SECURITIES
AND EXCHANGE COMMISSION
 Washington,
D.C. 20549
 
 FORM
10-Q
 
 [x]
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
 SECURITIES
EXCHANGE ACT OF 1934
 
 For the
Quarterly period ended   March 31,
2009
 
 []
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
 SECURITIES
EXCHANGE ACT OF 1934
 
 Commission File No.
0-52997
 
 GREAT
SPIRITS, INC.
 (Exact
Name of Registrant as specified in its charter)
 
 Colorado
              20-5572519(State
      or other jurisdiction
              (IRS
      Employer File Number)of
      incorporation)
 
 215 N.
Washington Street
 Monte
Vista,
Colorado                                                                                                           81144
 (Address
of principal executive
offices)                                                                                                                     (zip
code)
 
 (575)
770-1157
 (Registrant's
telephone number, including area code)
 
 Indicate
by check mark whether the registrant: (1) filed all reports required to be filed
by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for
such shorter period that the registrant was required to file such reports); and
(2) has been subject to such filing requirements for the past 90
days.    Yes [X]  No [ ]
 
 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(Section 232.405 of
this chapter) during the preceding 12 months(or such shorter period that the
registrant was required to submit and post such files. Yes []  No [
]
 
 Indicate
by check mark whether the registrant is a large accelerated filer, a
non-accelerated filer, or a smaller reporting company. See definitions of “large
accelerated filer,” “accelerated filer,” and “small reporting company” in Rule
12b-2 of the Exchange Act.
 
 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)  Yes []    No
[X]
  The
number of shares outstanding of the registrant's common stock, as of the latest
practicable date, April 1, 2009was
8,248,020.
  
 
 
 FORM
10-Q
 
 Great
Spirits, Inc.
 
 TABLE OF
CONTENTS
 PART
      I  FINANCIAL INFORMATIONItem
      1. Financial Statements for the period ended March 31,
2009Balance
      Sheets (Unaudited)
                    4Statements
      of Operations (Unaudited)
                    5Statements
      of Shareholder's Equity (Unaudited)
                    7Statements
      of Cash Flows (Unaudited)
                    8Notes
      to Financial Statements
                    9Item
      2. Management’s Discussion and Analysis and Plan of
    Operation
                    10Item
      3. Quantitative and Qualitative Disclosures About Market
    Risk
                    12Item
      4. Controls and Procedures
                    12Item
      4T. Controls and Procedures
                    12PART
      II  OTHER INFORMATIONItem
      1. Legal Proceedings
                    13Item
      1A. Risk Factors
                    13Item
      2. Unregistered Sales of Equity Securities and Use of
    Proceeds
                    16Item
      3. Defaults Upon Senior Securities
                    16Item
      4. Submission of Matters to a Vote of Security Holders
                    16Item
      5. Other Information
                    17Item
      6. Exhibits
                    17Signatures
                    18
  
 -
2 -
 
 
 PART
I  FINANCIAL INFORMATION
 
 References
in this document to "us," "we," or "Company" refer to Great Spirits, Inc. and
its subsidiary.
 
 ITEM
1.  FINANCIAL STATEMENTS
 
  
 
 
 GREAT
SPIRITS, INC.
 (A
Development Stage Company)
 
 FINANCIAL
STATEMENTS
 (Unaudited)
 
 Quarter
Ended March 31, 2009






-
3 -




Great
Spirits Inc.


Consolidated
Balance Sheets
 (A
Development Stage Company)
 Unaudited
                                                          
                                                          
                                                          AuditedMarch
                                                          
                                                          
                                                          June31, 2009
                                                          
                                                          
                                                          
                                                          30, 2008ASSETSCurrent
      Assets:Cash
      and cash equivalents
                                                          
                                                          $
                                                          1,543
                                                          
                                                          
                                                          $
                                                          9,130Total
      Current Assets
                                                          
                                                          
                                                          1,543
                                                          
                                                          
                                                          
                                                          9,130TOTAL
      ASSETS
                                                          
                                                          $
                                                          1,543
                                                          
                                                          
                                                          $
                                                          9,130LIABILITIES AND SHAREHOLDERS'
      EQUITYAccounts
      payable
                                                          
                                                          $
                                                          3,671
                                                          
                                                          
                                                          $
                                                          2,237Advances
      from officer
                                                          
                                                          
                                                          65
                                                          
                                                          
                                                          
                                                          65Total
      current liabilities
                                                          
                                                          
                                                          3,736
                                                          
                                                          
                                                          
                                                          2,302Total
      Liabilities$
                                                          3,736
                                                          
                                                          
                                                          $
                                                          2,302SHAREHOLDERS' EQUITYPreferred
      stock, $.10 par value per share;Authorized
      1,000,000 Shares; Issuedand
      outstanding -0- shares.
                                                          
                                                          
                                                          -
                                                          
                                                          
                                                          
                                                          -Common
      Stock, $.001 per share;Authorized
      50,000,000 Shares; Issuedand
      outstanding 8,248,020 shares
                                                          
                                                          
                                                          8,248
                                                          
                                                          
                                                          
                                                          8,248Capital
      paid in excess of par value
                                                          
                                                          
                                                          33,437
                                                          
                                                          
                                                          
                                                          33,437(Deficit)
      accumulated during the development stage
                                                          
                                                          
                                                          (43,878
                                                          )
                                                          
                                                          
                                                          (34,857
                                                          )TOTAL
      SHAREHOLDERS' EQUITY
                                                          
                                                          
                                                          (2,193
                                                          )
                                                          
                                                          
                                                          6,828TOTAL
      LIABILITIES AND SHAREHOLDERS' EQUITY
                                                          
                                                          $
                                                          1,543
                                                          
                                                          
                                                          $
                                                          9,130
  See
Accompanying Notes To These Unaudited Financial Statements.
  -
4 -
  Great
Spirits Inc.
 Unaudited
Consolidated Statement Of Operations
 (A
Development Stage Company)
 UnauditedUnaudited
                                    
                                    
                                    Unaudited
                                    
                                    
                                    September
      26,Nine
      month
                                    
                                    
                                    Nine
      month
                                    
                                    
                                    2005
      Inceptionperiod
      ended
                                    
                                    
                                    period
      ended
                                    
                                    
                                    throughMarch
      31,
                                    
                                    
                                    March
      31,
                                    
                                    
                                    March
      31,2009
                                    
                                    
                                    2008
                                    
                                    
                                    2009(Unaudited)
                                    
                                    
                                    (Unaudited)
                                    
                                    
                                    (Unaudited)Revenue:
                                    
                                    $
                                    -
                                    
                                    
                                    $
                                    -
                                    
                                    
                                    $
                                    -General
      & Administrative ExpensesAccounting
                                    
                                    
                                    7,250
                                    
                                    
                                    
                                    5,500
                                    
                                    
                                    
                                    14,250Bank
      charges
                                    
                                    
                                    -
                                    
                                    
                                    
                                    19
                                    
                                    
                                    
                                    27Consulting
                                    
                                    
                                    -
                                    
                                    
                                    
                                    2,000
                                    
                                    
                                    
                                    9,500Legal
                                    
                                    
                                    -
                                    
                                    
                                    
                                    -
                                    
                                    
                                    
                                    7,500Lincenses
                                    
                                    
                                    -
                                    
                                    
                                    
                                    -
                                    
                                    
                                    
                                    375Office
                                    
                                    
                                    1,171
                                    
                                    
                                    
                                    798
                                    
                                    
                                    
                                    5,621Research
      & development
                                    
                                    
                                    -
                                    
                                    
                                    
                                    4,356
                                    
                                    
                                    
                                    800Stock
      transfer
                                    
                                    
                                    600
                                    
                                    
                                    
                                    420
                                    
                                    
                                    
                                    5,805Total
      G & A
                                    
                                    
                                    9,021
                                    
                                    
                                    
                                    13,093
                                    
                                    
                                    
                                    43,878Net
      (Loss)
                                    
                                    $
                                    (9,021
                                    )
                                    
                                    $
                                    (13,093
                                    )
                                    
                                    $
                                    (43,878
                                    )Basic
      (Loss) per common share
                                    
                                    
                                    (0.00
                                    )
                                    
                                    
                                    (0.00
                                    )
                                    
                                    
                                    (0.01
                                    )Weighted
      Average Common Shares Outstanding
                                    
                                    
                                    8,248,020
                                    
                                    
                                    
                                    8,248,020
                                    
                                    
                                    
                                    8,248,020
  See
Accompanying Notes To These Unaudited Financial Statements.
  -
5 -
  Great
Spirits Inc.
 Unaudited
Consolidated Statement Of Operations
 (A
Development Stage Company)
  
 Unaudited
                              
                              
                              Unaudited3
      Months
                              
                              
                              3
      MonthsEnded
                              
                              
                              EndedMarch
                              
                              
                              March31, 2009
                              
                              
                              
                              31, 2008Revenue:
                              
                              $
                              -
                              
                              
                              $
                              -General
      & Administrative ExpensesAccounting
                              
                              
                              1,500
                              
                              
                              
                              1,500Licensing
                              
                              
                              -
                              
                              
                              
                              -Office
                              
                              
                              249
                              
                              
                              
                              50Printing
                              
                              
                              -
                              
                              
                              
                              1,045Stock
      transfer
                              
                              
                              -
                              
                              
                              
                              -Total
      G & A
                              
                              
                              1,749
                              
                              
                              
                              2,595Net
      (Loss)
                              
                              $
                              (1,749
                              )
                              
                              $
                              (2,595
                              )Basic
      (Loss) per common share
                              
                              
                              (0.00
                              )
                              
                              
                              (0.00
                              )Weighted
      Average Common Shares Outstanding
                              
                              
                              8,248,020
                              
                              
                              
                              8,248,020
  See
Accompanying Notes To These Unaudited Financial Statements.
  -
6 -
  
 Great Spirits, Inc.(A
      Development Stage Company)Consolidated
      Statements of Shareholders' EquityNumber
      OfCommonShares Issued (1)
                                                                        
                                                                        
                                                                        CommonStock
                                                                        
                                                                        
                                                                        Capital
      Paidin Excessof Par Value
                                                                        
                                                                        
                                                                        RetainedEarnings(Deficit)
                                                                        
                                                                        
                                                                        TotalBalance
      at September 26, 2005 (Inception)
                                                                        
                                                                        
                                                                        -
                                                                        
                                                                        
                                                                        $
                                                                        -
                                                                        
                                                                        
                                                                        $
                                                                        -
                                                                        
                                                                        
                                                                        $
                                                                        -
                                                                        
                                                                        
                                                                        $
                                                                        -Net
      Income (Loss)
                                                                        
                                                                        
                                                                        -
                                                                        
                                                                        
                                                                        
                                                                        -
                                                                        
                                                                        
                                                                        
                                                                        -
                                                                        
                                                                        
                                                                        
                                                                        -
                                                                        
                                                                        
                                                                        
                                                                        -Balance
      at June 30, 2006
                                                                        
                                                                        
                                                                        -
                                                                        
                                                                        
                                                                        $
                                                                        -
                                                                        
                                                                        
                                                                        $
                                                                        -
                                                                        
                                                                        
                                                                        $
                                                                        -
                                                                        
                                                                        
                                                                        $
                                                                        -July
      1, 2006 issued 7,500,000shares
      of par value $.001 common stockto
      founders for services
                                                                        
                                                                        
                                                                        7,500,000
                                                                        
                                                                        
                                                                        
                                                                        7,500
                                                                        
                                                                        
                                                                        
                                                                        -
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        7,500September
      1, 2006 issued 500,000shares
      of par value $.001 common stockfor
      cash of $500 or $.001 per share
                                                                        
                                                                        
                                                                        500,000
                                                                        
                                                                        
                                                                        
                                                                        500
                                                                        
                                                                        
                                                                        
                                                                        -
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        500November
      10, 2006 issued 20,000shares
      of par value $.001 common stockfor
      cash of $3,000 or $.15 per share
                                                                        
                                                                        
                                                                        20,000
                                                                        
                                                                        
                                                                        
                                                                        20
                                                                        
                                                                        
                                                                        
                                                                        2,980
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        3,000November
      24, 2006 issued 6,670shares
      of par value $.001 common stockfor
      cash of $1,000.50 or $.15 per share
                                                                        
                                                                        
                                                                        6,670
                                                                        
                                                                        
                                                                        
                                                                        7
                                                                        
                                                                        
                                                                        
                                                                        994
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        1,001December
      11, 2006 issued 13,340shares
      of par value $.001 common stockfor
      cash of $2,001 or $.15 per share
                                                                        
                                                                        
                                                                        13,340
                                                                        
                                                                        
                                                                        
                                                                        13
                                                                        
                                                                        
                                                                        
                                                                        1,988
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        2,001December11,
      2006 issued 13,670shares
      of par value $.001 common stockfor
      cash of $2,050 or $.15 per share
                                                                        
                                                                        
                                                                        13,670
                                                                        
                                                                        
                                                                        
                                                                        14
                                                                        
                                                                        
                                                                        
                                                                        2,036
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        2,050January
      3, 2007 issued 13,340shares
      of par value $.001 common stockfor
      cash of $2,001 or $.15 per share
                                                                        
                                                                        
                                                                        13,340
                                                                        
                                                                        
                                                                        
                                                                        13
                                                                        
                                                                        
                                                                        
                                                                        1,988
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        2,001June
      18, 2007 issued 147,000shares
      of par value $.001 common stockfor
      cash of $36,750 or $.25 per share
                                                                        
                                                                        
                                                                        147,000
                                                                        
                                                                        
                                                                        
                                                                        147
                                                                        
                                                                        
                                                                        
                                                                        36,603
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        36,750Deferred
      offering costs
                                                                        
                                                                        
                                                                        -
                                                                        
                                                                        
                                                                        
                                                                        -
                                                                        
                                                                        
                                                                        
                                                                        (21,052
                                                                        )
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        (21,052
                                                                        )June
      24, 2007 issued 34,000shares
      of par value $.001 common stockfor
      cash of $8,500 or $.25 per share
                                                                        
                                                                        
                                                                        34,000
                                                                        
                                                                        
                                                                        
                                                                        34
                                                                        
                                                                        
                                                                        
                                                                        8,466
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        8,500Net
      (Loss)
                                                                        
                                                                        
                                                                        -
                                                                        
                                                                        
                                                                        
                                                                        -
                                                                        
                                                                        
                                                                        
                                                                        -
                                                                        
                                                                        
                                                                        
                                                                        (13,281
                                                                        )
                                                                        
                                                                        
                                                                        (13,281
                                                                        )Balance
      at June 30, 2007
                                                                        
                                                                        
                                                                        8,248,020
                                                                        
                                                                        
                                                                        $
                                                                        8,248
                                                                        
                                                                        
                                                                        $
                                                                        34,003
                                                                        
                                                                        
                                                                        $
                                                                        (13,281
                                                                        )
                                                                        
                                                                        $
                                                                        28,970Deferred
      offering costs
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        (566
                                                                        )
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        
                                                                        (566
                                                                        )Net
      (Loss)
                                                                        
                                                                        
                                                                        -
                                                                        
                                                                        
                                                                        
                                                                        -
                                                                        
                                                                        
                                                                        
                                                                        -
                                                                        
                                                                        
                                                                        
                                                                        (21,576
                                                                        )
                                                                        
                                                                        
                                                                        (21,576
                                                                        )Balance
      at June 30, 2008
                                                                        
                                                                        
                                                                        8,248,020
                                                                        
                                                                        
                                                                        
                                                                        8,248
                                                                        
                                                                        
                                                                        
                                                                        33,437
                                                                        
                                                                        
                                                                        
                                                                        (34,857
                                                                        )
                                                                        
                                                                        
                                                                        6,828-
                                                                        
                                                                        
                                                                        
                                                                        -
                                                                        
                                                                        
                                                                        
                                                                        -
                                                                        
                                                                        
                                                                        
                                                                        (9,021
                                                                        )
                                                                        
                                                                        
                                                                        (9,021
                                                                        )Balance
      at March 31, 2009 - Unaudited
                                                                        
                                                                        
                                                                        8,248,020
                                                                        
                                                                        
                                                                        $
                                                                        8,248
                                                                        
                                                                        
                                                                        $
                                                                        33,437
                                                                        
                                                                        
                                                                        $
                                                                        (43,878
                                                                        )
                                                                        
                                                                        $
                                                                        (2,193
                                                                        )
 ______________
 
 (1) As
restated for a 75,000 for 1 recapitalization on September 1, 2006
 
 See
Accompanying Notes To These Unaudited Financial Statements.
  -
7 -
  
 Great
      Spirits, Inc.(A
      Development Stage Company)Unaudited
      Consolidated Statements of Cash FlowsUnauditedUnaudited
                                                  
                                                  
                                                  Unaudited
                                                  
                                                  
                                                  September
      26,Nine
      month
                                                  
                                                  
                                                  Nine
      month
                                                  
                                                  
                                                  2005
      Inceptionperiod
      ended
                                                  
                                                  
                                                  period
      ended
                                                  
                                                  
                                                  throughMarch
      31,
                                                  
                                                  
                                                  March
      31,
                                                  
                                                  
                                                  March
      31,2009
                                                  
                                                  
                                                  2008
                                                  
                                                  
                                                  2009(Unaudited)
                                                  
                                                  
                                                  (Unaudited)
                                                  
                                                  
                                                  (Unaudited)Net
      (Loss)
                                                  
                                                  $
                                                  (9,021
                                                  )
                                                  
                                                  $
                                                  (13,093
                                                  )
                                                  
                                                  $
                                                  (43,878
                                                  )Adjustments
      to reconcile decrease in net assets to net cashprovided
      by operating activities:Stock
      issued for services
                                                  
                                                  
                                                  -
                                                  
                                                  
                                                  
                                                  -
                                                  
                                                  
                                                  
                                                  7,500Increase
      (Decrease) in accounts payable
                                                  
                                                  
                                                  1,434
                                                  
                                                  
                                                  
                                                  (1,677
                                                  )
                                                  
                                                  
                                                  3,671Net
      cash (used) in operation activities
                                                  
                                                  
                                                  (7,587
                                                  )
                                                  
                                                  
                                                  (14,770
                                                  )
                                                  
                                                  
                                                  (32,707
                                                  )Cash
      flows from investing activities:Advances
      received from officer
                                                  
                                                  
                                                  -
                                                  
                                                  
                                                  
                                                  -
                                                  
                                                  
                                                  
                                                  1,065Advances
      paid to officer
                                                  
                                                  
                                                  -
                                                  
                                                  
                                                  
                                                  65
                                                  
                                                  
                                                  
                                                  (1,000
                                                  )Net
      cash (used) in investing activities
                                                  
                                                  
                                                  -
                                                  
                                                  
                                                  
                                                  65
                                                  
                                                  
                                                  
                                                  65Cash
      flows from financing activities:Issuance
      of common stock
                                                  
                                                  
                                                  -
                                                  
                                                  
                                                  
                                                  -
                                                  
                                                  
                                                  
                                                  45,251Deferred
      offering costs
                                                  
                                                  
                                                  -
                                                  
                                                  
                                                  
                                                  (566
                                                  )
                                                  
                                                  
                                                  (11,066
                                                  )Net
      cash provided from financing activities
                                                  
                                                  
                                                  -
                                                  
                                                  
                                                  
                                                  (566
                                                  )
                                                  
                                                  
                                                  34,185Net
      increase in cash
                                                  
                                                  
                                                  (7,587
                                                  )
                                                  
                                                  
                                                  (15,271
                                                  )
                                                  
                                                  
                                                  1,543Cash
      at beginning of period
                                                  
                                                  
                                                  9,130
                                                  
                                                  
                                                  
                                                  33,605
                                                  
                                                  
                                                  
                                                  -Cash
      at end of period
                                                  
                                                  $
                                                  1,543
                                                  
                                                  
                                                  $
                                                  18,334
                                                  
                                                  
                                                  $
                                                  1,543Supplemental
      disclosure information:Stock
      issued for services
                                                  
                                                  $
                                                  -
                                                  
                                                  
                                                  $
                                                  -
                                                  
                                                  
                                                  $
                                                  7,500Cash
      paid for:Interest
                                                  
                                                  $
                                                  -
                                                  
                                                  
                                                  $
                                                  -
                                                  
                                                  
                                                  $
                                                  -Income
      taxes
                                                  
                                                  $
                                                  -
                                                  
                                                  
                                                  $
                                                  -
                                                  
                                                  
                                                  $
                                                  -Cash
      paid for interest
                                                  
                                                  $
                                                  -
                                                  
                                                  
                                                  $
                                                  -
                                                  
                                                  
                                                  $
                                                  -Cash
      paid for income taxes
                                                  
                                                  $
                                                  -
                                                  
                                                  
                                                  $
                                                  -
                                                  
                                                  
                                                  $
                                                  -
 
 See
Accompanying Notes To These Unaudited Financial Statements.
  -
8 -
  Great
Spirits Inc
 Notes To
Unaudited Financial Statements
 For
The Three Month Period  and Nine Month Period Ended March 31,
2009
   Note
1 - Unaudited Financial Information
  The
unaudited financial information included for the three month and nine month
interim period ended March 31, 2009 were taken from the books and records
without audit. However, such information reflects all adjustments (consisting
only of normal recurring adjustments, which are of the opinion of management,
necessary to reflect properly the results of interim period presented). The
results of operations for the three month and nine month period ended March 31,
2009 are not necessarily indicative of the results expected for the fiscal year
ended June 30, 2009.
   Note
2 - Financial Statements
  For a
complete set of footnotes, reference is made to the Company’s Report on Form
10K-SB for the year ended June 30, 2008 as filed with the Securities and
Exchange Commission and the audited financial statements included
therein.
  -
9 -
 
 ITEM
2.   MANAGEMENT’S DISCUSSION AND ANALYSIS AND PLAN OF
OPERATION
 
 The
following discussion of our financial condition and results of operations should
be read in conjunction with, and is qualified in its entirety by, the
consolidated financial statements and notes thereto included in, Item 1 in this
Quarterly Report on Form 10-Q. This item contains forward-looking statements
that involve risks and uncertainties. Actual results may differ materially from
those indicated in such forward-looking statements.
 
 Forward-Looking
Statements
  This
Quarterly Report on Form 10-Q and the documents incorporated herein by reference
contain forward-looking statements.  Such forward-looking statements
are based on current expectations, estimates, and projections about our
industry, management beliefs, and certain assumptions made by our
management.  Words such as “anticipates”, “expects”, “intends”,
“plans”, “believes”, “seeks”, “estimates”, variations of such words, and similar
expressions are intended to identify such forward-looking
statements.  These statements are not guarantees of future performance
and are subject to certain risks, uncertainties, and assumptions that are
difficult to predict; therefore, actual results may differ materially from those
expressed or forecasted in any such
forward-looking  statements.  Unless required by law, we
undertake no obligation to update publicly any forward-looking statements,
whether as a result of new information, future events, or
otherwise.  However, readers should carefully review the risk factors
set forth herein and in other reports and documents that we file from time to
time with the Securities and Exchange Commission, particularly the Annual
Reports on Form 10-KSB, Quarterly reports on Form 10-Q and any Current Reports
on Form 8-K.
  Overview
and History
  We are a
Colorado corporation. We were incorporated on August 31, 2006. Our
wholly-owned subsidiary was formed in September, 2005. Our proposed business is
to distill and market to the public a premium-priced potato vodka. We are a
holding company to Rocky Mountain Distilleries, Inc., a wholly-owned subsidiary,
which was incorporated in September, 2005 and is the actual operating company.
Both we and our subsidiary are headquartered in Monte Vista, Colorado. We
acquired the capital stock of Rocky Mountain Distilleries, Inc. in a tax-free
exchange under the Internal Revenue Code in September, 2006.
  In June,
2007, we completed a registered offering of our common shares under the
provisions of the Colorado securities laws and under an exemption from the
federal securities laws. We sold a total of 181,000 common shares at a price of
$0.25 per share to a total of forty investors. We raised a total of $45,250 in
this offering.
 
 We have
not been subject to any bankruptcy, receivership or similar
proceeding.
 
 Our
address is 215 N. Washington Street, Monte Vista, Colorado 81144Our telephone number is
(575) 770-1157.
 
 Results
of Operations
 
 Revenue. We have had no revenue since inception, including for the three
months ended March 31, 2009.
 
 Operating Expenses. We incurred operating expenses of $1,749 for the
three months ended March 31, 2009 compared to $ 2,595 for the three months ended
March 31, 2008.   We incurred operating expenses of $9,021 for
the nine months ended March 31, 2009 compared to operating expenses of $13,093 for the nine
months ended March 31, 2008.
 
 Our operating expenses are comprised solely of general and administrative
expenses. The primary components of general and administrative expenses are the
expenses of our corporate office, professional fees, general and administrative
expenses. The increase in operating expenses is directly related to the increase
in salaries during the relevant periods.
 
 Gross Profit (Loss). We had no gross profit since inception, including
for the three months ended March 31, 2009.
 
 -
10 -
 
 
 Net Loss. We incurred a net loss of $1,749 for the three months ended
March 31, 2009 compared to anet
loss of $ 2,595 for the three months ended March 31, 2008. We incurred a
net loss of $9,021 for the nine months ended March 31, 2009 compared to a net
loss of $13,093 for the nine months ended March 31, 2008.
 
 Liquidity
and Capital Resources
 
 As of March 31, 2009, we had cash totaling $1,543.
 
 For the
nine months ended March 31, 2009, we had net cash of $7,587 used for operating
activities, compared to $14,770for the nine months ended
March 31, 2008.
 
 For
the nine months ended March 31, 2009, we had net cash of $-0- provided or used
for investing activities, compared to $65 for the nine months ended March 31,
2008.
 
 For
the nine months ended March 31, 2009, we had net cash of $-0- provided or used
by financing activities, compared to $566 used by financing activities for the
nine months ended March 31, 2008.
 
 Over the
next twelve months our capital costs will be approximately $10,000 to $12,000
primarily to develop operations. We plan to buy office equipment to be used in
our operations. In the next three months, we plan to develop a relationship with
a contract distiller to begin distilling our potato vodka. At the present time,
we have no definitive agreement in place for any contract distiller. We do not
anticipate an extensive capital cost to develop this relationship. Eventually,
we want to distill our own vodka at our own distillery. However, we have no
definite plans to do so at this time and do not know what, if any, capital costs
would be involved for us.
  We
believe that we have sufficient capital in the short term for our current level
of operations. This is because we believe that we can attract sufficient product
sales and services within our present organizational structure and resources to
become profitable in our operations. Additional resources would be needed to
expand into additional locations, which we have no plans to do at this time. We
do not anticipate needing to raise additional capital resources in the next
twelve months. In the event that we need additional capital, Ms. Hyde has agreed
to loan such funds as may be necessary through December 31, 2009 for working
capital purposes.
 
 Our
principal source of liquidity will be our operations. We expect variation in
revenues to account for the difference between a profit and a loss. Also
business activity is closely tied to the U.S. economy. Because we plan to market
a vodka product, a slow down in purchases of consumer goods could have a
negative impact to our business in the future. We have no idea to what extent
this may affect us. In any case, we try to operate with minimal overhead. Our
primary activity will be to seek to develop customers and, consequently, our
sales. If we succeed in developing customers for our vodka and generating
sufficient sales, we will become profitable. We cannot guarantee that this will
ever occur. Our plan is to build our company in any manner which will be
successful.
  Off-Balance Sheet
Arrangements
  We
have not entered into any transactions with unconsolidated entities in which we
have financial guarantees, subordinated retained interests, derivative
instruments or other contingent arrangements that expose us to material
continuing risks, contingent liabilities or any other obligations under a
variable interest in an unconsolidated entity that provides us with financing,
liquidity, market risk or credit risk support.
  Critical
Accounting Policies
  Our
discussion and analysis of results of operations and financial condition are
based upon our consolidated financial statements, which have been prepared in
accordance with accounting principles generally accepted in the United States of
America. The preparation of these consolidated financial statements requires us
to make estimates and judgments that affect the reported amounts of assets,
liabilities, revenues and expenses, and related disclosure of contingent assets
and liabilities. We evaluate our estimates on an ongoing basis, including those
related to provisions for uncollectible accounts receivable, inventories,
valuation of intangible assets and contingencies and litigation. We base our
estimates on historical experience and on various other assumptions that are
believed to be reasonable under the circumstances, the results of which form the
basis for making judgments about the carrying values of assets and liabilities
that are not readily apparent from other sources. Actual results May differ from
these estimates under different assumptions or conditions.
 
 -
11 -
 
 
 The
accounting policies that we follow are set forth in Note 2 to our financial
statements as included in this prospectus. These accounting policies conform to
accounting principles generally accepted in the United States, and have been
consistently applied in the preparation of the financial
statements.
 
 Recently
Issued Accounting Pronouncements
  In
December 2004, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards ("SFAS") No. 123R "Share Based Payment." This
statement is a revision of SFAS No. 123, "Accounting for Stock-Based
Compensation" and supersedes APB Opinion No. 25, Accounting for Stock Issued to
Employees, and its related implementation guidance. SFAS No. 123R addresses all
forms of share based payment ("SBP") awards including shares issued under
employee stock purchase plans, stock options, restricted stock and stock
appreciation rights. Under SFAS No. 123R, SBP awards result in a cost that will
be measured at fair value on the awards' grant date, based on the estimated
number of awards that are expected to vest. This statement is effective for
public entities that file as Registrants, as of the beginning of the first
interim or annual reporting period that begins after December 15, 2005. We
adopted this pronouncement during the first quarter of 2005.
  In
December 2004, the FASB issued SFAS No. 153, Exchanges of Non-monetary Assets -
An Amendment of APB Opinion No. 29. The amendments made by SFAS No. 153 are
based on the principle that exchanges of non-monetary assets should be measured
based on the fair value of the assets exchanged. Further, the amendments
eliminate the narrow exception for non-monetary exchanges of similar productive
assets and replace it with a broader exception for exchanges of non-monetary
assets that do not have "commercial substance." SFAS No. 153 is effective for
non-monetary asset exchanges occurring in fiscal periods beginning after June
15, 2005. The adoption of SFAS No. 153 on its effective date did not have a
material effect on our consolidated financial statements.
  In December 2005, the FASB issued Financial Interpretation No. 47, "Accounting
for Conditional Asset Retirement Obligations - an Interpretation of FASB
Statement No. 143", which specifies the accounting treatment for obligations
associated with the sale or disposal of an asset when there are legal
requirements attendant to such a disposition. We adopted this pronouncement in
2005, as required, but there was no impact as there are no legal obligations
associated with the future sale or disposal of any assets.
  In May 2005, the FASB issued SFAS No. 154, "Accounting Changes and Error
Corrections — A Replacement of APB Opinion No. 20 and SFAS Statement No. 3".
SFAS No. 154 changes the requirements for the accounting and reporting of a
change in accounting principle by requiring retrospective application to prior
periods' financial statements of the change in accounting principle, unless it
is impracticable to do so. SFAS No. 154 is effective for accounting changes and
corrections of errors made in fiscal years beginning after December 15, 2005. We
do not expect the adoption of SFAS No. 154 to have any impact on our
consolidated financial statements.
 
 
 ITEM
3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK.
 
 None.
 
 
 ITEM
4. CONTROLS AND PROCEDURES
  Not applicable
 
 
 ITEM
4T. CONTROLS AND PROCEDURES
 
 As of the
end of the period covered by this report, based on an evaluation of our
disclosure controls and procedures (as defined in Rules 13a -15(e) and
15(d)-15(e) under the Exchange Act), our Chief Executive Officer and the Chief
Financial Officer each have concluded that our disclosure controls and
procedures are effective to ensure that information required to be disclosed by
us in our Exchange Act reports is recorded, processed, summarized, and reported
within the applicable time periods specified by the SEC’s rules and
forms.
 
 -
12 -
 
 
 There
were no changes in our internal controls over financial reporting that occurred
during our most recent fiscal quarter that have materially affected, or are
reasonably likely to materially affect, our internal control over financial
reporting.
 
 This
report does not include an attestation report of the company’s registered public
accounting firm regarding internal control over financial reporting. Identified
in connection with the evaluation required by paragraph (d) of Rule 240.13a-15
or Rule 240.15d-15 of this chapter that occurred during the registrant’s last
fiscal quarter that has materially affected, or is reasonably likely to
materially affect, the registrant’s internal control over financial
reporting.
  
 PART
II.  OTHER INFORMATION
 
 ITEM
1.  LEGAL PROCEEDINGS
 
 There are
no legal proceedings, to which we are a party, which could have a material
adverse effect on our business, financial condition or operating
results.
 
 
 ITEM
1A. RISK FACTORS
 
 You
should carefully consider the risks and uncertainties described below and the
other information in this document before deciding to invest in shares of our
common stock.
 
 The
occurrence of any of the following risks could materially and adversely affect
our business, financial condition and operating result. In this case, the
trading price of our common stock could decline and you might lose all or part
of your investment.
 
 We
have a limited operating history, have never been profitable, and may never be
profitable.  We have a history of losses.
 
 We were
formed as a Colorado business entity in August, 2006. Our wholly-owned
subsidiary was formed in September, 2005. At the present time, have a limited
operating history. There can be no guarantee that we will ever be
profitable. From our inception on September 26, 2005 through March 31,
2009, we have a history of losses.
 
 Because
we had incurred operating losses from our inception, our accountants have
expressed doubts about our ability to continue as a going concern.
  For the
period ended June 30, 2008, our accountants have expressed doubt about our
ability to continue as a going concern as a result of our continued net losses.
Our ability to achieve and maintain profitability and positive cash flow is
dependent upon:
  l
              our
      ability to begin active operations;
  l
              our
      ability to locate clients who will purchase our vodka products;
      and
  l
              our
      ability to generate revenues.
 
 Based
upon current plans, we may incur operating losses in future periods because we
may, from time to time, be incurring expenses but not generating sufficient
revenues. We expect approximately $50,000 in operating costs over the next
twelve months. We cannot guarantee that we will be successful in generating
sufficient revenues or other funds in the future to cover these operating costs.
Failure to generate sufficient revenues will cause us to go out of
business.
 
 
 -
13 -
 
 We
have a lack of liquidity and will need additional financing in the future.
Additional financing may not be available when needed, which could delay our
development or indefinitely postponed.
 
 We are
only minimally capitalized. Because we are only minimally capitalized, we expect
to experience a lack of liquidity for the foreseeable future in our proposed
operations. We will adjust our expenses as necessary to prevent cash flow or
liquidity problems. However, we expect we will need additional financing of some
type, which we do not now possess, to fully develop our operations. We expect to
rely principally upon our ability to raise additional financing, the success of
which cannot be guaranteed. We will look at both equity and debt financing,
including loans from our principal shareholder. However, at the present time, we
have no definitive plans for financing in place, other than the funds which may
be loaned to us by Ms. Hyde, our President. In the event that we need additional
capital, Ms. Hyde has agreed to loan such funds as may be necessary through
December 31, 2009 for working capital purposes. To the extent that we experience
a substantial lack of liquidity, our development in accordance with our proposed
plan may be delayed or indefinitely postponed, our operations could be impaired,
we may never become profitable, fail as an organization, and our investors could
lose some or all of their investment.
 
 As
a company with limited operating history, we are inherently a risky
investment.
 
 We have
limited operating history. Because we are a company with limited history, the
operations in which we engage in, to distill and market to the public a
premium-priced potato vodka, is an extremely risky business. An investor could
lose his entire investment.
 
 Our
operations are subject to our ability to successfully market our products. We
have no substantial history of being able to successfully market our
products.
 
 Our
operations will depend, among other things, upon our ability to develop and to
market our vodka product for sale to consumers. Further, there is the
possibility that our operations will not generate income sufficient to meet
operating expenses or will generate income and capital appreciation, if any, at
rates lower than those anticipated or necessary to sustain the investment. An
investor could lose his entire investment.
 
 There
are factors beyond our control which may adversely affect us.
 
 Our
operations may also be affected by factors which are beyond our control,
principally general market conditions and changing consumer
tastes.  Any of these problems, or a combination thereof, could have
affect on our viability as an entity. We may never become profitable, fail as an
organization, and our investors could lose some or all of their
investment.
 
 Intense
competition in our market could prevent us from developing revenue and prevent
us from achieving annual profitability. In either situation, we may never become
profitable, fail as an organization, and our investors could lose some or all of
their investment.
  We plan
to distill and market to the public a premium-priced potato vodka. While the
barriers to entry are significant, more importantly, it is necessary to gain a
share of the potato vodka market. The barriers to gaining a market share are
significant. We face strong competitors in all areas of our business. All
aspects of our business are highly competitive. All of our competitors are
larger than us and have greater financial resources than we do. All of our
competitors have substantially greater experience distilling and marketing to
the public premium-priced vodka, including potato vodka. Competition with these
companies could curtail price increases or could require price reductions or
significant spending on marketing and sales, any of which could adversely affect
our results of operations. Competition from larger and more established
companies is a significant threat and is expected to increase.
  Our
products could be rendered noncompetitive or obsolete. Any competition may cause
us to fail to gain or to lose market share, which could result in reduced
margins for our products. Competitive pressures may not only impair our margins
but may also impact our revenues and our growth.
  
 -
14 -
 
 We currently have no suppliers or
third party distillery contracts and may never acquire any suppliers or third
party contracts.
  We
currently have no contracts with any suppliers or third party distilleries for
the production of our product. We may never acquire either suppliers or third
party distilleries, either of which could cause our business to
fail.
  Fluctuations
in the supply and prices of raw materials could negatively impact our
financial results.
  Under
normal market conditions, raw materials for our proposed product are generally
available on the open market. From time to time, however, the prices and
availability of these raw materials may fluctuate significantly, which could
impair our ability to procure necessary products, or increase the cost of our
product. If material costs increase, and we are unable to pass along, or are
delayed in passing along, those increases to our customers, we will experience
reductions to our profit margins and our ability to generate a profit will be
reduced or eliminated completely.
  Our
success will be dependent upon our management’s efforts. We cannot sustain
profitability without the efforts of our management.
 
 Our
success will be dependent upon the decision making of our directors and
executive officers. These individuals intend to commit as much time as necessary
to our business, but this commitment is no assurance of success. The loss of any
or all of these individuals, particularly Ms. Dana Hyde our President, could
have a material, adverse impact on our operations. We have no written employment
agreements with any officers and directors, including Ms. Hyde. We have not
obtained key man life insurance on the lives of any of our officers or
directors.
 
 Our
stock has a limited public trading market and there is no guarantee a trading
market will ever develop for our securities.
 
 There has
been, and continues to be, a limited public market for our common stock. We
trade on the Over-the-Counter Bulletin Board under the trading symbol GSPS.OB.
An active trading market for our shares  has not, and may never
develop or be sustained. If you purchase shares of common stock, you may not be
able to resell those shares at or above the initial price you paid. The market
price of our common stock may fluctuate significantly in response to numerous
factors, some of which are beyond our control, including the
following:
 
 *    actual
or anticipated fluctuations in our operating results;
 
 *    changes
in financial estimates by securities analysts or our failure to perform in line
with such estimates;
 
 *    changes
in market valuations of other companies, particularly those that market services
such as ours;
 
 *    announcements
by us or our competitors of significant innovations,  acquisitions,
strategic partnerships, joint ventures or    capital
commitments;
 
 *    introduction
of product enhancements that reduce the need for our products;
 
 *    departures
of key personnel.
 
 Of our
total outstanding shares as of April 1, 2009, a total of 8,067,020, or
approximately 98%, will be restricted from immediate resale but may be sold into
the market in the near future. This could cause the market price of our common
stock to drop significantly, even if our business is doing well.
 
 As
restrictions on resale end, the market price of our stock could drop
significantly if the holders of restricted shares sell them or are perceived by
the market as intending to sell them.
 
 
 -
15 -
 
 Applicable
SEC rules governing the trading of “Penny Stocks” limit the liquidity of our
common stock, which may affect the trading price of our common
stock.
  Our
common stock is currently not quoted on in any market. If our common stock
becomes quoted, we anticipate that it will trade well below $5.00 per share. As
a result, our common stock is considered a “penny stock” and is subject to SEC
rules and regulations that impose limitations upon the manner in which our
shares can be publicly traded.  These regulations require the
delivery, prior to any transaction involving a penny stock, of a disclosure
schedule explaining the penny stock and the associated risks.  Under
these regulations, certain brokers who recommend such securities to persons
other than established customers or certain accredited investors must make a
special written suitability determination for the purchaser and receive the
written purchaser’s agreement to a transaction prior to
purchase.  These regulations have the effect of limiting the trading
activity of our common stock and reducing the liquidity of an investment in our
common stock.
 
 The
over-the-counter market for stock such as ours is subject to extreme price and
volume fluctuations.
 
 The
securities of companies such as ours have historically experienced extreme price
and volume fluctuations during certain periods. These broad market fluctuations
and other factors, such as new product developments and trends in the our
industry and in the investment markets generally, as well as economic conditions
and quarterly variations in our operational results, may have a negative effect
on the market price of our common stock.
 
 Buying
low-priced penny stocks is very risky and speculative.
 
 The
shares being offered are defined as a penny stock under the Securities and
Exchange Act of 1934, and rules of the Commission. The Exchange Act and such
penny stock rules generally impose additional sales practice and disclosure
requirements on broker-dealers who sell our securities to persons other than
certain accredited investors who are, generally, institutions with assets in
excess of $5,000,000 or individuals with net worth in excess of $1,000,000 or
annual income exceeding $200,000, or $300,000 jointly with spouse, or in
transactions not recommended by the broker-dealer. For transactions covered by
the penny stock rules, a broker-dealer must make a suitability determination for
each purchaser and receive the purchaser's written agreement prior to the sale.
In addition, the broker-dealer must make certain mandated disclosures in penny
stock transactions, including the actual sale or purchase price and actual bid
and offer quotations, the compensation to be received by the broker-dealer and
certain associated persons, and deliver certain disclosures required by the
Commission. Consequently, the penny stock rules may affect the ability of
broker-dealers to make a market in or trade our common stock and may also affect
your ability to resell any shares you may purchase in the public
markets.
 
 We
do not expect to pay dividends on common stock.
 
 We have
not paid any cash dividends with respect to our common stock, and it is unlikely
that we will pay any dividends on our common stock in the foreseeable future.
Earnings, if any, that we may realize will be retained in the business for
further development and expansion.
  ITEM 2. UNREGISTERED SALES OF EQUITY
SECURITIES AND USE OF PROCEEDS.
 
 None
 
 ITEM
3.  DEFAULTS UPON SENIOR SECURITIES
 
 None
 
 
 ITEM
4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
 
 None
 
 -
16 -
 
 ITEM
5.  OTHER INFORMATION
 
 None
 
 
 ITEM
6.  EXHIBITS
 
 Exhibits
 
 Exhibit
      Number
                Description3.1*
                Articles
      of Incorporation3.2*
                Bylaws21
      *
                List
      of Subsidiaries.31.1
                Certification
      of Chief Executive and Chief Financial Officer pursuant to Rule
      13a-14(a)/15(d)-14(a)32.1
                Certification
      of Chief Executive and Chief Financial Officer pursuant to 18 U.S.C.
      Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act
      of 2002
 
 *
Previously filed under cover of Form SB-2 on November 1, 2007.
 
 Reports on Form
8-K
 
 We had no
filings under cover of Form 8K for the fiscal quarter ended March 31,
2009.
 
  
 -
17 -
 
 
 
  SIGNATURES
 
 Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned thereunto
duly authorized on May 18, 2009.
  GREAT
      SPIRITS, INC.By:
              /s/
      Dana HydeDana
      Hyde,Chief
      Executive Officer and President
                (principal
      executive officer)
                Chief
      Financial Officer
                (principal
      financial and accounting officer)
  - 18
-