UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


Washington,
D.C. 20549





FORM
10-K





ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE


SECURITIES
EXCHANGE ACT OF 1934





For the
Fiscal Year Ended: June 30,
2009





Commission
File Number: 333-153472





Celestial
      Delights USA Corp.
                  (Exact
      name of registrant as specified in its charter)Nevada
                  (State
      of incorporation)
                
                27-0999493
                  (I.R.S.
      Employer Identification No.)11811
      N Tatum Blvd., Suite 3031
                  Phoenix, Arizona 85028
                  (Address
      of principal executive offices) (Zip Code)(602) 953-7757
                  (Registrant’s
      telephone number, including area
code)





Securities
registered pursuant to Section 12(b) of the Act:


None
            
            None(Title
      of each class)
            
            (Name
      of each exchange on which
registered)





Securities
registered pursuant to Section 12(g) of the Act:


Common
Stock, $0.00001 par value


(Title 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 xNo





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 xNo





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 twelve 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.


xYes  ̈No





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





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” and “small
reporting company” in Rule 12b-2 of the Exchange Act.





Large
accelerated filer  ̈   Accelerated
filer  ̈   Non-accelerated
filer*  ̈   Smaller
reporting company x


*(Do not
check if a smaller reporting company)





Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act)


x    Yes               ̈   No


The
aggregate market value of the common stock held by non-affiliates as of December
31, 2008 (the last trading day of the second quarter) was $4,140 based on the
closing sale price on such day.


As of
October 13, 2009, the last practicable date, 89,120,000 shares of the
registrant’s Common Stock were outstanding.





DOCUMENTS
INCORPORATED BY REFERENCE: Exhibits incorporated by reference are referred to
under Part IV.







TABLE
OF CONTENTS




Page NumberPart
      IITEM
      1.
                                                                            Business
                                                                            2ITEM
      1A.
                                                                            Risk
      Factors
                                                                            5ITEM 1B.
                                                                            Unresolved
      Staff Comments
                                                                            8ITEM
      2.
                                                                            Properties
                                                                            8ITEM
      3.
                                                                            Legal
      Proceedings
                                                                            8ITEM
      4.
                                                                            Submission
      of Matters to a Vote of Security Holders
                                                                            8Part
      IIITEM
      5.
                                                                            Market
      for the Registrant’s Common Equity, Related Stockholder Matters and Issuer
      Purchases of Equity
                                                                            8ITEM
      6.
                                                                            Selected
      Financial Data
                                                                            9ITEM
      7.
                                                                            Management’s
      Discussion and Analysis of Financial Condition and Results of
      Operations
                                                                            9ITEM
      7A.
                                                                            Quantitative
      and Qualitative Disclosures about Market Risk
                                                                            12ITEM
      8.
                                                                            Financial
      Statements and Supplementary Data
                                                                            12ITEM
      9.
                                                                            Changes
      in and Disagreements with Accountants on Accounting and Financial
      Disclosure
                                                                            12ITEM 9A.
                                                                            Controls
      and Procedures
                                                                            12ITEM
      9B.
                                                                            Other
      Information
                                                                            13Part
      IIIITEM
      10.
                                                                            Directors,
      Executive Officers and Corporate Governance
                                                                            13ITEM
      11.
                                                                            Executive
      Compensation
                                                                            14ITEM
      12.
                                                                            Security
      Ownership of Certain Beneficial Owners and Management and
      Related  Stockholder Matters
                                                                            15ITEM
      13.
                                                                            Certain
      Relationships and Related Transactions, and Director
      Independence
                                                                            16ITEM
      14.
                                                                            Principal
      Accounting Fees and Services
                                                                            17Part
      IVITEM
      15.
                                                                            Exhibits
      and Financial Statement Schedules
                                                                            18Signatures
                                                                            19


1





PART
I.





ITEM
1. BUSINESS





Overview





Celestial
Delights USA Corp. (“we”, “us”, “our” or the “Company”) was organized under the
laws of the State of Nevada on June 2, 2008. Under an exclusive Product License
Agreement (“Agreement”) with our former president, Neema Lakhani, and Celestial
Delights, a sole proprietorship company located in the Canadian province of
Ontario, we have the exclusive right to market and distribute the coveted
Celestial Delights product line in the United States.  The Celestial
Delights product line consists of gourmet infused oils, infused grapeseed oils,
mustard sauces, grilling rubs, bread dippers and gourmet dips for sale to
specialty retail stores and gift basket markets. Our president owns the
proprietary rights to those products. The recipes are original and are a trade
secret.





Currently,
the “Celestial Delights” product line, which we have an exclusive license to
sell in the United States, can be found in various retail and gift basket
markets in the Canadian provinces of Quebec and Ontario (Central, Western,
Eastern, and Northern). Specifically, the Celestial Delights product line can be
found in 30 stores in Central Ontario, in 6 stores in both Western and Eastern
Ontario, in 5 stores in Northern Ontario, and in 5 stores in the Canadian
province of Quebec.  We have the right to sell the product line in the
United States and intend to market the product and make it available for
purchase via our website (http://www.celestialdelightsusa.com).





We
currently market premium quality gourmet oils, mustard sauces, rubs, and
dippers, emphasizing superior flavors and innovative products. We seek to build
brand recognition and customer loyalty by employing a marketing program that
focuses on developing multiple points of sale for our products, and increasing
consumer awareness of our offerings primarily through in-store sampling and web
advertising in conjunction with our customers.





On June
9, 2009, the Company effectuated an 8 for 1 forward stock split, thereby
increasing the issued and outstanding shares of common stock from 11,140,000
shares to 89,120,000 shares.  This Form 10-K has been retroactively
adjusted to reflect this forward stock split.





Market
and Industry Overview and Size





According
to a report by the National Association of the Specialty Food Trade, the
specialty food industry generated $48 billion in sales at the retail level in
2008, which was an 8.4% increase over 2007.  The Gourmet food consumer
market, which Celestial Delight’s product lines is a part of, is an increasingly
growing part of the specialty food industry.




A review
of industry trends suggests the following conclusions:




·
            U.S.
      retail sales of gourmet, specialty and premium foods and beverages are
      growing at much faster rates than sales of the overall food and beverage
      industry.




·
            Americans
      have a growing interest in specially-made gourmet flavored foods. They
      associate high-quality ingredients with health and wellness, and “gourmet”
      with “natural/organic.” The supermarket industry’s focus on upscale “fresh
      formats” responds to the phenomenon of higher disposable incomes among
      U.S. consumers and the resulting perception that gourmet/premium products
      are affordable luxuries.




·
            Value
      and convenience are winning in the marketplace as evidenced by continued
      store growth in Club stores and discount
  supercenters.




·
            Boutique
      retail stores (Whole Foods, Trader Joe’s, etc.) grew over 50% between 2001
      and 2008. Natural foods have grown at a slower rate than organic products,
      but generate nearly five times the dollar
sales.




We
believe that our brands and our products are well suited for today’s consumer.
However, we can give no assurance that current trends in healthy gourmet eating
or consumer spending levels in the specialty food category will continue in the
future or that our products will continue to respond to or anticipate these
trends. Additionally, as we expand into different geographic regions and new
product categories, we may encounter different consumer perceptions, diet
trends, attitudes, behavior and competition. This may adversely impact our
expansion strategy and cause us to incur greater expenses than anticipated in
the promotion of our products.





Products
and Markets





The
Celestial Delights product line can be found in various retail and gift basket
markets in the Canadian provinces of Quebec and Ontario. Specifically, they are
sold in 30 stores in Central Ontario, in 6 stores in both Western and Eastern
Ontario, in 5 stores in Northern Ontario, and in 5 stores in the Canadian
province of Quebec.  Our company intends to sell the same Celestial
Delights product line in the United States.


2





In
particular the products are:





Gourmet
Infused Oils


Infused
Grapeseed Oils


Mustard
Sauces


Grilling
Rubs


Bread
Dippers


Gourmet
Dips





Additionally,
we intend to market and sell a product line of Vinegars, Seasoning Salts,
Antipasto, Chutneys, Cookie/Brownie Mixes, and Apple Butters.





The
Celestial Delights product line offers a variety of tasteful gourmet-flavored
foods. For example, the Gourmet infused oils add a unique yet subtle distinctive
flavour to any garden salad or sautéed dish. Infused Grapeseed oil is a choice
of many gourmet chefs around the world and is recognized as a heart healthy
cooking oil. It is high in antioxidants and Vitamin E, and has about half
the saturated fat of olive oil and has been known to raise HDL and LDL
cholesterols. Our mustard sauces compliment a variety of dishes, are made
with the finest natural ingredients, with No Preservatives and Gluten Free.
Grilling Rubs are a unique blend of spices and herbs which add to and compliment
the flavours of grilled and roasted meats, seafood and vegetables. Bread Dippers
are an Award winning product at the Canadian Fine Food Show, and is a unique
blend of canola oil, balsamic vinegar, herbs and spices. Finally, our Gourmet
Dips are great to serve anytime of the year with vegetables, chips, pretzels and
much more. They contain no fillers, MSG, artificial colours and are gluten
free.





The
products are labeled and carry the trade name “Celestial
Delights”.





Manufacturing
and Distribution





Ms.
Lakhani, individually, is responsible for the products being produced and
packaged. We distribute the products we sell by direct shipment from her
facilities in Whitby, Ontario.





Our goal
is to develop and create a shopping cart on our website to promote and sell the
Celestial Delights product line. We expect to have our website include a search
engine and a word search program with Google to generate more traffic to our
site.





Competition





The
specialty food industry, and more specifically, the gourmet food consumer
market, is intensely competitive. We expect competition to continue to intensify
in the future. There can be no assurance that we can maintain a competitive
position against current or future competitors, particularly those with greater
financial, marketing, service, and support, technical and other resources. Our
failure to maintain a competitive position within the market could have a
material adverse effect on our business, financial condition and results of
operations. There can be no assurance that we will be able to compete
successfully against current and future competitors, and competitive pressures
faced by us may have a material adverse effect on our business, financial
condition and results of operations.





Marketing





We plan
to market our business and its online presence by attending some key food trade
shows.  Further, we plan on targeting existing markets by aligning
ourselves with food distribution companies where the Celestial Delights product
line can be complimentary.  Our marketing strategy is to create and
sell unique quality products in the categories in which we compete.





We will
focus our marketing and advertising on promoting our website and the Celestial
Delights product line. The advertising campaign may also include the design and
printing of various sales materials. We intend to market our website through
traditional sources such as advertising in magazines, billboards, telephone
directories and preparing and sending out flyers and mailers both through the
regular mail and via email.





Patents,
Trademarks and Copyrights





We do not
own any patents, trademarks or copyrights. We do not know if we are or will be
infringing on any patents, copyrights or trademarks. If we infringe on any
patents, trademarks or copyrights we will be liable for damages and may be
enjoined from conducting our proposed business. Further, because we have no
patent or copyright covering our product, someone could use the information and
compete with us and we will have no recourse against him.


3





Licenses
and Distribution Rights





On July
2, 2008, we (the “Licensee”) entered into a Product License Agreement
(“Agreement”) with Celestial Delights, a sole proprietorship company located in
Ontario, Canada, and Neema Lakhani, our former president and majority
shareholder of our Company (the “Principal” and together with Celestial
Delights, the “Licensor”) pursuant to which the Company agreed to license the
exclusive rights to market and distribute, in the United States, a line of
gourmet seasonings owned by the Licensor. The initial term of the Agreement is
for two years, and is renewable at the sole option of the Licensor for two
additional two-year terms upon 30 days written notice. The Agreement may be
further extended upon mutual agreement by both parties. We may not alter or
modify the packaging used for the products except to comply with state and
federal laws. In all published versions of the products, we are required to
place a copyright notice showing that the owner of the products is Ms. Lakhani.
We have the right to promote and market the products in a manner determined by
us within the United States of America. Any and all promotional materials
developed by us will be the sole property of Ms. Lakhani.





The
Company is to pay $8,000 for the right to market, promote and distribute the
gourmet seasonings, and is to pay a royalty of ten percent (10%) of all gross
sales for products licensed. Ms. Lakhani is the majority stockholder and the
former chief executive officer of the Company. The $8,000 initial license fee,
which was paid on October 31, 2008, was capitalized on July 2, 2008 and is being
expensed over the initial two year term of the agreement.





Our
license may be terminated by us or by Ms. Lakhani upon 120 days notice in
writing.





Government
Regulation





We are
not currently subject to direct federal, state or local regulation other than
regulations applicable to businesses generally or directly applicable to
electronic commerce. However, the Internet is increasingly popular. As a result,
it is possible that a number of laws and regulations may be adopted with respect
to the Internet. These laws may cover issues such as user privacy, freedom of
expression, pricing, content and quality of products and services, taxation,
advertising, intellectual property rights and information security. Furthermore,
the growth of electronic commerce may prompt calls for more stringent consumer
protection laws. Several states have proposed legislation to limit the uses of
personal user information gathered online or require online services to
establish privacy policies. The Federal Trade Commission has also initiated
action against at least one online service regarding the manner in which
personal information is collected from users and provided to third parties. We
will not provide personal information regarding our users to third parties.
However, the adoption of such consumer protection laws could create uncertainty
in Web usage and reduce the demand for our products.





We are
not certain how business may be affected by the application of existing laws
governing issues such as property ownership, copyrights, encryption and other
intellectual property issues, and import and export matters. The vast majority
of such laws were adopted prior to the advent of the Internet. As a result, they
do not contemplate or address the unique issues of the Internet and related
technologies. Changes in laws intended to address such issues could create
uncertainty in the Internet market place. Such uncertainty could reduce demand
for services or increase the cost of doing business as a result of litigation
costs or increased service delivery costs. In addition, because our services are
available over the Internet in multiple states and foreign countries, other
jurisdictions may claim that we are required to qualify to do business in each
such state or foreign country. We are qualified to do business only in Nevada.
Our failure to qualify in a jurisdiction where it is required to do so could
subject it to taxes and penalties. It could also hamper our ability to enforce
contracts in such jurisdictions. The application of laws or regulations from
jurisdictions whose laws currently apply to our business could have a material
adverse affect on our business, results of operations and financial
condition.





Employees





We are a
development stage company and as of June 30, 2009, we had no employees, other
than our sole officer and director. We intend to hire additional employees on an
as needed basis.





Customers





As of
June 30, 2009, we had no customers.





Insurance





We do not
maintain any insurance and do not intend to maintain insurance in the future.
Because we do not have any insurance, if we are made a party of a products
liability action, we may not have sufficient funds to defend the litigation. If
that occurs a judgment could be rendered against us, which could cause us to
cease operations.


4


ITEM
1A.  RISK
FACTORS





An
investment in Celestial Delights USA’s common stock is subject to risks inherent
to our business.  The material risks and uncertainties that management
believes affect us are described below.  Before making an investment
decision, you should carefully consider the risks and uncertainties described
below together with all of the other information included or incorporated by
reference in this report.  The risks and uncertainties described below
are not the only ones facing Celestial Delights USA.  Additional risks
and uncertainties that management is not aware of or focused on or that
management currently deems immaterial may also impair Celestial Delights USA’s
business operations.  This report is qualified in its entirety by
these risk factors.





If any of
the following risks actually occur, our financial condition and results of
operations could be materially and adversely affected.  If this were
to happen, the value of our common stock could decline significantly, and you
could lose all or part of your investment.





With the exception of historical
facts stated herein, the matters discussed in this report on Form
10-K are “forward looking” statements that  involve risks and
uncertainties that could cause actual results to differ  materially from projected results.
Such “forward looking” statements include,  but are not necessarily
limited to statements regarding anticipated levels of  future revenues and
earnings from the operations of Celestial Delights USA. and its subsidiaries,
(the “Company,” “we,” “us” or “our”), projected costs and expenses related to
our operations, liquidity,  capital resources, and
availability of future equity capital on commercially  reasonable terms. Factors that
could cause actual results to differ materially  are discussed below. We
disclaim any intent or obligation to publicly update  these “forward looking”
statements, whether as a result of new information,  future events or
otherwise.





Our
limited operating history may not serve as an adequate basis to judge our future
prospects and results of operations.





We have a
limited operating history. As such, our historical operating results may not
provide a meaningful basis for evaluating our business, financial performance
and prospects. Accordingly, you should not rely on our results of operations for
any prior periods as an indication of our future performance. Our operations
will be subject to all the risks inherent in the establishment of a developing
enterprise and the uncertainties arising from the absence of a significant
operating history.  We are in the development stage and potential
investors should be aware of the difficulties normally encountered by
enterprises in the development stage. If our business plan is not successful,
and we are not able to operate profitably, investors may lose some or all of
their investment in our company.





We
have incurred losses in prior periods and may incur losses in the
future.





We
incurred net losses of $60,067 for the period from June 2, 2008 (inception) to
June 30, 2009. We cannot be assured that we can achieve or sustain profitability
on a quarterly or annual basis in the future. Our operations are subject to the
risks and competition inherent in the establishment of a business enterprise.
There can be no assurance that future operations will be profitable. We may not
achieve our business objectives and the failure to achieve such goals would have
an adverse impact on us.





If we are unable to obtain additional
funding our business operations will be harmed and if we do obtain additional
financing our then existing shareholders may suffer substantial
dilution.





We will
require additional funds to meet our business objectives, and to take advantage
of any available business opportunities.  In order to meet our
obligations, we will have to raise additional funds. Obtaining additional
financing will be subject to market conditions, industry trends, investor
sentiment and investor acceptance of our business plan and management. These
factors may make the timing, amount, terms and conditions of additional
financing unattractive or unavailable to us. If we are not successful in
achieving financing in the amount necessary to further our operations,
implementation of our business plan may fail or be delayed.





If
we are unable to successfully recruit qualified managerial and experienced
personnel, we may not be able to execute on our business plan.





In order
to successfully implement and manage our business plan, we will be dependent
upon, among other things, successfully recruiting qualified managerial and
experienced personnel. Competition for qualified individuals is intense. There
can be no assurance that we will be able to find, attract and retain existing
employees or that we will be able to find, attract and retain qualified
personnel on acceptable terms.


5





We
are subject to new corporate governance and internal control reporting
requirements, and our costs related to compliance with, or our failure to comply
with existing and future requirements, could adversely affect our
business.





We may
face new corporate governance requirements under the Sarbanes-Oxley Act of 2002,
as well as new rules and regulations subsequently adopted by the SEC and the
Public Company Accounting Oversight Board. These laws, rules and regulations
continue to evolve and may become increasingly stringent in the future. In
particular, under rules proposed by the SEC on August 6, 2006 we are required to
include management's report on internal controls as part of our annual report
pursuant to Section 404 of the Sarbanes-Oxley Act. Furthermore, under the
proposed rules, an attestation report on our internal controls from our
independent registered public accounting firm will be required as part of our
annual report for the fiscal year ending June 30, 2010. We strive to
continuously evaluate and improve our control structure to help ensure that we
comply with Section 404 of the Sarbanes-Oxley Act. The financial cost of
compliance with these laws, rules and regulations is expected to remain
substantial. We cannot assure you that we will be able to fully comply with
these laws, rules and regulations that address corporate governance, internal
control reporting and similar matters. Failure to comply with these laws, rules
and regulations could materially adversely affect our reputation, financial
condition and the value of our securities.





If
the Celestial Delights product line does not achieve greater market acceptance,
or if alternative brands are developed and gain market traction, prospects for
our growth and profitability would be limited.





Our
future success depends on increased market acceptable of the Celestial Delights
product line.  The gourmet specialty food community may not embrace
our Celestial Delights product line.  Acceptance of our services will
depend on several factors, including: cost, product freshness, convenience,
timeliness, strategic partnerships and reliability. Any of these factors could
have a material adverse effect on our business, results of operations and
financial condition. We also cannot be sure that our business model will gain
wide acceptance among chefs, or the gourmet specialty food community. If the
market fails to continue to develop, or develops more slowly than we expect, our
business, results of operations and financial condition will be adversely
affected. Moreover, if new gourmet brands are developed, our prospective
products and current technologies could become less competitive or
obsolete.  Any of these factors could have a material and adverse
impact on our growth and profitability.





The
markets in which we operate are very competitive, and many of our competitors
and potential competitors are larger, more established and better capitalized
than we are.





The
markets in which we operate are very competitive and have been characterized by
rapid technological change. This competition could result in increased pricing
pressure, reduced profit margins, increased sales and marketing expenses, and
failure to increase, or the loss of, market share or expected market share, any
of which would likely seriously harm our business, operating results and
financial condition.





Some of
our competitors and potential competitors are substantially larger and have
greater financial, technical, marketing and other resources than we do. Given
their capital resources, the large companies with whom we compete or may compete
in the future, are in a better position to substantially increase their
manufacturing capacity, research and development efforts or to withstand any
significant reduction in orders by customers in our markets. Such larger
companies typically have broader and diverse product lines and market focus and
thus are not as susceptible to downturns in a particular market. In addition,
some of our competitors have been in operation much longer than we have and
therefore may have more long-standing and established relationships with
potential domestic and foreign customers.





Because
we are small and do not have much capital, we must limit our activities. As such
we will not be able to compete with large entities that market food
products.  We compete against other providers of gourmet foods, some
of which sell their products globally, and some of these providers have
considerably greater resources and abilities than we have. These competitors may
have greater marketing and sales capacity, established sales and distribution
networks, significant goodwill and global name recognition. Furthermore, it may
become necessary for us to reduce our prices in response to competition. This
could impact our ability to be profitable. In the event we are unable to attract
customers to our product, we will not generate revenues or profits. It that
occurs, you will lose your investment.





We would
be at a competitive disadvantage if our competitors bring their products to
market earlier, if their products are more technologically capable than ours, or
if any of our competitors’ products or technologies were to become preferred in
the industry. Moreover, we cannot be assured that potential customers will not
develop their own products, or acquire companies with products, that are
competitive with our future products. Any of these competitive threats could
have a material adverse effect on our business, operating results or financial
condition.





Inability
of Our Officers and Directors to Devote Sufficient Time to the Operation of the
Business May Limit Our Success.





Presently,
our officers and directors allocate only a portion of their time to the
operation of our business. If the business requires more time for operations
than anticipated or the business develops faster than anticipated, the officers
and directors may not be able to devote sufficient time to the operation of the
business to ensure that it continues as a going concern. This lack of sufficient
time of our management may result in limited growth and success of the
business.





We
do not own any patents, trademarks or copyrights





We do not
own any patents, trademarks or copyrights. We do not know if we are or will be
infringing on any patents, copyrights or trademarks. If we infringe on any
patents, trademarks or copyrights, we will be liable for damages and may be
enjoined from conducting our proposed business. Further, because we have no
patent or copyright covering our product, someone could use the information and
compete with us and we will have no recourse against him.


6




Changing
consumer preferences may impact our food products.




Consumer
preferences change, sometimes quickly, and the success of our food products
depends on our ability to identify the tastes and dietary habits of consumers
and offer products that appeal to their preferences. We introduce new products
and improved products, and incur development and marketing costs associated with
new products. If our new products fail to satisfy consumer expectations, then
our strategy to grow sales and profits with new products will be less
successful.





If
our sole officer and director resigns or dies without having found replacements,
our operations will cease. If that should occur, you could lose your
investment.





We have
one officer and director. We are entirely dependent upon him to conduct our
operations. If he should resign or die, there will be no one to control and
operate this company. Further, we do not have keyman insurance. If that should
occur, until we find others to conduct our operations, we will suspend our
operations or cease operating entirely. In that event, it is possible you could
lose your entire investment.





Because
our former sole officer and director, who is also a promoter, owns more than 50%
of the outstanding shares of the Company, she will retain control of us and will
be able to decide who will be directors and you will not be able to elect any
directors which could decrease the price and marketability of the
shares.





Neema
Lakhani owns 56,000,000 shares of our common stock and will continue to control
us. As a result, Ms. Lakhani will be able to elect all of our directors and
control our operations.





Our
board of directors does not intend to declare or pay any dividends to our
stockholders in the foreseeable future.





The
declaration, payment and amount of any future dividends will be made at the
discretion of our board of directors, and will depend upon, among other things,
the results of our operations, cash flows and financial condition, operating and
capital requirements, and other factors the board of directors considers
relevant. There is no plan to pay dividends in the foreseeable future, and if
dividends are paid, there can be no assurance with respect to the amount of any
such dividend.





Nevada
law and our articles of incorporation authorize us to issue shares of stock,
which shares may cause dilution to our existing shareholders.





Pursuant
to our Articles of Incorporation, we have, as of the date of this Report,
100,000,000 shares of common stock authorized. As of the date of this Report, we
have 89,120,000 shares of common stock issued and outstanding. As a result, our
Board of Directors has the ability to issue additional shares of common stock
without shareholder approval, which if issued could cause dilution to our then
shareholders.





A
limited public trading market exists for our common stock, which makes it more
difficult for our stockholders to sell their common stock in the public
markets.





Although
our common stock is quoted on the OTCBB under the symbol “CLDS” there is
currently no public market for our common stock. No assurance can be given that
an active market will develop or that a stockholder will ever be able to
liquidate its shares of common stock without considerable delay, if at all. Many
brokerage firms may not be willing to effect transactions in the securities.
Even if a purchaser finds a broker willing to effect a transaction in these
securities, the combination of brokerage commissions, state transfer taxes, if
any, and any other selling costs may exceed the selling price. Furthermore, our
future stock price may be impacted by factors that are unrelated or
disproportionate to our operating performance. These market fluctuations, as
well as general economic, political and market conditions, such as recessions,
lack of available credit, interest rates or international currency fluctuations
may adversely affect the future  market price and liquidity of our
common stock.


7





Our common stock may be subject to
the penny stock rules which may make it more difficult to sell our common
stock.





The
Securities and Exchange Commission has adopted regulations which generally
define a “penny stock” to be any equity security that has a market price, as
defined, less than $5.00 per share or an exercise price of less than $5.00 per
share, subject to certain exceptions. Our securities may be covered by the penny
stock rules, which impose additional sales practice requirements on
broker-dealers who sell to persons other than established customers and
accredited investors such as, institutions with assets in excess of $5,000,000
or an individual with net worth in excess of $1,000,000 or annual income
exceeding $200,000 or $300,000 jointly with his or her spouse. For transactions
covered by this rule, the broker-dealers must make a special suitability
determination for the purchase and receive the purchaser’s written agreement of
the transaction prior to the sale. Consequently, the rule may affect the ability
of broker-dealers to sell our securities and also affect the ability of our
stockholders to sell their shares in the secondary market.





ITEM
1B. UNRESOLVED STAFF
COMMENTS





None.





ITEM
2.  PROPERTIES





We
currently lease our registered offices at 11811 N Tatum Blvd, Suite 3031,
Phoenix, AZ 85028.





At fiscal
year end, the Company did not own or lease any other facilities.





ITEM
3.  LEGAL
PROCEEDINGS





The
Company and its property are not a party to any pending legal proceedings. In
the normal course of operations, the Company may have disagreements or disputes
with employees, vendors or customers.  These disputes are seen by the
Company’s management as a normal part of business, and there are no currently
pending actions or threatened actions that management believes would have a
significant material impact on the Company’s financial position, results of
operations or cash flows.





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





The
Company did not submit any matters to security holders during the fourth quarter
of its last fiscal year ended June 30, 2009.





PART
II





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





Market
Information





The
Company’s common stock, $0.00001 par value, has a symbol “CLDS” but is not
currently traded on the OTC Bulletin Board (“OTCBB”) exchange.





Stockholders





As of
June 30, 2009, we had 89,120,000 shares of common stock outstanding held
by 39 shareholders, not including certificates held in street
name.





Dividends





We have
not paid dividends to date and do not anticipate paying any dividends in the
foreseeable future. Our Board of Directors intends to follow a policy of
retaining earnings, if any, to reinvest and finance our growth. The declaration
and payment of dividends in the future will be determined by our Board of
Directors in light of conditions then existing, including our earnings,
financial condition, capital requirements and other factors.





Securities
Authorized For Issuance under Equity Compensation Plans





None.





Recent
Sales of Unregistered Securities





Since
inception, we have sold the following securities that were not registered under
the Securities Act of 1933, as follows:


8





a)
            On
      June 2, 2008, we issued 56,000,000 shares of common stock to Neema
      Lakhani, our former officer and director, in consideration of $0.000125
      per share or a total of $7,000. We issued the foregoing restricted shares
      of common stock pursuant to the exemption from registration contained in
      Regulation S of the Securities Act of 1933. The transaction took place
      outside the United States of America and Ms. Lakhani is a non-US
      person.





b)
            In
      June 2008, we sold 33,120,000 shares of common stock to 46 individuals in
      consideration of $0.00125 per share or a total of $41,400. The
      foregoing  33,120,000 shares of common stock were issued as
      restricted securities pursuant to Reg. S of the Securities Act of 1933 in
      that all of the sales took place outside the United States of America with
      non-US persons.





ITEM
6. SELECTED FINANCIAL
DATA.





As a
smaller reporting company, we are not required to provide this
information.





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





This
section of the report includes a number of forward-looking statements that
reflect our current views with respect to future events and financial
performance. Forward-looking statements are often identified by words like:
believe, expect, estimate, anticipate, intend, project and similar expressions,
or words which, by their nature, refer to future events. You should not place
undue certainty on these forward-looking statements, which apply only as of the
date of this report.


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 based upon estimates, forecasts, 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 us, or on our behalf. We disclaim any obligation to update
forward-looking statements.





The
discussion and financial statements contained herein are for our fiscal years
ended June 30, 2008 and June 30, 2009. The following discussion regarding our
financial statements should be read in conjunction with our financial statements
included herewith.





Financial
Condition as of June 30, 2009





We
reported total current assets of $4,440 on June 30, 2009, consisting of cash of
$290, prepaid expenses of $150 and a deferred license fee of $4,000. Total
current liabilities reported of $13,507 consisted of $9,019 in accounts payable
and accrued liabilities and expenses of $4,488 in notes, interest on notes and
advances due to related parties.





Stockholders'
Equity decreased from $32,204 for the year ended June 30, 2008 to a deficiency
of $9,067 at June 30, 2009.





Plan
of Operation





Background





We were
organized under the laws of the State of Nevada on June 2, 2008. We are a
start-up corporation and have not yet realized any revenues from our business
activities. On June 9, 2009, the Company effectuated an 8 for 1 forward stock
split, thereby increasing the issued and outstanding shares of common stock from
11,140,000 shares to 89,120,000 shares.





Our
auditors have issued a going concern opinion. This means that there is
substantial doubt that we can continue as an on-going business for the next
twelve months unless we obtain additional capital to pay our bills. This is
because we have not generated any revenues and no revenues are anticipated until
we begin marketing and selling our line of products. Accordingly, we must raise
cash from sources other than the sale of our product line. Our only other source
for cash at this time is investment by others in our complete private placement.
The cash we raised will allow us to stay in business for at least one year. Our
success or failure will be determined by our sales and marketing
efforts.





To meet
our need for cash we raised money from our private placement.  If it
turns out that we do not have enough money to continue operating, we will have
to find alternative sources, like a second public offering, a private placement
of securities, or loans from our officers or others.


9





If
required, our sole officer and director is willing to loan us money. At the
present time, we have not made any arrangements to raise additional cash. If we
need additional cash and can't raise it, we will either have to suspend
activities until we do raise the cash, or cease activities entirely. Other than
as described in this paragraph, we have no other financing plans.





We will
not be conducting research nor are we going to buy or sell any plant or
significant equipment during the next twelve months.





We do not
intend to hire additional employees at this time.  We will hire
additional employees on as needed basis.  Our initial need for
employees will be to process orders in the event sufficient order flow is
established.





Milestones





Our
milestones over the next twelve months are:





1.
            To develop
      and create a shopping cart on our  website to promote and sell
      our products online.  We expect to spend $1,500 to $10,000 for
      the new version website which will include a search engine, including a
      word search program with Google, which will be implemented to generate
      more traffic to our site.  We anticipate launching our new
      website in the second quarter of this
year.




2.
            Marketing
      and advertising will be focused on promoting our website and
      products.  The advertising campaign may also include the design
      and printing of various sales materials.  We intend to market
      our website through traditional sources such as advertising in magazines,
      billboards, telephone directories and preparing and sending out flyers and
      mailers both through the regular mail and via
      email.  Advertising and promotion will be an ongoing effort
      but the initial cost of developing the campaign is estimated to cost
      between $15,000 and $35,000.




3.
            We
      also plan to market our business and its online presence by attending some
      key trade food trade shows
in  2009.




4.
            We
      plan on targeting existing markets by aligning ourselves with food
      distribution companies where our products can be
      complimentary.





We
anticipate that we will generate revenues as soon as we are able to offer
products for sale on our website or through a distribution network.





Limited
Operating History; Need for Additional Capital





There is
no historical financial information about us upon which to base an evaluation of
our performance. We are a start-up corporation and have not generated any
revenues from activities. We cannot guarantee we will be successful in our
business activities. Our business is subject to risks inherent in the
establishment of a new business enterprise, including limited capital resources,
and possible cost overruns due to price and cost increases in
services.





To become
profitable and competitive, we must find customers and sell our
products.





In the
event we need additional funds for operations, we have no assurance that future
financing will be available to us on acceptable terms. If financing is not
available on satisfactory terms, we may be unable to continue, develop or expand
our activities. Equity financing could result in additional dilution to existing
shareholders.





Critical
Accounting Policies





The
preparation of financial statements in conformity with United States generally
accepted accounting principles requires management of our company to make
estimates and assumptions that affect the reported amounts of assets and
liabilities, the disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting periods.





Our
management routinely makes judgments and estimates about the effects of matters
that are inherently uncertain. As the number of variables and assumptions
affecting the probable future resolution of the uncertainties increase, these
judgments become even more subjective and complex. Our significant accounting
policies are discussed in Note 2 to our financial statements for the fiscal year
ended June 30, 2009 included in the Form 10-K. We have identified the following
accounting policies, described below, as the most important to an understanding
of our current financial condition and results of operations.


10





Basic
and Diluted Net Income (Loss) Per Share


The
Company computes net income (loss) per share in accordance with SFAS No. 128,
“Earnings per Share”. SFAS No. 128 requires presentation of both basic and
diluted earnings per share (EPS) on the face of the income statement. Basic EPS
is computed by dividing net income (loss) available to common shareholders
(numerator) by the weighted average number of shares outstanding (denominator)
during the period. Diluted EPS gives effect to all dilutive potential common
shares outstanding during the period using the treasury stock method and
convertible securities using the if-converted method. In computing diluted EPS,
the average stock price for the period is used in determining the number of
shares assumed to be purchased from the exercise of stock options or warrants.
Diluted EPS excludes all dilutive potential shares if their effect is
anti-dilutive.





Results
of Operations





The
following is Management’s discussion and analysis of certain significant factors
which have affected the Company’s financial condition and results of operations
during the periods included in the accompanying financial
statements.





Results
of Operations for the Year Ended June 30, 2009 as Compared to the Year Ended
June 30, 2008





Results of Operations, Year Ended
                  
                  June
      30, 2009
                  
                  
                  June
      30, 2008License
      Fees
                  
                  $
                  4,000
                  
                  
                  $
                  —General
      and Administrative
                  
                  
                  39,771
                  
                  
                  
                  16,296$
                  43,771
                  
                  
                  $
                  16,296





General
and administrative expenses





During
the fiscal year ended June 30, 2009, we incurred total expenses of $43,711 as
compared to $16,296 for the period June 2, 2008 (Inception) to June 30, 2008.
These expenses were related mainly to investor relations and professional
fees.  Other expenses were incurred in relation to activities
associated with maintaining a public listing, such as legal and accounting
fees.





Expenses
or other cash flows in this period may not be indicative of future periods as we
are in the early development stage.





From
Inception on June 2, 2008





We were
incorporated on June 2, 2008.  We executed our licensing agreement
with Ms. Lakhani, our former president, completed a private placement of
securities and raised $41,400, retained a lawyer and prepared our registration
statement.





Liquidity
and Capital Resources





As of
June 30, 2009, we had cash of $290.  During the period ended June 30,
2009, we funded our operations from the proceeds of private sales of equity and
convertible notes that occurred in the period ended June 30, 2008. We plan to
continue further financings and we believe that this will provide sufficient
working capital to fund our operations for at least the next 12 months. Changes
in our operating plans, increased expenses, additional acquisitions, or other
events, may cause us to seek additional equity or debt financing in the
future.





For the
period ended June 30, 2009, we had $0 cash flows from operations. We raised $0
during the fiscal year ended June 30, 2009.





We
currently have no revenue from operations. In order to meet our business
objectives, we will need to raise additional funds through equity or convertible
debt financing. There can be no assurance that we will be successful in raising
additional funds and, if unsuccessful, our plans for expanding operations and
business activities may have to be curtailed. Any attempt to raise funds,
through debt or equity financing, would likely result in dilution to existing
shareholders.





We
continue to operate with very limited administrative support, and our current
officers and directors continue to be responsible for many duties to preserve
our working capital.





We do not
anticipate making any major purchases of capital assets in the next six months.
We believe that, with our current efforts to raise capital, we will have
sufficient cash resources to satisfy our needs over the next twelve months. Our
ability to satisfy cash requirements thereafter will determine whether we
achieve our business objectives. Should we require additional cash in the
future, there can be no assurance that we will be successful in raising
additional debt or equity financing on terms acceptable to our company, if at
all.


11


We
anticipate that our cash requirements will be significant in the near term due
to our expected implementation of our marketing and sales
goals.  Accordingly, we expect to continue to use cash to fund
operations for at least the remaining of our fiscal year ended June 30, 2010, as
we look to generating sufficient revenue to meet our needs.





Prior
Financings





We issued
56,000,000 shares of common stock through a private placement pursuant to
Regulation S of the Securities Act of 1933 to Neema Lakhani, our former sole
officer and director on June 2, 2008 in consideration of $7,000.  Ms.
Lakhani is a non-US person and all transactions closed outside the United
States of America. This was accounted for as a purchase of shares of common
stock.





In June
2008, we completed a private placement of 33,120,000 restricted shares of common
stock pursuant to Reg. S of the Securities Act of 1933 and raised $41,400. All
of the shares were sold to non-US persons and all transactions closed outside
the United States of America. This was accounted for as a purchase of shares of
common stock.





Off-Balance
Sheet Arrangements





We
presently do not have any off-balance sheet arrangements.





Capital
Expenditures





We did
not make any capital expenditures in the fiscal year ended June 30,
2009.





The
following table outlines payments due under our significant contractual
obligations over the periods shown, exclusive of interest:





Payments Due by
                                    PeriodContract Obligations
                                    At June 30, 2009
                                  
                                  Total
                                  
                                  
                                  Less than
                                    1 Year
                                  
                                  
                                  1-3 years
                                  
                                  
                                  3-5 years
                                  
                                  
                                  More than
                                    5 yearsTotal Debt
                                  
                                  $
                                  0.00
                                  
                                  
                                  $
                                  0.00
                                  
                                  
                                  $
                                  0.00
                                  
                                  
                                  $
                                  0.00
                                  
                                  
                                  $
                                  0.00





The above
table outlines our obligations as of June 30, 2009 and does not reflect any
changes in our obligations that have occurred after that
date.





ITEM
7A.  QUANTITATIVE AND QUALITATIVE
DISCLOSURES ABOUT MARKET RISK





As a
smaller reporting company as defined by Rule 12b-2 of the Securities Exchange
Act of 1934, we are not required to provide this information.





ITEM
8.  FINANCIAL STATEMENTS AND
SUPPLEMENTARY DATA





Our
financial statements are included following the signature page to this Form
10-K.





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





None.





ITEM
9A(T).  CONTROLS AND
PROCEDURES





We
carried out an evaluation, under the supervision and with the participation of
our management, including our Principal Executive Officer along with our
Principal Financial Officer, of the effectiveness of the design of the our
disclosure controls and procedures (as defined by Exchange Act
Rule 13a-15(e) and 15d-15(e)) as of the end of our fiscal year pursuant to
Exchange Act Rule 13a-15. Based upon that evaluation, our Principal
Executive Officer along with our Principal Financial Officer concluded that our
disclosure controls and procedures are effective in ensuring that information
required to be disclosed by us in reports that we file or submit under the
Exchange Act is recorded, processed, summarized and reported within the time
periods specified in the Securities and Exchange Commission’s rules and forms
and that such information is accumulated and communicated to our management,
including our Principal Executive Officer and Principal Financial Officer, as
appropriate, to allow timely decisions regarding required
disclosure.


12


Management’s
Report on Internal Control over Financial Reporting





Our
management is responsible for establishing and maintaining adequate internal
control over financial reporting as defined in Rules 13a-15(f) and
15d-15(f) under the Exchange Act. Under the supervision and with the
participation of our management, including our Chief Executive Officer and Chief
Financial Officer, we conducted an evaluation of the effectiveness of our
internal control over financial reporting based on criteria established in the
framework inInternal Control –
Integrated Framework  issued by the Committee of Sponsoring
Organizations of the Treadway Commission. Based on this evaluation, our
management concluded that our internal control over financial reporting was
effective as of June 30, 2009.





Because
of its inherent limitations, internal control over financial reporting may not
prevent or detect misstatements. Projections of any evaluation of effectiveness
to future periods are subject to the risk that controls may become inadequate
because of changes in conditions, or that the degree of compliance with the
policies or procedures may deteriorate. All internal control systems, no matter
how well designed, have inherent limitations. Therefore, even those systems
determined to be effective can provide only reasonable assurance with respect to
financial statement preparation and presentation.





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





ITEM
9B.  OTHER
INFORMATION





None.





PART
III





ITEM
10.  DIRECTORS, EXECUTIVES
OFFICERS AND CORPORATE GOVERNANCE





Directors
and Executive Officers





Our
directors serve until their successor is elected and qualified. Each of our
officers is elected by the board of directors to a term of one (1) year and
serves until his or her successor is duly elected and qualified, or until he or
she is removed from office. The board of directors has no nominating, auditing
or compensation committees.





The
following table sets forth the names and ages of our current directors and
executive officers, the principal offices and positions held by each
person:





Person
                
                Age
                
                PositionJohn
      J. Lennon
                
                53
                
                President,
      Chief Executive Officer, Treasurer, Secretary,
  Director





Mr.
Lennon will serve until our next annual meeting of the stockholders. The Board
of Directors elects officers and their terms of office are at the discretion of
the Board of Directors.





John
J. Lennon





John J.
Lennon has been our president, principal executive officer, secretary,
treasurer, principal financial officer, principal accounting officer, and member
of our board of directors since September 21, 2009.





From May
30, 2008 to July 7, 2009, Mr. Lennon served as Treasurer, VP of Finance and
Director of Brite-Strike Tactical Illumination Products, Inc.; from February
2009 to June 2009, as President, Chief Financial Officer and Secretary of
American Petro-Hunter, Inc., from June 2009, as Chief Financial Officer and
Secretary of American Petro-Hunter, Inc.; from May 2009, as President, Chief
Financial Officer and Secretary of GC China Turbine Corp.; from March 2009, as
President, Chief Financial Officer and Secretary of LED Power Group, Inc.; from
2004, as President of Chamberlain Capital Partners; from 2006, as Director of
American Durahomes and from 2005-2007, as Treasurer/Director/VP of Finance of US
Starcom. Chamberlain Capital Partners assists companies in the area of
maximizing shareholder value through increased sales, cost reduction and refined
business strategy. Mr. Lennon has also assisted companies in obtaining debt
financing, private placements or other methods of funding. He is responsible for
corporate reporting, press releases, and funding related initiatives for
American Durahomes, a private corporation, and previously for US Starcom, a
public entity. On December 31, 2007, Mr. Lennon was appointed Chief Executive
Officer, President, Chief Financial Officer, Secretary, Treasurer and director
of Explortex Energy Inc., a publicly reporting company, which is a natural
resource exploration company engaged in the participation in drilling of oil and
gas in the United States.  Mr. Lennon resigned from his positions at
Explortex Energy Inc. on June 29, 2009.  From 1987 to 2004, Mr. Lennon
served as Senior Vice President of Janney Montgomery Scott, Osterville, MA,
Smith Barney and Prudential Bache Securities, managing financial assets for high
net worth individuals.


13


Mr.
Lennon currently serves on the Board of Directors of American Petro-Hunter,
Inc., GC China Turbine Corp. and LED Power Group, Inc.





Audit
Committee





Our  Board
of Directors  has not  established  a
separate  audit committee within the meaning of
Section  3(a)(58)(A) of the Securities  Exchange Act of
1934,  as
amended  (the  "Exchange  Act").  Instead,
the entire Board of Directors acts as the audit committee within the meaning of
Section 3(a)(58)(B) of the  Exchange  Act.  We are
seeking candidates for outside directors to serve on a separate audit committee
when we establish one. Due to our small size and limited operations and
resources, it has been difficult to recruit outside directors.





Audit
Committee Financial Expert





We do not
have an audit committee financial expert because we believe the cost related to
retaining a financial expert at this time is prohibitive. Further, because we
are only beginning our commercial operations, at the present time, we believe
the services of a financial expert are not warranted.





Code
of Ethics





Given our
limited operations and resources and because we are in the development stage, we
have not yet adopted a code of ethics. Upon commencement of significant
operations and hiring other executive officers, we intend to adopt a code of
ethics that will apply to all our officers, directors and
employees.





Compliance
with Section 16(a) of the Securities Exchange Act of 1934





Based
solely upon a review of Forms 3, 4 and 5 delivered to us as filed with the
Securities Exchange Commission, our former President and Director, Neema
Lakhyani, failed to file on a timely basis Form 3 and Form 4s as required
pursuant to Section 16(a) of the Securities Exchange Act.





Except as
set forth above, and based solely upon a review of Forms 3, 4 and 5 delivered to
us as filed with the Securities Exchange Commission, our executive officers and
directors, and persons who own more than 10% of our Common Stock timely filed
all required reports pursuant to Section 16(a) of the Securities Exchange
Act.





ITEM
11.  EXECUTIVE
COMPENSATION





The
summary compensation table below shows certain compensation information for
services rendered in all capacities to us by our principal executive officer and
by each other executive officer whose total annual salary and bonus exceeded
$100,000 during the fiscal periods ended June 30, 2009 and June 30, 2008. Other
than as set forth below, no executive officer’s total annual compensation
exceeded $100,000 during our last fiscal period. This information includes the
dollar value of base salaries, bonus awards and number of stock options granted,
and certain other compensation, if any. The compensation discussed addresses all
compensation awarded to, earned by, or paid or named executive
officers.





Summary
Compensation Table





Name and Principal
                                                                  Position (a)
                                                                
                                                                Year
                                                                  (b)
                                                                
                                                                Salary
                                                                  ($)
                                                                  (c)
                                                                
                                                                
                                                                Bonus
                                                                  ($)
                                                                  (d)
                                                                
                                                                
                                                                Stock
                                                                  Awards
                                                                  ($)
                                                                  (e)(2)
                                                                
                                                                
                                                                Option
                                                                  Awards
                                                                  ($)
                                                                  (f)
                                                                
                                                                
                                                                Non
                                                                  Equity
                                                                  Incentive
                                                                  Plan
                                                                  Compensa
                                                                  tion
                                                                  ($)
                                                                
                                                                
                                                                Non-qualified
                                                                  Deferred
                                                                  Compensation
                                                                  Earnings
                                                                  ($)
                                                                  (h)
                                                                
                                                                
                                                                All
      Other
                                                                  Compensa
                                                                  tion
                                                                  ($)
                                                                  (i)
                                                                
                                                                
                                                                Total
                                                                  ($)
                                                                  (j)Neema
      Lakhani
                                                                
                                                                2007
                                                                
                                                                $
                                                                -0-
                                                                
                                                                
                                                                $
                                                                -0-
                                                                
                                                                
                                                                $
                                                                -0-
                                                                
                                                                
                                                                $
                                                                -0-
                                                                
                                                                
                                                                $
                                                                -0-
                                                                
                                                                
                                                                $
                                                                -0-
                                                                
                                                                
                                                                $
                                                                -0-
                                                                
                                                                
                                                                $
                                                                -0-Former
      President,
                                                                
                                                                2008
                                                                
                                                                $
                                                                -0-
                                                                
                                                                
                                                                $
                                                                -0-
                                                                
                                                                
                                                                $
                                                                -0-
                                                                
                                                                
                                                                $
                                                                -0-
                                                                
                                                                
                                                                $
                                                                -0-
                                                                
                                                                
                                                                $
                                                                -0-
                                                                
                                                                
                                                                $
                                                                -0-
                                                                
                                                                
                                                                $
                                                                -0-Treasurer*
                                                                
                                                                2009
                                                                
                                                                $
                                                                -0-
                                                                
                                                                
                                                                $
                                                                -0-
                                                                
                                                                
                                                                $
                                                                -0-
                                                                
                                                                
                                                                $
                                                                -0-
                                                                
                                                                
                                                                $
                                                                -0-
                                                                
                                                                
                                                                $
                                                                -0-
                                                                
                                                                
                                                                $
                                                                -0-
                                                                
                                                                
                                                                $
                                                                -0-





* Ms.
Lakhani resigned all of her positions with our company effective September 21,
2009.


14


We have
no employment agreements with any of our officers. We do not contemplate
entering into any employment agreements until such time as we begin profitable
operations.
 
 The
compensation discussed herein addresses all compensation awarded to, earned by,
or paid to our named executive officers.
 
 There are
no other stock option plans, retirement, pension, or profit sharing plans for
the benefit of our officers and directors other than as described
herein.
 
 Compensation
of Directors
 
 Members
of our board of directors are not compensated for their services as directors.
The board has not implemented a plan to award options to any directors. There
are no contractual arrangements with any member of the board of directors. We
have no director's service contracts.
 
 Long-Term
Incentive Plan Awards
 
 We do not
have any long-term incentive plans that provide compensation intended to serve
as incentive for performance.
  ITEM
      12.
              SECURITY OWNERSHIP OF
      CERTAIN BENEFICIAL OWNERS AND MANAGEMENT ANDRELATED STOCKHOLDER
      MATTERS
 
 Security
Ownership Of Certain Beneficial Owners And Management
 
 The
following table sets forth, as of October 13, 2009, the number and percentage of
outstanding shares of our common stock owned by (i) each person known to us to
beneficially own more than 5% of our outstanding common stock, (ii) each
director, (iii) each named executive officer, and (iv) all executive officers
and directors as a group. Share ownership is deemed to include all shares that
may be acquired through the exercise or conversion of any other security
immediately or within the next sixty days. Such shares that may be so acquired
are also deemed outstanding for purposes of calculating the percentage of
ownership for that individual or any group of which that individual is a member.
Unless otherwise indicated, the stockholders listed possess sole voting and
investment power with respect to the shares shown.
 
 Name and Address of Beneficial Owner
      (1)
                        
                        Amount and Nature of
                          Beneficial Ownership
                        
                        
                        Percent of Class
                          of Common StockJohn
      J. Lennon
                        
                        
                        -
                        
                        
                        
                        0
                        %1694
      Falmouth Road, Suite 150
                          Centerville,
      Massachusetts
                          02630Centerville,
      MassachusettsNeema
      Lakhani
                        
                        
                        56,000,000
                        
                        
                        
                        62.84
                        %1621
      McEwen Drive, #21
                          Whitby,
      Ontario, Canada
                          L1N
      9A5Ownership
      of all directors
                          and
      officers as a group (1 person)
                        
                        
                        -
                        
                        
                        
                        0
                        %
 
 (1)
              Unless
      otherwise noted, the security ownership disclosed in this table is of
      record and beneficial.  Unless provided for otherwise, the
      address for each of the beneficial owners named below is the Company's
      business address.
  (2)
              Under
      Rule 13-d under the Exchange Act, shares not outstanding but subject to
      options, warrants, rights, conversion privileges pursuant to which such
      shares may be acquired in the next 60 days are deemed to be outstanding
      for the purpose of computing the percentage of outstanding shares owned by
      the persons having such rights, but are not deemed outstanding for the
      purpose of computing the percentage for such other
  persons.
  15















There are
no voting trusts or similar arrangements known to us whereby voting power is
held by another party not named herein. We know of no trusts, proxies, power of
attorney, pooling arrangements, direct or indirect, or any other contract
arrangement or device with the purpose or effect of divesting such person or
persons of beneficial ownership of our common shares or preventing the vesting
of such beneficial ownership.





ITEM
13.  CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTORINDEPENDENCE





Related
Party Transactions




Although
we have not adopted a Code of Ethics, we rely on our board to review related
party transactions on an ongoing basis to prevent conflicts of interest. Our
board reviews a transaction in light of the affiliations of the director,
officer or employee and the affiliations of such person’s immediate family.
Transactions are presented to our board for approval before they are entered
into or, if this is not possible, for ratification after the transaction has
occurred. If our board finds that a conflict of interest exists, then it will
determine the appropriate remedial action, if any. Our board approves or
ratifies a transaction if it determines that the transaction is consistent with
the best interests of the Company.





On June
2, 2008, the Company issued 56,000,000 shares of restricted common stock to
Neema Lakhani, the former President of the Company at $0.000125 per share for
cash proceeds of $7,000.





On July
2, 2008 we entered into a licensing agreement license with our former president,
Neema Lakhani. The term of the license is from July 2, 2008 to July 2, 2010. Our
license is an exclusive in the United States of America. Under the license we
have a right to sell the products in the United States of America. We may not
alter or modify the packaging used for the products except of comply with state
and federal laws. In all published versions of the products, we are required to
place a copyright notice showing that the owner of the products is Ms. Lakhani.
The consideration for the license is a promise to pay Ms. Lakhani 10% of all
gross sales proceeds plus $8,000, which has already been paid. We have the right
to promote and market the products in a manner determined by us within the
United States of America. Any and all promotional materials developed by us will
be the sole property of Ms. Lakhani. Our license may be terminated by us or by
Ms. Lakhani upon 120 days notice in writing.





Further,
Ms. Lakhani has advanced funds to us for some of our incorporation needs. As of
June 30, 2009, Ms. Lakhani advanced us $4,223. There is no due date for the
repayment of the funds advanced by Ms. Lakhani. Ms. Lakhani will be repaid from
revenues or operations if and when we generate revenues to pay the obligation.
There is no assurance that we will ever generate revenues from our operations.
The obligation to Ms. Lakhani does not bear interest. There is no written
agreement evidencing the advancement of funds by Ms. Lakhani or the repayment of
the funds to Ms. Lakhani. The entire transaction was oral.





As of
June 30, 2009, the Company is indebted to the President of the Company for
$4,223 (June 30, 2008 - $399). This amount is unsecured, non-interest bearing
and has no terms of repayment.




The
Company receives services from its president at no cost to the Company. For
accounting purposes, the estimated fair value of these donated services ($200
per month for the services) is included in general and administrative expenses
and additional paid-in capital is increased by the same amounts. During the
twelve month period ended June 30, 2009, the Company expensed $2,400 for donated
services.





Director
Independence





During
2008, we did not have any independent directors on our board.  We
evaluate independence by the standards for director independence established by
applicable laws, rules, and listing standards including, without limitation, the
standards for independent directors established by The New York Stock Exchange,
Inc., The NASDAQ National Market, and the Securities and Exchange
Commission.




Subject
to some exceptions, these standards generally provide that a director will not
be independent if (a) the director is, or in the past three years has been,
an employee of ours; (b) a member of the director’s immediate family is, or
in the past three years has been, an executive officer of ours; (c) the
director or a member of the director’s immediate family has received more than
$120,000 per year in direct compensation from us other than for service as a
director (or for a family member, as a non-executive employee); (d) the
director or a member of the director’s immediate family is, or in the past three
years has been, employed in a professional capacity by our independent public
accountants, or has worked for such firm in any capacity on our audit;
(e) the director or a member of the director’s immediate family is, or in
the past three years has been, employed as an executive officer of a company
where one of our executive officers serves on the compensation committee; or
(f) the director or a member of the director’s immediate family is an
executive officer of a company that makes payments to, or receives payments
from, us in an amount which, in any twelve-month period during the past three
years, exceeds the greater of $1,000,000 or two percent of that other company’s
consolidated gross revenues.


16





ITEM
14.  PRINCIPAL ACCOUNTING FEES
AND SERVICES





The
following table shows the fees paid or accrued by us for the audit and other
services provided by Michael T. Studer, CPA, P.C. for the fiscal periods
shown.




June 30, 2009
                        
                        
                        June
      30, 2008Audit
      Fees
                        
                        $
                        11,918
                        
                        
                        $
                        —Audit
      — Related Fees
                        
                        
                        —
                        
                        
                        
                        —Tax
      Fees
                        
                        
                        —
                        
                        
                        
                        —All
      Other Fees
                        
                        
                        —
                        
                        
                        
                        —Total
                        
                        $
                        11,918
                        
                        
                        $
                        —





Audit
fees consist of fees billed for professional services rendered for the audit of
our financial statements and review of the interim financial statements included
in quarterly reports and services that are normally provided by the above
auditors in connection with statutory and regulatory fillings or
engagements





In the
absence of a formal audit committee, the full Board of Directors pre-approves
all audit and non-audit services to be performed by the independent registered
public accounting firm in accordance with the rules and regulations promulgated
under the Securities Exchange Act of 1934, as amended. The Board of Directors
pre-approved 100% of the audit, audit-related and tax services performed by the
independent registered public accounting firm in fiscal 2009. The percentage of
hours expended on the principal accountant's engagement to audit the Company's
financial statements for the most recent fiscal year that were attributed to
work performed by persons other than the principal accountant's full-time,
permanent employees was 0%.


17


PART
IV





ITEM
15. EXHIBITS,
FINANCIAL STATEMENT SCHEDULES





Exhibits


The
following exhibits are included as part of this report by
reference:





3.1(1)
              
              Articles
      of Incorporation of Company, as filed with the Secretary of State of
      Nevada on June 2, 2008.3.2
      (1)
              
              Bylaws
      of Company10.1(1)
              
              Exclusive
      Product License Agreement between the Celestial Delights USA Corp. (the
      “Company”) and Celestial Delights, a sole proprietorship company located
      in Ontario Canada, and Neema Lakhani, the former president and majority
      shareholder of our Company31.1
              
              Rule
      13(a) — 14(a)/15(d) — 14(a) Certification (Principal Executive
      Officer)31.2
              
              Rule
      13(a) — 14(a)/15(d) — 14(a) Certification (Principal Financial
      Officer)32
              
              Certification
      Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of
      the Sarbanes-Oxley Act of
2002




(1)
            incorporated
      herein by reference to exhibits previously filed on Registrant’s
      Registration Statement on Form S-1, filed on September 12,
      2008.


18





SIGNATURES





In
accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934, as
amended (the “Exchange Act”) the Registrant caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.





CELESTIAL
DELIGHTS USA CORP.





Dated:
      October 13, 2009
            /s/
      John J. LennonBy:
      John J. LennonIts:
      President, Secretary, Treasurer and Director(Principal
      Executive Officer)Dated:
      October 13, 2009
            /s/
      John J. LennonBy:
      John J. LennonIts:
      President, Secretary, Treasurer and Director(Principal
      Financial Officer and Principal Accounting
              Officer)





Pursuant
to 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:





Signature
            
            Capacity
            
            Date/s/
      John J. Lennon
            
            Director
            
            October
      13, 2009John
      J. Lennon


19





Celestial
Delights USA Corp.


(A Development Stage Company)


Index
to Financial Statements


June
30, 2009





INDEX





PageReport
      of Independent Registered Public Accounting Firm
                
                
                F-2Financial
      StatementsBalance
      Sheets
                
                
                F-3Statements
      of Operations
                
                
                F-4Statements
      of Stockholders’ Equity (Deficiency)
                
                
                F-5Statements
      of Cash Flows
                
                
                F-6Notes
      to Financial Statements
                
                
                F-7


F-1




REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM




To the
Board of Directors and Stockholders of


Celestial
Delights USA Corp.




I have
audited the accompanying balance sheets of Celestial Delights USA Corp. (the
Company), a development stage company, as of June 30, 2009 and  2008
and  the related statements of operations, stockholders’ equity
(deficiency), and cash flows for the year ended June 30, 2009, for
the  period June 2, 2008 (inception) to June 30, 2008 and for the
period June 2, 2008 (inception) to June 30, 2009. These financial statements are
the responsibility of the Company’s management. My responsibility is to express
an opinion on these financial statements based on my audits.




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




In my
opinion, the financial statements referred to above present fairly, in all
material respects, the financial position of Celestial Delights USA Corp., a
development stage company, as of June 30, 2009 and 2008  and the
results of its operations and its cash flows for the year ended June30, 2009,
for the period June 2, 2008 (inception) to June 30, 2008 and for the period June
2, 2008 (inception) to June 30, 2009  in conformity with accounting
principles generally accepted in the United States.




The
accompanying financial statements referred to above have been prepared assuming
that the Company will continue as a going concern. As discussed in Note 1 to the
financial statements, the Company’s present financial situation raises
substantial doubt about its ability to continue as a going concern. Management’s
plans in regard to this matter are also described in Note 1. The financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.




/s/ Michael T. Studer CPA
    P.C.Michael T. Studer CPA
      P.C.




Freeport,
New York


October  9,
2009


F-2


Celestial
Delights USA Corp.


(A
Development Stage Company)


Balance
Sheets





June
      30,
                                                                
                                                                
                                                                June
      30,2009
                                                                
                                                                
                                                                2008ASSETSCurrent
      AssetsCash
                                                                
                                                                $
                                                                290
                                                                
                                                                
                                                                $
                                                                32,553Prepaid
      expenses
                                                                
                                                                
                                                                150
                                                                
                                                                
                                                                
                                                                150Deferred
      license fee
                                                                
                                                                
                                                                4,000
                                                                
                                                                
                                                                
                                                                -Total
      Assets
                                                                
                                                                $
                                                                4,440
                                                                
                                                                
                                                                $
                                                                32,703LIABILITIES
      AND STOCKHOLDERS' EQUITY (DEFICIENCY)Current
      LiabilitiesAccounts
      payable and accrued liabilities
                                                                
                                                                $
                                                                9,019
                                                                
                                                                
                                                                $
                                                                -Due
      to related party
                                                                
                                                                
                                                                4,488
                                                                
                                                                
                                                                
                                                                399Total
      current liabilities
                                                                
                                                                
                                                                13,507
                                                                
                                                                
                                                                
                                                                399Stockholders'
      Equity (Deficiency)Preferred
      stock, $0.00001 par value;authorized
      100,000,000 shares, none issued
                                                                
                                                                
                                                                -
                                                                
                                                                
                                                                
                                                                -Common
      stock, $0.00001 par value;authorized
      100,000,000 shares,issued
      and outstanding 89,120,000 and 89,120,000 shares,
    respectively
                                                                
                                                                
                                                                891
                                                                
                                                                
                                                                
                                                                891Additional
      paid-in capital
                                                                
                                                                
                                                                50,109
                                                                
                                                                
                                                                
                                                                47,709Deficit
      accumulated during the development stage
                                                                
                                                                
                                                                (60,067
                                                                )
                                                                
                                                                
                                                                (16,296
                                                                )Total
      Stockholders' Equity (Deficiency)
                                                                
                                                                
                                                                (9,067
                                                                )
                                                                
                                                                
                                                                32,304Total
      Liabilities and Stockholders' Equity (Deficiency)
                                                                
                                                                $
                                                                4,440
                                                                
                                                                
                                                                $
                                                                32,703





See
notes to financial statements.


F-3





Celestial
Delights USA Corp.


(A
Development Stage Company)


Statements
of Operations





Year
      ended
                                              June
      30,
                                              2009
                                            
                                            
                                            Period
                                              June
      2, 2008
                                              (Inception)
      to
                                              June
      30,
                                              2008
                                            
                                            
                                            Period
                                              June
      2, 2008
                                              (Inception)
                                              to
      June 30,
                                              2009Revenue
                                            
                                            $
                                            -
                                            
                                            
                                            $
                                            -
                                            
                                            
                                            $
                                            -Total
      Revenue
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -Cost
      and expensesLicense
      fees
                                            
                                            
                                            4,000
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            4,000General
      and administrative
                                            
                                            
                                            39,771
                                            
                                            
                                            
                                            16,296
                                            
                                            
                                            
                                            56,067Total
      Costs and Expenses
                                            
                                            
                                            43,771
                                            
                                            
                                            
                                            16,296
                                            
                                            
                                            
                                            60,067Net
      Loss
                                            
                                            $
                                            (43,771
                                            )
                                            
                                            $
                                            (16,296
                                            )
                                            
                                            $
                                            (60,067
                                            )Net
      Loss per shareBasic
      and diluted
                                            
                                            $
                                            (0.00
                                            )
                                            
                                            $
                                            (0.00
                                            )Number
      of common shares used to compute net loss per shareBasic
      and Diluted
                                            
                                            
                                            89,120,000
                                            
                                            
                                            
                                            57,184,000





See
notes to financial statements.


F-4





Celestial
Delights USA Corp.


(A
Development Stage Company)


Statements
of Stockholders' Equity (Deficiency)


For
the period June 2, 2008 (Inception) to June 30, 2009





Common
      Stock, $0.00001 Par Value
                                  
                                  
                                  Additional
      Paid-
                                  
                                  
                                  Deficit
                                    Accumulated
                                    During
      the
                                  
                                  
                                  Total
                                    Stockholders'
                                    EquityShares
                                  
                                  
                                  Amount
                                  
                                  
                                  in
      Capital
                                  
                                  
                                  Development
      Stage
                                  
                                  
                                  (Deficiency)Sales
      of Common stock;-
      June 2, 2008 at $0.000125
                                  
                                  
                                  56,000,000
                                  
                                  
                                  $
                                  560
                                  
                                  
                                  $
                                  6,440
                                  
                                  
                                  $
                                  -
                                  
                                  
                                  $
                                  7,000-
      June 30, 2008 at $0.00125
                                  
                                  
                                  33,120,000
                                  
                                  
                                  
                                  331
                                  
                                  
                                  
                                  41,069
                                  
                                  
                                  
                                  -
                                  
                                  
                                  
                                  41,400Donated
      expenses
                                  
                                  
                                  -
                                  
                                  
                                  
                                  -
                                  
                                  
                                  
                                  200
                                  
                                  
                                  
                                  -
                                  
                                  
                                  
                                  200Net
      loss for the period June 2, 2008 (inception)to
      June 30, 2008
                                  
                                  
                                  -
                                  
                                  
                                  
                                  -
                                  
                                  
                                  
                                  -
                                  
                                  
                                  
                                  (16,296
                                  )
                                  
                                  
                                  (16,296
                                  )Balance,
      June 30, 2008
                                  
                                  
                                  89,120,000
                                  
                                  
                                  
                                  891
                                  
                                  
                                  
                                  47,709
                                  
                                  
                                  
                                  (16,296
                                  )
                                  
                                  
                                  32,304Donated
      expenses
                                  
                                  
                                  -
                                  
                                  
                                  
                                  -
                                  
                                  
                                  
                                  2,400
                                  
                                  
                                  
                                  -
                                  
                                  
                                  
                                  2,400Net
      loss for the year ended June 30, 2009
                                  
                                  
                                  -
                                  
                                  
                                  
                                  -
                                  
                                  
                                  
                                  -
                                  
                                  
                                  
                                  (43,771
                                  )
                                  
                                  
                                  (43,771
                                  )Balance,
      June 30, 2009
                                  
                                  
                                  89,120,000
                                  
                                  
                                  $
                                  891
                                  
                                  
                                  $
                                  50,109
                                  
                                  
                                  $
                                  (60,067
                                  )
                                  
                                  $
                                  (9,067
                                  )





See
notes to financial statements.


F-5





Celestial
Delights USA Corp.


(A
Development Stage Company)


Statements
of Cash Flows





Year
      ended
                                        June
      30,
                                        2009
                                      
                                      
                                      Period
                                        June
      2, 2008
                                        (Inception)
      to
                                        June
      30, 2008
                                      
                                      
                                      Period
                                        June
      2, 2008
                                        (Inception)
      to
                                        June
      30, 2009Cash
      Flows from Operating ActivitiesNet
      loss
                                      
                                      $
                                      (43,771
                                      )
                                      
                                      $
                                      (16,296
                                      )
                                      
                                      $
                                      (60,067
                                      )Adjustments
      to reconcile net loss to net cashprovided
      by (used for) operating activities:Amortization
      of deferred license fee
                                      
                                      
                                      4,000
                                      
                                      
                                      
                                      -
                                      
                                      
                                      
                                      4,000Donated
      expenses
                                      
                                      
                                      2,400
                                      
                                      
                                      
                                      200
                                      
                                      
                                      
                                      2,600Changes
      in operating assets and liabilities:Accounts
      payable and accrued liabilities
                                      
                                      
                                      9,019
                                      
                                      
                                      
                                      -
                                      
                                      
                                      
                                      9,019Prepaid
      expenses
                                      
                                      
                                      -
                                      
                                      
                                      
                                      (150
                                      )
                                      
                                      
                                      (150
                                      )Net
      cash used for operating activities
                                      
                                      
                                      (28,352
                                      )
                                      
                                      
                                      (16,246
                                      )
                                      
                                      
                                      (44,598
                                      )Cash
      Flows from Investing ActivitiesLicense
      fee due in connection with Product License Agreement
                                      
                                      
                                      (8,000
                                      )
                                      
                                      
                                      -
                                      
                                      
                                      
                                      (8,000
                                      )Net
      cash used for investing activities
                                      
                                      
                                      (8,000
                                      )
                                      
                                      
                                      -
                                      
                                      
                                      
                                      (8,000
                                      )Cash
      Flows from Financing ActivitiesProceeds
      from sales of common stock
                                      
                                      
                                      -
                                      
                                      
                                      
                                      48,400
                                      
                                      
                                      
                                      48,400Increase
      in due to related party
                                      
                                      
                                      4,089
                                      
                                      
                                      
                                      399
                                      
                                      
                                      
                                      4,488Net
      cash provided by financing activities
                                      
                                      
                                      4,089
                                      
                                      
                                      
                                      48,799
                                      
                                      
                                      
                                      52,888(Decrease)
      Increase in cash
                                      
                                      
                                      (32,263
                                      )
                                      
                                      
                                      32,553
                                      
                                      
                                      
                                      290Cash,
      beginning of period
                                      
                                      
                                      32,553
                                      
                                      
                                      
                                      -
                                      
                                      
                                      
                                      -Cash,
      end of period
                                      
                                      $
                                      290
                                      
                                      
                                      $
                                      32,553
                                      
                                      
                                      $
                                      290Supplemental
      Disclosures of Cash Flow Information:Interest
      paid
                                      
                                      $
                                      -
                                      
                                      
                                      $
                                      -Income
      taxes paid
                                      
                                      $
                                      -
                                      
                                      
                                      $
                                      -





See
notes to financial statements.


F-6





NOTES TO
FINANCIAL STATEMENTS





Note 1.
Organization and
Business Operations




Celestial
Delights USA Corp. (the “Company”) was incorporated in the State of Nevada on
June 2, 2008. The Company’s principal business is to market and distribute a
unique line of gourmet flavored oils, vinegars, mustards, rubs, antipastos, and
sugars for sale to specialty retail stores and gift basket markets.




On June
9, 2009, the Company effectuated an 8 for 1 forward stock split, thereby
increasing the issued and outstanding shares of common stock from 11,140,000
shares to 89,120,000 shares. The financial statements have been retroactively
adjusted to reflect this forward stock split.




These
financial statements have been prepared on a going concern basis, which implies
the Company will continue to realize its assets and discharge its liabilities in
the normal course of business. At June 30, 2009, the Company has negative
working capital and a stockholders’ deficiency of $9,067. Further, the Company
has not generated any revenues and incurred $60,067 in net losses since
inception. These factors raise substantial doubt regarding the Company’s ability
to continue as a going concern. The Company plans to improve its financial
condition by obtaining new financing either by loans or sales of its common
stock. However, there is no assurance that the Company will be successful in
accomplishing this objective. These financial statements do not include any
adjustments to the recoverability and classification of recorded asset amounts
and classification of liabilities that might be necessary should the Company be
unable to continue as a going concern.




Note 2.
Summary of Significant
Accounting Policies




a)
            Basis
      of Presentation




These
financial statements and related notes are presented in accordance with
accounting principles generally accepted in the United States, and are expressed
in US dollars. The Company’s fiscal year end is June 30.




b)
            Use
      of Estimates




The
preparation of these financial statements in conformity with US generally
accepted accounting principles 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 dates of the financial
statements and the reported amounts of revenues and expenses during the
reporting periods. Actual results could differ from those
estimates.  The Company regularly evaluates estimates and assumptions
related to donated services and deferred income tax valuations. The Company
bases its estimates and assumptions on current facts, historical experience and
various other factors that it believes to be reasonable under the circumstances,
the results of which form the basis for making judgments about the carrying
values of assets and liabilities and the accrual of costs and expenses that are
not readily apparent from other sources. The actual results experienced by the
Company may differ materially and adversely from the Company’s estimates. To the
extent there are material differences between the estimates and the actual
results, future results of operations will be affected.




c)
            Basic
      and Diluted Net Income (Loss) Per
Share




The
Company computes net income (loss) per share in accordance with SFAS No. 128,
"Earnings per Share".
SFAS No. 128 requires presentation of both basic and diluted earnings per share
(EPS) on the face of the income statement. Basic EPS is computed by dividing net
income (loss) available to common shareholders (numerator) by the weighted
average number of shares outstanding (denominator) during the period. Diluted
EPS gives effect to all dilutive potential common shares outstanding during the
period using the treasury stock method and convertible securities using the
if-converted method. In computing diluted EPS, the average stock price for the
period is used in determining the number of shares assumed to be purchased from
the exercise of stock options or warrants. Diluted EPS excludes all dilutive
potential shares if their effect is anti dilutive.




d)
            Comprehensive
      Loss




SFAS No.
130, “Reporting Comprehensive
Income,” establishes standards for the reporting and display of
comprehensive loss and its components in the financial statements. As at June
30, 2009 and 2008, the Company has no items that represent a comprehensive loss
and, therefore, has not included a schedule of comprehensive loss in the
financial statements.




e)
            Cash
      and Cash Equivalents




The
Company considers all highly liquid instruments with maturity of three months or
less at the time of issuance to be cash equivalents.




F-7




f)
            Financial
      Instruments




SFAS No.
157, “Fair Value
Measurements”, requires an entity to maximize the use of observable
inputs and minimize the use of unobservable inputs when measuring fair value.
SFAS No. 157 establishes a fair value hierarchy based on the level of
independent, objective evidence surrounding the inputs used to measure fair
value. A financial instrument’s categorization within the fair value hierarchy
is based upon the lowest level of input that is significant to the fair value
measurement. SFAS No. 157 prioritizes the inputs into three levels that may be
used to measure fair value:




Level
1




Level 1
applies to assets or liabilities for which there are quoted prices in active
markets for identical assets or liabilities.




Level
2




Level 2
applies to assets or liabilities for which there are inputs other than quoted
prices that are observable for the asset or liability such as quoted prices for
similar assets or liabilities in active markets; quoted prices for identical
assets or liabilities in markets with insufficient volume or infrequent
transactions (less active markets); or model-derived valuations in which
significant inputs are observable or can be derived principally from, or
corroborated by, observable market data.




Level
3




Level 3
applies to assets or liabilities for which there are unobservable inputs to the
valuation methodology that are significant to the measurement of the fair value
of the assets or liabilities.




The
Company’s financial instruments consist principally of cash, accounts payable
and accrued liabilities, and due to related party. Pursuant to SFAS No. 157, the
fair value of our cash equivalents is determined based on “Level 1” inputs,
which consist of quoted prices in active markets for identical assets. The
Company believes that the recorded values of all of the other financial
instruments approximate their current fair values because of their nature and
respective maturity dates or durations.




f)
            Income
      Taxes




Potential
benefits of income tax losses are not recognized in the accounts until
realization is more likely than not. The Company has adopted SFAS No. 109 “Accounting for Income Taxes”
as of its inception. Pursuant to SFAS No. 109, the Company is required to
compute tax asset benefits for net operating losses carried forward. The
potential benefit of net operating losses have not been recognized in these
financial statements because the Company cannot be assured it is more likely
than not it will utilize the net operating losses carried forward in future
years.




g)
            Foreign
      Currency Translation




The
Company’s functional and reporting currency is the United States dollar.
Monetary assets and liabilities denominated in foreign currencies are translated
in accordance with SFAS No. 52, “Foreign Currency
Translation”, using the exchange rate prevailing at the balance sheet
date. Gains and losses arising on settlement of foreign currency denominated
transactions or balances are included in the determination of income. Foreign
currency transactions are primarily undertaken in Canadian dollars. The Company
has not, to the date of these financials statements, entered into derivative
instruments to offset the impact of foreign currency fluctuations.




h)
            Revenue
      Recognition




The
Company will recognize revenue from the sale of gourmet seasonings in accordance
with Securities and Exchange Commission Staff Accounting Bulletin No. 104 (“SAB
104”), “Revenue Recognition in
Financial Statements.” Revenue will be recognized when the price is fixed
or determinable, persuasive evidence of an arrangement exists, the service is
performed, and collectability is reasonably assured.




i)
            Recently
      Issued Accounting Pronouncements




Certain
accounting pronouncements have been issued by the FASB and other standard
setting organizations which are not yet effective and have not yet been adopted
by the Company. The impact on the Company’s future financial statements from
adoption of these pronouncements is not expected to be material.





Note 3.
Product License
Agreement




On July
2, 2008, the Company (the “Licensee”) entered into a Product License Agreement
(“Agreement”) with Celestial Delights, a sole proprietorship company located in
Ontario Canada, and Neema Lakhani (Principal and together with Celestial
Delights, the “Licensor”) pursuant to which the Company agreed to license the
exclusive rights to market and distribute, in the United States, a line of
gourmet seasonings owned by the Licensor. The initial term of the Agreement is
for two years, and is renewable at the sole option of the Licensor for two
additional two-year terms upon 30 days written notice. The Agreement may be
further extended upon mutual agreement by both parties. The Company is to pay
$8,000 for the right to market, promote and distribute the gourmet seasonings,
and is to pay a royalty of ten percent (10%) of all gross sales for products
licensed. Ms. Lakhani is also the majority stockholder and former chief
executive officer of the Company.


F-8




The
$8,000 initial license fee, which was paid on October 31, 2008, was capitalized
on July 2, 2008 and is being expensed over the initial two year term of the
agreement.





Note 4.
Related Party
Transactions




As at
June 30, 2009, the Company is indebted to the former President of the Company
for $4,488 (2008 - $399). This amount is unsecured, non-interest bearing and has
no terms of repayment.




The
Company received services from its former president at no cost to the Company.
For accounting purposes, the estimated fair value of these donated services
($200 per month) was included in general and administrative expenses and
additional paid-in capital was increased by the same amounts. During the fiscal
period ended June 30, 2009, the Company expensed $2,400 (2008 - $200) for
donated services.




On June
2, 2008, the Company issued 56,000,000 shares of common stock to the former
President of the Company at $0.000125 per share for cash proceeds of
$7,000.




On
September 12, 2008, the Company filed a Registration Statement on Form S-1 with
the United States Securities and Exchange Commission, which was declared
effective on September 23, 2008, to register 33,120,000 shares for resale by
existing shareholders of the Company at a price of $0.00125 per share until such
time as the shares of the Company’s common stock start trading on the OTC
Bulletin Board or another exchange. The Company will not receive any proceeds
from the resale of shares of common stock by the selling
stockholders.





Note 5.
Income
Taxes




The
provision for (benefit from) income taxes differs from the amount computed by
applying the statutory United States federal income tax rate of 35% to income
(loss) before income taxes. The sources of the difference follow:





Year
      Ended
                  
                  
                  Period
      June 2, 2008
                    (Inception)
      to
                  
                  
                  Period
      June 2, 2008
                    (Inception)
      toJune
      30, 2009
                  
                  
                  June
      30, 2008
                  
                  
                  June
      30, 2009Expected
      tax at 35%
                  
                  $
                  (15,320
                  )
                  
                  $
                  (5,704
                  )
                  
                  $
                  (21,023
                  )Donated
      expenses
                  
                  
                  840
                  
                  
                  
                  70
                  
                  
                  
                  910Incorporation
      costsIncrease
      in valuation allowance
                  
                  
                  14,480
                  
                  
                  
                  5,634
                  
                  
                  
                  20,113Income
      tax provision
                  
                  $
                  .
                  
                  
                  $
                  -
                  
                  
                  $
                  -




Deferred
income taxes reflect the net tax effects of temporary differences between the
carrying amounts of assets and liabilities for financial reporting purposes and
the amounts used for income tax purposes. Deferred income taxes arise from
temporary differences in the recognition of income and expenses for financial
reporting and tax purposes. The significant components of deferred income tax
assets and liabilities are as follows:





June
      30,
                        
                        
                        June
      30,2009
                        
                        
                        2008Net
      operating loss carryforward
                        
                        $
                        20,113
                        
                        
                        $
                        5,634Valuation
      allowance
                        
                        
                        (20,113
                        )
                        
                        
                        (5,634
                        )Net
      deferred tax assets
                        
                        $
                        -
                        
                        
                        $
                        -




Based on
management’s present assessment, the Company has not yet determined it to be
more likely than not that a deferred tax asset of $20,113 at June 30, 2009
attributable to the future utilization of the net operating loss carryforward of
$57,467 will be realized. Accordingly, the Company has provided a 100% allowance
against the deferred tax asset in the financial statements. The Company will
continue to review this valuation allowance and make adjustments as appropriate.
The net operating loss carryforward expires $16,096 in 2028 and $41,371 in
2029.


F-9




Current
United States income tax laws limit the amount of loss available to offset
against future taxable income when a substantial change on ownership occurs.
 Therefore, the amount available to offset future taxable income may be
limited.





Note 6.
Subsequent
Events




On
September 21, 2009, Ms. Neema Lakhani resigned as Director, President, Chief
Executive Officer, Chief Financial Officer and the Company.




On
September 21, 2009, the Board of Directors of the Company appointed Mr. John J.
Lennon as President, Chief Executive Officer, Chief Financial Officer and
Secretary of the Company to fill the vacancy created by the resignation of Ms.
Lakhani.




The
Company has evaluated subsequent events through the filing date of this Form
10-K and has determined that there were no additional subsequent events to
recognize or disclose in these financial statements.


F-10