United States Securities and Exchange Commission Washington, D.C. 20549FORM 10-K  xANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED DECEMBER 31, 2010
ORoTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE 
SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM  TO  COMMISSION FILE NUMBER 0-14278 LEGACY WINE & SPIRITS INTERNATIONAL LTD. NEVADA91-1963840(STATE OF INCORPORATION)(I.R.S. ID) 35 South Ocean Avenue, Patchogue, New York, 11772 1-888-488-6882 Securities registered pursuant to Section 12(b) of the Act: COMMON STOCK    Pinksheets Securities registered pursuant to Section 12(g) of the Act: Common Stock, Par Value $.0001 (Title of Class) Securities registered pursuant to Section 12(b) of the Act:  None  Securities registered pursuant to Section 12(g) of the Act:  Common stock, $.0001 par value per share  Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. YesoNox  Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. oYesxNo  Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    oYesxNo  Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). oYesoNo  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 registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. o  Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer or a smaller reporting company. Large accelerated filer  o  Accelerated filer    o Non-accelerated filer    o   (Do not check if a smaller reporting company)                Smaller reporting company  x  Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).oYes    x  No  As of March 31, 2011, there were 50,875,385 shares of the issuer's $0.0001 par value common stock issued and outstanding.  Documents incorporated by reference:  None  1    Legacy Wine & Spirits International Ltd.FORM 10-K  For The Fiscal Year Ended December 31, 2010 INDEX  PART I 3 ITEM 1.    BUSINESS 6 ITEM 1A.  RISK FACTORS 6 ITEM 1B.  UNRESOLVED STAFF COMMENTS 6 ITEM 2.    PROPERTIES 6 ITEM 3.    LEGAL PROCEEDINGS 6 ITEM 4.    (REMOVED AND RESERVED) 7 PART II 7 ITEM 5.    MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES 7 ITEM 6.    SELECTED FINANCIAL DATA 7 ITEM 7.    MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 10 ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 11 ITEM 8.    FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA 12 ITEM 9.    CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS  ON ACCOUNTING AND FINANCIAL DISCLOSURE 29 ITEM 9A.  CONTROLS AND PROCEDURES 29 ITEM 9B.  OTHER INFORMATION 30 PART III 30 ITEM 10.    DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE 30 ITEM 11.    EXECUTIVE COMPENSATION 30 ITEM 12.    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS 32 ITEM 13.    CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND  DIRECTOR INDEPENDENCE 33 ITEM 14.    PRINCIPAL ACCOUNTING FEES AND SERVICES 33 PART IV 34 ITEM 15.    EXHIBITS AND FINANCIAL STATEMENT SCHEDULES 34 SIGNATURES 34   Note About Forward-Looking Statements  Certain statements in this report, other than purely historical information, including estimates, projections, statements relating to our business plans, objectives and expected operating results, and the assumptions upon which those statements are based, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements generally are identified by the words believe, project, expect, anticipate, estimate, intend, strategy, future, opportunity, plan, may, should, will, would, will be, will continue, will likely result, and similar expressions. Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties which may cause actual results to differ materially from the forward-looking statements. A detailed discussion of these and other risks and uncertainties that could cause actual results and events to differ materially from such forward-looking statements is included in the section entitled Risk Factors (refer to Part I, Item 1A). We undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.   2   PART I  ITEM 1.    BUSINESS  GENERAL  The following should be read in conjunction with our financial statements and the related notes that appear elsewhere in this quarterly report. The discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements.  Legacy Wine & Spirits International Ltd. (formerly Legacy Mining Ltd.) (Legacy or the Company) was incorporated on February 19, 1999 in the State of Nevada as Power Direct Tech.com.  On February 23, 1999, the Company changed its name to PD Tech.com and on June 8, 1999 the Company changed its name to Cardstakes.com to reflect managements decision to shift the Companys focus to internet-based business development. On January 13, 2004, the Company changed its name to Legacy Mining Ltd. to reflect managements decision to shift the Companys focus to mineral exploration and development. We also declared a one-for-two reverse stock split of all of the outstanding common stock, without any change in par value of the shares of common stock. Shareholder approval was obtained to affect the reverse stock split which became effective on January 30, 2004. The new CUSIP number for the Company is 5246EP 10 3.  On December 12, 2006, Legacy filed a Form SB-2 Registration Statement with the United States Security Commission. Following a number of amendments, the SB-2/A was declared effective on August 3, 2007. The trading symbol is LEYM.  On April 4, 2008, the Company held a Special Meeting whereby the Board of Directors, by unanimous consent, adopted, effective May 2, 2008, the following amendments to its Articles of Incorporation:  Name Change. A majority of the shareholders entitled to vote on such matters approved a change of name from Legacy Mining Ltd. to Legacy Wine & Spirits International Ltd. On April 8, 2008, a Certificate of Amendment to its Articles of Incorporation was filed with the State of Nevada changing the name to Legacy Wine & Spirits International Ltd.Change of Symbol and CUSIP Number.  The Company also took the necessary steps to change its symbol and CUSIP Number. Therefore, the CUSIP Number has changed from 5246EP 10 3 to 52470N 10 1. Following the review of the NASD and FINRA, the Company was given a new effective date for trading. Effective at the opening of business on May 27, 2008, the symbol changed from LEYM to LWSP.  On October 13, 2010, the Company was removed from the bulletin board to the pinksheets for failure to comply with Rule 15c2-11 whereby the frequency of market maker quotations did not meet the requirements of the Rule. The Company is taking the necessary steps to be in compliance with Rule 15c2-11 and be able to return to the OTC Bulletin Board for quotations in due course.  Our Wine & Spirits Operation  On May 28, 2008 Legacy Wine & Spirits International Ltd. reported that it had signed an agreement with Legacy Wine and Spirits Merchants Ltd (Legacy Merchants) a Hong Kong based Company, for the rights to a fifteen (15) year general license to import, bottle, blend, manufacture and distribute wine and spirits in China. Legacy Merchants received 1,000,000 shares of the Companys Rule 144 stock valued at $960,000 for the rights to the aforementioned license through its agreement with Beijing Nine Dragons Winery Development Co. Ltd (Nine Dragons) a China based company. Through Legacy Merchants and its agreement with Crown Star Holdings Ltd, an alcoholic beverage sourcing company with offices in Canada and Hong Kong, the Company has access to a wide selection of fine wine and spirits. The Companys initial plans were to open at least two (2) wine and spirits retail stores to be located in Beijing, China by September, 2008 for the distribution of its imported products.  3   Through a number of delays after the completion of the Beijing 2008 Olympics, the plan has changed. Legacy renovated one (1) 1,900 sq.ft. store in Tianjin, China completed in November, 2008. This store is named Legacy Wine and Spirits and has initially stocked imported red and white wines from choice regions throughout the world. This initial store will be a flagship model for a franchising plan designed to further broaden the Companys distribution facilities and gain further market awareness and penetration of the Legacy brand.  Once the Legacy retail stores have been established, the Company will exercise its First Right of Refusal to start-up its manufacturing facility in Beijing through Legacy Merchants agreement with Nine Dragons.  In the fourth quarter of 2010, the Company conducted an impairment analysis on the $1,025,100 attributed value of its intangible assets, including its license with Legacy Merchants valued at $960,000. These tests involved the use of estimates and assumptions appropriate in the circumstances in accordance with ASC 35-25-35:Subsequet measurement. In assessing fair value, valuation models were used that include discounted cash flows. The models use assumptions that include levels of growth in assets under management from net sales and market, pricing and margin changes, synergies achieved on acquisition, discount rates, and observable data for comparable transactions. This analysis of expected future cash flows determined that the sum of future expected cash flows does not exceed the respective net book value of the license and resulted in a write-down of the intangible asset in the amount of $872,225.(2009 - $Nil)  On June 24, 2008 Legacy Wine & Spirits International Ltd. reported that it had signed a Distribution Agreement with a Canadian based supplier of Italian wines, 2174684 Ontario Inc. This Agreement provided for the supply of select bottled wines at the mid-range price-point from six (6) different wine regions in Italy.  The Company was at this time in talks with distributors and wineries in both Spain and California with regards to a Distribution Agreement for wine supply from those parts. During the year ended December 31, 2008, the Company decided to terminate its distribution agreement with 2174684 Ontario Inc. and it was refunded its $45,000 advance.  Thereafter, the Company secured a relationship with Bronco Wine Company of California and purchased its initial inventory of nine varietals of wine on September 26, 2008 for the purchase price of $37,800. Subsequent to September 30, 2008, 1050 cases of wine were shipped to China and displayed for the opening of the first wine store in December 2008.  The Company has also incurred $10,000 in costs for sourcing of product and brands with wine & spirits manufacturers in China. As at December 31, 2010, the inventory totaled $20,551 (2009- $39,863).  Bronco Wine Company is the single largest private grape grower in the world with ownership of 17,000 hectares of wine grapes and five Californian wineries. Legacy is importing 750 ml bottled wines in several varietals of Bronco Winerys Hacienda Cellars Brand from Sonoma County, California. The Hacienda brand from Bronco Winery will include Merlot, Cabernet Sauvignon, Chardonnay, Sauvignon Blanc, Riesling, Gewurztraminer, Viognier, White Zinfandel and Brut Sparkling Wine. All wine varietals are aimed at the mid-price point and will be distributed and retailed in China via wholesale retailers and Legacys own outlet showroom which caters to the retail buyer as well, located in TEDA, Tianjin, a second tier city of over 10 million people just outside of Beijing  The Company has a three phase of business operation:  Phase One:  Legacy opened the initial corporately owned wine and spirits retail store in Tianjin, China in December, 2008.  This retail store was stocked with select, moderately priced imported wines and has served as the design and sales model for all franchise boutiques opened thereafter.  This phase enabled Legacy to  establish its brand name and retail stores through Point of Purchase marketing and taste appreciation gatherings.  In addition, this phase will enable Legacy to secure purchase orders from wholesale distributors for its Bottled Exclusively for Legacy wine and spirits line.  This phase moves the Company towards the establishment of the Legacy brand.   4   Phase Two:  Legacy has $85,000 reserved for leasehold improvements required to be made to future store locations. Additionally, the Company is currently  working towards leasing and renovating an additional existing wine and spirit store in China.  These stores are located in and around the Company's flagship store in Tianjin Economic Development Area (TEDA).which Legacy intends to have these operating in the 2011 year. The location of these stores were strategically chosen for logistic reasons since this will enable the current Legacy staff to move between each store implementing the protocol and standards that Legacy Stores will be known for in China. A Legacy Wine and Spirits store should signify a reliable place for locals or foreigners to purchase their alcohol of choice whether it be for gift giving or personal consumption. , Legacy's management feels that it will be advantageous to integrate these existing operating entities into a chain of Legacy retail outlets thus solidifying the Company's corporate branding.  This move will greatly expedite the Company's ability to distribute its inventory and increase its brand awareness in China. The proposed acquisition will enable Legacy to have the economy of scale working in their favor in terms of sales multiples and purchasing capabilities with wine and spirit suppliers and vendors. Through its agreement with Beijing Nine Dragons Winery Development Co. Ltd., Legacy will start importing select wine and spirits to be bottled in-house and distributed by the Company to Legacys retail outlets.  This phase will allow Legacy to increase its profit margin via lower shipping costs and taxes as well as wholesale price reductions. This phase is expected to begin in the third quarter of 2011.  Phase Three:  Legacy will begin the importing of select wine juice for the purpose of blending and manufacturing its own brand label wines and spirits.  This phase sees Legacy advance its market penetration, solidify its brand recognition and thus realize a further increase in its profit margin.  This phase is expected in the fourth quarter of 2011. Approximately 40 percent of imported wine enters China through Shanghai, so it is natural that the city has become the base for the majority of the leading distributors. Shanghai's specialty retail wine shops are a growing phenomenon in Shanghai and are unique alternatives to traditional state-owned tobacco and liquor shops and other retail outlets. These shops have found a niche in the retail market due to their unique marketing strategies, educational events, and store locations. From wine tasting parties and definitive flavor labels to wine and food matching seminars, these small specialty shops offer a growing and personalized introduction to imported wine. Legacy is expecting to join this market with its first wine outlet in Shanghai in 2011. The local partners currently buy wine from Legacy. According to statistics, Xiamen, the capital city of Fujian Province, reports annual consumption volumes of wine exceeding 10,000 liters, of which 45% are premium wines. Sales volumes have been increasing by 15% each year making Xiamen one of the key wine markets in China. In addition to strong local demand for wine, Xiamen also plays an important role as a wine distribution centre to neighboring areas such as Quanzhou, Fuzhou and Zhejiang in Jiangxi province. Legacy also intends to set up a joint venture in 2011 to aggressively enter the Xiamen market. Similar to Shanghai the local partners currently buy wine from Legacy. In doing business in China, Legacy is required to abide by the PRC laws and regulations regarding foreign ownership and certain requirements do effect our operations. A summary of these requirements appears below:  - A foreign corporation owing a Chinese subsidiary would normally have to maintain a certain balance at the bank  unless a Chinese citizen holds the subsidiary shares. The shares in Tianjin Legacy Wine Trading Co. Ltd. are held in trust by a Chinese citizen (Dennis Zhao, Manager) on behalf of Legacy.  5   - We have to remit taxes to the government not only at the point of receiving imported wine, but also on the sale of wine. - We have to pre-submit the labels to all wine being imported to China to the authorities so they can match them to the products when they arrive at Customs. - We have to have Chinese labeling done in China. - The Pudong bank account we maintain takes a 1% processing fee on all deposits under a certain amount. - We have to have an annual business license and health certificate. - The majority of suppliers in China have a policy that cash is the only acceptable form of payment.    ITEM 1A.    RISK FACTORS   Not applicable to smaller reporting companies  ITEM 1B.    UNRESOLVED STAFF COMMENTS  The Company has received a comment later dated February 17, 2011 from the United States Securities and Exchange Commission and is responding to the comments contained therein commensurate with the filing of the this Form 10K. The response letter is to be filed on April 15, 2011.  ITEM 2.    PROPERTIES  As of the dates specified in the following table, Wine & Spirits International Ltd. Held the following property in the following amounts:  Property  December 31, 2010  December 31, 2009 -------------------------------------------------------------------------------------------------------------------- Cash and equivalents US $ 3,665  US $ 6,743  Legacy Wine & Spirits International Ltd. defines cash equivalents as all highly liquid investments with a maturity of 3 months or less when purchased. Legacy Wine & Spirits International Ltd. does not presently own any interests in real estate. Legacy Wine & Spirits International Ltd. does presently own computer equipment with a net book value of $694 (2009  $990)  Facilities. As of August 1, 2010, the Company has leased 1250 sq. ft of office space from Holm Investments Ltd. at $2,500 per month for a period of 3 years. As of October 15, 2008, the Company has leased it wine store in Tianjin for a period of 10 years (renewable for an additional 5 yrs.), at $1,225 per month.   ITEM 3.    LEGAL PROCEEDINGS  None.   ITEM 4.    (REMOVED AND RESERVED)   6   PART II  ITEM 5.    MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES  As at December 31, 2010 there were approximately 2,000 holders of the outstanding shares of the Legacy Wine & Spirits International Ltd.'s $0.0001 par value common stock.  Legacy Wine & Spirits International Ltd. participates in the Pinksheets Electronic Quotation System maintained by the National Association of Securities Dealers, Inc., under the most recent trading symbol "LWSP". Legacy Wine & Spirits International Ltd. began trading October 30, 2007. According to quotes provided by quotemedia.com, the Legacy Wine & Spirits International Ltd.'s common stock has closed at:  Quarter  High  Low 2008 First Quarter $1.00 $0.64 2008 Second Quarter $1.05 $0.83 2008 Third Quarter $0.80 $0.51 2008 Fourth Quarter $0.93 $0.60 2009 First Quarter $0.83 $0.70 2009 Second Quarter $0.73 $0.25 2009 Third Quarter $0.48 $0.13 2009 Fourth Quarter $0.39 $0.08 2010 First Quarter $0.09 $0.03 2010 Second Quarter $0.06 $0.03 2010 Third Quarter $0.03 $0.02 2010 Fourth Quarter $0.05 $0.01  Such quotations reflect inter-dealer prices, without retail mark-up, mark-down or commission and may not represent actual transactions.  The public may read and copy any materials filed with the SEC at the SEC's Public Reference Room at 450 Fifth Street NW, Washington, D.C. 20549. The public may also obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC. The address of that site is http://www.sec.gov.  Common Stock. Legacy Wine & Spirits International Ltd. is authorized to issue 100,000,000 shares of common stock, $.0001 par value, each share of common stock having equal rights and preferences, including voting privileges. The shares of $.0001 par value common stock of Legacy Wine & Spirits International Ltd. constitute equity interests in Legacy Wine & Spirits International Ltd. entitling each shareholder to a pro rata share of cash distributions made to shareholders, including dividend payments.  As of December 31, 2010, 42,405,385 shares of the Legacy Wine & Spirits International Ltd.'s common stock were issued and outstanding.  The holders of Legacy Wine & Spirits International Ltd.'s common stock are entitled to one vote for each share of record on all matters to be voted on by shareholders. There is no cumulative voting with respect to the election of directors of Legacy Wine & Spirits International Ltd. or any other matter, with the result that the holders of more than 50% of the shares voted for the election of those directors can elect all of the Directors.   7   The holders of Legacy Wine & Spirits International Ltd.'s common stock have no conversion, preemptive or other subscription rights, and there are no redemption provisions applicable to Legacy Wine & Spirits International Ltd.'s common stock.  All of the outstanding shares of Legacy Wine & Spirits International Ltd.'s common stock are duly authorized, validly issued, fully paid and non-assessable.  Dividends. The holders of the Legacy Wine & Spirits International Ltd.'s common stock are entitled to receive dividends when, as and if declared by Legacy Wine & Spirits International Ltd.'s Board of Directors from funds legally available therefore; provided, however, that cash dividends are at the sole discretion of Legacy Wine & Spirits International Ltd.'s Board of Directors. In the event of liquidation, dissolution or winding up of Legacy Wine & Spirits International Ltd., the shareholders of common stock are entitled to share ratably in all assets remaining available for distribution to them after payment of liabilities of Legacy Wine & Spirits International Ltd. and after provision has been made for each class of stock, if any, having preference in relation to Legacy Wine & Spirits International Ltd.'s common stock.  Legacy Wine & Spirits International Ltd. has never declared or paid any dividends on its common stock.  Legacy Wine & Spirits International Ltd. does not intend to declare or pay any dividends in the foreseeable future.  Sales of Securities The Companys capitalization is 100,000,000 common shares with a par value of $0.0001 per share. 2010 Transactions On January 20, 2010 the Company issued 200,000 restricted common shares with a fair value of $14,000 to a consultant for his current services.  During the year ended December 31, 2010 the Company issued 12,882,500 shares under the Companys 2010 & 2009 Employee Stock Option Incentive Plans with a value of $301,950 for satisfaction of debt to related parties and $100,250 for certain other management and consulting services.  On May 26, 2010, the Company issued 1,500,000 restricted common shares with a fair value of $60,000 pursuant to deferred compensation agreements and on December 31, 2010, the Company issued 1,000,000 restricted common shares with a fair value of $20,000 pursuant to deferred compensation agreements.  During the year ended December 31, 2010 the Company issued 2,627,440 restricted common shares to settle a debt in the amount of $131,372 to Golden Spirit Enterprises Ltd. and issued 1,451,360 restricted common shares to settle a debt in the amount of $72,568 to Organa Gardens International Inc., both companies with directors in common. 2009 Transactions On January 22, 2009 the Company issued 400,000 restricted common shares with a fair value of $240,000 pursuant to deferred compensation agreements.  On April 20, 2009 the Company issued 13,000 restricted common shares with a fair value of $7,930 in exchange for services.  On November 10, 2009 the Company issued 15,000 restricted common shares with a fair value of $1,950 in exchange for services.  During the year ended December 31, 2009, the Company issued 1,375,000 shares under the Companys 2009 & 2008 Employee Stock Option Incentive Plans with a value of $192,300 for satisfaction of debt to related parties and 345,000 shares for cash proceeds of $51,300.   8   2010 Stock Options During the year ended December 31, 2010 the Company issued 12,882,500 shares under the Companys 2010 & 2009 Employee Stock Option Incentive Plans with a value of $301,950 for satisfaction of debt to related parties and $100,250 for certain other management and consulting services.  The Companys stock option activity is as follows:  Number of optionsWeighted Average Exercise PriceWeighted Average Remaining Contractual LifeBalance, December 31, 2008---Granted during the period1,720,0000.25-Exercised during the period( 1,720,000)0.25-Balance, December 31, 2009-$                --Granted during the period12,882,5000.03-Exercised during the period(12,882,500)0.03-Balance, December 31, 2010-$                -- As of December 31, 2010 there were Nil stock options available for grant under the Companys 2008 and 2009 Stock Incentive and Option Plans. On February 9, 2010, the Company filed Registration Statements on Form S-8 to register 9,000,000 to be issued pursuant to the Companys 2010 Stock Incentive and Option Plan. As of December 31, 2010 there were 1,015,000 stock options available for grant under the Companys 2010 Stock Incentive and Option Plan  2009 Stock Options During the year ended December 31, 2009, the Company granted a total of 1,720,000, 5 year common stock options at various prices between $0.06 - $0.45 per share, of which 1,375,000 were exercised immediately in satisfaction of debts to related parties in the amount of $192,300. The Company recognized stock-based compensation of $19,350, which represented the fair value of the remaining 345,000 stock options granted to consultants.  The Company received cash proceeds of $51,300 on the exercise of the 345,000 stock options.  The Companys stock option activity is as follows: Number of optionsWeighted Average Exercise PriceWeighted Average Remaining Contractual LifeBalance, December 31, 2007-$                     --Granted during 2008162,5000.60-Exercised during 2009(162,500)0.60-Balance, December 31, 2008---Granted during the period1,720,0000.25-Exercised during the period( 1,720,000)0.25-Balance, December 31, 2009-$                --  As of December 31, 2009, there were 587,500 stock options available for grant under the Companys 2008 Stock Incentive and Option Plan.    9   On June 5, 2009, the Company filed Registration Statements on Form S-8 to register 6,000,000 to be issued pursuant to the Companys 2009 Stock Incentive and Option Plan. As of December 31, 2009, there were 4,310,000 stock options available for grant under the Companys 2009 Stock Incentive and Option Plan.   ITEM 6.    SELECTED FINANCIAL DATA  Fiscal Year Ended December 302010200920082007Revenue$        29,571$45,453$         2,055$             NilOperating Loss(1,545,596)(568,263)(505,183)(100,657)Net Loss(1,536,607)(568,263)(668,369)(100,657)Basic net loss per share0.05030.0301Cash dividends declared per share----Cash, cash equivalents,  and short-term investments3,6656,74313,4326,014Total assets227,1011,205,3951,315,6149,952Long-term obligations----Stockholders equity (deficit)129,710936,293495,6551,922,877   ITEM 7.    MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS  This following information specifies certain forward-looking statements of management of the company. Forward-looking statements are statements that estimate the happening of future events are not based on historical fact. Forward-looking statements may be identified by the use of forward-looking terminology, such as "may", "shall", "will", "could", "expect", "estimate", "anticipate", "predict", "probable", "possible", "should", "continue", or similar terms, variations of those terms or the negative of those terms.  The forward-looking statements specified in the following information have been compiled by our management on the basis of assumptions made by management and considered by management to be reasonable. Our future operating results, however, are impossible to predict and no representation, guaranty, or warranty is to be inferred from those forward-looking statements.  The assumptions used for purposes of the forward-looking statements specified in the following information represent estimates of future events and are subject to uncertainty as to possible changes in economic, legislative, industry, and other circumstances. As a result, the identification and interpretation of data and other information and their use in developing and selecting assumptions from and among reasonable alternatives require the exercise of judgment. To the extent that the assumed events do not occur, the outcome may vary substantially from anticipated or projected results, and, accordingly, no opinion is expressed on the achievability of those forward-looking statements. No assurance can be given that any of the assumptions relating to the forward-looking statements specified in the following information are accurate, and we assume no obligation to update any such forward-looking statements.   Liquidity and Capital Resources.  For the year ended December 31, 2010, we had total assets of $227,101, compared to total assets in 2009 of $1,205,395. This includes a cash balance of $3,665, compared to $6,743 in 2009.  We also have inventory of $20,551 and prepaid expenses of $5,171.  We had $101,520 invested in leasehold improvements, $85,000 on deposit for future leasehold improvements, intangible assets of $10,500 and $694 in furniture and fixtures.  At December 31, 2010, we had current liabilities of $97,391, which was represented by accounts payable and accrued liabilities of $57,779 and $39,612 total due to related parties. At December 31, 2009 we had current liabilities of $269,102. The decrease in liabilities was due to a debt settlement with Golden Spirit Enterprises Ltd. and Organa Gardens International Inc of $204,063 which was offset by an increase in amounts due to other related parties.  At December 31, 2010, we had a working capital deficiency of $68,004 (2009 deficiency- $211,625).  We do not believe that our current cash resources will be able to maintain our current operations for an extended period of time. We will be required to raise additional funds or arrange for additional financing over the next 12 months to adhere to our development schedule.  No assurance can be given, however, that we will have access to additional cash in the future, or that funds will be available on acceptable terms to satisfy our working capital requirements. If we are not able to arrange for additional funding or if our officers, directors and shareholders stop advancing funds to us, we may be forced to make other arrangements for financing such as loans or entering into strategic alliances. We have not identified any alternative sources of financing.  10     Results of Operations  We had $77,079 in revenues from operations from inception to December 31, 2010. During the year ended December 31, 2010 we recognized a net operating loss totaling $1,536,307 (2009 - $568,263).  This increase in loss was due to the write-down of intangible assets  liquor license of $872,225.  From inception to December 31, 2010 our Company has incurred cumulative net losses of $4,597,828, resulting primarily from the write-down of certain internet related activities we were previously involved in. These included a write-down of a proprietary internet technology license in the amount of $912,653, a write-down of URLs acquired in the amount of $247,500, a write-down of website development costs in the amount of $158,772, and a write-down of intangible assets liquor license of $872,225; management and consulting fees of $1,188,531; travel and accommodation of $128,143; office and general expenses of $479,829 professional fees of $384,175; depreciation and amortization expense of $192,846 and exploration costs of $17,214.  The cash and equivalents constitute our present internal sources of liquidity. Because we are not generating  significant revenues as of yet our only external source of liquidity is the sale of our capital stock and any advances from officers, directors or shareholders.  Our Plan of Operation for the Next Twelve Months  We do anticipate that we will need to raise additional capital within the next 12 months in order to continue as a going concern. To the extent that additional capital is raised through the sale of equity or equity- related securities, the issuance of such securities could result in dilution of our stockholders.  There can be no assurance that additional funding will be available on favorable terms, if at all.  If adequate funds are not available within the next 12 months, we may be required to curtail our operations significantly or to obtain funds through entering into arrangements with collaborative partners or others that may require us to relinquish rights to certain of our assets that we would not otherwise relinquish.  Legacy Wine & Spirits International Ltd. does anticipate some expenditures within the next 12 months for its expanding wine operations in China.  Legacy Wine & Spirits International Ltd. does not anticipate any further significant exploration costs within the next 12 months, nor does Legacy Wine & Spirits International Ltd. anticipate that it will lease or purchase any significant equipment within the next 12 months.   ITEM 7A.   QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK  None   11    ITEM 8.    FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA  REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM  To the Board of Directors and Stockholders Legacy Wine & Spirits International Ltd. Patchogue, New York  We have audited the accompanying consolidated balance sheets of Legacy Wine & Spirits International Ltd. (formerly Legacy Mining Ltd.) (a development stage company) as of December 31, 2010 and 2009, and the related consolidated statements of operations, stockholders equity , and cash flows for each of the years in the two year period ended December 31, 2010 and for the cumulative period from February 19, 1999 (inception) to December 31, 2010. Legacy Wine & Spirits International Ltd.s management is responsible for these statements. Our responsibility is to express an opinion on these financial statements based on our audits.  We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States).Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.  The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.  Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Companys internal control over financial reporting.  Accordingly, we express no such opinion.  An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements.  An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.  We believe that our audits provides a reasonable basis for our opinion.  In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Legacy Wine & Spirits International Ltd. as of December 31, 2010 and 2009, and the results of its activities and cash flows for each of the years in the two year period ended December 31, 2010 and for the cumulative period from February 19, 1999 (inception) to December 31, 2010 in conformity with accounting principles generally accepted in the United States of America.  The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Companys current liabilities exceed current assets, has incurred significant losses since inception, all of which raise substantial doubt about the Companys ability to continue as a going concern.  Managements plans in regards to these matters are also described in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.   /s/ L.L. Bradford & Company, LLC  Las Vegas, Nevada April 15, 2011    12   LEGACY WINE & SPIRITS INTERNATIONAL LTD. (A development stage Company) CONSOLIDATED BALANCE SHEETS  December 31,
2010December 31,
2009ASSETSCURRENT ASSETSCash$             3,665$               6,743Inventory, at cost20,55139,863Prepaid  Expenses5,17110,871TOTAL CURRENT ASSETS29,38757,477DEPOSIT ON LEASEHOLD IMPROVEMENTS85,00085,000LEASEHOLD IMPROVEMENTS, net of depreciation of $17,986 (2009 - $8,643)101,520110,863FURNITURE AND FIXTURES, net of depreciation of $32,537 (2009 - $32,537)694990OTHER INTANGIBLE ASSETS,net of write-down of $872,225 (2009 - $Nil) and amortization of $142,375 (2009 - $74,035)10,500951,065TOTAL ASSETS$        227,101$         1,205,395LIABILITIES AND STOCKHOLDERS EQUITYCURRENT LIABILITIESAccounts payable and accrued liabilities$          57,779$             55,890Due to Golden Spirit Enterprises Ltd.-72,691Due to Organa Gardens International Inc.-131,372Due to related parties39,6129,149TOTAL CURRENT LIABILITIES97,391269,102STOCKHOLDERS EQUITYCommon stock, $.0001 par value, 100,000,000 shares authorizedIssued and outstanding: 42,405,385 (2009  22,704,085) common shares4,2412,275Additional paid-in capital5,173,2134,485,039Deferred Compensation(60,416)(100,000)Deficit accumulated during the development stage(4,987,328)(3,451,021)TOTAL STOCKHOLDERS EQUITY129,710936,293TOTAL LIABILITIES AND STOCKHOLDERS EQUITY$       227,101$      1,205,395  The accompanying notes are an integral part of these consolidated financial statements  13    LEGACY WINE & SPIRITS INTERNATIONAL LTD. (A development stage company) CONSOLIDATED STATEMENTS OF OPERATIONS Year
ended
December 31, 2010Year
ended
December 31, 2009Cumulative results of operations from February, 19 ,1999 (inception) to December 31,2010REVENUESWine sales$         29,571$        45,453$             77,079COST OF GOOD SOLD20,28227,36348,319GROSS PROFIT9,28918,09028,760GENERAL AND ADMINISTRATIVE EXPENSESWine promotions-4983,233Store supplies2221,8643,623Advertising-509757Property Tax133-2,095Investor Relations59,97262,500132,472Consulting283,521243,948957,331Depreciation and Amortization77,27176,688192,846Exploration costs--17,214Management fees100,000-231,200Office and general63,01584,959479,829Professional fees54,03673,112384,175Travel and accommodation19,56714,009128,143Wages and salaries15,63428,266127,543Website development costs--158,772Write-down of liquor license872,225-872,225Write-down of technology license--912,653Write-down of URLs--247,500TOTAL EXPENSES1,545,596586,3534,821,061OTHER INCOME (EXPENSES)Property Option Loss--(15,500)Interest on settlement of due to related parties--(149,337)TOTAL OTHER INCOME (EXPENSES)--(164,837)Loss before Income Taxes(1,536,607)(568,263)(4,987,328)Income Tax Provision--NET LOSS$  (1,536,607)$     (568,263)$  (4,987,328)BASIC AND DILUTED INCOME LOSS PER SHARE$          (0.05)$             (0.03)WEIGHTED AVERAGE COMMON
    SHARES OUTSTANDING -  BASIC AND DILUTED31,813,71521,243,869  The accompanying notes are an integral part of these consolidated financial statements.   14   LEGACY WINE & SPIRITS INTERNATIONAL LTD. (A development stage company) CONSOLIDATED STATEMENT OF STOCKHOLDERS EQUITY (DEFICIT)  PERIOD FROM FEBRUARY 19, 1999 (INCEPTION) TO DECEMBER 31, 2010 Number of sharesAmountAdditional paid-in capitalCommon stock to be issuedDeficit accumulated during the exploration stageTotalBalance, February 19, 1999-$          -$            -$            -$                -$                -March 30, 1999  Shares issued for cash @ $0.201,050,000105209,895--210,000June 15, 1999 to September 15, 1999 - Shares issued for licensing agreement @ $0.204,563,446456912,198--912,654July 7, 1999  Shares issued for services @ $0.20250,0002549,975--50,000Net loss  from inception to December 31, 1999----(988,882)(988,882)Balance, December 31, 19995,863,4465861,172,068-(988,882)183,772Net loss----(614,401)(614,401)Balance, December 31, 20005,863,4465861,172,068-(1,603,283)(430,269)Net loss----(207,381)(207,381)Balance, December 31, 20015,863,4465861,172,068-(1,810,664)(638,010)Net loss----(62,334)(62,334)Balance, December 31, 20025,863,4465861,172,068-(1,872,998)(700,344)December 31, 2003 - Common shares to be issued229,988-229,988Net loss----(64,461)(64,461)Balance, December 31, 20035,863,4465861,172,068229,988(1,937,459)(534,817)February 18, 2004  Shares issued for debt settlement @ $0.025,300,000530105,470(106,000)--February 18, 2004  Shares issued for debt settlement @ $0.021,229,880123122,865(122,988)--February 27, 2004  Shares issued for property @ $0.02100,000101,990(1,000)-1,000Share reconciliation after reverse split(4)-----Net loss(52,637)(52,637)Balance, December 31, 200412,493,3221,2491,402,393-(1,990,096)(586,454)  The accompanying notes are an integral part of these consolidated financial statements.   15    LEGACY WINE & SPIRITS INTERNATIONAL LTD. (A development stage company) CONSOLIDATED STATEMENT OF STOCKHOLDERS DEFICIT PERIOD FROM FEBRUARY 19, 1999 (INCEPTION) TO DECEMBER 31, 2010 Number of sharesAmountAdditional paid-in capitalDeferred CompensationDeficit accumulated during the exploration stageTotalBalance forward, January 1, 200512,493,3221,2491,402,393-(1,990,096)(586,454)December 17,2005  Shares issued for property @$0.02750,000757,425--7,500Donated capital--437,530--437,530Net loss----(45,681)(45,681)Balance, December 31, 200513,243,3221,3241,847,348-(2,035,777)(187,105)September 5, 2006  Shares  for debt @ $0.023,855,180385192,374192,759Net loss----(77,685)(77,685)Balance, December 31, 200617,098,5021,7092,039,722-(2,113,462)(72,031)September 4, 2007  Shares issued for initial public offering @ $0.051,000,00010049,900--50,000Net loss----(100,657)(100,657)Balance, December 31, 200718,098,502$      1,809$ 2,089,622-$ (2,214,119)$  (122,688)February 27, 2008  Shares  for services @ $0.6525,000316,247--16,250May 27, 2008  Shares issued for debt @ $0.50294,08329147,012--147,041- Interest portion of debt settlement132,337--132,337June 12, 2008  Shares issued for cash @ $0.50920,00092459,908--460,000June 13, 2008  Shares issued for license @ $0.961,000,000100959,900--960,000August 19, 2008  Shares issued for debt @ $0.5085,000942,491--42,500- Interest portion of debt settled--17,00017,000September 16, 2008  Shares for services @ $0.515,00012,549--2,550October 7, 2008  Shares issued for cash @ $0.506,00012,999--3,000October 22, 2008  Shares issued options @ $0.60162,5001697,484--97,500Stock based compensation--4,875--4,875Shares to be issued for services @ $0.60---(20,000)-(20,000)Net loss---(668,639)(668,639)Balance, December 31, 200820,596,085$    2,060$3,972,424$    20,000$(2,882,758)$ 1,111,726  The accompanying notes are an integral part of these consolidated financial statements   16    LEGACY WINE & SPIRITS INTERNATIONAL LTD. (A development stage company) CONSOLIDATED STATEMENT OF STOCKHOLDERS DEFICIT PERIOD FROM FEBRUARY 19, 1999 (INCEPTION) TO DECEMBER 31, 2010  Number of sharesAmountAdditional paid-in capitalDeferred CompensationDeficit accumulated during the exploration stageTotal January 22, 2009  Shares issued for deferred
compensation @ $0.60.400,00040239,960(240,000)--April 20, 2009  Shares issued for services @ $0.6113,00017,929--7,930June 8, 2009  Shares issued for options  @ $0.45 for
cash proceeds.30,000313,497--13,500July 7, 2009  Shares issued for options @ $0.35 for debt settlement.200,0002069,980--42,500-August 10, 2009  Shares issued for options @ $0.42
for debt settlement.110,0001146,189--46,200September 17, 2009  Shares issued for options @ $0.14 for devt settlement.50,00056,995--7,000October 6, 2009  Shares issued for options @ $0.12
for cash proceeds.15,00021,798--1,800October 28, 2009  Shares issued for options @ $0.12 for cash proceeds.300,0003035,970--36,000November 10, 2009  Shares  for services @ $0.1315,00021,948--1,950November 12, 2009  Shares issued for options @ $0.13 for debt settlement.38,00044,936--4,940November 25, 2009-Shares issued for options
@ $0.08 for debt settlement.
.77,00076,153--6,160December 16, 2009- Shares issued for options
@ $0.07 for debt settlement.400,0004027,960--28,000December 30 ,2009-Shares issued for options @$0.06 for debt settlement.500,0005029,950--30,000Deferred compensation expense---120,000-120,000Stock based compensation--19,350--19,350Net loss---(568,263)(568,263)Balance, December 31, 200922,744,085$    2,275$ 4,485,039$  (100,000)$ (3,451,021)$ 936,293  17 Number of sharesAmountAdditional paid-in capitalDeferred CompensationDeficit accumulated during the exploration stageTotalJanuary 20, 2010 Shares issued forservices @ $0.07200,0002013,98014,0000January 25, 2010 Shares issued for options @ $0.06345,0003420,66620,700February 4, 2010 Shares issued for options @ $0.052,000,00020099,800100,000March 9, 2010 Shares issued for options @ $0.04850,0008533,91534,000March 24, 2010 Shares issued for options @ $0.033,000,00030089,70090,000April 13, 2010 Shares issued for options @ $0.03300,000308,9709,000April 15, 2010 Shares issued for options @ $0.031,000,00010029,90030,000May 12, 2010 Shares issued for options @ $0.0375,00082,2422,250May 26, 2010 Shares issued for deferred compensation @$.041,500,00015059,850(60,000)-August 12, 2010 Shares issued for options @ $0.023,550,00035570,64571,000October 27, 2010 Shares issued for options @ $0.02150,000152,9853,000November 24, 2010 Shares issued for options @ $0.021,612,50016132,08932,250December 4, 2010 Shares issued for debt settlement @$0.054,078,800408203,532203,940December 31, 2010 Shares issued for deferred compensation at $0.021,000,00010019,900(20,000)-Deferred compensation expense119,584119,584Stock based compensation--Net Loss(1,536,307)(1,536,307)Balance December 31, 201042,405,385$4,241$5,173,213$(60,416)$(4,987,328)$129,710  The accompanying notes are an integral part of these consolidated financial statements   18   LEGACY WINE & SPIRITS INTERNATIONAL LTD. (A development stage company)  CONSOLIDATED STATEMENTS OF CASH FLOWS  Year ended December 31, 2010Year ended December 31, 2009Cumulative results of operations from February 19, 1999 (inception) to December 31, 2010CASH FLOWS FROM OPERATING ACTIVITIESNet loss$(1,536,307)$   (568,263)$   (4,987,328)Adjustments to reconcile net loss to net cash
(used in) operating activities:-depreciation and amortization77,27176,688192,486- fees and services paid with shares and options236,584149,230479,489- interest on settlement of due to related parties--149,337- non-cash exploration costs--9,500- write-down of liquor license872,225-872,225- write down of technology license--912,654- write off of website development costs--158,772- write down of URLs--247,500- net changes in other working capital items7,58920,590502,244- inventory19,31226,219(20,551)NET CASH FLOWS (USED IN) OPERATING ACTIVITIES(323,326)(295,536)(1,483,672)CASH FLOWS FROM INVESTING ACTIVITIESAcquisition of furniture and equipment--(24,317)Deposit on Leasehold improvements--(85,000)Leasehold improvements--(119,505)Website development costs-(223,872)NET CASH FLOWS USED IN INVESTING ACTIVITIES--(452,694)CASH FLOWS FROM FINANCING ACTIVITIESNet advances (to) from related parties320,248237,5471,068,231Proceeds on sale of common stock-51,300871,800NET CASH FLOWS PROVIDED BY FINANCING ACTIVITIES320,248288,8471,940,031NET (DECREASE) INCREASE IN CASH(3,078)(6,689)3,665CASH, BEGINNING OF YEAR6,74313,432-CASH, END OF YEAR$         3,665$         6,743$             3,665 The accompanying notes are an integral part of these consolidated financial statements.   19    LEGACY WINE & SPIRITS INTERNATIONAL LTD. (A development stage company) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2010 and 2009  NOTE 1  NATURE OF OPERATIONS AND BASIS OF PRESENTATION  Legacy Wine & Spirits International Ltd. (formerly Legacy Mining Ltd.) (Legacy or the Company) was incorporated on February 19, 1999 in the State of Nevada as Power Direct Tech.com.  On February 23, 1999, the Company changed its name to PD Tech.com and on June 8, 1999 the Company changed its name to Cardstakes.com to reflect managements decision to shift the Companys focus to internet-based business development.  On January 13, 2004, the Company changed its name to Legacy Wine & Spirits International Ltd. to reflect managements decision to shift the Companys focus to mineral exploration and development. In 2007, the Company filed a Registration Statement Form SB-2/A to become a fully reporting Company on the OTC: BB and on October 30, 2007, began trading under the symbol LEYM. In 2008, due to uncertainties in the financing of mineral exploration and development, management decided to shift the Company focus to the wine & spirits industry. On May 2, 2008, the Company changed its name to Legacy Wine & Spirits International Ltd. and on May 27, 2008, the Company began trading under the symbol LWSP. Going concern  These financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America applicable to a going concern which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business.  The Company is an development stage company and its general business  is the operation of a wine store in Tianjin, China.. The Company will depend almost exclusively on outside capital through the issuance of common shares to finance ongoing operating losses and to fund the wine operations The Company has incurred losses of $4,987,328 from inception to December 31, 2010 and has a working capital deficiency of $68,004. The ability of the Company to continue as a going concern is dependent on raising additional capital and ultimately on generating future profitable operations.  There can be no assurance that the Company will be able to raise the necessary funds when needed to finance its ongoing costs.  The Company's future capital requirements will depend on many factors, including cash flow from operations, costs to complete property development, if warranted, and competition and global market conditions.  The Company's anticipated recurring operating losses and growing working capital needs will require that it obtain additional capital to operate its business.  Given the Company's limited operating history, lack of revenues, and its operating losses, there can be no assurance that it will be able to achieve or maintain profitability.  Accordingly, these factors raise substantial doubt about the Companys ability to continue as a going concern. NOTE 2  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation The financial statements include the accounts of the Company and its subsidiary, a 100% interest in Tianjin Legacy Wine Trading Co. Ltd.  All significant intercompany transactions and balances have been eliminated in consolidation.  Basis of Presentation The accompanying consolidated financial statements are presented In United States dollars and are prepared in accordance with accounting principles accepted in the United States.   20   Use of Estimates and Assumptions Preparation of the Companys financial statements in conformity with United States generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures.  Accordingly, actual results could differ from those estimates. Equipment Equipment is carried at acquisition cost less accumulated depreciation. Depreciation is provided over the estimated useful lives of the assets on a straightline basis. Leasehold Improvements Leasehold Improvements is carried at acquisition cost less accumulated depreciation. Depreciation is provided over the shorter of the lease term, which generally includes reasonably assured option periods, or the estimated useful lives of the assets on straight line basis per annum. Intangible Assets Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 350 , Intangibles-Goodwill and Other requires that goodwill and intangible assets with indefinite useful lives no longer be amortized, but instead tested for impairment at least annually in accordance with the provisions of ASC 350. This standard also requires that intangible assets with definite useful lives be amortized over their respective estimated useful lives to their estimated residual values, and reviewed for impairment. The Company's intangible assets consist of the acquisition of the license to import and distribute wine & liquor products and various brands and labels. The Company determined that the intangibles have an estimated useful life of 15 years and will be reviewed annually for impairment. Amortization will be recorded over the estimated useful life of the assets using the straight-line method for financial statement purposes. The Company commenced amortization when the economic benefits of the assets begin to be consumed in December 2008. Other intangibles are carried at acquisition cost less accumulated amortization. Amortization is provided over the estimated useful lives of the assets on straight line basis per annum.  Definite life intangible assets are tested for recoverability whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable. These tests involve the use of estimates and assumptions appropriate in the circumstances. In assessing fair value, valuation models are used that include discounted cash flows. The models use assumptions that include levels of growth in assets under management from net sales and market, pricing and margin changes, synergies achieved on acquisition, discount rates, and observable data for comparable transactions. As of December 31, 2010, the Company believes there is an impairment of its intangible assets and has recorded a write-down in the value of the intangible in the amount of $872,225. Concentration of Credit Risk Cash in bank accounts is at risk to the extent that it exceeds U.S. Federal Deposit Insurance Corporation and Canadian Deposit Insurance Corporation insured amounts. To minimize risk, the Company places its cash with high credit quality institutions. All cash for the U.S. Corporation is deposited in one prominent Canadian financial institution and the Chinese Subsidiary maintains a bank account with a prominent Chinese financial institution. Fair Value of Financial Instruments The estimated fair value amounts have been determined by the Company, using available market information and appropriate valuation methodologies.  The fair value of financial instruments classified as current assets or liabilities, including cash, notes receivable, accounts payable, and amounts due to related parties approximate their carrying value due to the short-term maturity of the instruments.  Foreign Currency Translation The financial position and results of operations of the Tianjin Wine Trading Co. Ltd. operations are measured using the parents currency as the functional currency. Non monetary assets and liabilities of these operations are translated at the exchange rate in effect at the transaction date. Monetary assets and liabilities of these operations are translated at the exchange rate in effect at the balance sheet date. Income statement accounts, with the exception of amortized assets or liabilities, are translated at the average exchange rate during the period.  Translation adjustments arising from the use of  differing exchange rates from period to period are included in exchange gain or loss in the income statement. Gains and losses that result from foreign currency transactions are included in the calculation of net income (loss).   21     Inventory  Inventory is recorded at the lower of cost or net realizable value.  Revenue Recognition  Sales are recognized upon purchase by customers at our retail store. All sales at our retail store are final, allowing for no sales returns.  Income Taxes  The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date.  The Company records net deferred tax assets to the extent the Company believes these assets will more likely than not be realized. In making such determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax planning strategies and recent financial operations. A valuation allowance is established against deferred tax assets that do not meet the criteria for recognition. In the event the Company were to determine that it would be able to realize deferred income tax assets in the future in excess of their net recorded amount, the would make an adjustment to the valuation allowance which would reduce the provision for income taxes.  The Company follows the accounting guidance which provides that a tax benefit from an uncertain tax position may be recognized when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, based on the technical merits. Income tax positions must meet a more-likely-than-not recognition threshold at the effective date to be recognized initially and in subsequent periods. Also included is guidance on measurement, derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. Stock-Based Compensation  The Company accounts for all compensation related to stock, options or warrants using a fair value based method whereby compensation cost is measured at the grant date based on the value of the award and is recognized over the service period, which is usually the vesting period. The Company uses the Black-Scholes pricing model to calculate the fair value of options and warrants issued to both employees and non-employees. Stock issued for compensation is valued using the market price of the stock on the date of the related agreement.  Comparative figures  Certain comparative figures have been reclassified in order to conform to the current year's financial statement presentation  Recent Accounting Pronouncements  In January 2010, the FASB issued ASU No. 2010-06 :Fair Value Measurements and Disclosure (Topic 820) regarding fair value measurements and disclosures and improvement in the disclosure about fair value measurements.  This ASU requires additional disclosures regarding significant transfers in and out of Levels 1 and 2 of fair value measurements, including a description of the reasons for the transfers.  Further, this ASU requires additional disclosures for the activity in Level 3 fair value measurements, requiring presentation of information about purchases, sales, issuances, and settlements in the reconciliation for fair value measurements.  This ASU is effective for fiscal years beginning after December 15, 2010, and for interim periods within those fiscal years.  We are currently evaluating the impact of this ASU, however, we do not expect the adoption of this ASU to have a material impact on our consolidated financial statements.    22   In July 2010, the FASB issued ASU No. 2010-20, Receivables (Topic 310):  Disclosures about the Credit Quality of Financing Receivables and the Allowance for Credit Losses.  The ASU amends FASB Accounting Standards Codification Topic 310, Receivables, to improve the disclosures that an entity provides about the credit quality of its financing receivables and the related allowance for credit losses.  As a result of these amendments, an entity is required to disaggregate, by portfolio segment or class of financing receivables, certain existing disclosures and provide certain new disclosures about its financing receivables and related allowance for credit losses.  This ASU is effective for interim and annual reporting periods ending on or after December 15, 2010.  The adoption of this standard may require additional disclosures, but we do not expect the adoption to have a material effect on our consolidated financial statements.  On December 21, 2010, the FASB issued Accounting Standards Update (ASU) 2010-29:Business Combinations (Topic 805), which impacts any public entity that enters into business combinations that are material on an individual or aggregate basis. The guidance specifies that if a public entity presents comparative financial statements, the entity should disclose revenues and earnings of the combined entity as though the business combination(s) that occurred during the year had occurred at the beginning of the prior annual period when preparing the pro forma financial information for both the current and prior reporting periods. The guidance also requires that pro forma disclosures be accompanied by a narrative description regarding the nature and amount of material, nonrecurring pro forma adjustments directly attributable to the business combination included in reported pro forma revenues and earnings. This guidance is effective for business combinations consummated in periods beginning after December 15, 2010.  We do not believe the adoption of this guidance will have a material impact on our Consolidated Financial Statements.  is designed to simplify U.S. GAAP into a single, topically ordered structure.  All guidance contained in the Codification carries an equal level of authority.  The Codification is effective for interim and annual periods ending after September 15, 2009.  Accordingly, the Company refers to the Codification in respect of the appropriate accounting standards throughout this document as FASB ASC.  Implementation of the Codification did not have any impact on the Companys consolidated financial statements.  NOTE 3  DEPOSITS ON LEASEHOLD IMPROVEMENTS  The Company opened its first wine and spirits retail store located in Tianjin, China in December, 2008 for the distribution of its imported products. As at December 31, 2010, the Company has advanced $85,000 towards the leasehold improvements of future store(s) planned for the latter half of 2011.  NOTE 4  INTANGIBLE ASSETS  On May 5, 2008, the Company signed an agreement with Legacy Wine and Spirits Merchants Ltd (Legacy Merchants) a Hong Kong based Company, for the rights to a fifteen (15) year general license to import, bottle, blend, manufacture and distribute wine and spirits in China. The agreement did not take effect until the Company completed its name change, which was completed on May 27, 2008. Legacy Merchants was issued 1,000,000 restricted shares of the Companys Rule 144 stock valued at $960,000 for the rights to the aforementioned license through its agreement with Beijing Nine Dragons Winery Co. Ltd (Nine Dragons) a China based company. Through Legacy Merchants and its agreement with Crown StarHoldings Ltd, an alcoholic beverage sourcing company with offices in Canada and Hong Kong, the Company has access to a wide selection of fine wine and spirits.   The Company opened one wine and spirits retail stores to be located in Tianjin, China in December, 2008. The store is approximately 1,900 sq. ft. and named Legacy Wine and Spirits and will initially stock imported red and white wines as well as a selection of spirits from Bronco winery in California, USA.. This initial store will be a flagship model for a franchising plan designed to further broaden the Companys distribution facilities and gain further market awareness and penetration of the Legacy brand.  Once the Legacy retail stores have been established, the Company will exercise its First Right of Refusal to start-up its manufacturing facility in Beijing through Legacy Merchants agreement with Nine Dragons. Intangible assets include the following:  Description
    December 31,
    December 31,2010
    200915 year general license to acquire & distribute wine & spirits in China
    $         960,000
    $         960,000Website development , branding and labeling costs incurred
    65,100
    65,100Less: accumulated amortization
    (142,375)
    (74,035)$         882,725
    $         951,065Less: write-down of intangible assets
    (872,225)
    -Adjusted Balance
    $          10,500
    $        951,065  23   NOTE 5  DEFERRED COMPENSATION  On November 1, 2008, the Company entered into an agreement with Charlton Investments Limited. (Charlton), a private company controlled by a significant shareholder, with a two-year term, whereby Charlton will provide investment-banking services to the Company (valued at $120,000) in exchange for 200,000 restricted shares of the Companys common stock.  On November 1, 2008, the Company entered into an agreement with Compte de Sierge Accomodative Corp. Ld.., (Compte) a private company owned by a significant shareholder of the Company, for a two year term, whereby Compte will provide investor relations services to the Company (valued at $120,000) in exchange for 200,000 restricted shares of the Companys common stock. Compte will provide such services as researching, editing and generating a company profile, relaying the Companys business perspectives and distribution of corporate updates, including press releases.  On May 15, 2010, the Company entered into an agreement with Palisades Financial Ltd. (Palisades), a private company controlled by a significant shareholder, with a two-year term, whereby Palisades provides investor relations services to the Company (valued at $30,000) in exchange for 750,000 restricted shares of the Companys common stock  On May 15, 2010, the Company entered into an agreement with a consultant, for a two year term, whereby the consultant provides consulting services to the Company (valued at $30,000) in exchange for 750,000 restricted shares of the Companys common stock.  On December 1, 2010, the Company entered into an agreement with Charlton Investments Limited. (Charlton), a private company controlled by a significant shareholder, with a two-year term, whereby Charlton will provide investment-banking services to the Company (valued at $10,000) in exchange for 500,000 restricted shares of the Companys common stock.  On December 1, 2010, the Company entered into an agreement with Compte de Sierge Accomodative Corp. Ld.., (Compte) a private company owned by a significant shareholder of the Company, for a two year term, whereby Compte will provide investor relations services to the Company (valued at $10,000) in exchange for 500,000 restricted shares of the Companys common stock.. Compte will provide such services as researching, editing and generating a company profile, relaying the Companys business perspectives and distribution of corporate updates, including press releases.  The Company amortizes the costs of these services over the respective terms of the contracts.  During the year ended December 31, 2010, the Company recorded amortization of deferred compensation totaling $119,584 (2009 - $120,000 accrued) and as at December 31, 2010 the unamortized portion of the deferred compensation totaled $60,416.  NOTE 6  STOCKHOLDERS EQUITY  The Companys capitalization is 100,000,000 common shares with a par value of $0.0001 per share. 2010 Transactions On January 20, 2010 the Company issued 200,000 restricted common shares with a fair value of $14,000 to a consultant for his current services.  During the year ended December 31, 2010 the Company issued 12,882,500 shares under the Companys 2010 & 2009 Employee Stock Option Incentive Plans with a value of $301,950 for satisfaction of debt to related parties and $100,250 for certain other management and consulting services.    24   On May 26, 2010, the Company issued 1,500,000 restricted common shares with a fair value of $60,000 pursuant to deferred compensation agreements and on December 31, 2010, the Company issued 1,000,000 restricted common shares with a fair value of $20,000 pursuant to deferred compensation agreements.  During the year ended December 31, 2010 the Company issued 2,627,440 restricted common shares to settle a debt in the amount of $131,372 to Golden Spirit Enterprises Ltd. and issued 1,451,360 restricted common shares to settle a debt in the amount of $72,568 to Organa Gardens International Inc., both companies with directors in common. 2009 Transactions On January 22, 2009 the Company issued 400,000 restricted common shares with a fair value of $240,000 pursuant to deferred compensation agreements (See note 5).  On April 20, 2009 the Company issued 13,000 restricted common shares with a fair value of $7,930 in exchange for services.  On November 10, 2009 the Company issued 15,000 restricted common shares with a fair value of $1,950 in exchange for services.  During the year ended December 31, 2009, the Company issued 1,375,000 shares under the Companys 2009 & 2008 Employee Stock Option Incentive Plans with a value of $192,300 for satisfaction of debt to related parties and 345,000 shares for cash proceeds of $51,300.  2010 Stock Options During the year ended December 31, 2010 the Company issued 12,882,500 shares under the Companys 2010 & 2009 Employee Stock Option Incentive Plans with a value of $301,950 for satisfaction of debt to related parties and $100,250 for certain other management and consulting services. The Companys stock option activity is as follows: Number of optionsWeighted Average Exercise PriceWeighted Average Remaining Contractual LifeBalance, December 31, 2008---Granted during the period1720,0000.25-Exercised during the period( 1,720,000)0.25-Balance, December 31, 2009-$                --Granted during the period12,882,5000.03-Exercised during the period(12,882,500)0.03-Balance, December 31, 2010-$                --  As of December 31, 2010 there were Nil stock options available for grant under the Companys 2008 and 2009 Stock Incentive and Option Plans.  On February 9, 2010, the Company filed Registration Statements on Form S-8 to register 9,000,000 to be issued pursuant to the Companys 2010 Stock Incentive and Option Plan. As of December 31, 2010 there were 1,015,000 stock options available for grant under the Companys 2010 Stock Incentive and Option Plan   25    2009 Stock Options  During the year ended December 31, 2009, the Company granted a total of 1,720,000, 5 year common stock options at various prices between $0.06 - $0.45 per share, of which 1,375,000 were exercised immediately in satisfaction of debts to related parties in the amount of $192,300. The Company recognized stock-based compensation of $19,350, which represented the fair value of the remaining 345,000 stock options granted to consultants.  The Company received cash proceeds of $51,300 on the exercise of the 345,000 stock options.  The Companys stock option activity is as follows:  Number of optionsWeighted Average Exercise PriceWeighted Average Remaining Contractual LifeBalance, December 31, 2007-$                     --Granted during 2008162,5000.60-Exercised during 2009(162,500)0.60-Balance, December 31, 2008---Granted during the period1720,0000.25-Exercised during the period( 1,720,000)0.25-Balance, December 31, 2009-$                --  As of December 31, 2009, there were 587,500 stock options available for grant under the Companys 2008 Stock Incentive and Option Plan.  On June 5, 2009, the Company filed Registration Statements on Form S-8 to register 6,000,000 to be issued pursuant to the Companys 2009 Stock Incentive and Option Plan. As of December 31, 2009, there were 4,310,000 stock options available for grant under the Companys 2009 Stock Incentive and Option Plan  NOTE 7  RELATED PARTY TRANSACTIONS During the year ended December 31, 2010, the Company incurred expenses for consulting fees of $220,000 (2009 - $115,000) to companies controlled by a significant shareholder and $3,142 (2008 - $9,189) for directors fees.  During the year ended December 31, 2010, the Company incurred expenses for services of $119,584 (2009 - $120,000) to three companies controlled by a significant shareholders and one consultant pursuant to service contracts (See Note 5).  During year ended December 31, 2010, the Company incurred expenses for rent of $26,694 (2009 - $27,612) to a Company controlled by a significant shareholder.  The following amounts are due to related parties: December 31,
2010December 31,
2009Organa Gardens International Inc.$                     -$         131,372Golden Spirit Enterprises Ltd.-72,691Significant shareholders39,6129,149$           39,612$          213,212  All related party transactions are in the normal course of business and are measured at the exchange amount, which is the amount of consideration established and agreed to by the related parties. All amounts owed to the above related parties are unsecured, non-interest bearing and have no specific terms of repayment.    26   NOTE 8 - INCOME TAXES  Potential benefits of United States Federal income tax losses are not recognized in the accounts until realization is more likely than not. As of December 31, 2010, the Company has combined net operating losses carried forward totaling approximately $4,598,000 for tax purposes which expire through 2030. Availability of loss usage is subject to change of ownership limitations under Internal Revenue Code 382 for 2002 and prior years losses.  Pursuant to ASC Topic 740, the Company is required to compute tax asset benefits for net operating losses carried forward. Future tax benefits which may arise as a result of these losses have not been recognized in these financial statements, as their realization is determined not likely to occur and accordingly, the Company has recorded a valuation allowance for the deferred tax asset relating to these tax loss carry forwards.  A reconciliation of income tax computed at the federal and state statutory tax rates is as follows: Year ended
December 31, 2010Year ended
December 31, 2009Federal income tax provision at statutory rate(35.00)%(35.00)%State income tax provision at statutory rate, net of federal income tax effect(0.00)(0.00)Total income tax provision rate(35.00)%(35.00)%  The actual income tax provisions differ from the expected amounts calculated by applying the federal income tax statutory rate to the Companys loss before income taxes. The components of these differences are as follows: Year ended
December 31, 2010Year ended
December 31, 2009Loss before income taxes$       (1,536,307)$         (568,263)Corporate tax rate35.00%35.00%Expected tax expense (recovery)(537,707)(198,892)Non-deductable stock based compensation19,35019,350Unrecognized loss carry forward and other518,357179,542Income tax provision$                       -$                       -  The Companys tax-effected deferred income tax assets and liabilities are estimated as follows:  20102009Non-capital loss carry forwards$-$-Valuation allowance--Net deferred tax asset$-$-    27    NOTE 9 - SUPPLEMENTARY CASH FLOW INFORMATION AND NON-CASH INVESTING AND FINANCING ACTIVITIES  Year ended December 31,For the period from February 19, 1999 (inception) to20102009December 31 ,2010Cash paid during the period for:Interest$                    -$                    -$                    -Income taxes$                    -$                    -$                    -Shares issued for other intangible assets$                     -$                   -$         960,000Shares issued for debt settlement$         505,890$         192,300$    1,1309,479  Shares issued for deferred compensation$           80,000$         240,000$        320,000  During the year ending December 31, 2010: The Company issued 200,000 restricted common shares with a fair value of $14,000 to a consultant for his current services. The Company issued 12,882,500 shares under the Companys 2010 & 2009 Employee Stock Option Incentive Plans with a value of $301,950 for satisfaction of debt to related parties and $100,250 for certain other management and consulting services. The Company issued 1,500,000 restricted common shares with a fair value of $60,000 pursuant to deferred compensation agreements and on December 31, 2010, the Company issued 1,000,000 restricted common shares with a fair value of $20,000 pursuant to deferred compensation agreements. The Company issued 2,627,440 restricted common shares to settle a debt in the amount of $131,372 to Golden Spirit Enterprises Ltd. and issued 1,451,360 restricted common shares to settle a debt in the amount of $72,568 to Organa Gardens International Inc., both these companies having directors in common.  During the year ending December 31, 2009: The Company issued 400,000 restricted common shares with a fair value of $240,000 pursuant to deferred compensation agreements. The Company issued 13,000 restricted common shares with a fair value of $7,930 in exchange for services. The Company issued 15,000 restricted common shares with a fair value of $1,950 in exchange for services. The Company issued 1,375,000 common shares with a value of $192,300 for satisfaction of debt to related parties and 345,000 shares for cash proceeds of $51,300.   NOTE 10  COMMITMENTS AND CONTINGENCIES  As of August 1, 2010, the Company has leased 1250 sq. ft of office space from Holm Investments Ltd. at $2,500 per month for a period of 3 years. As of October 15, 2008, the Company has leased it wine store in Tianjin for a period of 10 years (renewable for an additional 5 years), at $1,225 per month. See table below for Tianjin lease schedule.  Tianjin Store20102011201220132014TOTALLease rental$14,700$14,700$14,700$14,700$14,700$73,500  NOTE 11  SUBSEQUENT EVENTS  On January 13, 2011, the Company issued 45,000 restricted commons shares valued at $900 to two directors for their current services.  On January 26, 2011, the Company filed a Registration Statement on Form S-8 to register 11,000,000 shares to be issued pursuant to the Companys 2011 Stock Incentive and Option Plan. In 2011, the Company granted and issued 8,425,000 shares $0.02 per share pursuant to the Companys 2011 Stock Incentive and Option Plan for settlement of debt to related parties and certain other management and consulting services of $168,500.    28    ITEM 9.    CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE  There have been no disagreements with Legacy Wine & Spirits International Ltd.'s auditors since formation of the company that require disclosure pursuant to Item 304 of Regulation S-B.   ITEM 9A.    CONTROLS AND PROCEDURES EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES  Disclosure Controls and Procedures  We maintain a system of internal and disclosure controls and procedures designed to ensure that information required to be disclosed by us in the reports we file or submit under the Exchange Act, is recorded, processed, summarized and reported on a timely basis, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.  Our management, under the supervision and with the participation of our Chief Executive Officer and our Chief Financial Officer, have evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) or 15d-15(e)) under the Securities Exchange Act of 1934, as amended) as of the end of the period covered by this Annual Report. Based on such evaluation, our Chief Executive Officer and our Chief Financial Officer they have concluded that, as of the evaluation date, our disclosure controls and procedures are effective in alerting them on a timely basis to material information relating to us required to be included in our reports filed or submitted under the Exchange Act.  Internal Controls 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. Our management, including our Chief Executive Officer and Chief Financial Officer, conducted an evaluation of the effectiveness of our internal control over financial reporting based on criteria established in the framework in Internal ControlIntegrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this assessment, management determined that, during the year ended December 31, 2010, our internal controls and procedures were not effective to detect the inappropriate application of US GAAP rules, as more fully described below. This was due to deficiencies in the design or operation of the Companys internal control that adversely affected the Companys internal controls and that may be considered to be material weaknesses.  Management identified the following material weaknesses in internal control over financial reporting:  1. The Company has limited segregation of duties with respect to its operations in the Peoples Republic of China, which is not consistent with good internal control procedures.  2. The Company does not have a written internal control procedurals manual which outlines the duties and reporting requirements of the Directors and any staff to be hired in the future. This lack of a written internal control procedurals manual does not meet the requirements of the SEC or good internal controls.  Management believes that the material weaknesses set forth in items 1 and 2 above did not have an affect on the Companys financial results.  The Company and its management will endeavor to correct the above noted weaknesses in internal control as it begins to expand its operations in the Peoples Republic of China and once it has adequate funds to do so. Management will continue to monitor and evaluate the effectiveness of the Companys internal controls and procedures and its internal controls over financial reporting on an ongoing basis and are committed to taking further action and implementing additional enhancements or improvements, as necessary and as funds allow.  Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risks that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.  This Annual Report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Managements report was not subject to attestation by our registered public accounting firm pursuant to temporary rules of the SEC that permit us to provide only managements report in this Annual Report.  Changes In Internal Controls  No changes in the Company's internal controls over financial reporting occurred during the year ended December 31, 2010 that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.   29     Code of Ethics  We intend to adopt a code of ethics in 2011 that applies to our principle executive officer, principal financial officer, principle accounting officer or controller, other persons performing similar functions.  We intend to post the text of our code of ethics on our website in connection with our "Investor Relations" materials.  In addition, we intend to promptly disclose (1) the nature of any amendment to our code of ethics that applies to our principle executive officer principal  financial officer, principle accounting officer or controller, other persons  performing similar functions (2) the nature of any wavier, including an implicit wavier, from a provision of our code of ethics that is granted to one of these specific officers, the name of such person who is granted the waiver and the date of the waiver on our web site in the future.  We do not currently have a code of ethics as this is a new regulatory requirement and we are examining the various form and contents of other companies written code of ethics, discussing the merits and meaning of a code of ethics to determine the best form for our Company.   ITEM 9B.    OTHER INFORMATION  Not applicable.   PART III  ITEM 10.    DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE   Executive Officers and Directors. We are dependent on the efforts and abilities of certain of our senior management.  The interruption of the services of key management could have a material adverse effect on our operations, profits and future development, if suitable replacements are not promptly obtained. We anticipate that we will enter into employment agreements with each of our key executives; however, no assurance can be given that each executive will remain with us during or after the term of his or her employment agreement. In addition, our success depends, in part, upon our ability to attract and retain other talented personnel. Although we believe that our relations with our personnel are good and that we will continue to be successful in attracting and retaining qualified personnel, there can be no assurance that we will be able to continue to do so. Our officers and directors will hold office until their resignation or removal.  Our directors and principal executive officers are as specified on the following table:  Name and Address Age Position  Date of Appointment ---------------------------------------------------------------------------------------------------------------------------- Jaclyn Cruz 35 President & Director & CEO November 18, 2008  Matt Kelly 35 Secretary, Treasurer December 20, 2010 & Director  & CFO  The chart above specifies Legacy Wine & Spirits International Ltd.s current officers and directors. All directors of the Company hold office until the next annual meeting or until their successors have been elected and qualified.  All officers serve at the discretion of the Board of Directors. There are no familial relationships between our officers and directors.  Section 16(a) Beneficial Ownership Reporting Compliance. Not all of our officers, directors, and principal shareholders have filed all reports required to be filed by those persons on, respectively, a Form 3 (Initial Statement of Beneficial Ownership of Securities), a Form 4 (Statement of Changes of Beneficial Ownership of Securities), or a Form 5 (Annual Statement of Beneficial Ownership of Securities).    30   ITEM 11.    EXECUTIVE COMPENSATION  SUMMARY COMPENSATION TABLE  Name and Principal PositionYearSalary (US$)Bonus (US$)Stock Awards (US$)Option Awards (US$)Non-Equity Incentive Plan Compensation (US$)Nonqualified Deferred Compensation Earnings (US$)All Other Compensation (US$)Total (US$)Jaclyn
Cruz
President20083,50002,5500000020092,191000000020105000000000MattKellyDirector201000000000  On December 20, 2010, the Registrant accepted the resignation of Christopher Scheive as Secretary, Treasurer, Director and Chief Financial Officer of the Registrant. Prior to his resignation, Mr. Scheive received a salary only of $2,642 in 2010. (2009 - $7,000; 2008 - $1,000). In 2008, Mr. Scheive received a stock award valued at $16,250. No stock awards were received by Mr. Scheive in 2009 or 2010.  We have no employment agreements with any of our director and sole officer. We do not contemplate entering into any employment agreements until such time as we begin profitable operations. There is no assurance that we will ever generate revenues from our operations. The compensation discussed herein addresses all compensation awarded to, earned by, or paid to our named executive officer. 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.  Stock-based Compensation. During the year ended December 31, 2010, $Nil (2009-$19,350) in stock-based compensation was recorded in our financial statements.  Stock-based compensation is an estimate of the intrinsic value placed in respect to stock options granted to officers, directors, employees and an estimate of the fair value of stock options granted to consultants using the Black-Scholes option pricing model. We do not expect further stock-based compensation in 2011.  In the instance that incentive stock options are granted and immediately exercised to satisfy debts to related parties, the Company, accordingly, records no further compensation expense.   31    ITEM 12.    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS   The following table sets forth certain information regarding the beneficial ownership of our common stock as of December 31, 2010, by each person or entity known by us to be the beneficial owner of more than 5% of the outstanding shares of common stock, each of our directors and named executive officers, and all of our directors and executive officers as a group.      Name of Amount & Nature of Percent of Class Title of Class Beneficial Owner Beneficial Owner Common Stock --------------------------------------------------------------------------------------------------------------------------------------------   Jaclyn Cruz  P.O. Box 63 5,000 0.0001% President/.Director/CEO Farmingville, New York 11738   Matt Kelly 123 Van Horne Avenue - 0.00% Secretary /Director /CFO Holbrook, New York 11741  All directors and Officers as a group   5,000 0.0001%    Security Ownership by Management.  As above, at December 31, 2010, our directors, Jaclyn Cruz owned 5,000 shares and Matt Kelly owned Nil shares for and aggregate total of 5,000 shares or 0.0001% of the common stock outstanding.  Changes in Control.  Our management is not aware of any arrangements which may result in "changes in control" as that term is defined by the provisions of Item 403(c) of Regulation S-B.    32   ITEM 13.    CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND 
DIRECTOR INDEPENDENCE   During the year ended December 31, 2010, the Company incurred expenses for consulting fees of $220,000 (2009 - $115,000) to companies controlled by a significant shareholder and $3,142 (2008 - $9,189) for directors fees.  During the year ended December 31, 2010, the Company incurred expenses for services of $119,584 (2009 - $120,000) to three companies controlled by a significant shareholders and one consultant pursuant to service contracts.  During year ended December 31, 2010, the Company incurred expenses for rent of $26,694 (2009 - $27,612) to a Company controlled by a significant shareholder.  The following amounts are due to related parties: December 31,
2010December 31,
2009Organa Gardens International Inc.$                     -$         131,372Golden Spirit Enterprises Ltd.-72,691Significant shareholders39,6129,149$           39,612$          213,212  All related party transactions are in the normal course of business and are measured at the exchange amount, which is the amount of consideration established and agreed to by the related parties. All amounts owed to the above related parties are unsecured, non-interest bearing and have no specific terms of repayment. ITEM 14.    PRINCIPAL ACCOUNTING FEES AND SERVICES  1. Audit Fees: Aggregate fees billed for each of the last two (2) fiscal years for professional services rendered by the principal accountant for the audit of the annual financial statements and review of financial statements included on Form 10-Q: 2010: $35,000 2009: $36,000  2. Audit-Related Fees: Aggregate fees billed in each of the last two (2) fiscal years for assurance and related services by the principal accountant that are reasonably related to the performance of the audit or review of the financial statements and are not reported previously. These services include the review of certain registration statements and certain comment letters from the US SEC. 2010: $4,000 2009: $1,000  3. Tax Fees: Aggregate fees billed in each of the last two (2) fiscal years for professional services rendered by the principal accountant for tax compliance, tax advice, and tax planning. 2010: $0 2009: $0  4. All Other Fees: Aggregate fees billed in each of the last two (2) fiscal years for products and services provided by the principal accountant, other than the services previously reported. 2010: $0 2009: $0    33    5. Audit Committee Pre-Approval Procedures. The Board of Directors has not, to date, appointed an Audit Committee.  PART IV  ITEM 15.    EXHIBITS AND FINANCIAL STATEMENT SCHEDULES  Exhibit 31.1 - Section 906 Certification of Periodic Report of the Chief Executive Officer.  Exhibit 31.2 - Section 906 Certification of Periodic Report of the Chief Financial Officer.  Exhibit 32.1 - Section 302 Certification of Periodic Report of the Chief Executive Officer.  Exhibit 32.1 - Section 302 Certification of Periodic Report of the Chief Financial Officer.  b) Form 8-K  Form 8-K filed December 22, 2010 with respect to shares for debt settlement agreements, directorship changes and a change in corporate address.   SIGNATURES  In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this amended report to be signed on its behalf by the undersigned, thereunto duly authorized, on April 15, 2011  Legacy Wine & Spirits International Ltd. a Delaware corporation  By: /s/: Jaclyn Cruz ----------------------- Jaclyn Cruz Its: Director and President    In accordance with the Exchange Act, this amended report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.  /s/: Jaclyn Cruz ------------------------------------ Date: April 15, 2011 Jaclyn Cruz President and a Director  By: /s/ Matt Kelly -------------------------------------  Date: April 15, 2011 Matt Kelly, Director, Secretary & Treasurer   34