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                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

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

                   For the quarterly period ended June 30, 2008
                                        or
         [ ]   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 000-51721

                               LIBERATOR BDC, INC.
             (Exact name of registrant as specified in its charter)

                  DELAWARE                             83-0432182
      (State or other jurisdiction of       (IRS Employer Identification No.)
       incorporation or organization)

                1 DOCK STREET
                  SUITE 525
         STAMFORD, CONNECTICUT 06902                 (203) 509-3330
   (Address of principal executive offices)  (Registrant's telephone number,
                                                   including area code)

                                       N/A
          (Former name or former address, 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 Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports) and (2) has been subject to such
filing requirements for at least the past 90 days. Yes |X| No |_|

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

     Large accelerated filer |_|                   Accelerated filer |_|

     Non-accelerated filer |_|                     Smaller reporting company |X|
     (Do not check if a smaller reporting company)

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

     As of July 31, 2008, Liberator BDC, Inc. had 3,544,117 shares of common
stock outstanding.

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<PAGE>

                               LIBERATOR BDC, INC.
                          QUARTERLY REPORT ON FORM 10-Q



                                TABLE OF CONTENTS


                                                                          Page
--------------------------------------------------------------------------------

 PART I - FINANCIAL INFORMATION

   ITEM 1.  Financial Statements
              Balance Sheets as of June 30, 2008 (unaudited) and
                December 31, 2007 .......................................   2
              Statements of Operations for the three and six months
                ended June 30, 2008 and 2007 (unaudited) ................   3
              Statements of Changes in Stockholders' Equity (Deficiency)
                for the Cumulative Period from May 26, 2005 (Inception)
                through June 30, 2008 (unaudited) .......................   4
              Statements of Cash Flows for the six months ended June 30,
                2008 and 2007 (unaudited) ...............................   5
              Notes to Financial Statements (unaudited) .................   6

   ITEM 2.  Management's Discussion and Analysis of Financial Condition
            and Results of Operations ...................................   9

   ITEM 3.  Quantitative and Qualitative Disclosures About Market Risk ..  10

   ITEM 4.  Controls and Procedures .....................................  10

 PART II - OTHER INFORMATION

   ITEM 1.  Legal Proceedings ...........................................  10

   ITEM 1A. Risk Factors ................................................  11

   ITEM 2.  Unregistered Sales of Equity Securities and Use of Proceeds .  11

   ITEM 3.  Defaults Upon Senior Securities .............................  11

   ITEM 4.  Submission of Matters to a Vote of Security Holders .........  11

   ITEM 5.  Other Information ...........................................  11

   ITEM 6.  Exhibits ....................................................  11

              Signature Page
              Exhibit 31.1
              Exhibit 31.2
              Exhibit 32.1
--------------------------------------------------------------------------------

<PAGE>

                                   LIBERATOR BDC, INC.
                                     BALANCE SHEETS
                                       (unaudited)

<TABLE>
<CAPTION>
                                                                 JUNE 30,      DECEMBER 31,
                                                                   2008            2007
---------------------------------------------------------------------------   --------------
                                                                (UNAUDITED)
<S>                                                              <C>            <C>
                              ASSETS
CURRENT ASSETS:
   Cash                                                          $  8,055       $ 41,526
   Accounts receivable                                              7,500             --
   Investments, at market                                          27,500             --
   Prepaid assets                                                      --          5,926
                                                                -----------   --------------
      Total current assets                                         43,055         47,452

Property and equipment, net of accumulated
  depreciation of $280 and $40, respectively                        2,121          2,361
                                                                -----------   --------------
      Total assets                                               $ 45,176       $ 49,813
                                                                ===========    ============

      LIABILITIES AND STOCKHOLDERS' DEFICIENCY

CURRENT LIABILITIES:
   Accounts payable                                              $ 19,909       $ 11,676
   Notes payable - related parties                                 94,500         94,500
   Accrued legal expenses                                         100,000
   Other accrued Expenses                                          13,055         15,062
                                                                -----------   --------------
      Total current liabilities                                   227,464        121,238
                                                                -----------   --------------

STOCKHOLDERS' DEFICIENCY:
   Preferred stock, $.0001 par value; 10,000,000 shares
     authorized; no shares issued                                      --             --
   Common stock, $.0001 par value; 75,000,000 shares
     authorized; 3,544,117 shares issued and outstanding              354            354
   Additional paid-in capital                                     119,158        119,158
   Accumulated deficit                                           (301,800)      (190,937)
                                                                -----------   --------------
      Total stockholders' deficiency                             (182,288)       (71,425)
                                                                -----------   --------------
      Total liabilities and stockholders' deficiency             $ 45,176       $ 49,813
                                                                ===========   ==============
</TABLE>


        SEE ACCOMPANYING NOTES TO UNAUDITED INTERIM FINANCIAL STATEMENTS.


                                              2
<PAGE>

                                       LIBERATOR BDC, INC.
                                    STATEMENTS OF OPERATIONS
                                           (unaudited)
<TABLE>
<CAPTION>
                                       THREE MONTHS ENDED           SIX MONTHS ENDED
                                            JUNE 30,                    JUNE 30,
                                   --------------------------    ------------------------
                                       2008           2007          2008          2007
                                   ------------   -----------    -----------   ----------
<S>                                <C>            <C>            <C>           <C>
Revenue - fee income               $    52,500    $       --     $   52,500    $      --
Expenses:
  General and administrative           120,482         7,225        141,762       17,981
                                   ------------   -----------    -----------   ----------
Loss before other expenses             (67,982)       (7,225)       (89,262)     (17,981)

Other expenses:
  Unrealized losses on
    investments                         17,500            --         17,500           --
  Interest                               2,049           541          4,101          655
                                   ------------   -----------    -----------   ----------

Net loss                           $   (87,531)   $   (7,766)    $ (110,863)   $ (18,636)

                                   ============   ===========    ===========   ==========

Basic and diluted loss per share   $      (.02)   $     (.01)    $     (.03)   $    (.01)
                                   ============   ===========    ===========   ==========

Basic and diluted weighted
  average number of common
  shares outstanding                 3,544,117     1,507,582      3,544,117    1,503,812
                                   ============   ===========    ===========   ==========
</TABLE>



        SEE ACCOMPANYING NOTES TO UNAUDITED INTERIM FINANCIAL STATEMENTS.


                                               3
<PAGE>


<TABLE>
<CAPTION>
                                               LIBERATOR BDC, INC.
                            STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIENCY)


                           Preferred Stock          Common Stock          Additional
                         -------------------     -------------------       Paid-in       Accumulated
                          Shares     Amount       Shares     Amount        Capital         Deficit        Total
                         --------   --------     --------   --------     ------------   --------------  ----------
<S>                           <C>    <C>        <C>          <C>          <C>            <C>             <C>
Balance, May 26, 2005         --     $   --            --    $   --       $       --     $         --    $     --

  Issuance of common
    stock on June 24,
    2005                      --         --     1,500,000       150           49,850               --      50,000
  Net loss                    --         --            --        --               --          (17,833)    (17,833)
                         --------   --------   ----------   --------     ------------   --------------  ----------
Balance, December 31,
   2005                       --         --     1,500,000       150           49,850          (17,833)     32,167

  Net loss                    --         --            --        --               --          (34,462)    (34,462)
                         --------   --------   ----------   --------     ------------   --------------  ----------
Balance, December 31,
   2006                       --         --     1,500,000       150           49,850          (52,295)     (2,295)

  Issuance of common
     stock                    --         --     2,044,117       204           31,208               --      31,412
  Compensatory charge         --         --            --        --           38,100               --      38,100

  Net loss                    --         --            --        --               --         (138,642)   (138,642)
                         --------   --------   ----------   --------     ------------   --------------  ----------
Balance, December 31,
   2007                       --         --     3,544,117       354          119,158         (190,937)    (71,425)

  Net loss
  (unaudited)                 --         --            --        --               --         (110,863)   (110,863)
                         --------   --------   ----------   --------     ------------   --------------  ----------
Balance, June 30,
  2008 (unaudited)            --     $   --     3,544,117   $   354         $119,158     $   (301,800)  $(182,288)
                         ========   ========   ==========   ========     ============   ==============  ==========




        SEE ACCOMPANYING NOTES TO UNAUDITED INTERIM FINANCIAL STATEMENTS.
</TABLE>

                                                       4
<PAGE>

                                      LIBERATOR BDC, INC.
                                    STATEMENTS OF CASH FLOWS
                                           (unaudited)

<TABLE>
<CAPTION>
                                                                  SIX MONTHS ENDED JUNE 30,
                                                            -------------------------------------
                                                                   2008                2007
                                                            -----------------    ----------------
CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                           <C>                  <C>
Net loss                                                      $  (110,863)         $  (18,636)

Adjustments to reconcile net loss to net cash
  used in operating activities:
    Depreciation                                                       240                  --
    Change in operating assets and liabilities:
      Increase in accounts receivable                              (7,500)                  --
      Increase in investments                                     (27,500)                  --
      Decrease (increase) in prepaid expenses                        5,926             (3,750)
      Decrease in accounts payable and accrued expenses            106,226                  74
                                                            -----------------    ----------------
      Net cash used in operating activities                       (33,471)            (22,312)
                                                            -----------------    ----------------

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from notes payable - related parties                           --              24,000
Proceeds from sales of common stock                                     --               1,500
                                                            -----------------    ----------------
      Net cash provided by financing activities                         --              25,500
                                                            -----------------    ----------------

Net increase (decrease) in cash and cash equivalents              (33,471)               3,188
Cash and cash equivalents at the beginning of period                41,526               3,155
                                                            -----------------    ----------------
Cash and cash equivalents at the end of period                $      8,055       $       6,343
                                                            =================    ================
</TABLE>



        SEE ACCOMPANYING NOTES TO UNAUDITED INTERIM FINANCIAL STATEMENTS.


                                               5
<PAGE>

                               LIBERATOR BDC, INC.
                 NOTES TO UNAUDITED INTERIM FINANCIAL STATEMENTS


1.  ORGANIZATION, BUSINESS AND OPERATIONS

Black Nickel Acquisition Corp. II ("Black Nickel") was incorporated in the state
of Delaware on May 26, 2005 and maintains principal offices in Stamford,
Connecticut. On November 28, 2007, Black Nickel purchased 100 shares of common
stock of Liberator BDC Inc. ("Liberator") for $1. As a result, Liberator became
a wholly-owned subsidiary of Black Nickel. On November 29, 2007, the Board of
Directors of Black Nickel approved and authorized that Liberator would be merged
with and into Black Nickel, with Black Nickel as the surviving corporation of
the merger. In connection with the merger, Black Nickel adopted Liberator's
corporate name. On December 4, 2007, Black Nickel's name was changed to
Liberator BDC Inc. (the "Company").

On January 7, 2008, the Company elected, pursuant to the filing of a Form N-54A
with the U.S. Securities and Exchange Commission (the "SEC"), to be regulated as
a business development company ("BDC"). As defined under the Investment Company
Act of 1940, as amended (the "1940 Act"), a BDC is a domestic closed-end
investment company which is operated for the purpose of making certain types of
investments and which makes available significant managerial assistance to the
companies in which it invests.

The Company was formed on May 26, 2005 and was in the development stage through
March 31, 2008. The year 2008 is the first year during which it is considered an
operating company.

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern, which contemplates the recoverability
of assets and the satisfaction of liabilities in the normal course of business.
The Company incurred net losses from May 26, 2005 (inception) through the period
ended June 30, 2008 of $301,800. In addition, the Company's activities since
inception have been financially sustained through equity and debt financing.
These factors raise substantial doubt about the Company's ability to continue as
a going concern. The ability of the Company to continue as a going concern is
dependent upon management's plan to raise additional capital from the sale of
stock, receive additional paid in capital from its existing stockholders and
ultimately, income from operations. The accompanying financial statements do not
include any adjustments that might result from the outcome of this uncertainty.

2.  BASIS OF PRESENTATION FOR INTERIM FINANCIAL STATEMENTS

The accompanying interim financial statements of the Company as of June 30, 2008
and for the three and six months ended June 30, 2008 and 2007 have been prepared
in accordance with accounting principles generally accepted for interim
financial statements presentation and in accordance with the instructions to
Regulation S-X. Accordingly, they do not include all of the information and
footnotes required by accounting principles generally accepted in the United
States of America for complete financial statement presentation. In the opinion
of management, all adjustments for a fair statement of the results of operations
and financial position for the interim periods presented have been included. All
such adjustments are of a normal recurring nature. The accompanying financial
statements and the information included under the heading MANAGEMENT'S
DISCUSSION AND ANALYSIS should be read in conjunction with the Company's audited
financial statements and related notes included in the Company's Form 10-KSB for
December 31, 2007. There have been no changes in significant accounting policies
since December 31, 2007.

3.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The accompanying financial statements are prepared in accordance with accounting
principles generally accepted in the United States. Significant accounting
policies follow:

                                       6
<PAGE>

                               LIBERATOR BDC, INC.
                 NOTES TO UNAUDITED INTERIM FINANCIAL STATEMENTS


USE OF ESTIMATES. The preparation of financial statements in conformity with
accounting principles generally accepted in the United States requires
management to make estimates and assumptions that affect the amounts of assets
and liabilities and disclosure of contingent assets and liabilities at the date
of the balance sheet and reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.

LOSS PER COMMON SHARE. Basic loss per share is calculated using the
weighted-average number of common shares outstanding during each reporting
period. Diluted loss per share includes potentially dilutive securities such as
outstanding options and warrants, using various methods such as the treasury
stock or modified treasury stock method in the determination of dilutive shares
outstanding during each reporting period. The Company does not have any
potentially dilutive securities.

FAIR VALUE OF FINANCIAL INSTRUMENTS. Current assets except for investments and
current liabilities are carried at cost, which approximates their fair value
because of their short-term maturity. Investments are carried at market. The
note payable approximates fair value based on market rates available to the
Company for financing with similar terms.

INCOME TAXES. The Company accounts for income taxes in accordance with SFAS No.
109, ACCOUNTING FOR INCOME TAXES, which requires recognition of deferred tax
liabilities and assets for the expected future tax consequences of events that
have been included in the financial statements or tax returns. Under this
method, deferred tax liabilities and assets are determined based on the
temporary differences between the financial statement and tax basis of assets
and liabilities using presently enacted tax rates in effect. Valuation
allowances are established when necessary to reduce deferred tax assets to the
amounts expected to be realized.

The Company has approximately $117,000 in gross deferred tax assets at June 30,
2008 resulting from deferred start-up costs which are capitalized and amortized
for income tax purposes and expensed for financial reporting purposes, an
increase of $43,000 for 2008. A valuation allowance has been recorded to fully
offset these deferred tax assets as the future realization of the related tax
benefits is uncertain. The difference between the statutory federal income tax
rate of 34%, state taxes net of federal benefits of 4.6%, and the effective rate
of 0% is due to the capitalization of the Company's start-up costs for tax
purposes.

RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS. On January 1, 2008, the Company
adopted Statement of Financial Accounting Standards No. 157, "Fair Value
Measurements" ("FAS 157"). There was no impact on the Company's financial
position, results of operations or cash flows at June 30, 2008 and for the six
months then ended as a result of the adoption of FAS 157.

On January 1, 2008, the Company adopted Statement of Financial Accounting
Standards No. 159, "The Fair Value Option for Financial Assets and Financial
Liabilities" ("FAS 159"). There was no impact on the Company's financial
position, results of operations or cash flows at June 30, 2008 and for the six
months then ended as a result of the adoption of FAS 159.

4.  NOTES PAYABLE

In March and April 2007, the Company entered into two loan agreements,
consisting of an $8,000 loan with a stockholder and a $16,000 loan with an
entity owned by certain stockholders of the Company. Any amounts outstanding
under the loan accrue interest at 10% per year computed on actual days
outstanding in a 365 day year. On September 5, 2007, the $16,000 loan and the
related accrued interest was due. The $8,000 loan and the related accrued
interest was due on October 27, 2007. As of August 14, 2008, these loans remain
unpaid.

                                       7
<PAGE>

                               LIBERATOR BDC, INC.
                 NOTES TO UNAUDTIED INTERIM FINANCIAL STATEMENTS


On September 28, 2007, the Company entered into two separate loan agreements of
$23,500 each with two stockholders of the Company. On October 12, 2007, the
Company entered into a separate loan agreement of $23,500, with a stockholder of
the Company. Amounts outstanding under these loans accrue interest at the rate
of 8.25% per year computed on actual days outstanding in a 360 day year. These
loans are due on the earlier of one year from issuance or on the completion of a
security offering with gross proceeds exceeding $2,000,000.

As of June 30, 2008, accrued expenses include accrued interest on the notes
payable - related parties of $7,410.

5.  RELATED PARTY TRANSACTIONS

The Company utilizes the office space and equipment of its management and one of
its stockholders at no cost. Management estimates such amounts to be immaterial.

During 2007, the Company sold an aggregate of 1,400,000 shares of its common
stock to four officers and directors of the Company for an aggregate of $9,500.
The fair value of the securities sold was based upon concurrent sales of common
stock to unaffiliated investors was $47,600 and accordingly, $38,100 was charged
to operations as compensation with the corresponding increase to additional paid
in capital.

6.  RECENT ACCOUNTING PRONOUNCEMENTS

Management does not believe that any recently issued, but not yet effective
accounting pronouncements, if adopted, would have a material effect on the
accompanying financial statements.

6.  STOCKHOLDERS' EQUITY

The Company's common stock stockholders shall be entitled to cast one vote for
each common share held at all stockholders' meetings for all purposes, including
the election of directors. The common stock does not have cumulative voting
rights.

                                       8
<PAGE>

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

THE FOLLOWING DISCUSSION SHOULD BE READ IN CONJUNCTION WITH THE INFORMATION IN
THE UNAUDITED FINANCIAL STATEMENTS AND NOTES THERETO INCLUDED HEREIN AND OUR
AUDITED FINANCIAL STATEMENTS AND MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS INCLUDED IN OUR ANNUAL REPORT ON
FORM 10-K-SB FOR OUR FISCAL YEAR ENDED DECEMBER 31, 2007.

BACKGROUND

We are a specialty finance company that provides customized financing to lower
and middle market companies within the defense, aerospace and homeland defense
industries, as well as technology or biotechnology companies that are producing
technologies that have a market within any of these industries, located
throughout the United States and, in some cases, abroad. We intend to invest
primarily in senior and subordinated debt securities of our portfolio companies
secured by first- or second-lien security interests on the portfolio company's
assets, coupled with equity interests.

Our shares are not listed on any exchange or quoted on the OTC Bulletin Board.
We have no material assets or liabilities. On January 7, 2008, we filed an
election to be regulated as a business development company (a "BDC") under the
Investment Company Act of 1940, as amended (the "1940 Act"). As a result, we
are subject to the requirements under the 1940 Act applicable to BDCs.

Previously, we were known as Black Nickel Acquisition Corp. II, a development
stage enterprise with no operations and only minimal capitalization.

PLAN OF OPERATION

We have not realized any revenues from operations since inception, and our plan
of operation for the next twelve months is to raise capital and locate suitable
investment opportunities. We may need additional cash advances from stockholders
or loans from other parties to pay for operating expenses until we consummate
successful investments. Although it is currently anticipated that we can satisfy
our cash requirements with additional cash advances or loans from other parties,
if needed, for at least the next twelve months, we can provide no assurance that
we can continue to satisfy our cash requirements for such period. Our ability to
continue as a going concern is dependent upon successful implementation of our
plan to find a suitable acquisition or merger candidate, raise additional
capital from the sale of stock and receive additional paid in capital from our
existing stockholders and, ultimately, income from operations.

RESULTS OF OPERATIONS

We were formed on May 26, 2005 and were in the development stage through March
31, 2008. The year 2008 is the first year during which we are considered an
operating company. Our operations since inception have consisted primarily of
our efforts to raise capital and locate investment opportunities. We have not
generated any revenue since our inception, and it is unlikely that we will have
any revenues unless we are able to commence successful investment opportunities,
of which there can be no assurance.

REVENUES

For the three and six months ended June 30, 2008, revenues were $52,500,
compared to no revenues received in the three and six months ended June 30,
2007.

GENERAL AND ADMINISTRATIVE EXPENSES

For the three months ended June 30, 2008, general and administrative expenses
were $120,482, compared to $7,225 for the three months ended June 30, 2007. For
the six months ended June 30, 2008, general and administrative expenses were
$141,762, compared to $17,981 for the six months ended June 30, 2007. The
increase in general and administrative expenses was due primarily to increased
legal expenses.

                                       9
<PAGE>

UNREALIZED LOSSES ON INVESTMENTS

We had unrealized losses on investments of $17,500 in the three- and six-month
periods ended June 30, 2008, compared to no unrealized losses on investments
during the three- and six-month periods ended June 30, 2007.

INTEREST EXPENSES

For the three months ended June 30, 2008, we incurred interest expenses of
$2,049, compared to interest expenses of $541 in the three months ended June 30,
2007. For the six months ended June 30, 2008, we incurred interest expenses of
$4,101, compared to interest expenses of $655 in the six months ended June 30,
2007. Interest expense increased primarily as a result of additional loans
received by the Company in September 2007 and October 2007.

NET LOSS

For the three months ended June 30, 2008, we had a net loss of $87,531, compared
to a net loss of $7,766 for the three months ended June 30, 2007. For the six
months ended June 30, 2008, we had a net loss of $110,863, compared to a net
loss of $18,636 for the six months ended June 30, 2007.

LIQUIDITY AND CAPITAL RESOURCES

Cash used in operating activities was $33,471 in the six months ended June 30,
2007, compared to $22,312 in the six months ended June 30, 2008. The difference
was due primarily to the increases in general and administrative expenses,
accounts receivable and investments, partially offset by increases in
depreciation, prepaid expenses and accounts payable and accrued expenses. We had
$27,500 of investments at June 30, 2008, compared to no investments at June 30,
2007. There were no cash flows from investing activities in either the six-month
period ended June 30, 2008 or the six-month period ended June 30, 2007. There
were no cash flows from financing activities in the six months ended June 30,
2008, compared to cash provided by financing activities of $25,500 in the six
months ended June 30, 2007. The difference in cash flows from financing
activities is due to the receipt of $24,000 in loans and $1,500 from sales of
common stock in the six months ended June 30, 2007, compared to no loans
received or sales of common stock in the six months ended June 30, 2008.

Since our inception, we have funded our cash operating requirements through the
sale of our common stock and loans from our stockholders and an entity
affiliated with certain of our stockholders. As of June 30, 2008, we had an
aggregate of $94,500 of principal outstanding under such loans.

During 2007, we entered into two loan agreements. One of the loan agreements
evidenced a $16,000 loan from an entity owned by certain of our stockholders,
and the other loan agreement evidenced an $8,000 loan from one of the
stockholders. Both loan agreements provide that any amounts outstanding under
the loan will accrue interest at the rate of 10% per year computed on actual
days outstanding in a 365-day year. The $16,000 loan and the related accrued
interest became due and payable in September 2007. The $8,000 loan and the
related accrued interest became due and payable in October 2007. As of August
13, 2008, these loans remain unpaid. Each of the lenders under these loan
agreements has agreed to waive any events of default under these loan agreements
occurring as a result of our failure to pay the respective principal and related
accrued interest in full at the time such amounts originally became due.

In September 2007, we entered into two separate loan agreements, each evidencing
a $23,500 loan from a separate stockholder of the Company. In October 2007, we
entered into a loan agreement evidencing an additional $23,500 loan from a
stockholder of the Company. Amounts outstanding under each of these loans accrue
interest at the rate of 8.25% per year computed on actual days outstanding in a
360-day year. Each of these loans is due on the earlier of one year from the
date of the loan or on our completion of an offering of securities for gross
proceeds exceeding $2,000,000. After the occurrence of an event of default under
any of these loans, which in each case would include upon our failure to pay the
entire principal amount of the loan when due and payable, interest would accrue
at an annual rate of 18%.

We would be unable to fully repay our current obligations through our existing
assets or cash. In order to acquire additional funding, we may be required to
incur additional loans from stockholders or otherwise or to issue shares of our

                                       10
<PAGE>

common stock, which will dilute the interest of current stockholders. We
additionally may pursue additional financing through traditional bank financing
or a debt or equity offering. Because we have no historical revenues, we may be
unsuccessful in obtaining any such financing on favorable terms, if at all. In
the event that we do not receive financing or our financing is inadequate, we
may have to significantly reduce or eliminate our operating activities so as to
reduce operating costs.

CONSULTING AGREEMENT

In April 2008, we entered into a Consulting Agreement (the "HealthSport
Agreement") with HealthSport, Inc. ("HealthSport"). Pursuant to the HealthSport
Agreement, we have agreed to provide HealthSport during the term of the
HealthSport Agreement with certain deal sourcing and managerial assistance.
Under the HealthSport Agreement, we receive a monthly consulting fee and a 5%
commission on all HealthSport sales in excess of $500,000 over the first three
years of the Consulting Agreement through our efforts. Upon execution of the
HealthSport Agreement, we were issued 125,000 shares of HealthSport common
stock; we are entitled to an additional 125,000 shares of HealthSport common
stock in the event that HealthSport is successful in receiving a contract from
any branch of the government. The HealthSport Agreement will continue for one
year following its execution, unless terminated earlier by one or both of the
parties. Either party may terminate the HealthSport Agreement upon 90 days'
prior notice to the other, although either HealthSport or the Company may
terminate the agreement with less notice in the event of a material breach of
the agreement by the other party.

OFF-BALANCE SHEET ARRANGEMENTS

None.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS

Not required

ITEM 4. CONTROLS AND PROCEDURES

   CONCLUSION REGARDING THE EFFECTIVENESS OF DISCLOSURE CONTROLS AND PROCEDURES

We maintain disclosure controls and procedures that are designed to ensure that
information required to be disclosed in our reports filed pursuant to the
Exchange Act, is recorded, processed, summarized and reported within the time
periods specified in the Securities and Exchange Commission's (the "SEC") rules,
regulations and related forms, and that such information is accumulated and
communicated to our principal executive officer and principal financial officer,
as appropriate, to allow timely decisions regarding required disclosure.

As of June 30, 2008, we carried out an evaluation, under the supervision and
with the participation of our management, including our principal executive
officer and principal financial officer, of the effectiveness of the design and
operation of our disclosure controls and procedures. Based on this evaluation,
our principal executive officer and principal financial officer concluded that
our disclosure controls and procedures were effective as of the end of the
period covered by this report.

   CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

There have been no changes in our internal controls over financial reporting or
in other factors during our most recent fiscal quarter that could significantly
affect these controls and procedures during the quarter ended June 30, 2008.


PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

To the best knowledge of the officer and directors, the Company is not a party
to any legal proceeding or litigation. From time to time, lawsuits and claims
may be asserted against us relating to the conduct of our business, including

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<PAGE>

routine litigation relating to commercial and employment matters. The outcome of
any litigation cannot be predicted with certainty, and some lawsuits, may be
determined adversely to us. The resolution in any quarter of one or more of
these future matters may have a material adverse effect on our results of
operations for that period.

ITEM 1A.  RISK FACTORS

In addition to the other information set forth in this report, you should
carefully consider the factors discussed in Part I, Item 1 of our Annual Report
on Form 10-KSB for our fiscal year ended December 31, 2007, which could
materially affect our financial condition or future results. The risks described
in our Annual Report on Form 10-KSB are not the only risks facing us. Additional
risks and uncertainties not currently known to us or that we currently deem to
be immaterial also may materially adversely affect our future financial
condition and/or operating results.

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

None.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

The disclosure presented under Part I, Item 2, Management's Discussion and
Analysis of Financial Condition and Results of Operations - Liquidity and
Capital Resources, is incorporated herein by reference.

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

None.

ITEM 5.  OTHER INFORMATION

None.

ITEM 6. EXHIBITS

      Exhibit                              Description
    -----------    -------------------------------------------------------------
*         3.1       Certificate of Incorporation, as filed with the Delaware
                    Secretary of State on May 26, 2005.

*         3.2       By-Laws.

         31.1       Certification of the Company's Principal Executive Officer
                    pursuant to Section 302 of the Sarbanes-Oxley Act of 2002,
                    with respect to the registrant's Quarterly Report on Form
                    10- Q for the quarter ended June 30, 2008.

         31.2       Certification of the Company's Principal Financial Officer
                    pursuant to Section 302 of the Sarbanes-Oxley Act of 2002,
                    with respect to the registrant's Quarterly Report on Form
                    10- Q for the quarter ended June 30, 2008.

         32.1       Certification of the Company's Principal Executive Officer
                    and Principal Financial Officer pursuant to 18 U.S.C.
                    Section 1350, as adopted pursuant to Section 906 of the
                    Sarbanes Oxley Act of 2002.

  *   Filed as an exhibit to the Company's registration statement on Form
      10-SB, as filed with the SEC on January 12, 2006, and incorporated
      herein by this reference.

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                                   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.


                                              Liberator BDC, Inc.



            Date:  August 14, 2008       By:  /s/ Edward J. Wegel
                                              --------------------------------
                                              Edward J. Wegel
                                              Chief Executive Officer (Principal
                                              Executive Officer, Principal
                                              Financial Officer and Principal
                                              Accounting Officer)

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