant, no stock-based employee compensation cost
will be recorded. Compensation cost for stock options granted to non-employees
is measured using the Black-Scholes valuation model at the date of grant
multiplied by the number of options granted. Since the Company has not issued
stock options to employees, there is no effect on net loss or loss per share had
the Company applied the fair value recognition provisions of SFAS No. 123,
"Accounting for Stock-Based Compensation," to stock-based employee compensation.
When the Company issues shares to employees and others, the shares are valued
based on the market price at the date the shares are approved for issuance.
 
 **Fair
Value of Financial Instruments**
 
 Financial
instruments consist of cash, accounts receivable, receivable for debt
subscriptions, accounts payable, and certain of the assets of the discontinued
operation. The fair value of these financial instruments approximates their
carrying amounts due to their short-term nature.
 
  
  **Income
Taxes**
 
 The
Company accounts for income taxes in accordance with the liability method. Under
the liability method, deferred assets and liabilities are recognized based upon
anticipated future tax consequences attributable to differences between
financial statement carrying amounts of assets and liabilities and their
respective tax bases. The Company establishes a valuation allowance to the
extent that it is more likely than not that deferred tax assets will not be
recoverable against future taxable income.
 
 **New
Accounting Standards**
 
 SFAS No.
151, "Inventory Costs," is effective for fiscal years beginning after June 15,
2005. This statement amends the guidance in Accounting Research Bulletin ("ARB")
No. 43, Chapter 4, Inventory Pricing, to clarify the accounting for
abnormal amounts of idle facility expense, freight, handling costs, and wasted
material (spoilage). The adoption of SFAS 151 is expected to have no impact
on the Company's financial statements.
 
 SFAS No. 152,
"Accounting for Real Estate Time-Sharing Transactions," is effective for fiscal
years beginning after June 15, 2005. This statement amends
SFAS No. 66, Accounting for Sales of Real Estate, to reference the
financial accounting and reporting guidance for real estate time-sharing
transactions that is provided in American Institute of Certified Public
Accountants Statement of Position 04-2, Accounting for Real Estate Time-Sharing
Transactions. The adoption of SFAS No. 152 is expected to have no
impact on the Company's financial statements.
 
 SFAS No. 123(R),
"Share-Based Payment," replaces SFAS No. 123, "Accounting for Stock-Based
Compensation," and supersedes APB Opinion No. 25, "Accounting for Stock
Issued to Employees." This statement requires that the compensation cost
relating to share-based payment transactions be recognized in the financial
statements. The Company is required to apply this statement in the first interim
period that begins after December 15, 2005. The adoption of
SFAS No. 123(R) is expected to have no impact on the Company's
financial statements.
 
 SFAS No. 153,
"Exchanges of Nonmonetary Assets" - an amendment of APB Opinion No. 29, is
effective for fiscal years beginning after June 15, 2005. This
statement addresses the measurement of exchange of nonmonetary assets and
eliminates the exception from fair-value measurement for nonmonetary exchanges
of similar productive assets in paragraph 21(b) of APB Opinion No. 29,
"Accounting for Nonmonetary Transactions," and replaces it with an exception for
exchanges that do not have commercial substance. The adoption of
SFAS No. 153 is expected to have no impact on the Company's financial
statements.
 
 FIN
No. 46(R) revised FIN No. 46, "Consolidation of Variable Interest
Entities," requiring the consolidation by a business of variable interest
entities in which it is the primary beneficiary. The adoption of FIN No. 46
did not have an impact on the Company's financial statements.
 
  
  The
Emerging Issues Task Force ("EITF") reached consensus on Issue No. 03-1,
"The Meaning of Other-Than-Temporary Impairment and Its Application to Certain
Investments" ("EITF 03-1") which provides guidance on determining when an
investment is considered impaired, whether that impairment is other than
temporary and the measurement of an impairment loss. The FASB issued FSP EITF
03-1-1, "Effective Date of Paragraphs 10-20 of EITF Issue No. 03-1, 'The
Meaning of Other-Than-Temporary Impairment and Its Applications to Certain
Investments'" ("FSP") which delays the effective date for the measurement and
recognition criteria contained in EITF 03-1 until final application
guidance is issued. The Company does not expect the adoption of this consensus
or FSP to have a material impact on its financial statements.
 
 The EITF
reached a consensus on Issue No. 04-8, "The Effect of Contingently Convertible
Debt on Diluted Earnings Per Share" ("EITF 04-8"), which addresses when the
dilutive effect of contingently convertible debt instruments should be included
in diluted earnings (loss) per share. EITF 04-8 is effective for reporting
periods ending after December 15, 2004. The adoption of EITF 04-8 did
not have an impact on diluted earnings (loss) per share.
 
 **Use
of Estimates**
 
 The
preparation of consolidated financial statements in conformity with accounting
principles generally accepted in the United States requires management to make
certain estimates and assumptions that directly affect the results of reported
assets and liabilities and disclosure of contingent assets and liabilities as of
the balance sheet date, and the reported amounts of revenues and expenses for
the periods presented. Actual results could differ from these
estimates.
 
 **Reclassification**
 
 Certain
May 31, 2004, amounts have been reclassified to conform to the current period
presentation.
 
 
 
 **Note
2. Acquisition of Business**
 
 On
November 23, 2004, the Company completed its acquisition of the assets of Low
Carb Centre, Inc., Low Carb Centre Bakery, Inc., and McNabb and Associates, Inc.
(collectively, "Low Carb Centre"). Resulting operations of the business formerly
operated by Low Carb Centre are included beginning as of that date. The
acquisition was made for the purpose of expanding the Company's operations. In
consideration, the Company issued 14,743,199 shares of the Company's common
stock to the shareholders of Low Carb Centre. In addition, the Company assumed
convertible promissory notes issued by Low Carb Centre in the amount of
$221,962. The purchase price amounted to $89,934, consisting of the fair value
of the shares issued at the effective date of the purchase.
 
  
  Following
is a summary of the assets acquired and liabilities assumed:
 
 Assets
      acquired:Current
      assets
    
    $108,512Property
      and equipment
    
    132,712Customer
      lists
    
    70,672Total
      assets acquired
    
    311,896Liabilities
      assumed:Convertible
      promissory notes
    
    221,962Purchase
      price
    
    $89,934
 
 These
amounts differ from those the Company reported in its quarterly financial
statements for the period ended November 30, 2004, because of subsequent
adjustments to the valuation of assets acquired.
 
 
 
 **Note
3. Convertible Promissory Notes**
 
 Prior to
the purchase of the assets of Low Carb Centre, Low Carb Centre issued 12%
Convertible Promissory Notes which, by agreement with the Company, became
convertible into Vitasti, Inc. shares after the closing of the purchase. The
notes are convertible at the rate of $0.125 per share. For those notes that were
Canadian-denominated, the share conversion was determined based on the exchange
rate on the date of the issuance of debt. The convertible debt also included
detachable warrants to purchase additional shares at a rate of one additional
share for each four shares convertible. The warrants are exercisable at $0.15
per share. Warrants to purchase a total of approximately 1,695,452 shares are
outstanding in connection with this debt as of November 30, 2004. The warrants
expire in three years from that date.
 
 Following
the closing of the purchase of the assets of Low Carb Centre, the recorded
proceeds from the issuance of the debt were allocated on a pro-rata basis
between the carrying amount of the notes and the amount attributable to the fair
value of the related detachable warrants. The amount attributable to the
warrants of $43,257 was recorded as a debt discount against the carrying value
of the debt and is being amortized as interest expense using the effective
interest method over the term of the debt.
 
 
 
 **Note
4. Stock-Based Compensation**
 
 **Stock
Options**
 
 In 2003,
the Company adopted a fixed stock option plan that provides for the issuance of
incentive and non-qualified stock options to officers, directors, employees and
non-employees to acquire up to 5,000,000 shares of the Company's common stock.
The Board of Directors determines the terms of the options granted, including
the number of options granted, the exercise price and the vesting schedule.
  
  **Stock
Options Issued to Employees**
 
 As
discussed in Note 1, the Company continues to account for its employee
stock-based awards using the intrinsic value method in accordance with
APB No. 25, "Accounting for Stock Issued to Employees", and its
related interpretations. Accordingly, no compensation expense will be recognized
in the financial statements for employee stock arrangements, if the fair value
of common stock at the measurement date is not greater than the option exercise
price.
 
 Proforma
information regarding net loss and earnings per share is required by SFAS
No. 123, and will be determined as if the Company had accounted for its
employee stock options under the fair value method of that statement. The fair
value for options will be estimated at the date of grant using a Black-Scholes
option pricing model.
 
 The
Black-Scholes option valuation model was developed for use in estimating the
fair value of traded options which have no vesting restrictions and are fully
transferable. In addition, option valuation models require the input of highly
subjective assumptions including the expected stock price volatility. Because
the Company's employee stock options have characteristics significantly
different from those of traded options, and because changes in the subjective
input assumptions can materially affect the fair value estimate, in management's
opinion, the existing models do not necessarily provide a reliable single
measure of the fair value of its employee stock options.
 
 **Stock
Options Issued to Non-Employees**
 
 On March
1, 2004 and March 5, 2004, respectively, the Company granted options to purchase
500,000 and 450,000 shares of the Company's common stock at a price of $.04 per
share to consultants of the Company. The options vested immediately and have no
expiration date. Stock options issued to non-employees are accounted for in
accordance with the provisions of SFAS No. 123, "Accounting for Stock
Based Compensation," using the fair value method. The fair value for these
options was estimated at the date of grant using a Black-Scholes option pricing
model with the following weighted-average assumptions: risk-free interest rate
of 4.5%; dividend yield of 0%; volatility factors of the expected market price
of the Company's stock of 130%; and an expected life of the options of
1 year.
 
  
  **Additional
Stock Option Plan Information**
 
 A summary
status of the Company's fixed stock option plan and changes during the
seven-month period ended December 31, 2004 and the year ended May 31, 2004, are
as follows:
 
 Number
      of
      Shares
    
    Weighted
      Average Exercise PriceOutstanding,
      May 31, 2003
    
    -Granted
    
    950,000
    
    $
      .04Exercised
    
    (433,000)
    
    .04Forfeited
    
    (67,000)
    
    .04Outstanding,
      May 31, 2004
    
    450,000
    
    .04GrantedExercisedForfeited
    
    (450,000)
    
    .04Options
      outstanding and exercisable at
      end
      of December 31, 2004
    
    -
 
 
 
 **Note
5. Income Taxes**
 
 The
difference between the statutory federal tax rate and the tax provision of zero
recorded by the Company is primarily due to the Company's full valuation
allowance against its deferred tax assets.
 
 Deferred
income taxes arise from the temporary differences between financial statement
and income tax recognition of net operating losses and asset impairment. Net
operating loss carryovers may be limited under the Internal Revenue Code should
a significant change in ownership occur.
 
 At
December 31, 2004, the Company had approximately $3,877,000 (expressed in U.S.
dollars at December 31, 2004) of unused Canadian net operating loss
carryforwards for Canadian income tax purposes, which begin to expire in the
year 2008. A deferred tax asset has been offset by a full valuation allowance.
The components of the Company's deferred tax assets and liabilities are as
follows:
 
 Deferred
      tax liability
    
    $-Deferred
      tax assets arising from:Net
      operating loss carryforwards
    
    1,318,000Asset
      impairment
    
    166,0001,484,000Valuation
      allowance
    
    (1,484,000)Net
      deferred taxes
    
    $-
 
  
  The
valuation allowance increased by $803,000 from May 31, 2004 to December 31, 2004
and by $386,500 from May 31, 2003 to May 31, 2004.
 
 The
Company's ability to utilize net operating loss carryforwards is limited
pursuant to the Tax Reform Act of 1986, due to cumulative changes in stock
ownership in excess of 50% such that some net operating losses may never be
utilized.
 
 
 
 **Note
6. Lease Commitments**
 
 In
connection with its purchase of the assets of Low Carb Centre, the Company
assumed an agreement to lease office space for a five-year term commencing
May 15, 2003, and an agreement to lease retail space for a three-year term
commencing January 1, 2004. The future minimum lease payments (contractually in
Canadian dollars, converted into U.S. dollars at the December 31, 2004, exchange
rate) under these agreements are as follows for the years ending December
31:
 
 2005
    
    $60,2002006
    
    64,0002007
    
    67,3002008
    
    16,600
 
 Rent
expense totaled approximately $6,100 for the period ended December 31, 2004.
There was no rent expense in the year ended May 31, 2004.
 
 
 
 **Note
7. Subsequent Events**
 
 Subsequent
to December 31, 2004, the Company issued 1,695,452 shares of common stock on
conversion of convertible debt that was outstanding as of December 31, 2004. The
Company also issued 610,000 shares for services.























**Item
7.**  **Financial
Statements**





The
Consolidated Financial Statements and schedules that constitute Item 7 are
attached at the end of this Annual Report on Form 10-KSB. An index to these
Financial Statements and schedules is also included on page F-1 of this Annual
Report on Form 10-KSB.


****


**Item
8. Changes In And Disagreements With Accountants On Accounting And Financial
Disclosure.**





Not
applicable.





**Item
8A. Controls & Procedures**





As of the
end of the period covered by this report, the Company conducted an evaluation
under the supervision and with the participation of the principal executive
officer and principal financial officer, of the Company’s disclosure controls
and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities
Exchange Act of 1934 (the “Exchange Act”)). Based on this evaluation, the
principal executive officer and principal financial officer concluded that the
Company’s disclosure controls and procedures are effective to ensure that
information required to be disclosed by the Company in reports that it files or
submits under the Exchange Act is recorded, processed, summarized and reported
within the time periods specified in Securities and Exchange Commission rules
and forms. There was no change in the Company’s internal controls over financial
reporting during the Company’s most recently completed fiscal quarter that has
materially affected, or is reasonably likely to materially affect, the Company’s
internal control over financial reporting.





**Item
8B. Other Information**





Not
applicable.



















**PART
III**


****


**Item
9. Directors, Executive Officers, Promoters And Control Persons; Compliance With
Section 16(A) Of The Exchange Act.**





**Directors
and Executive Officers**





**Tammy-Lynn
McNabb (36)**





By way of
educational background, Mrs. McNabb attended the British Columbia Institute of
Technology from 1987-1990.  While there, Mrs. McNabb was enrolled in the
Marketing Sales Management Program.





Presently,
Mrs. McNabb has over 15 years of experience in Marketing and Sales.  As
part of her experience, she was involved with Marketing for a large English
Publication company for 4 years in Tokyo, Japan.  While in Japan, she
capitalized on her stay by studying Japanese and earning a Level 4 Proficiency
Certification. Moreover, Mrs. McNabb has specialized in various start-up
companies, including high-tech and public relations firms.  During the tech
boom in the 1990’s, Mrs. McNabb worked in management for a very successful
start-up Internet Service Provider and used this experience to begin her journey
into entrepreneurship.





In June
1999, Mrs. McNabb began a public and investor relations firm tailored to serving
publicly traded companies.    Mrs. McNabb’s keen sense of the
public market has allowed tremendous success in both capital raising for under
funded companies and overall media exposure.





Ultimately,
Mrs. McNabb began another venture of her own, the Low-Carb Centre Inc. 
Low-Carb Centre was Canada’s first low carbohydrate retail wellness
centre.  Additional retail locations and a bakery specializing in this
market soon followed.  Mrs. McNabb is currently pursuing expansion on a
global level of various health and wellness products for the ever booming Health
Industry.  Recently, Mrs. McNabb was recognized for her efforts as an
Entrepreneur in the Culinary Industry by the Forum for Women
Entrepreneurs.





**Section
16(a) Beneficial Ownership Reporting Compliances**





Section
16(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”),
requires the Company’s directors, executive officers and holders of more than
10% of the Company’s common stock to file with the Securities and Exchange
Commission initial reports of ownership and reports of changes in ownership of
common stock and other equity securities of the Company. The Company believes
that during the year ended December 31, 2004, its officers, directors and
holders of more than 10% of the Company’s common stock complied with all Section
16(a) filing requirements. This disclosure is based on a review of the forms
submitted to the Company during, and with respect to, its fiscal year ended
December 31, 2004.





**Code
of Ethics**





The
Company currently does not have a Code of Ethics that applies to the Company’s
principal executive and financial officers. The Company plans to establish and
adopt a code of ethics in the second quarter of the current fiscal
year.





**Identification
of Audit Committee; Audit Committee Financial Expert**





The
Company currently does not have an audit committee and has not made a
determination of whether there is a financial expert. The Company does not
presently plan to establish an audit committee. However, if an audit committee
is established, the Registrant will make the proper disclosures on From
8-K.





**Item
10. Executive Compensation.**





The
following table sets forth certain summary information regarding compensation
paid by the Company for services rendered during the year ended December 31,
2004 and the fiscal year ended May 31, 2004, respectively, to the Company’s
Chief Executive Officer and President during such periods.





**Summary
Compensation Table**





Executive
Compensation:





**Name
      and Position**
    **Year**
    **Annual
      Comp Salary**
    **Long
      Term Compensation Awards—Securities Underlying Stock
      Options**Tammy-Lynn
      McNabb, President, CEO, CFO & Chairwoman of the Board
    2004
    $10,000*
    0Ford
      Sinclair, President, CEO, and Chairman of the Board
    2003-2004
    -
    -





*This
amount represents the period since the acquisition of the assets of LCC through
December 31, 2004.





There
were no stock options granted or exercised by the named executive directors in
2004.





**Employment
Agreements**





The
Registrant has no written employment agreements.





**Director
Compensation**





Ms.
McNabb has not received any compensation for her services to date, although the
Company and Ms. McNabb entered into a verbal agreement under which Ms. McNabb is
to receive $10,000 per month commencing in December, 2004. The Company has
adopted no retirement, pension, profit sharing or other similar programs.





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





The
following table sets forth certain information regarding the beneficial
ownership of the Company’s Common Stock as of the date of this report based on
information available to the Company by (i) each person who is known by the
Company to own more than 5% of the outstanding Common Stock based upon reports
filed by such persons within the Securities and Exchange Commission; (ii) each
of the Company’s directors; (iii) each of the Named Executive Officers; and (iv)
all officers and directors of the Company as a group.





**Name
      and Address**
    **Shares
      Beneficially Owned (1) (2)**
    **Percent
      of Class**Tammy-Lynn
      McNabb
    11,268,600
    45.26Jeanne
      & Kenny Chow
    2,000,000
    8.03Ford
      Sinclair
    2,220,589
    8.92Thunderbird
      Global Corporation
    1,725,000
    6.93Luis
      Carrillo
    1,275,000
    5.12**TOTAL**
    **18,489,189**
    **74.26**





(1)
    A
      person is deemed to be the beneficial owner of securities that can be
      acquired by such person within 60 days from the date of the registration
      statement upon the exercise of options or warrants. Each beneficial
      owner's percentage ownership is determined by assuming that options or
      warrants that are held by such person and which are exercisable within 60
      days of the date of this registration statement have been exercised.
      Unless otherwise indicated, the company believes that all persons named in
      the table have voting and investment power with respect to all shares of
      common stock beneficially owned by them.


(2)
    The
      shares referenced herein are as reflected in the records of the
      Registrant’s transfer agent on April 8,
2005.





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





None.





**Item
13. Exhibits and Reports on Form 8-K.**





(a)
Exhibits.





EXHIBIT
      NUMBER
    DESCRIPTION
    LOCATION3.1
      - 3.2
    Articles
      of Incorporation and Bylaws
    Incorporated
      by reference to Exhibits No. 3.1-3.2 to the Company’s Form 8-K filed on
      December 2, 200431.1
    CEO
      Certification
    Filed
      herewith31.2
    CFO
      Certification
    Filed
      herewith99.1
    CEO
      and CFO Certification
    Filed
      herewith








(b)
Reports on Form 8-K for the year ended December 31, 2004:





·
    On
      December 2, 2004, we filed a Form 8-K announcing that the LCC Transaction
      had closed, announcing the election of Tammy-Lynn McNabb as CEO, President
      and Director, announcing the filing of an Amended and Restated Certificate
      of Incorporation, Amended Bylaws and a reverse stock
  split.





·
    On
      October 14, 2004, we filed a Form 8-K advising of the execution of the LCC
      Transaction and transactions related
thereto.





·
    On
      April 15, 2004, we filed a Form 8-K advising that the current business of
      the Company was no longer viable and that the Company had retained the
      services of Business Consulting Group Unlimited, Inc., in order to assist
      the Company in the development of a new strategic focus and resolution of
      debt incurred by the Company.








**Item
14. Principal Accountant Fees And Services.**





**Audit
Fees** .





During
the seven months ended December 31, 2004, the aggregate fees billed or estimated
to be billed to us for professional services rendered by Peterson Sullivan,
PLLC, for the audit of our annual financial statements, review of financial
statements included in our quarterly reports or services normally provided by
our accountants in connection with statutory and regulatory filings or
engagements were $22,210.





**Audit-Related
Fees** .





During
fiscal 2004 and fiscal 2003, there were no fees billed to us for any other
products or services provided by Peterson Sullivan, PLLC, other than the
services reported above.




**Tax
Fees** .





During
fiscal 2004 and fiscal 2003, there were no fees billed to us for any other
products or services provided by Peterson Sullivan, PLLC, other than the
services reported above.





**All
Other Fees** .





During
fiscal 2004 and fiscal 2003, there were no fees billed to us for any other
products or services provided by Peterson Sullivan, PLLC, other than the
services reported above.





**Pre-Approval
Policies and Procedures** .





The Board
of Directors is responsible for appointing, setting compensation, and overseeing
the work of the independent auditor. The Board has no established policy
regarding pre-approval of any audit or permissible non-audit services provided
by the independent auditor.





**Audit
Committee and Other Committees** .





As of
December 31, 2004 our board of directors had not established an audit committee.
We recognize that an audit committee, when established, will play a critical
role in our financial reporting system by overseeing and monitoring management's
and the independent auditors' participation in the financial reporting process.





Until
such time as an audit committee has been established, the board of directors
will continue to undertake those tasks normally associated with an audit
committee to include, but not by way of limitation, the (i) review and
discussion of the audited financial statements with management, and (ii)
discussions with the independent auditors the matters required to be discussed
by the Statement On Auditing Standards No. 61, as may be modified or
supplemented.











**Vitasti,
Inc.**





**SIGNATURES** ****





Pursuant
to the requirements 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.








DATE:
      April 15, 2005
    VITASTI,
      INC.
      (Registrant)
      
      
      
      By:
      /s/ Tammy-Lynn McNabbTammy-Lynn
      McNabb
      Director,
      CEO and CFO