<PAGE>

                UNITED STATES SECURITIES AND EXCHANGE COMMISSION

                              WASHINGTON, DC 20549

                                    FORM 10-Q

             Quarterly Report Pursuant to Section 13 or 15(d) of the
                        Securities Exchange Act of 1934


                        For Quarter Ended: June 30, 2007


                        Commission File Number: 000-28027


                         GLOBAL BEVERAGE SOLUTIONS, INC.
                         -------------------------------
             (Exact name of registrant as specified in its charter)


              Nevada                                       90-0093439
              ------                                       ----------
     (State or Jurisdiction of                        (IRS Employer ID No)
  Incorporation or Organization)

              2 S. University Dr., Suite 220, Plantation, FL 33324
              ----------------------------------------------------
               (Address of principal executive office) (Zip code)


                                 (954) 473-0850
                                 --------------
                           (Issuer's telephone number)


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

Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, or a non-accelerated filer. See definition of "accelerated
filer and large accelerated filer" in Rule 12b-2 of the Exchange Act. (Check
one):

   Large accelerated filer [ ] Accelerated filer [ ] Non-accelerated filer [X]

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

The number of shares outstanding of registrant's common stock, par value $.001
per share, as of June 30, 2007 was 147,267,501 shares.

<PAGE>

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                                      Global Beverage Solutions, Inc.

                                                   INDEX

                                                                                                      Page
                                                                                                       No.
                                                                                                       ---

Part I         Financial Information

      Item 1:  Condensed Financial Statements

               Statements of Net Assets as of June 30, 2007 and December 31, 2006                      3
               Statements of Operations - For the Three Months Ended June 30, 2007 and 2006            4
               Statements of Operations - For the Six Months Ended June 30, 2007 and 2006              5
               Statements of Cash Flows - For the Six Months Ended June 30, 2007 and 2006              6
               Statements of Changes in Net Assets - For the Six Months Ended June 30, 2007
               and 2006                                                                                7
               Financial Highlights - For the Six Months Ended June 30, 2007 and 2006                  8
               Schedule of Investments as of June 30, 2007 and December 31, 2006                     9-10
               Notes to Financial Statements                                                         11-23
      Item 2:  Management's Discussion and Analysis of Financial Condition and Results of
               Operations                                                                            24-28
      Item 3:  Quantitative and Qualitative Disclosure about Market Risk                              29
      Item 4:  Controls and Procedures                                                                29

Part II        Other Information                                                                     30-33

      Item 1:  Legal Proceedings
      Item 1A: Risk Factors
      Item 2:  Unregistered Sales of Equity Securities and Use of Proceeds
      Item 3:  Defaults Upon Senior Securities
      Item 4:  Submission of Matters to a Vote of Security Holders
      Item 5:  Other Information
      Item 6:  Exhibits
      Signatures
      Exhibits


                                                    2
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<TABLE>
<S>     <C>

PART 1:  FINANCIAL INFORMATION
ITEM 1:  FINANCIAL STATEMENTS

                                  GLOBAL BEVERAGE SOLUTIONS, INC.
                                 Condensed Statements of Net Assets
                                June 30, 2007 and December 31, 2006

                                                                          2007            2006
                                                                      ------------    ------------
                                                                      (Unaudited)

ASSETS
Investments in portfolio companies:
  Controlled affiliates (cost $14,898,181 at June 30, 2007 and
     $6,669,760 at December 31, 2006)                                 $ 14,898,181    $  1,575,000
  Non-controlled affiliate (cost $8,314,543 at June 30, 2007 and
     $1,011,500 at December 31, 2006                                       550,000               -
  Unaffiliated issuers (cost $200,000 at June 30, 2007 and
     December 31, 2006)                                                          -               -
                                                                      ------------    ------------
     Total investments                                                  15,448,181       1,575,000
Cash and cash equivalents                                                    1,863             472
Deposits and prepaid expenses                                               11,682             474
Office equipment, net                                                        1,519               -
                                                                      ------------    ------------
  TOTAL ASSETS                                                          15,463,245       1,575,946
                                                                      ------------    ------------

LIABILITIES
  Notes payable (Note 3)                                                 4,246,169       1,335,000
  Accounts payable                                                          68,163         103,486
  Accrued expenses                                                         253,170          48,064
                                                                      ------------    ------------
  TOTAL LIABILITIES                                                      4,567,502       1,486,550
                                                                      ------------    ------------
NET ASSETS                                                            $ 10,895,743    $     89,396
                                                                      ============    ============

Commitments and contingencies (Note 5)

Composition of net assets:
  Preferred stock, $.001 par value; 50,000,000 shares
     authorized; no shares issued and outstanding                     $          -    $          -
  Common stock, $.0001 par value, authorized 950,000,000 shares;
    147,267,501 and 43,665,067 shares issued and outstanding at
     June 30, 2007 and December 31, 2006, respectively                     147,267          43,665
  Additional paid in capital                                            30,473,262      17,130,808
  Stock subscription receivable                                           (273,450)              -
  Deferred option compensation                                             (80,899)       (121,349)
  Accumulated deficit:
    Accumulated net operating loss                                      (9,527,479)     (8,779,053)
    Net realized loss on investments                                    (1,878,415)     (1,878,415)
    Net unrealized depreciation of investments                          (7,964,543)     (6,306,260)
                                                                      ------------    ------------
Net assets                                                            $ 10,895,743    $     89,396
                                                                      ============    ============
Net asset value per share                                             $     0.0740    $     0.0020
                                                                      ============    ============

See accompanying notes to condensed financial statements.


                                                 3
<PAGE>

                                     GLOBAL BEVERAGE SOLUTIONS, INC.
                                   Condensed Statements of Operations
                                Three Months Ended June 30, 2007 and 2006
                                               (Unaudited)

                                                                              2007             2006
                                                                         -------------    -------------
Income from operations:
  Interest income from controlled affiliates                             $           -    $      22,399
  Interest income from non-controlled affiliates                                     -           10,131
  Management income from non-controlled affiliates                                   -            6,000
                                                                         -------------    -------------
                                                                                     -           38,530
                                                                         -------------    -------------

Expenses:
  Officer and employee compensation and benefits                                79,526           37,500
  Professional fees                                                            104,874          120,857
  Shareholder services and communications                                        7,565            1,920
  Interest expense                                                             148,887                -
  Amortization of intrinsic value of common stock options                       20,225                -
  Rent and utilities                                                            13,557            3,000
  Lawsuit settlement                                                                 -           78,000
  Other general and administrative expense                                      17,933           10,222
                                                                         -------------    -------------
                                                                               392,567          251,499
                                                                         -------------    -------------
Loss before income taxes and realized and unrealized losses                   (392,567)        (212,969)
  Income taxes                                                                       -                -
                                                                         -------------    -------------
Net loss from operations                                                      (392,567)        (212,969)
                                                                         -------------    -------------

Net realized and unrealized losses:
  Net realized loss on investments, net of income tax benefits of $0                 -                -
  Change in unrealized depreciation of portfolio investments, net
     of deferred tax benefit of $0                                          (1,658,283)               -
                                                                         -------------    -------------
          Net realized and unrealized losses                                (1,658,283)               -
                                                                         -------------    -------------
Net decrease in net assets from operations                               $  (2,050,850)   $    (212,969)
                                                                         =============    =============

Net decrease in net assets from operations per share, basic
     and diluted                                                         $     (0.0139)   $     (0.0049)
                                                                         =============    =============

Weighted average shares outstanding                                        147,267,501       43,557,676
                                                                         =============    =============

See accompanying notes to condensed financial statements.


                                                    4
<PAGE>

                                     GLOBAL BEVERAGE SOLUTIONS, INC.
                                   Condensed Statements of Operations
                                 Six Months Ended June 30, 2007 and 2006
                                               (Unaudited)

                                                                              2007             2006
                                                                         -------------    -------------
Income from operations:
  Interest income from controlled affiliates                             $           -    $      23,656
  Interest income from non-controlled affiliates                                     -           12,310
  Management income from non-controlled affiliates                                   -           12,000
                                                                         -------------    -------------
                                                                                     -           47,966
                                                                         -------------    -------------

Expenses:
  Officer and employee compensation and benefits                               130,730           75,000
  Director fees                                                                  3,000            1,500
  Professional fees                                                            287,944          187,700
  Shareholder services and communications                                       25,180            5,240
  Interest expense                                                             214,929                -
  Amortization of intrinsic value of common stock options                       40,450                -
  Rent and utilities                                                            19,417            6,000
  Lawsuit settlement                                                                 -           78,000
  Other general and administrative expense                                      26,776           13,707
                                                                         -------------    -------------
                                                                               748,426          367,147
                                                                         -------------    -------------
Loss before income taxes and realized and unrealized losses                   (748,426)        (319,181)
  Income taxes                                                                       -                -
                                                                         -------------    -------------
Net loss from operations                                                      (748,426)        (319,181)
                                                                         -------------    -------------

Net realized and unrealized losses:
  Net realized loss on investments, net of income tax benefits of $0                 -                -
  Change in unrealized depreciation of portfolio investments, net
     of deferred tax benefit of $0                                          (1,658,283)               -
                                                                         -------------    -------------
          Net realized and unrealized losses                                (1,658,283)               -
                                                                         -------------    -------------
Net decrease in net assets from operations                               $  (2,406,709)   $    (319,181)
                                                                         =============    =============

Net decrease in net assets from operations per share, basic
     and diluted                                                         $     (0.0208)   $     (0.0075)
                                                                         =============    =============

Weighted average shares outstanding                                        115,674,456       42,444,615
                                                                         =============    =============

See accompanying notes to condensed financial statements.


                                                   5
<PAGE>

                                     GLOBAL BEVERAGE SOLUTIONS, INC.
                                   Condensed Statements of Cash Flows
                                 Six Months Ended June 30, 2007 and 2006
                                               (Unaudited)

                                                                                2007            2006
                                                                            ------------    ------------
Cash flows from operating activities:
  Net decrease in net assets from operations                                $ (2,406,709)   $   (319,181)
  Adjustments to reconcile net decrease in net assets from
     operations to net cash used in operating activities:
          Change in unrealized depreciation of portfolio investments           1,658,283               -
          Amortization of intrinsic value of common stock options                 40,450               -
          Discount on notes payable                                               69,281               -
          Depreciation                                                                71               -
          Common stock issued for services                                         1,500               -
          Changes in operating assets and liabilities:
               Interest and fees receivable from portfolio companies                   -         (47,966)
               Deposits and prepaid expenses                                     (11,208)          7,672
               Accounts payable and accrued expenses                             169,784         220,710
                                                                            ------------    ------------
                    Net cash used in operating activities                       (478,548)       (138,765)
                                                                            ------------    ------------
Cash flows from investing activities:
  Investments in and advances to portfolio companies                            (676,249)     (1,112,300)
  Purchase of office equipment                                                    (1,590)              -
                                                                            ------------    ------------
                    Net cash used in investing activities                       (677,839)     (1,112,300)
                                                                            ------------    ------------
Cash flows from financing activities:
  Common stock issued for cash                                                 2,210,898       1,121,000
  Repayment of notes payable                                                  (1,053,120)              -
                                                                            ------------    ------------
                    Net cash provided by financing activities                  1,157,778       1,121,000
                                                                            ------------    ------------
Net increase (decrease) in cash and cash equivalents                               1,391        (130,065)
Cash and cash equivalents, beginning of period                                       472         245,370
                                                                            ------------    ------------
Cash and cash equivalents, end of period                                    $      1,863    $    115,305
                                                                            ============    ============

Supplemental Cash Flow Information:
  Cash paid for interest and income taxes:
     Interest                                                               $     27,470    $          -
     Income taxes                                                                      -               -

  Non-cash investing and financing activities: Common stock issued for:
        Legal settlements                                                            $ -    $    182,000
        Amounts due Rudy Ruettiger by Rudy Beverage, Inc.                        625,000               -
        Acquisition of Beverage Networks of Maryland, Inc.                     8,896,500               -
        Acquisition of Aqua Maestro, Inc.                                      1,431,250               -
        Liability of Rudy Beverage, Inc.                                           7,458           8,111
     Notes payable issued as partial consideration for:
        Acquisition of Beverage Networks of Maryland, Inc.                     3,704,652               -
        Acquisition of Aqua Maestro, Inc.                                        190,356               -

See accompanying notes to condensed financial statements.


                                                   6
<PAGE>

                               GLOBAL BEVERAGE SOLUTIONS, INC.
                        Condensed Statements of Changes in Net Assets
                           Six Months Ended June 30, 2007 and 2006
                                         (Unaudited)


                                                                    2007            2006
                                                                ------------    ------------
Changes in net assets from operations:
  Net loss from operations                                      $   (748,426)   $   (319,181)
  Net realized loss on sale of investments, net                            -               -
  Change in net unrealized depreciation of investments, net       (1,658,283)              -
                                                                ------------    ------------
    Net decrease in net assets from operations                    (2,406,709)       (319,181)
                                                                ------------    ------------

Capital stock transactions:
  Common stock issued for:
     Cash                                                          2,210,898       1,121,000
     Amounts due Rudy Ruettiger by Rudy Beverage, Inc.               625,000               -
     Acquisition of Beverage Network of Maryland, Inc.             8,896,500               -
     Acquisition of Aqua Maestro, Inc.                             1,431,250               -
     Services                                                          1,500               -
     Notes and other debts                                             7,458         190,111
  Amortization of intrinsic value of common stock options             40,450               -
                                                                ------------    ------------
    Net increase in net assets from stock transactions            13,213,056       1,311,111
                                                                ------------    ------------
          Net increase in net assets                              10,806,347         991,930
          Net assets, beginning of period                             89,396       5,827,124
                                                                ------------    ------------
          Net assets, end of period                             $ 10,895,743    $  6,819,054
                                                                ============    ============

See accompanying notes to condensed financial statements.


                                              7
<PAGE>

                                    GLOBAL BEVERAGE SOLUTIONS, INC.
                                          Financial Highlights
                                Sxi Months Ended June 30, 2007 and 2006
                                              (Unaudited)

                                                                            2007              2006
                                                                       -------------     -------------

PER SHARE INFORMATION
 Net asset value, beginning of period                                  $      0.0020     $      0.1411
 Net decrease from operations                                                (0.0065)          (0.0075)
 Net change in realized losses and unrealized
  depreciation of investments, net                                           (0.0143)                -
 Net increase from stock transactions                                         0.0928            0.0197
                                                                       -------------     -------------
     Net asset value, end of period                                    $      0.0740     $      0.1533
                                                                       =============     =============

Per share market value:
     Beginning of period                                               $        0.42     $        1.67
     End of period                                                              0.06              0.94
Investment return, based on market price at end of period (1)                 -85.7%            -43.7%

RATIOS/SUPPLEMENTAL DATA
 Net assets, end of period                                             $  10,895,743     $   6,819,054
 Average net assets                                                        5,840,064         6,239,783
 Annualized ratio of expenses to average net assets                               26%               12%
 Annualized ratio of net decrease in net assets from operations to
     average net assets                                                          -82%              -10%
 Shares outstanding at end of period                                     147,267,501        44,475,065
 Weighted average shares outstanding during period                       115,674,456        42,494,615

(1) Periods of less than one year are not annualized

See accompanying notes to condensed financial statements.


                                                   8
<PAGE>

                                              GLOBAL BEVERAGE SOLUTIONS, INC.
                                                  Schedule of Investments
                                                      June 30, 2007

              Date of                                                         Historical           Fair          % Net
  Shares    Acquisition                                                          Cost             Value         Assets

INVESTMENT IN UNAFFILIATED ISSUERS
----------------------------------
     8%        Jun-05    Titanium Design Studio, Inc., privately held;
                         a titanium jewelry manufacturer                          $ 200,000     $          -          0%
                                                                            ----------------  ---------------  ----------

INVESTMENT IN AND ADVANCES TO NON-CONTROLLED AFFILIATED PORTFOLIO COMPANIES
---------------------------------------------------------------------------
    44%        Jul-05    EON Beverage Group, Inc., privately held;
                         manufactures structured water pursuant to
                         proprietary process                                      1,011,500                -          0%
    N/A        May-07    Note receivable from Rudy Partners, Ltd. in face
                         amount of $6,000,000, received in sale of 80%
                         of Rudy Beverage, Inc. owned by the Company;
                         Rudy sells and manufactures beverages higher
                         in nutritional value and lower in sugar than
                         most existing brands; collateralized with 11
                         million shares of the Company's common stock             7,303,043          550,000          5%
                                                                            ----------------  ---------------  ----------
                                                                                  8,314,543          550,000          5%
                                                                            ----------------  ---------------  ----------

INVESTMENTS IN AND ADVANCES TO CONTROLLED AFFILIATED PORTFOLIO COMPANIES
------------------------------------------------------------------------
   100%        Feb-07    Beverage Network of Maryland, Inc., wholly-
                         owned subsidiary; distributor of beverages in
                         the Mid-Atlantic States                                 12,941,575       12,941,575        119%
   100%        Mar-07    Aqua Maestro, Inc., wholly-owned subsidiary;
                         engaged in wholesale and retail distribution
                         of domestic and imported bottled water                   1,956,606        1,956,606         15%
                                                                            ----------------  ---------------
                                                                                 14,898,181       14,898,181
                                                                            ----------------  ---------------  ----------
                         Total investments at June 30, 2007                    $ 23,412,724       15,448,181        142%
                                                                            ================
                         Cash and other assets, less liabilities                                  (4,552,438)       -42%
                                                                                              ---------------  ----------
                         Net assets at June 30, 2007                                            $ 10,895,743        100%
                                                                                              ===============  ==========

See accompanying notes to financial statements.


                                                            9
<PAGE>

                                              GLOBAL BEVERAGE SOLUTIONS, INC.
                                                  Schedule of Investments
                                                    December 31, 2006

              Date of                                                           Historical          Fair         % Net
  Shares    Acquisition                                                            Cost            Value         Assets

COMMON STOCK IN UNAFFILIATED ISSUERS
------------------------------------
    8%        Jun-05    Titanium Design Studio, Inc., privately held;
                        a titanium jewelry manufacturer                            $ 200,000      $         -          0%
                                                                              ===============  =============== ===========

COMMON STOCK IN NON-CONTROLLED AFFILIATED PORTFOLIO COMPANIES
-------------------------------------------------------------
   44%        Jul-05    EON Beverage Group, Inc., privately held;
                        manufactures structured water pursuant to
                        proprietary process                                        1,011,500                -          0%
                                                                              ===============  =============== ===========

COMMON STOCK IN CONTROLLED AFFILIATED PORTFOLIO COMPANIES
---------------------------------------------------------
   80%        Nov-05    Rudy Beverage, Inc., privately held; sells and
                        manufactures beverages higher in nutritional
                        value and lower in sugar than most existing
                        brands                                                     6,669,760        1,575,000       1762%
                                                                              ---------------  --------------- -----------
                        Total investments at December 31, 2006                   $ 6,669,760        1,575,000       1762%
                                                                              ===============
                        Cash and other assets, less liabilities                                    (1,485,604)     -1662%
                                                                                               --------------- -----------
                        Net assets at December 31, 2006                                           $    89,396        100%
                                                                                               =============== ===========

See accompanying notes to financial statements.


                                                            10
</TABLE>
<PAGE>

                         GLOBAL BEVERAGE SOLUTIONS, INC.
                     Notes to Condensed Financial Statements
                                   (Unaudited)


(1)  DESCRIPTION OF BUSINESS

(A)  ORGANIZATION AND BUSINESS
------------------------------

The condensed financial statements include the accounts of Global Beverage
Solutions, Inc. ("Global" or the "Company"). Pursuant to Article 6 of Regulation
S-X, the Company will operate on a non-consolidated basis and the financial
results of the Company's portfolio companies are not consolidated in the
Company's financial statements. Only the appreciation or depreciation of these
investments in portfolio companies will be included in the Company's financial
statements.

On June 19, 2003, the Company became a business development company ("BDC")
pursuant to applicable provisions of the Investment Company Act of 1940.

On April 18, 2005, the Company completed a 2,500-to-1 reverse stock split. The
accompanying financial statements have been restated to reflect this stock split
for all periods presented.

On October 10, 2005, the Company changed its name to Global Beverage Solutions,
Inc. and began trading on the OTC Bulletin Board under the symbol GBVS.OB.
Beginning with the original incorporation on January 29, 1977, the Company has
had several name changes, including, Mercury Software, MedEx Corp., Aussie
Apparel Group, Ltd., Bluetorch, Inc., Pacific Crest Investments and Pacific Peak
Investments.


(B)  CONDENSED FINANCIAL STATEMENTS
-----------------------------------

The accompanying condensed financial statements have been prepared by the
Company without audit. In the opinion of management, all adjustments (which
include only normal recurring adjustments) necessary to present fairly the
financial position as of June 30, 2007, and the results of operations and cash
flows for all periods presented have been made.

Certain information and footnote disclosures normally included in financial
statements prepared in accordance with accounting principles generally accepted
in the United States of America have been condensed or omitted. It is suggested
that these condensed financial statements be read in conjunction with the
financial statements and notes thereto included in the Company's December 31,
2006 audited financial statements on Form 10-K. The results of operations for
the interim periods presented are not necessarily indicative of the operating
results for the full years.


                                       11
<PAGE>

(C)  RECLASSIFICATIONS
----------------------

Certain reclassifications have been made to the prior period financial
statements to conform to the current period presentation.


(D)  GOING CONCERN
------------------

The accompanying financial statements have been prepared assuming the Company
will continue as a going concern, which contemplates, among other things, the
realization of assets and satisfaction of liabilities in the normal course of
business. As of June 30, 2007, the Company has an accumulated deficit of
$19,370,437 and had net losses totaling $2,406,709 for the six months ended June
30, 2007. Additionally, as of June 30, 2007, the Company had total assets
excluding investments of $15,064 and had total liabilities of $4,567,502. These
factors, among others, raise substantial doubt about the Company's ability to
continue as a going concern. The Company intends to fund operations through debt
and equity financing arrangements which management believes should be sufficient
to fund its capital expenditures, working capital and other cash requirements
for the next twelve months. The successful outcome of future activities cannot
be determined at this time and there is no assurance that, if achieved, the
Company will have sufficient funds to execute its intended business plan or
generate positive operating results.

The Company currently estimates it will require a total of approximately
$1,675,000 to meet its operating cash flow requirements and its currently
committed follow-on investments for the balance of 2007. The total requirements
include the $1,100,000 in debt service requirements; $275,000 in follow-on
investments to the portfolio companies; and an estimated $300,000 for working
capital and overhead requirements. If the Company is unable to obtain the
additional funding, it may be forced to substantially reduce follow-on
investments, overhead and possibly restructure existing debt. It is expected
that the $1,335,000 convertible notes will be converted into the Company's
common stock.

Management plans to take the following additional steps in response to these
issues:

     It has been determined that, as an investment company, the Company will
     only invest in/acquire businesses which are cash flow positive and
     profitable or businesses which projections indicate can become cash flow
     positive and profitable within a reasonable period. These entities will
     have good growth potential as a result of access to additional capital
     and/or additional management acumen.

     As part of this strategic process, the Company previously decided to
     concentrate its efforts in the beverage industry. It is believed that this
     direction will both reduce the risk for the Company and its shareholders as
     well as provide the best opportunity for long-term shareholder value. In
     addition, with the acquisitions completed in the first quarter of 2007, the
     Company has moved away from start-up companies and is concentrating efforts
     in companies that have some established track-record.


                                       12
<PAGE>

     On January 3, 2007, the Company filed notification of a de minimus sale
     under Regulation E of the Securities Act of 1933. A total of 700,000 shares
     of common stock were sold for $87,500. A second notification was filed
     under Regulation E on January 3, 2007 but this Offering was withdrawn and
     no sales were made pursuant to this offering. An Amended Offering Circular
     was filed on February 5, 2007. As of June 30, 2007, 21,333,333 shares had
     been sold for net cash proceeds of $2,123,398 with a stock subscription
     receivable balance of $273,450.

Whereas the Company believes it will be successful with its plans, due to market
factors and economic conditions, no assurance can be given that financing will
be available on favorable terms or at all.

The financial statements do not include any adjustments related to
recoverability and classification of assets carrying amounts or the amount and
classification of liabilities that might result should the Company be unable to
continue as a going concern.


(2)  INVESTMENTS
----------------

Beverage Network of Maryland, Inc. ("BNM")
------------------------------------------
On February 23, 2007, the Company completed the purchase of BNM from XStream
Beverage Network, Inc. ("XStream"). The transaction was structured as a merger
of BNM into the Company's wholly owned subsidiary Global Merger Corp., a Nevada
corporation, pursuant to the Agreement and Plan of Merger between the parties
dated January 31, 2007, and as amended and completed on February 23, 2007.

Based in Jessup, Maryland, BNM engages in the distribution of beverages in the
Mid-Atlantic States.

As a part of the transaction the Company issued 60,500,000 shares of its common
stock and a $2,000,000 note payable to XStream. At closing, the Company paid
$229,000 on the note and pursuant to the agreements was required to pay 40% of
any subsequent cash proceeds received from the February 5, 2007, 1-E Offering.
The remaining note balance, $1,134,769 at June 30, 2007, is to be paid in
monthly installments of $25,000 commencing September 1, 2007. Additionally, if
the Company raises any equity capital while the note is still outstanding, it is
required to apply 35% of the net proceeds to reduce the note.


                                       13
<PAGE>

Summary financial information for BNM as of June 30, 2007 and for the six months
then ended is as follows:

Current assets                                              $       1,010,951
Property and equipment, net                                            61,028
Intangible assets, net                                              1,636,916
Other assets                                                           46,371
                                                            -----------------
     Total assets                                           $       2,755,266
                                                            =================

Current liabilities                                         $         893,469
Amounts due Global                                                  3,489,293
                                                            -----------------
     Total liabilities                                              4,382,762

Stockholder's deficit                                              (1,627,495)
                                                            -----------------
     Total liabilities and stockholder's deficit            $       2,755,266
                                                            =================

Revenues                                                    $       4,489,834
                                                            =================

Net loss                                                    $         366,304
                                                            =================

Management reviewed the accounting guidance related to the acquisition of BNM,
which included EITF 90-13 and originally concluded that in future financial
statements of the Company this transaction would be reported as a reverse
merger. Upon discussion with the SEC, it was determined that EITF 90-13 would
not act to control the status of a business development company under the
Investment Company Act of 1940 and the Company's financial statements should be
presented as investment company financial statements, notwithstanding a change
in control of the Company, if any.

Aqua Maestro, Inc. ("AM")
-------------------------
On March 29, 2007, the Company completed the purchase of AM from the
shareholders of AM. The transaction was structured as a merger of AM into the
Company's wholly owned subsidiary, Global Beverage Acquisition Corp., a Florida
corporation, pursuant to the Agreement and Plan of Merger and Reorganization
between the parties dated March 29, 2007.

With its business office in Boca Raton, Florida and logistics in Fort
Lauderdale, Florida, AM is engaged in the wholesale and retail distribution of
domestic and imported bottled water, comprising forty-four brands and over one
hundred-seventy different items. The wholesale client base is across North
America and the Caribbean, including well-known hotels and resorts. In its
retail home delivery division, AM provides product through its Internet site
aquamaestro.com.

Consideration for the acquisition of AM includes $500,000 in cash, 10,000,000
shares of the Company's common stock and an earn-out. The cash was payable
$300,000 at closing and the balance in equal monthly installments of $22,222
beginning April 15, 2007. The earn-out is a percentage of defined gross profit
equal to 10% of calendar 2008 gross profit, 5% of calendar 2009 gross profit and
3% of calendar 2010 gross profit. In accordance with SFAS 141, additional cost
will not be recognized until the amount is determinable.


                                       14
<PAGE>

Summary financial information for AM as of June 30, 2007 and for the six months
then ended is as follows:

Current assets                                             $         288,563
Property and equipment, net                                           15,402
Other assets                                                          27,138
                                                           -----------------
     Total assets                                          $         331,103
                                                           =================

Accounts payable and accrued expenses                      $         185,752
Note payable                                                         150,000
Amounts due Global                                                    85,000
                                                           -----------------
     Total liabilities                                               420,752

Stockholder's deficit                                                (89,649)
                                                           ------------------
     Total liabilities and stockholder's equity            $         331,103
                                                           =================

Revenues                                                   $       1,160,594
                                                           =================

Net loss                                                   $         117,515
                                                           =================


Rudy Partners, Ltd. ("Partners")
--------------------------------
On January 18, 2007, the Company executed an agreement with Partners wherein the
Company agreed to sell its 80% interest in Rudy Beverage, Inc. ("Rudy") for an
8% secured promissory note in the amount of $6,000,000 plus assumption of the
advances and receivables owed to the Company by Rudy. The agreement closed on
May 11, 2007. The note is collateralized by 11,000,000 shares of the Company's
common stock held by Partners' owners and will be payable in six annual
installments of $1,000,000 commencing January 31, 2008. In addition, Partners
agreed to convert any notes payable by Rudy to the Company, once Partners
becomes publicly-traded or a subsidiary of a publicly-traded company, into no
more than 20% of the common stock of the publicly traded entity, based upon the
market value of the public entity's common stock.

Rudy Beverage, Inc. ("Rudy")
----------------------------
On November 17, 2005, the Company executed a Stock Purchase Agreement with the
shareholders ("Sellers") of Rudy, a Nevada corporation, whereby the Company
exchanged 6,000,000 shares of its common stock for 80% of the issued and
outstanding common stock of Rudy. The Company's investment was valued at
$4,860,000 based upon the trading price of the Company's common stock on the
date of the transaction. The Sellers were eligible to receive up to 10,000,000
additional shares of the Company's common stock if Rudy achieved certain sales
and net revenue goals by the twelve month periods ending June 30, 2007 and 2008.
Rudy was founded by Rudy Ruettiger and Drew Carver to create a unique line of
beverages higher in nutritional value but lower in sugar than existing brands.
Rudy developed two distinct products: Rudy Flying Colors, catering to children K
through 8; and Rudy Revolution, a sport drink primarily for athletes. The goal
of the Rudy line of beverages is to create flavorful juice blends lower in sugar
that existing brands.


                                       15
<PAGE>

The Company originally valued its investment in Rudy at December 31, 2006, based
on the estimated value of the collateral on the Partners note of $3,375,000,
resulting in an original adjustment of $3,294,760 as unrealized depreciation of
the investment. Subsequent to December 31, 2006, based on the decline in the
collateral on the Partners note, that is, the shares of the Company's common
stock held by Partners owners, the Company recorded an additional adjustment of
$1,800,000 under guidance in FAS 5 for the additional decline in the Company's
common stock as of April 24, 2007.

EON Beverage Group, Inc.
------------------------
On July 8, 2005, the Company consummated the transactions contemplated by the
Share Purchase Agreement (dated June 28, 2005) with EON Beverage Group, Inc.
("EON") and, as a result, the Company invested $400,000 in exchange for 9% of
the issued and outstanding common stock of EON. EON manufactures structured
water through a proprietary process (patent pending) which alters the molecular
structure of purified water. Structured water is a relatively new concept which
is generally defined as water molecules organized through hydrogen bonding into
distinct molecular structures. This allows the users of EON water to achieve
enhanced intra-cellular hydration through significant absorption capability that
is crucial for maximum biological activity and improved athletic performance,
based on the representations of EON. The Company made follow-on investments in
the form of loans in the total amount of $611,500 as of September 30, 2006, to
EON. These amounts were fully reserved at September 30, 2006, as discussed
below.

During the first quarter of 2006, shareholders of the Company contributed their
35% ownership of EON to the Company, which increased the Company's ownership to
44%. No value was attributed to the increased interest based on the Company's
valuation at the time. During September 2006, the Company determined that,
without substantial additional capital, EON had little chance of becoming
successful. With current capital committed to Rudy, the Company elected to
discontinue funding EON and fully wrote-down its investment. This amounted to
$1,011,500 which was included in change in unrealized depreciation of portfolio
investments in September 2006.

Titanium Design Studio, Inc.
----------------------------
On June 6, 2005, the Company signed a Share Purchase Agreement with Titanium
Design Studio, Inc. ("TDS"), a Nevada corporation, whereby the Company invested
$200,000 in cash in exchange for 8% of the issued and outstanding common stock
of TDS. TDS has a proprietary manufacturing process which allows it to cast
precision titanium jewelry resulting in a level of detail not obtainable by
milling titanium. TDS can economically produce and supply jewelry in shapes and
patterns which were previously considered to be impossible or uneconomical to
manufacture. TDS believes its technology has applications in other industries,
including aerospace, dentistry, sporting goods (fishing rods) and commemorative
coins. Early in 2006, TDS relocated its operations to Thailand in order to
access cheaper labor. The Board of Directors of the Company recorded an
unrealized loss in the amount of $200,000 relating to this investment at
December 31, 2005.


                                       16
<PAGE>

VALUATION OF INVESTMENTS

As required by Section 2(a)(41) of the Investment Company Act of 1940, the board
of directors of the Company is required to assign a fair value to all
investments. To comply with Section 2(a) (41) of the Investment Company Act and
Rule 2a-4 under the Investment Company Act, it is incumbent upon the board of
directors to satisfy themselves that all appropriate factors relevant to the
value of securities for which market quotations are not readily available have
been considered and to determine the method of arriving at the fair value of
each such security. To the extent considered necessary, the board may appoint
persons to assist them in the determination of such value and to make the actual
calculations pursuant to the board's direction. The board must also, consistent
with this responsibility, continuously review the appropriateness of the method
used in valuing each issue of security in the Company's portfolio. The directors
must recognize their responsibilities in this matter and whenever technical
assistance is requested from individuals who are not directors, the findings of
such individuals must be carefully reviewed by the directors in order to satisfy
themselves that the resulting valuations are fair.

No single standard for determining "fair value in good faith" can be laid down,
since fair value depends upon the circumstances of each individual case. As a
general principle, the current "fair value" of an issue of securities being
valued by the board of directors would appear to be the amount that the owner
might reasonably expect to receive for them upon their current sale. Methods
that are in accord with this principle may, for example, be based on a multiple
of earnings, or a discount from market of a similar freely traded security, or
yield to maturity with respect to debt issues, or a combination of these and
other methods. Some of the general factors that the directors should consider in
determining a valuation method for an individual issue of securities include: 1)
the fundamental analytical data relating to the investment, 2) the nature and
duration of restrictions on disposition of the securities, and 3) an evaluation
of the forces which influence the market in which these securities are purchased
and sold. Among the more specific factors which are to be considered are: type
of security, financial statements, cost at date of purchase, size of holding,
discount from market value of unrestricted securities of the same class at time
of purchase, special reports prepared by analysts, information as to any
transactions or offers with respect to the security, existence of merger
proposals or tender offers affecting the securities, price and extent of public
trading in similar securities of the issuer or comparable companies and other
relevant matters.

The board has arrived at the following valuation method for its investments.
Where there is not a readily available source for determining the market value
of any investment, either because the investment is not publicly traded or is
thinly traded and in absence of a recent appraisal, the value of the investment
shall be based on the following criteria:

     1.   Total amount of the Company's actual investment ("AI"). This amount
          shall include all loans, purchase price of securities and fair value
          of securities given at the time of exchange.
     2.   Total revenues for the preceding twelve months ("R").
     3.   Earnings before interest, taxes and depreciation ("EBITD")
     4.   Estimate of likely sale price of investment ("ESP")
     5.   Net assets of investment ("NA")
     6.   Likelihood of investment generating positive returns (going concern).


                                       17
<PAGE>

The estimated value of each investment shall be determined as follows:

- Where no or limited revenues or earnings are present, then the value shall be
the greater of the investment's a) net assets, b) estimated sales price, or c)
total amount of actual investment.
- Where revenues and/or earnings are present, then the value shall be the
greater of one-time (1x) revenues or three times (3x) earnings, plus the greater
of the net assets of the investment or the total amount of the actual
investment.
- Under both scenarios, the value of the investment shall be adjusted down if
there is a reasonable expectation that the Company will not be able to recoup
the investment or if there is reasonable doubt about the investment's ability to
continue as a going concern.

Based on the previous methodology, the Board of Directors of the Company
determined that the Company's investments should be valued at June 30, 2007 as
follows:

     o    Beverage Network of Maryland, Inc.
          BNM is an operating beverage distribution company which the Company
          acquired on February 23, 2007. Based on the established valuation
          method, the investment in BNM is valued at its original cost of
          $12,601,152 plus net follow-on investments of $340,423 at June 30,
          2007.

     o    Aqua Maestro, Inc.
          AM operates as a wholesale and retail distributor of domestic and
          imported bottled water. The acquisition was completed on March 29,
          2007. Accordingly, based upon the established valuation method, the
          investment in AM is valued at its original cost of $1,921,606 plus
          follow-on investments of $35,000 at June 30, 2007.

     o    Rudy Partners, Ltd.
          The Company valued its note receivable investment in Rudy based on the
          estimated value of the collateral on the Partners note discussed
          above. The value at December 31, 2006, was based on the value of the
          Company's common stock at April 24, 2007. As a result of a decline in
          the selling price of the Company's common stock, the Company recorded
          additional unrealized depreciation on the note in the amount of
          $1,658,283 at June 30, 2007 and valued the note at $550,000.

     o    EON Beverage Group, Inc.
          EON has been involved in test marketing its structured water and has
          had limited revenues during this testing phase. During the first
          quarter of 2006, shareholders of the Company contributed their stock
          in EON to the Company, which increased the Company's ownership to 44%.
          While EON expected to sell a substantial volume of its structured
          water to Rudy for use in certain of its drinks, the Board of Directors
          determined that EON will not achieve profitability without substantial
          additional investment, which the Company is unwilling to provide.
          Accordingly, the Company fully wrote-down its investment of $400,000
          and its advances of $611,500 for a total unrealized depreciation
          expense of $1,011,500 at September 30, 2006. Accounts receivable in
          the amount of $50,369 for interest charges and management fees were
          also fully reserved at September 30, 2006.


                                       18
<PAGE>

     o    Titanium Design Studio, Inc.
          Early in 2006, TDS relocated its operations to Thailand in order to
          access cheaper labor. As a result, the Company fully reserved its
          investment of $200,000 at December 31, 2005.


(3)  NOTES PAYABLE
------------------

Notes payable at June 30, 2007, consist of the following:

<TABLE>
<S>     <C>
Secured convertible promissory notes payable (1)                                          1,335,000
Note payable to XStream Beverage Network, Inc. with interest at 6%; the
  collateralized note required payment of 40% of any cash proceeds received by
  Global from the February 5, 2007 1-E Offering with the remainder payable in
  monthly installments of $25,000 commencing September 1, 2007. In a Master
  Security Agreement, Global granted XStream a continuing security interest in
  substantially all of its assets as collateral as long as any obligation
  arising from the Agreement and Plan of Merger, as amended, remains
  outstanding. In addition, pursuant to a Stock Pledge Agreement, the BNM stock
  owned by Global is pledged as additional collateral on the obligations and BNM
  guarantees the Global obligations
  to XStream.                                                                             1,134,769
Non-interest bearing note payable to Master Distributor which was assumed as a
  part of the acquisition of BNM. Monthly payments of $83,333 for two years;
  discounted at 12%; penalty provisions require a late charge of $5,000 plus
  interest of 1 1/2% per month for all payments made after the 15th of the
  month; the Company guarantees that the note, with a face value of $2,000,000
  plus the proceeds from 4,000,000 shares of its common stock will equal at
  least $3,000,000 total; and note is in default at June 30, 2007                         1,593,834
Non-interest bearing notes payable to the former stockholders of Aqua Maestro,
  Inc.; payable in 9 equal monthly payments of $22,222 commencing on April 15,
  2007; discounted at 12%; collateralized by inventory of Aqua
  Maestro; and note is in defaultat June 30, 2007                                           182,566
                                                                                      --------------
          Total notes payable                                                             4,246,169
                                                                                      ==============
</TABLE>

(1) During the year ended December 31, 2006, the Company issued 8%, one-year
secured convertible promissory notes payable ("Secured Notes") to a group of
investors in the aggregate amount of $1,335,000. The notes were convertible into
restricted common shares at an initial rate of $.50 per share. Management has
determined that these notes qualify as conventional convertible debt pursuant to
APB No. 14, "Accounting for Convertible Debt and Debt Issued with Stock Purchase
Warrants" and EITF 98-5, "Accounting for Convertible Securities with Beneficial
Conversion Features or Contingently Adjustable Conversion Ratios," accordingly
the embedded conversion option is not a derivative. The Company computed an
intrinsic value of the beneficial conversion of $538,000 based on the quoted
stock price on the grant dates. The beneficial conversion feature was credited
to additional paid-in capital and charged to interest expense when the agreement
commenced since the Secured Notes could be converted when issued.


                                       19
<PAGE>

The Secured Notes include certain anti-dilutive provisions, such as an
adjustment for stock splits and business combinations, adjustment for common
stock dividends and distributions, adjustment for issuance of additional shares
of common stock at a price per share less than the initial conversion price, and
issuance of common stock equivalents at a price per share less than the initial
conversion price.

As of June 30, 2007, Secured Notes in the aggregate principal amount of
$1,335,000 are in default as the interest due on November 1, 2006, February 1,
2007 and May 1, 1007 was not paid. The default rate of interest of 12% is in
effect for these Secured Notes.

As of December 31, 2006, the Secured Notes were convertible into common stock at
the rate of $.50 per share. In January 2007, the Company sold 700,000 shares of
its common stock pursuant to its Offering Circular dated January 3, 2007, for
$87,500 ($.125/share). Accordingly, pursuant to the Secured Note agreement, the
conversion rate for the Secured Notes became $.125 on that date.

The two discounted notes may be summarized as follows:

        Face value of discounted notes payable                 $ 1,928,778
        Discount                                                  (152,378)
                                                            ---------------
          Present value of discounted notes                    $ 1,776,400
                                                            ===============


(4)  EQUITY

COMMON STOCK:
-------------
The Company is authorized to issue up to 950,000,000 shares of common stock, par
value $.001. At June 30, 2007, there were 147,267,501 shares issued and
outstanding.

PREFERRED STOCK:
---------------
The Company is authorized to issue up to 50,000,000 shares of preferred stock at
$0.001 par value. At June 30, 2007, there are no preferred shares issued or
outstanding.

OPTIONS:
--------
The Company recognizes amortization expense on a straight-line basis over the
requisite service period for each stock option grant. Total stock-based
amortization expense recognized was $40,450 and $0, during the six months ended
June 30, 2007 and 2006, respectively.


                                       20
<PAGE>

STOCK SUBSCRIPTION RECEIVABLE:
------------------------------
On June 28, 2007, the Company reduced its remaining stock subscription
receivable from $820,350 to $273,450 to more correctly reflect the current
trading price of the common stock. The receivable was collected in July 2007.


(5)  COMMITMENTS AND CONTINGENCIES

General - The Company's commitments and contingencies include the usual
obligations which arise in the normal course of business. In the opinion of
management, these matters are not expected to have a material adverse effect on
the Company's financial position and results of operations. In addition, whereas
the Company may be indirectly impacted by claims and other obligations that
arise at its portfolio companies, management is not aware of any such claims.

SEC - On March 26, 2007, the Company received comments from the SEC regarding
its Amended 1-E Offering filed on February 5, 2007 ("Amended Offering"). In its
comments, the SEC raised issues not only with the Amended Offering, and previous
1-E Offerings, but also with respect to the Company's compliance with other
provisions of the 1940 Act. A primary issue was its belief that the Company was
not eligible to take advantage of the Regulation E Exemption afforded 1940 Act
companies. In the event the SEC is correct in its assessment that the Company
was not eligible for using the Regulation E exemption, the Company could be
required to offer rescission to each subscriber of the Company's 1-E offerings
from September 15, 2005 to January 19, 2007. In addition, we currently
understand that we may be out of compliance with certain other rules and
regulations governing BDCs. We cannot predict with certainty what, if any,
regulatory or financial consequences may result from the foregoing.

Other Items - The Company had a month-to-month agreement with its chief
executive officer which provided for payment of compensation of $6,000 per
month, which terminated when he resigned in January 2007. The Company's current
CEO has a salary of $185,000 per annum.

The Company leases its office facility on a month-to-month basis at the rate of
$4,570 per month.

The Company currently estimates it will require a total of approximately
$1,675,000 to meet its operating cash flow requirements and its currently
committed follow-on investments for the balance of 2007. The total requirements
include $1,100,000 in loan payments; $275,000 in follow-on investments to the
portfolio companies; and an estimated $300,000 for working capital and overhead
requirements.

Guaranty - The Company issued a non-interest bearing note in the amount of
$2,000,000 together with 4,000,000 shares of the Company's common stock to a
creditor of BNM. The Company has guaranteed that the creditor will receive at
least $3,000,000 from the note and the stock, providing the shares are sold by
February 23, 2009. The Company also guaranteed payment of salary to two
individuals by BNM in the total amount of $134,000 for 2007 and $26,000 for
2008, 2009 and 2010 and guaranteed reimbursement of expenses and payment of
health benefits for the same periods.


                                       21
<PAGE>

(6)  SUBSEQUENT EVENTS

NOTE PURCHASE AGREEMENT
On July 6, 2007, the Company entered into a Note Purchase Agreement
("Agreement") with a certain accredited investor ("Investor") for the private
placement of a convertible promissory note ("Note") in the principal amount of
$259,202 for a purchase price of $233,450. The maturity date of the Note is
August 31, 2008. If and when the Company withdraws its election to be regulated
as a business development company under the Investment Company Act of 1940
("1940 Act"), the Note will be convertible, at the option of the Investor, into
a number of shares of the Company's common stock as determined in accordance
with a formula set forth in the Agreement (at a conversion rate of 75% of the
average of the lowest trade price of the common stock during any three business
days for the ten business day period prior to such conversion election, as
reported by Bloomberg L.P.).

In connection with the Agreement, the Company entered into a letter agreement
with Palladium Capital Advisors, LLC as placement agent, pursuant to which the
Company agreed to pay the placement agent for its services, a cash fee of
$33,333 as soon as practicable after the consummation of the transaction and
$16,667, which is payable within 120 days of the date of the Agreement either in
cash or, if and when the Company withdraws its election to be regulated pursuant
to the 1940 Act through the issuance of the Company's common stock.

The Company and the Investor also entered into a Registration Rights Agreement
pursuant to which the Company has agreed to provide certain registration rights
with respect to shares of its common stock issuable upon the Investor's election
to exercise the conversion right contained in the Note.

WITHDRAWAL OF ELECTION TO BE TREATED AS A BUSINESS DEVELOPMENT COMPANY
On July 13, 2007, the Company filed its preliminary information statement on
Schedule 14(c) which was provided on behalf of the board of directors ("Board")
of the Company to record holders of shares of the Company's common stock
("Shareholders") as of the close of business on the record date of July 12,
2007. This information statement provided notice that the Board has recommended,
and holders of a majority of the voting power of the Company's common stock have
voted to approve authorization to the Board to withdraw the Company's election
to be treated as a business development company under the 1940 Act. The action
will become effective upon the Company filing Form N-54C with the Securities and
Exchange Commission.

                         Overview and Business Strategy

Subsequent to the filing of the Form N-54C, the Company intends to pursue a
business model whereby it would acquire majority ownership stakes in
beverage-related companies (the "New Business Model"). In this regard, the
Company would remain active in the imported bottled water category and New Age
beverage category through its two wholly owned entities: Aqua Maestro and
Beverage Network of Maryland.


                                       22
<PAGE>

Under the New Business Model, the Company will at all times conduct its
activities in such a way that it will not be deemed an "investment company"
subject to regulation under the 1940 Act. Thus, it will not hold itself out as
being engaged primarily in the business of investing, reinvesting or trading in
securities. In addition, the Company will conduct its business in such a manner
as to ensure that it will at no time own or propose to acquire investment
securities having a value exceeding 40 percent of the Company's total assets at
any one time.

Aqua Maestro is based in Boca Raton, FL and imports and sells bottled water
through company owned distribution to retailers and consumers in South Florida,
direct sales to retailers outside of South Florida, direct sales to consumers
generated through its website at aquamaestro.com and sales to third party
distributors.

Beverage Network of Maryland is a New Age distributor based in Jessup, Maryland
and distributes brands such as Welch's and Fiji water to retailers in Washington
DC, Northern Virginia, and the entire state of Maryland.

Our strategy would be to grow the third party branded revenue base in each of
these entities while developing and/or acquiring bottled water or New Age
beverage brands. Thus, through these entities, we will sell our own proprietary
brands as well as third party brands.



                                       23
<PAGE>

ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

This Form 10-Q contains forward-looking statements. For this purpose, any
statements contained herein that are not statements of historical fact may be
deemed to be forward-looking statements. These statements relate to future
events or our future financial performance. In some cases, you can identify
forward-looking statements by terminology such as "may", "will", "should",
"expects", "plans", "anticipates", "believes", "estimates", "predicts",
"potential", "continue" or the negative of such terms or other comparable
terminology. These statements are only predictions. Actual events or results may
differ materially. There are a number of factors that could cause our actual
results to differ materially from those indicated by such forward-looking
statements.

Although we believe that the expectations reflected in the forward-looking
statements are reasonable, we cannot guarantee future results, levels of
activity, performance or achievements. Moreover, we do not assume responsibility
for the accuracy and completeness of such forward-looking statements. We are
under no duty to update any of the forward-looking statements after the date of
this information statement to conform such statements to actual results.
Management's discussion and analysis should be read in conjunction with our
financial statements and the notes herein.

Critical Accounting Policies and Estimates
------------------------------------------

Management's Discussion and Analysis of Financial Condition and Results of
Operations discusses our financial statements, which have been prepared in
accordance with accounting principles generally accepted in the United States of
America. The preparation of these financial statements requires us to make
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported amounts of
revenues and expenses during the reporting periods. On an on-going basis, we
will evaluate our estimates and judgments, including those related to revenue
recognition, valuation of investments in portfolio companies, accrued expenses,
financing operations, contingencies and litigation. We will base our estimates
and judgments on historical experience and on various other factors that are
believed to be reasonable under the circumstances, the results of which form the
basis for making judgments about the carrying value of assets and liabilities
that are not readily apparent from other sources. Actual results may differ from
these estimates under different assumptions or conditions. The most significant
accounting estimates inherent in the preparation of our financial statements
include estimates as to the appropriate carrying value of certain assets and
liabilities which are not readily apparent from other sources, such as the
investments in portfolio companies. These accounting policies are described at
relevant sections in this discussion and analysis and in the "Notes to Financial
Statements" included in our Annual Report on Form 10-K for the fiscal year ended
December 31, 2006.


                                       24
<PAGE>

Withdrawal of Election to be Treated as a BDC
---------------------------------------------

On July 13, 2007, we filed our preliminary information statement on Schedule
14(c) which was provided on behalf of our board of directors ("Board") to record
holders of shares of our common stock ("Shareholders") as of the close of
business on the record date of July 12, 2007. This information statement
provided notice that the Board has recommended, and holders of a majority of the
voting power of our common stock have voted to approve authorization to the
Board to withdraw our election to be treated as a business development company
under the 1940 Act. The action will become effective upon our filing Form N-54C
with the Securities and Exchange Commission.

                         Overview and Business Strategy

Subsequent to the filing of the Form N-54C, the Company intends to pursue a
business model whereby it would acquire majority ownership stakes in
beverage-related companies (the "New Business Model"). In this regard, the
Company would remain active in the imported bottled water category and New Age
beverage category through its two wholly owned entities: Aqua Maestro and
Beverage Network of Maryland.

Under the New Business Model, the Company will at all times conduct its
activities in such a way that it will not be deemed an "investment company"
subject to regulation under the 1940 Act. Thus, it will not hold itself out as
being engaged primarily in the business of investing, reinvesting or trading in
securities. In addition, the Company will conduct its business in such a manner
as to ensure that it will at no time own or propose to acquire investment
securities having a value exceeding 40 percent of the Company's total assets at
any one time.

Aqua Maestro is based in Boca Raton, FL and imports and sells bottled water
through company owned distribution to retailers and consumers in South Florida,
direct sales to retailers outside of South Florida, direct sales to consumers
generated through its website at aquamaestro.com and sales to third party
distributors.

Beverage Network of Maryland is a New Age distributor based in Jessup, Maryland
and distributes brands such as Welch's and Fiji water to retailers in Washington
DC, Northern Virginia, and the entire state of Maryland.

Our strategy would be to grow the third party branded revenue base in each of
these entities while developing and/or acquiring bottled water or New Age
beverage brands. Thus, through these entities, we will sell our own proprietary
brands as well as third party brands.

Results of Operations
---------------------

Comparison of three months ended June 30, 2007 and 2006 -
---------------------------------------------------------

     o    During the 2006 period we recognized revenue in the amount of $32,530
          in interest income from portfolio companies and $6,000 in management
          fees from portfolio companies. We had no revenue during the 2007
          period.


                                       25
<PAGE>

     o    During the three months ended June 30, 2007, total expenses increased
          $141,068 (56%) to $392,567 from $251,499 in the prior year period.

          1.   Officer and employee compensation increased $42,026 (112%) in
               2007 from the amount in 2006. The increase includes a larger
               staff and a full time CEO commencing in February 2007. In
               addition, there was $25,000 in additional compensation for a
               former CEO for his assistance in completing the acquisition of
               BNM.
          2.   Professional fees decreased $15,983 (13%) in the 2007 period from
               the 2006 period.
          3.   The Company recorded interest expense in the amount of $148,887
               in the 2007 period and had no interest in the 2006 period. All
               debt has been added during the last 12 months, primarily as a
               result of the acquisitions of BNM and AM.
          4.   The Company recognized $20,225 in amortization of the intrinsic
               value of common stock options in 2007. There were no options
               outstanding during the 2006 period.
          5.   The Company had rent and utility expense of $13,557 in 2007 and
               $3,000 in 2006 as a result of the move and the increased staff.

     o    During the 2007 period we recorded unrealized depreciation on our
          investment in the note with Rudy Partners of $1,658,283. We had no
          unrealized depreciation in 2006.

Comparison of six months ended June 30, 2007 and 2006 -
-------------------------------------------------------

     o    During the 2006 period we recognized revenue in the amount of $35,966
          in interest income from portfolio companies and $12,000 in management
          fees from portfolio companies. We had no revenue during the 2007
          period.

     o    During the six months ended June 30, 2007, total expenses increased
          $381,279 (104%) to $748,426 from $367,147 in the prior year period.

          1.   Officer and employee compensation increased $55,730 (74%) in 2007
               from the amount in 2006. The increase includes a larger staff and
               a full time CEO commencing in February 2007. In addition, there
               was $25,000 in additional compensation for the former CEO for his
               assistance in completing the acquisition of BNM.
          2.   Professional fees increased $100,244 (53%) in the 2007 period
               from the 2006 period. The principal cause of the increase is the
               acquisition of BNM and AM.
          3.   Shareholder services and communications increased to $25,180 in
               2007 from $5,240 in 2006, primarily due to an increase in press
               releases and public relations costs associated with the
               acquisitions of BNM and AM.
          4.   Other general and administrative expense increased $13,069 (95%)
               in 2007 as compared to 2006. The increase is primarily due to
               opening the new office location in Florida and the duplication of
               certain costs during the relocation.


                                       26
<PAGE>

          5.   The Company recorded interest expense in the amount of $214,929
               in the 2007 period and had no interest in the 2006 period. All
               debt has been added during the last 12 months, primarily as a
               result of the acquisitions of BNM and AM.
          6.   The Company recognized $40,450 in amortization of the intrinsic
               value of common stock options in 2007. There were no options
               outstanding during the 2006 period.

     o    During the 2007 period we recorded unrealized depreciation on our
          investment in the note with Rudy Partners of $1,658,283. We had no
          unrealized depreciation in 2006.


Liquidity and Capital Resources
-------------------------------

     o    At June 30, 2007, we had net assets of $10,895,743 as compared to net
          assets of $89,396 at December 31, 2006. During the 2007 period, total
          assets increased $13,887,299 and total liabilities increased
          $3,080,952, a net increase of $10,792,229. The principal increase in
          assets was the net increase in investments of $13,873,181. The
          principal increase in liabilities was the net increase in notes
          payable of $2,948,669. The Company now has substantially increased
          assets; however, the debt service requirements include a total of
          approximately $1,100,000 in debt payments due over the balance of
          2007.

          The Company currently estimates it will require a total of
          approximately $1,675,000 to meet its operating cash flow requirements
          and its currently committed follow-on investments for the balance of
          2007. The total requirements include the $1,100,000 in debt service
          requirements; $275,000 in follow-on investments to the portfolio
          companies; and an estimated $300,000 for working capital and overhead
          requirements. If it is unable to obtain the additional funding, it may
          be forced to substantially reduce follow-on investments, overhead and
          possible restructure existing debt. It is expected that the $1,335,000
          convertible notes will be converted into the Company's common stock.

     o    As of June 30, 2007, the Company had limited revenues and had an
          accumulated deficit totaling $19,370,437. Additionally, as of June 30,
          2007, the Company had total assets excluding investments of $15,064
          and total liabilities of $4,567,502. These factors, among others,
          raise substantial doubt about the Company's ability to continue as a
          going concern. The Company intends to fund operations through debt and
          equity financing arrangements which management believes should be
          sufficient to fund its capital expenditures, working capital and other
          cash requirements for the next twelve months. The successful outcome
          of future activities cannot be determined at this time and there is no
          assurance that, if achieved, the Company will have sufficient funds to
          execute its intended business plan or generate positive operating
          results.


                                       27
<PAGE>

Net Asset Value
---------------

As a BDC, certain of our activities and disclosures are made in reference to Net
Asset Value ("NAV") which is the value of our portfolio assets less debt and
preferred stock. This may be viewed, simply and generalized, as the value of our
assets available to our common stock holders. As of the date of the financial
information in this report, the value of our portfolio of assets including
investments and securities in portfolio companies and cash is $15,463,245 and
from this, are subtracted liabilities and debts of $4,567,502. There are no
shares of preferred stock outstanding but the rights of preferred stockholders
would be included if there were. The NAV is therefore $10,895,743. The Net Asset
Value per Share ("NAV/S") is calculated by dividing the NAV by the number of
common shares outstanding (147,267,501). The NAV/S is $.0740.

Off Balance Sheet Arrangements
------------------------------

     o    None.

Contractual Obligations
-----------------------

     o    None.



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<PAGE>

ITEM 3: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Market risk is the risk of loss arising from changes in market rates and prices.
We are primarily exposed to equity price risk, which arises from exposure to
securities that represent an ownership interest in our portfolio companies. The
value of our equity securities and our other investments are based on quoted
market prices or our Board of Directors' good faith determination of their fair
value (which is based, in part, on quoted market prices). Market prices of
common equity securities, in general, are subject to fluctuations, which could
cause the amount to be realized upon the sale or exercise of the instruments to
differ significantly from the current reported value. The fluctuations may
result from perceived changes in the underlying economic characteristics of our
portfolio companies, the relative price of alternative investments, general
market conditions and supply and demand imbalances for a particular security.


ITEM 4: CONTROLS AND PROCEDURES

                      Evaluation of Controls and Procedures

The Company's management, including the Chief Executive Officer ("CEO"),
evaluated the effectiveness of the design and operation of the Company's
disclosure controls and procedures, as defined in Rule 13(a)-15(e) and
15(d)-15(e) of the Exchange Act. Based upon that evaluation, the CEO concluded
that, as of June 30, 2007, the Company's disclosure controls and procedures were
effective in alerting management on a timely basis to material Company
information that would be required to be included in our periodic filings with
the SEC.


                           Changes in Internal Control

There were no significant changes made in the Company's internal controls over
financial reporting that have materially affected, or are reasonably likely to
materially affect, these internal controls.



                                       29
<PAGE>

                           PART II - OTHER INFORMATION
                           ---------------------------


ITEM 1: LEGAL PROCEEDINGS

Not applicable.

ITEM 1A: RISK FACTORS

Not applicable.

ITEM 2: UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None during current quarter.

ITEM 3: DEFAULTS UPON SENIOR SECURITIES

Not applicable.

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

Not applicable.

ITEM 5: OTHER INFORMATION

Not applicable.

ITEM 6: EXHIBITS

The following exhibits are filed with this report on Form 10-Q.

      Exhibit 31    Certifications pursuant to 18 U.S.C. Section 1350 Section
                    302 of the Sarbanes-Oxley Act of 2002

      Exhibit 32    Certifications pursuant to 18 U.S.C. Section 1350 Section
                    906 of the Sarbanes-Oxley Act of 2002



                                       30
<PAGE>


                                    SIGNATURE
                                    ---------

Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

                                           GLOBAL BEVERAGE SOLUTIONS, INC.



    Date:  August 10, 2007                 By: /s/ Jerry Pearring
                                               ----------------------------
                                               Jerry Pearring,
                                               Chief Executive Officer and
                                               Chief Financial Officer



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