**UNITED
      STATES SECURITIES AND EXCHANGE COMMISSION**


**Washington,
      D.C. 20549**


**FORM
      10-KSB**


þ
            
            ANNUAL
                REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF
                1934.


**For
      the fis** **cal
      year ended December 31, 2006**


o
            
            TRANSITION
                REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
                ACT OF
                1934.





**Commission
      file number: 000-52357**


**JAVA
      DETOUR, INC.**


(Exact
      name of small business issuer as specified in its charter)


**Delaware**
            
            **20-5968895**(State
                or other jurisdiction of
              incorporation
                or organization)
            
            (I.R.S.
                Identification No.)





**2121
                Second Street**
              **Building
                C, Suite 105**
              **Davis,
                CA**
            
            **95618**(Address
                of principal executive offices)
            
            (Zip
                Code)





**(530)
      756-8020**


(Issuer’s
      telephone number, including area code)





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


**Common
      Stock, par value $0.001 per share**





(Title
      of
      Class)





Check
      whether the issuer is not required to file reports pursuant to Section 13
      or Section 15(d) of the Exchange Act. o .





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





Check
      if
      there is no disclosure of delinquent filers in response to Item 405 of
      Regulation S-B contained in this form, and no disclosure will 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-KSB or any
      amendment to this Form 10-KSB o .





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





State
      issuer’s revenue for its most recent fiscal year: $6,398,090





The
      aggregate market value of the Company’s shares of voting and non-voting stock
      held by non-affiliates of the Company at March 1, 2007was $33,510,985. Such
      value was computed by reference to the bid price of the Company’s shares of
      common stock at March 1, 2007; there was no ask price on such date. The
      Company’s shares of common stock are quoted in the Pink Sheets under the symbol
“JVDT.” No established trading market for the Company’s common stock has
      developed and management believes that the bid and ask price of the shares
      may
      not accurately reflect the value of the Company.









The
      number of shares outstanding of the issuer’s common equity as of March 1, 2007
      was 28,327,787.





Documents
      incorporated by reference:


**None**





Transitional
      Small Business Disclosure Format: o Yes x No









**TABLE
      OF CONTENTS**




PART
                  I
            
            
            
            PageITEM
                1.
            
            DESCRIPTION
                OF BUSINESS
            
            1ITEM
                2.
            
            DESCRIPTION
                OF PROPERTIES
            
            15ITEM
                3.
            
            LEGAL
                PROCEEDINGS
            
            16ITEM
                4.
            
            SUBMISSION
                OF MATTERS TO A VOTE OF SECURITY HOLDERS
            
            16PART
                IIITEM
                5.
            
            MARKET
                FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
            
            16ITEM
                6.
            
            MANAGEMENT’S
                DISCUSSION AND ANALYSIS AND RESULTS OF OPERATIONS
            
            18ITEM
                7.
            
            FINANCIAL
                STATEMENTS
            
            25ITEM
                8.
            
            CHANGES
                IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
                DISCLOSURE
            
            26ITEM 8A.
            
            CONTROLS
                AND PROCEDURES
            
            26ITEM 8B.
            
            OTHER
                INFORMATION
            
            26PART
                IIIITEM
                9.
            
            DIRECTORS,
                EXECUTIVE OFFICERS, PROMOTERS, CONTROL PERSON AND CORPORATE GOVERNANCE;
                COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
            
            26ITEM
                10.
            
            EXECUTIVE
                COMPENSATION
            
            29ITEM
                11.
            
            SECURITY
                OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
                STOCKHOLDER MATTERS
            
            32ITEM
                12.
            
            CERTAIN
                RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
            
            33ITEM
                13.
            
            EXHIBITS
            
            37ITEM
                14.
            
            PRINCIPAL
                ACCOUNTANT FEES AND SERVICES
            
            39SIGNATURES
            
            
            
            40Certification
                Pursuant to Rule 13a-14(a) or 15d-14(a)Certification
                Pursuant to Rule 13a-14(a) or 15d-14(a)Certification
                Pursuant to Section 906








**SPECIAL
      NOTE REGARDING FORWARD-LOOKING STATEMENTS**




**ADDITIONAL
      INFORMATION**




We
      are
      subject to the information and periodic reporting requirements of the Securities
      Exchange Act of 1934, as amended (the “Exchange Act”) and in accordance with the
      Exchange Act, we file annual, quarterly and special reports, and other
      information with the Securities and Exchange Commission (the “SEC”). These
      periodic reports and other information are available for inspection and copying
      at the regional offices, public reference facilities and website of the SEC
      referred to above.





Statements
      contained in this report about the contents of any contract or any other
      document that is filed as an exhibit are not necessarily complete, and we refer
      you to the full text of the contract or other document filed as an exhibit.
      A
      copy of annual, quarterly and special reports and related exhibits and schedules
      may be inspected without charge at the Public Reference Room maintained by
      the
      Board of Directors at 100 F Street, N.E., Washington, D.C. 20549, and copies
      of
      such reports may be obtained from the Board of Directors upon payment of the
      prescribed fee. Information regarding the operation of the Public Reference
      Room
      may be obtained by calling the Board of Directors at 1-800-SEC-0330. The Board
      of Directors maintains a web site that contains reports, proxy and information
      statements, and other information regarding registrants that file electronically
      with the SEC. The address of the site is www.sec.gov .





**PART
      I**





**ITEM
      1. DESCRIPTION OF BUSINESS**





Unless
      the context otherwise requires, the terms, “Company,” “we,” “us,” and “our” as
      used throughout this Annual Report refer to Java Detour, Inc. (formerly known
      as
      Media USA.com, Inc.), or “Java Detour,” a Delaware corporation as renamed in
      November 2006, our wholly-owned subsidiary, JDCO, Inc., a California corporation
      (“JDCO”), and JDCO’s wholly-owned subsidiary, Java Detour, a California
      corporation (“JDCO Subsidiary”).





**History**





On
      November 30, 2006, we entered into an Agreement and Plan of Merger (the “Merger
      Agreement”) with our wholly-owned subsidiary Java Acquisition Co., Inc. (“Merger
      Sub”) and JDCO, pursuant to which we acquired JDCO in a reverse merger
      transaction wherein Merger Sub merged with and into JDCO, with JDCO being the
      surviving corporation, and the shareholders of JDCO exchanging their shares
      of
      JDCO common stock for shares of Java Detour common stock (the “Merger”). On
      November 30, 2006, the Merger closed and JDCO became our wholly−owned
      subsidiary. We changed our corporate name from Media USA.com, Inc. to Java
      Detour, Inc.





**Overview**





We
      operate through JDCO and sell
      high
      quality gourmet coffees, whole leaf teas, cold blended beverages, fresh fruit
      smoothies and select baked goods primarily from company-owned and franchised
      retail stores. **** We
      operate and conduct our franchising business through JDCO Subsidiary. Our
      immediate goal is to capitalize on the success of our company-owned stores
      with
      a new national franchisee program that will help us expand the Java Detour®
brand into new domestic and international markets. All of our store locations,
      whether company-owned or franchised, will continue to focus on our core business
      concepts: consistently providing superior quality, convenience and customer
      service to all of our customers.





In
      a very
      competitive industry, we believe our Java Detour® stores successfully compete
      with other coffee retailers by offering premium quality beverages, fast service,
      superior convenience, quality franchise opportunities, and distinct and
      proprietary menu offerings. As a smaller boutique brand preparing for a national
      rollout plan, we believe we have to address our competition with efficient
      execution of our high speed drink preparation systems, utilizing our commercial
      grade pumps and specialized training procedures that are currently in place.




1




**Retail
      Stores**





Our
      portfolio of stores includes 14 company-owned and four franchised retail
      outlets. The following table sets forth the locations of each store in our
      portfolio.





**Company
                Store Locations**
            
            
            **Franchise
                Store Locations**1.
            Bakersfield,
                CA
            
            1.
            Rochester
                (#1), MN2.
            Chico
                (#1), CA
            
            2.
            Rochester
                (#2), MN3.
            Chico
                (#2), CA
            
            3.
            La
                Crosse, WI4.
            Citrus
                Heights, CA
            
            4.
            Madison,
                WI5.
            Las
                Vegas (Charleston), NV6.
            Las
                Vegas (Pecos), NV7.
            Las
                Vegas (Tropicana), NV8.
            Las
                Vegas (Warm Springs), NV9.
            Marysville,
                CA10.
            Red
                Bluff, CA11.
            Redding,
                CA12.
            San
                Francisco, CA13.
            San
                Rafael, CA14.
            Yuba
                City, CA





The
      following table sets forth our retail store revenues for the years ended
      December 31, 2006 and 2005 in U.S. dollars:





Year
                ended
              December
                31, 2006
            
            Year
                ended
              December
                31, 2005Company-owned
                Store Revenues
            
            6,317,946
            
            6,032,053Franchise
                Revenues
            
            80,144
            
            68,042Total
            
            6,398,090
            
            6,100,095





Within
      our portfolio of stores we offer four distinctly different store footprints
      designed for flexibility and compatibility within different development and
      retail venues:





·
            stand-alone
                600 square foot double drive-through store.


·
            stand
                alone 1,300 square foot single-lane drive-through store with inside
                seating.


·
            1,250
                square foot single-lane drive-through store with inside seating located
                in
                the end space of a multi-tenant commercial retail building.


·
            1,250
                square foot store without drive-though service located in an interior
                space of a multi-tenant commercial retail
                building.





**Store** ****** **Design
      and Atmosphere**





We
      work
      with a group of designers and architects specializing in retail kitchen design
      to ensure that our stores are ergonomically designed for speed and efficiency
      and outfitted with state-of-the art equipment. Our team works to ensure that
      every piece of equipment and product used to make our drinks is positioned
      such
      that unnecessary or excessive movement by our employees is minimized, thereby
      increasing our production and efficiency.





Each
      store features eye-catching contemporary branding designed to maximize customer
      throughput and drive sales volumes. Our busiest location regularly serves over
      135 cars per hour from its drive through lanes during peak morning hours. All
      of
      our stores afford customers quick and convenient access
      into the locations to facilitate fast and convenient customer service. Our
      stores that feature inside seating offer, in addition to fast, convenient
      service, a contemporary interior venue where people can meet, work or simply
      relax while enjoying our delicious beverages.




2




**Company-Owned
      Stores**





Our
      first
      drive-through gourmet beverage store opened in California in 1995. As of
      December 31, 2006, we owned and operated 10 locations in California and 4
      locations in Nevada. We believe that with each new store opening, brand
      awareness and customer loyalty continues to grow. We believe that as we continue
      to open new company-owned stores our credit worthiness and attractiveness as
      a
      tenant for real estate developers and as a viable franchise for potential new
      franchisees will also continue to increase.





We
      have
      signed a number of strategic agreements designed to expedite our national
      expansion. In June **** 2006,
      we
      entered into an oral development agreement with Focus Brands to open co-branded
      Java Detour®/Cinnabon stores both nationally and in our international
      development territories. While the oral agreement is not legally binding and
      therefore has no assurance of any performance, the first six Cinnabon co-branded
      test units are expected to be operational in Las Vegas and Northern California
      by the end of 2007. In August 2006, we signed an exclusive development agreement
      with Pavilion Development to develop up to 30 stores in Texas and Florida.
      Pursuant to the development agreement, we also designated Pavilion Development
      as a preferred developer for any new markets we consider going forward, meaning
      that Pavilion Development has a right of first refusal to develop stores for
      us
      in such new markets on terms substantially similar to those in our current
      agreement with Pavilion Development. Pursuant to the terms of our agreement,
      Pavilion Development is responsible for the entire development process, from
      identifying and selecting sites for the new store locations to negotiating
      with
      and contracting to purchase the designated sites to managing and supervising
      the
      construction process until the store is built and delivered to us according
      to
      our agreed upon specifications. The first store under the Pavilion Development
      agreement has been built and delivered to us with a scheduled store opening
      in
      June 2007 while the second store under the Pavilion Development agreement is
      currently in the planning stages. Both of these stores are located in Charlotte,
      NC. We are not obligated to approve and accept delivery of any stores from
      Pavilion Development unless such stores meet our specifications nor are we
      financially obligated to pay any fees to Pavilion Development under our
      agreement except to the extent that we approve and accept delivery of a store
      developed by Pavilion Development. As of December 31, 2006, we did not owe
      any
      fees to Pavilion Development. Beginning in June 2007, we will be obligated
      to
      pay Pavilion Development $4250 per month in rental fees for our first store
      developed by Pavilion Development.





**Franchised
      Stores**





The
      Java
      Detour® franchise opportunity attracts individuals seeking single store
      ownership, larger area developments and multi-unit operators interested in
      co-branding opportunities. We sold our first franchise area development in
      Minnesota and Wisconsin in 2000. In September 2006, we sold our first
      international territory; we sold the rights to franchise Java Detour® stores
      throughout Ireland with additional options to franchise in the United Kingdom
      pursuant to a master licensing agreement. As of December 31, 2006, we had four
      franchised stores in operation.





We
      evaluate and develop franchising opportunities based upon specific criteria,
      including demographics, traffic counts, competition, branding and marketing
      opportunities, and financial considerations. Franchisees must have sufficient
      financial and operating experience or abilities and their stores must maintain
      consistent high standard business practices. Franchising also offers challenges,
      including additional regulatory burdens, sharing of financial rewards with
      the
      franchisee and maintaining brand and operating standards in stores that are
      not
      operated by our employees. Certain real estate may not fit the profile of a
      company-owned store location but may be appropriate for a franchised location.
      Further, certain geographic markets may not be targeted for new company-owned
      stores in the near future, but may be good markets for immediate
      franchising.





Franchising
      is another method of raising capital and creating annuity income streams. For
      our franchised stores, we earn a one-time initial franchise fee for each
      individual location ranging from $28,500 to $33,500. Additionally, we receive
      an
      on-going annual royalty of 2-4% of monthly gross sales and advertising fees
      of
      1% of the franchised store’s annual gross sales. Furthermore, we may also supply
      our coffee and other store equipment supplies to the franchises at up to a
      20%
      mark-up above cost. Typically, the term for our franchise agreements is 15
      years, renewable in 10-year increments.




3




Pursuant
      to our franchise agreements, we provide comprehensive support services to our
      franchisees, including marketing programs, product sourcing, volume purchasing,
      customer service surveys, complete operations training and business
      consultation. We are required to provide our franchisees with operation manuals,
      site selection support, proprietary products and supplies, and assistance with
      building architecture drawings and national advertising campaigns. We have
      established an intensive in-house training program for our franchisees which
      includes two weeks of hands-on in store training on operations, coffee
      knowledge, merchandising, buying, inventory controls and accounting procedures.
      We work closely with franchisees on all issues pertaining to store operations;
      we also regularly survey franchise customers for feedback on product quality
      and
      customer service.





**Growth
      strategy**





Our
      business objective is to establish the Java Detour® brand as a successful
      nationally and internationally recognized gourmet beverage retail concept.
      We
      plan continued strategic expansion of our retail operations while simultaneously
      working to create other outlets and distribution points for sales of our freshly
      roasted whole bean coffees and other related proprietary products.





Key
      elements of our strategic planning include:





·
            *Increasing
                brand recognition and customer loyalty.*We
                believe we have particularly strong brand awareness in markets where
                we
                have a significant retail store presence. We believe our brand awareness
                has resulted from our marketing efforts, distinctive Java Detour
                branding
                and signage, and word of mouth; all of which help promote our brand
                as we
                expand into new markets. We continuously work to increase brand
                recognition and loyalty by improving the level and speed of customer
                service through training, improved technology and better daily execution.
                In addition, through cultivation of new relationships with other
                distribution channels, we hope to expand our brand awareness outside
                our
                existing markets through the sale of our coffee products by other
                distribution partners such as national food
                vendors.





·
            *Increasing
                comparable same store sales and operating margins.*We
                expect future growth in our retail segment to continue through continued
                increases in comparable same store sales as well as through continued
                increases in product and brand awareness with the introduction of
                new
                proprietary products and new advertising campaigns. Our customer
                gift/loyalty card was the latest successful program that we introduced,
                which rewards customers and helps foster brand loyalty. Also, with
                our new
                database reporting solution “Dashboard” we can now track current retail
                sales against historical data allowing us to react quicker to sales
                trends
                at the store level. This information enables field management to
                respond
                more quickly to opportunities and challenges in an effort to increase
                market share and bottom-line profits. As our comparable**retail
                store sales increase, we expect our operating margins at those retail
                stores to also continue to improve. In addition, we continue to improve
                operating margins by leveraging our purchasing power to negotiate
                better
                pricing.





·
            *Opening
                successful new company-owned stores throughout the
                country.*We
                continue to seek additional penetration in existing markets as well
                as in
                new domestic markets nationwide. In order to maximize expansion
                opportunities, we have created four different store footprints. These
                different store designs allow us to easily configure into multiple
                venues
                such as shopping centers, stand-alone commercial retail spaces, parking
                lots, airports, shopping malls and urban office spaces. We plan to
                expand
                our company-owned stores primarily throughout California, Arizona,
                Texas,
                Florida and Nevada with approximately 42 new retail locations planned
                by
                year-end 2009. Of these approximately 42 new locations, we plan to
                open
                approximately 5 double drive-through stores, 30 end-cap, single-lane
                drive-through stores and 7 stand-alone, single-lane drive through
                or
                in-line non-drive thru stores.





·
            *Expanding
                our franchise operations.*We
                intend to continue to afford strategic franchising domestically and
                abroad
                where we believe there are significant opportunities to develop and
                operate our brand. We believe strategic franchise development helps
                build
                brand awareness and add annuity revenue. We plan to expand our franchise
                retail operations throughout the country with approximately 82 new
                franchise locations planned by year-end 2009. We sold our first
                international territory in September 2006; the agreement was executed
                through a master license agreement to franchise throughout Ireland,
                with
                additional options for development throughout the United
                Kingdom.




4




·
            *Expanding
                complementary distribution channels.*We
                intend to continue expanding into complementary distribution channels
                to
                enhance our growth and brand awareness. For example, in the home
                delivery
                segment, we have a dedicated website and customer service representatives
                that provide points of contact to our customers for coffee ordering.
                Our
                website, www.javadetour.com, features express buy functions for return
                customers and special coffee-of-the-month programs. In late 2005,
                we
                launched our online coffee program which now allows customers to
                establish
                regular deliveries of their favorite fresh roasted coffee. In addition,
                over the course of the next 24 months, we will seek to exploit
                distribution channels such as grocery stores, mass merchandisers,
                office
                coffee providers, airlines, hotels and college campuses to boost
                sales and
                brand recognition. Our management team will work together to continue
                sourcing all of our products sold as well as establishing new accounts
                in
                other distribution channels.





·
            *Expanded
                menu offerings.*We
                intend to continue to expand and diversify our product offerings
                in an
                attempt to attract new customers and increase the frequency of visits
                by
                current customers. In 2005, we launched a new menu and unveiled several
                new products including specialty teas, children’s drinks and milkshakes.
                Our goal is to launch one new proprietary drink per year. Currently,
                we
                are working on two new iced tea beverages which we expect to launch
                in May
                2007. We anticipate spending approximately $5,000 to market these
                two new
                drinks that are initially estimated to make up less than 2% of overall
                store sales. Depending on how each product fares with our customers,
                we
                will determine whether to make the new beverages a permanent part
                of our
                menu offerings.We
                have also begun offering a variety of baked goods such as muffins,
                danishes, bars and cookies to our customers. Along
                with marketing materials, the new in-store menushelp
                guide customers through the process of choosing beverages and the
                right
                blend of coffee, all of which we believe helps build consumer loyalty
                and
                brand awareness.





**Site
      Selection**





We
      believe site selection for our retail locations is paramount to the success
      of
      our retail store growth strategy. We are constantly refining our site selection
      process to ensure superior site selection. When evaluating potential locations,
      we consider various site attributes, such as the type of venue, the potential
      for signage, and whether the location will feature a store design with inside
      seating, as well as the demographics and attributes of our existing retail
      store
      customer base. This process allows us to develop revenue forecasts and a
      financial plan for all potential locations. We search for geographic areas
      of
      expansion in which we believe there is significant demand for our products.
      Specifically, we target market areas that are close to freeways, schools,
      hospitals and other large traffic generators. After identifying a potential
      site, we develop a site plan, space plan and project budget that are approved
      by
      the appropriate management and personnel.





**Marketing**





We
      believe that consumer interest is increased, and incremental sales occur, when
      customers are informed about new Java Detour products, special offers, and
      the
      premium quality of our products. Accordingly, our strategies include advertising
      and marketing at the point-of-sale at our stores and outside of our stores.
      We
      have developed a successful strategy of using product photos and well designed
      point of sales pieces to help direct customers into the most profitable drinks
      and into drinks that can only be purchased at Java Detour® stores.





We
      employ
      targeted marketing strategies to increase brand awareness and encourage trial
      and repeat purchases by educating potential customers about the distinctive
      qualities of Java Detour® products. Our marketing efforts also promote repeat
      business by reinforcing positive experiences with our fast and friendly service.
      We rely on a mixture of marketing efforts that are tailored to the specific
      needs of particular markets or retail stores, including:




5




·
            point-of-purchase
                marketing, which encourages existing customers to try new products
                or
                services;


·
            direct
                marketing, which includes mailings and email distributions which
                are
                cost-effective methods to reach new customers and encourage repeat
                visits
                from existing customers;


·
            promotions
                and local retail store marketing, which allow us to alert customers
                to new
                products, seasonal merchandise and coupon programs; and


·
            print
                advertising, which includes advertising in newspapers and other
                publications to attract new customers within a particular
                market.





In
      addition, we receive free marketing through word-of-mouth communication from
      our
      current customers who tell their friends and colleagues about their enjoyable
      Java Detour® experiences, our quality products and our fast service.





**Coffee
      Beans**





We
      purchase our whole coffee beans from various coffee-producing regions around
      the
      world. We purchase our coffee beans from a roaster who is directly responsible
      for selecting the supplier, purchasing, roasting, packaging and distributing
      coffee beans directly to our Java Detour® stores. While we typically do not
      enter into exclusive supply contracts to purchase coffee beans, we do enter
      oral
      agreements for pricing for each 50,000 pounds purchased and we purchase whole
      coffee beans at the agreed upon price per pound on a net 30 basis. Currently,
      we
      purchase all of our coffee beans from Landgrove Coffee Co., a company co-owned
      by John Binninger, a brother of Michael and Steven Binninger, our Chief
      Executive Officer and Chief Operating Officer, respectively.





As
      of
      January 2007, we had commitments to purchase whole coffee beans at a total
      cost
      of $3.89 per pound for our house & french roast blend and $3.64 per pound
      for espresso and other coffee beans. Together with our existing coffee bean
      inventory, we expect to have an adequate supply of coffee beans through June
      30,
      2007. Going forward, we intend to continue to purchase green beans in the spot
      market at negotiated prices. Because we are not locked into an exclusive
      agreement with any particular supplier, we are able to negotiate with and
      purchase from various green bean suppliers throughout the country. While we
      currently purchase our coffee exclusively from Landgrove Coffee, we have
      relationships with other roasters who are capable of supplying us with our
      coffee beans. We believe that this flexibility will ensure that we are able
      to
      secure a sufficient supply of green beans going forward.





Additionally,
      Landgrove Coffee currently pays JDCO Subsidiary a rebate of $0.40 per pound
      for
      all coffee purchases from our franchisees in the Midwest.





**Dairy
      Products**





We
      obtain
      our dairy products from regional dairy suppliers. In our established markets,
      we
      generally have arrangements with a dairy supplier under which we purchase
      products for fixed prices based upon the commodity price plus a percentage.





**Other
      Non-Coffee Products**





We
      obtain
      the majority of our other non-coffee products, including specialty teas, paper
      and plastic goods and food items, from regional or national vendors such as
      Sysco Foods Inc.





**Competition**





The
      retail segment of the gourmet coffee industry remains highly fragmented and,
      with the exception of Starbucks Corporation, contains few companies with strong
      brand loyalty or a substantial national presence. In addition to Starbucks,
      our
      primary competitors in whole bean gourmet coffee sales are primarily regional
      or
      local market coffeehouses, such as Coffee Bean & Tea Leaf in the California
      market. As we continue to expand geographically, we expect to encounter
      additional regional and local competitors.





Premium
      coffee brands may serve as substitutes for our whole bean coffee and we also
      compete indirectly against all other coffee brands on the market.  In
      addition to competing with other distributors of whole bean coffee, we compete
      with retailers of prepared beverages, including other coffeehouse chains,
      numerous convenience stores, restaurants, coffee shops and street vendors.




6




Despite
      competing in a fragmented market, consumer demand has continued to rise and,
      as
      a result, gourmet coffee brands continue to develop across multiple distribution
      channels. Several competitors are aggressive in obtaining distribution in
      specialty grocery and gourmet food stores, and in office, restaurant and food
      service locations.





We
      believe that our customers choose among gourmet coffee brands based upon the
      quality and variety of the coffee and other products, atmosphere, convenience,
      customer service and, to a lesser extent, price. We believe that our market
      share in the gourmet coffee market is based on a differentiated position built
      on superior quality, convenience and consistently fast customer service.





**Government
      Regulation**





Each
      of
      our retail locations and our roaster’s facility is and will be subject to
      licensing and reporting requirements by a number of governmental authorities.
      These governmental authorities include federal, state and local health,
      environmental, labor relations, sanitation, building, zoning, fire, safety
      and
      other departments that have jurisdiction over the development and operation
      of
      these locations. Our activities are also subject to the Americans with
      Disabilities Act and related regulations, which prohibit discrimination on
      the
      basis of disability in public accommodations and employment. Changes in any
      of
      these laws or regulations could have a material adverse affect on our
      operations, sales, and profitability. Delays or failures in obtaining or
      maintaining required construction and operating licenses, permits or approvals
      could delay or prevent the opening of new retail locations, or could materially
      and adversely affect the operation of existing retail locations. In addition,
      we
      may not be able to obtain necessary variances or amendments to required
      licenses, permits or other approvals on a cost-effective or timely basis in
      order to construct and develop store locations in the future.





We
      believe that we are in compliance in all material respects with all such laws
      and regulations and that we have obtained all material licenses that are
      required for the operation of the business. We are not aware of any
      environmental regulations that have or that we believe will have a material
      adverse effect on our operations.





**Intellectual
      Property**




Intellectual
      property and other proprietary rights are considered an important part of our
      success. We place high value on our Java Detour® trade name, and we own several
      trademarks and service marks that have been registered with the United States
      Patent and Trademark Office, including Java Detour®, “Cold Rush,” “Feel the Cold
      Rush,” and “Changing the way America buys Coffee.”




In
      addition to registered and pending trademarks, we consider the packaging for
      our
      gourmet coffee beans and the ergonomic design of our stores to be strong
      identifiers of our brand. Although we consider our packaging and store design
      to
      be essential to our brand identity, we have not applied to register these
      trademarks and trade dress, and thus cannot rely on the legal protections
      afforded by trademark registration, although we have substantial protection
      under the existing family of marks that we have registered.




Our
      ability to differentiate our brand from those of our competitors depends, in
      part, on the strength and enforcement of our trademarks. We must constantly
      protect against any infringement by competitors. If a competitor infringes
      on
      our trademark rights, we may have to litigate to protect our rights, in which
      case, we may incur significant expenses and divert significant attention from
      our business operations.





**Employees**





As
      of
      December 31, 2006, we employed 143 employees, 61 of whom are employed full-time.
      133 of our employees were employed in our retail stores with the remainder
      in
      our corporate offices, and store and franchise development and operations.
      None
      of our employees is represented by a labor union and our relations with our
      employees are good.




7




**Risk
      Factors**





Any
      investment in our common stock involves a high degree of risk. Investors should
      carefully consider the risks described below and all of the information
      contained in this report before deciding whether to purchase our common stock.
      Our business, financial condition or results of operations could be materially
      adversely affected by these risks if any of them actually occur. Some of these
      factors have affected our financial condition and operating results in the
      past
      or are currently affecting us. This report also contains forward-looking
      statements that involve risks and uncertainties. Our actual results could differ
      materially from those anticipated in these forward-looking statements as a
      result of certain factors, including the risks faced by us described below
      and
      elsewhere in this report.




**RISKS
      RELATED TO OUR OPERATIONS**





**If
      we fail to continue to develop and maintain our brand, we may be unable to
      increase our future revenue or implement our business strategy and our business
      will suffer.**





We
      believe that maintaining and developing our brand
      is
      critical to our success
      and that the importance of brand recognition will likely increase as a result
      of
      competitors offering products similar to our products. Because
      the substantial majority of our retail locations are on the West Coast,
      primarily in California, our brand recognition remains largely regional. We
      intend
      to increase our marketing
      expenditures to create and maintain brand loyalty as well as increase awareness
      of our brand
      on
      a national level. However, if our brand-building strategy is unsuccessful,
      these
      expenses may never be recovered, and we may be unable to increase our future
      revenue or implement our business
      strategy.





**Because
      our business is highly dependent on a single product, gourmet coffee, we are
      vulnerable to changes in consumer preferences and economic conditions that
      could
      harm our financial results.**





Our
      business is not diversified and primarily consists of buying, blending and
      roasting coffee beans and operating gourmet coffee stores. Consumer preferences
      often change rapidly and without warning, moving from one trend to another
      among
      many product or retail concepts. Shifts in consumer preferences away from the
      gourmet coffee industry would have a material adverse effect on our results
      of operations. Our continued success will depend in part on our ability
      to anticipate, identify and respond quickly to changing consumer preferences
      and
      economic conditions.





**Because
      our California retail stores account for a substantial portion of our net
      revenue, we are susceptible to adverse trends and economic conditions in
      California.**





Our
      California retail stores generated 91.4% of our net revenue for the year ended
      December 31, 2006. We expect that our California operations will continue to
      generate the substantial portion of our revenue for the foreseeable future.
      In
      addition, our California retail stores provide us with means for increasing
      brand awareness, building customer loyalty and creating a premium gourmet coffee
      brand.  As
      a
      result, a worsening of economic conditions or a decrease in consumer spending
      in
      California may not only lead to a substantial decrease in revenue, but may
      also
      adversely impact our ability to market our brand, build customer loyalty, or
      otherwise implement our business strategy.





**We
      compete with a number of companies for customers. Our business would be
      adversely affected by the success of these competitors.**





The
      retail segment of the gourmet coffee industry remains highly fragmented and,
      with the exception of Starbucks, contains few companies with strong brands. Our primary
      competitors for gourmet coffee sales are other gourmet coffeehouses and
      restaurants. In all markets in which we do business, there are numerous
      competitors in the gourmet coffee industry, and we expect
      this situation to continue. Starbucks is the gourmet coffeehouse segment leader.
      We also
      compete with numerous convenience stores, restaurants and coffee shops and
      we must
      spend significant resources to differentiate our customer
      experience (which is defined by convenient store locations, customer service
      and
      ergonomic store design and convenience) from the offerings of our competitors.
      Despite these efforts, our competitors
      still may be successful in attracting our customers.




8




Aside
      from Starbucks, our primary
      competitors in whole bean gourmet coffee sales are primarily regional or local
      market coffeehouses. As we continue to expand geographically, we expect to
      encounter additional regional and local competitors.





Competition
      in the gourmet coffee industry is becoming increasingly intense as relatively
      low barriers to entry encourage new competitors to enter the market. The
      financial, marketing and operating resources of these new market entrants may
      be
      greater than our resources.
      In addition, some of our existing
      competitors have substantially greater financial, marketing and operating
      resources. Our failure
      to compete successfully against current or future competitors could have an
      adverse effect on our business,
      including loss of customers, declining net sales and loss of market
      share.





**Our
      new retail locations may not achieve market acceptance or the same levels of
      profitability in the geographic regions we enter or be profitable in existing
      markets, therefore placing a significant strain on our financial resources
      and
      potentially limiting our ability to further expand our
      business.**





Our
      expansion plans depend in large part on opening retail locations in new markets
      where we may have little or no operating experience. The success of these new
      locations will be affected by the different competitive conditions, consumer
      tastes and discretionary spending patterns of the new markets we enter, as
      well
      as our ability
      to generate market awareness of the Java Detour® brand. Although we have opened
      eight locations, four of which are company-owned, in markets outside California
      and expect to continue to do so, we may not achieve the same levels of
      profitability at these other locations as we have with those located in
      California.





In
      addition, our expansion plans also depend on opening new locations in existing
      markets. New locations may take longer to reach profitability, thereby affecting our overall
      profitability and results of operations. Moreover, we  may
      not
      be successful in operating our new locations on a profitable basis. In addition, our failure
      to achieve market acceptance or profitability at one or more of our new retail
      locations could put a significant strain on our financial
      resources and could limit our ability to further expand our business.





**If
      we are unable to continue leasing our retail locations or obtain leases for
      new
      stores, our existing operations and our ability to expand may be adversely
      affected.**





All
      but
      two of our retail locations are presently located on leased premises. If we
      are
      unable to renew these leases, which average between 5 to 15 years remaining
      on
      the leases, our revenues and profits could suffer. Additionally, we intend
      to
      lease other premises in connection with the planned expansion of our retail
      locations. Because we compete with other retailers and restaurants for store
      sites and some landlords may grant exclusive locations to our competitors,
      we
      may not be able to obtain new leases in some markets on acceptable terms. This
      could adversely impact our revenue growth and brand building initiatives in
      some
      localized markets.





**Our
      growth through franchising may not occur as rapidly as we currently anticipate
      and may be subject to additional risks related to our lack of control over
      the
      quality and timing of our franchised operations.**





As
      part
      of our growth
      strategy, we intend to continue to seek franchisees to operate retail locations
      under the Java Detour® brand in selected geographic markets. We believe that our ability
      to recruit,
      retain and contract with qualified franchises will be increasingly important
      to
      our operations as we expand. Our franchisees are dependent upon the availability
      of adequate sources of financing in order to meet their development obligations.
      Such financing may not be available to our franchisees, or only available upon
      disadvantageous terms. Our franchise strategy may not enhance our results of
      operations. In addition, retail store openings contemplated under our existing
      franchise agreements or any future franchise agreement may not open on the
      anticipated development schedule or at all.




Expanding
      through franchising exposes our business and brand to risks because the quality
      of franchised operations will be beyond our immediate control. Even if we have
      contractual remedies to cause franchisees to maintain operational standards,
      enforcing those remedies may require litigation and therefore our image and
      reputation may suffer, unless and until such litigation is successfully
      concluded.




9




**Because
      we rely heavily on third party carriers to deliver our coffee, any disruption
      in
      their services or increase in shipping costs could adversely affect our sales
      and profitability.**





We
      rely
      on a number of third party carriers to deliver coffee to our distribution facility, our roaster and our store
      locations, as well as to Internet-order customers. We have no control over
      these
      carriers and the services provided by them may be interrupted or disrupted
      as a
      result of labor shortages, contract disputes or other factors. If we experience
      an interruption or disruption in these services, it may be unable to ship our
      coffee in a timely manner. A delay in shipping could:





·
            have
                an adverse impact on the quality of the coffee shipped, and thereby
                adversely affectourbrand
                and reputation;


·
            result
                in the disposal of an amount of coffee that could not be shipped
                in a
                timely manner; and


·
            require
                us to contract with alternative, and possibly more expensive, third
                party
                carriers.





Any
      significant increase in shipping costs could lower our profit margins or force
      us to raise prices, which could cause our profits
      to suffer.





**A
      significant interruption in the operation of our distribution facility or in
      our
      coffee roaster’s operations could potentially disrupt our
      operations.**





We
      have
      only one distribution facility and currently rely on only one coffee roaster
      to
      provide roasting services to us. A significant interruption in the operation
      of
      these facilities, whether as a result of broken equipment, a natural disaster
      or
      other causes, could significantly impair our ability to operate the business
      on
      a day-to-day basis.





**Our
      roasting methods are not proprietary, so competitors may be able to duplicate
      them, which could harm our competitive position.**





We
      consider our roasting
      methods essential to the flavor and richness of our roasted
      whole bean coffee and, therefore, essential to our brand.
      Because we do not hold any patents for our roasting
      methods, it may be difficult for us to prevent competitors from copying our roasting
      methods. If our competitors
      copy our roasting
      methods, the value of the Java Detour® brand may be diminished, and we may lose
      customers to our competitors.
      Additionally, competitors may be able to develop roasting methods that are
      more
      advanced than our roasting
      methods, which may also harm our competitive
      position.





**Compliance
      with health, environmental, safety and other governmental regulations applicable
      to us could increase cost and affect profitability.**





Each
      of
      our retail locations and our roaster’s facility is and will be subject to
      licensing and reporting requirements by a number of governmental authorities.
      These governmental authorities include federal, state and local health,
      environmental, labor relations, sanitation, building, zoning, fire, safety
      and
      other departments that have jurisdiction over the development and operation
      of
      these locations. Our activities are also subject to the Americans with
      Disabilities Act and related regulations, which prohibit discrimination on
      the
      basis of disability in public accommodations and employment. Changes in any
      of
      these laws or regulations could have a material adverse affect on our
      operations, sales, and profitability. Delays or failures in obtaining or
      maintaining required construction and operating licenses, permits or approvals
      could delay or prevent the opening of new retail locations, or could materially
      and adversely affect the operation of existing retail locations. In addition,
      we
      may not be able to obtain necessary variances or amendments to required
      licenses, permits or other approvals on a cost-effective or timely basis in
      order to construct and develop store locations in the future.





**We
      may not be able to adequately protect our intellectual property, which could
      harm the value of our brand and adversely affect our sales and
      profitability.**





The
      success of our retail locations depends in part on the Java Detour® brand,
      logos, branded merchandise and other intellectual property. We rely on a
      combination of trademarks, copyrights, service marks, trade secrets and similar
      rights to protect our intellectual property. The success of our growth strategy
      depends on our continued ability to use our existing trademarks and service
      marks in order to increase brand awareness and further develop our brand in
      both
      domestic and international markets. We also use our trademarks and other
      intellectual property on the Internet. If our efforts to protect our
      intellectual property are not adequate, or if any third party misappropriates
      or
      infringes on our intellectual property, either in print or on the Internet,
      the
      value of the Java Detour® brand may be harmed, which could have a material
      adverse effect on our business. We may become engaged in litigation to protect
      our intellectual property, which could result in substantial costs to us as
      well
      as diversion of management attention.




10




**We
      will likely need to raise significant additional capital in order to continue
      to
      grow our business, which subjects us to the risks that we may be unable to
      maintain or grow our business as planned or that our shareholders may be subject
      to substantial additional dilution.**




We
      will
      likely need to raise additional capital in the future to fund the continued
      growth and expansion of our business. We
      may
      also require additional capital to respond to competitive pressures, to make
      capital improvements at our retail locations or to acquire necessary
      technologies. We do not know if we will be able to raise additional financing
      or
      financing on terms favorable to us. If adequate funds are not available or
      are
      not available on acceptable terms, our ability to fund our operations, develop
      and expand our business or otherwise respond to competitive pressures would
      be
      significantly impaired. In such a case, our stock price would likely be
      materially and adversely impacted.





In
      addition, if we raise additional funds through the issuance of equity or
      convertible or exchangeable securities, the percentage ownership of our existing
      shareholders will be reduced. These newly issued securities may have rights,
      preferences and privileges senior to those of existing
      shareholders.





**Future
      growth may make it difficult to effectively allocate our resources and manage
      our business.**





As
      we
      continue to develop additional retail locations and investigate licensing
      opportunities, we will need to allocate our resources effectively. Our growth
      has and will continue to increase our operating complexity and the level of
      responsibility for new and existing management. Our anticipated growth could
      place a strain on our management, production, financial and other resources.
      We
      cannot assure you that we will be able to manage any future growth effectively.
      Any failure to manage our growth effectively could have an adverse effect on
      our
      business, financial condition and results of operations. Our
      ability to compete effectively and to manage our recent
      and future growth effectively will depend on our ability
      to implement and improve financial and management information systems on a
      timely basis and to effect changes in our business,
      such as implementing internal controls to handle the increased size of our operations
      and hiring, training, developing and managing an increasing number of
      experienced management-level and other employees. Unexpected difficulties during
      expansion, the failure to attract and retain qualified employees or our
      inability to respond effectively to recent growth or plan for future growth
      could adversely affect our ability
      to implement our business
      strategy or our results
      of operations.





**We
      depend on key members of our management and will need to add and retain
      additional management and other personnel in order to effectively compete in
      our
      industry.**





The
      success of our business to date has been, and our continuing
      success will depend, to a large degree on the continued services of our
      executive officers, especially our Chief Executive Officer, Michael Binninger,
      and our Founder and Chief Operating Officer, Steven Binninger, and other key
      personnel who have extensive experience in the gourmet coffee industry. If
      we
      lose the services of any of these integral personnel and fail to manage a smooth
      transition to new personnel, our business
      would suffer. We do carry key person life insurance on our executive
      officers.





The
      success of our business
      also depends on our ability
      to attract and retain highly motivated, well-qualified management and other
      personnel, including technical personnel and retail employees. We face
      significant competition in the recruitment of qualified employees and there
      can
      be no assurance that we will be able to retain our existing
      personnel or attract additional qualified employees. The loss of key personnel
      or the inability to hire and retain additional qualified management and other
      personnel in the future could have a material adverse effect on our business,
      financial condition and results of operation.




11




**RISKS
      RELATED TO OUR INDUSTRY**





**A
      shortage in the supply, or an increase in the price, of coffee beans could
      adversely affect our net sales.**





The
      supply and price of whole coffee beans are subject to significant volatility.
      Although most coffee beans are traded in the commodity market, the green coffee
      beans we buy tend to trade on a negotiated basis at a substantial premium above
      commodity coffee prices, depending upon the supply and demand at the time of
      purchase. **** Supply
      and price can be affected by multiple factors in the producing countries,
      including weather, natural disasters, political and economic conditions or
      civil
      unrest or strikes due to the poor conditions imposed on many coffee farmers.
      In
      addition, coffee bean prices have been affected in the past, and may be affected
      in the future, by the actions of certain organizations and associations that
      have historically attempted to influence commodity prices of coffee beans
      through agreements establishing export quotas or restricting coffee supplies
      worldwide. Our ability to raise sales prices in response to rising coffee bean
      prices may be limited, and our profitability could be adversely affected if
      coffee bean prices were to rise substantially. Moreover, passing price increases
      on to our customers could result in losses in sales volume or margins in the
      future. Similarly, rapid sharp decreases in the cost of coffee beans could
      also
      force us to lower sales prices before we have realized cost reductions in our
      coffee bean inventory.





**Adverse
      publicity regarding customer complaints may negatively impact our brand image
      and therefore harm our business.**





We
      may be
      the subject of complaints or litigation from customers alleging beverage and
      food-related illnesses, injuries suffered on the premises or other quality,
      health or operational concerns. Adverse publicity resulting from such
      allegations may materially adversely affect us, regardless of whether such
      allegations are true or whether we are ultimately held liable.





**We
      face the risk of fluctuations in the cost, availability and quality of our
      non-coffee raw ingredients, all of which could have an adverse effect on our
      profitability.**





The
      cost,
      availability and quality of non-coffee raw ingredients for our products are
      subject to a range of factors. Fluctuations in economic and political
      conditions, weather and demand could adversely affect the cost of our
      ingredients. We have limited supplier choices dependent on frequent deliveries
      of fresh ingredients, thereby subjecting us to the risk of shortages or
      interruptions in supply. In particular, the supply and price of dairy products
      are subject to significant volatility. Our ability to raise sales prices in
      response to increases in prices of these non-coffee raw ingredients may be
      limited, and our profitability could be adversely affected if the prices of
      these ingredients were to rise substantially.





**Adverse
      public or medical opinion about caffeine may reduce our sales and profits.**





Our gourmet
      coffee contains significant amounts of caffeine and other active compounds,
      the
      health effects of some of which are not fully understood. A number of research
      studies conclude or suggest that excessive consumption of caffeine may lead
      to
      increased heart rate, nausea and vomiting, restlessness and anxiety, depression,
      headaches, tremors, sleeplessness and other adverse health effects. An
      unfavorable report on the health effects of caffeine or other compounds present
      in coffee could significantly reduce the demand for coffee, which could harm our business
      and reduce our sales
      and
      profits.





**RISKS
      RELATED TO OUR CAPITAL STRUCTURE**





**There
      is no assurance of an established public trading market, which would adversely
      affect the ability of investors to sell their securities in the public
      market.**





Although
      our common stock is quoted in the Pink Sheets, a regular trading market for
      the
      securities may not be sustained in the future. Quotes for stocks listed on
      the
      Pink Sheets are not listed in the financial sections of newspapers and
      newspapers generally have very little coverage of stocks listed solely on the
      Pink Sheets. Accordingly, prices for and coverage of securities traded solely
      on
      the Pink Sheets may be difficult to obtain. In addition, stock traded solely
      on
      the Pink Sheets tend to have a limited number of market makers and a larger
      spread between the bid and ask prices than those listed on the NYSE, AMEX or
      NASDAQ exchanges, or the OTC.BB. All of these factors may cause holders of
      our
      common stock to be unable to resell their securities at or near their original
      offering price or at any price.




12




Market
      prices for our common stock will be influenced by a number of factors,
      including:





·
            changes
                in interest rates;


·
            competitive
                developments, including announcements by competitors of new products
                of
                services or significant contracts, acquisitions, strategic partnerships,
                joint ventures or capital commitments;


·
            variations
                in quarterly operating results;


·
            changes
                in financial estimates by securities
                analysts;


·
            the
                depth and liquidity of the market for our common stock;


·
            investor
                perceptions of our company after the Merger;
                and


·
            general
                economic and other national
                conditions.





**We
      recognized a change to our earnings as a result of the Merger and also may
      not
      be able to achieve the benefits we expect to result from the
      Merger.**




On
      November 30, 2006, we entered into the Merger Agreement with Merger Sub and
      JDCO, pursuant to which we acquired JDCO in a reverse merger transaction with
      JDCO becoming our wholly-owned subsidiary and our sole business operations
      becoming that of JDCO. Also, the management and directors of JDCO became our
      management and directors and we changed our corporate name to Java Detour,
      Inc.





We
      issued
      793,403 **** shares
      of
      common stock to Hunter upon closing of the Merger for services rendered. We
      accounted for these shares as a non-reoccurring general and administrative
      expense for services rendered and, as a result, our earnings on a consolidated
      basis were reduced for the quarter and year ending December 31, 2006 by the
      amount of the expenses, which was equal to the fair market value of the shares. As
      a
      result of the reduction in earnings of $793,403, our results of operation for
      the quarter and year ending December 31, 2006 suffered and the value of our
      common stock and your investment may fall.





The
      Merger was effected for various reasons, including:





·
            access
                to the public capital markets;


·
            the
                increased market liquidity expected to result from exchanging stock
                in a
                private company for securities of a public company that may eventually
                be
                traded;


·
            the
                ability to use registered securities to make acquisition of assets
                or
                businesses;


·
            increased
                visibility in the financial
                community;


·
            enhanced
                access to the capital markets;


·
            improved
                transparency of operations; and


·
            perceived
                credibility and enhanced corporate image of being a publicly traded
                company.





There
      can
      be no assurance that any of the anticipated benefits of the Merger will be
      realized. In addition, the attention and effort devoted to achieving the
      benefits of the Merger and attending to the obligations of being a public
      company, such as reporting requirements and securities regulations, could
      significantly divert management’s attention from other important issues, which
      could materially and adversely affect our operating results or stock price
      in
      the future.





**Our
      principal shareholders have significant influence over our company and their
      interests may differ from the interests of our other
      stockholders.**




Michael
      Binninger, Ronald Sands, and Steven Binninger, and their respective affiliates,
      beneficially own, in the aggregate, 31.5% of our outstanding shares. As a
      result, these principal shareholders possess significant influence over the
      election of the Board of Directors and to the approval of significant corporate
      transactions. Such share ownership and control may also have the effect of
      delaying or preventing a future change in control, impeding a merger,
      consolidation, takeover or other business combination or discouraging a
      potential acquirer from making a tender offer or otherwise attempting to obtain
      control of our company. The interests of these principal shareholders may differ
      from the interests of our other
      shareholders.




13




**If
      we fail to maintain effective internal controls over financial reporting, the
      price of our common stock may be adversely affected.**





Our
      internal control over financial reporting may have weaknesses and conditions
      that need to be addressed, the disclosure of which may have an adverse impact
      on
      the price of our common stock. We are required to establish and maintain
      appropriate internal controls over financial reporting. Failure to establish
      those controls, or any failure of those controls once established, could
      adversely impact our public
      disclosures regarding our business, financial condition or results of
      operations. In addition, management’s assessment of internal controls over
      financial reporting may identify weaknesses and conditions that need to be
      addressed in our internal
      controls over financial reporting or other matters that may raise concerns
      for
      investors. Any actual or perceived weaknesses and conditions that need to be
      addressed in our internal
      control over financial reporting, disclosure of management’s assessment of our internal
      controls over financial reporting or disclosure of our public
      accounting firm’s attestation to or report on management’s assessment of our internal
      controls over financial reporting may have an adverse impact on the price of our common
      stock.





**Compliance
      with changing regulation of corporate governance and public disclosure will
      result in additional expenses.**




Changing
      laws, regulations and standards relating to corporate governance and public
      disclosure, including the Sarbanes-Oxley Act of 2002 and related SEC
      regulations, have created uncertainty for public companies and significantly
      increased the costs and risks associated with accessing the United States public
      markets and related public reporting obligations. Our management team will
      need
      to invest significant management time and financial resources to comply with
      both existing and evolving standards for public companies, which will lead
      to
      increased general and administrative expenses and a diversion of management
      time
      and attention from revenue generating activities to compliance
      activities.





**Standards
      for compliance with Section 404 of the Sarbanes-Oxley Act of 2002 are uncertain,
      and if we fail to comply in a timely manner, our business could be harmed and
      our stock price could decline.**




Rules
      adopted by the SEC pursuant to Section 404 of the Sarbanes-Oxley Act of 2002
      require annual assessment of our internal
      control over financial reporting, and attestation of this assessment by our independent
      registered public accountants. The SEC extended the compliance dates for
      non-accelerated filers, as defined by the SEC. Accordingly, we believe
      that this requirement will first apply to our annual report for fiscal year
      2007. The standards that must be met for management to assess the internal
      control over financial reporting as effective are new and complex, and require
      significant documentation, testing and possible remediation to meet the detailed
      standards. We may
      encounter problems or delays in completing activities necessary to make an
      assessment of our internal control over financial reporting. In addition, the
      attestation process by our independent registered public accountants is new
      and
      we may encounter problems or delays in completing the implementation of any
      requested improvements and receiving an attestation of our assessment by our
      independent registered public accountants. If we cannot assess our internal
      control over financial reporting as effective, or our independent
      registered public accountants are unable to provide an unqualified attestation
      report on such assessment, investor confidence and share value may be negatively
      impacted.





**Our** **common
      stock is considered a “penny stock,” and is thereby subject to additional sale
      and trading regulations that may make it more difficult to
      sell.**




Our common
      stock is considered to be a “penny stock” because it does not qualify for one of
      the exemptions from the definition of “penny stock” under Section 3a51-1 of the
      Exchange Act. Our common
      stock may be a “penny stock” if it meets one or more of the following conditions
      (i) the stock trades at a price less than $5.00 per share; (ii) it is NOT traded
      on a “recognized” national exchange; (iii) it is not quoted on the Nasdaq
      Capital Market, or even if so, has a price less than $5.00 per share; or (iv)
      is
      issued by a company that has been in business less than three years with net
      tangible assets less than $5.0 million.




14




The
      principal result or effect of being designated a “penny stock” is that
      securities broker-dealers participating in sales of our common
      stock will be subject to the “penny stock” regulations set forth in Rules 15-2
      through 15g-9 promulgated under the Exchange Act. For example, Rule 15g-2
      requires broker-dealers dealing in penny stocks to provide potential investors
      with a document disclosing the risks of penny stocks and to obtain a manually
      signed and dated written receipt of the document at least two business days
      before effecting any transaction in a penny stock for the investor’s account.
      Moreover, Rule 15g-9 requires broker-dealers in penny stocks to approve the
      account of any investor for transactions in such stocks before selling any
      penny
      stock to that investor. This procedure requires the broker-dealer to (i) obtain
      from the investor information concerning his or her financial situation,
      investment experience and investment objectives; (ii) reasonably determine,
      based on that information, that transactions in penny stocks are suitable for
      the investor and that the investor has sufficient knowledge and experience
      as to
      be reasonably capable of evaluating the risks of penny stock transactions;
      (iii)
      provide the investor with a written statement setting forth the basis on which
      the broker-dealer made the determination in (ii) above; and (iv) receive a
      signed and dated copy of such statement from the investor, confirming that
      it
      accurately reflects the investor’s financial situation, investment experience
      and investment objectives. Compliance with these requirements may make it more
      difficult and time consuming for holders of our common
      stock to resell their shares to third parties or to otherwise dispose of them
      in
      the market or otherwise.





**We
      do not foresee paying cash dividends in the foreseeable future.**




We currently
      intend to retain any future earnings for funding growth. We do
      not
      anticipate paying any dividends in the foreseeable future. As a result, you
      should not rely on an investment in our securities
      if you require dividend income. Capital appreciation, if any, of our shares
      may
      be your sole source of gain for the foreseeable future. Moreover, you may not
      be
      able to resell your shares in our
      company at or
      above the price you paid for them.





**Shares
      eligible for future sale may adversely affect the market price of our common
      stock, as the future sale of a substantial amount of outstanding stock in the
      public marketplace could reduce the price of our common
      stock.**





Pursuant
      to the terms of the Merger, we filed a registration statement with the SEC
      to
      register a total of 9,442,593 shares
      of
      our common stock sold in a $10.0 million private placement (the “Private
      Placement”) that closed immediately prior to the close of the Merger. We also
      agreed to register the remaining shares of common stock sold in the Private
      Placement, the shares underlying the warrants sold to investors in the Private
      Placement and 4,418,403 shares of common stock which are owned by Hunter World
      Markets, Inc. (“Hunter”) and its affiliates, which includes the shares
      underlying the warrants issued to Hunter further to the Bridge Financing and
      Private Placement. Such shares would be included in a subsequent registration
      statement filed by us within ten days after June 29, 2007. All of the shares
      included in an effective registration statement as described above may be freely
      sold and transferred except if subject to a lock up agreement.





Additionally,
      following the Merger, the former stockholders of JDCO may be eligible to sell
      all or some of our shares of common stock by means of ordinary brokerage
      transactions in the open market pursuant to Rule 144, promulgated under the
      Securities Act (“Rule 144”), subject to certain limitations. In general,
      pursuant to Rule 144, a stockholder (or stockholders whose shares are
      aggregated) who has satisfied a one-year holding period may, under certain
      circumstances, sell within any three-month period a number of securities which
      does not exceed the greater of 1% of the then outstanding shares of common
      stock
      or the average weekly trading volume of the class during the four calendar
      weeks
      prior to such sale. As of the closing of the Merger, 1% of our issued and
      outstanding shares of common stock was approximately 283,278 shares. Rule 144
      also permits, under certain circumstances, the sale of securities, without
      any
      limitations, by a non-affiliate that has satisfied a two-year holding period.
      Any substantial sale of common stock pursuant to any resale prospectus or Rule
      144 may have an adverse effect on the market price of our common stock by
      creating an excessive supply.





**ITEM
      2. DESCRIPTION OF PROPERTIES**





Our
      executive offices, product development and manufacturing operations are located
      in Davis, California, in a leased facility consisting of approximately 2,937
      square feet. Pursuant to our lease agreement expiring on December 31, 2010,
      we
      pay a base rent of $3,377.50 per month, subject to adjustment pursuant to the
      terms of the lease agreement, to lease our offices.




15




We
      also
      lease all but two of our company-owned store facilities. All of our existing
      leases for such facilities are for **** 5
      to 15
      years with none of such leases scheduled to expire before 2011 and the majority
      of those leases not scheduled to expire for at least 10 years. Additionally,
      we
      have the option to renew all but one of the leases for a significant renewal
      term. We regularly evaluate the economic performance of our company-owned stores
      and, when feasible, close or sell ones that do not meet our expectations. In
      reviewing economic performance, we typically review profitability and sales
      growth of each of our company-owned stores on a continuous basis. In conjunction
      with this review, we also analyze cash flows from operations to determine the
      impact of a particular store’s cash contribution on our overall financial
      health. We also consider certain intangible variables such as the consumer
      brand
      recognition generated by a particular store before making the decision to sell
      an otherwise underperforming store. In the event that we determine that a
      particular store location is not, and cannot be, managed to provide an economic
      benefit to us, then we close or sell such store. To date, we have only sold
      one
      underperforming store.





**ITEM
      3. LEGAL PROCEEDINGS**





We
      are
      not aware of any pending or threatened legal proceedings involving our company
      or our assets.





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





During
      the quarter ended December 31, 2006, our Board of Directors took action by
      written consent in lieu of a special meeting of shareholders on November 29,
      2006, and, with unanimous approval, authorized the Merger and appointed Michael
      Binninger, Steven Binninger and Ronald Sands to the Board of Directors in
      conjunction with the Merger. The action taken by our Board of Directors, and
      the
      related events and transactions are described in our registration statement
      on
      Form 10-SB, filed with the SEC on December 8, 2006, and Current Report on Form
      8-K, filed with the SEC on December 8, 2006 and as amended on December 11,
      2006.





**PART
      II**




**ITEM
      5.** **MARKET
      FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS**




Our
      shares of common stock are currently quoted for trading on Pink Sheets under
      the
      symbol “JVDT.” Prior to December 22, 2006, our shares were listed under the
      symbol “MUCI.” The following table shows the high and low bid prices for our
      common stock on Pink Sheets for each quarter over the last two fiscal years.
      The
      following quotations reflect inter-dealer prices, without ret ail
      mark-up, mark-down or commission and may not necessarily represent actual
      transactions:




**2005****High**
            
            
            **Low**Quarter
                ended:March 30,
                2005
            
            
            None
            
            
            
            NoneJune 30,
                2005
            
            
            None
            
            
            
            NoneSeptember 30,
                2005
            
            
            None
            
            
            
            NoneDecember 31,
                2005
            
            
            None
            
            
            
            None




**2006****High**
            
            
            **Low**Quarter
                ended:March
                30, 2006
            
            
            None
            
            
            
            NoneJune 30,
                2006
            
            
            None
            
            
            
            NoneSeptember 30,
                2006
            
            $
            0.52
            
            
            $
            0.24December
                31, 2006
            
            
            2.24
            
            
            
            0.24





On
      March
      1, 2007, the closing bid price for our common stock in the Pink Sheets was
      $2.50
      per share; the price will likely fluctuate in the future. The stock market
      in
      general has experienced extreme stock price fluctuations in the past few years.
      In some cases, these fluctuations have been unrelated to the operating
      performance of the affected companies. Many companies have experienced dramatic
      volatility in the market prices of their common stock. We believe that a number
      of factors, both within and outside our control, could cause the price of our
      common stock to fluctuate, perhaps substantially. Factors such as the following
      could have a significant adverse impact on the market price of our common
      stock:




16




·
            Our
                ability to obtain additional financing and, if available, the terms
                and
                conditions of the financing;


·
            Our
                financial position and results of
                operations;


·
            Our
                ability to execute our business
                plan;


·
            The
                development of litigation against our
                company;


·
            Period-to-period
                fluctuations in our operating
                results;


·
            Changes
                in estimates of our performance by any securities
                analysts;


·
            The
                issuance of new equity securities pursuant to a future offering or
                acquisition;


·
            Changes
                in interest rates;


·
            Competitive
                developments, including announcements by competitors of new products
                or
                services or significant contracts, acquisitions, strategic partnerships,
                joint ventures or capital
                commitments;


·
            Investor
                perceptions of our company; and


·
            General
                economic and other national and international
                conditions.





Our common
      stock is considered to be a “penny stock” because it does not qualify for one of
      the exemptions from the definition of “penny stock” under Section 3a51-1 of the
      Exchange Act. Our common
      stock may be a “penny stock” if it meets one or more of the following conditions
      (i) the stock trades at a price less than $5.00 per share; (ii) it is NOT traded
      on a “recognized” national exchange; (iii) it is not quoted on the Nasdaq
      Capital Market, or even if so, has a price less than $5.00 per share; or (iv)
      is
      issued by a company that has been in business less than three years with net
      tangible assets less than $5.0 million.




The
      principal result or effect of being designated a “penny stock” is that
      securities broker-dealers participating in sales of our common
      stock will be subject to the “penny stock” regulations set forth in Rules 15-2
      through 15g-9 promulgated under the Exchange Act. For example, Rule 15g-2
      requires broker-dealers dealing in penny stocks to provide potential investors
      with a document disclosing the risks of penny stocks and to obtain a manually
      signed and dated written receipt of the document at least two business days
      before effecting any transaction in a penny stock for the investor’s account.
      Moreover, Rule 15g-9 requires broker-dealers in penny stocks to approve the
      account of any investor for transactions in such stocks before selling any
      penny
      stock to that investor. This procedure requires the broker-dealer to (i) obtain
      from the investor information concerning his or her financial situation,
      investment experience and investment objectives; (ii) reasonably determine,
      based on that information, that transactions in penny stocks are suitable for
      the investor and that the investor has sufficient knowledge and experience
      as to
      be reasonably capable of evaluating the risks of penny stock transactions;
      (iii)
      provide the investor with a written statement setting forth the basis on which
      the broker-dealer made the determination in (ii) above; and (iv) receive a
      signed and dated copy of such statement from the investor, confirming that
      it
      accurately reflects the investor’s financial situation, investment experience
      and investment objectives. Compliance with these requirements may make it more
      difficult and time consuming for holders of our common
      stock to resell their shares to third parties or to otherwise dispose of them
      in
      the market or otherwise.





**Holders
      of our Common Stock**





As
      of
      March 1, 2007, we had 28,327,787
      shares of our common stock issued and outstanding, held by approximately
      69 holders of our common stock.





**Dividend
      Policy**





We
      have
      not declared or paid any cash dividends on our common stock, and we currently
      intend to retain future earnings, if any, to finance the growth of our business,
      and we do not expect to pay any cash dividends in the foreseeable future. The
      decision whether to pay cash dividends on our common stock will be made by
      our
      Board of Directors, in their discretion, and will depend on our financial
      condition, operating results, capital requirements and other factors that the
      Board of Directors considers significant. We currently intend to retain our
      earnings for funding growth and, therefore, do not expect to pay any dividends
      in the foreseeable future.




17




**Equity
      Compensation Plan**





#
                of securities to be issued upon exercise of outstanding options,
                warrants
                and rights
            
            Weighted-average
                exercise price of outstanding options, warrants and rights
            
            #
                of securities remaining available for future issuance under equity
                compensation plans (excluding securities reflected in column
                (a))Equity
                compensation plans approved by security holders
            2,324,165
            
            $1.03
            
            1,925,002Equity
                compensation plans not approved by securities holders
            -
            
            -
            
            -Total
            2,324,165
            
            $1.03
            
            1,925,002





On
      November 30, 2006, the Board of Directors and our shareholders approved the
      2006
      Java Detour, Inc. Equity Incentive Plan (the “Equity Incentive Plan”). The
      Equity Incentive Plan authorizes the issuance of options to purchase shares
      of
      common stock and the grant of stock awards. Administration of the Equity
      Incentive Plan is carried out by our Board of Directors or any committee of
      the
      Board of Directors to which the Board of Directors has delegated all or a
      portion of responsibility for the implementation, interpretation or
      administration of the Equity Incentive Plan. Our employees, officers and
      directors (including employees, officers and directors of our affiliates) are
      eligible to participate in the Equity Incentive Plan. The administrator of
      the
      Equity Incentive Plan will select the participants who are granted stock options
      or stock awards and, consistent with the terms of the Equity Incentive Plan,
      will establish the terms of each stock option or stock award. The maximum period
      in which a stock option may be exercised will be fixed by the administrator.
      Under the Equity Incentive Plan, the maximum number of shares of common stock
      that may be subject to stock options or stock awards is 4,249,167. As of
      December 31, 2006, we have granted an aggregate of 2,324,165 options to our
      directors, officers and employees with 1,925,002 shares of common stock
      available for future issuance. For more information, please see the discussion
      under “Item 10. Equity Compensation.”





**ITEM
      6. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
      OPERATIONS**





The
      following discussion should be read in conjunction with our Financial
      Statements, including the related notes thereto, and other financial information
      included herein. The information in this report includes forward-looking
      statements. Our actual results could differ materially from those set forth
      as a
      result of general economic conditions and changes in the assumptions used in
      making such forward-looking statements. The analysis set forth below is provided
      pursuant to applicable SEC regulations and is not intended to serve as a basis
      for projections of future events.





**Overview**





We
      sell
      high quality gourmet coffees, whole leaf teas, cold blended beverages, fresh
      fruit smoothies and select baked goods primarily from company-owned and
      franchised retail stores. Our immediate goal is to capitalize on the success
      of
      our company-owned stores with a new national franchisee program that will help
      us expand the Java Detour® brand into new domestic and international markets.
      All of our store locations, whether company-owned or franchised, will continue
      to focus on our core business concepts: consistently providing superior quality,
      convenience and customer service to all of our customers. Our main source of
      revenue, our coffee and related retail beverages and food sales, accounted
      for
      more than 98% of our sales for the year ended December 31, 2006.





We
      earn
      revenues mainly from our retail coffee beverage sales and our franchise fees
      and
      royalties. Moving forward, we intend to increase our distribution and
      franchising efforts. We hope to increase profits as a result of increased
      distribution and new store openings and acquisitions, since our retail coffee
      beverage sales and franchising fees are our main source for generating cash.
      We
      intend to devote additional resources to increasing our distribution channels
      and continue to develop additional store locations in order to expand our
      presence and brand recognition.




18




We
      believe that among the primary challenges and risks we face going forward is
      successful implementation of our growth strategy. If we fail to accurately
      predict and meet the needs of our customers in our current and new markets,
      we
      will encounter difficulties maintaining the working capital required to fund
      our
      expansion efforts as well as our efforts to respond to competitive pressures
      within the industry. While we intend to expand our presence internationally,
      there is a certain level of uncertainty surrounding our ability to implement
      such an expansion.





**Recent
      Events**





On
      November 30, 2006, we entered into the Merger Agreement with Merger Sub and
      JDCO, pursuant to which we acquired JDCO in a reverse merger transaction with
      JDCO becoming our wholly-owned subsidiary and our sole business operations
      becoming that of JDCO. We
      also
      changed our corporate name from Media USA.com, Inc.  to
      Java
      Detour, Inc. and reincorporated in the State of Delaware.





Immediately
      prior to the close of the Merger, we closed a $10.0 million private placement
      (the “Private Placement”) of our common stock and warrants. Hunter
      World Markets, Inc. (“Hunter”) acted as the placement agent in connection with
      the Private Placement. Each investor in the Private Placement purchased shares
      of our common stock at $1.00 per share and five-year warrants (the “Investor
      Warrants”) to purchase 25% of the common stock purchased by such investor in the
      Private Placement at a per share exercise price of $2.00 pursuant to the terms
      of a Securities Purchase Agreement entered into by and among Java Detour, JDCO
      and each of the investors. We filed a registration statement covering 9,442,593
      shares of the common stock sold in the Private Placement on December 29, 2006.
      We also agreed to register the remaining shares of the common stock sold in
      the
      Private Placement, the shares underlying the Investor Warrants and
      4,418,403 **** shares
      of
      common stock which are owned by Hunter and its affiliates, which includes the
      shares underlying the Bridge Warrants and Placement Agent Warrants described
      below, in a subsequent registration statement filed by us within the later
      of
      (i) ten business days after June 29, 2006, or (ii) such date later than that
      set
      forth in subparagraph (i) above as directed by Hunter.





The
      shares included in the Private Placement have weighted average anti-dilution
      coverage for the issuance of securities within 12 months of the closing of
      the
      Merger at a price below $1.00, subject to customary exceptions.





As
      compensation for securities sold in the Private Placement, Hunter received
      $1,000,000 as commissions and five-year warrants (the “Placement Agent
      Warrants”) to purchase 2,000,000 shares of our common stock, the terms of such
      warrants being the same as those issued to investors in the Private Placement
      except that the warrants issued to Hunter are exercisable nine months from
      the
      date of issuance and have a cashless exercise feature. As of the closing of
      the
      Merger, Hunter and its affiliates beneficially own 2,418,403 shares of Java
      Detour ,
      Inc.’s
      common stock, which includes (i) 1,125,000 **** shares
      acquired by Hunter prior to the Merger, (ii) 793,403 **** shares
      issued by us at the closing of the Merger for consulting services rendered
      and
      (iii) the Bridge Warrants issued to Hunter further to the Bridge Financing
      (described below) and convertible into 500,000 shares but excludes the Placement
      Agent Warrants convertible into 2,000,000 shares.





Upon
      the
      closing of the Merger, we issued 793,403 shares of our common stock to Hunter
      for consulting services rendered. We accounted for these shares as a
      non-reoccurring general and administrative expense for services rendered and,
      as
      a result, our earnings on a consolidated basis were reduced for the quarter
      and
      year ending December 31, 2006 by the amount of the expenses. The reduction
      in
      earnings was $793,403 which was equal to the fair market value of the shares
      at
      the time of issuance.





**Recapitalization**





Our
      acquisition of JDCO pursuant to the Merger was accounted for as a
      recapitalization by us. The recapitalization was, at the time of the Merger,
      the
      merger of a private operating company (JDCO) into a non-operating public shell
      corporation (us) with nominal net assets and as such is treated as a capital
      transaction, rather than a business combination. As a result no goodwill is
      recorded. The transaction is the equivalent to the issuance of stock by the
      private company for the net monetary assets of the shell corporation. The
      financial statements of JDCO prior to the Merger are treated as the historical
      financial statements of the consolidated companies. The financial statements
      presented will reflect the change in capitalization for all periods presented,
      therefore the capital structure of the consolidated enterprise, being the
      capital structure of the legal parent, is different from that appearing in
      the
      financial statements of JDCO in earlier periods due to the
      recapitalization.




19




**Critical
      Accounting Policies Used in Financial Statements**





The
      discussion and analysis of our financial condition and results of operations
      are
      based upon our consolidated financial statements, which have been prepared
      in
      accordance with generally accepted accounting principles in the United States.
      We believe the following are the critical accounting policies that impact the
      financial statements, some of which are based on management’s best estimates
      available at the time of preparation. Actual results may differ from these
      estimates.





***Intangible
      Assets*** - When
      facts and circumstances indicate that the carrying values of long-lived assets
      may be impaired, an evaluation of recoverability is performed by comparing
      the
      carrying values of the assets to projected future cash flows, in addition to
      other quantitative and qualitative analyses. For intangible assets, impairment
      tests are performed annually and more frequently if facts and circumstances
      indicate that carrying values exceed estimated reporting unit fair values and
      if
      indefinite useful lives are no longer appropriate. Upon indication that the
      carrying values of such assets may not be recoverable, we recognize an
      impairment loss as a charge against current operations. Property, plant and
      equipment assets are grouped at the lowest level for which there are
      identifiable cash flows when assessing impairment. Cash flows for retail assets
      are identified at the individual store level. Long-lived assets to be disposed
      of are reported at the lower of their carrying amount or fair value. Judgments
      made by us related to the expected useful lives of long-lived assets and our
      ability to realize undiscounted cash flows in excess of the carrying amounts
      of
      such assets are affected by factors such as the ongoing maintenance and
      improvements of the assets, changes in economic conditions and changes in
      operating performance. As we assess the ongoing expected cash flows and carrying
      amounts of our long-lived assets, these factors could cause us to realize
      material impairment charges. In
      accordance with SFAS No. 142, *Goodwill
      and Other Intangible Assets* ,
      the
      Company evaluates intangible assets and other long-lived assets for impairment,
      at least on an annual basis and whenever events or changes in circumstances
      indicate that the carrying value may not be recoverable from its estimated
      future cash flows.  Recoverability of intangible assets and other
      long-lived assets is measured by comparing their net book value to the related
      projected undiscounted cash flows from these assets, considering a number of
      factors including past operating results, budgets, economic projections, market
      trends and product development cycles. If the net book value of the asset
      exceeds the related undiscounted cash flows, the asset is considered impaired,
      and a second test is performed to measure the amount of impairment loss.
      Impairment of $80,165 was recorded for the year ended December 31, 2006 related
      to new product formulation and brand re-imaging. No impairment was recorded
      during the year ended December 31, 2005.





***Stock
      Based Compensation*** - We
      adopted SFAS No. 123 (Revised 2004), *Share
      Based Payment* (“SFAS
      No. 123R”), under the modified-prospective transition method on
      January 1, 2006.  SFAS No. 123R requires companies to
      measure and recognize the cost of employee services received in exchange for
      an
      award of equity instruments based on the grant-date fair value. Share-based
      compensation recognized under the modified-prospective transition method of
      SFAS
      No. 123R includes share-based compensation based on the grant-date fair
      value determined in accordance with the original provisions of SFAS
      No. 123, *Accounting
      for Stock-Based Compensation,* for all
      share-based payments granted prior to and not yet vested as of
      January 1, 2006 and share-based compensation based on the grant-date
      fair-value determined in accordance with SFAS No. 123R for all share-based
      payments granted after January 1, 2006. SFAS No. 123R eliminates
      the ability to account for the award of these instruments under the intrinsic
      value method prescribed by Accounting Principles Board (“APB”) Opinion
      No. 25, *Accounting
      for Stock Issued to Employees* ,
      and
      allowed under the original provisions of SFAS No. 123.  Prior to the
      adoption of SFAS No. 123R, we would have accounted for our stock option
      plans using the intrinsic value method in accordance with the provisions of
      APB
      Opinion No. 25 and related interpretations. We account
      for stock-based compensation in accordance with the fair value recognition
      provisions of SFAS 123R. We use the Black-Scholes option pricing model
      which requires the input of highly subjective assumptions. These assumptions
      include estimating the length of time employees will retain their stock options
      before exercising them (“expected term”), the estimated volatility of our common
      stock price over the expected term and the number of options that will
      ultimately not complete their vesting requirements (“forfeitures”). Changes in
      the subjective assumptions can materially affect the estimate of fair value
      of
      stock-based compensation and consequently, the related amount recognized on
      the
      consolidated statements of earnings.




20




**Results
      of Operations**





The
      following table sets forth our statements of operations for the years ended
      December 31, 2006 and 2005 in U.S. dollars:





**Year
                Ended December 31,*****2006***
            
            ***2005******(in
                thousands)***Sales
                and other operating revenues
            
            $
            6,398
            
            $
            6,100Cost
                of sales
            
            
            (1,846
            )
            
            (1,727
            )Gross
                profit
            
            $
            4,552
            
            $
            4,373Store
                expenses
            
            
            3,326
            
            
            2,960Selling,
                general and administrative expenses
            
            
            2,956
            
            
            1,137Depreciation
            
            
            430
            
            
            375Total
                operating expenses
            
            $
            6,712
            
            $
            4,472Income
                (loss) from operations
            
            
            (2,160
            )
            
            (99
            )Other
                income and expensesOther
                income
            
            
            33
            
            
            332Interest
                expense
            
            
            (1,480
            )
            
            (661
            )Registration
                rights expense
            
            
            (150
            )
            
            -Other
                expenses
            
            
            (92
            )
            
            (87
            )Net
                loss before income taxes
            
            
            ($3,849
            )
            
            ($515
            )Income
                tax benefit, net
            
            
            4
            
            
            135Net
                loss
            
            
            ($3,845
            )
            
            ($380
            )





*Comparison
      of the Fiscal Year ended December 31, 2006 to the Year ended December 31,
      2005*





Sales
      and
      other operating revenues for year ended December 31, 2006 were approximately
      $6.4 million, an increase of $0.3 million, or 4.9%, from sales and other
      operating revenues earned of approximately $6.1 million for the year ended
      December 31, 2005. The primary reason for the increase in sales and other
      operating revenues earned was the opening of two new stores in Las Vegas in
      2006
      and the additional sales revenue that they generated.





Cost
      of
      sales for the year ended December 31, 2006 was approximately $1.8 million,
      an
      increase of $0.1 million, or 6.9%, from approximately $1.7 million for the
      year
      ended December 31, 2005. The increase in cost of sales was primarily due to
      increased sales volume resulting from the opening of our two new Las Vegas
      stores. Cost of sales as a percentage of net sales for the year ended December
      31, 2006 was approximately 28.9%, which was an increase from 28.3% for the
      year
      ended December 31, 2005.





Gross
      profit for the year ended December 31, 2006 was approximately $4.6 million,
      an
      increase of $0.2 million, or 4.1%, from $4.4 million for the year ended December
      31, 2005. The increase in gross profit was primarily due to the fact that sales
      and other operating revenues earned due to the opening of two new stores
      increased more than cost of sales increased proportionally due to the opening
      of
      such new stores. Our gross margin for the year ended December 31, 2006 was
      71.1%
      as compared with 71.7% for the year ended December 31, 2005.




21




Store
      expenses were approximately $3.3 million for the year ended December 31, 2006,
      an increase of $0.3 million, or 12.4%, from approximately $3.0 million for
      the
      year ended December 31, 2005. The increase was primarily due to the opening
      of
      our two new Las Vegas stores.





Selling
      and general administrative expenses were approximately $3.0 million for the
      year
      ended December 31, 2006, an increase of approximately $1.8 million , or 160%,
      from approximately $1.1 million for the year ended December 31, 2005. The
      increase was primarily due to an increase of approximately $1.5 million in
      legal
      and professional fees incurred in connection with the Merger and Private
      Placement, an increase of approximately $0.1 million in salaries and wages
      due
      to additional staffing required to support our national franchise roll-out
      and
      an increase of approximately $0.1 million in marketing expenses incurred to
      promote the Java Detour® brand throughout California and Nevada.





Depreciation
      expenses for the year ended December 31, 2006 was approximately $430,000 as
      compared to approximately $375,000 for the year ended December 31, 2005. The
      increase of $55,000, or 14.7%, was primarily due to assets purchased relating
      to
      our two new Las Vegas store openings.





Other
      income was approximately $33,000 for the year ended December 31, 2006 as
      compared with approximately $332,000 of other income for the year ended December
      31, 2005. The decrease of $299,000 in 2006 was primarily due to the sale of
      a
      company-owned store in Bakersfield, CA that accounted for $302,000 of additional
      other income in 2005.





Interest
      expenses for the year ended December 31, 2006 was approximately $1.5 million,
      an
      increase of $0.8 million or 123.9%, from approximately $0.7 million for the
      year
      ended December 31, 2005. The increase was primarily due to additional borrowings
      of approximately $0.2 million and Bridge Financing (described below) fees of
      approximately $0.6 million, which were required to complete the Merger and
      register the securities sold in the Private Placement.





Net
      loss
      for the year ended December 31, 2006 was approximately $3.8 million , an
      increase of approximately $3.4 million , or 911.8%, from $0.4 million for the
      year ended December 31, 2005 for the reasons stated above.





**Liquidity
      and Capital Resources**





At
      December 31, 2006, we had total **** equity
      of
      approximately $7.8 million and had cash and cash equivalents of approximately
      $4.9 million. Prior to November 2006, we have historically financed our business
      through long-term bank loans and lines of credit and cash provided by
      operations.





From
      September 2002 through 2004, we borrowed funds through convertible secured
      promissory notes in the aggregate principal amount of $1,525,000, bearing
      interest at a rate of 12% per annum and due and payable on December 31, 2007
      (the “Convertible Notes”).





In
      January 2006, we borrowed the aggregate principal amount of $350,000 from First
      Street Ventures, with interest accruing at a rate of 8% per annum. In October
      2006, First Street Ventures entered into a Note Conversion Agreement with JDCO,
      whereby First Street Ventures agreed to accept 51,775 shares of JDCO’s common
      stock as partial satisfaction of JDCO’s obligations under the loan from First
      Street Ventures, thereby reducing the principal amount outstanding under the
      First Street loan to $175,000. Immediately after the closing of the Merger,
      we
      paid the principal amount of $175,000 still outstanding under the loan to First
      Street Ventures.





From
      time
      to time, we borrowed funds through several promissory notes in the aggregate
      principal amount of approximately $630,000 **** (the
      “Promissory Notes”), $400,000 of which was converted into 118,342 shares of JDCO
      common stock immediately prior to the closing of the Merger. We paid the
      remaining aggregate principal amount of $230,000 still outstanding under the
      Promissory Notes immediately after the closing of the Merger.





Pursuant
      to a business loan agreement dated September 19, 2006 and maturing on July
      1,
      2007, Summit Bank extended a line of credit in the principal amount of
      $1,500,000, guaranteed by Michael Binninger, Steven Binninger, Paul F. Klapper
      and the Klapper Family Trust, each shareholders of our company. Concurrent
      with
      the closing of the Merger using proceeds of the Private Placement, we paid
      off
      the Summit line of credit as well as a line of credit with Wells Fargo Bank,
      N.A. in the amount of $99,300 and a line of credit with American Express in
      the
      amount of $26,500.




22




On
      August
      30, 2006, JDCO executed a Term Credit Agreement with The Hunter Fund Limited,
      an
      affiliated entity of Hunter, the placement agent in connection with the Private
      Placement described below, for a $500,000 term loan (the “Bridge Financing”).
      Immediately after the closing of the Merger and using proceeds from the Private
      Placement, we paid off the Bridge Financing in addition to paying the Hunter
      Fund a bridge loan fee of $60,000 and a flat interest payment of $50,000.





In
      November 2006, we received gross proceeds of $10.0 million in a private
      placement transaction (the “Private Placement”). Each investor in the Private
      Placement purchased shares of our common stock and five-year warrants to
      purchase 25% of the common stock purchased by such investor in the Private
      Placement. For its services as placement agent, Hunter received a fee equal
      to
      10% of the funds placed in the Private Placement. Hunter also received, for
      nominal consideration, five-year warrants to purchase 2,000,000 shares of our
      common stock, exercisable nine months from the date of issuance at the same
      share price of the shares sold in the Private Placement. We also incurred legal
      and accounting expenses of approximately $270,000. After commission and
      expenses, we received net proceeds of approximately $8.75 million.





Net
      cash
      used in operating activities for the year ended December 31, 2006 was
      approximately $1.0 million, as compared to approximately $0.5 million used
      during the year ended 2005. The change is primarily the result of operating
      losses resulting from administrative and interest charges incurred in connection
      with the Private Placement and the issuance of common stock.





Net
      cash
      used by investing activities was approximately $0.8 million for the year ended
      December 31, 2006, as compared to net cash used of approximately $0.3 million
      for the year ended December 31, 2005. The increase in cash used was primarily
      a
      result of the purchase of assets related to the opening of our two new Las
      Vegas
      store locations.





Net
      cash
      provided by financing activities was approximately $6.6 million for the year
      ended December 31, 2006, as compared to cash provided in the amount of
      approximately $0.8 million for the year ended December 31, 2005. The increase
      in
      cash provided was primarily due net proceeds of approximately $9.0 million
      from
      the Private Placement and $1.1 million in proceeds from notes payable offset
      by
      $3.3 million of principal payments of outstanding notes payable.





Our
      capital requirements, including development costs related to the opening of
      additional retail locations and expansion of our franchise retail operations,
      have been, and will continue to be significant. Our future capital requirements
      and the adequacy of available funds will depend on many factors, including
      the
      pace of our expansion, real estate markets, the availability of suitable site
      locations and the nature of the arrangements negotiated with landlords. During
      2007, we intend to expend approximately $0.7 million to continue to
      strategically expand our retail operations while also creating other outlets
      and
      distribution points for sales of our products. We believe that our current
      liquidity and resources will provide sufficient liquidity to fund our operations
      for at least 12 months.





**Off-Balance
      Sheet Arrangements**





None.





**Change
      In Accountants**





As
      previously reported on our Current Report on Form 8-K, dated December 8, 2006
      effective as of November 30, 2006 concurrent with the closing of the Merger,
      the
      Board of Directors accepted the resignation of Spector & Wong, the
      independent registered public accounting firm for MediaUSA, and approved the
      engagement of AJ.
      Robbins, PC as our
      independent registered public accounting firm.





**New
      Accounting Pronouncements**




23




We
      have
      adopted all accounting pronouncements effective before December 31, 2006,
      which are applicable to us.





In
      June 2006, the Emerging Issues Task Force issued EITF No.06-3, *How
      Taxes Collected from Customers and Remitted to Governmental Authorities Should
      Be Presented in the Income Statement (That Is, Gross versus Net
      Presentation)* ,
      which
      clarifies diversity in practice on the presentation of different types of taxes
      in the financial statements. The EITF concluded that, for taxes within the
      scope
      of the issue, a company may adopt a policy of presenting taxes either gross
      within revenue or net. That is, it may include charges to customers for taxes
      within revenues and the charge for the taxes from the taxing authority within
      cost of sales, or, alternatively, it may net the charge to the customer and
      the
      charge from the taxing authority. If taxes subject to this issue are
      significant, a company is required to disclose its accounting policy for
      presenting taxes and the amounts of such taxes that are recognized on a gross
      basis. The guidance in this consensus is effective for the first interim
      reporting period beginning after December 15, 2006. We are currently
      assessing the impact, if any, that the adoption of EITF No.06-03 will have
      on
      our financial statements.








In
      July 2006, the Financial Accounting Standards Board (FASB) issued FASB
      Interpretation No. 48, *Accounting
      for Uncertainty in Income Taxes—An Interpretation of FASB Statement
      No. 109* ,
      which
      became effective for us on January 1, 2007. This interpretation clarifies
      the accounting for income tax benefits that are uncertain in nature. Under
      FASB
      No. 48, a company will recognize a tax benefit in the financial statements
      for an uncertain tax position only if management’s assessment is that its
      position is “more likely than not” (i.e., a greater than 50 percent
      likelihood) to be upheld on audit based only on the technical merits of the
      tax
      position. This accounting interpretation also provides guidance on measurement
      methodology, derecognition thresholds, financial statement classification and
      disclosures, interest and penalties recognition, and accounting for the
      cumulative-effect adjustment. The new interpretation is intended to provide
      better financial statement comparability among companies.




Required
      annual disclosures include a tabular reconciliation of unrecognized tax benefits
      at the beginning and end of the period; the amount of unrecognized tax benefits
      that, if recognized, would affect the effective tax rate; the amounts of
      interest and penalties recognized in the financial statements; any expected
      significant impacts from unrecognized tax benefits on the financial statements
      over the subsequent 12-month reporting period; and a description of the tax
      years remaining to be examined in major tax jurisdictions. FASB No. 48 is
      effective for fiscal years beginning on or after December 15, 2006. We are
      currently assessing the impact, if any, that the adoption of FIN No. 48
      will have on our financial statements.




In
      September 2006, the SEC issued Staff Accounting Bulletin (SAB) No. 108, *Considering
      the Effects of Prior Year Misstatements when Quantifying Misstatements in
      Current Year Financial Statements* .
      SAB No.
      108 was issued in order to eliminate the diversity in practice surrounding
      how
      public companies quantify financial statement misstatements. SAB No. 108
      requires that registrants quantify errors using both a balance sheet (iron
      curtain) approach and an income statement (rollover) approach then evaluate
      whether either approach results in a misstated amount that, when all relevant
      quantitative and qualitative factors are considered, is material. SAB No. 108
      is
      effective for fiscal years ending after November 15, 2006. We adopted SAB No.
      108 during 2006. The adoption did not have a material effect on our consolidated
      results of our operations, financial position, or cash flows.





In
      September 2006, the FASB issued SFAS No. 157, *Fair
      Value Measurements.* This
      statement clarifies the definition of fair value, establishes a framework for
      measuring fair value and expands the disclosures on fair value measurements.
      SFAS No. 157 is effective for fiscal years beginning after
      November 15, 2007. We have not determined the effect, if any; the adoption
      of this statement will have on our financial statements.





In
      September 2006, the FASB issued SFAS No. 158, *Employers'
      Accounting for Defined Benefit Pension and Other Postretirement Plans − An
      amendment of FASB Statements No. 87, 88, 106, and 132(R)* .
      One
      objective of this standard is to make it easier for investors, employees,
      retirees and other parties to understand and assess an employer's financial
      position and its ability to fulfill the obligations under its benefit plans.
      SFAS No. 158 requires employers to fully recognize in their financial statements
      the obligations associated with single−employer defined benefit pension plans,
      retiree healthcare plans, and other postretirement plans. SFAS No. 158 requires
      an employer to fully recognize in its statement of financial position the over
      funded or under funded status of a defined benefit postretirement plan (other
      than a multiemployer plan) as an asset or liability and to recognize changes
      in
      that funded status in the year in which the changes occur through comprehensive
      income. This statement also requires an employer to measure the funded status
      of
      a plan as of the date of its year-end statement of financial position, with
      limited exceptions. SFAS No. 158 requires an entity to recognize as a component
      of other comprehensive income, net of tax, the gains or losses and prior service
      costs or credits that arise during the period but are not recognized as
      components of net periodic benefit cost pursuant to SFAS No. 87. This statement
      requires an entity to disclose in the notes to financial statements additional
      information about certain effects on net periodic benefit cost for the next
      fiscal year that arise from delayed recognition of the gains or losses, prior
      service costs or credits, and transition asset or obligation. We are required
      to
      initially recognize the funded status of a defined benefit postretirement plan
      and to provide the required disclosures for fiscal years ending after December
      15, 2006. We believe that this statement will not have a significant impact
      on
      the financial statements. ****




24




In
      December 2006, the FASB issued FSP EITF 00-19-2, *Accounting
      for Registration Payment Arrangements* .
      This
      FASB Staff Position (FSP) addresses an issuer’s accounting for registration
      payment arrangements. This FSP specifies that the contingent obligation to
      make
      future payments or otherwise transfer consideration under a registration payment
      arrangement, whether issued as a separate agreement or included as a provision
      of a financial instrument or other agreement, should be separately recognized
      and measured in accordance with FASB Statement No. 5, *Accounting
      for Contingencies* .
      The
      guidance in this FSP amends FASB Statements No. 133, *Accounting
      for Derivative Instruments and Hedging Activities* ,
      and No.
      150, *Accounting
      for Certain Financial Instruments with Characteristics of both Liabilities
      and
      Equity* ,
      and
      FASB Interpretation No. 45, *Guarantor’s
      Accounting and Disclosure Requirements for Guarantees, Including Indirect
      Guarantees of Indebtedness of Others* ,
      to
      include scope exceptions for registration payment arrangements. This FSP further
      clarifies that a financial instrument subject to a registration payment
      arrangement should be accounted for in accordance with other applicable
      generally accepted accounting principles (GAAP) without regard to the contingent
      obligation to transfer consideration pursuant to the registration payment
      arrangement. This
      FSP
      is effective immediately for registration payment arrangements and the financial
      instruments subject to those arrangements that are entered into or modified
      subsequent to the date of issuance of this FSP. For registration payment
      arrangements and financial instruments subject to those arrangements that were
      entered into prior to the issuance of this FSP, this guidance shall be effective
      for financial statements issued for fiscal years beginning after December 15,
      2006, and interim periods within those fiscal years. Early adoption of this
      FSP
      for interim or annual periods for which financial statements or interim reports
      have not been issued is permitted. We have chosen to adopt this FSP early. See
      Note
      12 in the Notes to Audited Consolidated Financial Statements beginning on page
      F-8 for the effect of the adoption of this FSP.





**Seasonality**





Historically,
      sales in the gourmet coffee industry has experienced variations in sales from
      quarter-to-quarter due to the temperature changes in specific geographic areas
      ,
      as well as from a variety of other factors, including, but not limited to,
      general economic trends, the cost of green coffee, competition, marketing
      programs, weather and special or unusual events. ****





**ITEM
      7. FINANCIAL STATEMENTS**





The
      information required by this Item 7 is incorporated by reference to the Index
      to
      Consolidated Financial Statements beginning at page F-1 of this Annual
      Report.





25


**JAVA
      DETOUR, INC.**


**INDEX
      TO FINANCIAL STATEMENTS**




Page**REPORT
                OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**
            F-2**CONSOLIDATED
                FINANCIAL STATEMENTS**Consolidated
                Balance Sheet as of December 31, 2006
            F-3Consolidated
                Statements of Operations for the years ended December 31, 2006 and
                2005
            F-4Consolidated
                Statements of Changes in Stockholders' Equity (Deficit) for the years
                ended December 31, 2006 and 2005
            F-5Consolidated
                Statements of Cash Flows for the years ended December 31, 2006 and
                2005
            F-6Notes
                to Consolidated Financial Statements
            F-7





F-1


**AJ.
      ROBBINS, P.C.**




**Certified
      Public Accountants**




**216
      Sixteenth Street**




**Suite
      600**




**Denver,
      Colorado 80202**




**Report
      of Independent Registered Public Accounting Firm**







To
      The
      Board of Directors and Stockholders of


Java
      Detour, Inc.


Davis,
      California





We
      have
      audited the accompanying consolidated balance sheet of Java Detour, Inc. and
      Subsidiaries as of December 31, 2006, and the related consolidated
      statements of operations, changes in stockholders’ equity (deficit) and
      cash flows for each of the years in the two year period then ended. These
      consolidated financial statements are the responsibility of the Company’s
      management.  Our responsibility is to express an opinion on these
      consolidated financial statements based on our audits.




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




In
      our
      opinion, the consolidated financial statements referred to above present fairly,
      in all material respects, the consolidated financial position of Java Detour,
      Inc. and Subsidiaries as of December 31, 2006, and the consolidated
      results of their operations and consolidated cash flows for each of the years
      in
      the two year period then ended, in conformity with accounting principles
      generally accepted in the United States of America.




*/s/
      AJ. Robbins PC.*





**AJ.
      Robbins PC**


**Certified
      Public Accountants**





Denver,
      Colorado


February
      9, 2007




F-2


**JAVA
      DETOUR, INC. AND SUBSIDIARIES**


**CONSOLIDATED
      BALANCE SHEET**


**DECEMBER
      31, 2006**











**ASSETS****CURRENT
                ASSETS:**Cash
                and cash equivalents
            
            $
            4,938,149Accounts
                receivable, net
            
            
            53,568Current
                portion of notes receivable
            
            
            43,641Inventories
            
            
            68,961Prepaid
                expenses
            
            
            55,990Total
                current assets
            
            
            5,160,309**NONCURRENT
                ASSETS:**Notes
                receivable, net of current portion
            
            
            400,830Property
                and equipment, net
            
            
            5,124,783Intangibles
            
            
            5,600Prepaid
                expenses
            
            
            12,318Deferred
                tax assets
            
            
            485,647Other
                assets
            
            
            57,855**TOTAL
                ASSETS**
            
            $
            11,247,342**LIABILITIES
                AND STOCKHOLDERS’ EQUITY****CURRENT
                LIABILITIES:**Accounts
                payable
            
            $
            354,733Accounts
                payable, related party
            
            
            35,444Deferred
                revenue
            
            
            375,000Notes
                payable
            
            
            48,007Capital
                lease obligations
            
            
            236,393Contingent
                liability for registration rights agreement
            
            
            150,000Accrued
                expenses and other current liabilities
            
            
            319,871Total
                current liabilities
            
            
            1,519,448Notes
                payable, net of current portion
            
            
            933,138Capitalized
                leases obligations, net of current portion
            
            
            767,637Deferred
                rent
            
            
            240,520Total
                liabilities
            
            
            3,460,743**COMMITMENTS
                AND CONTINGENCIES****STOCKHOLDERS’
                EQUITY:**Preferred
                stock, $0.001 par value; 5,000,000 shares authorized; 0Shares
                issued and outstanding
            
            
            -Common
                stock, $0.001 par value; 75,000,000 shares authorized;28,327,787
                shares issued and outstanding
            
            
            28,328Additional
                paid in capital
            
            
            14,306,474Accumulated
                deficit
            
            
            (6,548,203
            )Total
                stockholders’ equity
            
            
            7,786,599**TOTAL
                LIABILITIES AND STOCKHOLDERS’ EQUITY**
            
            $
            11,247,342




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




F-3




**JAVA
      DETOUR, INC. AND SUBSIDIARIES**


**CONSOLIDATED
      STATEMENTS OF OPERATIONS**


**YEARS
      ENDED DECEMBER 31, 2006 AND 2005**





**2006**
            
            **2005****OPERATING
                REVENUES:**Sales
                and other operating revenues, net
            
            $
            6,398,090
            
            $
            6,100,095Cost
                of sales
            
            
            (1,846,176
            )
            
            (1,726,677
            )Gross
                profit
            
            
            4,551,914
            
            
            4,373,418**OPERATING
                EXPENSES:**Store
                operating expenses:
            
            
            3,325,827
            
            
            2,960,388Selling,
                general and administrative expenses
            
            
            2,955,967
            
            
            1,136,506Depreciation
            
            
            430,193
            
            
            374,792Total
                operating expenses
            
            
            6,711,987
            
            
            4,471,686**INCOME
                (LOSS) FROM OPERATIONS**
            
            
            (2,160,073
            )
            
            (98,268
            )**OTHER
                INCOME/(EXPENSE):**Other
                income
            
            
            33,284
            
            
            332,344Interest
                expense
            
            
            (1,480,247
            )
            
            (660,732
            )Loss
                on registration rights agreement
            
            
            (150,000
            )
            
            -Other
                expenses
            
            
            (92,127
            )
            
            (86,744
            )Total
                other income/(expense)
            
            
            (1,689,090
            )
            
            (415,132
            )**NET
                (LOSS) BEFORE INCOME TAXES**
            
            
            (3,849,163
            )
            
            (513,400
            )**INCOME
                TAX BENEFIT**
            
            
            3,996
            
            
            135,212**NET
                (LOSS)**
            
            $
            (3,845,167
            )
            $
            (378,188
            )**PREFERRED
                STOCK DIVIDENDS**
            
            
            (54,923
            )
            
            (59,916
            )**NET
                LOSS ATTIBUTED TO COMMON****STOCKHOLDERS**
            
            $
            (3,900,090
            )
            $
            (438,104
            )**NET
                (LOSS) PER SHARE:****BASIC
                AND DILUTED**
            
            $
            (0.31
            )
            $
            (0.04
            )**WEIGHTED
                AVERAGE SHARES****OUTSTANDING:****BASIC
                AND DILUTED**
            
            
            12,405,530
            
            
            10,808,785





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




F-4




**JAVA
      DETOUR, INC. AND SUBSIDIARIES**


**CONSOLIDATED
      STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT)**


**FOR
      THE YEARS ENDED DECEMBER 31, 2006 AND 2005**




**Preferred
                Stock**
            
            
            
            **Additional****Series
                A**
            
            **Common
                Stock**
            
            **Paid
                in**
            
            **Accumulated****Shares**
            
            **Amount**
            
            **Shares**
            
            **Amount**
            
            **Capital**
            
            **(Deficit)**
            
            **Total****Balance
                December 31, 2004**
            
            
            **295,454**
            
            
            **296**
            
            
            **10,697,171**
            
            
            **10,697**
            
            
            **1,265,195**
            
            
            **(2,210,009**
            **)**
            
            **(933,821**
            **)**Sale
                of common stock
            
            
            
            
            
            
            
            
            178,289
            
            
            178
            
            
            99,822
            
            
            
            
            
            100,000Declaration
                of preferred dividends
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            (59,916
            )
            
            (59,916
            )Amortization
                of warrants granted with preferred stock
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            14,839
            
            
            
            
            
            14,839Net
                loss for the year
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            (378,188
            )
            
            (378,188
            )**Balance,
                December 31, 2005**
            
            
            **295,454**
            
            
            **296**
            
            
            **10,875,460**
            
            
            **10,875**
            
            
            **1,379,856**
            
            
            **(2,648,113**
            **)**
            
            **(1,257,086**
            **)**Declaration
                of preferred dividends
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            (54,923
            )
            
            (54,923
            )Amortization
                of warrants granted with preferred stock
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            40,807
            
            
            
            
            
            40,807Conversion
                of Series A Preferred shares
            
            
            (295,454)
            )
            
            (296
            )
            
            1,062,125
            
            
            1,062
            
            
            (766
            )
            
            
            
            
            -Conversion
                of Series A Preferred - warrants and dividends
            
            
            
            
            
            
            
            
            279,078
            
            
            279
            
            
            173,067
            
            
            
            
            
            173,346Conversion
                of convertible notes and accrued interest
            
            
            
            
            
            
            
            
            3,281,781
            
            
            3,282
            
            
            1,926,505
            
            
            
            
            
            1,929,787Conversion
                of notes payable
            
            
            
            
            
            
            
            
            501,586
            
            
            502
            
            
            571,813
            
            
            
            
            
            572,315Sale
                of common stock, net of offering costs of $1,050,000
            
            
            
            
            
            
            
            
            10,000,000
            
            
            10,000
            
            
            8,940,000
            
            
            
            
            
            8,950,000Effect
                of reverse merger
            
            
            
            
            
            
            
            
            1,534,345
            
            
            1,534
            
            
            (1,534
            )
            
            
            
            
            -Common
                stock issued for services
            
            
            
            
            
            
            
            
            793,412
            
            
            794
            
            
            792,608
            
            
            
            
            
            793,402Warrants
                granted for bridge loan
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            450,499
            
            
            
            
            
            450,499Fair
                value of employee stock options
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            33,619
            
            
            
            
            
            33,619Net
                loss for the year
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            (3,845,167
            )
            
            (3,845,167
            )**Balance,
                December 31, 2006**
            
            
            **-**
            
            
            **-**
            
            
            **28,327,787**
            
            
            **28,328**
            
            
            **14,306,474**
            
            
            **(6,548,203**
            **)**
            
            **7,786,599**




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




F-5




**JAVA
      DETOUR, INC. AND SUBSIDIARIES**


**CONSOLIDATED
      STATEMENTS OF CASH FLOWS**


**YEARS
      ENDED DECEMBER 31, 2006 AND 2005**


**CASH
                FLOWS (TO) FROM OPERATING ACTIVITIES:**
            
            **2006**
            
            **2005**Net
                income/(loss)
            
            $
            (3,845,167)
            
            $
            (378,188
            )Adjustments
                to reconcile net (loss) to net cash (used in) operating
                activities:Depreciation
            
            
            430,193
            
            
            374,792Loss
                (gain) on disposal of fixed assets
            
            
            76,565
            
            
            (226,519
            )Impairment
                of intangible assets
            
            
            80,165
            
            
            -Amortization
                of beneficial conversion feature
            
            
            39,607
            
            
            19,804Value
                of stock issued for services
            
            
            793,402
            
            
            -Value
                of stock issued as repayment of accrued interest
            
            
            19,181
            
            
            -Value
                of warrants granted for loan fees
            
            
            450,499
            
            
            -Value
                of options granted to employees
            
            
            33,619
            
            
            -Amortization
                of fair value of warrants granted in connection with issuance of
                preferred
                stock
            
            
            40,807
            
            
            14,839Changes
                in operating assets & liabilitiesAccounts
                receivable
            
            
            8,024
            
            
            (47,930
            )Inventories
            
            
            (15,408)
            
            
            (5,022
            )Deferred
                franchise costs
            
            
            150,655
            
            
            81,777Prepaid
                expenses
            
            
            (33,683)
            
            
            (16,677
            )Deferred
                tax assets
            
            
            (3,996)
            
            
            (136,812
            )Other
                assets
            
            
            12,497
            
            
            42,623Accounts
                payable
            
            
            (50,353)
            
            
            (309,813
            )Accounts
                payable related party
            
            
            35,444
            
            
            -Deferred
                revenue
            
            
            357,000
            
            
            (9,000
            )Accrued
                expenses and other current liabilities
            
            
            250,025
            
            
            41,054Contingent
                liability
            
            
            150,000
            
            
            -Deferred
                rent
            
            
            62,494
            
            
            64,349**NET
                CASH (USED IN) OPERATING ACTIVITIES**
            
            
            (958,430)
            
            
            (490,723
            )**CASH
                FLOW FROM (TO) INVESTING ACTIVITIES**Purchase
                of property and equipment
            
            
            (839,326)
            
            
            (269,609
            )Issuance
                of notes receivable
            
            
            -
            
            
            (6,250
            )Payments
                received on notes receivable
            
            
            7,101
            
            
            5,046Intangible
                assets
            
            
            (5,600)
            
            
            -**NET
                CASH (USED IN) INVESTING ACTIVITIES**
            
            
            (837,825)
            
            
            (270,813)**CASH
                FLOWS FROM (TO) FINANCING ACTIVITIES**Advances
                to shareholders
            
            
            (62,751)
            
            
            (42,332
            )Proceeds
                from notes payable
            
            
            525,990
            
            
            -Principal
                repayments of notes payable
            
            
            (541,167)
            
            
            (50,122
            )Principal
                repayments of capital lease obligations
            
            
            (187,585)
            
            
            (111,992
            )Proceeds
                from lines of credit
            
            
            -
            
            
            944,647Principal
                repayments of lines of credit
            
            
            (1,630,026)
            
            
            (3,099
            )Proceeds
                from related party notes payable
            
            
            530,000
            
            
            131,107Principal
                repayments of related party notes payable
            
            
            (964,537)
            
            
            (460,239
            )Proceeds
                from related party convertible notes payable
            
            
            -
            
            
            300,000Preferred
                dividends paid
            
            
            (9,986)
            
            
            -Proceeds
                from issuance of common stock
            
            
            10,000,000
            
            
            100,000Payment
                of offering costs
            
            
            (1,050,000)
            
            
            -**NET
                CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES**
            
            
            6,609,938
            
            
            807,970**NET
                INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS**
            
            
            4,813,683
            
            
            46,434Cash
                and cash equivalents, at beginning of period
            
            
            124,466
            
            
            78,032**CASH
                AND CASH EQUIVALENTS, AT END OF PERIOD**
            
            $
            4,938,149
            
            $
            124,466**NONCASH
                INVESTING AND FINANCING ACTIVITY:**Acquisition
                of property and equipment under capital leases
            
            $
            473,005
            
            $
            144,780Acquisition
                of property and equipment through contribution by
                stockholders
            
            
            201,900Repayment
                of convertible notes in exchange for common stock
            
            $
            1,355,000Repayment
                of related party notes in exchange for common stock
            
            $
            550,050Repayment
                of related party convertible notes in exchange for common
                stock
            
            $
            470,000Repayment
                of accrued interest and finance charges in exchange for common
                stock
            
            $
            127,121Preferred
                stock dividends in exchange for common stock
            
            $
            173,347
            
            $
            451,572**SUPPLEMENTAL
                DISCLOSURE OF CASH FLOW INFORMATION:**Cash
                paid for interest
            
            $
            687,004
            
            $
            578,955Cash
                paid for income taxes
            
            $
            1,600
            
            $
            1,600


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




F-6




**JAVA
        DETOUR, INC. AND SUBSIDIARIES**
 **NOTES
        TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS**
 **DECEMBER
        31, 2006 AND 2005**




**NOTE
      1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING
      POLICIES**





Java
      Detour, Inc. (formerly known as Media USA.com, Inc. and referred to herein as the “Company”
or “ Java
      Detour ”)
      operates through its wholly-owned subsidiary JDCO, Inc., a California
      corporation (“JDCO”). The Company sells high-quality gourmet coffees, whole leaf
      teas, cold-blended beverages, fresh fruit smoothies and select baked goods
      to
      its customers from uniquely designed retail stores specialized in providing
      fast
      and convenience customer service. Java Detour, a California corporation (“JDCO
      Subsidiary”) and a wholly owned subsidiary of JDCO, is a franchisor of Java
      Detour cafés, with four franchised outlets in the north central United States.
      As of December 31, 2006, there were 14 company-owned stores and 4 franchised
      stores.





On
      November 30, 2006, Java Detour, its wholly-owned subsidiary Java Acquisition
      Co., Inc. (“Merger Sub”) and JDCO entered into an Agreement and Plan of Merger
      (the “Merger Agreement”) pursuant to which JDCO would be acquired by Java Detour
      in a reverse merger transaction wherein Merger Sub would merge with and into
      JDCO, with JDCO being the surviving corporation, and the shareholders of JDCO
      would exchange their shares of JDCO common stock for shares of Java Detour
      common stock (the “Merger”) on a 2.962 for 1 basis. On November 30, 2006, the
      Merger closed and JDCO became a wholly−owned subsidiary of the Company. The
      Company changed its name from Media USA.com, Inc. to Java Detour, Inc. and
      reincorporated in the state of Delaware pursuant
      to an 8-for-1 stock split. All references to common stock shares and per share
      amounts have been retroactively restated to reflect the share exchange as if
      the
      exchange had taken place as of the beginning of the earliest period
      presented.





**Principles
      of Consolidation**


The
      financial statements reflect the consolidation of JDCO and JDCO Subsidiary,
      wholly-owned subsidiaries of Java Detour, and all material intercompany
      transactions have been eliminated.





**Stock
      Based Compensation**


The
      Company adopted SFAS No. 123 (Revised 2004), *Share
      Based Payment* (“SFAS
      No. 123R”), under the modified-prospective transition method on
      January 1, 2006.  SFAS No. 123R requires companies to
      measure and recognize the cost of employee services received in exchange for
      an
      award of equity instruments based on the grant-date fair value. Share-based
      compensation recognized under the modified-prospective transition method of
      SFAS
      No. 123R includes share-based compensation based on the grant-date fair
      value determined in accordance with the original provisions of SFAS
      No. 123, *Accounting
      for Stock-Based Compensation,* for all
      share-based payments granted prior to and not yet vested as of
      January 1, 2006 and share-based compensation based on the grant-date
      fair-value determined in accordance with SFAS No. 123R for all share-based
      payments granted after January 1, 2006. SFAS No. 123R eliminates
      the ability to account for the award of these instruments under the intrinsic
      value method prescribed by Accounting Principles Board (“APB”) Opinion
      No. 25, *Accounting
      for Stock Issued to Employees* ,
      and
      allowed under the original provisions of SFAS No. 123.  Prior to the
      adoption of SFAS No. 123R, the Company would have accounted for its stock
      option plans using the intrinsic value method in accordance with the provisions
      of APB Opinion No. 25 and related interpretations.





**Reclassifications**


Certain
      prior year amounts have been reclassified to conform with the current year’s
      presentation, none of which had an impact on total assets, stockholders’ equity
      (deficit), net loss, or net loss per share.





**Fair
      Value of Financial Instruments**


The
      carrying value of cash, accounts receivable, deferred revenue, accounts payable,
      and accrued expenses approximate fair value because of the short maturity of
      these items.




**Cash
      and Cash Equivalents**


For
      purposes of the statement of cash flows, the Company considers all highly-liquid
      instruments purchased with a remaining maturity of three months or less to
      be
      cash equivalents.




F-7


**JAVA
        DETOUR, INC. AND SUBSIDIARIES**
 **NOTES
        TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS**
 **DECEMBER
        31, 2006 AND 2005**




**Concentrations**


The
      Company maintains its cash in bank deposit accounts that, at times, may exceed
      federally insured limits. The Company has not experienced any losses in such
      accounts. Management believes the Company is not exposed to any significant
      credit risk related to cash.





The
      Company primarily operates its stores in California and Nevada and generated
      approximately 91.4% of its revenues in California in the year ended December
      31,
      2006.





**Accounts
      Receivable**


Accounts
      receivable are stated at amounts due from customers or individuals net of an
      allowance for doubtful accounts. Accounts longer than the contractual payment
      terms are considered past due.





**Allowance
      for Doubtful Accounts**


The
      Company maintains an allowance for doubtful accounts resulting from the
      inability, failure or refusal of customers to make required payments.  The
      Company determines the adequacy of this allowance by regularly reviewing the
      accounts receivable aging and applying various expected loss percentages to
      certain accounts receivable categories based upon historical bad debt
      experience. At December 31, 2006 the allowance for doubtful accounts balance
      was
      $0.








**Due
      from Stockholders**


Prior
      to
      becoming a reporting company with the United States Securities and Exchange
      Commission (“SEC”), the Company made advances to certain of the Company's
      original stockholders. These advances were non-interest bearing and payable
      upon
      the demand of the Company. The stockholders have repaid these advances during
      2006 by applying payroll owed to them in the amount of $56,972 and by paying
      for
      and contributing leasehold improvements into newly constructed Java Detour
      store
      locations in the amount of $201,900.





**Notes
      Receivable**


Notes
      receivable are stated at amounts due from an individual that acquired the assets
      of a store. The Company routinely evaluates the collectability of the notes
      to
      determine if there is any risk of default.





**Deferred
      Offering Costs**


Deferred
      offering costs, consisting of legal and filing fees relating to future offerings
      will be capitalized. The deferred offering costs will be offset against offering
      proceeds in the event the offering is successful. In the event the offering
      is
      unsuccessful or is abandoned, the deferred offering costs will be expensed.
      Costs associated with debt offerings will be capitalized and amortized over
      the
      terms of the debt. If the debt is repaid before it is due, or the debt is
      converted, the Company will expense the remaining unamortized balance of these
      costs at that time.





**Inventories**


Inventories
      consist of coffee and other beverage ingredients, cups, napkins, and other
      serving goods, and are valued at the lower of cost or market, computed on the
      first-in, first-out basis.





**Property
      and equipment**


Property
      and equipment are stated at cost less accumulated depreciation. Depreciation
      is
      provided for in amounts sufficient to relate the cost of depreciable assets
      to
      operations over their estimated service lives. The estimated lives in
      determining depreciation are recognized primarily on the straight-line method
      over estimated useful lives of five to seven years for equipment, signs,
      vehicles, and site preparation and engineering. For leasehold improvements
      and
      buildings, the Company depreciates the assets over the shorter of their estimate
      useful lives or original lease terms plus any renewal periods for which renewal
      has been determined to be reasonably assured.





**Intangible
      Assets**


In
      accordance with SFAS No. 142, “Goodwill *and
      Other Intangible Assets* ,”
the
      Company evaluates intangible assets and other long-lived assets for impairment,
      at least on an annual basis and whenever events or changes in circumstances
      indicate that the carrying value may not be recoverable from its estimated
      future cash flows.  Recoverability of intangible assets and other
      long-lived assets is measured by comparing their net book value to the related
      projected undiscounted cash flows from these assets, considering a number of
      factors including past operating results, budgets, economic projections, market
      trends and product development cycles. If the net book value of the asset
      exceeds the related undiscounted cash flows, the asset is considered impaired,
      and a second test is performed to measure the amount of impairment loss.
      Impairment of $80,165 was recorded for the year ended December 31, 2006 related
      to new product formulation and brand re-imaging. No impairment was recorded
      during the year ended December 31, 2005.




F-8




**JAVA
        DETOUR, INC. AND SUBSIDIARIES**
 **NOTES
        TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS**
 **DECEMBER
        31, 2006 AND 2005**




**Deferred
      Rent**


For
      those
      leases that require fixed rental escalations during their lease terms, rent
      expense is recognized on a straight-line basis resulting in deferred rent of
      $240,520 at December 31, 2006. The liability will be satisfied through future
      rental payments.





**Income
      Taxes**


The
      Company accounts for income taxes in accordance with SFAS 109, *Accounting
      for Income Taxes.* The
      Company records deferred income tax assets and liabilities based up the
      difference between the financial statement and income tax bases of assets and
      liabilities using enacted income tax rates. Valuation allowances are established
      when necessary to reduce deferred income tax assets to the amount expected
      to be
      realized. Income tax expense is the taxes paid and payable for the period and
      the change during the period in the net deferred income tax assets and
      liabilities.





**Revenue
      Recognition**





***Initial
      Franchise Fees***


Initial
      franchise fee income is recognized as revenue in accordance with Statement
      of
      Financial Accounting Standards (SFAS) No. 45 “Accounting for Franchise Fee
      Revenue.” SFAS 45 requires franchisors to recognize revenue from individual and
      area franchise sales only when all material services or conditions relating
      to
      the sale have been substantially performed or satisfied by the franchisor.
      In
      accordance with SFAS 45, the Company recognizes these fees as revenue upon
      the
      Company’s material and substantial performance of its obligations under the
      Franchise Agreement, which usually occurs at the commencement of operations
      of
      the individual location, unless it can be demonstrated that substantial
      performance has occurred before this time. Initial franchise fee income amounted
      to $0 for the years ended December 31, 2006 and 2005, respectively.





***Area
      Development Fees***


Area
      development fee income is recognized in accordance with SFAS 45 on a pro rata
      basis of the required quota of stores to be opened upon the Company’s material
      and substantial obligations under its area development agreement which usually
      occurs upon the Company’s approval of applicants to become franchisees provided
      by the area developer. Area development fee income from the Company’s franchisee
      in the Midwest amounted to $18,000 and $9,000 for the years ended December
      31,
      2006 and 2005, respectively.





***Master
      License Agreement Fees***


Master
      license agreement fee income is recognized as revenue in accordance with
      Statement of Financial Accounting Standards (SFAS) No. 45 “Accounting for
      Franchise Fee Revenue.” SFAS 45 requires franchisors to recognize revenue from
      individual and area franchise sales only when all material services or
      conditions relating to the agreement have been substantially performed or
      satisfied by the franchisor. In accordance with SFAS 45, the Company recognizes
      these fees as revenue upon the Company’s material and substantial performance of
      its obligations under the Master License Agreement, which usually occurs at
      the
      completion of operations training for the Master Licensee. There was no master
      license agreement fee income for the years ended December 31, 2006 and 2005,
      respectively.




F-9


**JAVA
        DETOUR, INC. AND SUBSIDIARIES**
 **NOTES
        TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS**
 **DECEMBER
        31, 2006 AND 2005**




***Royalties***


Royalty
      income of 3% of defined net sales is earned based on sales by franchisees and
      is
      recognized monthly as revenue when the related sales are reported to the
      Company. Additionally, the Company may receive a rebate or charge a mark-up
      for
      delivered supplies and coffee. Royalty income amounted to $48,701 and $44,282
      for the years ended December 31, 2006 and 2005, respectively.





***Promotional
      Fund Fees***


Promotional
      fund fee income of 1% of defined net sales is earned based on sales by
      franchisees, and is deferred until the promotional fund fee expenses are
      incurred by the Company. Promotional fund fee income amounted to $13,443 and
      $14,760 for the years ended December 31, 2006 and 2005,
      respectively.





***Retail
      Revenues***


Company-operated
      retail store revenues are recognized when payment is tendered at the point
      of
      sale. Retail revenues amount to $6,317,946 and $6,032,053 for the years ended
      December 31, 2006 and 2005, respectively.





**Deferred
      Revenue**


Deferred
      revenue consists of the portion of the initial franchise fees received from
      franchisees who have not commenced operations, the pro rata portion of the
      initial fees received from area development fees of which the Company has not
      approved franchisee applications for the required quota, master license
      agreement fees of which the Company has not completed its obligations and the
      excess, if any, of the 1% weekly promotional fund fees received from franchisees
      less the related promotional fund expenses incurred by the Company.




**Rewards/Gift
      Cards**


Revenues
      from the Company’s stored value cards, such as the Java Detour rewards/gift
      card, are recognized when tendered for payment or upon redemption. Outstanding
      customer balances are included in “Accrued expenses and other current
      liabilities” on the accompanying consolidated balance sheet. There are no
      expiration dates on the Company’s rewards/gift cards and Java Detour does not
      charge any service fees that cause a decrement to customer balances. As of
      December 31, 2006 the Company has recorded $139,942 in accrued expenses and
      other current liabilities for the stored value cards.





While
      the
      Company will continue to honor all stored rewards/gift cards presented for
      payment, management may determine the likelihood of redemption to be remote
      for
      certain card balances due to, among other things, long periods of inactivity.
      In
      these circumstances, to the extent management determines there is no requirement
      for remitting card balances to government agencies under unclaimed property
      laws, card balances may be recognized in the consolidated statements of
      operations in “Other income.” The Company recognized $13,402 and $0 for the
      years ended December 31, 2006 and 2005, respectively.





The
      Company offers two types of discounts to its customers, reward cards and 2
      for 1
      coupons. The Company’s reward cards, rewards customers for dollars spent at Java
      Detour stores. Every time a customer makes a purchase and presents their card,
      the value of their purchase is tracked on the card.  Each time a customer
      spends at least $35.00, $3.50 is loaded on their card and can be used toward
      future purchases.  This constitutes approximately 99% of all discounts.
      Occasionally the Company will promote Java Detour in local markets and publish
      “Buy one drink and get the second drink free” in newspapers and local coupon
      books, which are redeemable at any Java Detour store. The Company accounts
      for
      these discounts in accordance with the conclusions reached by the Emerging
      Issues Task Force in Issue No. 01-09 “Accounting for Consideration Given by a
      Vendor to a Customer (Including a Reseller of the Vendor's Products)” as a
      reduction in revenue and the above rewards and/or discounts are included in
      the
      line item “Sales and other operating revenues, net” in the Company’s
      Consolidated Statements of Operations.





**Use
      of Estimates**


The
      preparation of financial statements in conformity with accounting principles
      generally accepted in the United States of America requires management to make
      estimates and assumptions that affect certain reported amounts and disclosures.
      Accordingly, actual results could differ from those estimates.




F-10




**JAVA
        DETOUR, INC. AND SUBSIDIARIES**
 **NOTES
        TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS**
 **DECEMBER
        31, 2006 AND 2005**




**Earnings
      Per Share**


In
      accordance with SFAS No. 128, “Earnings *Per
      Share* ,”
the
      basic loss per common share is computed by dividing net loss available to common
      stockholders by the weighted average number of common shares outstanding.
 Diluted loss per common share is computed similar to basic loss per common
      share except that the denominator is increased to include the number of
      additional common shares that would have been outstanding if the potential
      common shares had been issued and if the additional common shares were dilutive.
       At December 31, 2006, the Company had 7,344,165 of potential
      dilutive securities. The Company’s potential dilutive securities included
      5,020,000 warrants that are exercisable between $0.60 and $2.00 a share for
      the
      purchase of common stock and 2,324,165 of stock options that are exercisable
      between $1.00 and $1.10 a share for the purchase of common stock. At
      December 31, 2005, the Company had 1,337,965 of potential dilutive securities.
      These potential dilutive securities included 191,254 warrants, 295,454 shares
      that are issuable upon the conversion of JDCO’s Series A convertible preferred
      Stock, 762,500 share of common stock issuable upon the conversion of 50% of
      outstanding convertible notes at $1.00 per share and 88,757 shares of common
      stock issuable upon the conversion of JDCO’s $300,000 related party convertible
      note into series B convertible preferred stock and the further conversion of
      the
      series B preferred Stock into common stock. Due to the net loss,
      none of the potentially dilutive securities were included in the calculation
      of
      diluted earnings per share since their effect would be
      anti-dilutive.





**Costs
      of Sales**


Included
      in costs of sales are coffee beans, dairy products, other beverage ingredients,
      paper products and food.  These costs include freight charges, purchasing
      and receiving costs, warehousing cost and other distribution network
      costs.





**Store
      Operating Expenses**


Store
      operating expenses consist of direct and indirect labor, operating supplies,
      store utilities, travel and entertainment, store maintenance, store leases,
      store advertising, insurance, and taxes and licenses.





**Selling,
      General and Administrative Expenses**


Selling,
      general and administrative expenses consist of salaries and related benefits,
      travel and entertainment, corporate headquarters rent and utilities,
      corporate advertising and marketing, and professional fees.





**Advertising
      and Marketing Costs**


The
      Company expenses costs of advertising and marketing as incurred.
 Advertising and marketing expense for the years ended
      December 31, 2006 and 2005 were $198,673 and $60,395,
      respectively.





**Promotional
      Fund Expenses**


Promotional
      costs are charged to expense during the period incurred. These costs arise
      from
      advertising for area franchisee stores. These costs are indirect to the Company
      in that they receive a promotional fee from the franchisees to pay for these
      costs.




**Stock
      Based Compensation to Other than Employees**


The
      Company accounts for equity instruments issued in exchange for the receipt
      of
      goods or services from other than employees in accordance with Statement of
      Financial Accounting Standards No. 123, “Accounting *for
      Stock-Based Compensation* ,”
and
      the conclusions reached by the Emerging Issues Task Force in Issue No. 96-
      18,
“Accounting for Equity Instruments That Are Issued to Other Than Employees for
      Acquiring or in Conjunction with Selling Goods or Services” (“EITF 96-18”).
      Costs are measured at the estimated fair market value of the consideration
      received or the estimated fair value of the equity instruments issued, whichever
      is more reliably determinable. The value of equity instruments issued for
      consideration other than employee services is determined on the earlier of
      a
      performance commitment or completion of performance by the provider of goods
      or
      services as defined by EITF 96-18. In the case of equity instruments issued
      to
      consultants, the fair value of the equity instrument is recognized over the
      term
      of the consulting agreement.





**Recently
      Issued Accounting Pronouncements**


The
      Company has adopted all accounting pronouncements effective before
      December 31, 2006, which are applicable to the Company.




F-11


**JAVA
        DETOUR, INC. AND SUBSIDIARIES**
 **NOTES
        TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS**
 **DECEMBER
        31, 2006 AND 2005**




In
      June 2006, the Emerging Issues Task Force issued EITF No.06-3, How Taxes
      Collected from Customers and Remitted to Governmental Authorities Should Be
      Presented in the Income Statement (That Is, Gross versus Net Presentation)
      (“EITF No.06-3”), which clarifies diversity in practice on the presentation of
      different types of taxes in the financial statements. The Task Force concluded
      that, for taxes within the scope of the issue, a company may adopt a policy
      of
      presenting taxes either gross within revenue or net. That is, it may include
      charges to customers for taxes within revenues and the charge for the taxes
      from
      the taxing authority within cost of sales, or, alternatively, it may net the
      charge to the customer and the charge from the taxing authority. If taxes
      subject to this Issue are significant, a company is required to disclose its
      accounting policy for presenting taxes and the amounts of such taxes that are
      recognized on a gross basis. The guidance in this consensus is effective for
      the
      first interim reporting period beginning after December 15, 2006. The
      Company is currently assessing the impact, if any, that the adoption EITF
      No.06-03 will have on its financial statements.




In
      July 2006, the FASB issued FASB Interpretation No. 48, Accounting for
      Uncertainty in Income Taxes—An Interpretation of FASB Statement No. 109
      (“FIN No. 48”), which became effective for the Company on January 1,
      2007. This interpretation clarifies the accounting for income tax benefits
      that
      are uncertain in nature. Under FIN No. 48, a company will recognize a tax
      benefit in the financial statements for an uncertain tax position only if
      management’s assessment is that its position is “more likely than not” (i.e., a
      greater than 50 percent likelihood) to be upheld on audit based only on the
      technical merits of the tax position. This accounting interpretation also
      provides guidance on measurement methodology, derecognition thresholds,
      financial statement classification and disclosures, interest and penalties
      recognition, and accounting for the cumulative-effect adjustment. The new
      interpretation is intended to provide better financial statement comparability
      among companies.




Required
      annual disclosures include a tabular reconciliation of unrecognized tax benefits
      at the beginning and end of the period; the amount of unrecognized tax benefits
      that, if recognized, would affect the effective tax rate; the amounts of
      interest and penalties recognized in the financial statements; any expected
      significant impacts from unrecognized tax benefits on the financial statements
      over the subsequent 12-month reporting period; and a description of the tax
      years remaining to be examined in major tax jurisdictions. FIN No. 48 is
      effective for fiscal years beginning on or after December 15, 2006. The
      Company is currently assessing the impact, if any, that the adoption of FIN
      No. 48 will have on its financial statements.




In
      September 2006, the Securities and Exchange Commission issued Staff Accounting
      Bulletin ("SAB") No. 108, "Considering the Effects of Prior Year Misstatements
      when Quantifying Misstatements in Current Year Financial Statements". SAB No.
      108 was issued in order to eliminate the diversity in practice surrounding
      how
      public companies quantify financial statement misstatements. SAB No. 108
      requires that registrants quantify errors using both a balance sheet (iron
      curtain) approach and an income statement (rollover) approach then evaluate
      whether either approach results in a misstated amount that, when all relevant
      quantitative and qualitative factors are considered, is material. SAB No. 108
      is
      effective for fiscal years ending after November 15, 2006. The Company adopted
      the bulletin during 2006. The adoption did not have a material effect on its
      consolidated results of its operations, financial position, or cash
      flows.





In
      September 2006, the FASB issued SFAS No. 157, “Fair *Value Measurements* .”
This
      statement clarifies the definition of fair value, establishes a framework for
      measuring fair value and expands the disclosures on fair value measurements.
      SFAS No. 157 is effective for fiscal years beginning after
      November 15, 2007. Management has not determined the effect, if any; the
      adoption of this statement will have on the financial statements.





In
      September 2006, the FASB issued SFAS No. 158, “Employers' Accounting for Defined
      Benefit Pension and Other Postretirement Plans−An amendment of FASB Statements
      No. 87, 88, 106, and 132(R)”. One objective of this standard is to make it
      easier for investors, employees, retirees and other parties to understand and
      assess an employer's financial position and its ability to fulfill the
      obligations under its benefit plans. SFAS No. 158 requires employers to fully
      recognize in their financial statements the obligations associated with
      single−employer defined benefit pension plans, retiree healthcare plans, and
      other postretirement plans. SFAS No. 158 requires an employer to fully recognize
      in its statement of financial position the over funded or under funded status
      of
      a defined benefit postretirement plan (other than a multiemployer plan) as
      an
      asset or liability and to recognize changes in that funded status in the year
      in
      which the changes occur through comprehensive income. This Statement also
      requires an employer to measure the funded status of a plan as of the date
      of
      its year-end statement of financial position, with limited exceptions. SFAS
      No.
      158 requires an entity to recognize as a component of other comprehensive
      income, net of tax, the gains or losses and prior service costs or credits
      that
      arise during the period but are not recognized as components of net periodic
      benefit cost pursuant to SFAS No. 87. This Statement requires an entity to
      disclose in the notes to financial statements additional information about
      certain effects on net periodic benefit cost for the next fiscal year that
      arise
      from delayed recognition of the gains or losses, prior service costs or credits,
      and transition asset or obligation. The Company is required to initially
      recognize the funded status of a defined benefit postretirement plan and to
      provide the required disclosures for fiscal years ending after December 15,
      2006. Management believes that this statement will not have a significant impact
      on the financial statements.




F-12


**JAVA
        DETOUR, INC. AND SUBSIDIARIES**
 **NOTES
        TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS**
 **DECEMBER
        31, 2006 AND 2005**




In
      December 2006, the FASB issued FSP EITF 00-19-2, “Accounting for
      Registration Payment Arrangements.” This FASB Staff Position (“FSP”) addresses
      an issuer’s accounting for registration payment arrangements. This FSP specifies
      that the contingent obligation to make future payments or otherwise transfer
      consideration under a registration payment arrangement, whether issued as a
      separate agreement or included as a provision of a financial instrument or
      other
      agreement, should be separately recognized and measured in accordance with
      FASB
      Statement No. 5, *Accounting
      for Contingencies* .
      The
      guidance in this FSP amends FASB Statements No. 133, *Accounting
      for Derivative Instruments and Hedging Activities* ,
      and No.
      150, *Accounting
      for Certain Financial Instruments with Characteristics of both Liabilities
      and
      Equity* ,
      and
      FASB Interpretation No. 45, *Guarantor’s
      Accounting and Disclosure Requirements for Guarantees, Including Indirect
      Guarantees of Indebtedness of Others* ,
      to
      include scope exceptions for registration payment arrangements. This FSP further
      clarifies that a financial instrument subject to a registration payment
      arrangement should be accounted for in accordance with other applicable
      generally accepted accounting principles (“GAAP”) without regard to the
      contingent obligation to transfer consideration pursuant to the registration
      payment arrangement. This
      FSP
      is effective immediately for registration payment arrangements and the financial
      instruments subject to those arrangements that are entered into or modified
      subsequent to the date of issuance of this FSP. For registration payment
      arrangements and financial instruments subject to those arrangements that were
      entered into prior to the issuance of this FSP, this guidance shall be effective
      for financial statements issued for fiscal years beginning after December 15,
      2006, and interim periods within those fiscal years. Early adoption of this
      FSP
      for interim or annual periods for which financial statements or interim reports
      have not been issued is permitted. The Company has chosen to adopt this FSP
      early. See
      note
      12 for effect of the adoption of this pronouncement.





**NOTE
      2 - ACCOUNTS RECEIVABLE**





Accounts
      receivable as of December 31, 2006 include rebate balances and balances due
      from lessees and franchisees totaling $53,568.




F-13


**JAVA
        DETOUR, INC. AND SUBSIDIARIES**
 **NOTES
        TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS**
 **DECEMBER
        31, 2006 AND 2005**




**NOTE
      3 - PROPERTY AND EQUIPMENT**





Property
      and equipment consist of the following at December 31, 2006:





Land
            
            $
            425,000Site
                preparation and engineering
            
            
            131,217Buildings
            
            
            1,980,559Leasehold
                improvements
            
            
            2,120,927Signs
            
            
            471,532Store
                equipment
            
            
            1,110,827Other
                equipment, furniture, and vehicles
            
            
            442,328Total
            
            
            6,682,390Less
                accumulated depreciation
            
            
            (1,557,607
            )Property
                and equipment, net
            
            $
            5,124,783Depreciation
                expense for the years ending December 31, 2006 and 2005 was $430,193
                and
                $374,792, respectively. Accumulated depreciation for assets under
                capital
                leases was $331,131 at December 31, 2006. Depreciation expense for
                the
                assets under capital leases was $150,379 and $104,907 for years ended
                December 31, 2006 and 2005, respectively.





**NOTE
      4 - INTANGIBLE ASSETS**




Other
      intangible assets consist of the following at December 31, 2006:





Franchise
                operating manuals
            
            
            5,600Total
            
            $
            5,600





The
      Company has evaluated the intangible assets for impairment and has estimated
      that $5,600 of the carrying value will be recoverable from its estimated future
      cash flows. Impairment of $80,165 was recorded for the year ended December
      31,
      2006 relating to new product formulation and brand re-imaging. No impairment
      was
      recorded during the year ended December 31, 2005.





**NOTE
      5 - NOTES RECEIVABLE**





During
      2005, the Company sold one of its Bakersfield, California locations to an
      unrelated third party for a note receivable in the amount of $450,368. The
      term
      of the note is for ten years and bears interest at the rate of 6% annually.
      The
      Company recorded a gain on the sale of this store of $300,052 and is included
      in
      Other Income on the accompanying statement of operations for the year ended
      December 31, 2005. As of December 31, 2006, $438,221 was still owed to the
      Company under this note, of which $43,641 is due over the next twelve months.
      In
      addition, the Company paid other fees, such as property taxes on behalf of
      the
      new store owner in exchange for a note receivable in the amount of $6,250.
      As of
      December 31, 2006 the entire balance is still due the Company.





**NOTE
      6 - LONG-TERM OBLIGATIONS**





Long-term
      obligations, excluding capital leases, consist of the following:




F-14




**JAVA
      DETOUR, INC. AND SUBSIDIARIES**


**NOTES
      TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS**


**DECEMBER
      31, 2006 AND 2005**




**2006**Notes
                payable to a bank, payable in monthly installments with interest
                at Prime
                Rate plus 1.75% (10.00% at December 31, 2006), maturing in 2021
                through 2029, secured by the property and equipment at four
                stores
            
            $
            876,541Notes
                payable to a multi-bank organization, payable in monthly installments
                with
                interest at Prime Rate plus 2.75% (11.00% at December 31, 2006),
                maturing in 2009, secured by substantially all the Company’s
                assets
            
            
            80,658Term
                loan from vehicle dealer, payable in monthly installments with fixed
                interest of 7.69% maturing in 2008, secured by one vehicle
            
            
            23,945Total
                notes payable
            
            $
            981,145Less
                current portion
            
            
            48,007Long-term
                obligations
            
            $
            933,138





Scheduled
      annual maturities of long-term obligations, excluding capital leases, are as
      follows:





2007
            
            $
            48,0072008
            
            
            53,1682009
            
            
            48,0502010
            
            
            48,9222011
            
            
            34,033Thereafter
            
            
            748,965Total
            
            $
            981,145





**NOTE
      7 - LEASE COMMITMENTS**





The
      Company currently has 31 capital leases. Approximately 60% of the leases have
      a
      60-month term with a $1.00 buyout option after the final payment under the
      lease. The remaining leases have terms of either 36 or 48 months. Additionally,
      7% of the leases required a 10% balloon payment at the beginning of the lease,
      and 3% call for a fair market buy out. All leases have either the final month
      prepaid or a single payment on account as a refundable security deposit. None
      of
      the leases have an escalation clause; however annual payments may vary slightly
      if there are changes to regional sales or property tax rates.





Capital
      lease obligations consist of the following:





**2006**Lease
                for the land of the Red Bluff store site, on which payments, less
                interest
                at 10% per annum, are credited toward purchase of the land; expires
                in
                2012 with options to extend by two six-year periods; full ownership
                would
                be attained in 2022 under present terms
            
            $
            218,950Lease
                for the land of the Chico store site, on which payments, less interest
                at
                9% per annum, may be credited toward purchase of the land; expires
                in
                2010, but payments will be sufficient to exercise the purchase option
                in
                2007
            
            
            3,956Leases
                for property and equipment at several store sites, expiring through
                2010,
                a majority of the total balance guaranteed by two
                stockholders
            
            
            781,124Total
            
            $
            1,004,030





The
      Company leases its headquarters and most of its store sites under long-term
      operating lease agreements expiring in 2011 through 2021. Included in these
      are
      18 operating leases governing 12 of its stores (two for its San Francisco and
      San Rafael stores each), a 15th lease for a property it sublets in Bakersfield
      and a 16th on undeveloped land in Lincoln, CA. Additional leases exists for
      the
      Company’s headquarters in California and its sales office in North Carolina. The
      leases initially run for either 5, 10 or 15 years and each store has between
      one
      and five-year extensions available. Seven leases have pre-established rent
      increase that take effect when each five-year option is exercised, all others
      have small annual rent increases and allow for renegotiation of the rental
      amount before options are exercised. Rent expense under operating leases totaled
      $628,488 for 2006 and $519,985 for 2005.




F-15




**JAVA
        DETOUR, INC. AND SUBSIDIARIES**
 **NOTES
        TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS**
 **DECEMBER
        31, 2006 AND 2005**




Future
      minimum lease payments are as follows:





**Capital**
            
            **Operating**
            
            **Total**2007
            $
            387,393
            
            $
            896,845
            
            $
            1,284,2382008
            
            361,662
            
            
            922,651
            
            
            1,284,3132009
            
            258,487
            
            
            935,423
            
            
            1,193,9102010
            
            126,648
            
            
            897,198
            
            
            1,023,8462011
            
            60,759
            
            
            813,110
            
            
            873,869Thereafter
            
            278,988
            
            
            4,293,969
            
            
            4,572,957Total
            $
            1,473,937
            
            $
            8,759,196
            
            $
            10,233,133Less
                amounts representing interest
            
            (469,907
            )Present
                value of minimum lease payments
            
            1,004,030Less
                current portion
            
            (236,393
            )Total,
                net of current portion
            $
            767,637Depreciation
                expense for the assets under capital leases was $142,679 and $113,216
                for
                years ended December 31, 2006 and 2005, respectively




**NOTE
      8 - LINES OF CREDIT**




The
      Company had unused lines of credit with interest rates ranging from 8.25% to
      10.50%. Total available credit under the line of credit with Wells Fargo Bank
      is
      $100,000. Total available credit under the line of credit with Summit Bank
      was
      $1.5 million. The Summit Bank line of credit was guaranteed by the three
      officers of the Company and a stockholder. As additional consideration for
      guaranteeing the Summit Bank line of credit in 2004, the Company granted
      six-year warrants to purchase 72,072 shares of common stock at $2.22 per share
      (see Note 12). During the year ended December 31, 2006 the warrants to purchase
      72,072 shares of common stock were exercised on a cashless basis in exchange
      for
      16,176 shares of JDCO common stock prior to the close of the Merger. The Company
      paid off its various lines of credit as of the close of the Merger, at which
      time the Summit Bank line of credit was cancelled. Outstanding balances as
      of
      December 31, 2006 totaled $0.





**NOTE
      9 - CONVERTIBLE NOTES PAYABLE**





During
      the years ended December 31, 2002 through 2004 the Company issued $1,525,000
      in
      convertible notes payable of which $170,000 was to a stockholder. The notes
      bear
      interest at ten percent, are due December 31, 2007 and fifty percent of the
      value of the notes are convertible at the holder’s option into common shares of
      the company at $1.00 per share. The values of the debentures were allocated
      between the debenture and the beneficial conversion feature, which amounted
      to $1,266,000 and $89,000, respectively.  The discount related to
      the beneficial conversion features of $89,000 is being amortized over the term
      of the debenture. The Company amortized $39,607 and $19,804 to interest expense
      during the years ended December 31, 2006 and 2005, respectively. In addition,
      as
      part of the transaction the Company paid $155,000 and issued 250,000 shares
      of
      common stock of the Company to a related party valued at $250,000 as offering
      costs. These costs are being amortized over the term of the debentures. The
      Company recorded amortization of $81,777 to interest expense during the year
      ended December 31, 2005. During the year ended December 31, 2006 these notes
      were converted into 2,927,013 post split shares of common stock. Of the notes,
      fifty percent or $762,500 were converted at $1.00 per share (pre-split) for
      762,500 shares (2,258,746 post split) and the remaining $762,500 were converted
      at $3.38 per share (pre-split) for 225,592 shares (668,267 post split). As
      a
      result of the conversion, the Company recognized all unamortized deferred
      offering costs and recorded $150,655 of interest expense for the year ended
      December 31, 2006. In addition, the above shareholders converted $104,576 of
      accrued interest at $3.38 (pre-split) per share into 31,002 shares (91,837
      post
      split).




F-16


**JAVA
        DETOUR, INC. AND SUBSIDIARIES**
 **NOTES
        TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS**
 **DECEMBER
        31, 2006 AND 2005**




**NOTE
      10 - RELATED PARTY CONVERTIBLE NOTE PAYABLE**





In
      addition to the $170,000 convertible note payable issued to a stockholder as
      discussed in Note 9, during 2005 the Company issued a $300,000 convertible
      note
      payable to an unrelated party. As additional consideration for issuing the
      debenture, the Company granted six-year warrants to purchase 1,000 shares of
      common stock at $3.38 per share (see Note 12). During 2005, the note was
      assigned to a related party. The note was convertible into the Company’s Series
      B preferred stock at a rate of $3.38 per share. As of December 31, 2006 the
      balance has been converted into 88,757 shares of JDCO common stock (exchanged
      for 262,925 shares of our common stock upon closing of the Merger) at $3.38
      per
      share, and the warrants 1,000 were exercised on cashless basis for 224 shares
      of
      JDCO common stock (exchanged for 664 shares of our common stock upon closing
      of
      the Merger).





**NOTE
      11 - INCOME TAXES**





The
      provision (benefit) for income taxes consists of the following:


**December
                31,****2006**
            
            **2005**Deferred
                income tax benefit for net operating losses
            
            $
            (3,996
            )
            $
            (136,812
            )Current
                income tax expense
            
            
            ---
            
            
            1,600Income
                tax benefit, net
            
            $
            (3,996
            )
            $
            (135,212
            )





Deferred
      income taxes reflect the net tax effects of temporary differences between the
      carrying amounts of assets and liabilities for financial statement purposes
      and
      the amounts used for income tax purposes. Significant components of the
      Company’s deferred tax liabilities and assets as of December 31, 2006
      are as follows:





**2006**Net
                operating loss carry-overs for federal income taxes totaling $4,944,252,
                expiring in 2022 through 2026
            
            $
            1,760,627Net
                operating loss carry-overs for state of California income taxes totaling
                $4,771,311, expiring in 2012 through 2016
            
            
            455,692Total
            
            
            2,216,319Valuation
                allowance
            
            
            (1,730,672
            )Deferred
                tax assets, net
            
            $
            485,647




The
      Components of deferred income tax expense (benefit) are as follows:





**December 31,**
              **2006**
            
            **December 31,**
              **2005**Depreciation
            
            $
            (23,103
            )
            
            ---Contingent
                liability for registration rights
            
            
            (64,260
            )
            
            ---Accrued
                vacation
            
            
            (11,222
            )
            
            11,222Accrued
                officer salaries
            
            
            (5,623
            )
            
            (5,215
            )Net
                operating loss carryforward
            
            
            (1,121,123
            )
            
            (179,328
            )Increase
                in valuation allowance
            
            
            1,221,335
            
            
            36,509Income
                tax (benefit)
            
            $
            (3,996
            )
            $
            (136,812
            )




F-17


**JAVA
        DETOUR, INC. AND SUBSIDIARIES**
 **NOTES
        TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS**
 **DECEMBER
        31, 2006 AND 2005**




Following
      is a reconciliation of the amount of income tax expense (benefit) that would
      result from applying the statutory federal income tax rates to pre-tax income
      and the reported amount of income tax expense (benefit):





**2006**
            
            **2005**Tax
                benefit (expense) at federal statutory rates
            
            $
            (1,308,715
            )
            $
            (174,830
            )Depreciation
            
            
            18,336
            
            
            (8,906
            )Timing
                differences
            
            
            427,785
            
            
            112,750Increase
                in valuation allowance
            
            
            862,594
            
            
            72,586Income
                tax benefit, net
            
            $
            0
            
            $
            1,600





At
      December 31, 2006, the Company has provided a partial valuation
      allowance for the deferred tax assets since management has determine that the
      realization of a portion of that asset is more likely than not.





**NOTE
      12 - STOCKHOLDER’S EQUITY**





PREFERRED
      STOCK





The
      Company is authorized to issue up to 5,000,000 shares of $0.001 par value
      preferred stock. As of December 31, 2006, the Company does not have any shares
      of preferred stock outstanding, All transactions relating to preferred stock
      prior to the reverse merger were that of JDCO.





In
      March
      2006 JDCO amended its articles of incorporation to change its preferred stock
      from no par to par value of $0.001. The accompanying financial statements have
      been retroactively restated to present the effect of this change in par value.
      All preferred shares issued prior to the reverse merger were of Series A of
      JDCO. Series A preferred shares were convertible, at the holders’ option at
      any time, into an equal number of common shares, subject to adjustments to
      account for stock splits, stock dividends, and certain other events including
      the conversion of the convertible notes. Prior to the reverse merger, the Series
      A preferred shareholders converted all of their shares into 295,454 pre split
      (875,222 post split) shares of common stock. These shareholders also converted
      $173,346 of accrued dividends payable at $3.38 per share (pre split) into 51,286
      pre split shares (151,294 post split) of common stock. The Series A shareholders
      exercised warrants to purchase 118,182 shares of common stock granted to them
      in
      connection with their purchase of the series A preferred stock on a cashless
      basis for 42,924 pre split shares (127,153 post split). The holders of the
      Company’s secured convertible notes due December 31, 2007 exercised their
      conversion rights under those notes in their entirety and as a result the Series
      A shareholders were issued an additional 63,094 pre split shares (186,903 post
      split) under their rights per their subscription agreements.





COMMON
      STOCK





Through
      private placements in 2005 the Company raised $100,000 and issued 178,289 shares
      of common stock.





On
      November 30, 2006, as part of a single private placement, the Company sold
      10,000,000 shares together with five-year warrants to purchase 2,500,000 shares
      of common stock at $2.00 per share for total consideration of $10.0 million.
      As
      part of the transaction, the Company paid the placement agent $1,050,000 for
      commissions and fees and granted warrants to purchase 2,000,000 shares of common
      stock with the same terms as those granted to the investors in the placement
      except that the placement agent warrants are exercisable nine months from the
      date of issuance and have a cashless exercise feature. The shares included
      in
      the Private Placement have weighted average anti-dilution coverage for the
      issuance of securities within 12 months of the closing of the Merger at a price
      below $1.00, subject to customary exceptions.





As
      part
      of the private placement, the Company entered into a share registration rights
      agreement, whereby the Company agreed to register the shares of common stock
      sold in the placement. The agreement requires the Company to file a registration
      statement within 30 days of the closing and to have the registration statement
      declared effective within 120 days of the closing. If the Company fails to
      have
      the registration statement declared effective within 120 days, the Company
      must
      pay a prorated monthly penalty of 1.5% of the amount raised. The Company filed
      the registration statement on Form SB-2 to register 9,442,593 shares of the
      common stock sold in the Private Placement on December 29, 2006. The
      registration statement has not been declared effective and management does
      not
      believe it will be declared effective within 120 days of the
      closing.




F-18


**JAVA
        DETOUR, INC. AND SUBSIDIARIES**
 **NOTES
        TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS**
 **DECEMBER
        31, 2006 AND 2005**




The
      Company also entered into warrant registration rights agreement, whereby the
      Company agreed to register the remaining shares of the common stock sold in
      the
      private placement, the shares underlying the warrants issued in the private
      placement and 4,418,403 **** shares
      of
      common stock which are owned by the placement agent and its affiliates. The
      agreement requires the Company to file a registration statement within 10 days
      of June 29, 2007 and to have the registration statement declared effective
      within 120 days of such filing. If the Company fails to have the registration
      statement declared effective within 120 days, the Company must pay a prorated
      monthly penalty of 1.5% of the amount raised.


In
      accordance with FSP EITF 00-19-2, on the date of the private placement, the
      Company reviewed the terms of the registration rights agreements and as of
      that
      date, the Company believed they would meet all of the required deadlines under
      both of the agreements. As a result, the Company did not record any liability
      associated with the registration rights agreement. The Company now believes
      that
      the registration statement covering the shares issued in the private placement
      will not be declared effective with the 120 day requirement. As a result the
      Company has determined that it is probable that the registration statement
      will
      be declared effective within 30 days of the deadline and has recorded a
      contingent liability of $150,000 representing one month of registration rights
      penalties. The Company will continue to review the progress of the effectiveness
      of the registration rights agreement and adjust the contingent liability
      accordingly. The Company continues to believe it will meet its deadlines for
      the
      registration and effectiveness of the stock underlying the warrant registration
      rights agreement and has not recorded any contingent liability associated with
      those shares.





The
      warrants granted to the investors in the above private placement were treated
      as
      permanent equity pursuant to exemption from FAS 133 under paragraph
      11a.





During
      the fourth quarter of 2006, the Company issued 793,403 shares of common stock
      with a value of $793,403 to a consultant for services performed.





**Common
      Stock Issued for Debt and Warrant Conversion**


The
      Company issued common shares to convert outstanding indebtedness and warrants
      for the year ended December 31, 2006. The indebtedness and warrants converted
      were as follows:




**Summarized**




**Description**
            
            **Amount**
            
            **Shares
                Acquired****Convertible
                notes and accrued interest**
            $
            1,444,204
            
            2,678,910**Related
                party notes payable**
            $
            572,315
            
            501,586**Related
                party convertible notes payable**
            $
            485,583
            
            602,871**Convertible
                Series A preferred stock**
            $
            -
            
            1,062,125**Accrued
                dividends**
            $
            173,346
            
            151,924**Warrants
                converted on cashless basis**
            $
            -
            
            127,154**Total**
            $
            2,675,448
            
            5,124,570




F-19




**JAVA
        DETOUR, INC. AND SUBSIDIARIES**
 **NOTES
        TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS**
 **DECEMBER
        31, 2006 AND 2005**


DESCRIPTION
      OF STOCK PLANS




**Java
      Detour, Inc. 2006 Equity Incentive Plan**


On
      November 30, 2006, the Company’s board of directors adopted the Java
      Detour, Inc. 2006 Equity Incentive Plan (the “2006 Plan”).   Under
      the 2006 Plan, a total of 4,249,167 common shares will be available
      for issuance through the grant of a variety of common share-based awards under
      the plan.  Types of awards that may be granted under the 2006 Plan
      include stock awards, restricted stock awards and non-qualified and incentive
      stock options.  As of December 31, 2006, there were 2,324,165
      outstanding options under the 2006 Plan, all vesting over a period of 4
      years, and 1,925,002 shares available for issuance.




**Summary
      of Options Granted to Directors, Officers and Employees**


The
      following table summarizes compensatory options granted to directors, officers
      and other employees for the periods or as of the dates indicated, both under
      the
      aforesaid stock plans and in the form of free-standing grants:





**Options
                Granted**
            
            **Weighted
                Average**
              **Exercise
                Price**Balance,
                December 31, 2005Exercised
            
            
            0.00
            
            
            $
            0.00Cancelled
            
            
            0.00
            
            
            $
            0.00Granted
            
            
            2,324,165
            
            
            $
            1.03Exercisable,
                December 31, 2006
            
            
            2,324,165
            
            
            $
            1.03





The
      weighted average remaining contractual life of compensatory options outstanding
      for directors, officers and employees is 9.92 years at
      December 31, 2006.  The exercise prices for compensatory options
      outstanding for directors, officers and employees at December 31, 2006
      were as follows:





**Number
                of**
              **Options**
            
            
            **Exercise**
              **Price**1,685,000
            
            
            $1.00639,165
            
            
            $1.102,324,165





In
      accordance with FAS 123R, compensation expense of $33,619 was recognized as
      a
      result of the issuance of compensatory stock options issued to directors,
      officers and employees of the Company. At
      November 30, 2006, the date of grant, the Company calculated the value of these
      options using the Black-Scholes model based on the following assumptions: a
      risk-free rate of 4.75%, volatility of 130%, estimated life of 5 years and
      a
      fair market value of $1.00 per share. The total value of options granted was
      $2,017,159 and the unvested portion was $1,983,240.





For
      compensatory options granted to directors, officers and employees during the
      year ended December 31, 2006 where the exercise price equalled the
      stock price at the date of the grant, the weighted-average fair value of such
      options was $1.00 and the weighted-average exercise price of such options
      was $1.00  No options were granted during the year ended
      December 31, 2006, where the exercise price was less than the stock
      price at the date of the grant or the exercise price was greater than the stock
      price at the date of grant.




F-20


**JAVA
        DETOUR, INC. AND SUBSIDIARIES**
 **NOTES
        TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS**
 **DECEMBER
        31, 2006 AND 2005**


WARRANTS





We
      have
      outstanding warrants to purchase 5,020,000 shares of our common stock
      outstanding, exercisable at prices ranging from $0.60 to $2.00 per share for
      a
      five-year period from the date of issuance. 4,500,000 of the shares underlying
      such warrants have weighted average anti-dilution coverage for the issuance
      of
      securities within 12 months of the closing of the Merger at a price below $1.00,
      subject to customary exceptions.





The
      Company had the following warrants outstanding to purchase common shares as
      of
      December 31, 2006:





**2006**
            
            **2005**Warrants
                issued in conjunction with issuance of preferred stock
            
            
            0
            
            
            118,182Warrants
                issued in conjunction with signature guarantee
            
            
            0
            
            
            72,072Warrants
                issued in conjunction with issuance of promissory note
            
            
            500,000
            
            
            1,000Warrants
                issued in conjunction with the issuance of securities
            
            
            4,520,000
            
            
            05,020,000
            
            
            191,254





**Summary
      of Warrants Granted**


The
      following table summarizes warrants granted for the years ended December 31,
      2005 and 2006.





**Warrants**
            
            **Weighted
                Average**
              **Exercise
                Price**Balance,
                December 31, 2005
            
            
            191,254
            
            $
            3.38Exercised
            
            
            (191,254
            )
            $
            3.38Cancelled
            
            
            
            
            $
            0.00Granted
            
            
            5,020,000
            
            $
            1.86Balance,
                December 31, 2006
            
            
            5,020,000
            
            $
            1.86Exercisable,
                December 31, 2006
            
            
            5,020,000
            
            $
            1.86





The
      weighted average remaining contractual life of the common share purchase
      outstanding is 4.92 years at December 31, 2006.  The
      exercise prices for common share purchases outstanding at December 31, 2006
      were as follows:





**Number
                of**
              **Warrants**
            
            **Exercise**
              **Price**500,000
            
            $
                0.604,520,000
            
            $
                2.005,020,000





During
      the years ended December 31, 2006, the Company issued a total
      of 500,000 common share purchase warrants valued at $450,499 as
      additional consideration for the bridge loan from The Hunter Fund Limited of
      $500,000. The Company calculated the value of these warrants
      using the Black-Scholes model based on the following assumptions: a risk-free
      rate of 4.75%, volatility of 130%, estimated life of 5 years and a fair market
      value of $1.00 per share. The value of these warrants of $450,499 was recorded
      as deferred financing cost and was being amortized over the 2 year term of
      the
      note. Upon repayment of the note in December 2006, the remaining unamortized
      balance was expensed to interest.




F-21


**JAVA
        DETOUR, INC. AND SUBSIDIARIES**
 **NOTES
        TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS**
 **DECEMBER
        31, 2006 AND 2005**




On
      February 16, 2005, JDCO granted fully vested, six year warrants to purchase
      1,000 shares of common stock at an exercise price of $3.38 per share as
      additional consideration for the issuance of a $300,000 convertible note. At
      February 16, 2005, the Company calculated the value of these warrants using
      the
      Black-Scholes model based on the following assumptions: a risk-free rate of
      3.85%, volatility of 104%, estimated life of 1 1⁄2 years and a fair market value
      of $1.70 per share. The value of these warrants was $1,700. These warrants
      were
      converted to common stock on a cashless basis prior to the reverse
      merger.





**NOTE
      13 - COMMITMENTS AND CONTINGENCIES**





**Litigation**


From
      time
      to time, in the normal course of business, the Company is subject to routine
      litigation incidental to its business. Although there can be no assurances
      as to
      the ultimate disposition of any such matters, it is the opinion of management,
      based upon the information available at this time, that there are no matters,
      individually or in the aggregate, that will have a material adverse effect
      on
      the results of operations and financial condition of the Company.





**Related
      Party Transactions**


The
      Company purchases coffee from Landgrove Coffee Co., a related-party under
      ownership by a brother of the CEO and President of the Company. There is no
      on
      going commitment to purchase coffee from Landgrove and the Company can end
      its
      association with them at any time. As of December 31, 2006 the Company owes
      $35,444 for coffee purchases in 2006. The Company paid Landgrove $376,868 and
      $357,889 for the years ended December 31, 2006 and 2005 respectively. As
      of
      December 31, 2006, the Company had commitments to purchase whole coffee beans
      at
      a total cost of $3.69 per pound for its house & french roast blend and $3.44
      per pound for espresso and other coffee beans. Landgrove Coffees currently
      pays
      JDCO Subsidiary a rebate of forty cents per pound for all franchisee coffee
      purchases from its franchisee in the Midwest.  JDCO Subsidiary, however,
      reserves the right to earn a profit on the sale of proprietary products of
      up to
      20%.  For its fiscal year ended December 31, 2006, JDCO
      Subsidiary’s revenue from franchisee purchases and leases totaled $ 8,373 which
      represents approximately 10.45%
      of
      JDCO Subsidiary’s total revenues of $ 80,144.





**Employment
      Agreements**


The
      Company has a five year employment agreement with its chief executive officer.
      Under the agreement, he is entitled to an annual base salary of $205,900 per
      year and cash bonus to be determined by the Company, and is entitled to a
      severance of up to one year base salary if he is terminated by the Company
      without cause. The agreement automatically renews for a period of one year,
      and
      each successive year thereafter, unless the Company or employee declines to
      renew by providing written notice of such decision on the other party not less
      than 60 days before the expiration date. The agreement allows for annual cost
      of
      living increases based on the consumer price index, San Francisco,
      California.





The
      Company has a five year employment agreement with the President/Chief Operating
      Officer. Under the agreement, he is entitled to an annual base salary of
      $199,800 per year and cash bonus to be determined by the Company, and is
      entitled to a severance of up to one year base salary if he is terminated by
      the
      Company without cause. The agreement automatically renews for a period of one
      year, and each successive year thereafter, unless the Company or employee
      declines to renew by providing written notice of such decision on the other
      party not less than 60 days before the expiration date. The agreement allows
      for
      annual cost of living increases based on the consumer price index, San
      Francisco, California.





The
      Company has a five year employment agreement with its chief financial officer.
      Under the agreement, he is entitled to an annual base salary of $199,800 per
      year and cash bonus to be determined by the Company, and is entitled to a
      severance of up to one year base salary if he is terminated by the Company
      without cause. The agreement automatically renews for a period of one year,
      and
      each successive year thereafter, unless the Company or employee declines to
      renew by providing written notice of such decision on the other party not less
      than 60 days before the expiration date. The agreement allows for annual cost
      of
      living increases based on the consumer price index, San Francisco,
      California.




F-22


**JAVA
        DETOUR, INC. AND SUBSIDIARIES**
 **NOTES
        TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS**
 **DECEMBER
        31, 2006 AND 2005**




The
      Company has a two year employment agreement with an advisor. Under the
      agreement, he is entitled to an annual base salary of $84,000 per year and
      cash
      bonus to be determined by the Company, and is entitled to a severance of up
      to
      one year base salary if he is terminated by the Company without cause. The
      agreement automatically renews for a period of one year, and each successive
      year thereafter, unless the Company or employee declines to renew by providing
      written notice of such decision on the other party not less than 60 days before
      the expiration date. The agreement allows for annual cost of living increases
      based on the consumer price index, San Francisco, California.





The
      Company has a two year employment agreement with its vice president of business
      development. Under the agreement, he is entitled to an annual base salary of
      $145,000 per year and cash bonus to be determined by the Company, and is
      entitled to a severance of up to six months base salary if he is terminated
      by
      the Company without cause. The agreement automatically renews for a period
      of
      one year, and each successive year thereafter, unless the Company or employee
      declines to renew by providing written notice of such decision on the other
      party not less than 60 days before the expiration date. The agreement allows
      for
      annual cost of living increases based on the consumer price index, Charlotte,
      North Carolina.





The
      Company has a two year employment agreement with its director of business
      development. Under the agreement, he is entitled to an annual base salary of
      $120,000 per year and cash bonus to be determined by the Company and is entitled
      to a severance of up to six months base salary if he is terminated by the
      Company without cause. The agreement automatically renews for a period of one
      year, and each successive year thereafter, unless the Company or employee
      declines to renew by providing written notice of such decision on the other
      party not less than 60 days before the expiration date. The agreement allows
      for
      annual cost of living increases based on the consumer price index, Charlotte,
      North Carolina.




Future
      commitments under employment agreements are as follows:





**Base**2007
            
            $
            957,0932008
            
            
            988,2952009
            
            
            646,6792010
            
            
            667,417Thereafter
            
            
            629,734




**NOTE
      14 - SUBSEQUENT EVENTS**





On
      February 5, 2007 the Company entered into a Deposit Agreement and received
      a
      $100,000 deposit for the sale of rights to the Middle East and North Africa
      marketplaces to Java Universe, a Nevada LLC. The final agreement will be
      executed through a Master License Agreement for Java Universe to sell Java
      Detour franchises throughout the Middle East, North Africa and Switzerland
      as
      well as an option to the rights for a Master License Agreement in Vietnam.
      Java
      Universe will also receive a separate licensing agreement to license Java Detour
      products in Southern California. The final terms of the licensing agreements
      are
      being negotiated and are contingent upon all parties agreeing on the terms
      of
      the transaction.





F-23


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





Not
      applicable.





**ITEM
      8A. CONTROLS AND PROCEDURES**





**(a)
      Evaluation of disclosure controls and procedures**





As
      of
      December 31, 2006, our Chief Executive Officer and our Chief Financial Officer
      performed and evaluation of the effectiveness of and the operation of our
      disclosure controls and procedures as defined in Rule 13a-15(e) or Rule
      15d-15(e) under the Exchange Act. Based on that evaluation, our Chief Executive
      Officer and Chief Financial Officer concluded that as of December 31, 2006,
      our
      disclosure controls and procedures are effective in timely alerting them to
      material information relating to Java Detour, Inc. required to be included
      in
      our Exchange Act filings and ensuring such information is recorded, processed,
      summarized and reported within the time periods specified in the SEC rules
      and
      forms.





**(b)
      Changes in internal control over financial reporting**





On
      November 30, 2006, we entered into an Agreement and Plan of Merger (the “Merger
      Agreement”) with our wholly-owned subsidiary Java Acquisition Co., Inc. (“Merger
      Sub”) and JDCO, pursuant to which we acquired JDCO in a reverse merger
      transaction wherein Merger Sub merged with and into JDCO, with JDCO being the
      surviving corporation, and the shareholders of JDCO exchanging their shares
      of
      JDCO common stock for shares of Java Detour common stock (the “Merger”).
      Pursuant to the Merger Agreement, we issued an aggregate of 16,000,000 of our
      common stock in exchange for all of the issued and outstanding securities of
      JDCO. Following the Merger, the sole business conducted by our company is the
      business conducted by JDCO prior to the Merger, and all of the officers and
      directors of JDCO became the officers and directors of our company. Also, as
      a
      result of the Merger, the internal control over financial reporting utilized
      by
      JDCO prior to the Merger became the internal control over financial reporting
      of
      our company.





Based
      on
      the evaluation of our management as required by paragraph (d) of Rule 13a-15
      or
      15d-15 of the Exchange Act, we believe that, other then the changes described
      above, there were no changes in our internal control over financial reporting
      that occurred during the quarter ended December 31, 2006 that have materially
      affected, or are reasonably likely to materially affect, our internal control
      over financial reporting





**ITEM
      8B. OTHER INFORMATION**





Not
      applicable.





**PART
      III**




**ITEM
      9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS AND CORPORATE
      GOVERNANCE; COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE
      ACT**





The
      following individuals constitute our Board of Directors and executive management
      and were appointed to their current positions as of the close of the Merger
      on
      November 30, 2006:





**Name**
            
            **Age**
            
            **Positions**Michael
                Binninger
            
            40
            
            Chief
                Executive Officer and Chairman of the Board of
                DirectorsSteven
                Binninger
            
            39
            
            Chief
                Operating Officer, President and DirectorRonald
                Sands
            
            41
            
            Chief
                Financial Officer, Secretary and
                Director





**Michael
      Binninger** has been
      Chief Executive Officer since inception. Mr. Binninger graduated from the
      University of California Berkeley. His direct responsibilities include overall
      company strategic planning, company expansion, real estate acquisition and
      brand
      development. He oversees all site selection, lease and purchase negotiations,
      and construction of new Java Detour® locations. In 2003, Mr. Binninger led the
      creation of our joint venture agreement with First Street Ventures under which
      First Street Ventures built out five new stores. More recently he led the
      negotiations that resulted in Pavilion Development signing on to build 30 stores
      over the next 36 months in Texas, North Carolina and Florida. Mr. Binninger
      also
      led the negotiations with Focus Brands to incorporate Cinnabon Express locations
      into existing and future Java Detour® stores.




26




**Steven
      Binninger** has been
      President and Chief Operating Officer since inception. Mr. Binninger graduated
      with honors from the University of Idaho Business School. In addition to
      overseeing all store operations and quality control, he is also responsible
      for
      new store set-up and operational design, equipment selection and layout. Mr.
      Binninger develops all proprietary products and drink recipes. He directed
      the
      development of Java Detour®’s proprietary chocolate syrups to improve product
      quality and streamline beverage operations, and laid the groundwork for our
      company’s wholesale business. He also oversees all aspects of our coffee
      roasting operations.





**Ronald
      Sands** ,
      has
      been our Chief Financial Officer and Secretary since 2001. Mr. Sands graduated
      with honors from Menlo College in Atherton, California. He is responsible for
      identifying and utilizing all capital resources, in addition to directing
      financing and investing activities. Mr. Sands oversees all product pricing,
      vendor negotiations and daily accounting procedures for our company. Prior
      to
      joining us, Mr. Sands was employed by Charles Schwab and was named national
      Manager of the Year for employee development in 2000.





**Advisory
      Board**





In
      addition to the directors and executive officers listed above, the following
      individuals make significant contributions to our company as members of our
      advisory board.





**Sidney
      J. Feltenstein** and his
      partners recently acquired the restaurant chains Del Taco and Captain D’s. He is
      a board member of Focus Brands (owners of the Cinnabon brand). He was previously
      Chief Executive Officer of Yorkshire Global Restaurants, Inc. (holding company
      for A&W Restaurants, Inc. and Long John Silver's Restaurants, Inc.) before
      he helped orchestrate the sale of A&W and Long John Silver’s to Yum Foods.
      Mr. Feltenstein began his career at the Procter and Gamble Company. In 1972
      he
      joined Dunkin’ Donuts and spent 12 of his 19 years as Chief Marketing Officer.
      In 1992 he became Executive Vice President of Worldwide Marketing for the Burger
      King Corporation and is widely credited for reversing an eight year decline
      in
      customer traffic. He left Burger King in 1994 to form Yorkshire Global
      Restaurants. In 2000 Mr. Feltenstein was the recipient of the prestige’s
      International Franchise Associations Entrepreneur of the Year Award.





**Paul
      F.  Klapper** is
      currently serving as Manager for three private equity funds and has assisted
      in
      the start-up of many new businesses including one major retail coffee
      chain.  Mr. Klapper was responsible for the start-up funding and initial
      expansion capital of Pasqua Coffees of San Francisco. After receiving Mr.
      Klapper’s expansion funding, Pasqua later became and acquisition candidate and
      was eventually bought by Starbucks Coffee. Mr. Klapper served as a director
      and
      shareholder of Yorkshire Global Restaurants, which owned the brand names of
      A&W Restaurants, Inc. and Long John Silver's Restaurants, Inc. Mr. Klapper
      has been involved with a significant number of properties in San Francisco,
      Boston, Houston and other cities.  The most recent development was a Class
      A high rise office building (approximately 500,000 square feet) in downtown
      Honolulu. Most recently, Mr. Klapper and his affiliated companies, PFK
      Acquisition Company I, LLC and PFK Acquisition Group II, LLC have been involved
      as principals and advisors for the purchase of approximately $500 million in
      institutionally owned properties and companies.





**Andrew
      Cherng** as
      founder and director of Panda Express, continues to head the privately held
      company, Panda Restaurant Group. The Panda Restaurant Group operates a
      successful portfolio of restaurants including Panda Express, Panda Inn, and
      Hibachi-San. The Panda Restaurant Group is one of the largest family-owned
      restaurant chains in the world and has over 800 restaurants covering 34 states,
      Puerto Rico and Japan.





**Family
      Relationships**





Michael
      Binninger and Steven Binninger are brothers. Other than the foregoing, there
      are
      no family relationships among the individuals comprising our Board of Directors,
      management or other key personnel.




27




**Committees
      of the Board of Directors**





Our
      Board
      of Directors does not maintain a separate audit, nominating or compensation
      committee. Functions customarily performed by such committees are performed
      by
      our Board of Directors as a whole. We are not required to maintain such
      committees under the rules applicable to companies that do not have securities
      listed or quoted on a national securities exchange or national quotation system.
      We intend to charter audit, nominating and compensation committees in the near
      future.





**Director
      Compensation**





We
      did
      not and we do not currently have an established policy to provide compensation
      to members of our Board of Directors for their services in that capacity. We
      intend to develop such a policy in the near future.





**Section
      16(a) Beneficial Ownership Reporting Compliance.**





Our
      securities are currently registered under Section 12 of the Securities Exchange
      Act of 1934, as amended. As a result, and pursuant to Rule 16a-2, our directors
      and officers and holders of 10% or more of our common stock are currently
      required to file statements of beneficial ownership with regards to their
      ownership of equity securities under Sections 13 or 16 of the Exchange Act.
      O ur
      current officers, directors and beneficial holders of 10% or more of our equity
      securities became subject to such requirement and to date, b ased
      solely upon a review of Forms 3, 4 and 5 and any amendments thereto furnished
      to
      us during our most recent fiscal year, none of our officers or directors has
      failed to file on a timely basis, as disclosed in the above forms, reports
      required by Section 16(a) of the Exchange Act during the most recent fiscal
      year. However, Absolute Return Europe Fund and European Catalyst Fund, each
      holders of 10% or more of our common stock, did not file their respective Form
      3
      reflecting their acquisition of such an equity position in our company.





**Code
      of Ethics.**





As
      of
      December 31, 2006, we had not yet adopted a Code of Business Conduct and Ethics
      applicable to our principal executive officer, principal financial officer,
      principal accounting officer or controller, or persons performing similar
      functions, as there was previously a lack of perceived need for such a code
      by
      MediaUSA, and such a code was not required for JDCO. As
      of
      March 27, 2007, our Board of Directors unanimously approved a Code of Business
      Conduct and Ethics (the “Code of Ethics”) applicable to all directors, officers
      and executive employees, including our Chief Executive Officer and Chief
      Financial Officer. The purpose of the Code of Ethics is to promote honest and
      ethical conduct. The Code of Ethics is filed as Exhibit 14.1 to this Annual
      Report, and is also available in print, without charge, upon written or
      telephonic request to our headquarters. Any amendments to or waivers of the
      Code
      of Ethics will be promptly posted on our website at www.javadetour.com or in a
      report on Form 8-K, as required by applicable laws.




28




**ITEM
      10. EXECUTIVE COMPENSATION**





**Summary
      Compensation Table**





The
      following table summarizes all compensation that we have recorded in each of
      the
      last two completed fiscal years for our principal executive officer, our two
      most highly compensated executive officers other than our principal executive
      officer whose annual compensation exceeded $100,000, and up to two additional
      individuals for whom disclosure would have been made in this table but for
      the
      fact that the individual was not serving as an executive officer of our company
      at December 31, 2006 (collectively, the “Named Executive Officers”).




Name
                  and Principal Position
              
              Year
              
              Salary
              
              Bonus
              
              Option
                  Awards
              
              All
                  Other Compensation(1)
              
              TotalMichael
                  BinningerChief
                  Executive Officer and
              
              
              2006
              
              $
              95,625
              
              $
              5,000
              
              $
              234,361
              
              $
              13,808
              
              $
              348,794Chairmanof
                  the Board
              
              
              2005
              
              
              131,987
              
              
              -
              
              
              -
              
              
              7,200
              
              
              139,187Steven
                  Binninger
              
              
              2006
              
              $
              64,472
              
              $
              5,000
              
              $
              234,361
              
              $
              12,093
              
              $
              315,926Chief
                  Operating Officer
              
              
              2005
              
              
              131,984
              
              
              
              
              
              -
              
              
              7,200
              
              
              139,184Ronald
                  Sands
              
              
              2006
              
              $
              56,359
              
              $
              5,000
              
              $
              234,361
              
              $
              19,855
              
              $
              315,575Chief
                  Financial Officer
              
              
              2005
              
              
              109,945
              
              
              
              
              
              -
              
              
              7,200
              
              
              117,145


_________


(1)  Relates
      to
      annual car allowance, life and health insurance premiums





**Employment
      Agreements**





Each
      of
      Michael Binninger, Steven Binninger and Ronald Sands are parties to five-year
      employment agreements with JDCO expiring in November 2011 unless renewed upon
      mutual written consent, further to which each employee is paid an annual salary
      of $205,900, $199,800, and $199,800, respectively. Each employment agreement
      also contains a non-competition provision and provides for severance
      compensation in the event of termination without cause or upon a change of
      control. In the event that an executive officer of our company is terminated
      without cause or upon a change of control, such executive shall be entitled
      to
      receive as severance compensation his base salary at the rate payable at the
      time of such termination for a period of 12 months from the date of termination.
      Such executive shall also be entitled to accelerated vesting of any awards
      granted to the executive under our Equity Incentive Plan to the extent provided
      in the stock option agreement entered into at the time of such grant. Further,
      such executive shall be entitled to accelerated vesting of awards granted to
      the
      executive under our Equity Incentive Plan upon a change of control. In addition,
      we shall transfer to such executive all insurance policies maintained on the
      life or disability of the executive at no cost to the executive, to the extent
      that such policies permit transfer





**Option
      Grants in 2006**





Michael
      Binninger, Steven Binninger and Ronald Sands were each granted 213,055
      non-statutory stock options in accordance with the terms of the Equity Incentive
      Plan on November 30, 2006. Such options were initially unvested with each
      optionee acquiring a vested interest in 25% of the options upon the optionee’s
      completion of one year of service measured from November 30, 2006 and the
      balance of the option shares vesting in a series of 25% increments on each
      anniversary date thereafter. The options are exercisable at a price of $1.10
      and
      will expire at November 30, 2016.





The
      options are subject to accelerated vesting upon a change in control. If the
      options are to be assumed by the successor corporation (or the parent thereof)
      in connection with a change in control, then all the option shares will
      automatically vest in full on an accelerated basis so that the options will
      immediately become exercisable for all the option shares as fully vested shares
      and may be exercised for any or all of those shares as vested shares. The
      options will remain exercisable until the earlier of (1) the expiration date,
      or
      (2) the expiration of the one (1) year period measured from the date of the
      change in control.




29




**Outstanding
      Equity Awards at Fiscal Year-end**





As
      of the
      year ended December 31, 2006, the following named executive officers had the
      following unexercised options, stock that has not vested, and equity incentive
      plan awards:





Name
                and Principal Position
            Number
                of Securities
              Underlying
                Unexercised
              Options
                (#) Unexercisable (1)
            Option
                Exercise Price
            Option
                Expiration DateMichael
                Binninger
              Chief
                Executive Officer and Chairman of the Board
            213,055
            $1.10
            11/30/2016Steven
                Binninger
              Chief
                Operating Officer
            213,055
            $1.10
            11/30/2016Ronald
                Sands
              Chief
                Financial Officer
            213,055
            $1.10
            11/30/2016


_________


(1)                  
        25% vest on November 30, 2007 with the balance vesting in 25% increments
        on each
        anniversary thereafter.





**Director
      Compensation**





Name
            
            Fees
                Earned or Paid in Cash
              ($)
            
            Stock
                Awards
              ($)
            
            Option
              Awards
                ($)
            
            Non-Equity
                Incentive Plan Compensation ($)
            
            Change
                in Pension
              Value
                and Nonqualified Deferred Compensation Earnings
            
            All
                Other Compensation
              ($)
            
            Total
              ($)All
                Directors (total of 3 persons)
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -




For
      the
      year ended December 31, 2006, none of the members of our Board of Directors
      received compensation for his service as a director. We do not currently have
      an
      established policy to provide compensation to members of our Board of Directors
      for their services in that capacity. We intend to develop such a policy in
      the
      near future.





**Supplemental
      Executive Retirement Plan**





On
      October 9, 2006, our Board of Directors adopted a supplemental executive
      retirement plan through New York Life Executive Benefits, LLC (the “Retirement
      Plan”). Under the Retirement Plan, our participating employees (as designated by
      our Board of Directors) may elect to defer up to 100% or their salary and up
      to
      100% of their bonus each year; such election must be made by December 31 of
      the
      preceding year in which the salary and bonus are earned. The first year for
      which deferrals may be made is the 2007 plan year. Any deferral made by a
      participating employee will only be permitted to the extent the election is
      implemented in a manner consistent with 409A of the Internal Revenue Code,
      as
      amended. Before the beginning of each plan year, a participating employee may
      elect to have amounts which will or may be contributed or credited to his or
      her
      account for the plan year be distributed either in a lump sum or in equal
      installments beginning at a specified date, which must be at least 2 years
      after
      the end of the fiscal year of deferral. In any event, the balance in a
      participating employee’s account shall be distributed in a lump-sum in the event
      of such employee’s death or Disability (as defined in the Retirement Plan).
      Pursuant to the terms of the Retirement Plan, we currently contribute $25,000
      per quarter, beginning in the first quarter 2007.




30




**Indemnification
      of Directors And Executive Officers And Limitations of
      Liability**





Under
      Section 145 of the General Corporation Law of the State of Delaware, we can
      indemnify our directors and officers against liabilities they may incur in
      such
      capacities, including liabilities under the Securities Act of 1933, as amended
      (the “Securities Act”). Our certificate of incorporation provides that, pursuant
      to Delaware law, our directors shall not be liable for monetary damages for
      breach of the directors’ fiduciary duty of care to our company and our
      stockholders. This provision in the certificate of incorporation does not
      eliminate the duty of care, and in appropriate circumstances equitable remedies
      such as injunctive or other forms of nonmonetary relief will remain available
      under Delaware law. In addition, each director will continue to be subject
      to
      liability for breach of the director’s duty of loyalty to us or our
      stockholders, for acts or omissions not in good faith or involving intentional
      misconduct or knowing violations of the law, for actions leading to improper
      personal benefit to the director, and for payment of dividends or approval
      of
      stock repurchases or redemptions that are unlawful under Delaware law. The
      provision also does not affect a director’s responsibilities under any other
      law, such as the federal securities laws or state or federal environmental
      laws.





Our
      bylaws provide for the indemnification of our directors to the fullest extent
      permitted by the Delaware General Corporation Law. Our bylaws further provide
      that our Board of Directors has discretion to indemnify our officers and other
      employees. We are required to advance, prior to the final disposition of any
      proceeding, promptly on request, all expenses incurred by any director or
      executive officer in connection with that proceeding on receipt of an
      undertaking by or on behalf of that director or executive officer to repay
      those
      amounts if it should be determined ultimately that he or she is not entitled
      to
      be indemnified under the bylaws or otherwise. We are not, however, required
      to
      advance any expenses in connection with any proceeding if a determination is
      reasonably and promptly made by our Board of Directors by a majority vote of
      a
      quorum of disinterested Board members that (i) the party seeking an advance
      acted in bad faith or deliberately breached his or her duty to us or our
      stockholders and (ii) as a result of such actions by the party seeking an
      advance, it is more likely than not that it will ultimately be determined that
      such party is not entitled to indemnification pursuant to the applicable
      sections of our bylaws.





We
      have
      been advised that in the opinion of the Board of Directors, insofar as
      indemnification for liabilities arising under the Securities Act may be
      permitted to our directors, officers and controlling persons pursuant to the
      foregoing provisions, or otherwise, such indemnification is against public
      policy as expressed in the Securities Act and is therefore unenforceable. In
      the
      event a claim for indemnification against such liabilities (other than the
      our
      payment of expenses incurred or paid by our director, officer or controlling
      person in the successful defense of any action, suit or proceeding) is asserted
      by such director, officer or controlling person in connection with the
      securities being registered, we will, unless in the opinion of our counsel
      the
      matter has been settled by controlling precedent, submit to a court of
      appropriate jurisdiction the question of whether such indemnification by us
      is
      against public policy as expressed in the Securities Act and will be governed
      by
      the final adjudication of such issue.





We
      may
      enter into indemnification agreements with each of our directors and officers
      that are, in some cases, broader than the specific indemnification provisions
      permitted by Delaware law, and that may provide additional procedural
      protection. We have not entered into any indemnification agreements with our
      directors or officers, but may choose to do so in the future. Such
      indemnification agreements may require us, among other things, to:





·
            indemnify
                officers and directors against certain liabilities that may arise
                because
                of their status as officers or directors;




·
            advance
                expenses, as incurred, to officers and directors in connection with
                a
                legal proceeding, subject to limited exceptions; or




·
            obtain
                directors’ and officers’ insurance.




At
      present, there is no pending litigation or proceeding involving any of our
      directors, officers or employees in which indemnification is sought, nor are
      we
      aware of any threatened litigation that may result in claims for
      indemnification.




31




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





Beneficial
      ownership is determined in accordance with the rules of the SEC. In computing
      the number of shares beneficially owned by a person and the percentage of
      ownership of that person, shares of common stock subject to options and warrants
      held by that person that are currently exercisable or become exercisable within
      60 days of the date hereof are deemed outstanding even if they have not actually
      been exercised. Those shares, however, are not deemed outstanding for the
      purpose of computing the percentage ownership of any other person.





Immediately
      prior to the closing of the Private Placement and the Merger, JDCO had
      outstanding 5,401,230 shares of common stock, no outstanding shares of preferred
      stock, 2,324,165 options to purchase shares of common stock and no warrants
      to
      purchase shares of common stock. Immediately after the closing of the Private
      Placement and Merger, we had 28,327,787 issued and outstanding shares of common
      stock, no outstanding shares of preferred stock, 2,324,165 options to purchase
      shares of our common stock and 5,020,000 warrants to purchase shares of common
      stock.





The
      following table sets forth certain information with respect to beneficial
      ownership of our common stock immediately after the closing of the Merger and
      Private Placement, based on 28,327,787 issued and outstanding shares of common
      stock, by:





·
            Each
                person known to be the beneficial owner of 5% or more of our outstanding
                common stock;


·
            Each
                executive officer;


·
            Each
                director; and


·
            All
                of the executive officers and directors as a
                group.





Unless
      otherwise indicated, the persons and entities named in the table have sole
      voting and sole investment power with respect to the shares set forth opposite
      the stockholder’s name, subject to community property laws, where applicable.
      Unless otherwise indicated, the address of each stockholder listed in the table
      is c/o Java Detour, Inc., 2121 Second Street, Building C, Suite 105, Davis,
      California, 95618.





**Name
                and Address of**
              **Beneficial
                Owner**
            **Title**
            **Beneficially
                Owned**
              **Post-Merger**
            **Percent
                of Class*****Directors
                and Officers:***Michael
                Binninger
            Chief
                Executive Officer and Chairman of the Board of Directors
            3,474,465
            12.3%Steven
                Binninger
            Chief
                Operating Officer, President and Director
            3,474,465
            12.3%Ronald
                Sands
            Chief
                Financial Officer, Secretary and Director
            1,974,463
            7.0%All
                executive officers and directors as
              a
                group (3 persons)
            
            8,923,393
            31.5%***Five
                Percent Shareholders:***Absolute
                Return Europe Fund
              c/o
                Hunter World Markets, Inc.
              9300
                Wilshire Blvd. Penthouse Suite
              Beverly
                Hills, CA 90212
            
            4,375,000
                (1)
            15.0%




32




European
                Catalyst Fund
              c/o
                Hunter World Markets, Inc.
              9300
                Wilshire Blvd. Penthouse Suite
              Beverly
                Hills, CA 90212
            
            3,125,000
                (2)
            10.8%Absolute
                Octane Fund
              c/o
                Hunter World Markets, Inc.
              9300
                Wilshire Blvd. Penthouse Suite
              Beverly
                Hills, CA 90212
            
            2,500,000
                (3)
            8.7%Hunter
                World Markets, Inc.
              9300
                Wilshire Blvd. Penthouse Suite
              Beverly
                Hills, CA 90212
            
            2,418,403
                (4)
            8.4%Absolute
                German Fund
              c/o
                Hunter World Markets, Inc.
              9300
                Wilshire Blvd. Penthouse Suite
              Beverly
                Hills, CA 90212
            
            1,875,000
                (5)
            6.5%Paul
                F. Klapper
              160
                Spear Street, Suite #230
              San
                Francisco, CA 94105
            
            1,737,006
                (6)
            6.1%


**______________**


(1) As
      Chief
      Investment Officer and control person of Absolute Return Europe Fund, Florian
      Homm may be deemed to have voting and investment powers for the shares held
      by
      the foregoing funds. Mr. Homm disclaims beneficial ownership of the shares
      held
      by foregoing funds except to the extent of his proportionate pecuniary interest
      therein.





(2)
      As
      control person of European Catalyst Fund, Peter Irblad may be deemed to have
      voting and investment powers for the shares held by the foregoing funds. Mr.
      Irblad disclaims beneficial ownership of the shares held by foregoing funds
      except to the extent of his proportionate pecuniary interest
      therein.





(3)
      As
      control person of Absolute Octane Fund, Jens Peters may be deemed to have voting
      and investment powers for the shares held by the foregoing funds. Mr. Peters
      disclaims beneficial ownership of the shares held by foregoing funds except
      to
      the extent of his proportionate pecuniary interest therein.





(4)
      This
      amount includes (i) 1,918,403 shares of our common stock owned by Hunter World
      Markets, Inc. (“Hunter”) and its affiliates and (ii) warrants issued to Hunter
      currently exercisable into 500,000 shares of our common stock, but excludes
      2,000,000 warrants issued to Hunter further to the Private Placement which
      are
      not exercisable until September 1, 2007, nine months from the date of issuance.
      Todd Ficeto is President, Chief Executive Officer, and control person of Hunter
      and may be deemed to have voting and investment power over the shares held
      by
      Hunter. Mr. Ficeto disclaims beneficial ownership of the shares held by Hunter
      except to the extent of his pecuniary interest therein.





(5)
      As
      control person of Absolute German Fund, Frank Siebrecht may be deemed to have
      voting and investment powers for the shares held by the foregoing funds. Mr.
      Siebrecht disclaims beneficial ownership of the shares held by the foregoing
      funds except to the extent of his proportionate pecuniary interest
      therein.





(6)
      This
      amount includes (i) 667,638 shares of our common stock owned by Paul F. Klapper,
      (ii) 89,396 shares of our common stock owned by PFK Development Group Ltd.,
      a
      corporation for which Mr. Klapper is the sole shareholder, (iii) 498,677 shares
      of our common stock owned by Clydesdale Partners LLC, a partnership for which
      Mr. Klapper is one of two managers, and (iv) 481,298 shares of our common stock
      owned by The Klapper Family Trust, a trust for which Mr. Klapper is the trustee.
      As control person of PFK Development Group Ltd., Clydesdale Partners LLC and
      The
      Klapper Family Trust, Mr. Klapper may be deemed to have voting and investment
      powers for the shares held by the foregoing entities. Mr. Klapper disclaims
      beneficial ownership of the shares held by the foregoing entities except to
      the
      extent of his proportionate pecuniary interest therein.





**ITEM
      12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
      INDEPENDENCE**





**Interlocking
      Directorships**





Upon
      closing of the Merger, JDCO became our wholly-owned subsidiary; we have
      interlocking executive and director positions with JDCO.




33




**Director
      Independence**





As
      we are
      quoted on Pink Sheets and not one of the national securities exchanges, we
      are
      not subject to any director independence requirements. None of our present
      directors qualifies as an independent director pursuant to Rule 10A-3
      promulgated under the Exchange Act due to their affiliation with us as
      employees.





**Reverse
      Merger**





On
      November 30, 2006, we entered into the Merger Agreement with Merger Sub and
      JDCO, pursuant to which we acquired JDCO in a reverse merger transaction wherein
      Merger Sub merged with and into JDCO, with JDCO being the surviving corporation,
      and the shareholders of JDCO exchanging their shares of JDCO common stock for
      shares of our common stock on a 1-for-2.962 basis. The Merger closed on November
      30, 2006 and JDCO became our wholly-owned subsidiary. As of the close of the
      Merger, Michael Binninger, Steven Binninger and Ronald Sands collectively own
      31.5% of our issued and outstanding stock. Michael Binninger, Steven Binninger
      and Ronald Sands are officers and directors of JDCO.





We
      were
      originally incorporated in the State of Nevada on September 24, 1999. We had
      planned to operate as an internet based mortgage brokerage company, offering
      customers a convenient and efficient way to show for a new mortgage or refinance
      and existing mortgage. However, due to various licensing-related and other
      issues, we determined that we were not likely to be successful in the online
      mortgage brokerage business given our existing resources. At this time, we
      began
      assessing other business opportunities and eventually became aware of a business
      opportunity presented by JDCO, an unrelated private company. We began to
      consider and discuss the possibility of a business combination between our
      company and the shareholders of JDCO. Ultimately, we effected the Merger for
      various reasons, including:





·
            access
                to the public capital markets;


·
            the
                increased market liquidity expected to result from exchanging stock
                in a
                private company for securities of a public company that may eventually
                be
                traded;


·
            the
                ability to use registered securities to make acquisition of assets
                or
                businesses;


·
            increased
                visibility in the financial
                community;


·
            enhanced
                access to the capital markets;


·
            improved
                transparency of operations; and


·
            perceived
                credibility and enhanced corporate image of being a publicly traded
                company.





After
      the
      Merger was concluded, we immediately reincorporated from the State of Nevada
      to
      the State of Delaware further to an 8-for-1 exchange ratio and changed our
      corporate name from Media USA.com, Inc. to Java Detour, Inc.





**First
      Street Ventures LLC and the Company**





We
      were
      parties to a Development Agreement with First Street Ventures dated October
      14,
      2003 (as amended, the “Development Agreement”), whereby First Street Ventures
      developed five turn-key stores under the Java Detour® brand during the 3-yr term
      of the Development Agreement. Pursuant to the terms of the Development Agreement
      and prior to the closing of the Merger, First Street Ventures received 295,455
      shares of JDCO common stock from Michael Binninger, Steven Binninger and Ronald
      Sands as partial consideration for services provided therein; upon closing
      of
      the Merger, such shares were exchanged for 875,223 hares of Java Detour, Inc.
      common stock. For each store that First Street Ventures developed in connection
      with the Development Agreement, First Street Ventures formed an LLC (each,
      a
“Project Entity”) to acquire the land and develop each such store, serving as
      the general partner for the Project Entity until completion and delivery of
      the
      store to our company. Upon the formation of each Project Entity, First Street
      Ventures issued membership interests constituting a 15% interest in such Project
      Entity to our other shareholders. Upon completion of each store developed by
      the
      Project Entities, First Street Ventures then sold each such Project Entity
      to an
      unrelated third party, such third party acquiring the land and developed store
      thereby becoming our landlord for that particular store. For its services
      rendered pursuant to the Development Agreement, First Street Ventures did not
      receive any consideration from us beyond the shares of our common stock and
      the
      85% membership interest in each Project Entity.




34




Although
      we currently do not have an agreement with First Street Ventures to develop
      any
      stores, First Street Ventures is one of our preferred developers and we may
      enter into future agreements to build more stores with them. We
      believe that the Development Agreement was at fair market value and was on
      terms
      comparable to those that would have been reached in arms’ length negotiations
      had the parties been unaffiliated at the time of the negotiations.





**Retail
      Store Acquisitions and Dispositions**





Java
      Detour, LLC (predecessor in interest to JDCO) acquired our Citrus Heights store
      location from Steven Binninger pursuant to an Asset Purchase Agreement dated
      as
      of June 26, 2002 (the “Citrus Heights Agreement”). The terms of the Citrus
      Heights Agreement provided for a purchase price of $325,000, paid in part with
      a
      seven-year promissory note (the “Citrus Heights Note”) for the principal amount
      of $245,000 and secured by the Citrus Heights store location. The Citrus Heights
      Note was made on July 22, 2002 and accrued interest at a rate of 10% per annum.
      Immediately after the closing of the Merger, we paid off the principal amount
      outstanding on the Citrus Heights Note. We believe that the agreement to acquire
      the Citrus Heights store was at fair market value and was on terms comparable
      to
      those that would have been reached in arms’ length negotiations had the parties
      been unaffiliated at the time of the negotiations.





**Loan
      Agreements**





In
      January 2006, First Street Ventures made a loan to us guaranteed by Michael
      Binninger, Steven Binninger, and Ronald Sands, in the principal amount of
      $350,000 evidenced by a promissory note with interest accruing at a rate of
      8%
      per annum. In October 2006, First Street Ventures entered into a Note Conversion
      Agreement with JDCO, whereby First Street Ventures agreed to accept 51,775
      shares of JDCO’s common stock as partial satisfaction of JDCO’s obligations
      under the First Street note, thereby reducing the principal amount outstanding
      under the First Street note to $175,000. Immediately after the closing of the
      Merger, we paid the principal amount of $175,000 still outstanding under the
      First Street note to First Street Ventures.





Pursuant
      to a promissory note dated September 19, 2006 and maturing on July 1, 2007,
      Summit Bank extended a line of credit to us in the principal amount of
      $1,500,000, guaranteed by Michael Binninger, Steven Binninger, Paul F. Klapper
      and the Klapper Family Trust, each shareholders of our company. In consideration
      for the Klapper Family Trust’s and Paul F. Klapper’s guaranty of the Summit Bank
      line of credit, we agreed to (i) pay Paul F. Klapper $2,000 per month for 60
      months beginning in August 2004; (ii) issue to the Klapper Family Trust warrants
      to acquire up to 72,072 shares of our common stock at an exercise price of
      $3.38
      per share at any time within six years, such warrants exercised by the PFK
      Development Group Ltd. in October 2006; and (iii) execute a promissory note
      in
      favor of PFK Development Group Ltd. in the principal amount of $120,000, such
      note converted into 30,178 shares of JDCO’s common stock further to the Merger
      as satisfaction in full of JDCO’s obligations under the note.





In
      addition to guaranteeing the First Street note and Summit Bank line of credit,
      Michael Binninger and Steven Binninger also guaranteed several equipment and
      property leases entered into by our company.





In
      connection with an Agreement for the Purchase and Sale of Stock dated as of
      June
      7, 2002, whereby Java Detour LLC, the predecessor in interest to JDCO, acquired
      from Michael Binninger and Steven Binninger all of their stock in Java Detour,
      a
      California corporation, JDCO executed two promissory notes, each dated June
      7,
      2002, in favor of Steven Binninger and Michael Binninger, respectively. The
      promissory notes were each made in the principal amount of $325,815, accruing
      interest at 10% per annum and due and payable on June 7, 2012. On October 11,
      2006, JDCO entered into a Satisfaction Agreement for Promissory Notes with
      Michael Binninger and Steven Binninger, whereby Michael Binninger and Steven
      Binninger each agreed to accept $130,000 cash and 57,786 shares of JDCO’s common
      stock as satisfaction in full of JDCO’s obligations under the promissory notes.
      Such cash was paid to Michael Binninger and Steven Binninger upon the closing
      of
      the Merger.





We
      believe that our loan arrangements are at fair market value and are on terms
      comparable to those that would have been reached in arms’ length negotiations
      had the parties been unaffiliated at the time of the negotiations.




35




**Java
      Detour Licensing Agreement**





Pursuant
      to a Master Licensing Agreement (the “Java Detour Licensing Agreement”) dated as
      of August 1, 2002, JDCO granted Java Detour, a California corporation (“JDCO
      Sub”), an exclusive license to open and operate Java Detour® stores and to
      franchise others to do so as well. In June 2002, JDCO acquired all of the issued
      and outstanding stock in JDCO Sub and JDCO Sub became a wholly-owned subsidiary
      of JDCO. The term of the Java Detour Licensing Agreement is 10 years and JDCO
      Sub has the option to renew for two successive terms of 10 years each by written
      notice not less than 90 days prior to expiration. JDCO Sub currently pays JDCO
      a
      royalty equal to 75% of gross revenues received each month in connection with
      the Java Detour Licensing Agreement. We believe that our Java Detour Licensing
      Agreement is at fair market value and is on terms comparable to those that
      would
      have been reached in arms’ length negotiations had the parties been unaffiliated
      at the time of the negotiations.





**Hunter
      World Markets, Inc. and the Company**





In
      November 2006, Hunter World Markets, Inc. (“Hunter”) acquired 1,125,000 shares
      of our common stock from our then controlling stockholder for $225,000, said
      shares representing approximately 92.3% of our outstanding common stock prior
      to
      the Merger.




On
      August
      30, 2006, JDCO executed a Term Credit Agreement with The Hunter Fund Limited,
      an
      affiliated entity of Hunter, for a $500,000 term loan (the “Bridge Financing”).
      In connection with the Bridge Financing, JDCO paid the Hunter Fund a bridge
      loan
      fee of $60,000 and a flat interest payment of $50,000. In addition, JDCO issued
      Hunter five-year warrants to purchase 500,000 shares of common stock at a per
      share exercise price of $0.60. The Bridge Financing was repaid with a portion
      of
      the proceeds of the Private Placement.




For
      its
      services as the placement agent, Hunter was paid a fee equal to 10% of the
      gross
      proceeds from the Private Placement. In addition, in conjunction with the
      Merger, Hunter earned five-year warrants to purchase 2,000,000 shares of common
      stock, exercisable nine months from the date of issuance at the same per share
      price of the warrants sold in the Private Placement. Further to the Private
      Placement and Merger, we also issued Hunter 793,403 shares of common stock
      for
      consulting services rendered. Upon the closing of the Merger and the Private
      Placement, Hunter and its affiliates beneficially own 2,418,403 shares
      of
      our common stock or approximately 8.4% of the common stock outstanding, which
      excludes shares underlying the 2,000,000 warrants issued to Hunter further
      to
      the Private Placement.





We
      believe that our arrangements with Hunter are at fair market value and are
      on
      terms comparable to those that would have been reached in arms’ length
      negotiations had the parties been unaffiliated at the time of the
      negotiations.





**Landgrove
      Coffee Co.**





We
      currently purchase all of our coffee beans from Landgrove Coffee Co., a company
      co-owned by John Binninger, brother of Michael Binninger and Steven Binninger,
      our Chief Executive Officer and Chief Operating Officer, respectively. We have
      an oral agreement for pricing for each 50,000 pounds purchased whereby we
      purchase whole coffee beans at the agreed upon price per pound on a net 30
      basis. We do not have a binding commitment to purchase coffee from Landgrove
      Coffee and we can end our association with Landgrove Coffee at any time. We
      paid
      Landgrove Coffee $376,868
      and $357,889 for the years ended December 31, 2006 and 2005, respectively.
      As of
      December 31, 2006, we
      had
      commitments from Landgrove Coffee to sell us whole coffee beans at a total
      cost
      of $3.69 per pound for our house & french roast blend and $3.44 per pound
      for espresso and other coffee beans. Additionally, Landgrove Coffee currently
      pays JDCO Subsidiary a rebate of $0.40 per pound for all coffee purchases from
      our franchisees in the Midwest.





Although
      we currently purchase our coffee exclusively from Landgrove Coffee, we have
      relationships with other roasters who are capable of supplying us with our
      coffee beans. We
      believe that our agreement with Landgrove Coffee is at fair market value and
      is
      on terms comparable to those that would have been reached in arms’ length
      negotiations had the parties been unaffiliated at the time of the
      negotiations.




36




**ITEM
      13. EXHIBITS**





**Exhibit**
              **Number**
            **Description
                of Exhibit**2.1
            Merger
                Agreement dated November 30, 2006 by and among the Registrant (f/k/a
                Media
                USA.com, Inc.), Java Acquisition Sub Co. and JDCO, Inc. (incorporated
                by
                reference to Exhibit 2.1 to the Registrant’s Form 10-SB filed with the SEC
                on December 8, 2006)3.1
            Certificate
                of Incorporation of the Registrant (incorporated by reference to
                Exhibit
                3.1 to the Registrant’s Form 10-SB filed with the SEC on December 8,
                2006)3.2
            By-Laws
                of the Registrant of the Registrant (incorporated by reference to
                Exhibit
                3.2 to the Registrant’s Form 10-SB filed with the SEC on December 8,
                2006)3.3
            Certificate
                of Merger Effecting Reincorporation and Name Change (incorporated
                by
                reference to Exhibit 3.3 to the Registrant’s Form 10-SB filed with the SEC
                on December 8, 2006)4.1
            Form
                of Investor Warrant (incorporated by reference to Exhibit 4.1 to
                the
                Registrant’s Form 10-SB filed with the SEC on December 8,
                2006)4.2
            Share
                Registration Rights Agreement dated November 30, 2006 (incorporated
                by
                reference to Exhibit 4.2 to the Registrant’s Form 10-SB filed with the SEC
                on December 8, 2006)4.3
            Warrant
                Share Registration Rights Agreement dated November 30, 2006 (incorporated
                by reference to Exhibit 4.3 to the Registrant’s Form 10-SB filed with the
                SEC on December 8, 2006)4.4
            Form
                of Placement Agent Warrant (incorporated by reference to Exhibit
                4.4 to
                the Registrant’s Form 10-SB filed with the SEC on December 8,
                2006)4.5
            Specimen
                Common Stock Certificate of Registrant (Incorporated by reference
                to
                Exhibit 4.5 to Registrant’s Form SB-2 filed with the SEC on December 29,
                2006)10.1
            Securities
                Purchase Agreement dated November 30, 2006 (incorporated by reference
                to
                Exhibit 10.1 to the Registrant’s Form 10-SB filed with the SEC on December
                8, 2006)10.2
            Lease
                Agreement dated September 16, 2005 (incorporated by reference to
                Exhibit
                10.2 to the Registrant’s Form 10-SB filed with the SEC on December 8,
                2006)10.3
            Term
                Credit Agreement dated August 30, 2006 by and between JDCO, Inc.
                and The
                Hunter Fund Limited (incorporated by reference to Exhibit 10.3 to
                the
                Registrant’s Form 10-SB filed with the SEC on December 8,
                2006)10.4
            Employment
                Agreement dated November 27, 2006 by and between Michael Binninger
                and
                JDCO, Inc. (incorporated by reference to Exhibit 10.4 to the Registrant’s
                Form 10-SB filed with the SEC on December 8, 2006)10.5
            Employment
                Agreement dated November 27, 2006 by and between Steven Binninger
                and
                JDCO, Inc. (incorporated by reference to Exhibit 10.5 to the Registrant’s
                Form 10-SB filed with the SEC on December 8, 2006)10.6
            Employment
                Agreement dated November 27, 2006 by and between Ronald Sands and
                JDCO,
                Inc. (incorporated by reference to Exhibit 10.6 to the Registrant’s Form
                10-SB filed with the SEC on December 8, 2006)




37




**Exhibit**
              **Number**
            **Description
                of Exhibit**


10.7
            Placement
                Agent Agreement dated August 30, 2006 by and between JDCO, Inc. and
                Hunter
                World Markets, Inc. (incorporated by reference to Exhibit 10.7 to
                the
                Registrant’s Form 10-SB filed with the SEC on December 8,
                2006)10.8
            2006
                Equity Incentive Plan of the Registrant (incorporated by reference
                to
                Exhibit 10.8 to the Registrant’s Amendment No. 1 to Form 10-SB filed with
                the SEC on February 14, 2007)10.9
            Form
                of Notice of Grant of Stock Option of the Registrant (incorporated
                by
                reference to Exhibit 10.9 to the Registrant’s Form 10-SB filed with the
                SEC on December 8, 2006)10.10
            Form
                of Stock Option Agreement (including Addendum) of the Registrant
                (incorporated by reference to Exhibit 10.10 to the Registrant’s Form 10-SB
                filed with the SEC on December 8, 2006)10.11
            Form
                of Stock Issuance Agreement (including Addendum) of the Registrant
                (incorporated by reference to Exhibit 10.11 to the Registrant’s Form 10-SB
                filed with the SEC on December 8, 2006)10.12
            Form
                of Stock Purchase Agreement (including Addendum) of the Registrant
                (incorporated by reference to Exhibit 10.12 to the Registrant’s Form 10-SB
                filed with the SEC on December 8, 2006)10.13
            Development
                Agreement (as amended) dated October 13, 2003 by and between JDCO,
                Inc.
                and First Street Ventures, LLC10.14
            Development
                Agreement dated August 11, 2006 by and between JDCO, Inc. and Pavilion
                Development Company14.1
            Java
                Detour, Inc. Code of Business Conduct and Ethics, adopted March 27,
                200716.1
            Letter
                from Spector & Wong, LLP dated December 8, 2006 to the Securities and
                Exchange Commission (incorporated by reference to Exhibit 16.1 to
                the
                Registrant’s Form 10-SB filed with the SEC on December 8,
                2006)21.1
            List
                of Subsidiaries of Registrant (incorporated by reference to Exhibit
                21.1
                to the Registrant’s Form 10-SB filed with the SEC on December 8,
                2006)31.1
            Certification
                of the Chief Executive Officer pursuant to Exchange Act Rule
                13a-14(a)31.2
            Certification
                of the Chief Financial Officer pursuant to Exchange Act Rule
                13a-14(a)32.1
            Certification
                pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of
                the
                Sarbanes Oxley Act of 200299.1
            Press
                Release dated December 5, 2006 (incorporated by reference to Exhibit
                99.1
                to the Registrant’s Form 10-SB filed with the SEC on December 8,
                2006)




38




**ITEM
      14. PRINCIPAL ACCOUNTANT FEES AND SERVICES**





AJ.
      Robbins, PC ,
      has
      provided audit services for us for the 2005 and 2006 fiscal years:





**2006
                Fees**
            
            **2005
                Fees**Audit
                Fees(1)
            
            $
            50,000
            
            $
            105,000Audit-Related
                Fees(2)
            
            
            -
            
            
            -Tax
                Fees(3)
            
            $
            10,000
            
            
            -All
                Other Fees(4)
            
            $
            14,259
            
            
            -Total
            
            $
            74,259
            
            $
            105,000








(1)  “Audit
      Fees” consist of fees billed for professional services rendered for the audit of
      Java Detour, Inc.’s annual financial statements for the years ended December 31,
      2006 and 2005, and for the review of our interim financial statements and
      services performed during 2006. We paid $95,000 for the audit of our financial
      statements for the year ended December 31, 2005, and $10,000 for the review
      of
      our interim financial statements included in the registration statement on
      Form
      10-SB filed December 8, 2006. We estimate that we have incurred approximately
      $50,000 in fees for the audit of our financial statements for the year ended
      December 31, 2006.





(2)  “Audit-Related
      Fees” consist of fees billed for professional services rendered by AJ. Robbins,
      PC, for the years ended December 31, 2006 and 2005 reasonably related to the
      performance of the audit review that are not otherwise reported under Audit
      Fees. The Company did not incur any Audit-Related Fees for the fiscal years
      ended December 31, 2006 and 2005.





(3)  “Tax
      Fees”
consist of fees billed for professional services rendered by AJ Robbins, PC,
      for
      services rendered in connection with tax compliance, tax advice and tax
      planning. The Company paid approximately $10,000 in Tax Fees for the year ended
      December 31, 2006. The Company did not incur any Tax Fees For the year ended
      December 31, 2005.





(4)  “All
      Other
      Fees” consist of fees billed for professional services rendered by AJ. Robbins,
      PC, for services rendered that are not otherwise reported above. For the year
      ended December 31, 2006, the Company paid $14,259 for services rendered in
      connection with the review of our Current Form 8-K filed on December 8, 2006
      and
      travel-related costs. The Company did not incur any Other Fees for the year
      ended December 31, 2005.





**Pre-Approval
      Policy**





From
      inception to date, we have not had an audit committee. Our Board of Directors
      as
      a whole pre-approves all services provided by AJ. Robbins, PC. Prior to the
      engagement of AJ. Robbins, PC, for any non-audit or non-audit related services,
      the Board of Directors must conclude that such services are compatible with
      the
      independence of AJ. Robbins, PC, as our auditors.




39




**SIGNATURES**





Pursuant
      to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
      1934, the Registrant has duly caused this report to be signed on its behalf
      by
      the undersigned, thereunto duly authorized, in the City of Davis, State of
      California, on April 2, 2007.




JAVA DETOUR, INC./s/
                Michael Binninger
              
              Michael
                Binninger
              Chief
                Executive Officer and Chairman of the Board
              (Principal
                Executive Officer)/s/ Ronald Sands
              
              Ronald
                Sands
              Chief
                Financial Officer
              (Principal
                Financial Officer)





Pursuant
      to the requirements of the Securities Exchange Act of 1934, this report has
      been
      signed by the following persons on behalf of the Registrant and in the
      capacities and on the dates indicated.





SIGNATURE
            
            TITLE
            
            DATE/s/
                Michael Binninger
            
            Chief
                Executive Officer and Chairman of the Board
            
            April
                2, 2007/s/
                Ronald Sands
            
            Chief
                Financial Officer
            
            April
                2, 2007/s/
                Steven Binninger
            
            Chief
                Operating Officer
            
            April
                2, 2007




40