UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


Washington,
D.C.  20429





FORM
10-K





x
            ANNUAL
      REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934





For the
fiscal year ended December 31, 2008.





Commission
file number: 333-142516





Southern Bella,
Inc.




(Exact
name of registrant as specified in its charter)





Delaware
              
              20-8602410(State
      or other jurisdiction of
              
              (I.R.S.
      employer identification no.)incorporation
      or organization)





1006
      Delaware AvenueLexington,
      Kentucky
                
                40505-0464(Address
      of principal executive offices)
                
                (Zip
      Code)





Registrant’s
telephone number, including area code:    (859)
231-0464





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





Title
      of Each Class
                Name
      of Exchange on Which RegisteredCommon stock, par value $0.000001 per
      share
                None





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




Indicate
by check mark if the registrant is a well-known seasoned issuer as defined in
Rule 405 of the Securities Act.  ̈ Yes
þ  No




Indicate
by check mark if the registrant is not required to file reports pursuant to
Section 13 or 15(d) of the Act.  ̈ Yes
þ No




Indicate
by check mark whether the registrant (1) has filed all reports required to be
filed by section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days. þ Yes  ̈
 No




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





Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting
company.  See the definitions of “large accelerated filer,”
“accelerated filer” and “smaller reporting company” in Rule 12b-2 of the
Exchange Act.




Large
      Accelerated filer  ̈
                Accelerated
      filer  ̈Non-accelerated
      filer  ̈
                Smaller
      reporting company þ(Do
      not check if smaller reporting company)




Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Act).  ̈  Yes
þ
 No




The
aggregate market value of the voting stock held by non-affiliates as of March
24, 2009, was approximately $50,000.  The value is based on the sales
price of the registered common stock sold in 2007.  There have been no
sales of the common stock since the initial purchase by the non-affiliates in
the registered offering.  For purposes of this computation only, all
executive officers, directors, and beneficial owners of more than 10% of the
outstanding Common Stock, are assumed to be affiliates.




The
number of shares outstanding of the issuer's Common Stock on March 24, 2009, was
8,666,667.




DOCUMENTS
INCORPORATED BY REFERENCE




None







SOUTHERN
BELLA, INC.


FORM
10-K


TABLE
OF CONTENTS




Page
      No.PART
      IItem
      1.
                          Description
      of Business
                          
                          
                          1Item
      1A.
                          Risk
      Factors
                          
                          
                          2Item
      1B.
                          Unresolved
      Staff Comments
                          
                          
                          2Item
      2.
                          Properties
                          
                          
                          2Item
      3.
                          Legal
      Proceedings
                          
                          
                          2Item
      4.
                          Submission
      of Matters to a Vote of Security Holders
                          
                          
                          2PART
      IIItem
      5.
                          Market
      for Registrant’s Common Equity, Related Stockholder
Mattersand
      Issuer Purchases of Equity Securities
                          
                          
                          3Item
      6.
                          Selected
      Financial Data
                          
                          
                          4Item
      7.
                          Management’s
      Discussion and Analysis of Financial Condition andResults
      of Operation
                          
                          
                          4Item
      7A.
                          Quantitative
      and Qualitative Disclosures About Market Risk
                          
                          
                          6Item
      8.
                          Financial
      Statements and Supplementary Data
                          
                          
                          7Item
      9.
                          Changes
      in and Disagreements With Accountants onAccounting
      and Financial Disclosure
                          
                          
                          22Item
      9A.
                          Controls
      and Procedures
                          
                          
                          22Item
      9B.
                          Other
      Information
                          
                          
                          23PART
      IIIItem
      10.
                          Directors,
      Executive Officers and Corporate Governance
                          
                          
                          24Item
      11.
                          Executive
      Compensation
                          
                          
                          25Item
      12.
                          Security
      Ownership of Certain Beneficial Owners and Management andRelated
      Stockholder Matters.
                          
                          
                          26Item
      13.
                          Certain
      Relationships and Related Transactions and Director
      Independence
                          
                          
                          27Item
      14.
                          Principal
      Accounting Fees and Services.
                          
                          
                          27Item
      15.
                          Exhibits,
      Financial Statement Schedules
                          
                          
                          28Signatures
                          
                          
                          29


i





PART
I





ITEM
1.              DESCRIPTION
OF BUSINESS





Overview





Southern
Bella, Inc. was incorporated in Delaware on February 22,
2007.  Southern Bella, Inc. was organized to acquire catering
companies throughout the United States.  The first catering company
acquired by Southern Bella, Inc. was Dupree Catering, Inc.
(“Dupree”).  Dupree is a Kentucky corporation, formed on October 28,
1991.  On March 1, 2007, Southern Bella, Inc. acquired all of the
shares of stock of Dupree for $110,000 and Dupree became the wholly-owned
subsidiary of Southern Bella, Inc.  Southern Bella, Inc. sold all of
the assets of Dupree on July 1, 2008.





Southern
Bella Inc.’s address is 1006 Delaware Avenue, Lexington, Kentucky 40505-0464,
and its telephone number is 859.231.0464.




Business





Through
Dupree, a Kentucky corporation, our wholly-owned subsidiary, we engaged in the
catering business until July 1, 2008, when we sold the assets of Dupree to
Harriet Dupree Bradley. Southern Bella seeks to acquire other catering
businesses throughout the United States. Southern Bella currently does not have
any agreements and is not currently in negotiations with any other catering
businesses to acquire such businesses.




Markets We
Serve




Dupree
primarily provided catering services in Central Kentucky. Dupree’s target market
consisted of companies of all sizes and high net worth individuals in the
Central Kentucky Market. Southern Bella seeks to acquire other catering
businesses throughout the United States to expand its market outside Central
Kentucky.





Business
Challenges




Because
Southern Bella sold the assets of Dupree, it will not be able to operate the
catering business until it acquires another existing and operational catering
business.




Management
of Southern Bella is looking for merger candidates to maximize shareholder
value. Management has not identified any targets or merger candidates at this
time.




Employees




We
currently have no employees.  We have two members of management, Viola
J. Heitz and Terry Riggleman.





Patents and
Trademarks





We do not
own, either legally or beneficially any patent or trademarks.





Government Supervision and
Regulation





The
services Dupree provided are subject to various federal, state and local laws
and regulations including regulations relating to the storage, handling and
preparation of food and to the supplying of alcoholic beverages.  We
believe Dupree was in substantial compliance with applicable laws, regulations
and guidelines.


1




ITEM
1A.           RISK
FACTORS





Not Applicable.





ITEM
1B.           UNRESOLVED
STAFF COMMENTS





None.





ITEM
2.              PROPERTIES





Southern
Bella, Inc. was leasing office space consisting of approximately 3,000 square
feet located at 1006 Delaware Avenue, Lexington, Kentucky 40505 (the “Premises”)
from Harriet Dupree Bradley pursuant to a Lease Agreement dated March 1,
2007.  The lease was terminated in July, 2008, when the assets of
Dupree were sold to Harriet Dupree Bradley.




Southern
Bella, Inc. does not plan on leasing any additional space until it has acquired
another catering company.




ITEM
3.              LEGAL
PROCEEDINGS





None





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





None




2


PART
II





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





Common
Stock





We are
authorized to issue 1,000,000,000 shares of common stock with $0.000001 par
value. As of March 24, 2009, there were 8,666,667 shares of common stock issued
and outstanding held by 43 shareholders of record.





Market
Information





We are
not registered on any public stock exchange.  There is no established
public trading market for our securities and a regular trading market may not
develop, or if developed, may not be sustained.  We have no plans,
proposals, arrangements, or understandings with any person with regard to the
development of a trading market in any of our securities.  There is no
guarantee that our securities will ever trade on the OTC Bulletin Board or other
exchange.





OTC Bulletin Board
Qualification for Quotation





To have
our shares of common stock on the OTC Bulletin Board, a market maker must file
an application on our behalf in order to make a market for our common
stock.  We have filed an application but have not received a symbol as
of March 24, 2009.





Dividends





Holders
of common stock are entitled to receive ratably such dividends, if any, as may
be declared by the Board of Directors out of the surplus of Southern Bella,
Inc.  We have not paid any dividends since our inception, and we
presently anticipate that all earnings, if any, will be retained for development
of our business.  There are no restrictions in our Articles of
Incorporation or Bylaws that prevent us from declaring dividends.  Any
future disposition of dividends will be at the discretion of our Board of
Directors and will depend upon, among other things, our future earnings,
operating and financial condition, capital requirements, and other
factors.





Preferred
Stock





The
Company is authorized to issue 20,000,000 shares of preferred stock with a par
value of $0.000001 per share. As of the date of this Annual Report, there are no
preferred shares outstanding.





Preferred
stock may be issued in series with preferences and designations as the Board of
Directors may from time to time determine.  The board may, without
shareholders approval, issue preferred stock with voting, dividend, liquidation
and conversion rights that could dilute the voting strength of our common
shareholders and may assist management in impeding an unfriendly takeover or
attempted changes in control.





Securities Authorized for
Issuance under Equity Compensation Plans





We do not
have any compensation plans or arrangement under which equity securities are
authorized for issuance.


3





Purchases of Equity
Securities





No
purchases of our own equity securities, either as a part of a publicly announced
plan or otherwise, were made during any month in 2008.





ITEM
6. SELECTED FINANCIAL DATA





Not applicable





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





SPECIAL
INFORMATION REGARDING FORWARD LOOKING STATEMENTS





Some of
the statements in this Form 10-K are “forward-looking
statements.”  These forward-looking statements involve certain known
and unknown risks, uncertainties and other factors which may cause our actual
results, performance or achievements to be materially different from any future
results, performance or achievements expressed or implied by these
forward-looking statements.  The words “believe,” “expect,”
“anticipate,” “intend,” “plan,” and similar expressions identify forward-looking
statements.  We caution you not to place undue reliance on these
forward-looking statements.  We undertake no obligation to update and
revise any forward-looking statements or to publicly announce the result of any
revisions to any of the forward-looking statements in this document to reflect
any future or developments.





The
following discussion should be read in conjunction with our financial statements
and the notes thereto which appear elsewhere in this report. The results shown
herein are not necessarily indicative of the results to be expected in any
future periods.  This discussion contains forward-looking statements
based on current expectations, which involve uncertainties.  Actual
results and the timing of events could differ materially from the
forward-looking statements as a result of a number of factors.





Overview





On July
1, 2008, the Company entered into a Bill of Sale with Harriet Dupree Bradley for
the acquisition of the assets of Dupree.  The transaction was for the
assets of Dupree having a cost of $13,407 and accumulated depreciation of
$5,805, which left a net book value of $7,602.  In addition, Southern
Bella’s line of credit of $27,000 and its accrued interest of $461 was forgiven,
a shareholder loan to Bradley of $10,000 along with accrued interest of $1,239
was forgiven, and other payables of $127 were forgiven, for a total benefit
received by Southern Bella of $38,827.  Southern Bella had transferred
$1,600 of cash to Dupree, which was also forgiven.  The result is a
net gain on the sale of assets from the Company to Bradley of
$29,625.  This gain was recorded as an increase in paid in capital as
Ms. Bradley is a related party.





The
consulting agreement with Harriet Dupree Bradley terminated as of December 31,
2008.





During
the downturn in the economy, there were many corporate and personal
cutbacks.  The catering industry has experienced fewer events booked
and has seen events that had been previously booked, cancelled.  As
the economy continues to suffer, both corporate and personal events, such as
weddings, will be scaled down.  One of the industries to undergo the
changes in the market is the catering business.





Plan of
Operation




The
Company is seeking to acquire operational catering companies.


4




Presentation of Predecessor
and Successor Financial Statement Information




Southern
Bella was formed on February 22, 2007, to acquire Dupree Catering,
Inc.  Since Southern Bella had no prior operations but succeeded to
the business of Dupree, Dupree is considered the “predecessor” entity and
Southern Bella as the “successor” entity.  As a result of this
treatment, the consolidated statements of operations shows the successor
information from February 22, 2007, through December 31, 2007.  The
consolidated statements of operations also shows the successor financial
information from January 1, 2008, through December 31, 2008.





Analysis of Financial
Condition and Results of Operation




Southern
Bella was formed on February 22, 2007. On March 1, 2007, Southern Bella acquired
Dupree Catering, Inc. (“Dupree”).  Southern Bella has had no
operations other than through its wholly-owned subsidiary, Dupree, since the
acquisition of Dupree.





On July
1, 2008, the Company entered into a Bill of Sale with Harriet Dupree Bradley for
the acquisition of the assets of Dupree.  The transaction was for the
assets of Dupree having a cost of $13,407 and accumulated depreciation of
$5,805, which left a net book value of $7,602.  In addition, Southern
Bella’s the line of credit of $27,000 and its accrued interest of $461 was
forgiven, a shareholder loan to Bradley of $10,000 along with accrued interest
of $1,239 was forgiven, and other payables of $127 were forgiven, for a total
benefit received by Southern Bella of $38,827.  Southern Bella had
transferred $1,600 of cash to Dupree, which was also forgiven.  The
result is a net gain on the sale of assets from the Company to Bradley of
$29,625.  This gain was recorded as an increase in paid in capital, as
Ms. Bradley is a related party.  The financial statements show Dupree
as discontinued operations.





Comparison of 2008 to
2007





Set forth
below is an analysis of the financial condition and results of operation of
Southern Bella for the year ended December 31, 2008 compared to the year ended
December 31, 2007.




December
                    31, 2008
                  
                  
                  December
                    31, 2007Catering
      revenue
                  
                  $
                  0
                  
                  
                  $
                  0Total
      revenue
                  
                  $
                  0
                  
                  
                  $
                  0





Southern
Bella’s revenues for year ended December 31, 2008 were unchanged since both
years revenues were 0.  This is because the net income (loss) from
Dupree is being shown as discontinued operations. We hope to have catering
revenue in the future.





December
                    31, 2008
                  
                  
                  December
                    31, 2007Operating
      expenses before depreciation
                  
                  $
                  21,070
                  
                  
                  $
                  62,062




For year
ended December 31, 2008, Southern Bella’s operating expenses were 66.05% lower
than expenses for year ended December 31, 2007. This is due to a decrease of
66.94% in professional fees from $62,000 in 2007, to $20,500 in 2008, due to the
cost of going public.  The Company is now maintaining auditing and
legal work, rather than beginning the process of “going public”.  We
believe the professional fees will remain at a constant level in the
future.


5





Accordingly,
Southern Bella had the following total operating expenses and net operating
income (loss) before other income (expense):





December
                      31, 2008
                    
                    December
                      31, 2007Total
      expenses
                    
                    $
                    21,070
                    
                    
                    $
                    62,062Net
      operating income (loss)
                    
                    $
                    (21,070
                    )
                    
                    $
                    (62,062
                    )





There was
an $21,070 operating loss for year ended December 31, 2008, and a $62,062
operating loss for year ended December 31, 2007.




December
                    31, 2008
                  
                  
                  December
                    31, 2007Net
      loss from Dupree discontinued operations
                  
                  $
                  (22,767
                  )
                  
                  $
                  (40,887
                  )Impairment
      of intangible asset related to Dupree business unit
                  
                  
                  (50,180
                  )
                  
                  
                  -





The net
loss from Dupree discontinued operations decreased by 44.32% from a $40,887 net
loss to a $22,767 net loss for the years ended December 31, 2008 and December
31, 2007, respectively.  There was an impairment of the customer list
of Dupree of $50,180.  These are due to Harriet Dupree Bradley
acquiring the assets of Dupree on July 1, 2008.





Liquidity and Capital
Resources




We do not
have any material commitments for capital during 2009.  Due to the
uncertainties involved, our auditors have included a going concern paragraph in
their opinion on our audited financial statements.




Off-Balance Sheet
Arrangements




There are
no off-balance sheet arrangements.




ITEM
7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK




Not
Applicable.




6




ITEM
8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA


SOUTHERN
BELLA, INC.




(DEVELOPMENT
STAGE COMPANY)




INDEX
TO CONSOLIDATED FINANCIAL STATEMENTS




Page(s)Financial
      Statements:Report
      of Independent Registered Public Accounting Firm
                
                
                8Consolidated
      Balance Sheets as of December 31, 2008 and  December 31, 2007 –
      Successor
                
                
                9Consolidated
      Statements of Operations for the years ended December 31, 2008 and
      December 31, 2007
                
                
                10Consolidated
      Statements of Changes in Stockholders’ Equity for the  period
      February 22, 2007 (Inception) through December 31, 2008
                
                
                11Consolidated
      Statements of Cash Flows for the period January 1, 2008 through December
      31, 2008, and January 1, 2007 through December 31, 2007
                
                
                12Notes
      to Consolidated Financial Statements
                
                
                13


7


Report
of Independent Registered Public Accounting Firm




To
the Board of Directors




Southern
Bella, Inc.


We have
audited the accompanying balance sheets of Southern Bella, Inc. (a development
stage company) as of December 31, 2008 and 2007 and the related statements of
operations, changes in stockholders' deficit, and cash flows for the periods
then ended and the period from February 22, 2007 (inception) through December
31, 2008.   These financial statements are the responsibility of
the Company's management. Our responsibility is to express an opinion on these
financial statements based on our audit.




We
conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. The Company is not required to
have, nor were we engaged to perform, an audit of its internal control over
financial reporting. Our audit included consideration of internal control over
financial reporting as a basis for designing audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Company's internal control over financial
reporting. Accordingly, we express no such opinion. An audit also includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.




In our
opinion, the financial statements referred to above present fairly, in all
material respects, the financial position of Southern Bella, Inc. as of December
31, 2008 and 2007, and the results of its operations, changes in stockholders'
deficit and cash flows for the period described above in conformity with
accounting principles generally accepted in the United States of
America.




The
accompanying financial statements have been prepared assuming that the Company
will continue as a going concern. As discussed in Note 3 to the financial
statements, the Company suffered a net loss from continuing operations and has a
net capital deficiency, which raises substantial doubt about its ability to
continue as a going concern. Management's plans regarding those matters also are
described in Note 3. The financial statements do not include any adjustments
that might result from the outcome of this uncertainty.




/s/
      M&K CPAS, PLLCHouston,
      Texaswww.mkacpas.comApril
      13, 2009




8




SOUTHERN
BELLA, INC.


CONSOLIDATED
BALANCE SHEETS


DECEMBER
31, 2008 AND DECEMBER 31, 2007


(Development
Stage Company)





December
      31,
                      
                      
                      December
      31,2008
                      
                      
                      2007ASSETSCURRENT
      ASSETSCash
                      
                      $
                      8,148
                      
                      
                      $
                      20,325Prepaid
      expense
                      
                      
                      -
                      
                      
                      
                      1,314Total
      current assets
                      
                      
                      8,148
                      
                      
                      
                      21,639Net
      assets related to discontinued operations
                      
                      
                      -
                      
                      
                      
                      159,788TOTAL
      ASSETS
                      
                      $
                      8,148
                      
                      
                      $
                      181,427LIABILITIES
      AND STOCKHOLDERS' EQUITYCURRENT
      LIABILITIESNet
      liabilities related to discontinued operations
                      
                      $
                      -
                      
                      
                      $
                      108,887Total
      current liabilities
                      
                      
                      -
                      
                      
                      
                      108,887STOCKHOLDERS'
      EQUITYPreferred
      stock, $0.000001 par value, 20,000,000 shares authorized, none issued and
      outstanding
                      
                      
                      -
                      
                      
                      
                      -Common
      stock, $0.000001 par value, 1,000,000,000 shares authorized, 8,666,667
      shares issued and outstanding at December 31, 2008 and December 31, 2007,
      respectively
                      
                      
                      9
                      
                      
                      
                      9Additional
      paid in capital
                      
                      
                      209,616
                      
                      
                      
                      179,991Accumulated
      deficit prior to re-entering development stage
                      
                      
                      (180,407
                      )
                      
                      
                      (107,460
                      )Accumulated
      deficit during development stage
                      
                      
                      (21,070
                      )
                      
                      
                      -Total
      stockholders' equity
                      
                      
                      8,148
                      
                      
                      
                      72,540TOTAL
      LIABILITIES AND STOCKHOLDERS' EQUITY
                      
                      $
                      8,148
                      
                      
                      $
                      181,427




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


9


CONSOLIDATED
STATEMENTS OF OPERATIONS


FOR
THE YEARS ENDED DECEMBER 31, 2008


AND
DECEMBER 31, 2007


(Development
Stage Company)





JANUARY
      1, 2008
                                                        THROUGH
                                                        DECEMBER
      31, 2008
                                                      
                                                      
                                                      FEBRUARY
      22, 2007
                                                        THROUGH
                                                        DECEMBER
      31, 2007REVENUE
                                                      
                                                      $
                                                      -
                                                      
                                                      
                                                      $
                                                      -COST
      OF REVENUESSalaries
      and wage related expenses
                                                      
                                                      
                                                      -
                                                      
                                                      
                                                      
                                                      -Food
      and beverages
                                                      
                                                      
                                                      -
                                                      
                                                      
                                                      
                                                      -Other
      costs of revenues
                                                      
                                                      
                                                      -
                                                      
                                                      
                                                      
                                                      -Total
      costs of revenues
                                                      
                                                      
                                                      -
                                                      
                                                      
                                                      
                                                      -OPERATING
      EXPENSESAdvertising
      expenses
                                                      
                                                      
                                                      -
                                                      
                                                      
                                                      
                                                      -Professional
      fees
                                                      
                                                      
                                                      20,500
                                                      
                                                      
                                                      
                                                      62,000Rent
      and utilities
                                                      
                                                      
                                                      -
                                                      
                                                      
                                                      
                                                      -General
      and administrative
                                                      
                                                      
                                                      570
                                                      
                                                      
                                                      
                                                      62Total
      operating expenses
                                                      
                                                      
                                                      21,070
                                                      
                                                      
                                                      
                                                      62,062NET
      LOSS FROM CONTINUING OPERATIONS
                                                      
                                                      
                                                      (21,070
                                                      )
                                                      
                                                      
                                                      (62,062
                                                      )Net
      income from Dupree discontinued operations
                                                      
                                                      
                                                      (22,767
                                                      )
                                                      
                                                      
                                                      (40,887
                                                      )Impairment
      of intangible asset related to Dupree business unit
                                                      
                                                      
                                                      (50,180
                                                      )
                                                      
                                                      
                                                      -NET
      INCOME (LOSS) FROM DISCONTINUED OPERATIONS
                                                      
                                                      
                                                      (72,947
                                                      )
                                                      
                                                      
                                                      (40,887
                                                      )NET
      INCOME (LOSS)
                                                      
                                                      $
                                                      (94,017
                                                      )
                                                      
                                                      $
                                                      (102,949
                                                      )BASIC
      AND DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS
                                                      
                                                      $
                                                      (0.00
                                                      )
                                                      
                                                      $
                                                      (0.01
                                                      )BASIC
      AND DILUTED EARNINGS PER SHARE FROM DISCONTINUED
OPERATIONS
                                                      
                                                      $
                                                      (0.01
                                                      )
                                                      
                                                      $
                                                      (0.01
                                                      )WEIGHTED
      AVERAGE NUMBER OFSHARES
      OUTSTANDING
                                                      
                                                      
                                                      8,666,667
                                                      
                                                      
                                                      
                                                      7,745,921




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


10




SOUTHERN
BELLA, INC.


CONSOLIDATED
STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY – SUCCESSOR


FOR
THE PERIOD FEBRUARY 22, 2007 (INCEPTION) THROUGH DECEMBER 31, 2008


(Development
Stage Company)





Preferred
      Stock
                                                                    
                                                                    
                                                                    Common
      Stock
                                                                    
                                                                    
                                                                    
                                                                    
                                                                    
                                                                    
                                                                    
                                                                    
                                                                    Accumulated
                                                                      DeficitShares
                                                                    
                                                                    
                                                                    Amount
                                                                    
                                                                    
                                                                    Shares
                                                                    
                                                                    
                                                                    Amount
                                                                    
                                                                    
                                                                    Additional
                                                                      Paid-In
                                                                      Capital
                                                                    
                                                                    
                                                                    Accumulated
                                                                      Deficit
                                                                    
                                                                    
                                                                    During
                                                                      Development
                                                                      Stage
                                                                    
                                                                    
                                                                    TotalBalance
      – February 22, 2007 (inception)
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    $
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    $
                                                                    -
                                                                    
                                                                    
                                                                    $
                                                                    -
                                                                    
                                                                    
                                                                    $
                                                                    -
                                                                    
                                                                    
                                                                    $
                                                                    -
                                                                    
                                                                    
                                                                    $
                                                                    -Common
      shares issued to founder for cash
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    8,166,667
                                                                    
                                                                    
                                                                    
                                                                    8
                                                                    
                                                                    
                                                                    
                                                                    122,492
                                                                    
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    122,500Common
      shares issued for cash
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    500,000
                                                                    
                                                                    
                                                                    
                                                                    1
                                                                    
                                                                    
                                                                    
                                                                    57,499
                                                                    
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    57,600Net
      loss for the period
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    (107,460
                                                                    )
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    (107,460
                                                                    )Balance
      – December 31, 2007
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    $
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    8,666,667
                                                                    
                                                                    
                                                                    $
                                                                    9
                                                                    
                                                                    
                                                                    $
                                                                    179,991
                                                                    
                                                                    
                                                                    $
                                                                    (107,460
                                                                    )
                                                                    
                                                                    $
                                                                    -
                                                                    
                                                                    
                                                                    $
                                                                    72,540Gain
      from sale of discontinued operations to related party
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    $
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    $
                                                                    -
                                                                    
                                                                    
                                                                    $
                                                                    29,625
                                                                    
                                                                    
                                                                    $
                                                                    -
                                                                    
                                                                    
                                                                    $
                                                                    -
                                                                    
                                                                    
                                                                    $
                                                                    29,625Net
      loss from continuing operations
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    (21,070
                                                                    )
                                                                    
                                                                    $
                                                                    (21,070
                                                                    )Net
      loss from discontinued operations
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    (72,947
                                                                    )
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    (72,947
                                                                    )Balance
      – December 31, 2008
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    $
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    8,666,667
                                                                    
                                                                    
                                                                    $
                                                                    9
                                                                    
                                                                    
                                                                    $
                                                                    209,616
                                                                    
                                                                    
                                                                    $
                                                                    (180,407
                                                                    )
                                                                    
                                                                    $
                                                                    (21,070
                                                                    )
                                                                    
                                                                    $
                                                                    8,148


11




SOUTHERN
BELLA, INC.


CONSOLIDATED
STATEMENT OF CASH FLOW


FOR
THE PERIOD JANUARY 1, 2008 THROUGH DECEMBER 31, 2008 AND


JANUARY
1, 2007 THROUGH DECEMBER 31, 2007


(Development
Stage Company)





JANUARY 1, 2008
                                                                          THROUGH
                                                                          DECEMBER 31,
                                                                          2008
                                                                        
                                                                        
                                                                        FEBRUARY 22,
                                                                          2007
                                                                          (INCEPTION)
                                                                          THROUGH
                                                                          DECEMBER 31,
                                                                          2007CASH
      FLOWS FROM OPERATING ACTIVITIES:Net
      income (loss)
                                                                        
                                                                        $
                                                                        (21,070
                                                                        )
                                                                        
                                                                        $
                                                                        (43,062
                                                                        )Change
      in assets and liabilities(Increase)
      / Decrease in prepaid expenses
                                                                        
                                                                        
                                                                        1,314
                                                                        
                                                                        
                                                                        
                                                                        (1,314
                                                                        )Net
      cash used in operating activities
                                                                        
                                                                        
                                                                        (19,756
                                                                        )
                                                                        
                                                                        
                                                                        (44,376
                                                                        )CASH
      FLOWS FROM FINANCING ACTIVITIES:Issuance
      of stock for cash
                                                                        
                                                                        
                                                                        -
                                                                        
                                                                        
                                                                        
                                                                        180,000Net
      cash provided by financing activities
                                                                        
                                                                        
                                                                        -
                                                                        
                                                                        
                                                                        
                                                                        180,000NET
      CASH PROVIDED BY DISCONTINUED OPERATIONS
                                                                        
                                                                        
                                                                        7,579
                                                                        
                                                                        
                                                                        
                                                                        (106,336
                                                                        )NET
      INCREASE IN CASH AND CASH EQUIVALENTS
                                                                        
                                                                        
                                                                        (12,177
                                                                        )
                                                                        
                                                                        
                                                                        29,288CASH
      AND CASH EQUIVALENTS - BEGINNING OF PERIOD
                                                                        
                                                                        $
                                                                        20,325
                                                                        
                                                                        
                                                                        
                                                                        -CASH
      AND CASH EQUIVALENTS – END OF PERIOD
                                                                        
                                                                        $
                                                                        8,148
                                                                        
                                                                        
                                                                        $
                                                                        45,350NON-CASH
      ACTIVITIESGain
      on non-cash sale of assets to related party
                                                                        
                                                                        $
                                                                        29,626
                                                                        
                                                                        
                                                                        $
                                                                        29,626SUPPLEMENTAL
      NONCASH INVESTING AND FINANCING ACTIVITIESAcquisition
      of Dupree Catering, Inc. (Eliminated in
      Presentation)Cash
      paid for acquisition
                                                                        
                                                                        
                                                                        -
                                                                        
                                                                        
                                                                        $
                                                                        110,000Customer
      lists acquired
                                                                        
                                                                        
                                                                        -
                                                                        
                                                                        
                                                                        
                                                                        (90,325
                                                                        )Accounts
      receivable acquired
                                                                        
                                                                        
                                                                        -
                                                                        
                                                                        
                                                                        
                                                                        (12,678
                                                                        )Fixed
      assets acquired
                                                                        
                                                                        
                                                                        -
                                                                        
                                                                        
                                                                        
                                                                        (5,628
                                                                        )Accounts
      payable assumed
                                                                        
                                                                        
                                                                        -
                                                                        
                                                                        
                                                                        
                                                                        22,350Net
      cash acquired
                                                                        
                                                                        
                                                                        -
                                                                        
                                                                        
                                                                        $
                                                                        23,719Cash
      paid for income taxes
                                                                        
                                                                        
                                                                        -
                                                                        
                                                                        
                                                                        
                                                                        -Cash
      paid for interest
                                                                        
                                                                        
                                                                        -
                                                                        
                                                                        
                                                                        
                                                                        -




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


12


SOUTHERN
BELLA, INC.


Notes to
Consolidated Financial Statements




NOTE
1 – BASIS OF PRESENTATION




On
February 22, 2007, Southern Bella, Inc. (the “Company”) was incorporated in the
State of Delaware.  On March 1, 2007 the Company executed a Share
Purchase Agreement whereby the Company acquired 100% of the outstanding shares
of Dupree Catering, Inc., (“Dupree”) a corporation incorporated in the State of
Kentucky on October 28, 1991 for a total purchase price of $110,000, $100,000
paid in cash at closing and the remaining $10,000 in the form of a promissory
note that bears no interest and was due on February 28, 2008.  The
promissory note was subsequently paid at closing on March 1, 2007.




Dupree
was formed to provide catering services to individuals, corporations and
foundations.  They provide catering services for corporate events and
parties, weddings, fundraising events for foundations and kosher style events
including bar and bat mitzvahs.




The
transaction was treated as an acquisition under the purchase method of
accounting.  The new management of the Company maintained control of
the operations of Dupree, and thus the transaction was treated as a purchase
under FASB 141.




On July
1, 2008, the Company entered into a Bill of Sale with Harriet Dupree Bradley for
the acquisition of these assets.  The transaction was for the assets
of Dupree with a cost of $13,407 and accumulated depreciation of $5,805, which
left a net book value of $7,602.  In addition, Southern Bella’s line
of credit of $27,000 and its accrued interest of $461 was forgiven, a
shareholder loan to Bradley of $10,000 along with accrued interest of $1,239 was
forgiven, and other payables of $127 were forgiven, for a total benefit received
by Southern Bella of $38,827.  Southern Bella had transferred $1,600
of cash to Dupree, which was also forgiven.  The result is a net gain
on the sale of assets from the Company to Bradley of $29,625.  This
gain was recorded as additional paid in capital because Ms. Bradley is a related
party.




As a
result of this transaction, we re-entered the development stage on July 1,
2008.




Reclassification




Certain
amounts in the Consolidated Statement of Operations and Consolidated Balance
Sheets for the period ended December 31, 2007 have been reclassified to conform
to the 2008 presentation.


13


NOTE
2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES




Use of
Estimates




The
preparation of financial statements, in conformity with accounting principles
generally accepted in the United States, requires management to make estimates
and assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from these
estimates.




Cash and Cash
Equivalents




The
Company considers all highly liquid investments and other short-term investments
with a maturity of three months or less, when purchased, to be cash
equivalents.  There were no cash equivalents at December 31, 2008 or
December 31, 2007.




Concentrations of Credit
Risk




Financial
instruments which potentially subject the Company to concentrations of credit
risk consist principally of cash and receivables.  The Company places
its cash with high credit quality financial institutions.  At times,
such amounts may exceed the FDIC limits; however, these deposits typically may
be redeemed upon demand and therefore bear minimal risk.  In
monitoring this credit risk, the Company periodically evaluates the stability of
the financial institutions.  Generally, no collateral or other
security is required to support receivables.  To reduce credit risk, a
customer’s credit history is evaluated before extension of credit.  In
addition, an allowance for doubtful receivables has been established as needed
based on facts surrounding the credit risk of specific customers, historical
trends and other information.




Allowance for Doubtful
Accounts




The
Company provides an allowance for doubtful accounts, which is based upon a
review of outstanding receivables as well as historical collection
information.  The Company receives approximately 99% of its sales
through credit card payments prior to shipment.  In determining the
amount of the allowance, management is required to make certain estimates and
assumptions.  Management has determined that as of December 31, 2008,
no allowance for doubtful accounts is required.




Fixed
Assets




Fixed
assets are stated at cost, less accumulated depreciation. Depreciation is
provided using the straight-line method over the estimated useful lives of the
related assets (five years for the computer equipment). Costs of maintenance and
repairs are charged to expense as incurred.




14


Impairment of Long-Lived
Assets




The
Company reviews the recoverability of its long-lived assets on a periodic basis
whenever events and changes in circumstances have occurred which may indicate a
possible impairment. The assessment for potential impairment is based primarily
on the Company’s ability to recover the carrying value of its long-lived assets
from expected future cash flows from its operations on an undiscounted basis. If
such assets are determined to be impaired, the impairment recognized is the
amount by which the carrying value of the assets exceeds the fair value of the
assets. Fixed assets to be disposed of by sale are carried at the lower of the
then current carrying value or fair value less estimated costs to
sell.




Revenue
Recognition




The
Company generates revenue from the sales of their products in accordance with
Staff Accounting Bulletin 101. The criteria for recognition are as
follows:




1)
            Persuasive
      evidence of an arrangement exists;




2)
            Delivery
      has occurred or services have been
rendered;




3)
            The
      seller’s price to the buyer is fixed or determinable,
  and




4)
            Collectability
      is reasonably assured.




In
accordance with the above criteria, the Company generally recognizes the revenue
upon completion of the event being catered.




The
Company does require a deposit on the jobs they cater prior to performing the
service. This is reflected as a current liability until the service is
performed, which at that time it is reclassified to revenue. The remainder of
the fee is billed upon completion of the event being catered. Collections
generally occur within 30 days of billing, by cash, check or credit
card.




For the
years ended December 31, 2008 and 2007, the Company and Dupree had one major
customer that represented approximately 15% and 12% of the Company’s sales,
respectively.




For the
years ended December 31, 2008 and 2007, the Company and Dupree had two major
vendors that represented approximately 22% and 50% of the Company’s food and
beverage purchases, respectively.




Basic and Diluted Net Loss
Per Share




The basic
net loss per common share is computed by dividing the net loss by the weighted
average number of common shares outstanding. Diluted net loss per common share
is computed by dividing the net loss adjusted on an "as if converted" basis, by
the weighted average number of common shares outstanding plus potential dilutive
securities.




15




For the
years ended December 31, 2008, and December 31, 2007, there were no potentially
dilutive securities outstanding.




Fair Value of Financial
Instruments




Carrying
amounts for cash and cash equivalents, accounts receivable, prepaid expenses,
accounts payable and accrued liabilities and related party payables approximate
fair value due to the short-term nature of these instruments and interest at
market rates.  However, these values may not be representative of
actual values that could have been realized as of the balance sheet dates or
that will be realized in the future.




Income
Taxes




The
Company recognizes deferred tax assets and liabilities based on differences
between the financial reporting and tax bases of assets and liabilities using
the enacted tax rates and laws that are expected to be in effect when the
differences are expected to be recovered.  The Company provides a
valuation allowance for deferred tax assets for which it does not consider
realization of such assets likely.




Effective
January 1, 1992, Dupree Catering, Inc. elected to be treated as an S
Corporation. As an S Corporation, the Company is generally not subject to
corporate income taxes and the income, deductions, credits and other tax
attributes generated by the Company flow to its stockholders.




Stock
Based Compensation




The
Company accounts for stock-based employee compensation arrangements using the
fair value method in accordance with the provisions of Statement of Financial
Accounting Standards No. 123(R) or SFAS No. 123(R), Share-Based Payments, and
Staff Accounting Bulletin No. 107, or SAB 107, Share-Based
Payments.  The company accounts for the stock options issued to
non-employees in accordance with the provisions of Statement of Financial
Accounting Standards No. 123, or SFAS No. 123, Accounting for Stock-Based
Compensation, and Emerging Issues Task Force No. 96-18, Accounting for Equity
Instruments with Variable Terms That Are Issued for Consideration other Than
Employee Services Under FASB Statement No. 123.  The fair value of
stock options and warrants granted to employees and non-employees is determined
using the Black-Scholes option pricing model.  The Company has adopted
SFAS 123(R) and applied it in the period presented.  Through December
31, 2008 no options to employees have been granted.




Development Stage
Company





The Company complies with Statement of
Financial AccountingStandard (“SFAS”)
No.7 for its characterization as a
Development Stage Company.  Among the disclosures required by SFAS 7 are
that the statement of operations, stockholders’ deficit and cash flow disclose
activity since the date of the Company’s inception.




16




Recently Issued Accounting
Pronouncements




The
Company does not expect the adoption of recently issued accounting
pronouncements to have a significant impact on its results of operations,
financial position or cash flow.




NOTE
3 – GOING CONCERN




The
accompanying financial statements have been prepared assuming that the Company
will continue as a going concern.  As shown in the accompanying
financial statements, the Company suffered a loss from continuing operations of
$21,070 for the period ending December 31, 2008, and has a total accumulated
deficit of $201,478 at December 31, 2008.  These conditions raise
substantial doubt as to the Company's ability to continue as a going
concern.  The financial statements do not include any adjustments that
might be necessary if the Company is unable to continue as a going concern.
Management intends to finance these deficits by selling its common
stock.




NOTE
4 – LINE OF CREDIT




Southern
Bella had a revolving line of credit that was secured by the personal guarantee
of certain stockholders.  The line of credit had a maximum borrowing
amount of $75,000, an interest rate of prime, (5.25% at June 30, 2008) and a
balance due of zero at December 31, 2008.  The line of credit was
transferred on July 1, 2008 when Southern Bella sold Dupree’s assets to Harriet
Bradley Dupree.




NOTE
5 – CUSTOMER LISTS




Statement
of Financial Accounting Standards (SFAS) 142 “Accounting for Intangible Assets”
provides that intangible assets are evaluated at least annually for
impairments.  During March 2008 management had reassessed the future
cash flow and concluded that the prior expectations do not appear to be
obtainable.  Due to the sale of Dupree’s assets on July 1, 2008,
Southern Bella’s customer lists hold no value. This updated analysis resulted in
management’s decision to impair intangible assets totally, as of December 31,
2008, resulting in impairment losses of $50,180 during the year ended December
31, 2008.




NOTE
6 - STOCKHOLDERS’ EQUITY




The
Company was incorporated with 1,000,000,000 shares of common stock at $0.000001
par value and 20,000,000 shares of preferred stock at $0.000001 par value. On
February 22, 2007, the Company issued 8,166,667 shares of common stock for
$122,500 to its founder.




The
Company has also issued an additional 500,000 shares of common stock at $.10 for
$50,000 as part of a private placement from March through April
2007.




The
Company issued no shares of common or preferred stock during
2008.  The Company has issued no options or warrants since
inception.




17




NOTE
7 – RELATED PARTY TRANSACTIONS




On July
1, 2008, the Company entered into a Bill of Sale with Harriet Dupree Bradley for
the acquisition of these assets.  The transaction was for the assets
of Dupree with a cost of $13,407 and accumulated depreciation of $5,805, which
left a net book value of $7,602.  In addition, Southern Bella’s line
of credit of $27,000 and its accrued interest of $461 was forgiven, a
shareholder loan to Bradley of $10,000 along with accrued interest of $1,239 was
forgiven, and other payables of $127 were forgiven, for a total benefit received
by Southern Bella of $38,827.  Southern Bella had transferred $1,600
of cash to Dupree, which was also forgiven.  The result is a net gain
on the sale of assets from the Company to Bradley of $29,625.  This
gain was recorded as an increase in paid in capital, as Ms. Bradley is a related
party.




NOTE
8 - PROVISION FOR INCOME TAXES




Deferred
income taxes are determined using the liability method for the temporary
differences between the financial reporting basis and income tax basis of the
Company’s assets and liabilities.  Deferred income taxes are measured
based on the tax rates expected to be in effect when the temporary differences
are included in the Company’s tax return.  Deferred tax assets and
liabilities are recognized based on anticipated future tax consequences
attributable to differences between financial statement carrying amounts of
assets and liabilities and their respective tax bases.




As of
December 31, 2008, there is no provision for income taxes, current or
deferred.




Deferred
      tax asset
                  
                  $
                  70,517Valuation
      allowance
                  
                  
                  (70,517
                  )$
                  -




At
December 31, 2008, the Company had net operating loss carryforward in the
approximate amount of $201,478, available to offset future taxable income
through 2028.  The Company established valuation allowances equal to
the full amount of the deferred tax assets due to the uncertainty of the
utilization of the operating losses in future periods.




Dupree
Catering was an S Corporation. All net earnings generated passed through to the
shareholders and taxed at their respective tax rates.




NOTE
9 – COMMITMENTS AND CONTINGENCIES




The Company has no commitments or
contingencies.




18




NOTE
10 – DISCONTINUED OPERATIONS




In an
effort to secure additional capital, Southern Bella began actively seeking a
purchaser for the assets of Dupree, a company owned 100% by Southern
Bella.  On July 1, 2008, the Company entered into a Bill of Sale
with Harriet Dupree Bradley for the acquisition of these assets.  The
transaction was for the assets of Dupree with a cost of $13,407 and accumulated
depreciation of $5,805, which left a net book value of $7,602.  In
addition, Southern Bella received the line of credit of $27,000 and its accrued
interest of $461 was forgiven, a shareholder loan to Bradley of $10,000 along
with accrued interest of $1,239 was forgiven, and other payables of $127 were
forgiven, for a total benefit received by Southern Bella of
$38,827.  Southern Bella had transferred $1,600 of cash to Dupree,
which was also forgiven.  The result is a net gain on the sale of
assets from the Company to Bradley of $29,625.  This gain was recorded
as an increase in paid in capital, as Ms. Bradley is a related
party.




The
following table shows the net assets and net liabilities related to the sale of
the assets of Dupree.




December 31, 2008
                                        
                                        
                                        December 31, 2007Net
      Assets Related to Discontinued Operations:Accounts
      receivable related to discontinued operations, net of allowance of $0
      and $0 at December 31, 2008, and December 31, 2007,
      respectively
                                        
                                        $
                                        -
                                        
                                        
                                        $
                                        87,819Fixed
      assets related to discontinued operations, net of accumulated depreciation
      of $0 and $4,173 at December 31, 2008, and December 31, 2007,
      respectively
                                        
                                        
                                        -
                                        
                                        
                                        
                                        6,734Customer
      lists related to discontinued operations, net of accumulated amortization
      of $90,325 and $25,090 at December 31, 2008, and December 31, 2007,
      respectively
                                        
                                        
                                        -
                                        
                                        
                                        
                                        65,235Total
      Net Assets Related to Discontinued Operations
                                        
                                        $
                                        -
                                        
                                        
                                        $
                                        159,788Net
      Liabilities Related to Discontinued Operations:Accounts
      payable and accrued expenses, related to discontinued
      operations
                                        
                                        
                                        -
                                        
                                        
                                        
                                        98,887Related
      party payables, related to discontinued operations
                                        
                                        
                                        -
                                        
                                        
                                        
                                        10,000Total
      Net Liabilities Related to Discontinued Operations
                                        
                                        $
                                        -
                                        
                                        
                                        $
                                        108,887


19


NOTE
11 – BUSINESS COMBINATION




Southern
Bella was formed on February 22, 2007.  On March 1, 2007, Southern
Bella acquired Dupree Catering, Inc. (Dupree”).  Southern Bella has
had no operations other than through its wholly-owned subsidiary, Dupree, since
the acquisition of Dupree.  See Note 8 for explanation of sale of
Dupree assets.




Set forth
below is an analysis of the unaudited proforma statement financial condition and
results of continuing operation of Southern Bella for the year ended December
31, 2008 compared to the same period ended December 31, 2007 as if the
acquisition had taken place on January 1, 2007 and January 1, 2008,
respectively.




(Unaudited)
      Pro Forma
                                      Year
      EndedDecember 31, 2008
                                    
                                    
                                    December 31, 2007Sales
                                    
                                    $
                                    -
                                    
                                    
                                    $
                                    -Cost
      of Sales
                                    
                                    
                                    -
                                    
                                    
                                    
                                    -Gross
      Margin
                                    
                                    
                                    -
                                    
                                    
                                    
                                    -Operating
      Expenses
                                    
                                    
                                    21,070
                                    
                                    
                                    
                                    62,062Other
      Expenses
                                    
                                    
                                    -
                                    
                                    
                                    
                                    -Net
      Loss from Continuing Operation
                                    
                                    $
                                    (21,070
                                    )
                                    
                                    $
                                    (62,062
                                    )


20


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





None.





ITEM
9A.           CONTROLSAND
PROCEDURES





We
carried out an evaluation under the supervision and with the participation of
our management, including the Chief Executive Officer ("CEO") and Chief
Financial Officer ("CFO"), of the effectiveness of our disclosure controls and
procedures as of December 31, 2008.  Based on that evaluation, the CEO
and CFO have concluded that our disclosure controls and procedures are not
effective to provide reasonable assurance that:  (i) information
required to be disclosed by us in reports that we file or submit under the
Securities Exchange Act of 1934 is accumulated and communicated to our
management, including the CEO and CFO, as appropriate to allow timely decisions
regarding required disclosure by us; and (ii) information required to be
disclosed by us in reports that it files or submits under the Securities
Exchange Act of 1934 is recorded, processed, summarized and reported within the
time periods specified in Securities and Exchange Commission rules and
forms.




Management's Report on
Internal Control Over Financial Reporting




Our
management is responsible for establishing and maintaining adequate internal
control over financial reporting, as such term is defined in Rules 13a-15(f) and
15d-15(f) of the Exchange Act. Our internal control system was designed to
provide reasonable assurance regarding the reliability of financial reporting
and the preparation of financial statements for external purposes, in accordance
with generally accepted accounting principles. Because of inherent limitations,
a system of internal control over financial reporting may not prevent or detect
misstatements. Also, projections of any evaluation of effectiveness to future
periods are subject to the risk that controls may become inadequate due to
change in conditions, or that the degree of compliance with the policies or
procedures may deteriorate.




Our
management conducted an evaluation of the effectiveness of our internal control
over financial reporting using the criteria set forth by the Committee of
Sponsoring Organizations of the Treadway Commission (COSO) in Internal
Control—Integrated Framework. Based on its evaluation, our management concluded
that there is a material weakness in our internal control over financial
reporting. A material weakness is a deficiency, or a combination of control
deficiencies, in internal control over financial reporting such that there is a
reasonable possibility that a material misstatement of the Company’s annual or
interim financial statements will not be prevented or detected on a timely
basis.




The
material weakness relates to the lack of sufficient accounting staff and the
performance of the principal accounting functions by one officer. Our chief
executive officer also serves as our chief financial officer. All of our
financial reporting is carried out by one individual, and we do not have an
audit committee. Our board of directors consists of one individual, who serves
as our chief executive officer and chief financial officer. This lack of
accounting staff results in a lack of segregation of duties and accounting
technical expertise necessary for an effective system of internal
control.




21




In order
to remedy our existing internal control deficiencies, as soon as our finances
allow, we will hire a Chief Financial Officer who will be sufficiently versed in
public company accounting to implement appropriate procedures for timely and
accurate disclosures. We will also establish an audit committee and recruit
members to serve on our board of directors.




Management’s
report was not subject to attestation by Southern Bella’s registered public
accounting firm pursuant to temporary rules of the SEC that permit Southern
Bella, Inc. to provide only management’s report in this annual
report.




Changes
in Internal Control Over Financial Reporting




There
were no changes in our internal control over financial reporting during the
fourth quarter of fiscal 2008 that have materially affected, or are reasonably
likely to materially affect, our internal control over financial
reporting.





ITEM
9B.           OTHER
INFORMATION





None.


22


PART
III
 
 ITEM 10.
                DIRECTORS,
      EXECUTIVE OFFICERS AND CORPORATE
GOVERNANCE
 
 Directors and Executive
Officers
 
 Our
directors and executive officers are as follows:
 
 Ms. Viola
J. Heitz, age 56, has been our Chief Executive Officer and Director since March
1, 2007.  Ms. Heitz earned a Bachelor of Science degree from West
Virginia University and an Master of Arts degree from Eastern Kentucky
University. She taught high school English in public and private schools for 18
years.  In 2000, she left her career in education to focus on
traveling, volunteering on the local and international level, and working on a
free-lance basis.  From November 1, 2002, through December 1, 2004,
Ms. Heitz was the president of Mega Machinery Movers, the only minority-owned
industrial moving company in Kentucky. Ms. Heitz was also employed by the
Multi-Specialty Foundation, an international medical organization, from
November, 2004, through June, 2005.  She organized its annual
educational conference at the Bellagio Hotel in Las Vegas in
2006.  Ms. Heitz has served on the Board of Directors for Habitat for
Humanity, the Lexington Philharmonic Guild, and the McConnell’s Springs
Foundation.  She has built houses for Habitat for Humanity in Mexico,
Costa Rica, New Zealand, South Africa, Mongolia, and Cambodia.  Ms.
Heitz devotes 30% of her time to our business and the remaining 70% of her time
to family matters and public service.
 
 Mr. Terry
Riggleman, age 59, has been our Secretary and Director since March 1,
2007.  Since November, 2002, Terry Riggleman has been the customer
service manager for the Valley Gas and Oil Company in Moorefield, West
Virginia.  From 1970 to June, 2001, he was the manager of Arc Welders
in Baltimore, Maryland.  Mr. Riggleman devotes 2% of his time to our
business.
 
 Family
Relationships
 
 Terry
Riggleman is the brother of Viola J. Heitz.
 
 Legal
Proceedings
  No
officer, director, or persons nominated for such positions, promoter or
significant employee has been involved in the last five years in any of the
following:
  •
                Any
      bankruptcy petition filed by or against any business of which such person
      was a general partner or executive officer either at the time of the
      bankruptcy or within two years prior to that
  time;
  •
                Any
      conviction in a criminal proceeding or being subject to a pending criminal
      proceeding (excluding traffic violations and other minor
      offenses);
  •
                Being
      subject to any order, judgment, or decree, not subsequently reversed,
      suspended or vacated, of any court of competent jurisdiction, permanently
      or temporarily enjoining, barring suspending or otherwise limiting his
      involvement in any type of business, securities or banking activities;
      and
  23
 •
              Being
      found by a court of competent jurisdiction (in a civil action), the
      Commission or the Commodity Futures Trading Commission to have violated a
      federal or state securities or commodities law, and the judgment has not
      been reversed, suspended, or
vacated.
 
 Section 16(a) Beneficial
Ownership Reporting Compliance
 
 Section
16(a) of the Securities Exchange Act of 1934, as amended, requires the Company's
directors and executive officers, and persons who beneficially own more than 10%
of a registered class of the Company's equity securities, to file reports
of beneficial ownership and changes in beneficial ownership of the
Company's securities with the SEC on Forms 3 (Initial Statement of Beneficial
Ownership), 4 (Statement of Changes of Beneficial Ownership of Securities) and 5
(Annual Statement of Beneficial Ownership of Securities).  Based on
our records and other information, we believe that in 2008 our directors,
executive officers and shareholders owning 10% or more of the common stock of
Southern Bella, Inc. met all applicable SEC filing requirements.
 
 Code of
Ethics
 
 Southern
Bella, Inc. has adopted a Code of Ethics that applies to the Company’s principal
executive officer, principal financial officer, principal accounting officer and
any other senior executive officers.  Viola Heitz, the President of
Southern Bella, Inc. has executed the Code of Ethics.  A copy of the
Code of Ethics is attached as Exhibit 14 to this Annual Report on Form
10-K.
 
 Changes to Nomination
Process
 
 There
were no material changes to the procedures by which shareholders may recommend
nominees to Southern Bella, Inc.’s board of directors.
 
 Audit
Committee
 
 Southern
Bella, Inc. does not have a separately-designated audit
committee.  The entire board of directors serves as the audit
committee of the company.  Southern Bella, Inc. does not have an
“audit committee financial expert” as defined in the applicable rules and
regulations of the Securities Exchange Act of 1934, as amended.
 
 ITEM 11.
              EXECUTIVE
      COMPENSATION
  Compensation
Agreements
  Our
directors or officers have not received any compensation since Southern Bella,
Inc. was formed on February 22, 2007.
  24
 
 We have
no formal plan for compensating our directors for their service in their
capacity as directors; however, directors are entitled to reimbursement for
reasonable travel and other out-of-pocket expenses incurred in connection with
attendance at meetings of our board of directors.
  There are
no arrangements or plans in which we provide pension, retirement or similar
benefits for directors or executive officers. We do not have any bonus or profit
sharing plans pursuant to which cash or non-cash compensation is or may be paid
to our directors or executive officers.
 
 We have
not granted any stock options to any of our officers since inception and none of
our officers hold any options to purchase any shares of our common or preferred
stock.
 
 Employment
Agreements
  We do not
have employment agreements with either Viola J. Heitz or Terry Riggleman or any
other officer or employee except for the Consulting Agreement with Harriet
Dupree Bradley which terminated as of December 31, 2008.
 
 Director
Compensation
  We do not
pay directors any fees or other compensation for serving as a
director.  We have not granted any stock options or stock awards to
our directors.
  ITEM
12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT AND RELATED STOCKHOLDER MATTERS
  The
following table sets forth certain information concerning the number of shares
of our common stock owned beneficially as of March 31, 2009, by:  (i)
each person known by us to be the beneficial owner of more than 5% of our
outstanding common stock; (ii) each of our directors; (iii) each of our
officers; and (iv) our executive officers and directors as a group.
  Names
      and Address of
                          Beneficial
      Owner
                        
                        Shares
      of Common Stock
                          Beneficially
      OwnedNumber
                        
                        
                        PercentViola
      J. Heitz
                        
                        
                        8,166,667
                        
                        
                        
                        94
                        %Terry
      Riggleman
                        
                        
                        -
                        
                        
                        
                        -All
      Directors and named Executive Officers as a group
                          [2
      persons]
                        
                        
                        8,166,667
                        
                        
                        
                        94
                        %
 
 The table
above is based upon information derived from our stock
records.  Unless otherwise indicated in the footnotes to the table and
subject to community property laws where applicable, each of the shareholders
named in the table has sole or shared voting and investment power with respect
to the shares indicated as beneficially owned.  Except as set forth
above, applicable percentages are based upon 8,166,667 shares of common stock
outstanding as of March 31, 2009.
  25
 
 The
information presented above regarding beneficial ownership of our voting
securities has been presented in accordance with the rules of the Securities and
Exchange Commission and is not necessarily indicative of ownership for any other
purpose.  Under these rules, a person is deemed to be a “beneficial
owner” of a security if that person has or shares the power to vote or direct
the voting of the security or the power to dispose or direct the disposition of
the security.  A person is deemed to own beneficially any security as
to which such person has the right to acquire sole or shared voting or
investment power within 60 days through the conversion or exercise of any
convertible security, warrant, option or other right. More than one person may
be deemed to be a beneficial owner of the same securities.  The
percentage of beneficial ownership by any person as of a particular date is
calculated by dividing the number of shares beneficially owned by such person,
which includes the number of shares as to which such person has the right to
acquire voting or investment power within 60 days, by the sum of the number of
shares outstanding as of such date plus the number of shares as to which such
person has the right to acquire voting or investment power within 60
days.  Consequently, the denominator used for calculating such
percentage may be different for each beneficial owner.  Except as
otherwise indicated below and under applicable community property laws, we
believe that the beneficial owners of our common stock listed above have sole
voting and investment power with respect to the shares shown.
  We are
unaware of any contract or other arrangement the operation of which may at a
subsequent date result in a change in control of the company.
 
 Southern
Bella, Inc. does not have a compensation plan under which equity securities are
authorized for issuance.
  ITEM
13. CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR
INDEPENDENCE
 
 Related
Transactions
  Harriet
Dupree Bradley was the sole shareholder of Dupree Catering prior to the
acquisition of Dupree Catering by Southern Bella in March, 2007.
 
 Southern
Bella, Inc. was leasing office space consisting of approximately 3,000 square
feet located at 1006 Delaware Avenue, Lexington, Kentucky 40505 (the “Premises”)
from Harriet Dupree Bradley pursuant to a Lease Agreement dated March 1,
2007.  The lease was terminated in July, 2008, when the assets of
Dupree were sold.
  Director
Independence
  Our
directors, Viola Heitz and Terry Riggleman, are not independent under the NASDAQ
listing standards because they are executive officers of Southern Bella,
Inc.
  ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
  Audit
  For
fiscal year end December 31, 2008:  $14,500.00 (payable to M&K
CPAS, PLLC).
  26
  For
fiscal year end December 31, 2007:  $12,000.00 (payable to M&K
CPAS, PLLC).
  We did
not pay any other fees as specified in Item 9(e) of Schedule 14A.
  We do not
have audit committee pre-approval policies and procedures.
  ITEM
15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
  The
following exhibits are filed as part of this Form 10-K and this list includes
the Exhibit Index.
 
 No.
                      
                      Description(2)
                      
                      Share
      Purchase Agreement*(3)
                      
                      (i)
                      Articles
      of Incorporation *(ii)
                      Bylaws
      *(10)
                      
                      (i)
                      Lease
      Agreement with Harriet Dupree Bradley*(ii)
                      Consulting
      Agreement with Harriet Dupree Bradley dated March 1,
  2007*(iii)
                      Consulting
      Agreement with Harriet Dupree Bradley dated August 29,
    2007*(14)
                      
                      Code
      of Ethics(21)
                      
                      Subsidiaries
      of Registrant(31)
                      
                      Certification
      as Adopted Pursuant to Section 302 (a) of the Sarbanes-Oxley Act of
      2002(32
                      
                      Certification
      Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of
      Sarbanes-Oxley Act of
2002
 
 *  Incorporated herein by
reference from Southern Bella Inc.’s Registration Statement on Form SB-2, filed
with the Securities and Exchange Commission on November 14,
2007.
  27
  SIGNATURES
 
 In
accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
 
 Southern
      Bella, Inc.Date:  April
      14, 2009
                      
                      By:
                      /s/
      Viola HeitzName: Viola
      HeitzTitle:  
      President,
      Chief Executive Officer,
                        Principal
      Financial Officer, Principal
                        Accounting
      Officer, and
Director
 
 In
accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
 
 Date:
      April 14, 2009
                        
                        By:
                        /s/
      Viola HeitzName:   Viola
      HeitzTitle:  
      President, Chief Executive Officer,
                          Principal
      Financial Officer, Principal
                          Accounting
      Officer, and DirectorDate:
      April 14, 2009
                        
                        By:
                        /s/
      Terry RigglemanName: 
       Terry
      RigglemanTitle:  
      Director
  28