UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q



(Mark One)



x QUARTERLY REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2012



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

For the transition period from ____________ to ____________

Commission file number: 000-50370



|PREMIER BEVERAGE
    GROUP CORP.                                                      
|--------------------------------------------------------------------------------------
|(Exact name of small business issuer in its charter)                                  
|                                                                                      
|Nevada                                                                                
|(State or other jurisdiction ofincorporation or organization)                         
|                                                                                      
|501 Madison Avenue,
    Suite 501, New York, NY 10022                                 
|(Address of principal executive offices)                                              
|                                                                                      
|646-820-0630                                                                          
|(Issuer's telephone number)                                                           
|                                                                                      
|                                                                                      
|(Former name, former address and former fiscal year,
    if changed since last report)



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

|Large accelerated filer | o                                              |  | Accelerated filer         | o
|----------------------- | ---------------------------------------------- |  | ------------------------- | -
|Non-accelerated filer   | o(Do not check if a smaller reporting company) |  | Smaller reporting company | x



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



Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date: 61,201,483 shares outstanding as of June 30, 2012.











PREMIER BEVERAGE GROUP CORP.



INDEX

|         |                                                                                       | Page
|-------- | ------------------------------------------------------------------------------------- | ----
|PART I   | FINANCIAL INFORMATION                                                                 | 3   
|Item 1.  | Financial Statements                                                                  | 3   
|         | Condensed Consolidated Balance Sheets (Unaudited)                                     | 3   
|         | Condensed Consolidated Statements of Operations (Unaudited)                           | 4   
|         | Condensed Consolidated Statements of Cash Flows (Unaudited)                           | 5   
|         | Notes to the Condensed Consolidated Financial Statements (Unaudited)                  | 6   
|Item 2.  | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 11  
|Item 3.  | Quantitative and Qualitative Disclosures About Market Risk                            | 13  
|Item 4T. | Controls and Procedures                                                               | 14  
|         |                                                                                       |     
|PART II  | OTHER INFORMATION                                                                     | 15  
|Item 1.  | Legal Proceedings                                                                     | 15  
|Item 2.  | Unregistered Sales of Equity Securities and Use of Proceeds                           | 15  
|Item 3.  | Defaults Upon Senior Securities                                                       | 16  
|Item 4.  | Submission of matters to a Vote of Security Holders                                   | 16  
|Item 5.  | Other Information                                                                     | 16  
|Item 6.  | Exhibits                                                                              | 16  
|         | Signatures                                                                            | 17  



2







PART I – FINANCIAL INFORMATION



Item 1. Consolidated Financial Statements



PREMIER BEVERAGE GROUP CORP.

and Subsidiaries

Condensed Consolidated Balance Sheets



|                                                                                                                                                        |  | June 30, 2012 |            |   |                   |  
|------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------- | ---------- | - | ----------------- | -
|                                                                                                                                                        |  | (Unaudited)   |            |   | December 31, 2011 |  
|ASSETS                                                                                                                                                  |  |               |            |   |                   |  
|Current assets:                                                                                                                                         |  |               |            |   |                   |  
|Cash                                                                                                                                                    |  | $             | -          |   |                   | $
|Accounts receivable, net                                                                                                                                |  |               | 43,598     |   |                   |  
|Inventory                                                                                                                                               |  |               | 25,533     |   |                   |  
|Prepaid expenses                                                                                                                                        |  |               | -          |   |                   |  
|Deferred financing costs                                                                                                                                |  |               | -          |   |                   |  
|Total current assets                                                                                                                                    |  |               | 69,131     |   |                   |  
|                                                                                                                                                        |  |               |            |   |                   |  
|Property and equipment, net                                                                                                                             |  |               | 1,354      |   |                   |  
|                                                                                                                                                        |  |               |            |   |                   |  
|Total assets                                                                                                                                            |  | $             | 70,485     |   |                   | $
|                                                                                                                                                        |  |               |            |   |                   |  
|LIABILITIES AND STOCKHOLDERS' DEFICIT                                                                                                                   |  |               |            |   |                   |  
|Current liabilities:                                                                                                                                    |  |               |            |   |                   |  
|Accounts payable and accrued expenses                                                                                                                   |  | $             | 359,727    |   |                   | $
|Notes payable - current portion                                                                                                                         |  |               | 116,772    |   |                   |  
|Total current liabilities                                                                                                                               |  |               | 476,499    |   |                   |  
|                                                                                                                                                        |  |               |            |   |                   |  
|Long term liabilities:                                                                                                                                  |  |               |            |   |                   |  
|Notes payable - long term, net                                                                                                                          |  |               | 306,709    |   |                   |  
|Total long term liabilities                                                                                                                             |  |               | 306,709    |   |                   |  
|                                                                                                                                                        |  |               |            |   |                   |  
|Total liabilities                                                                                                                                       |  |               | 783,208    |   |                   |  
|                                                                                                                                                        |  |               |            |   |                   |  
|Commitments and contingencies                                                                                                                           |  |               |            |   |                   |  
|                                                                                                                                                        |  |               |            |   |                   |  
|Stockholders' deficit:                                                                                                                                  |  |               |            |   |                   |  
|Preferred stock-$0.0001 par value, 900,000 shares authorized, none issued and outstanding as of June
    30, 2012 and December 31, 2011                 |  |               | -          |   |                   |  
|Series A Preferred stock-$5 stated value, 660,000 shares authorized, 60,000 shares issued and outstanding
    as of June 30, 2012 and December 31, 2011 |  |               | 300,000    |   |                   |  
|Series B Preferred stock-$500 stated value, 2,000 shares issued and outstanding as of June 30, 2012
    and December 31, 2011                           |  |               | 15,000     |   |                   |  
|Common stock-0.00015 par value, 99,000,000 shares authorized, 61,201,483 shares issued and outstanding
    as of June 30, 2012 and December 31, 2011    |  |               | 9,180      |   |                   |  
|Additional paid in capital                                                                                                                              |  |               | 108,987    |   |                   |  
|Accumulated deficit                                                                                                                                     |  |               | (1,145,890 | ) |                   |  
|Total stockholders' deficit                                                                                                                             |  |               | (712,723   | ) |                   |  
|                                                                                                                                                        |  |               |            |   |                   |  
|Total liabilities and stockholders' deficit                                                                                                             |  | $             | 70,485     |   |                   | $



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



3







PREMIER BEVERAGE GROUP CORP.

and Subsidiaries

Condensed Consolidated Statements of Operations

(Unaudited)



|                                                  |  | Three Months Ended June 30, |            |   | Six Months Ended June 30, |  
|------------------------------------------------- |  | --------------------------- | ---------- | - | ------------------------- | -
|                                                  |  | 2012                        |            |   | 2011                      |  
|Revenue:                                          |  |                             |            |   |                           |  
|Sales, net                                        |  | $                           | 15,060     |   |                           | $
|Cost of goods sold                                |  |                             | 3,321      |   |                           |  
|Gross profit                                      |  |                             | 11,739     |   |                           |  
|                                                  |  |                             |            |   |                           |  
|Operating expenses:                               |  |                             |            |   |                           |  
|Selling, general and administrative               |  |                             | 126,258    |   |                           |  
|Depreciation                                      |  |                             | 145        |   |                           |  
|Total operating expenses                          |  |                             | 126,403    |   |                           |  
|                                                  |  |                             |            |   |                           |  
|Net loss from operations                          |  |                             | (114,664   | ) |                           |  
|                                                  |  |                             |            |   |                           |  
|Other income (expense)                            |  |                             |            |   |                           |  
|Interest, net                                     |  |                             | (21,222    | ) |                           |  
|Total other income (expense)                      |  |                             | (21,222    | ) |                           |  
|                                                  |  |                             |            |   |                           |  
|Net loss before provision for income taxes        |  |                             | (135,886   | ) |                           |  
|                                                  |  |                             |            |   |                           |  
|Provision for income taxes (benefit)              |  |                             | -          |   |                           |  
|                                                  |  |                             |            |   |                           |  
|Net loss                                          |  | $                           | (135,886   | ) |                           | $
|                                                  |  |                             |            |   |                           |  
|Net loss per common share, basic                  |  | $                           | (0.00      | ) |                           | $
|                                                  |  |                             |            |   |                           |  
|Weighted average number of common shares, basic   |  |                             | 61,201,483 |   |                           |  
|                                                  |  |                             |            |   |                           |  
|Weighted average number of common shares, diluted |  |                             | 63,183,096 |   |                           |  



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



4







PREMIER BEVERAGE GROUP CORP.

and Subsidiaries

Condensed Consolidated Statements of Cash
Flows

(Unaudited)



|                                                                          |  | Six Months Ended June 30, |         
|------------------------------------------------------------------------- |  | ------------------------- | --------
|                                                                          |  | 2012                      |         
|CASH FLOWS FROM OPERATING ACTIVITIES:                                     |  |                           |         
|Net loss                                                                  |  | $                         | (309,737
|Adjustments to net loss to net cash (used in) operating activities:       |  |                           |         
|Depreciation expense                                                      |  |                           | 290     
|Amortization of deferred financing costs                                  |  |                           | 20,605  
|Beneficial conversion feature in connection with convertible note payable |  |                           | 31,323  
|Changes in operating assets and liabilities:                              |  |                           |         
|(Increase) decrease in accounts receivable                                |  |                           | (11,174 
|(Increase) in inventory                                                   |  |                           | (4,962  
|Decrease (increase) in prepaid and other current assets                   |  |                           | 23,297  
|Increase in accounts payable and accrued expenses                         |  |                           | 141,141 
|Net cash (used in) operating activities                                   |  |                           | (109,217
|                                                                          |  |                           |         
|CASH FLOWS FROM FINANCING ACTIVITIES:                                     |  |                           |         
|Proceeds from issuance of notes payable                                   |  |                           | 112,355 
|Repayments of notes payable                                               |  |                           | (25,000 
|Net cash provided by (used in) financing
    activities                   |  |                           | 87,355  
|                                                                          |  |                           |         
|Net (decrease) increase in cash                                           |  |                           | (21,862 
|                                                                          |  |                           |         
|Cash, beginning of the period                                             |  |                           | 21,862  
|                                                                          |  |                           |         
|Cash, end of the period                                                   |  | $                         | -       
|                                                                          |  |                           |         
|Supplemental Disclosures of Cash Flow Information:                        |  |                           |         
|Cash paid during period for interest                                      |  | $                         | -       
|Cash paid during period for taxes                                         |  | $                         | -       



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



5







Notes to the Unaudited Condensed Consolidated
Financial Statements

For the Six Months Ended June 30, 2012

(Unaudited)



NOTE 1 – UNAUDITED FINANCIAL INFORMATION



The unaudited financial information included
for the six month interim periods ended June 30, 2012 and 2011 were taken from the books and records and are unaudited. However,
such information reflects all adjustments (consisting only of normal recurring adjustments), which are in the opinion of management,
necessary to reflect properly the results of operations for the interim periods presented. The results of operations for the six
month period ended June 30, 2012 are not necessarily indicative of the results expected for the fiscal year ending December 31,
2012.



NOTE 2 – FINANCIAL STATEMENTS AND BASIS OF PRESENTATION



Management has elected to omit substantially
all footnotes relating to the condensed consolidated financial statements of the Premier Beverage Group Corp. (the “Company”)
included in this report. For a complete set of footnotes, reference is made to the Company’s Current Report on Form 10-K
for the year ending December 31, 2011 as filed with the Securities and Exchange Commission and the audited financial statements
included therein.



The accompanying unaudited financial statements
include the accounts of the Company and the accounts of its wholly owned subsidiary OSO Beverages Corp. (and its subsidiary Fury
Distribution LLC) for all periods presented.



NOTE 3 – GOING CONCERN



The accompanying financial statements
have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities
in the normal course of business.  As shown in the accompanying financial statements, the Company incurred a net loss of
$309,737 for the six months ended June 30, 2012, and as of June 30, 2012 the Company has an accumulated deficit of $1,145,890
and a net working capital deficit (total current liabilities exceeded total current assets) of $407,368. These factors among others
raise substantial doubt about the Company’s ability to continue as a going concern.

The Company has undertaken further steps as part of a plan to improve operations with the goal of sustaining its operations for
the next twelve months and beyond to address its lack of liquidity by raising additional funds, either in the form of debt or
equity or some combination thereof. However, there can be no assurance that the Company can successfully accomplish these steps
and or business plans, and it is uncertain that the Company will achieve a profitable level of operations and be able to obtain
additional financing.



The Company’s continued existence
is dependent upon management’s ability to develop profitable operations and resolve its liquidity problems.  Further
losses are anticipated in the development of the Company’s business, and there can be no assurance that the Company will
be able to achieve or maintain profitability. The continuing operations of the Company and the recoverability of the carrying
value of the assets is dependent upon the ability of the Company to obtain necessary financing to fund its working capital requirements,
and upon future profitable operations. The accompanying financial statements do not include any adjustments relating to the recoverability
and classification of asset carrying amounts or the amount and classification of liabilities that might result should the Company
be unable to continue as a going concern.



There can be no assurance that any additional
financings will be available to the Company on satisfactory terms and conditions, if at all.  In the event that the
Company is unable to continue as a going concern, it may elect or be required to seek protection from its creditors by filing
a voluntary petition in bankruptcy or may be subject to an involuntary petition in bankruptcy.





6







NOTE 4 – INVENTORY



Inventory is stated at the lower of cost
or market. Cost is determined using the first-in, first-out method (“FIFO”). Inventory is stated at cost and reserves
are recorded to state the inventory at net realizable value. Inventory at June 30, 2012 was $25,533 as compared to $20,571 as
of December 31, 2011.



NOTE 5 – PROPERTY, PLANT AND EQUIPMENT



Property, plant and equipment at June 30, 2012 and December
31, 2011 consist of the following:



|                                |  | June 30, 2012 (Unaudited) |       |   | December 31, 2011 | 
|------------------------------- |  | ------------------------- | ----- | - | ----------------- | 
|Office furniture and equipment  |  | $                         | 1,741 |   |                   | 
|Less:  accumulated depreciation |  |                           | (387  | ) |                   | 
|                                |  | $                         | 1,354 |   |                   | 



Depreciation expense was $290 and $0 for the six months ended
June 30, 2012 and 2011, respectively.



NOTE 6 – ACCOUNTS PAYABLE AND ACCRUED EXPENSES



Accounts Payable and Accrued Expenses



The Company had outstanding accounts payable
and accrued expenses of $359,727 and $218,686 as of June 30, 2012 and December 31, 2011, respectively. Included in accrued expenses
are consulting agreements with three individuals, including Fouad Kallamni, the Company’s President. Each of these agreements
expires on September 30, 2012 and, with minor variations, provides for monthly compensation of $10,000, of which $5,000 is deferred.
The aggregate amount of deferred compensation under these consulting agreements as of June 30, 2012 is $191,000. Also included
in accrued expenses are penalties accruing under the Company’s senior secured convertible promissory note which matured
on March 31, 2012 and remains in default. As of June 30, 2012, the aggregate amount of accrued penalties was $10,888.



NOTE 7 – NOTES PAYABLE



Notes Payable



At June 30, 2012 and December 31, 2011 the Company has the
following notes payable:



|                                                                                                                                                      |  | June 30, 2012 (Unaudited) |         |  | December 31, 2011 |   |         | Interest Rate |  |  | Maturity Date |  
|----------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------------- | ------- |  | ----------------- | - | ------- | ------------- |  |  | ------------- | -
|Notes Payable - Current Portion                                                                                                                       |  |                           |         |  |                   |   |         |               |  |  |               |  
|Secured Promissory Note                                                                                                                               |  | $                         | 48,500  |  |                   | $ | 48,500  |               |  |  | 0             | %
|Secured Convertible 10% Promissory Note                                                                                                               |  |                           | 6,817   |  |                   |   | 6,567   |               |  |  | 10            | %
|Unsecured Convertible 6% Promissory Notes                                                                                                             |  |                           | 61,455  |  |                   |   | 59,955  |               |  |  | 6             | %
|Total Notes Payable - Current Portion                                                                                                                 |  | $                         | 116,772 |  |                   | $ | 115,022 |               |  |  |               |  
|                                                                                                                                                      |  |                           |         |  |                   |   |         |               |  |  |               |  
|Notes Payable - Long Term                                                                                                                             |  |                           |         |  |                   |   |         |               |  |  |               |  
|Senior Secured Convertible Promissory Note, net of amortized
    debt discount of $0 and $48,319 at June 30, 2013 and December 31, 2011, respectively |  | $                         | 75,000  |  |                   | $ | 51,681  |               |  |  | 0             | %
|Unsecured Convertible Promissory Note                                                                                                                 |  |                           | 202,100 |  |                   |   | 187,100 |               |  |  | 0             | %
|Unsecured Convertible 8% Promissory Notes,
    net of amortized debt discount of $41,837 at June 30, 2013                                             |  |                           | 29,609  |  |                   |   | -       |               |  |  | 8             | %
|Total Notes Payable - Long Term                                                                                                                       |  | $                         | 306,709 |  |                   | $ | 238,781 |               |  |  |               |  
|                                                                                                                                                      |  |                           |         |  |                   |   |         |               |  |  |               |  
|Total Notes Payable                                                                                                                                   |  | $                         | 423,481 |  |                   | $ | 353,803 |               |  |  |               |  





7







(1) This debt was reclassified from current to long-term pursuant
to ASC 470-10-45-14. On May 19, 2013, this debt was refinanced through the issuance of long-term convertible notes.



In March 2012, an additional
$15,000 was advanced to the Company under the Note Purchase Agreement with Prestwick Circle Services Corp., which is currently
in default. Prestwick has defaulted on its obligation to fund an additional $200,000 under the Note Purchase Agreement.



On March 28, 2012, the
Company issued $70,000 of its convertible promissory notes (“March 2012 Notes) to four investors. The March 2012 Notes bear
interest at the rate of 8% per annum, are due on December 31, 2013 and are convertible into shares of the Company’s common
stock at the rate of $.05 per share. The March 2012 Notes will be automatically cancelled and new convertible promissory notes
issued if, in connection with a convertible debt financing of the Company after March 28, 2012 and before December 31, 2013, such
subsequent debt financing provides for a conversion price of less than $0.05 per share of Common Stock. In accordance with ASC
470-20, the Company recognized an embedded beneficial conversion feature present in the notes. The Company allocated a portion
of the proceeds equal to the intrinsic value of that feature to additional paid-in capital. The Company recognized and measured
an aggregate of $49,000 of the proceeds, which is equal to the intrinsic value of the embedded beneficial conversion feature,
to additional paid-in capital and a discount against the notes. The debt discount attributed to the beneficial conversion feature
is amortized over the notes’ maturity period as interest expense. The Company recognized a total of $7,164 of the debt discount
as interest through the second quarter, and recognized an additional $1,446 of accrued interest through the second quarter.



On April 1, 2012, the
Company defaulted in the payment of a senior secured promissory note in the original principal amount of $100,000 issued to a
lender on December 9, 2011. The secured lender has a first security interest in all of the Company’s assets.



NOTE 8 – MATERIAL SUBSEQUENT EVENTS AND CONTINGENCIES



In preparing the accompanying
consolidated financial statements, the Company has reviewed events that have occurred after June 30, 2012, through the date of
issuance of the financial statements.





8









Legal Proceedings



On July 27, 2012, we received notice that
a default judgment had been entered against the Company with respect to a civil action summons and complaint filed in the Superior
Court of New Jersey, Passaic County, for the non-payment of certain unsecured promissory notes issued by the Company’s predecessor,
DAM Holdings, Inc., in the amount of $60,965. The repayment of these notes has been guaranteed in full by a third party in connection
with the merger of OSO USA LLC into our wholly-owned subsidiary, OSO Beverages Corp. The Company intends to pursue its remedies
against such third party with respect to this judgment.



Note Conversion



On April 23, 2013, the Company exercised
its right to convert an unsecured convertible promissory note dated October 25, 2011 in the amount of $187,100 to shares of the
Company’s Common Stock at the stated conversion price of $0.135 per share. The conversion resulted in the issuance by the
Company 1,385,926 restricted shares of its Common Stock to the holder in full cancellation of the note.



Refinancing



On May 19, 2013, the Company issued a
$225,000 Secured Amended and Restated Convertible Debenture to a single lender (“Amended Note”) which amended and
restated the Company’s senior secured promissory note issued to another lender on December 9, 2011 in the original principal
amount of $100,000 (“2011 Note”). The 2011 Note had been in default since April 1, 2012. Pursuant to a Forbearance
Agreement entered into with the new lender, accrued penalties and costs of $150,000 with respect to the 2011 Note were added to
the principal of the Amended Note. The Amended Note bears interest at the rate of 20% per annum, is due on December 31, 2014 and
is, subject to certain ownership limitations, convertible into shares of the Company’s common stock. The conversion price
is equal to 50% of the volume weighted average closing market price for shares of the Company’s Common Stock for the 45
trading days preceding conversion. The secured lender has a first security interest in all of the Company’s assets



New Financing



On May 19, 2013, the Company issued a
Secured Amended and Restated Convertible Debenture in the amount of $150,000 to a single lender (“May 2013 Note”).
The May 2013 Note bears interest at the rate of 20% per annum, is due on December 31, 2014 and is, subject to certain ownership
limitations, convertible into shares of the Company’s common stock at the rate of $.02 per share. Commencing on May 15,
2014 and each month thereafter, the Company is required to pay to the lender principal in the amount of $10,000. The secured lender
has a security interest in all of the Company’s assets. In addition, the loan is secured by a pledge of 31,500,000 shares
of the Company’s Common Stock owned by the Company’s president.



Note Exchange



On June 3, 2013, the
Company issued $70,000 of its convertible promissory notes (“June 2013 Notes) to four investors. The June 2013 Notes were
issued in exchange for $70,000 of convertible promissory notes issued to these investors on March 28, 2012 (“March 2012
Notes”) pursuant to a provision in the March 2012 Notes requiring a mandatory note exchange if, in connection with a convertible
debt financing of the Company after March 28, 2012 and before December 31, 2013, such financing provided for a price at which
the new note may be converted into shares of the Company’ Common Stock of less than $0.05 per share. On May 15, 2013 the
Company engaged in a convertible debt financing in which the conversion price one of the notes is $.02 per share and the other
is variable based on a 50% discount to the volume weighted average closing market price of the Company’s stock. As a result
of these financings, the conversion price of the June 2013 Notes was reset at $.01 per share. The March 2012 and June 2013 Notes
are in all other respects identical. Interest that accrued on the March 2012 Note before the exchange may also be converted into
shares of the Company’s Common Stock at $.01 per share.





9







Authorization of
Additional Shares of Common Stock



The Company filed a
Certificate of Amendment to its Articles of Incorporation to increase the number of shares of Common Stock that could be issued
to 250,000,000 from 99,000,000. The Certificate of Amendment was effective August 12, 2013. A majority of the holders of the Company’s
Common Stock approved the Certificate of Amendment, and the Company filed a Notice by Action by Written Consent of Stockholders
with the Securities and Exchange Commission that was subsequently mailed to stockholders of record.



Production Financing



On August 23, 2013, the Company’s
wholly-owned subsidiary, OSO Beverages Corp., (“OSO”) issued $90,000 in principal amount of its secured convertible
promissory notes (“OSO Notes) to two lenders. In exchange for the OSO Notes, the Company received $60,000 in cash to be
used to purchase inventory. The repayment of the OSO Notes is secured by the inventory to be purchased and all of the proceeds
from the sale thereof. Beginning on November 15, 2013 and each month thereafter, principal in the amount of $4,500 is payable
to each lender, with all unpaid principal due and payable on August 15, 2014. The difference between the principal amount of the
OSO Notes and the amount received ($15,000 with respect to each OSO Note) will be accounted for as original issue discount. The
OSO Notes are convertible into shares of the Company’s common stock at a conversion rate of $0.01 per share. As an inducement
to enter into the loan transaction, each Lender subscribed to purchase 500,000 restricted shares of the Company’s common
stock for a nominal consideration. As a further inducement to enter into the loan transaction, Fouad Kallamni, the Company’s
President, guaranteed all payments due under each OSO Note.



10







Item 2. Management's Discussion and Analysis or Plan of
Operation



The following discussion and analysis
of our consolidated financial condition and results of operations for the six month period ended June 30, 2012 should be read
in conjunction with our consolidated financial statements included elsewhere in this Quarterly Report.



Special Filing Note



We have not yet filed the following reports
under the Securities Exchange Act of 1934:



Quarterly Reports
on Form 10-Q for the three month periods ended:



September
30, 2012



Annual Report on Form
10-K for the 12-month period ended December 31, 2012



Quarterly Reports
on Form 10-Q for the three month periods ended



March 31,
2013

June 30,
2013



We expect to file each of these reports
no later than October 31, 2013. Forward looking statements in this Quarterly Report and in the Form 10-K for the calendar year
ended December 31, 2011 have been made as though these reports had been timely filed with the Commission. In this regard, particular
care should be taken with respect to forward looking statements made herein which should be evaluated in light of “subsequent
events” disclosure in the footnotes to the financial statements accompanying this report as well as disclosure in the reports
that the Company will be filing for subsequent annual and quarterly periods described above. See “CAUTIONARY NOTICE
REGARDING FORWARD LOOKING STATEMENTS.”



Introductory Comments



On October 19, 2011, pursuant to the terms
of an Agreement and Plan of Merger between OSO USA LLC, a Delaware limited liability company and our wholly-owned subsidiary,
OSO Beverages Corp., OSO USA LLC merged into OSO Beverages Corp. OSO As a result of this merger, our historical motorcycle-related
business terminated, we changed our name to Premier Beverage Group Corp. and we are now engaged in the energy drink business described
herein.



We operate our business through our wholly
owned subsidiary, OSO Beverages Corp. and distribute our OSO products through its wholly owned subsidiary, Fury Distribution Holdings
LLC. Another subsidiary, Captive Brands Corp., is inactive. Throughout this Quarterly Report on Form 10-Q as amended, the terms
“we,” “us,” “our,” “Premier Beverage” and “our company” refer to Premier
Beverage Group Corp., a Nevada corporation, and, unless the context indicates otherwise, includes these subsidiaries for all periods
presented.



We currently have insufficient working
capital to carry on normal day-to-day operations. Although we continue to serve customers on a limited basis from existing inventory,
we are unable to purchase additional inventory or actively market our products to new accounts. We have no payroll, and current
consulting fee obligations are being accrued. Our principal focus since the end of the first quarter of 2012 has been finding
additional capital. There can be no assurance that such capital will be available as necessary to meet our working capital requirements
or, if the capital is available, that it will be on reasonable terms acceptable to us. The issuances of additional equity securities
by the Company will result in dilution in the equity interests of our current stockholders. Obtaining commercial loans, assuming
those loans would be available, will increase our liabilities and future cash commitments. If we are unable to obtain financing
in the amounts and on terms deemed acceptable, the business and future success may be adversely affected.





11







The following discussion of our plan of
operations should be read in conjunction with the foregoing statements and with the financial statements and the related notes
thereto included elsewhere in this quarterly report.



Forward Looking Statements



The Company cautions readers regarding
forward looking statements found in the following discussion and elsewhere in this report and in any other statement made by,
or on the behalf of the Company, whether or not in future filings with the Securities and Exchange Commission. Forward-looking
statements are statements not based on historical information and which relate to future operations, strategies, financial results
or other developments. Forward looking statements are necessarily based upon estimates and assumptions that are inherently subject
to significant business, economic and competitive uncertainties and contingencies, many of which are beyond the Company's control
and many of which, with respect to future business decisions, are subject to change. These uncertainties and contingencies can
affect actual results and could cause actual results to differ materially from those expressed in any forward-looking statements
made by or on behalf of the Company. The Company disclaims any obligation to update forward-looking statements.



Overview



We are a consumer brand development company
focused on creating, marketing and selling compelling functional beverage brands. Functional beverages, which include energy drinks,
energy shots, and enhanced waters, among others, have expanded substantially in the last 10 years and disrupted the beverage landscape
formerly dominated by soft drinks. The functional beverage category has uncovered a previously unexposed consumer need that traditional
beverages did not address. We believe these beverages are quickly becoming the drink of choice for the younger generation, having
matured from “fad” status into the mainstream market.



Our flagship brand, OSO, is a premium
energy beverage offered primarily to high profile on-premise accounts. “On-premise” accounts include clubs, bars,
restaurants and hotels and generally where the product is consumed at the location. OSO holds a unique position as a premium energy
beverage. With additional repackaging initiatives currently underway, OSO intends to further differentiate itself by offering
a sleek glass bottle packaging option along with a formula that is made with 100% all natural ingredients. OSO’s positioning
is sophisticated, top-shelf energy with elegant packaging, unlike mass market ‘extreme-focused’ canned energy drinks.



In addition
to OSO, we previously announced our intention to utilize our manufacturing and brand development skills to create high quality
store brands for mass retailers (which we have dubbed “captive brands”).  We will reevaluate whether this strategy
continues to be viable at such time as we may receive additional capital.

Our company is a Nevada corporation originally
formed under the name Sunrise USA Inc. on July 22, 1999. Our principal place of business is located at 501 Madison Avenue, Suite
501, New York, New York 10022. Our telephone number is (646) 820-0630.



Results of Operations



The following discussion should be read
in conjunction with our financial statements and the related notes thereto included elsewhere herein.



Three months ended June 30, 2012 compared
with three months June 30, 2011.



For the three months ended June 30, 2012
we generated revenues of $15,060 as compared to $23,184 for the three months ended June 30, 2011, a decrease of $8,124, or 35%.
Cost of goods sold for the three months ended June 30, 2012 was $3,321, generating a gross margin of $11,739. Cost of goods sold
for the three months ended June 30, 2011 was $11,035, generating a gross margin of $12,149. The decrease in our revenues is attributable
principally to lack of available inventory to sell to customers.





12







Selling, general and administrative expenses
were $126,258 for the three months ended June 30, 2012 as compared to $27,632 for the three months ended June 30, 2011, an increase
of $98,626 or 357%. This increase was primarily due to the associated costs of operating as a public company. We incurred interest
expense of $21,222 for the three months ended June 30, 2012. Interest expense incurred for the three months ended June 30, 2011
was $-0-. The increase of $21,222 in interest expense was due to higher amortization of beneficial conversion features in 2012
which did not exist in 2011.



We reported a net loss and loss applicable
to common stockholders for the three months ended June 30, 2012 of $135,886. Our net loss and loss applicable to the common stockholders
for the three months ended June 30, 2011 was $15,483. The increase in net loss was attributable principally to the lack of available
inventory to generate an increase in revenues along with additional expenses related to operating as a public company.



Six months ended June 30, 2012 compared
with six months June 30, 2011.



For the six months ended June 30, 2012
we generated revenues of $32,275 as compared to $50,083 for the six months ended June 30, 2011, a decrease of $17,808, or 36%.
Cost of goods sold for the six months ended June 30, 2012 was $12,408, generating a gross margin of $19,867. Cost of goods sold
for the six months ended June 30, 2011 was $18,487, generating a gross margin of $31,596. The decrease in our revenues is attributable
principally to lack of available inventory to sell to customers.



Selling, general and administrative expenses
were $239,143 for the six months ended June 30, 2012 as compared to $52,723 for the six months ended June 30, 2011, an increase
of $186,420 or 354%. This increase was primarily due to the associated costs of operating as a public company. We incurred interest
expense of $90,171 for the six months ended June 30, 2012. Interest expense incurred for the six months ended June 30, 2011 was
$-0-. The increase of $90,171 in interest expense was due to higher amortization of beneficial conversion features in 2012 which
did not exist in 2011.



We reported a net loss and loss applicable
to common stockholders for the six months ended June 30, 2012 of $309,737. Our net loss and loss applicable to the common stockholders
for the six months ended June 30, 2011 was $21,127. The increase in net loss was attributable principally to the lack of available
inventory to generate an increase in revenues along with additional expenses related to operating as a public company.



Liquidity and Capital Resources



Since the merger in October 2011, we have
funded our operations primarily through the issuance of debt securities in the amount of $187,100 of convertible notes issued
in connection with the merger in October 2011, $100,000 of senior convertible notes issued to an investor in December 2012, and
$70,000 of convertible notes issued to investors in March 2012. As of June 30, 2012, we had $-0- of cash on hand, $43,598 in accounts
receivable, $25,533 in inventory, and $476,499 in current liabilities.



We will require additional cash to meet our operating needs
for the next twelve months.



Item 3. Quantitative and Qualitative Disclosures about Market
Risk



Item is inapplicable.





13







Item 4T. Controls and Procedures



Fouad Kallamni, who was our principal
executive and financial officer after the merger of OSO USA LLC into the Company on October 19, 2011 and for the remainder of
the reporting period which ended on June 30, 2012, has concluded that the disclosure controls and procedures were neither effective
prior to the merger or as of June 30, 2012. These controls are meant to ensure that information required to be disclosed by the
issuer in the reports that it files or submits under the Act is recorded, processed, summarized and reported, within the time
periods specified in the Commission’s rules and forms and to ensure that information required to be disclosed by an issuer
in the reports that it files or submits under the Act is accumulated and communicated to the issuer's management, including its
principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely
decisions regarding required disclosure.



Management’s Report on Internal
Control over Financial Reporting



Our management is responsible for establishing
and maintaining internal controls over financial reporting and disclosure controls. Internal Control Over Financial Reporting
is a process designed by, or under the supervision of, our principal executive and financial officer, or persons performing similar
functions, and effected by our board of directors, management and other personnel, to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally
accepted accounting principles and includes those policies and procedures that:



|1. | Pertain to the maintenance of records that in reasonable
    detail accurately and fairly reflect the transactions and dispositions of the assets of the issuer;                                                                                                                                                                                         
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|2. | Provide reasonable assurance that transactions are recorded
    as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and
    that receipts and expenditures of the issuer are being made only in accordance with authorizations of management and directors
    of the registrant; and
|3. | Provide reasonable assurance regarding prevention or timely
    detection of unauthorized acquisition, use or disposition of the issuer’s assets that could have a material effect on
    the financial statements.                                                                                                                                      



Management conducted an evaluation of
the effectiveness of our internal control over financial reporting as of December 31, 2011, based on the framework established
in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based
on this assessment, management concluded that as of December 31, 2011, it had material weaknesses in its internal control procedures
which continue to exist as of June 30, 2012.



A material weakness is a control deficiency,
or combination of control deficiencies, in internal control over financial reporting such that there is a reasonable possibility
that a material misstatement of our annual or interim financial statements would not be prevented or detected on a timely basis.
We have concluded that our internal control over financial reporting was not effective as of December 31, 2011 and June 30, 2012.



The Company’s assessment identified
certain material weaknesses which are set forth below:



Entity Level Controls



We have insufficient corporate governance
policies. Our corporate governance activities and processes are not always formally documented. Specifically, decisions made by
the board to be carried out by management should be documented and communicated on a timely basis to reduce the likelihood of
any misunderstandings regarding key decisions affecting our operations and management.



We currently have insufficient resources
which may restrict our ability to gather, analyze and report information relative to the financial statements in a timely manner,
including insufficient documentation and review of the selection and application of generally accepted accounting principles to
significant non-routine transactions. In addition, the limited size of the accounting department makes it impractical to achieve
an optimum segregation of duties.





14







Functional Controls and Segregation
of Duties



We have an inadequate segregation of duties
consistent with control objectives. Our management is composed of a single individual resulting in a situation where no segregation
of duties exists. In order to remedy this situation we would need to hire additional staff to provide segregation of duties. Currently,
it is not feasible to hire additional staff to obtain optimal segregation of duties. Management intends to reassess this matter
during the current fiscal year to determine whether improvement in segregation of duties is feasible.



Management believes that the material
weaknesses set forth above were the result of the scale of our operations and are a circumstance due to our small size. Management
believes these weaknesses did not have a material effect on our financial results and intends to take remedial actions upon receiving
funding for our business operations.



We are committed to improving our financial
organization. As part of this commitment, we will increase our personnel resources and technical accounting expertise within the
accounting function when funds are available to us. We will continue to monitor and evaluate the effectiveness of our internal
controls and procedures and our internal controls over financial reporting on an ongoing basis and are committed to taking further
action and implementing additional enhancements or improvements, as necessary and as funds allow. We intend to take appropriate
and reasonable steps to make the necessary improvements to remediate these deficiencies, including:



|(1) | Adding personnel with the depth of knowledge and
    time commitment to provide a greater level of review for corporate activities;                     
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | Continuing to update the documentation of our internal control
    processes, including formal risk assessment of our financial reporting processes; and
|(3) | Soliciting independent directors to enhance corporate governance
    and Board composition.                                                             



We intend to consider the results of our
remediation efforts and related testing as part of our assessment of the effectiveness of our internal control over financial
reporting.



Changes in Internal Control over Financial
Reporting



There were no changes in our internal
control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) that occurred during the quarter ended
June 30, 2012, that have materially affected, or are reasonably likely to materially affect, our internal control over financial
reporting.



PART II – OTHER INFORMATION



Item 1. Legal Proceedings



On April 9, 2012, the Company was served
with a civil action summons and complaint filed in the Superior Court of New Jersey, Passaic County, with respect to the non-payment
of certain unsecured promissory notes issued by the Company’s predecessor, DAM Holdings, Inc., in the amount of $60,964.
The Company did not file an answer to this summons and complaint. The repayment of these notes has been guaranteed in full by
a third party in connection with the merger of OSO USA LLC into our wholly-owned subsidiary, OSO Beverages Corp.



Item 1A. Risk Factors



Inapplicable.



Item 2. Unregistered Sales of Equity Securities and Use
of Proceeds



None.





15







Item 3. Defaults Upon Senior Securities



On April 1, 2012, the
Company defaulted in the payment of a senior secured promissory note in the original principal amount of $100,000 issued to a
lender on December 9, 2011. The secured lender has a first security interest in all of the Company’s assets.



Item 4. Submission of Matters to a Vote of Security Holders



None.



Item 5. Other Information



None.



Item 6. Exhibits



|ExhibitNumber |  | Exhibit                                                                                                                                                                                                      
|------------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|              |  |                                                                                                                                                                                                              
|3.1           |  | Articles of Incorporation(1)                                                                                                                                                                                 
|3.2           |  | Amendments to Articles of Incorporation(1)                                                                                                                                                                   
|3.3           |  | Articles of Merger of Premier Beverage Group Corp. into DAM
    Holdings, Inc.(2)                                                                                                                            
|3.4           |  | By-Laws(1)                                                                                                                                                                                                   
|4.1           |  | Certificate of Designation Series A Preferred Stock(1)                                                                                                                                                       
|4.2           |  | Certificate of Designation Series B Preferred Stock(1)                                                                                                                                                       
|4.3           |  | Class A Warrant Agreement(3)                                                                                                                                                                                 
|4.4           |  | Form of Class A Warrant Certificate(3)                                                                                                                                                                       
|4.5           |  | Specimen Common Stock Certificate(1)                                                                                                                                                                         
|10.1          |  | 6% Convertible Promissory Notes(1)                                                                                                                                                                           
|10.2          |  | Stock Purchase Agreement(4)                                                                                                                                                                                  
|10.3          |  | Assumption and Indemnification Agreement(4)                                                                                                                                                                  
|10.4          |  | Form of Unsecured Promissory Note(4)                                                                                                                                                                         
|10.5          |  | Form of Note Purchase Agreement(4)                                                                                                                                                                           
|10.6          |  | Agreement and Plan of Merger of OSO USA LLC into OSO Beverages
    Corp.(5)                                                                                                                                  
|10.8          |  | Indemnification Agreement(1)                                                                                                                                                                                 
|10.9          |  | Form of Senior Secured Promissory Note(6)                                                                                                                                                                    
|10.10         |  | Form of Security Agreement(6)                                                                                                                                                                                
|10.11         |  | Consulting Agreement with Fouad Kallamni(1)                                                                                                                                                                  
|10.12         |  | Consulting Agreement with Core Equity Group LLC(1)                                                                                                                                                           
|10.13         |  | Consulting Agreement with Richard Fisher(1)                                                                                                                                                                  
|10.14         |  | Form of unsecured Convertible Promissory Noteissued
    in aggregate principal amount of $70,000(9)                                                                                                          
|14.1          |  | Code of Ethics(8)                                                                                                                                                                                            
|16.1          |  | Letter from Former Auditor(7)                                                                                                                                                                                
|21.1          |  | Subsidiaries of Registrant(1)                                                                                                                                                                                
|31.1          |  | Certification by Fouad Kallamni, Principal Executive
        and Financial Officer, pursuant to Rule 13a-14(a),
        pursuant
        to Section 302 of the Sarbanes-Oxley Act of 2002*                   
|32.1          |  | Certification by Fouad Kallamni, Principal Executive
        and Financial Officer, pursuant to 18 U.S.C.
        Section
        1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*



|(1) | Incorporated by reference from the Annual Report on Form 10-K for the
    year ending December 31, 2011  
|--- | ---------------------------------------------------------------------------------------------------------
|(2) | Incorporated by reference from the Current Report on Form 8-K filed on December 1, 2011                  
|(3) | Incorporated by reference from the Annual Report on Form 10-KSB for the year ending December
    31, 2007
|(4) | Incorporated by reference from the Current Report on Form 8-K filed on October 27, 2011                  
|(5) | Incorporated by reference from the Current Report on Form 8-K filed on October 24, 2011                  
|(6) | Incorporated by reference from the Current Report on Form 8-K filed on December 15, 2011                 





16







|(7) | Incorporated by reference from the Current Report on Form 8-K/A filed
    on December 23, 2011            
|--- | ----------------------------------------------------------------------------------------------------------
|(8) | Incorporated by reference from the Annual Report on Form 10-KSB for the year ending December
    31, 2005 
|(9) | Incorporated by reference from the Quarterly Report on Form 10-Q for the quarter ending
    March 31, 2012
|*   | Filed herewith.                                                                                           



SIGNATURES



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



|      |                  | Premier Beverage Group Corp.                                | 
|----- | ---------------- | ----------------------------------------------------------- | 
|      |                  |                                                             | 
|Date: | October 15, 2013 | /s/ Fouad Kallamni                                          | 
|      |                  | Fouad Kallamni, President                                   | 
|      |                  | Principal Executive Officer and Principal Financial Officer | 



17