United States Securities and Exchange Commission

Washington, D.C. 20549
  FORM 10-K



[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE FISCAL YEAR ENDED DECEMBER 31, 2009
OR ̈TRANSITION 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.

|                         |            
|------------------------ | -----------
|                         |            
|NEVADA                   | 91-1963840 
|(STATE OF INCORPORATION) | (I.R.S. ID)

1802 GOYA STREET, JONQUIERE, QUEBEC, G7Z 1C3

(514) 688-3289

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

COMMON STOCK    OTC: BB

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  ̈



Accelerated filer    ̈

Non-accelerated filer    ̈   (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, 2010, there were 29,139,085 shares of the issuer's $0.0001 par value common stock issued and outstanding.



Documents incorporated by reference:  None



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Legacy Wine & Spirits International Ltd.
FORM 10-K

For The Fiscal Year Ended December 31, 2009

INDEX



PART I

3



















ITEM 1.    BUSINESS

3

ITEM 1A.  RISK FACTORS

6

ITEM 1B.  UNRESOLVED STAFF COMMENTS

6

ITEM 2.    PROPERTIES

6

ITEM 3.    LEGAL PROCEEDINGS

7

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

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

11

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

11

ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

12

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 EVALUATION OF  DISCLOSURE CONTROLS AND PROCEDURES

30

ITEM 9B.  OTHER INFORMATION

31

PART III



31

ITEM 10.    DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

31

ITEM 11.    EXECUTIVE COMPENSATION

32

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

35





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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.

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 Wine & Spirits International 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.





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. 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 will be named Legacy Wine and Spirits and will initially stock imported red and white wines as well as a selection of spirits 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.



-3-



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.  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 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, 2009, the inventory totaled $39,863 (2008- $66,082).



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 is stocked with select, moderately priced imported wines  and will serve as the design and sales model for all franchise boutiques opened thereafter.  This phase sees Legacy establishing its brand name and retail stores through Point of Purchase marketing and taste appreciation gatherings.  Legacy will also 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.



Phase Two:



Legacy has $85,000 reserved for leasehold improvements required to be made to future store locations. Additionally, the Company is in negotiations with three (3) existing wine and spirit stores in China.  These stores are located in and around the Company's flagship store in TEDA (Tianjin Economic Development Area).



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. With limited capital investment necessary and the Company's stock as a negotiable tool, 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.



-4-



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 will begin in the third quarter of 2010.



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 will begin in the fourth quarter of 2010.



The Company attended the Shanghai-Fujian Seafood Association (SFSA) dinner where Legacy's wines were the only wines featured at the seafood/wine pairing dinner on December 11, 2009. The SFSA provides up to 40% of the seafood consumed in Shanghai. The event provided an excellent opportunity to broaden the base of acceptance for Legacy's wine selections and resulted in immediate orders for 400 cases of Legacy wines as well as the consumption of 30 cases of wine at the event.



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 2010. 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 2010 to aggressively enter the Xiamen market. Similar to Shanghai the local partners currently buy wine from Legacy.



Further, the Company is in the process of producing the first of its own brand of select wines under private label from choice vintners around the world.

The first selection will be from the region of Chile in South America, to be known as the Andes Primera Collection by Legacy. The Andes Primera Brand will consist of red wine varietals only such as Cabernet Sauvignon, Merlot, Malbec, Camanere and Cabernet-Merlot. Currently, imported bottled Chilean wines in China are competitive in price due to a special trade agreement between the two countries.





-5-



ITEM 1A.    RISK FACTORS



Not applicable to smaller reporting companies



ITEM 1B.    UNRESOLVED STAFF COMMENTS

None.

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, 2009



December 31, 2008

--------------------------------------------------------------------------------------------------------------------

Cash and equivalents

US $ 6,743



US $ 13,432



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  $990 (2008  $1,416)



Facilities.

As of August 1, 2002, Legacy Wine & Spirits International Ltd. has leased 1250 sq. ft of office space from Holm Investments Ltd. at $1,000 per month for a period of 3 years and has been renewed for an additional 3 years at $1,100 per month. The current tenancy agreement expired August 1, 2008 and was renewed for 3 additional years at $1,100 per month. Effective September 1, 2008, the Company has also leased an additional 900 sq. ft office from 1063244 Alberta Ltd. for $1,100.00 per month on a month to month basis. 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.



-6-

ITEM 3.    LEGAL PROCEEDINGS



None.



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



None





PART II

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



As at December 31, 2009 there were approximately 2,000 holders of the outstanding shares of the Legacy Wine & Spirits International Ltd.'s $0.001 par value common stock.  Legacy Wine & Spirits International Ltd. participates in the OTC Bulletin Board Electronic Quotation System maintained by the National Association of Securities Dealers, Inc., under the most recent trading symbol "LEYM". Legacy Wine & Spirits International Ltd. began trading October 30, 2007. According to quotes provided by stockhouse.com, the Legacy Wine & Spirits International Ltd.'s common stock has closed at:



Quarter



High



Low

2007 Fourth Quarter

$0.75

$0.15

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



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.



-7-



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, 2009, 22,744,085 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.



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

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 2008 & 2009 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-

2008 Transactions

On February 27, 2008 the Company issued 25,000 restricted common shares with a fair value of $16,250 to a newly appointed director for his current services.



On May 27, 2008, the Company issued 294,083 shares of Legacy Wine & Spirits International Ltd. common stock in satisfaction of $147,041 owed to nine (9) related parties.  The issuance price of thecommon stock was $0.50 per share as agreed  between the debtors and Legacy Wine & Spirits International Ltd. The fair market value of those shares on the date of issue was $0.95 per share, resulting in interest on the settlement of debt in the

amount of $132,337.



On June 12, 2008, the Company completed the closing of the first phase in connection with a Private Placement (the Private Placement) of its securities to certain accredited investors for aggregate gross proceeds of $460,000. The investors purchased an aggregate of 920,000 shares of the Company at a price of $0.50 per share and these shares were issued subject to restrictions under Rule 144. The Company is now proceeding with the

second phase in connection with a Private Placement, which will raise an additional $540,000 through the issuance of 720,000 shares of the Registrant at a price of $0.75 per share for grand total proceeds of $1,000,000.



On June 13, 2008, the Company issued 1,000,000 restricted common shares valued at $960,000 to acquire a 15 year general license to import, bottle, blend, manufacture & distribute wine and spirits throughout China.



On August 19, 2008, the Company issued 85,000 shares of Legacy Wine & Spirits International Ltd. common stock in satisfaction of $42,500 owed to three (3) related parties.  The issuance price of the

common stock was $0.50 per share as agreed between the debtors and Legacy Wine & Spirits International Ltd. The fair market value of those shares on the date of issue was $0.70 per share, resulting in interest on the settlement of debt in the amount of $17,000.



On September 16, 2008, the Company issued 5,000 restricted common shares valued at $2,550 to a new director for directors fees.



On October 7, 2008, the Company issued 6,000 restricted common shares for cash in the amount of $3,000 for a previous share subscription with respect to the second phase of a private placement as described above.



On October 22, 2008, the Company received proceeds of $97,500 for the issue of 162,500 shares under the Companys 2008 Employee Stock Option Incentive 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 that were granted and immediately exercised.





-9-

The Companys stock option activity is as follows:



|                            |                   |                                 |                                            
|--------------------------- | ----------------- | ------------------------------- | -------------------------------------------
|                            | Number of options | Weighted Average Exercise Price | Weighted Average Remaining Contractual Life
|                            |                   |                                 |                                            
|Balance, December 31, 2007  | -                 | $                     -         | -                                          
|Granted during 2008         | 162,500           | 0.60                            | -                                          
|Exercised during 2009       | (162,500)         | 0.60                            | -                                          
|                            |                   |                                 |                                            
|Balance, December 31, 2008  | -                 | -                               | -                                          
|Granted during the period   | 1720,000          | 0.25                            | -                                          
|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.



2008 Stock Options

During the year ended ended December 31, 2008, the Company granted a total of 162,500, 5 year common stock options at an exercise price of $0.60 per share.  The Company recognized stock-based compensation of $4,875 in accordance with SFAS 123R which represented the fair value of stock options granted to consultants in exchange for services rendered to the Company.



(a)

The Companys stock option activity is as follows:



Number of optionsWeighted Average Exercise PriceWeighted Average Remaining Contractual LifeBalance, December 31, 2007-Granted during 2008162,5000.605 yearsExercised during 2008(162,500)Balance, December 31, 2008---




(b)

As of December 31, 2008, there were 617,500 stock options available for grant under the Companys 2008 Stock Incentive and Option Plan.



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ITEM 6.    SELECTED FINANCIAL DATA





Fiscal Year Ended December 31200920082007Revenue$    45,453$         2,055$              NilOperating Loss(586,353)(505,183)(100,657)Net Loss(568,263)(668,369)(100,657)Basic net loss per share0.030.0301Cash dividends declared per share---Cash, cash equivalents,  and short-term investments6,74313,4326,014Total assets1,205,3951,315,6149,952Long-term obligations---Stockholders equity (deficit)936,2931,111,7261,922,877




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, 2009, we had total assets of $1,205,395, compared to total assets in 2008 of $1,315,614. This includes a cash balance of $6,743, compared to $13,432 in 2008.  We also have inventory of $39,863 and prepaid expenses of $10,871.  We have $110,863 invested in leasehold improvements, $85,000 on deposit for future leasehold improvements, intangible assets of $951,065 and $990 in furniture and fixtures.



At December 31, 2009, we had current liabilities of $269,102, which was represented by accounts payable and accrued liabilities of $55,890 and $213,212 total due to Golden SpiritEnterpirses Ltd.,Organa Gardens Internatonal Inc. and other related parties. At December 31, 2008 we had current liabilities of $203,888. The slight decrease in liabilities was due to a decrease in funds due to related parties. At December 31, 2009, we had a working capital deficiency of $211,625 (2008 - $(122,880)).



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.



Results of Operations



We have $45,453 revenues from operations to date. During the year ended December 31, 2009 the loss is $568,263 (2008 - $668,639).  This decrease in loss was due to $Nil interest on settlement of debt in 2009 (2008 - $149,337)..



From inception to December 31, 2009 our Company has incurred cumulative net losses of $3,451,021, 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, and a write-down of website development costs in the amount of $158,772; management and consulting fees of $673,810; travel and accommodation of $108,576; office and general expenses of $416,814 professional fees of $330,139; depreciation and amortization expense of $115,215 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.



-11-



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



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.

Quebec, Canada



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, 2009 and 2008, and the related consolidated statements of operations, stockholders equity (deficit), and cash flows for each of the years in the two year period ended December 31, 2009 and for the cumulative period from February 19, 1999 (inception) to December 31, 2009. 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, 2009 and 2008, and the results of its activities and cash flows for each of the years in the two year period ended December 31, 2009 and for the cumulative period from February 19, 1999 (inception) to December 31, 2009 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

April 8, 2010

Las Vegas, Nevada





-12-



LEGACY WINE & SPIRITS INTERNATIONAL LTD.

(A development stage Company)

CONSOLIDATED BALANCE SHEETS



December 31,
    2009December 31,
    2008ASSETSCURRENT ASSETSCash$               6,743$              13,432Inventory, at cost39,86366,082Prepaid  Expenses10,87111,494TOTAL CURRENT ASSETS57,47791,008DEPOSIT ON LEASEHOLD IMPROVEMENTS85,00085,000LEASEHOLD IMPROVEMENTS, net of depreciation of $8,643 (2008 - $719)110,863118,786FURNITURE AND FIXTURES, net of depreciation of $32,537 (2008 - $32,112)9901,415OTHER INTANGIBLE ASSETS,net of amortization of $74,035 (2008 - $5,695)951,0651,019,405TOTAL ASSETS$         1,205,395$         1,315,614LIABILITIES AND STOCKHOLDERS EQUITY (DEFICIT)CURRENT LIABILITIESAccounts payable and accrued liabilities$             55,890$              35,923Due to Golden Spirit Enterprises Ltd.72,69131,331Due to Organa Gardens International Inc.131,372116,631Due to related parties9,14920,003TOTAL CURRENT LIABILITIES269,102203,888STOCKHOLDERS EQUITY (DEFICIT)Common stock, $.0001 par value, 100,000,000 shares authorizedIssued and outstanding: 22,744,085 (2008  20,596,085) common shares2,2752,060Additional paid-in capital4,485,0393,972,424Common Stock to be issued-20,000Deferred Compensation(100,000)-Deficit accumulated during the development stage(3,451,021)(2,882,758)TOTAL STOCKHOLDERS EQUITY (DEFICIT)936,2931,111,726TOTAL LIABILITIES AND STOCKHOLDERS EQUITY (DEFICIT)$      1,205,395$         1,315,614




The accompanying notes are an integral part of these consolidated financial statements





-13-





LEGACY WINE & SPIRITS INTERNATIONAL LTD.

(A devlopment stage company)

CONSOLIDATED STATEMENTS OF OPERATIONS

Year
    ended
    December 31, 2009Year
    ended
    December 31, 2008Cumulative results of operations from February, 19 ,1999 (inception) to December 31,2008REVENUESWine sales$        45,453$     2,055$             47,508COST OF GOOD SOLD27,36367428,037GROSS PROFIT18,0901,38119,471GENERAL AND ADMINISTRATIVE EXPENSESWine promotions4982,7353,233Store supplies1,8641,5373,401Advertising509248757Property Tax-1,9621,962Investor Relations62,50010,00072,500Consulting243,948298,148673,810Depreciation and Amortization76,6887,021115,215Exploration costs--17,214Management fees--131,200Office and general84,95959,531416,814Professional fees73,11270,609330,139Travel and accommodation14,00928,494108,576Wages and salaries28,26624,898111,909Website development costs--158,772Write-down of technology license--912,653Write-down of URLs--247,500TOTAL EXPENSES586,353505,1833,305,655OTHER INCOME (EXPENSES)Property Option Loss-(15,500)(15,500)Interest on settlement of due to related parties-(149,337)(149,337)TOTAL OTHER INCOME (EXPENSES)-(164,837)(164,837)Loss before Income Taxes(568,263)(668,639)(3,451,021)Income Tax Provision---NET LOSS$     (568,263)$     (668,639)$  (3,451,021)BASIC AND DILUTED INCOME LOSS PER SHARE$          (0.03)$           (0.03)WEIGHTED AVERAGE COMMON
    SHARES OUTSTANDING -
    BASIC AND DILUTED21,243,86919,420,297








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, 2009

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, 2009

Number of sharesAmountAdditional paid-in capitalDeferred Compen-sationDeficit 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, 2009



Number of sharesAmountAdditional paid-in capitalDeferred Compen-sationDeficit accumulated during the exploration stageTotalJanuary 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


The accompanying notes are an integral part of these consolidated financial statements



-17-



LEGACY WINE & SPIRITS INTERNATIONAL Ltd.

(A development stage company)

CONSOLIDATED STATEMENTS OF CASH FLOWS



Year ended December 31, 2009Year ended December 31, 2008Cumulative results of operations from February 19, 1999 (inception) to December 31, 2009CASH FLOWS FROM OPERATING ACTIVITIESNet loss$   (568,263)$   (668,639)$   (3,451,021)Adjustments to reconcile net loss to net cash
    (used in) operating activities:-depreciation and amortization76,6887,021115,215- fees and services paid with shares and options149,23043,675242,905- interest on settlement of due to related parties-149,337149,337- non-cash exploration costs--9,500- 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 items20,590(778)494,655- inventory26,219(66,082)(39,863)NET CASH FLOWS (USED IN) OPERATING ACTIVITIES(295,536)(535,466)(1,209,040)CASH FLOWS FROM INVESTING ACTIVITIESAcquisition of furniture and equipment--(24,317)Deposit on Leasehold improvements-(85,000)(85,000)Leasehold improvements-(119,505)(119,505)Website development costs-(65,100)(223,872)NET CASH FLOWS USED IN INVESTING ACTIVITIES-(269,605)(452,694)CASH FLOWS FROM FINANCING ACTIVITIESNet advances (to) from related parties237,547251,989747,983Proceeds on sale of common stock51,300560,500871,800NET CASH FLOWS PROVIDED BY FINANCING ACTIVITIES288,847812,4891,619,783NET (DECREASE) INCREASE IN CASH(6,689)7,4186,743CASH, BEGINNING OF YEAR13,4326,014-CASH, END OF YEAR$         6,743$       13,432$             6,743








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



-18-



LEGACY WINE & SPIRITS INTERNATIONAL LTD.

(A development stage company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2009 and 2008




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 $3,451,021 from inception to December 31, 2009 and has a working capital deficiency of $211,625. 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 aeccompanying consolidated financial statements are presented In United States dollars and are prepared in accordance with accounting principles accepted in the United States.



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.



-19-

NOTE 2  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

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  generally from 3-5 years.

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. As of December 31, 2009, the Company believes there is no impairment of its intangible assets. 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.

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 is deposited in one prominent Canadian 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).



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.



-20-

NOTE 2  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

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 March 2008, the FASB issued an update to FASB ASC 815, Derivatives and Hedging  This update is intended to enhance the current disclosure framework in FASB ASC 815.  Under this update, entities will have to provide disclosures about (a) how and why and entity uses derivative instruments, (b) how derivative instruments and related hedged items are accounted for under FASB ASC 815 and its related interpretations, and (c), how derivative instruments and related hedged items effect an entitys financial position, financial performance and cash flows.  This update is effective for all financial statements issued for fiscal and interim periods beginning after November 15, 2008.  The Company does not currently have any derivative instruments, nor does it engage in hedging activities, therefore, the Companys adoption of this update in the first quarter of 2009 was without significant financial impact.



In April 2009, the FASB issued an accounting standard that requires disclosures about fair value of financial instruments not measured on the balance sheet at fair value in interim financial statements as well as in annual financial statements.  Prior to this accounting standard, fair values for these assets and liabilities were only required be disclosed annually.  This standard applies to all financial instruments within its scope and requires all entities to disclose the method(s) and significant assumptions used to estimate the fair value of financial instruments.  This standard does not require disclosures for earlier periods presented for comparative purposes at initial adoption, but in periods after the initial adoption, this standard requires comparative disclosures only for periods ending after initial adoption.  This accounting standard became effective for us beginning with the quarter ended on June 30, 2009, however, it did not have a material impact on our consolidated financial statements.



-21-

NOTE 2  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)



In May 2009, the FASB issued FASB ASC 855, Subsequent Events, ASC 855 provides authoritative accounting literature related to evaluating subsequent events that was previously addressed only in the auditing literature, and is largely similar to the current guidance in the auditing literature with some exceptions that are not intended to result in significant changes in practice. SFAS 165 defines subsequent events and also requires the disclosure of the date through which an entity has evaluated subsequent events and the basis for that date.  ASC 855 is effective on a prospective basis for interim or annual financial periods ending after June 15, 2009. The adoption of this standard during the period did not have any impact on the Companys financial position, cash flows or results of operations. The adoption of this standard during the period did not have any impact on the Companys financial position, cash flows or results of operations. On February 24, 2010, the FASB issued Accounting Standards Update (ASU) 2010-09, Amendments to Certain Recognition and Disclosure RequirementsAs a result of the amendments, SEC filers that file financial statements after February 24, 2010 are not required to disclose the date through which subsequent events have been evaluated.



In June 2009, the FASB issued SFAS No. 166, Accounting for Transfers of Financial Assets  an amendment of FASB Statement No. 140.  SFAS No. 166 amends SFAS No. 140, Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities by eliminating the concept of special-purpose entity, requiring the reporting entity to provide more information about sales of securitized financial assets and similar
transactions, particularly if the seller retains some risk to the assets, changes the requirements for the de-recognition of financial assets, and provides for the sellers of the assets to make additional disclosures.  This Statement shall be effective as of the Companys first interim reporting period that begins after November 15, 2009. Earlier application is prohibited.  The Company does not anticipate any significant financial impact from adoption of SFAS No. 166. As of September 30, 2009, SFAS No. 166 has not been added to the Codification.



In June 2009, the FASB issued SFAS No. 167, Amendments to FASB Interpretation No. 46(R).  SFAS No. 167 addresses the effect on FASB Interpretation 46(R), Consolidation of Variable Interest Entities of the elimination of the qualifying special-purpose entity concept of SFAS No. 166, Accounting for Transfers of Financial Assets.  SFAS No. 167 also amends the accounting and disclosure requirements of FASB Interpretation 46(R) to enhance the timeliness and usefulness of information about an enterprises involvement in a variable interest entity. This Statement shall be effective as of the Companys first interim reporting period that begins after November 15, 2009. Earlier application is prohibited.  The Company does not anticipate any significant financial impact from adoption of SFAS No. 167. As of December 31, 2009, SFAS No. 167 has not been added to the Codification.



In June 2009, the FASB issued Accounting Standard Update (ASU) No. 2009-01 (Topic 105)  Generally Accepted Accounting Principles  amendments based on  Statement of Financial Accounting Standards No. 168  The FASB Accounting and Standards Codification and the Hierarchy of Generally Accepted Accounting Principles. Beginning with this Statement the FASB will no longer issue new standards in the form of Statements, FASB Staff Positions, or Emerging Issues Task Force Abstracts.  Instead, it will issue Accounting Standard Updates.  This ASU includes FASB Statement No. 168 in its entirety.  While ASUs will not be considered authoritative in their own right, they will serve to update the Codification,

provide the bases for conclusions and changes in the Codification, and provide background information about the guidance.  The Codification modifies the GAAP hierarchy to include only two levels of GAAP:  authoritative and nonauthoritative.



ASU No. 2009-01 is effective for financial statements issued for the interim and annual periods ending after September 15, 2009, and the Company does not expect any significant financial impact upon adoption.



In July 2009, the FASB officially launched the FASB ASC 105 --  Generally Accepted Accounting Principles, which established the FASB Accounting Standards Codification (the Codification), as the single official source of authoritative, nongovernmental, U.S. GAAP, in addition to guidance issued by the Securities and Exchange Commission.  The Codification 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 2  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)



In August 2009, the FASB issued ASU No. 2009-05  Fair Value Measurements and Disclosures (Topic 820)  Measuring Liabilities at Fair Value.  This ASU clarifies the fair market value measurement of liabilities.  In circumstances where a quoted price in an active market for the identical liability is not available, a reporting entity is required to measure fair value using one or more of the following techniques: a technique that uses quoted price
of the identical or a similar liability or liabilities when traded as an asset or assets, or another valuation technique that is consistent with the principles of Topic 820
such as an income or market approach.  ASU No. 2009-05 was effective upon issuance and it did not result in any significant financial impact on the Company upon adoption.



-22-



In September 2009, the FASB issued Accounting Standard Update (ASU) No. 2009-12  Fair Value Measurements and Disclosures (Topic 820)  Investments in Certain Entities That Calculate Net Asset Value per Share (or its equivalent).  This ASU permits use of a practical expedient, with appropriate disclosures, when measuring the fair value of an alternative investment that does not have a readily determinable fair value.  ASU No. 2009-12 is effective for interim and annual periods ending after December 15, 2009, with early application permitted.  Since the Company does not currently have any such investments, it does not anticipate any impact on its financial statements upon adoption.

.

In December 2009, the FASB issued ASU No. 2009-17 regarding consolidations and improvements to financial reporting by enterprises involved with VIEs. This ASU changes how a company determines when an entity that is insufficiently capitalized or is not controlled through voting should be consolidated.  The determination of whether a company is required to consolidate an entity is based on, among other things, an entitys purpose and design and a companys ability to direct the activities of the entity that most significantly impact the entitys economic performance.  This statement is effective for us beginning in the first quarter of fiscal 2011 (October 1, 2010). We are currently assessing the potential impact that the adoption of ASU No. 2009-17 will have on our 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, 2098, the Company has advanced $85,000 towards the leasehold improvements of future store(s) planned for the latter half of 2010.



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 These approximate 1,900 sq. ft. store is 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:



DescriptionDecember 31,December 31,2009200815 year general license to acquire & distribute wine & spirits in China$         960,000$         960,000Website development , branding and labeling costs incurred65,10065,100Less: accumulated amortization(74,035)(5,695)$         951,065$      1,019,405


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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.



As of December 31, 2008, the Company had not issued the common stock related to these agreements. Additionally, the Company recorded $20,000 in common stock to be issued for services performed under the contracts at that date.



The Company amortizes the costs of these services over the respective terms of the contracts.  During the year ended December 31, 2009, the Company recorded amortization of deferred compensation totaling $120,000 (2008 - $20,000 accrued) and as at December 31, 2009 the unamortized portion of the deferred compensation totaled $100,000



NOTE 6  STOCKHOLDERS EQUITY



The Companys capitalization is 100,000,000 common shares with a par value of $0.0001 per share.



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.



2008 Transactions



On February 27, 2008 the Company issued 25,000 restricted common shares with a fair value of $16,250 to a newly appointed director for his current services.



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On May 27, 2008, the Company issued 294,083 shares of Legacy Wine & Spirits International Ltd. common stock in satisfaction of $147,041 owed to nine (9) related parties.  The issuance price of the common stock was $0.50 per share as agreed  between the debtors and Legacy Wine & Spirits International Ltd. The fair market value of those shares on the date of issue was $0.95 per share, resulting in interest on the settlement of debt in the

amount of $132,337.



On June 12, 2008, the Company completed the closing of the first phase in connection with a Private Placement (the Private Placement) of its securities to certain accredited investors for aggregate gross proceeds of $460,000. The investors purchased an aggregate of 920,000 shares of the Company at a price of $0.50 per share and these shares were issued subject to restrictions under Rule 144. The Company is now proceeding with the second phase in connection with a Private Placement, which will raise an additional $540,000 through the issuance of 720,000 shares of the Registrant at a price of $0.75 per share for grand total proceeds of $1,000,000.



On June 13, 2008, the Company issued 1,000,000 restricted common shares valued at $960,000 to acquire a 15 year general license to import, bottle, blend, manufacture & distribute wine and spirits throughout China.



On August 19, 2008, the Company issued 85,000 shares of Legacy Wine & Spirits International Ltd. common stock in satisfaction of $42,500 owed to three (3) related parties.  The issuance price of the

common stock was $0.50 per share as agreed between the debtors and Legacy Wine & Spirits International Ltd. The fair market value of those shares on the date of issue was $0.70 per share, resulting in interest on the settlement of debt in the amount of $17,000.



On September 16, 2008, the Company issued 5,000 restricted common shares valued at $2,550 to a new director for directors fees.



On October 7, 2008, the Company issued 6,000 restricted common shares for cash in the amount of $3,000 for a previous share subscription with respect to the second phase of a private placement as described above.



On October 22, 2008, the Company received proceeds of $97,500 for the issue of 162,500 shares under the Companys 2008 Employee Stock Option Incentive 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 period1720,0000.25-Exercised during the period( 1,720,000)0.25-Balance, December 31, 2009-$                --






-25-



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.



2008 Stock Options

During the year ended ended December 31, 2008, the Company granted a total of 162,500, 5 year common stock options at an exercise price of $0.60 per share.  The Company recognized stock-based compensation of $4,875 in accordance with SFAS 123R which represented the fair value of stock options granted to consultants in exchange for services rendered to the Company.



(c)

The Companys stock option activity is as follows:



Number of optionsWeighted Average Exercise PriceWeighted Average Remaining Contractual LifeBalance, December 31, 2007-Granted during 2008162,5000.605 yearsExercised during 2008(162,500)Balance, December 31, 2008-


(d)

As of December 31, 2008, there were 617,500 stock options available for grant under the Companys 2008 Stock Incentive and Option Plan.

NOTE 8  RELATED PARTY TRANSACTIONS

During the year ended December 31, 2009, the Company incurred expenses for consulting fees of $115,000 (2008 - $20,000) to a Company controlled by a significant shareholder and $9,189 (2008 - $23,781) for directors fees.



During the year ended December 31, 2009, the Company incurred expenses for services of $120,000 (2008 - $Nil) to two companies controlled by a significant shareholders pursuant to service contracts (See Note 5).



During year ended December 31, 2009, the Company incurred expenses for rent of $27,612 (2008 - $12,000) to a Company controlled by a significant shareholder.



The following amounts are due to related parties:

|                                  |                    |                  
|--------------------------------- | ------------------ | -----------------
|                                  | December 31,
2009  | December 31,
2008
|                                  |                    |                  
|Organa Gardens International Inc. | $         131,372  | $         116,631
|Golden Spirit Enterprises Ltd.    | 72,691             | 31,331           
|Significant shareholders          | 9,149              | 20,003           
|                                  |                    |                  
|                                  | $          213,212 | $         167,965



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.



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NOTE 9 - 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, 2009, the Company has combined net operating losses carried forward totaling approximately $3,451,000 for tax purposes which expire through 2029. 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, 2009Year ended
    December 31, 2008Federal 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)%


NOTE 9 - INCOME TAXES (continued)



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, 2008  | Year ended
December 31, 2007
|                                          |                           |                               |                             
|                                          |                           |                               |                             
|Loss before income taxes                  | $         (568,263)       | $            (668,639)       
|Corporate tax rate                        | 35.00%                    | 35.00%                       
|                                          |                           |                               |                             
|Expected tax expense (recovery)           | (198,892)                 | (234,024)                    
|Non-deductable stock based compensation   | 19,350                    | 4,875                        
|Unrecognized loss carry forward and other | 179,542                   | 229,149                      
|                                          |                           |                               |                             
|Income tax provision                      | $                       - | $                           -





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The Companys tax-effected deferred income tax assets and liabilities are estimated as follows:



20092008Non-capital loss carry forwards$-$-Valuation allowance--Net deferred tax asset$-$-










NOTE 10- SUPPLEMENTARY CASH FLOW INFORMATION AND NON-CASH INVESTING AND   FINANCING ACTIVITIES



Year ended December 31,For the period from February 19, 1999 (inception) to20092008December 31 ,2009Cash paid during the period for:Interest$                    -$                   -$                    -Income taxes$                    -$                   -$                    -Shares issued for other intangible assets$                     -$        960,000$         960,000Shares issued for debt settlement$         192,300$        189,541$        803,589Shares issued for deferred compensastion$         240,000$                    -$        240,000






During the year ending December 31, 2009 the Company issued:

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.



During the year ending December 31, 2008 the Company issued:

The Company issued 30,000 restricted common shares valued at $ 19,250 to two Directors.

The Company issued 379,083 restricted common shares valued at $ 338,840 to settle debt.

The Company issued 1,000,000 restricted common shares valued at $ 960,000 to acquire a liquor distribution license.

The Company also received proceeds on the exercise of 162,500 stock options totaling $97,500.

The Company issued 926,000 common shares at a price of $0.50 for proceeds of $463,000 pursuant to a private placement.





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NOTE 11  COMMITMENTS AND CONTINGENCIES



As of August 1, 2002, Legacy Wine & Spirits International Ltd. has leased 1250 sq. ft of office space from Holm Investments Ltd. at $1,000 per month for a period of 3 years and has been renewed for an additional 3 years at $1,100 per month. The current tenancy agreement expired August 1, 2008 and was renewed for 3 additional years at $1,100 per month. Effective September 1, 2008, the Company has also leased an additional 900 sq. ft office from 1063244 Alberta Ltd. for a $1,100.00 per month on a month to month basis. As of October 15, 2008, the Company has leased it wine store in Tianjin for a period of 10years (renewable for an additional 5 years), at $1,225 per month. See table below for Tianjin lease schedule.



Tianjin Store20092010201120122013TOTALLease rental$14,700$14,700$14,700$14,700$14,700$73,500






NOTE 12  SUBSEQUENT EVENTS REPORTED TO APRIL 8, 2010





In January, 2010, the Company issued 200,000 restricted commons shares valued ant $14,000 pursuant to a consulting services contract with a non-related party.



On February, 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. In March, 2010, 3,000,000 stock options were granted and immediately exercised for settlement of debt to related parties in the amount of $90,000.



In 2010, the Company issued 6,195,000 shares at prices between $0.03 - $0.06 per share pursuant to the Companys 2008, 2009 and 2010 Stock Incentive and Option Plans for settlement of debt to related parties of $214,700.



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.





-29-

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 evaluation, our management concluded that our internal control over financial reporting was effective as of December 31, 2009. Further, this evaluation did not identify any significant changes to our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, the Companys internal control over financial reporting.



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, 2009 that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.



Code of Ethics



We intend to adopt a code of ethics in 2010 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.



-30-

ITEM 9B.    OTHER INFORMATION



Not applicable.



PART III

ITEM 10.    DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE





1. Officers and Directors of the Company.







DATE OF APPOINTMENT

NAME

AGE    POSITION

TO BOARD OF DIRECTORS

- ------------------------------------------------------------------------------------------------------------------

Christopher Scheive        47

President & Director & CEO

November 18, 2008





Jaclyn Cruz

29

Secretary, Treasurer

August 18, 2008

& Director & CFO



The chart above specifies Legacy Wine & Spirits International Ltd. 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.



Christopher Scheive is a business entrepreneur based in Quebec.



Jaclyn Cruz is a notary public based in New York



-31-





Section 16(a) Beneficial Ownership Reporting Compliance. We believe that our officers, directors, and principal shareholders have not filed all reports required to be filed 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).

ITEM 11.    EXECUTIVE COMPENSATION





Name of Individual or          Capacities in which

Aggregate Remuneration

Identity of Group           Remuneration was received

For 2009

For 2008



------------------------------   -----------------------------------------

--------------------------------------

Christopher Scheive

Director, President

$  7,000

$ 1,000



Jaclyn Cruz



Director , Sec.,Treas.                            $  2,190

$ 3,500







Compensation of Directors. Currently, Mr.Scheive and Ms. Cruz, Directors of Legacy Wine & Spirits International Ltd. and are paid on an occasional basis.



Stock Based Compensation



During the year ended December 31, 2009, $19,350 (2008-$4,875) 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. 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. We do expect further stock-based compensation in 2010.



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.



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



The following table sets forth information as of December 31, 2009, with respect to the ownership of the Legacy Wine & Spirits International Ltd.'s common stock by each person known by Legacy Wine & Spirits International Ltd. to be the beneficial owner of more than five percent (5%) of Legacy Wine & Spirits International Ltd.'s common stock, by each director and officer and by all officers and directors as a group.



Name of



Address of

Amount of Shares      % of Outstanding

Beneficial Holder

Beneficial Holder

Beneficially Owned

Common Stock

- ------------------------------------------------------------------------------------------------------------------------------------------



Cede & Co.



The Depository Trust Co



17,102,983 (1)



75.20 %



PO Box 222 Bowling Green Stn.



New York, NY 10272



Christopher Scheive



400 Blvd. Thomas

-

0.00

President /Director /CEO

Unit 400 Lachute, Quebec,

J8H 1V7





Jaclyn Cruz



P.O. Box 63

5,000                0.0002%

Sec,Treas/.Director/CFO

Farmingville, New York

11738







All directors and Officers as a group



5,000

0.0002%







(1) The beneficial owners of these shares are not known to Legacy Wine & Spirits International Ltd.

Beneficial ownership is determined in accordance with the rules of the Securities and Exchange Commission and generally includes voting or investment power with respect to securities.





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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.



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



During the year ended December 31, 2009, the Company incurred expenses for consulting fees of $115,000 (2008 - $20,000) to a Company controlled by a significant shareholder and $9,189 (2008 - $23,781) for directors fees.



During the year ended December 31, 2009, the Company incurred expenses for services of $120,000 (2008 - $Nil) to two companies controlled by a significant shareholders pursuant to service contracts.



During year ended December 31, 2009, the Company incurred expenses for rent of $27,612 (2008 - $12,000) to a Company controlled by a significant shareholder.





The following amounts are due to related parties:

December 31,
    2009December 31,
    2008Organa Gardens International Inc.$      131,372$      116,631Golden Spirit Enterprises Ltd.72,69131,331Significant shareholders9,14920,003$       213,212$      167,965




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:

2009: $36,000

2008: $30,000



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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.

2009: $1,000

2008: $800



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.

2008: $0

2007: $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.

2009: $0

2008: $0



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

None





-34-

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 12, 2010



Legacy Wine & Spirits International Ltd.

a Delaware corporation



By:

/s/:Chirstopher Scheive



Christopher Scheive

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/: Christopher Scheive

------------------------------------

Date: April 12, 2010

Christopher Scheive

President and a Director



By: /s/ Jaclyn Cruz

-------------------------------------



Date: April 12, 2009

Jaclyn Cruz, Director, Secretary & Treasurer

By: /s/ Jaclyn Cruz



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