<PAGE>

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

                                  FORM 10KSB/A

       [ ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
                              EXCHANGE ACT OF 1934
                  For the fiscal year ended September 30, 2004

     [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
                              EXCHANGE ACT OF 1934
            For the transition period from _________ to ____________

                          Commission File No. 000-33389
                                              ---------

                              MORGAN BEAUMONT, INC.
                              ---------------------
             (Exact name of Registrant as specified in its charter)

                  NEVADA                                 65-1071956
                  ------                                 ----------
      (State or other jurisdiction of                 (I.R.S. Employer
      incorporation or organization)               Identification Number)

           6015 31ST STREET EAST,
             BRADENTON, FLORIDA                           34203
             ------------------                           -----
  (Address of principal executive offices)              (Zip Code)

       Registrant's telephone number, including area code: (941) 753-2875
                                                           --------------

        Securities registered pursuant to Section 12(b) of the Act: none

Securities registered pursuant to Section 12 (g) of the Act: 170,000,000 common
shares par value $0.001 per share

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

Check if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B is not contained in this form, and no disclosure will be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB. [ ]

Revenues for the fiscal year ending September 30, 2004 were $58,602.


The aggregate market value of the voting stock held by non-affiliates computed
by reference to the last reported sale price of such stock as of December 28,
2004, the date of original filing, was $32,616,080 and as of the date of the
filing of this Amendment on October 18, 2005, it was $27,775,957.

The number of shares of the issuer's Common Stock outstanding as of December 22,
2004 is 47,150,070. As of the filing of this Third Amended Report, the Company
had 60,382,517 shares outstanding.

Transitional Small Business Disclosure Format (check one): Yes [ ] No [X]


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<PAGE>

                                     PART I

DESCRIPTION OF BUSINESS

Certain statements contained in this Form 10-KSB constitute "forward-looking
statements" within the meaning of Section 27A of the Securities Act of 1933, as
amended (the "Securities Act"), and Section 21E of the Securities Exchange Act
of 1934 (the "Exchange Act"). These statements, identified by words such as
"plan", "anticipate," "believe," "estimate," "should," "expect" and similar
expressions, include its expectations and objectives regarding the Company's
future financial position, operating results and business strategy. These
statements reflect the current views of management with respect to future events
and are subject to risks, uncertainties and other factors that may cause the
Company's actual results, performance or achievements, or industry results, to
be materially different from those described in the forward-looking statements.
Such risks and uncertainties include those set forth under the caption
"Management's Discussion and Analysis or Plan of Operation" and elsewhere in
this Form 10-KSB. The Company does not intend to update the forward-looking
information to reflect actual results or changes in the factors affecting such
forward-looking information. The Company advises you to carefully review the
reports and documents it files from time to time with the Securities and
Exchange Commission ("SEC"), particularly its quarterly reports on Form 10-QSB
and its current reports on Form 8-K, and the exhibits filed with or referred to
in those reports.

As used in this annual report, the terms "we", "us", "our", "MBI", "Morgan
Beaumont", and the "Company" mean Morgan Beaumont, Inc. unless otherwise
indicated. All dollar amounts in this annual report are in U.S. dollars unless
otherwise stated.

Morgan Beaumont filed a definitive information Statement on Schedule 14C with
the Securities and Exchange Commission on July 6, 2004 (the "Information
Statement"). Reference is also made to the Information Statement for a
description of the business of the Company, the new Board of Directors and
management of the resulting corporation.

COMPREHENSIVE SUMMARY AND UPDATE
--------------------------------

The Company sells debit cards, prepaid phone cards and long distance services.
The Company initially sold its products only to distributors which placed cards
with retailers. The Company has recently begun selling directly to retailers as
well. The Company also provides software and services for the processing of
debit card transactions. The Company is gradually expanding its marketing and
sales of cards directly to retailers. The Company markets debit cards
predominantly under the Morgan Beaumont name and a limited number under the
Pronto Banco name, and it privately labels debit cards for others. The Company
developed the software necessary for money to be loaded onto debit cards at
numerous banks, stores and other locations, which utilizes otherwise
incompatible operating systems. The Company refers to these retail locations
where money can be loaded onto its cards or where its cards are sold as "points
of presence" or "POPs." The relationship with some of the POPs was established


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through distributors or created at facilities owned by the distributors. Most
POPs however are a direct relationship between the Company and banks and other
financial transaction companies like Western Union. Some but not all of the POPs
sell the Company's cards, but all can load money onto the Company's cards. The
Company's software allows banks, financial services companies, retailers and
other POPs to communicate debit card transactions. The Company gives the
software away for free, but charge the card user a use fee each time a
transaction is processed. The Company has only recently introduced prepaid phone
cards and the sale of long distance telephone services. The Company's revenues
are presently almost entirely from the wholesale sales of its debit cards to
distributors and the wholesale of long distance telephone services. The Company
is establishing a network of direct and indirect relationships with its POPs.
The Company continues to grow its number of POPs; however, it believes that if
its systems are widely adopted by others within its industry, usage revenues
from the use of its integrated software applications may eventually surpass
revenues from debit and prepaid card sales.

The Company's debit cards are presently sold to distributors that primarily
target the sub-prime credit market, which consists primarily of those consumers
who cannot qualify for a credit card or bank account or who are otherwise
unattractive to banks, such as people who are immigrants, recently divorced,
young or have no credit history or very low income. The Company also began
marketing payroll cards directly to certain large employers. The Company has an
interactive voice response activation system for automated activation of cards
and customer relationship management technology. The Company also developed its
networking software that supports a network to allow cash to be loaded on to
cards, which it has branded the "SIRE" Network. The Company was incorporated in
July 11, 2000 and spent the period from incorporation until January 2005
developing its systems, establishing load location relationships and attempting
to execute its business plan. The Company began selling debit cards in September
2002, then discontinued sales in the fall of 2003 and resumed card sales again
in January 2005.

The Company generates revenue from the sale of its two primary debit cards, its
"Morgan Beaumont Debit Money Card" and its "Morgan Beaumont Stored Value
MasterCard." Card distributors or, in some cases, retailers, acquire the cards
from the Company, and agree to pay it a monthly maintenance fee associated with
keeping cards active and a transaction fee each time the card is used. The
Company can also generate fee based revenue through its SIRE Network when
consumers load cash into their card account so the card can be used for day to
day purchases.

As of October 1, 2005, the Company had approximately 81,000 POPs under contract
in 48 states, of which 11,000 were operational and the balance were expected to
be operational within the next 90 days. The Company anticipates at least an
additional 19,000 locations to be under contract within the next 90 days. It has
sold 104,635 debit cards since January 1, 2005, of which approximately 400 have
been activated and the vast majority of which have yet to be activated and are
being held by its distributors until they roll out their individual marketing
campaigns.

The Company's prepaid phone cards are presently sold to retailers and to prepaid
phone card distributors on a wholesale basis. These resellers are attracted to
the Company's phone cards due to their branded packaging, profitability and ease
of use. Through direct telemarketing efforts to retailers, the Company recently


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<PAGE>

began to sell its own prepaid phone cards directly to retailers in transactions
for which it anticipates much better margins. By concentrating on these two
segments of the marketplace, the Company maximizes its profitability, generates
repeated sales and continually increases its revenues. Additionally, the Company
sells a small portion of its cards directly to consumers via the firm's Internet
presence and website. The Company is the exclusive provider to Latin.com
Enterprises Inc., a company dedicated to the sale of phone cards and Internet
services at airports.

The Company's recent acquisition and implementation of a number of telephone
switches, routes and other rights from MTel Communications has given it the
ability to offer prepaid phone cards and sell telephone traffic or usage time on
a wholesale basis to others who sell their own prepaid phone cards or long
distance telephone services. The Company purchased and deployed the assets in
the quarter ended June 30, 2005. It agreed to pay $200,000 and issue 863,636
shares of its restricted common stock for the communication assets. The Company
is preparing to offer debit cards that can also be used as phone cards that
utilize its telephone switches and long distance routes. The Company generated
$235,695 in revenue from its telephone services in the quarter ended June 30,
2005 against $229,299 in costs. The Company believes it needs to continue to
generate prepaid phone card sales as well as wholesale route and switch long
distance services cards to retailers is more profitable but wholesale of long
distance services increases volume of its sales. The more volume of minutes the
Company carries over its switch and routes, the better rates the Company
receives from carriers. For the most recent quarter, the Company's revenues from
phone cards was $77,582 and its revenue from wholesale usage was $158,112. The
Company intends to continue to grow its telephone services and presently
anticipate that its telephone services revenue will roughly equal its Debit card
revenues for the next fiscal quarter.

HISTORICAL OVERVIEW

Since the Company's incorporation in 2000 until late in 2004, it had primarily
been in the formational process. The Company has been developing systems leaving
the complexities of the debit card market, and developing its relationships with
banks, distributors, processors and points of presence. Since inception the
Company has suffered from lack of operating capital which has slowed our
development. Its first significant operating capital came as part of the merger
with Pan American Energy Corporation. The status as a publicly trading company
allowed the Company to more easily locate additional funding for its operations.
The Company has had limited card services and sales of approximately $355,900 in
2003, but never had a substantial number of POPs and card sales until various
contracts became effective starting in January 2005.

MATERIAL RELATIONSHIPS

The Company's material contracts and relationships fall into the five main
categories of:

     o    BANKS, The Company issues cards or card programs that it sells to
          distributors or others.
     o    PROCESSORS, who collect the money and handle the financial
          transactions among the banks and the cardholders and the card
          distributors.


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<PAGE>

     o    DISTRIBUTORS, who structure the type of card programs they want and
          sell the cards to end users or other sub distributors.
     o    POINTS OF PRESENCE (POPS), which are card sales and load locations.
     o    CARD ASSOCIATION COMPANIES, such as MasterCard and Visa, which sponsor
          certain types of card issuances.

The responsiveness, technical and sophistication and procedural experience of
the Company's material relationships varies greatly. The Company has in the past
and continues to experience delays in the roll out of its card programs and the
failure to it business associates to promptly implement sales programs and
technology. While the Company has a commitment for nearly 100,000 POPs, less
than 15% are fully functional. Delays in implementation have resulted from the
lack of technical sophistication of the owners of the POPs to dedicate adequate
internal resources to the programs and outdated equipment utilized by certain
POPs. Likewise, certain banks have failed to obtain a MasterCard or Visa
approval of card programs to which they have committed because they lacked the
sophistication or dedication of resources to complete the necessary
documentation. The Company continues to seek more qualified and dedicated
relationships and to work with its existing relationships to assist where
possible.

The Company attempts to identify a demand for a particular type of card program
based upon its understanding of the marketplace or direct requests from
customers. When the Company develops or structures a card or card program, it
attempts to match that program with a bank which is best suited for the
particular card terms and users. Once a bank approves a program, it will refer
the Company to the processors with which it does business. There are no regional
or national restrictions on the issuing banks or processors. Some banks however
cannot support large numbers of retail transactions but would prefer payroll or
other programs. Likewise, certain processors desire to handle large numbers of
retail transactions while others might be better suited for payroll. Some banks
are not big enough to handle large card programs, while larger banks may not
offer as favorable of pricing as the smaller banks.

The Company currently has three to five key relationships in each of the five
main categories, which break down as follows.

<TABLE>
----------------------------------------------------------------------------------------------------------------
Banks                  Processors           Distributors            POPs                   Credit Cards
----------------------------------------------------------------------------------------------------------------
<S>                    <C>                  <C>                     <C>                    <C>
1. First Gulf Bank     1. WildCard          1. Prime Source         1. Western Union       1. MasterCard
2. Bank First          2. Symmetrex         2. CGS Financial        2. Transaction         2. Visa
3. MetaBank            3. First Data        3. Bostrom                 Management          3. Discover Card
4. First Federal       4. National Card        International        3. CGS
   Bank                   Services             Group                4. IPP
                                            4. Network              5. Bank of America
                                               Management, Inc.     6. Money Gram
                                            5. Acosta               7. IPrepay
                                            6. Virtual Lending
                                               Services
                                            7. IPrepay
----------------------------------------------------------------------------------------------------------------
</TABLE>


                                       5


<PAGE>

The Company's annual report on Form 10-KSB provides a detailed analysis of the
type of transactions and business the companies listed above primarily handle.
The Company continues to add banks, processors and distributors and it is
negotiating with Discover card to offer programs through them and negotiations
with Visa to increase its level of approval from an independent service
organization to a third party processor. Certain relationships may fall into
more than one category, such as IPrepay which has its own terminal in certain
retailers. The level of importance of a particular relationship also changes
periodically as some contracts and relationships become more or less important
in that period.

RECENT HISTORY OF LOSSES, ACCUMULATED DEFICIT AND ANTICIPATION OF FUTURE LOSSES

The Company has incurred significant losses since its inception, and it expects
to have ongoing requirements for additional capital investment to implement its
business plan. In addition, the Company's ability to continue as a going concern
must be considered in light of the problems, expenses and complications
frequently encountered by entrance into established markets and the competitive
environment in which it operates. The Company suffered recurring losses from
operations including a net loss of $1,031,335 for the nine months ended
September 30, 2004 and $3,072,514 for the nine months ended June 30, 2005.
Operating expenses for the nine months ended June 30, 2004, including non cash
items of $510,236, were $1,118,671. Operating expenses for the nine months ended
June 30, 2005 including non cash items of $558,228 were $3,745,163. As of June
30, 2005, the Company had an accumulated deficit of $5,655,603 which includes
non cash items from inception of $1,835,543. The Company has not achieved
profitability in any quarterly or annual period since inception and it expects
to continue to incur net losses for the foreseeable future. Although revenues
have grown in certain recent quarters, the Company cannot be certain that it
will be able to sustain these growth rates or that it will obtain sufficient
revenues to achieve profitability. Even if the Company does achieve
profitability, it cannot be certain that it can sustain or increase
profitability on a quarterly or annual basis in the future. The Company expects
that costs and expenses will continue to increase in future periods, which could
negatively affect future operating results.

DESCRIPTION OF PRODUCTS AND SERVICES
------------------------------------

DEBIT CARD PRODUCTS
-------------------

THE MORGAN BEAUMONT MONEY CARD (THE "MONEY" CARD) IS AN ATM AND DEBIT CARD. The
Morgan Beaumont Money Card is an ATM/Debit card that allows the user/consumer to
withdraw cash at over 750,000 ATM's or make purchases at more than 5,500,000
merchants worldwide. The Morgan Beaumont Money Card can be used at any location
on the Cirrus or Maestro ATM network and at restaurants, gas stations, car
rentals and other locations utilizing credit card services or with ATM
functions. Certain characteristics of the card are:

     o    the card is PIN activated and balances/transactions can be checked at
          any ATM on the Cirrus and Maestro network, as well as via the Internet
          or by a toll free phone call;
     o    the card is anonymous; they do not require a name to be embossed on
          the card;
     o    the card is available in a one or two card set;


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<PAGE>

     o    the card can be used for money transfers or to withdraw cash via ATM
          network, a debit card at retail locations worldwide or as a payroll
          card;
     o    the card can be loaded with money from any where in the world via the
          Internet or by Cashier's Check or Money Orders via mail; and
     o    the transaction accounts are registered and FDIC insured.

Many in the sub prime market have a need to transfer money from the United
States to their homes and families in Mexico, Asia and South America. Funds may
be transferred from one card to another by telephone. A funds transfer on a
Morgan Beaumont Money Card may be executed from one card to another for as
little as $2.00. The Company has targeted several key markets for distribution
of the Money Card, such as convenient stores, check cashing stores and payroll
services. The Company did not sell any cards to these markets during the period
covered by this report. The Company began sales to distributors targeting these
markets in 2005. The Company hopes to establish sales directly to retailers in
the future.

Management of the Company also intends to market that the Morgan Beaumont Money
Card to employers and payroll services, both domestically and internationally,
as a low cost means of paying employees instead of a check. Since the fiscal
year end, the Company has been negotiating with certain large employers for the
sale of payroll cards and anticipates entering into contracts before September
30, 2005.

THE MORGAN BEAUMONT STORED VALUE CARD (THE "STORED VALUE" CARD) IS A TRUE
PREPAID DEBIT CARD. The Morgan Beaumont Stored Value MasterCard and Visa is a
prepaid debit card that can be used anywhere MasterCard or Visa is displayed
worldwide. The cardholder determines the spending limits by the amount loaded on
the card. Certain characteristics of the card are:

     o    the card includes either a VISA or MasterCard hologram on the front of
          the card and can be used worldwide anywhere Master Card and Visa are
          accepted;
     o    the card is PIN activated and balances can be checked at any ATM, by a
          toll free phone call or via the Internet;
     o    the card is not anonymous. The holders name is embossed on the card
          and is widely recognized as an instrument of payment for goods and
          services;
     o    the card is primarily a prepaid debit card, but can be used as an ATM
          card, charge card or debit card (i.e. either pin based or signature
          based); and
     o    the card can be used as a payroll card.

PREPAID PHONE CARD PRODUCTS
---------------------------

THE MORGAN BEAUMONT PREPAID PHONE CARD IS A PREPAID PHONE CARD AND LONG DISTANCE
CARD which incorporates a toll-free access number and a PIN (Personal
Identification Number) printed on an array of branded phone cards. Purchasers of
these prepaid phone cards are able to place international calls from 35
countries and domestic long distance calls from any touch-tone phone in the
Continental United States at favorable rates. Management believes that the
branded cards, in conjunction with the Company's business model and successful
sales programs internationally, will allow the Company to more effectively
penetrate the marketplace for both phone, stored value cards and create a
growing base of loyal, repeat customers.


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The Company is moving to link prepaid calling cards with mobile phone handsets,
thereby leveraging its distribution to take advantage of the growing demand for
prepaid cellular services. The use of mobile phones has quickly expanded in the
past three years, and is predicted by many experts to continue growing
exponentially. As a result, there is an opportunity to enter the
prepaid-cellular market through branded handset/calling card combinations. These
intelligent handsets are coded to be used with MBI Services Group calling cards
exclusively, and will provide the Company with a recurring revenue stream as
customers with handsets "recharge" their account by purchasing new MBI Services
Group calling cards or recharging existing cards.

SERVICES
--------

MORGAN BEAUMONT, INTERACTIVE VOICE RESPONSE ("IVR") FARM AND SOFTWARE SOLUTIONS.
The Company acquired Typhoon Technologies, Inc. ("Typhoon") in December 2003 and
merged it into the Company. Typhoon had proprietary technology that was at one
time considered by the Company to be an integral part of the Company's
development and operation of an IVR "farm" for the service of its customers, as
well as competitive companies.

The IVR Activation System is the most common method of providing first level
customer service for products which the consumer calls to receive information
regarding card balance, recent activity and other commonly asked questions. The
Company did not receive any direct revenue from this feature in the year ended
September 30, 2004 and does not anticipate any direct revenue from this feature
in the future. The Company considers this technology to be useful, but no longer
considers it to be a critical or material component of its business.

VALUE LOAD ("SIRE") NETWORK. The Company has labeled its platform for cash
loading and payment locations as the SIRE Network. The SIRE Network provides a
brand name, look and feel for the Company's technology platform and network of
retail load locations. The SIRE network is open technology that allows multiple
card issuers, once certified, to load cards onto a national platform and
ultimately as a national payment platform for goods and services. This platform
connects the POPs with the Company, the bank and the processor. As use of the
Company's cards, or the SIRE network by others increases, the Company
anticipates revenue from this source could exceed sale of card sales.

POINTS OF PRESENCE
------------------

As part of the branding initiative, the Company's network of POPs locations was
targeted to reach at least 100,000 locations by year-end 2005. In the year ended
September 30, 2004, the Company had less than 10,000 load locations under
contract and had less than approximately 10,000 POPs operational. As of October
1, 2005, the Company had in excess of 81,000 POPs under contract not including
MoneyGram's 25,000 locations and anticipated signing of the agreement with
MoneyGram, which would increase that number to over 100,000. Of those locations,
approximately 11,000 are up and operational. The 45,000 Western Union locations


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are working through the technical interface and are anticipated to be online in
late October 2005. The table below provides the number of POPs as of October 1,
2005 under contract, that are operational as of October 1, 2005 and which are in
beta testing, in a roll out phase or in engineering development.

POPS UNDER CONTRACT AS OF OCTOBER 1, 2005
-----------------------------------------

       In Person Payment               3,000
       Transaction Management          1,400
       NMI                             6,000
       MoneyGram (1)                  25,000
       CGS                               100
       iPrePay                        20,000
       Western Union                  45,000
       Bank Of America                 5,880
                                       -----

            Total (1)                106,450

POPS THAT WERE OPERATIONAL AS OF OCTOBER 1, 2005
------------------------------------------------

       In Person Payment               3,000
       CGS                               100
       Transaction Management          1,470
       iPrePay                         1,000
       Bank Of America                 5,880
                                       -----

             Total (2)                11,400

(1) The MoneyGram contract has been submitted to the Company's attorneys for
approval but not yet signed.
(2) The Deficit from the numbers described on the Company's second amendment to
the Form 10-KSB/A filed with the SEC on September 9, 2005 was caused by a
reduction of over 12,000 Bank of America locations. The original 18,000
locations included ATM sites that we are not certain have capacity to accept
value load deposit.

POPS UNDER CONTRACT, BUT NOT OPERATIONAL, POPS WHICH ARE IN BETA TESTING, IN A
------------------------------------------------------------------------------
ROLL OUT PHASE, OR IN ENGINEERING DEVELOPMENT
---------------------------------------------

      IPrepay                   19,000        iPrePay is experiencing delays in
                                              implementing due to lack of market
                                              acceptance by its customers of the
                                              new more expensive terminal
                                              necessary to load the Company's
                                              cards

       Western Union            45,000        Working the technical interface
                                              anticipated to be done by
                                              mid-October


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<PAGE>

       NMI                       6,000        The customer is in the process of
                                              buying a software download program
                                              to push information all there
                                              locations

       CGS                       4,900        In development
                                 -----

       Total                    74,900



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<PAGE>

MECHANICS OF PRODUCTS AND SERVICES

The Morgan Beaumont Money and Stored Value Card are printed at a facility that
has been authorized by the card association under which the card is issued such
as MasterCard or Visa. The printing of the cards can only take place once the
card program has received approval from:

     (1)  the card association,
     (2)  the issuing bank, and
     (3)  the issuing processor.

The cards are provided to consumers in a retail sale transaction for ordinary
debit cards and provided by the employer for payroll cards. The specific method
will depend on the type of card the consumer obtains.

     1. Debit Card - This card product is one the consumer may purchase over the
counter at a retail merchant such as a convenience store, grocery store or
similar merchant. This type of card product is readily available and may be
packaged in a manner that allows the product to be displayed to the consumer so
they are able to clearly understand the basic features and benefits of the card
product prior to purchase.

     2. Payroll Card - This card product is typically not purchased by the
consumer, but is provided by an employer as a means for the employer to directly
deposit a consumer's paycheck for them, rather than writing a paycheck. The
packaging of this card product will be less informative, but it will contain
documents clearly outlining the usage of the card as a payroll device.

There are fees the consumer pays for use of these card products. The fees for
the payroll card may be lower for certain types of activities than for an
ordinary debit card. In all cases, the issuing processors are responsible for
debiting the cardholder account for the correct fees. These fees are to be
distributed to the Company and other entities to pay for the services rendered
for those fees.

All record keeping for this activity is kept at the issuing processor's data
center and is sent to the Company's data center for monthly reconciliation.

The functions for loading money to the card, including banking functions, money
movement and other details are described below:

HOW THE CARD WORKS
------------------

Consumer to Merchant Transaction:

1. Presentation. Consumer presents card to merchant, merchant swipes card
through magnetic reader and is presented with a menu.


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<PAGE>

2. Loading. Merchant selects "load" option, and indicates the load amount. POS
sends information to a Data Center to verify the POS device is authorized for
use.

3. Verification and Authorization. The Data Center checks POS device ID to
verify that the device is valid.

If the above POS device login is authorized, the Data Center does propriety
functions to verify the card is valid: (i) card active Y/N, (ii) Load velocity
check within program parameters Y/N and (iii) Load amount within min/max
parameters for program Y/N.

4. Approval. If the POS device receives an "accept" message, the merchant
accepts the cash from the consumer and is presented with another menu choice. If
the device receives a "decline" message, the merchant is given some kind of
detail on why the transaction was declined.

If the error message was POS device or merchant specific, the message indicates
the consumer should attempt to locate another load location or return later. If
the error message due to a velocity issue on the card account, or other
Processor related issue, the message indicates the consumer should call the
processor customer service group. If the error message was of a technical
nature, the message indicates the merchant should attempt the load again, or
should contact the technical support group at the number they have been
instructed to use.

5. Load Amount Verification. The menu presented asks the merchant to verify the
cash load amount by viewing the dollar amount shown on the POS device, and
pressing a key to ACCEPT or RE-ENTER.

6. Transmission. If the merchant chooses RE-ENTER, they are asked to re-key the
dollar amount of the load, then verify as indicated above. If the merchant
chooses ACCEPT, the data is sent to the Data Center.

7. Receipt. The merchant prints a receipt for the consumer with load value, load
location address and name, and time and date stamp of the transaction.

The consumer is responsible for reviewing the load receipt to verify accuracy of
the load value prior to leaving the merchant location. The merchant assumes
responsibility for accuracy of the load value entered by their employees. If the
consumer has a dispute at the time of load, the merchant will typically use the
standard procedure for balancing their cash drawer against possible inaccurate
entries. If the consumer has a dispute after the fact, (checking balance hours
or days later, reviewing the receipt after leaving the store, etc.), the
consumer and merchant are responsible for resolving the disputed transaction.

8. Transaction Registration. The merchant rings the cash value of the load into
their cash drawer.

9. Deposit. The merchant deposits the receipts from the daily loads.


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VALUE LOAD SETTLEMENT/RECONCILATION
-----------------------------------

The following deals only with the data and cash flow for the remittance process,
with other detail in the load function addressed in other documents:

1. Verification and Authorization. Once a load transaction has been approved at
the POS device by the Data Center and the card load has been authorized, the
merchant will accept the cash from the consumer and place that cash into their
cash drawer.

2. Approval. Once the consumer accepts the accuracy of the receipt, the
transaction is finalized.


     (a) Issuing Processor. The POS device transmits the load detail to the Data
Center.


     (b) Remittance Processor. The POS device transmits the load detail to the
processor using Morgan Beaumont's proprietary process.

3. Approval. Either the issuing processor accepts the load data, and passes this
information to Morgan Beaumont. Morgan Beaumont uses proprietary process using
logic to route the transaction information to the correct processors based on
the POS device terminal ID.

4. Transfer. At the pre-determined time, the processor electronically moves the
funds defined in the daily POS activity reports from the Morgan Beaumont
Settlement Account to the processor settlement account so that the card accounts
can be charged with the value indicated. The processor uses the data sent by the
POS device to electronically move the funds from the merchant account to the
Morgan Beaumont settlement account.

STAGE IN DEVELOPMENT

During the year ended September 30, 2004, the Company was in the process of the
development and the deployment of the services required for customers to load
cards and access the basic customer questions such as card balance and recent
transactions using either a telephone or a computer connected to the Internet.
The Company focused its efforts on completing the merger with Pan American
Energy, accumulating POPs and negotiating for sales of its cards to
distributors. Since the year end, the Company believes that it has established
the necessary infrastructure and improved its technology to a level that
prepares it to be fully operational.

FINANCIAL TERMS OF PRODUCTS AND SERVICES

FEE ALLOCATION. Banks and processors charge the consumer fees for certain
transactions, which the Company passes through to the consumer. In some cases,
this is a direct pass through with no added margin. In other cases, the standard
fees charged to the consumer allow a small margin to be added prior to passing
along to the consumer. The risks associated with these certain transactions are
dependent of the type of program between the bank, the processors and the
Company. Some programs expose the Company to risk, but controls are placed on by
each to manage and minimize the risk to each party. The table below provides the
average fees paid by the consumer. Each bank and processor will set their own
fee structure.


                                       13


<PAGE>

       -----------------------------------------------------------------
       CARDHOLDER FEE SCHEDULE PAYROLL                FEE'S
       -----------------------------------------------------------------
       MONTHLY MAINTENANCE                            $4.95
       ATM DOMESTIC                                   $1.75
       ATM INTERNATIONAL                              $5.00
       ATM DECLINE/INQUIRY                            $1.00
       POS DOMESTIC                                   $0.75
       POS DOMESTIC DECLINE                           $0.75
       POS INTERNATIONAL                              $0.80
       POS INTERNATIONAL DECLINE                      $0.80
       BALANCE INQUIRY ONLINE                         FREE
       LIVE CALL WITH CSR                             $1/MINUTE
       LOST OR STOLEN CARD                            $20.00
       CARD LIQUIDATION                               $10.00

       RESEARCH REQUESTS                              UP TO $25/HR
       DORMANCY FEE                                   $7.50
       RETAIL LOAD                                    $4.95
       ACH CREDIT/DEBIT                               $1.25
       TRANSFER FROM                                  $1.00
       TRANSFER TO                                    $1.00

The above table is representative of a typical fee arrangement of the Company.
There is no standard arrangement; the fees vary from program and arrangements
the Company has with its processors.

ALLOCATION OF RISKS. The Company believes that the majority of risks associated
with its services are primarily born by the banks and the processors. For some
programs and arrangements of the Company, the risks are limited to the
associated bank. For other programs and arrangements, the Company may be exposed
to the risks associated with the card products as more fully described below. In
each program and arrangement, controls are placed at each level of the
transaction to minimize the risk to each individual party. Each program and
arrangement has a different method of managing risk to each individual party.

FRAUD. The Company has experienced virtually no fraud to date, however this
condition is likely to change as the Company's products are more widely used.
The Company intends to continue to take steps to minimize its risk to losses due
to fraud. On debit cards, it is a cash-on-cash transaction. The debit card
requires possession of the card and the actual personal identification number.
Unless the bank processor makes a mistake, there is very little known risk with
the debit cards at the time. In the event of a processor error, risk is on the
processor. On a hologram card, the risk of fraud is primarily on the Company
where the possibility of people purchasing the card products with intent to
defraud.

If a bank fails to pay or do proper paperwork with the processor, MasterCard or
Visa can shut down the bank and all cards issued by it, even if the cards have
credit balances loaded onto them.


                                       14


<PAGE>

MATERIAL RELATIONSHIPS

The process of getting the Company's products into the hands of consumers
involves contractual relationships at several levels: (1) the bank that issues
and owns the card, (2) the processor responsible for accepting transaction
information and keeping the card account up to date and (3) the Company's
distribution partners or customers are responsible for the distribution of the
cards to retail locations. The Company's current and intended operations involve
the Company working with some of the following business partners to sell cards
and services. Each of these relationships plays a different role.

     A)   Card Associations: MasterCard/ Visa. All of the cards the Company
          produces which have a hologram logo on the front will require approval
          from the card association holding the trade mark for the hologram
          logo. The Company obtains its access to the network of financial
          institutions and linked ATM's and point of sale systems through an
          arrangement among banks and MasterCard and Visa, as third party
          providers. The MasterCard and Visa relationship provides the Company
          with a package of other networks such as Star(TM) and Plus(TM) and
          Cirrus(TM) and similar networks. The Company's third party provider
          licenses with both MasterCard and Visa provides access to these
          networks without the Company having to negotiate access to each of the
          individual networks separately. The Company is in currently
          negotiating an agreement with Discover that will allow the Company to
          produce a Discover gift card. The Company pays an annual fee to the
          card association to maintain the program approvals.

     B)   Banks. The Bank is the entity with the direct relationship to the card
          association (MasterCard or Visa), and is responsible for sponsoring
          the Company as a TPP (Third Party Processor), or ISO (Independent
          Sales Organization). Without a TPP or ISO relationship with the card
          association, the Company would not be able to produce the card
          products for sale to consumers. Once an approval from a card
          association is obtained, the Company works with an issuing Bank to put
          out a card product or program. The terms of these contracts will
          articulate the Company's responsibility to supply adequate customer
          service to answer consumer questions and will define the card account
          parameters, i.e. the maximum amount the consumer can have on the card,
          and daily usage parameters for ATM withdrawals, etc. The bank has a
          schedule of fees for services provided to the card holder. The Company
          is charged these fees, and passes them on to the consumer each time a
          transaction that incurs a fee takes place. The bank charges the
          issuing processor a fee for certain transactions the consumer
          conducts, which is collected at the time of the transaction by the
          processor and distributed to the bank. The bank also charges the
          Company a monthly fee to keep the card account active. This fee is
          collected by the issuing processor who distributes those funds to the
          bank and to the Company. The Company currently has relationships with
          5 banks, First Gulf Bank, Bank First, MetaBank, First Federal Bank and
          Merrick Bank, but had only one bank relationship during the year ended
          September 30, 2004.


                                       15


<PAGE>

     C)   Processors. Banks require an approved processor have a relationship
          with the TPP or ISO so that all of the consumer transactions are
          tracked and debits/credits to the consumer card accounts are properly
          adjusted. The terms of these contracts articulate how the Company
          works with the processor to address fraudulent use of the cards, how
          any potential shortfall is addressed for a legitimate consumer load,
          and the availability of customer service information. The processor
          has necessary regulatory and banking approvals to conduct transactions
          from point of sale terminals and banks to apply credits and debits to
          the consumer cards. The Company has direct relationships with the
          processor to facilitate the consumer reconciliation of purchase and
          value loads to their card. WildCard Systems and National Card Services
          are examples of the Company's current relationships. The Company pays
          a fee to the processor for the initial set up of the card program and
          the processor charges a fee to the consumer for certain transactions
          performed by the consumer. These fees are collected by the processor
          and distributed to the appropriate party.

          Fraud risk is minimized in lower floor limits, (the ability of a store
          to process a transaction without a `real time' verification of the
          card balance), and the fact that these cards are intended to be used
          in the US. With the checks and velocity use parameters in place, the
          Company has not experienced significant fraudulent use of cards to
          date. The processor has a schedule of fees for services provided to
          the card holder. The Company is charged these fees, and passes them on
          to the consumer each time a transaction that incurs a fee takes place.

     D)   Distribution Partners. The relationship to the entities responsible
          for selling the card products to the retail store is a standard
          wholesale sales model. The Company sells the cards to the distributor
          at a wholesale price; the distributor then adds their margin and sells
          the card to the retail store. The retail store typically adds a margin
          and sells the card to the consumer. Each entity in this chain is free
          to establish their own margins; the Company simply offers suggestions
          regarding market trends. To place the Company's card products into the
          retail establishments that will sell them to the consumer, the Company
          works with a variety of distribution partners that are currently
          selling a similar or related product or service to the stores. The
          Company's current strategy is to use pre-paid phone card distributors
          and agents that wish to add additional products to their line. The
          financial arrangement between the Company and the distributor is a
          fairly typical wholesale situation. The distributor purchases the
          cards from the Company at a wholesale price and then sells the card
          products to the store with a margin added. There are some fees
          collected from the consumer, (the monthly maintenance is the most
          common) for which the Company will pay the distributor a commission.
          This is to encourage the distributor to continue providing service to
          the store so the consumer is satisfied with the features of the card
          product.

     E)   POPs. The Company currently has material relationships with certain
          firms and companies such as Secure Cash Network, Inc., IPrepay, Inc.,
          and Acosta, First Gulf Bank, WildCard, MetaBank, Merrick Bank, In
          Person Payment, Transaction Management, Bentley Commerce, MTel, whom
          offer its products to consumers and utilize its network system as well
          profit from the sale and use of the Company's products through their


                                       16


<PAGE>

          businesses. These key relationships expand the number of POPS which in
          turn is anticipated to increase revenue by increasing the coverage for
          use without having to increase costs for the production of products.

     F)   Affiliations Involved or Participating in the SIRE Network. The
          Company currently has an agreement in place with In Person Payment
          ("IPP") that allows IPP to load cards that can be loaded on the SIRE
          network. The Company also has an agreement with IPrepay which is in
          the process of implementing the ability to load cards that can be
          loaded on the SIRE network through many of its 160,000 locations. The
          Company is also currently negotiating with several other money
          transmitters to allow them to load SIRE network loadable cards.

     G)   Outsource/Design/ Packaging Services. The Company designs the majority
          of its products internally with the help of outside vendors
          experienced in the industry. These vendors also provide production and
          packaging services for the Company. By using both internal and
          external sources for this activity, the Company uses this redundancy
          to reduce dependence on individual sources for its product's design
          and manufacture.

LICENSING REQUIREMENTS. The Company has obtained a National Association of
Securities Dealer ("NASD") Federal Money Services Business License ("MSB"),
which some states require. Additionally, due to the nature of the business the
Company conducts, many states require the Company to obtain some type of money
services business license to sell or service the card products in that
particular state. There is currently no clearly defined policy at a Federal or
State level defining which segment of the business would require that type of
licensing and which states will participate in requiring the license. The
Company has engaged a law firm familiar with the current and emerging regulatory
climate to provide guidance in obtaining all necessary licenses. Due to the
changing regulatory situation, it is possible that a state the Company are doing
business in that does not currently require a license, may change its opinion,
laws, rules, regulations or interpretation thereof and later require that the
Company obtain a license. The Company has no ability to predict if that will
happen, or what the period of time to obtain a license may be if it should
occur. However, the Company has taken a proactive approach to this by regularly
contacting the State agency in charge of those matters, and requesting updates
on their policies. The Company anticipates this will provide adequate time to
obtain any license that may be required.

The Company initially believed that its present and intended operations were not
governed by specific state regulations and license requirements since the
Company was never handling money itself, only providing a card and an electronic
communications system for others to utilize. This was the Company's belief at
the time it first filed this 10-KSB. Thereafter, the Company engaged a law firm
in Nebraska which purported to be the national authority on debit card
regulation. That firm advised the Company that it would need to file
applications with State regulators in over 40 states. The Company learned this
just prior to filing its S-2 registration statement and therefore included three
risk factors related to this topic. Shortly thereafter, the Company began
getting inconsistent and contradictory advice from its outside counsel. When the
Company began inquiring about the inconsistencies, the law firm abruptly
resigned.


                                       17


<PAGE>

The Company then conducted a search for counsel experienced in state banking and
debit card regulations and ultimately chose and retained the national law firm
of Pillsbury, Winthrop et. Al. The initial advice from new counsel was
substantially different than that of the prior firm and the Company no longer
anticipates immediately seeking licenses in every state that regulate debit
cards. The Company recently hired the law firm of Jones Day to further assist in
the individual state license process. To date, the Company has not obtained any
state licenses.

ACQUISITIONS
------------


In December 2003, the Company acquired Typhoon (as defined above) for less than
$200,000 and merged it into the Company. The Company acquired Typhoon for its
IVR technology which the Company has incorporated into its business, as
described above in the Description of Products and Services section. The Company
also acquired the employment of Erik Jensen, formerly the President of Typhoon.
The Company issued stock as the purchase price for the acquisition of Typhoon.
Except for the merger between PAEY and Morgan Beaumont, the Company made no
other mergers or acquisitions in the fiscal year. Subsequent to the year end,
the Company acquired certain assets from MTel Communications to allow the
Company to establish its telecommunications business as described in the
comprehensive update. The Company also entered into negotiations to purchase a
competitor but elected not to proceed with the acquisition in 2005.


HISTORY OF BUSINESS OPERATIONS OF THE COMPANY
---------------------------------------------

Pan American Energy Corp. ("Pan American" or "PAEC") was incorporated under the
laws of Nevada on May 26, 2000 and planned principal operations of the Company
commenced in 2000. Pan American was an exploration stage company engaged in the
acquisition, exploration and development of mineral properties. Pan American's
business plan was to carry out exploration work on a mineral claim referred to
as the Flint mineral claim in order to ascertain whether it possessed
commercially developable quantities of gold, silver, lead or zinc.

Morgan Beaumont, Inc., a Florida corporation ("Morgan Beaumont"), was formed on
July 10, 2000, as a sales and marketing company providing debit card products to
the sub-prime consumer. Morgan Beaumont developed a strategy that launched a
successful sales campaign, and shipped the first cards to consumers in late
2001. Morgan Beaumont had a relationship with only one bank and one processor at
that time. The bank discontinued support of the debit card products in mid 2003
which prevented the Company from engaging in sales activities. This resulted in
a cessation of all card sales until December 2004. Morgan Beaumont began to
cultivate multiple Banking and processing relationships, as well as undertake
the development of value loading technology to bolster the Company's ability to
produce debit card products, and to attempt to provide the services for these
products the Company believed the consumer was requesting. Sales efforts for
debit card products resumed in late 2004, and sales began in 2005.

On May 10, 2004, Pan American entered into a merger agreement pursuant to the
Agreement with former Morgan Beaumont, which became effective with the State of
Nevada as of August 6, 2004 (the "Merger"), however, since Pan American had not
satisfied all of the conditions precedent under the Merger Agreement, the Merger


                                       18


<PAGE>

was not completed until August 2004. Morgan Beaumont merged with and into Pan
American, the separate existence of Morgan Beaumont ceased and Pan American
continued as the Surviving Corporation under the name Morgan Beaumont, Inc., a
Nevada corporation. The business of the Company changed from oil and gas
exploration development to the business of Morgan Beaumont, as described in this
Report.


The Company established MBI Services Group, LLC ("MBI Services Group") on
January 27, 2005. On May 6, 2005, the Company completed the purchase of property
and equipment from MTEL Communications, Inc., transferred the telecommunications
equipment to MBI Services Group, and began operations in Miami, Florida as a
telecommunications company. MBI Services Group is positioned to sell services to
multi-national carriers through Independent Sales Office ("ISO") providers in
specific targeted markets. By leveraging its relationships and increasing its
network of providers, MBI Services Group intends to introduce new profitable,
communications products on a regular basis.


INDUSTRY OVERVIEW
-----------------

The acceptance of credit and debit cards by consumers in the United States has
steadily increased over the past ten years. According to the Nilson Report, the
use of credit-based card systems in the United States grew from $0.5 trillion in
1992 to $1.9 trillion in 2002. In order to remain competitive, small and larger
businesses have embraced credit and debit cards as a necessity to their future
success. Consumer expenditures using card-based payment methods are expected to
grow to $4.6 trillion by 2012, or 50% of all U.S. payments, representing a
compound annual growth rate of 9% from 2002 levels, according to the Nilson
Report.

SUB-PRIME CREDIT CONSUMERS. According to CARDWEB.com, trade publications and the
United States payment Card Information Network, "there are perhaps as many as 60
million un-banked consumers in the United States. Analysts estimate this group
of un-banked consumers spends over $15 billion annually in check cashing and
other financial services." These individuals may be unable to avail themselves
of traditional credit and banking channels or to obtain a debit or credit card
for a number of reasons such as, recent immigration to the US, bad credit
history, lack of credit history due to divorce or age (i.e. students) or recent
emergence from bankruptcy etc. Prepaid debit and cash cards are attractive
alternatives to these individuals.

The difference between a sub prime consumer using debit cards and a prime
consumer using debit cards is that the prime consumers debit card is linked to
the individual's bank account at a bank where the consumer has a checking or
savings account. The sub prime consumers card is linked to a pool account
established as a depository for all funds linked to the BIN supplied by the
bank. Each consumer's card is a sub account in the larger pooled account.

Often times a sub prime consumer is not able to open a bank account for a
variety of reasons such as a low FICO score, or a history of bouncing checks, or
some similar activities banks shy away from. By obtaining a Morgan Beaumont
debit card the sub prime consumer is able to utilize Morgan's pooled account as
a depository with the issuing bank of the Morgan Beaumont card. This card
account becomes the sub prime consumers account where their money is stored, as
opposed to a prime consumer who simply opens an account at that bank in their
own name.


                                       19


<PAGE>

Both prime consumer and sub prime consumer accounts are a cash-on-cash
transaction, meaning both consumers must have money in their respective accounts
to use the debit card.

The MBI debit card is for a sub prime consumer and works the same as other debit
cards with the exception that MBI debit cards can have cash loaded on the card
at retail locations.

SERVICES OFFERED TO SMALL BUSINESS AND SUB-PRIME CREDIT CONSUMERS. Small
businesses and sub-prime credit consumers have traditionally been under-served
or ignored by traditional financial institutions. When services have been
available to this market segment, it has been made available at a premium price
given the perceived heightened risk potential for liability for fraud,
charge-backs and other losses. Debit cards substantially reduce that risk and
allow for more competitive terms to be offered to small businesses and sub-prime
credit consumers alike.

THE PREPAID CARD BUSINESS is a relatively young industry with increasing and
dramatic growth expected to continue well into the future. Total industry
revenues worldwide are predicted to reach $11 billion annually. Sales in the
U.S. prepaid phone card industry are expected to reach $6 billion this year, up
from just $80 million in 2003 (International Telecard Association). There are
several large providers of prepaid phone cards including AT&T, MCI, Qwest and
Sprint, as well as regional firms like Verizon, SBC and Bell South. However, the
bulk of the prepaid market belongs to smaller, independent sales firms that
concentrate in this marketplace and cater to the specific needs and desires of
prepaid consumers. It is these smaller, highly focused companies that are able
to meet the needs of the specific groups who most often utilize prepaid calling
services. This is also the same group that large providers are partnering with
to distribute their products effectively into these well-defined markets.

Prepaid phone card users, as a group, are comprised of a vast array of different
types of consumers. This $80 billion per annum industry contains certain subsets
of the general population, including trans-nationals new to the US, seasonal and
migratory workers and lower income populations create the bulk of what can be
termed the "credit challenged" segment of the prepaid market. These consumers
all have the need and desire to use telecommunications services, but for various
reasons are unable to use traditional credit based services. Another segment is
the youth market. Highly mobile, they are very strong consumers of
Communications services. A third segment includes business and recreational
travelers able to use prepaid calling services to save money when calling while
away from home. Other segments include individuals and organizations seeking to
develop a collectible card and groups involved in fund raising activities.

There are various reasons for consumers to use prepaid services. Often, these
reasons may center on the inability to establish sufficient credit relationships
with product and service providers. This group can further be divided into
markets based upon:

     o    limited income,
     o    lack of credit history due to youth, and
     o    limited residence time in the US.


                                       20


<PAGE>

Typically members within this group have few financial tools available to them,
with many not having any relationship with a bank or financial institution.
Collectively, these markets are often labeled the "sub prime" market.

An average long distance domestic call using a MBI Services Group prepaid phone
card may cost anywhere from 5 to 10 cents per minute. The same call made using a
MCI or AT&T calling card can cost as much as 8 to 10 cents more to over one
dollar per minute.

The Company offers branded cards specifically targeted to Mexican, South
American, Asian and Caribbean consumers. These demographic groups typically
exhibit a high degree of loyalty to companies that provide products and services
specifically designed for them.

Essentially, there are two types of business organizations that have evolved to
meet the needs of the prepaid marketplace. One was the technology-driven long
distance company (AT&T) that added a pre-paid transaction platform to their long
distance switch. The other was the distribution driven sales company that
private labeled their cards and resold the long distance company's services. MBI
Services Group is a hybrid of these two business models, encompassing aspects of
both types of organization.


BUSINESS STRATEGY
-----------------

The Company's goal is to become a market leader in the provision of card-based
products and services to small businesses and sub-prime credit customers by:

     o    EXPANDING IN EXISTING SMALL BUSINESS MERCHANT MARKET. The Company
          believes it can expand its business by focusing on the small merchant
          market. The Company intends to focus its efforts towards merchants who
          are considered small businesses and who belong to certain key ethnic
          groups and which have not historically accepted electronic payment
          methods. FOCUSING ON

     o    SUB-PRIME CREDIT CUSTOMERS LOCATED IN CERTAIN REGIONS. The Company
          intends to direct its advertising and sales efforts towards certain
          regions and ethnic groups it believes have been under-served by
          traditional financial institutions. The Company believes by focusing
          first on these groups it may be able to rapidly build a base of loyal
          customers.

The Company acknowledges that it faces substantial competition and operational
and developmental hurdles in the pursuit of this goal and that it may never
achieve profitability.

SALES AND MARKETING
-------------------

PERSONNEL


                                       21


<PAGE>

The Company had 4 sales and marketing personnel as of September 30, 2004. As of
August 31, 2005, the Company had 8 sales and marketing personnel. Of these
personnel, 4 people are currently focused on sales to distributors and 4 people
are focused on sales directly to retailers. Both groups' efforts center around
direct mail, telephone solicitation and industry direct advertising.

As of August 31, 2005, the Company had 14 sales people, of which 7 are outside
sales and 7 are in inside sales. The Company's outside sales people visit
customers and handles sales outside of the office. The Company's inside sales
personnel handle telemarketing and sales from within the Company's offices. The
Company also has 4 marketing personnel who prepare collateral materials, conduct
market research, handle advertising, do some web design and graphics design and
handle customer training.

TARGET MARKETS


The Company primarily markets its debit card products to distributors who
themselves market directly to their target markets. These are typically
consumers that for a variety of reasons do not have a traditional banking
relationship. The reasons are primarily, but not exclusively, due to low credit
scores. As discussed elsewhere, this can be due to bankruptcy, divorce, youth,
bad past credit practices, low income or other factors. The Company believes
these subprime consumers to be the majority of non banking debit card users;
however, the Company believes the use of debit cards is growing among all
consumers. The Company's cards are used in the same manner as traditional credit
and debit cards except they are a prepaid instrument and value can be loaded on
the cards at any SIRE network location.


To conduct the necessary transactions for bill payments, these consumers rely on
alternative financial products, such as money orders, to pay their bills. The
Company has established marketing tools and information it provides to the
various retail merchants that sell money orders and similar products to provide
information to consumers about the use of Money/Stored Value cards. The consumer
can then make an informed decision about the alternatives to using money orders
for some of their transactions. The demographic of the average debit card
customer is typically not defined by age or the geographic region they reside as
much as by individuals with a lower income and credit challenged.


During the period covered by this report and for the first part of calendar
2005, the Company primarily relied upon distributors to get its debit card
products into the retail locations. This requires the Company to identify
companies selling other products or services into the types of retail
establishments commonly used by its target consumer. iPrePay and Acosta are
examples of these companies. The Company's contract with iPrePay calls for the
roll out of 10,000 locations, and its contract with Acosta calls for the roll
out of 450 locations in the first wave of deployment. These locations may be
convenience stores, gas stations, grocery stores and may be individually owned
stores, or small to medium sized chains. These merchants are located in the 48
contiguous states, with a slightly higher concentration in the southern half of
the USA. The Company had sold approximately 90,000 cards from inception through
September 30, 2004 but had no card sales in fiscal year 2004. From January 1,
2005 to August 31, 2005, the Company had sold an additional 95,000 debit cards.


                                       22


<PAGE>

MBI Services Group initially focused on selling calling services that are
subcontracted from other facilities-based providers. Since the prepaid phone
cards are marketed as MBI Services Group's branded products, these providers are
transparent to MBI Services Group's customers and end-users. Since then MBI
Services Group has established its own switch sites and facilities while
developing proprietary network agreements with its carriers.


INTERNET WEB SITE. During the period covered by this report, the Company
expanded the content on its web site and attempted to develop an on-line
ordering and customer service system. While the Company intends to continue to
update its website and drive certain customers to the services offered on the
site, the Company has changed the focus of its website since the fiscal year
ended September 30, 2005. The website will be for interactive services for
existing cardholders and to provide information about the Company. Potential
customers can still download a card application but are no longer able to submit
an application for a card over the Internet. The Company has found that Internet
sales to the subprime market were unsuccessful. The Company may pursue Internet
sales more aggressively in the future.

CUSTOMER RELATIONS. The Company out-sources first contact customer service for
all members. The Company's content providers provide all back up and product
related customer service, interfacing with its support team. The Company
attempts to keep detailed records of every sales contact, including source of
inquiry, client needs, employment and income.

CUSTOMER RELATIONSHIP MANAGEMENT
--------------------------------

The Company's handling of all bilingual customer service is currently shared
between in-house and outsource customer service. Its customer service department
is scaleable to handle one or multiple programs. The Company also has
relationships with third party firms who wish to provide its customer service,
as needed.

COMPETITION
-----------

The markets for the financial products and services offered by the Company are
intensely competitive. The Company competes with a variety of companies in
various segments of the financial service industry and its competitors vary in
size, scope and breadth of products and services they offer. Certain segments of
the financial services industry tend to be highly fragmented, with numerous
companies competing for market share. Highly fragmented segments currently
include financial account processing, customer relationship management
solutions, electronic funds transfer and card solutions. The Company faces a
number of competitors in the debit card and payment market. It also faces
competition from in-house technology departments of existing and potential
clients who may develop their own product offerings.

The Company believes it competes with other providers of money and stored value
cards services on the basis of the following factors:

     o    quality of service;
     o    reliability of service;
     o    ability to evaluate, undertake and manage risk;
     o    speed in approving merchant applications; and
     o    price.


                                       23


<PAGE>

The Company believes its focus on smaller merchants and sub-prime credit clients
gives it a competitive advantage over larger competitors that have a broader
market perspective, and over competitors of a similar or smaller size that may
lack its extensive experience and resources in this market sector. Please see
Risk Factors for additional discussions of competition.

PROPRIETARY RIGHTS
------------------

The Company does not hold any patents and has not received any copyright or
trademark registrations to date. Where appropriate, to protect its intellectual
property rights, the Company intends to rely on a combination of trademark,
patent and copyright law, trade secret protection, confidentiality agreements
and other contractual arrangements with their employees, affiliates, clients,
strategic partners, acquisition targets and others. Effective trademark,
copyright and trade secret protection may not be available in every country in
which the combined company intends to offer its services. The steps taken to
date by the Company to protect its intellectual property rights may not be
adequate. The Company has not patented or trademarked any of its works through
the U.S. Patent and Trademark Office, nor has the Company copyrighted any of its
work through the U.S. Copyright Office. The Company has filed trademark
applications for the name Morgan Beaumont, its logo and for the "SIRE" network.
The trademark "SIRE" is already is already held by a large financial services
firm in the same trademark category that applies to the Company's business.
Third parties may infringe or misappropriate the Company's intellectual property
rights or the Company may not be able to detect unauthorized use and take
appropriate steps to enforce its rights. In addition, other parties may assert
infringement claims against the Company. Such claims, regardless of merit, could
result in the expenditure of significant financial and managerial resources.
Further, an increasing number of patents are being issued to third parties
regarding money and debit card processes. Future patents may limit the Company's
ability to use processes covered by such patents or expose the combined company
to claims of patent infringement or otherwise require the Company to seek to
obtain related licenses. Such licenses may not be available to the Company on
acceptable terms. The failure to obtain such licenses on acceptable terms could
have a negative effect on the Company's business.

Management of the Company believes that its products, trademarks and other
proprietary rights do not infringe on the proprietary rights of third parties
and that it has licensed proprietary rights from third parties.

The Company's proprietary intellectual property consists of:

     (1)  Interactive Voice Response software, to provide access to information
          in a database using a telephone and DTMF or voice for queries;
     (2)  Customer Relationship Management software, for use in customer service
          applications that require tightly integrated and customizable
          interaction;
     (3)  Software for various Point of Sale terminals, with functionality to
          facilitate non-cash transactions for barter exchanges using either IVR
          or magnetic card transactions; and


                                       24


<PAGE>

     (4)  Application server and web server software, to provide the business
          logic necessary for proper data transmission of all transactions that
          may be initiated for any other applications listed above. This
          software is a very complex set of technologies with many distinct
          components, but requires the use of all parts.

The Company believes that most of its proprietary software is protected by
common law copyright, but none have been registered with the United States
Copyright Office.

EMPLOYEES
---------

As of September 30, 2004, the Company had 14 full time employees: 4 Executives,
3 Administrative, 3 Sales and 4 Technical Personnel. As of August 31, 2005, the
Company had 44 full time employees that the Company now categorizes as: 4
officers and executives; 14 sales; 4 marketing; 6 technology; 7 customer
service; 4 operations and 4 finance. The Company also has 5 full time
consultants that presently operate the Company's telecom division. None of its
current employees are covered by any collective bargaining agreement and it has
never experienced a work stoppage. The Company considers its employee relations
to be good. The Company believes its future success will depend in large part on
its continuing ability to attract, train and retain highly skilled technical,
sales, marketing and customer support personnel.

INVESTMENT RISKS
----------------

An investment in the Company's stock involves a high degree of risk. Investors
considering investing in the Company should carefully consider the risks
described below and other risks inherent in doing business before investing in
its common stock. If any of the following risks or other risks occur, the
Company's business, operating results and financial condition could be seriously
harmed. The trading price of its common stock could decline due to any of these
or other risks.

MOST STATES REQUIRE THE COMPANY TO UNDERGO A DIFFICULT AND COSTLY PROCESS OF
OBTAINING LICENSES TO LOAD THE COMPANY'S STORED VALUE CARDS. Approximately 40
states have established laws or regulations requiring entities taking or loading
money on cards or processing such transactions, to be licensed by the state
unless that entity has a federal banking charter and is operating from a
licensed bank branch. The Company has engaged counsel to contact the authorities
of each state in which it conducts business to determine its compliance needs.
In the interim, the Company intends to continue to rely upon the licenses of its
affiliated banks. Some states may require the Company to obtain its own license
to conduct money loading operations. This may mean that in order for the Company
to be able to conduct its card loading operations, it will be required to apply
for and obtain licenses in nearly every state in which the Company loads money
on to cards. This process will include the Company retaining special attorneys
to assist it in the application process. The Company will have to file an
extensive license application in each such state. The Company will have to post
bonds to operate in those states and pay filing fee's which range from $1,000 to
$100,000 per state. The Company will also have to qualify to do business in each
such state and thereafter file tax returns and be subject to service of process
in each state. In the best case scenario it will take at least 9 months to


                                       25


<PAGE>

obtain all of the necessary licenses. The Company does not presently know if it
will be able to obtain all of the Licenses the Company needs to fulfill existing
and proposed contracts. The Company also does not know if it will be able to
obtain the funding necessary to purchase the approximately $6,000,000 in bonds
necessary to secure all of the licenses. In most states the Company will have to
obtain the bonds prior to applying for the license.

CAPITAL RESOURCES OF THE COMPANY HAVE NOT BEEN GENERATED FROM OPERATIONS, THE
COMPANY MAY BE DEPENDENT ON ITS ABILTIY TO SELL ADDITIONAL STOCK TO FUND
CONTINUED OPERATIONS.

From inception to June 30, 2005, the Company generated cash from financing
activities of $7,828,389. This amount arose primarily from sales of the
Company's common stock, and collections under a note receivable from a
stockholder that was acquired at the time of the Pan American merger discussed
above. The Company has used a significant portion of this capital to fund cash
outflows for operating and investing activities of approximately $3,949,860 and
$815,787, respectively as of June 30, 2005. Since the Company has not attained
profitable operations and is dependent upon obtaining financing to pursue its
plan of operations, there is no assurance that it will not require additional
resources in the future or that it will be able to obtain financing in the
amount required or terms satisfactory to the Company.

THE COMPANY'S POINT OF PURCHASE OPERATORS MAY SUBJECT US TO LIABILITY IF THEY
FAIL TO FOLLOW APPLICABLE LAWS.

As part of the Company's license requirements, it may be required to have agency
agreements with each of its load centers. Among other things the agreements will
require them to comply with the Patriot Act and anti-money laundering laws.
While the Company does not intend to be responsible for their actions, the
Company could be subject to state or federal actions against it if its load
center agents violate or are accused of violating the law. Such actions could
compromise the Company's credibility with its customers, issuing banks and state
regulators, generally making it harder for the Company to do business. It could
also cost the Company a great deal of money to investigate, defend and resolve
such matters. The Company cannot be sure that it could afford such actions and
be able to continue in business.


OTHER STATES MAY ADOPT EVEN MORE STRINGENT LICENSING RULES AND REGULATIONS. The
Company anticipates that many of those states will later adopt regulations or
laws with which it will be required to comply. There were over one hundred
stored value bills introduced in state legislatures in the first half of 2004
alone. The Company expects regulation of this industry to only increase and
become more complicated. Regulatory and tax intensive states such as California
will likely adopt a typically complex and heavily regulated scheme. The lack of
license requirements in states such as California is more likely a result of
their legislature's inability to function effectively rather than the lack of
desire to tax and regulate. It may be even more costly or difficult for the
Company to comply with the new state regimes and more stringent rules and
regulations adopted by state and federal government agencies. These regulatory
structures could prove too expensive or complicated for the Company to comply
with on a cost effective basis or at all.


                                       26


<PAGE>

THE COMPANY'S STOCK IS MORE DIFFICULT TO TRADE SINCE IT IS CLASSIFIED AS A PENNY
STOCK. The SEC has adopted rules that regulate broker-dealer practices in
connection with transactions in penny stocks. Penny stocks are generally equity
securities with a price of less than $5.00, other than securities registered on
certain national securities exchanges or quoted on the NASDAQ system, provided
that current price and volume information with respect to transactions in such
securities is provided by the exchange or system. The penny stock rules require
a broker-dealer, prior to a transaction in a penny stock, to deliver a
standardized risk disclosure document prepared by the Commission, that:

     (a) contains a description of the nature and level of risk in the market
for penny stocks in both public offerings and secondary trading;

     (b) contains a description of the broker's or dealer's duties to the
customer and of the rights and remedies available to the customer with respect
to a violation to such duties or other requirements of Securities' laws;

     (c) contains a brief, clear, narrative description of a dealer market,
including bid and ask prices for penny stocks and the significance of the spread
between the bid and ask price;

     (d) contains a toll-free telephone number for inquiries on disciplinary
actions;

     (e) defines significant terms in the disclosure document or in the conduct
of trading in penny stocks; and

     (f) contains such other information and is in such form, including
language, type, size and format, as the Commission shall require by rule or
regulation.

The broker-dealer also must provide, prior to effecting any transaction in a
penny stock, the customer with:

     (a) bid and offer quotations for the penny stock;

     (b) the compensation of the broker-dealer and its salesperson in the
transaction;

     (c) the number of shares to which such bid and ask prices apply, or other
comparable information relating to the depth and liquidity of the market for
such stock; and

     (d) a monthly account statements showing the market value of each penny
stock held in the customer's account. In addition, the penny stock rules require
that prior to a transaction in a penny stock not otherwise exempt from those
rules; the broker-dealer must make a special written determination that the
penny stock is a suitable investment for the purchaser and receive the
purchaser's written acknowledgment of the receipt of a risk disclosure
statement, a written agreement to transactions involving penny stocks, and a
signed and dated copy of a written suitability statement. These disclosure
requirements may have the effect of reducing the trading activity in the
secondary market for the Company's stock.


                                       27


<PAGE>

RISKS RELATED TO THE BUSINESS OF THE COMPANY
--------------------------------------------

The following is a summary of some of the risk factors which may have an impact
on the Company's business efforts:

THE COMPANY HAS A LIMITED OPERATING HISTORY IN A NEW AND RAPIDLY CHANGING
INDUSTRY. The Company was formed in May of 2000. Accordingly, the Company has
only a limited operating history on which an evaluation of its prospects can be
made. Such prospects must be considered in light of the substantial risks,
expenses and difficulties encountered by new entrants into the sub-prime credit
industry. Significant on-going risks include the Company's ability to:

     o    expand its subscriber base and increase subscriber revenues;
     o    compete favorably in a highly competitive market;
     o    access sufficient capital to support its growth;
     o    recruit, train and retain qualified employees;
     o    introduce new products and services; and
     o    upgrade network systems and infrastructures.

The Company cannot be certain that it will successfully address any of these
risks. In addition, its business is subject to general economic conditions,
which may not be favorable for the Company's business in the future.

THE COMPANY HAS NOT BEEN PROFITABLE AND EXPECTS FUTURE LOSSES. The Company has
suffered recurring losses from operations including a net loss of $1,031,335 for
the nine months ended September 30, 2004 and $3,072,514 for the nine months
ended June 30, 2005. Operating expenses for the nine months ended September 30,
2004 and the nine months ended June 30, 2005 were $1,118,671 and $3,745,163,
respectively. The Company has not achieved profitability in any quarterly or
annual period since inception and it expects to continue to incur net losses for
the foreseeable future. Although revenues have grown in certain recent quarters,
the Company cannot be certain that it will be able to sustain these growth rates
or that it will obtain sufficient revenues to achieve profitability. Even if the
Company does achieve profitability, it cannot be certain that it can sustain or
increase profitability on a quarterly or annual basis in the future. The Company
expects that costs and expenses will continue to increase in future periods,
which could negatively affect future operating results.


THE COMPANY COULD BE REQUIRED TO CUT BACK OR STOP ITS OPERATIONS IF IT LATER
NEEDS MONEY BUT IS UNABLE TO OBTAIN NEEDED FUNDING. The Company will need to
raise additional capital to expand its business, repay indebtedness incurred in
connection with upgrading its facilities and meet pre-existing cash obligations
through the 2005 fiscal year. Should the Company be unsuccessful in its efforts
to raise capital, it will be required to curtail its expansion plans or it may
be required to cut back or stop operations. There can be no assurance that the
Company will raise additional capital or generate funds from operations
sufficient to meet its obligations and planned requirements. As with its
November 2004 private sale of securities, the Company might have to sell shares
at a time when its stock price is unusually low. In such an event, the Company's
shareholders could experience substantial dilution. The purchases in the
Company's recent offering also have anti-dilution protection.


                                       28


<PAGE>

THE LOSS OF KEY PERSONNEL COULD WEAKEN THE COMPANY'S TECHNICAL AND OPERATIONAL
EXPERTISE, DELAY ENTRY INTO NEW MARKETS AND LOWER THE QUALITY OF ITS SERVICE.
The Company's success depends on the continued efforts of its senior management
team and its technical, marketing and sales personnel. The Company also believes
that to be successful, it must hire and retain highly qualified personnel.
Competition in the recruitment of highly qualified personnel in the sub-prime
credit industry is intense. Hiring employees with the skills and attributes
required to carry out its strategy can be time consuming. The Company may not be
able to retain or successfully integrate existing personnel or identify and hire
additional qualified personnel. If the Company loses the services of key
personnel or is unable to attract additional qualified personnel, its business
could be materially and adversely affected. The Company does not have key-man
life insurance.

SECURITY AND PRIVACY BREACHES OF THE COMPANY'S ELECTRONIC TRANSACTIONS MAY
DAMAGE CUSTOMER RELATIONS AND INHIBIT THE COMPANY'S GROWTH. Any failures in the
Company's security and privacy measures could have a material adverse effect on
its business, financial condition and results of operations. The Company
electronically transfers large sums of money and stores personal information
about consumers, including bank account and credit card information, social
security numbers and merchant account numbers. If the Company is unable to
protect or consumers perceive that it is unable to protect, the security and
privacy of its electronic transactions, the Company's growth and the growth of
the electronic commerce market in general could be materially adversely
affected. A security or privacy breach may:

     o    cause the Company's customers to lose confidence in its services;
     o    deter consumers from using its services;
     o    harm the Company's reputation;
     o    expose the Company to liability;
     o    increase the Company's expenses from potential remediation costs; and
     o    decrease market acceptance of electronic commerce transactions.

While management of the Company believes that it has utilized proven
applications designed for premium data security and integrity to process
electronic transactions, there can be no assurance that the Company's use of
these applications will be sufficient to address changing market conditions or
the security and privacy concerns of existing and potential subscribers.

THE MARKET FOR ELECTRONIC COMMERCE SERVICES IS EVOLVING AND MAY NOT CONTINUE TO
DEVELOP OR GROW RAPIDLY ENOUGH FOR THE COMPANY TO REMAIN CONSISTENTLY
PROFITABLE. If the number of electronic commerce transactions does not continue
to grow or if consumers or businesses do not continue as projected to adopt the
Company's products and services, it could have a material adverse effect on the
Company's business, financial condition and results of operations. Management
believes future growth in the electronic commerce market will be driven by the
cost, ease-of-use and quality of products and services offered to consumers and
businesses. In order to consistently increase and maintain the Company's
profitability, consumers and businesses must continue to adopt its products and
services.


                                       29


<PAGE>

THE DEBIT CARD INDUSTRY IS A FAIRLY NEW INDUSTRY THAT IS DEVELOPING AND BUILDING
OUT STANDARDS, PROCESSES AND RELATIONSHIPS. The Company is a developmental
company building out networks and relationships. In the course of this build out
of the network, relationships, POPs and related systems, there exist the
possibility that the associated companies may delay payment to the Company, or
return the Company's products to it because their customer base is in the
process of being educated as to benefits and how to use debit cards. These
delays and or returns could have an adverse effect on cash flow, sales and
inventory levels.

IF THE COMPANY DOES NOT RESPOND TO RAPID TECHNOLOGICAL CHANGE OR CHANGES IN THE
INDUSTRY STANDARDS, ITS PRODUCTS AND SERVICES COULD BECOME OBSOLETE AND IT COULD
LOSE ITS EXISTING AND FUTURE CUSTOMERS. If competitors introduce new products
and services embodying new technologies, or if new industry standards and
practices emerge, the Company's existing product and service offerings,
proprietary technology and systems may become obsolete. Further, if the Company
fails to adopt or develop new technologies or to adapt its products and services
to emerging industry standards, it may lose current and future customers, which
could have a material adverse effect on the Company's business, financial
condition and results of operations. The electronic commerce industry is
changing rapidly. To remain competitive, the Company must continue to enhance
and improve the functionality and features of its products, services and
technologies.

CHANGES IN BANKING REGULATIONS COULD HURT THE COMPANY'S ABILITY TO CARRY OUT ITS
BUSINESS PLAN. The Company has designed its systems and card programs to comply
and work in association with applicable banking rules and regulations. A change
of those rules and regulations could require the Company to dramatically alter
its software programs, the hardware upon which it operates and its
implementation and operation of debit cards and stored value cards. Such changes
could be costly or impractical and the Company may not be able to modify its
operations and technology to comply with dramatic changes in banking
regulations.

CHANGES IN THE PATRIOT ACT COULD IMPEDE THE COMPANY'S ABILITY TO CIRCULATE CARDS
THAT CAN BE EASILY LOADED OR ISSUED. The Company's current screening process is
designed to comply with the Patriot Act requirements that financial institutions
know their cardholders. If the Patriot Act or subsequent legislation increases
the level of scrutiny that the Company or its affiliated banks are required to
adopt to know their customers, it may be costly or impractical for the Company
to continue to profitably issue and load cards for its customers or even comply
with new regulation schemes.

IF MAJOR BANKS BEGIN TO TARGET THE SUB-PRIME MARKET, IT WILL CREATE SUBSTANTIAL
COMPETITION FOR THE COMPANY AND ITS PRODUCTS AND SERVICES. The Company operates
among major financial institutions, providing products and services designed to
service the sub-prime credit market. Large and small banks alike have
traditionally not sought the typically unprofitable and undesirable sub-prime


                                       30


<PAGE>

market. This allows the symbiotic relationship between banks and the Company,
where the banks get access to the cumulative deposits of the cardholders,
without the trouble of administering thousands of very small individual accounts
of less reliable depositors. If banks decide to directly target the sub-prime
market before the Company is able to establish a strong foothold, the Company
will not be able to compete with established banks which have substantially
greater resources.

CREDIT CARD FRAUD OR COMPUTER HACKING COULD SUBSTANTIALLY HARM THE COMPANY AND
ITS OPERATORS. As with any technology company, the Company is always at risk of
computer fraud, hacking or other electronic crime. While the Company believes
that it has substantial systems in place to recognize and prevent computer fraud
and hacking, the relentlessness of hackers means no system is absolutely secure.
Due to the limited financial resources of the Company, any substantial computer
crime and particularly an electronic embezzlement would adversely affect the
Company's ability to continue as a going concern.

INTERNAL PROCESSING ERRORS COULD RESULT IN THE COMPANY FAILING TO APPROPRIATELY
DEDUCT TRANSACTIONS FROM CUSTOMER ACCOUNTS. In the event of a system failure by
the Company that went undetected for a substantial period of time, the Company
could allow transactions on blocked accounts, false authorizations, fail to
deduct charges from accounts or fail to detect systematic fraud or abuse. Errors
or failures of this nature could immediately adversely impact the Company, its
credibility and its financial standing.

A CHANGE IN LICENSING LAWS COULD IMPAIR THE COMPANY'S ABILITY TO MOVE MONEY OVER
A BANKING NETWORK. The Company is dependent upon the use of electronic banking
networks owned by major financial services institutions and major banks to load
value on the cards and record deductions against cardholders' accounts. If the
Company loses access to such networks by virtue of contact issues or changes in
the laws or regulations governing their use, it could render the Company's
products useless.

THE REQUIREMENTS TO MAINTAIN HIGHER RESERVE ACCOUNTS COULD IMPAIR THE COMPANY'S
GROWTH AND PROFITABILITY. The Company is required to maintain reserve deposit
accounts with the financial institutions serving the cardholders. If the Company
is required to deposit higher than normal reserves with the financial
institutions it works with, it could have a material impact on the Company's
cash available for operations and impede the Company's expansion of business.

IF THE COMPANY WERE TO LOSE ITS THIRD PARTY PROCESSOR LICENSE FROM MASTERCARD OR
VISA, THE LOSS WOULD SUBSTANTIALLY INTERFERE WITH THE COMPANY'S ABILITY TO
TRANSACT BUSINESS. The Company obtains its access to the network of financial
institutions and linked ATM's and point of sale systems through an arrangement
among banks and MasterCard and Visa, as a third party provider. MasterCard and
Visa relationship allow the Company to come with a package of other networks
such as Star(TM) and Plus(TM) and Interlink(TM) and Cirrus(TM) and similar
networks. If the Company loses its third party provider licenses with both


                                       31


<PAGE>

MasterCard and Visa, it would be forced to separately negotiate access to each
of the individual networks. Any down time associated with the loss of access in
the networks could render the Company's systems and cards as issued useless.
Even if the Company was then able to negotiate third party processor agreements
with the individual networks, it might not be able to do so in time to preserve
its business name and customer relationships. Thus, the loss of third party
processor relationships with both Visa and MasterCard could put the Company out
of business.

IF MASTERCARD OR VISA CHANGES THEIR REQUIREMENTS OR STOPS ISSUING DEBIT CARDS,
THE LOSS WOULD SUBSTANTIALLY INTERFERE WITH THE COMPANY'S MARKETING STRATEGY AND
REQUIRE THE COMPANY TO ISSUE ONLY NON-HOLOGRHAM PRODUCTS.

Customers readily accept the Visa and MasterCard brands on debit cards. If the
Company would lose its ability to issue cards under the Visa and MasterCard
brands, the Company would lSse substantial market acceptance for its products.

SECURITY AND PRIVACY BREACHES IN THE COMPANY'S ELECTRONIC TRANSACTIONS COULD
DAMAGE CUSTOMER RELATIONS AND INHIBIT ACCEPTANCE BY THE MARKET OF THE COMPANY'S
PRODUCTS. Any failures in the Company's security and privacy measures could have
a material adverse affect on the Company's business, financial condition and
results of operations. The Company is built upon electronic storage and transfer
of money in transactions handled by both the Company and associated financial
institutions. The Company also retains a great deal of information about its
customers including bank account, other credit card information, social security
information, where applicable, as well as merchant account numbers and similar
information. If the Company or the financial institutions with which it does
business are not able to protect the security and privacy of this information or
if they are merely perceived to be unable to protect such information it could
cause customers to lose confidence in the Company's services and deter customers
from using the Company's services. It could also expose the Company's liability
or increase the Company's expenses to police such problems and rehabilitate
public perception of the Company after a mistake occurs. While the Company
believes it utilizes proven applications designed for data security and
integrity, there can be no assurance that the use of these applications by both
the Company and its financial institution contractors will be sufficient to
address changing market conditions or security and privacy concerns of existing
and potential customers.

CERTAIN DELAYS COULD CAUSE LOSS OF BUSINESS OPPORTUNITIES AND INHIBIT THE
COMPANY'S GROWTH

Delays in the development of the Company's programs or business plans could
cause loss of opportunities. These delays could be in areas such as:

     o    Deployment of the company's technology
     o    Obtaining POPs
     o    POPs becoming active


                                       32


<PAGE>

     o    Interfacing with technology at the POPs
     o    Adoption of technology
     o    Revenue due to cards being activated
     o    Revenue due to cards being used
     o    Revenue due to training at distribution level
     o    Revenue due to training at POPs level
     o    Revenue due to bank processer approvals for card programs

The delays could cause occurrences such as delays in launching card programs
which could cause the Company to burn more cash, increase the Company's need for
outsourcing or costs of licensing technology, render the cards unusable causing
the Company to refund customers' money and cause the card products to be
returned to distribution. The delays may also impact the Company's cash flow and
profitability and cause the Company to lose its bank sponsorship which may lead
to the Company losing its ability to load cash onto cards and reduce the
features of the cards. Delays due to interfacing with technology at the POPs,
delays in distribution down line deployment of inventory into POPs, delays in
revenue due to cards being used or delays in revenue due to training at the POPs
level could cause extended terms to be granted to distribution. Delays in
distribution down line deployment of inventory into POPs could also delay the
sale, activation and use of the cards as could delays due to adoption of
technology, delays in revenue due to training at the distribution level or
delays in revenue due to training at the POPs level. Delays in revenue due to
bank approvals of programs or changes in card programs could cause cards to
become unusable and result in litigation.

PROVIDING CREDIT TO THE WRONG DISTRIBUTORS COULD HARM THE COMPANY'S TELECOM
BUSINESS AND INHIBIT ITS GROWTH

If the Company provides credit to the wrong distributors it could have a
material adverse effect on its telecom business, financial condition and results
of operations. The Company electronically transfers credit in advance onto its
prepaid phone cards which it sells to its distributors. If the distributor does
not pay us as agreed, it could harm the Company's telecom business. In addition,
if the Company is unable to protect or consumers perceive it is unable to
protect, the security and privacy of the Company's electronic transactions, its
growth in the telecom market could be materially adversely affected. Providing
credit to the wrong distributors may:

     o    cause the Company embarrassing and damaging disclosure obligations;
     o    cause the Company's customers to lose confidence in its services;
     o    deter consumers from using the Company's services;
     o    harm the Company's reputation;
     o    expose the Company to risk of fraud;
     o    expose the Company to liability; and
     o    increase the Company's expenses from potential remediation costs.

HAVING INSUFFICIENT BANDWIDTH, PROBLEMS ON THE COMPANY'S TELECOM EQUIPMENT OR
CARRIERS BEING DOWN COULD IMPAIR THE COMPANY'S ABILITY TO EFFECTIVELY HOST ITS
TELECOM NETWORKS


                                       33


<PAGE>

The Company requires sufficient bandwidth as well as operating equipment and
carriers to host its telecom networks. Insufficient bandwidths, problems with
the Company's telecom equipment or carriers could impair its ability to
effectively host its telecom networks which could have a material adverse effect
on the Company's business, financial condition and results of operations.

DESCRIPTION OF PROPERTY

FACILITIES
----------

The Company's corporate headquarters is located in a 3,200 square foot facility
at 2280 Trailmate Drive, Suite 101, Sarasota, Florida 34243, telephone number:
941-753-2875. This facility is leased, with a base monthly rent of $2,813. This
lease expires on November 2006. The Company anticipates that its current
facilities may soon be inadequate for its operations and it may need to seek
additional space as it expands its operations and employee base.


The Company has established a branch office located in a 1,200 square foot
facility at 41892 Enterprise Circle South, Temecula, California 92590. This
facility is leased with a base monthly rent of $1050.00. The lease expired on
June 30, 2005 and the Company vacated that facility.


The Company currently maintains its database, software and operations at 1
Wilshire Blvd in Los Angeles, California 90017, as a "mirrored" location for
security and redundancy in the case of an emergency or power outage.

LEGAL PROCEEDINGS

The Company is involved in certain litigation in the normal course of business.
The Company does not believe the resolution of these matters will have a
material adverse effect on its financial position or results of operations.
Listed below is a list of litigation active on September 30, 2004:

MORGAN BEAUMONT, INC. V. ROBERT W. CLOUD, CASE NO. 2004-CA-4392 (SARASOTA
-------------------------------------------------------------------------
COUNTY, FLORIDA):
-----------------

Wade Cloud was a former short-term employee of the Company, hired to be a sales
person. He was terminated for cause by the Company after only a few months. In
an attempt to settle this dispute without litigation, the Company offered to pay
all compensation due to Mr. Cloud under his employment agreement through the
date he was terminated and the offer was refused. The compensation offered to
Mr. Cloud has been placed in escrow with the Company's attorney in the case and
is not included on its balance sheet.

The Company filed suit against Mr. Cloud in May 2004 in order to invalidate his
employment contract. Subsequently, as a counter to the lawsuit, Mr. Cloud has
alleged that he has ownership rights to software developed by Typhoon Voice
Technology for Morgan Beaumont. The two cases were consolidated under the case
name, Robert W. Cloud v. Morgan Beaumont, Inc., Case No. 2004-CA-4392. The
Company additionally filed suit in September 2004 in Federal Court in Sarasota


                                       34


<PAGE>

County, Florida against Mr. Cloud, Cloud Consulting, which as of November 2004
has gone unanswered. Mr. Cloud has since through his attorney requested
arbitration in Tampa, Florida for resolution in December of 2004. The Company's
attorneys have submitted a written opinion that Mr. Cloud's counter suit is not
material. Management believes they have a strong likelihood of success in this
matter.

MORGAN BEAUMONT, INC. V. FIRST NATIONAL BANK OF CENTRAL TEXAS, FISCRIP,
-----------------------------------------------------------------------
TRANSEND, SUPERIOR BANK, FINANCIAL SERVICES INTERNATIONAL, VIRTUAL MONEY,
-------------------------------------------------------------------------
OPTIMUM PAY, CASE NO. 8:03-CV-2499-T-17MAP (MIDDLE DISTRICT OF FLORIDA):
------------------------------------------------------------------------

Suit was filed by the Company in Federal Court in Tampa, Florida in April 2004,
against the defendants named above, maintaining that the banks and processors
named failed to submit paperwork to MasterCard on Morgan Beaumont card programs
while approving the programs and advising the Company that MasterCard authorized
the shipment of Morgan Beaumont cards to its customers. The card program was
canceled by MasterCard due to the banks' failure to properly submit the
appropriate applications. The Company is seeking recovery of costs as well as
damages in excess of $75,000. No trial date has been set.

In November 2004, the Company had reached a settlement in the referenced lawsuit
with two defendants, FSI and TranSend, pursuant to which FSI and TranSend will
pay the Company $10,000, forgive approximately $50,000 in notes and debt, grant
the Company a royalty free license to use its software and provide the Company
with 10,000 cards free of charge. FSI has also agreed to use the Company's
software to load cards. The Company's action against First National Bank of
Central Texas, the primary defendant, is not settled and remains pending.

SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

On May 10, 2004, a majority of the security holders of the Company voted
affirmatively for the following:

     1.   To approve a .66956 for one reverse split of the issued and
          outstanding shares of common stock;

     2.   To approve the amendment of the Articles of Incorporation to:

          a.   change the name of Pan American from "Pan American Energy Corp."
               to "Morgan Beaumont, Inc."; and

          b.   Restore the authorized share capital of Pan American after the
               reverse split back to:

               i    170,000,000 shares of common stock with a par value of 0.001
                    per share; and

               ii.  25,000,000 shares of preferred stock with a par value of
                    $0.001 per share.

     3.   To approve the change of business of Pan American to oil and gas
          exploration and development to the business of Morgan Beaumont;

     4.   To elect five persons to Pan American's Board of Directors to serve
          until the next annual general meeting of stockholders and until their
          respective successors are elected or appointed.


                                       35


<PAGE>

APPROVAL OF REVERSE SPLIT. The primary purpose of the .66956 for one reverse
split was to decrease the number of total shares issued and outstanding of Pan
American's common stock. Pan American affected a five for one forward split of
its stock on March 22, 2004. At the time, management of Pan American believed
this forward split was in the best interest of Pan American and its
stockholders. Management on negotiation with the principals of Morgan Beaumont,
agreed to reduce the issued and outstanding share capital of Pan American to
what the parties believed was a more realistic level.

The principal effect of the reverse stock split was that the number of shares of
common stock issued and outstanding was reduced from 60,325,000 shares as of
June 25, 2004 to approximately 40,391,207 shares, which include the shares
issued as part of the August 24, 2004 Merger. The actual number of shares
outstanding depended on the number of fractional shares which have either been
cancelled or rolled up to the next whole share.

Approval of the reverse split required the affirmative consent of- at least a
majority of the outstanding shares of common stock of Pan American. Majority
Stockholders, holding a total of 34,000,000 shares of common stock (56.36%), had
agreed to this action.

APPROVAL OF THE CHANGE OF BUSINESS DIRECTION. The change of business of Pan
American from oil and gas exploration and development to the business of Morgan
Beaumont would move Pan American into a new business direction. Ratification and
approval of the new business direction of Pan American required the affirmative
consent of at least a majority of the outstanding shares of common stock of Pan
American. Majority Stockholders, holding a total of 34,000,000 shares of common
stock (56.36%), had agreed to this action.

APPROVAL OF THE NAME CHANGE. The proposed change of Pan American's name to
"Morgan Beaumont, Inc." was intended to convey more clearly a sense of Pan
American's business as to the business of Morgan Beaumont. Approval of the name
change required the affirmative consent of at least a majority of the
outstanding shares of common stock of Pan American. Majority Stockholders
holding a total of 34,000,000 shares of common stock (56.36%), agreed to this
action.

ELECTION OF NEW DIRECTORS. The election of new directors was proposed because
the Change of Business Direction would effect a change of control of Pan
American and the new business direction would have required a board of directors
familiar with Morgan Beaumont's business. The Merger Agreement between Pan
American and Morgan Beaumont required that new directors be appointed. Approval
of the appointment of the new slate of directors required the affirmative
consent of at least a majority of the outstanding shares of common stock of Pan
American. Majority Stockholders holding a total of 34,000,000 shares of common
stock (56.36%), agreed to this action.


                                       36


<PAGE>

The previous officers of Pan American resigned their positions with Pan American
at the closing of the Merger and five new directors were elected by the
stockholders pursuant to the Information Statement filed on a Schedule 14D with
the Securities Exchange Commission on July 6, 2004. The previous directors and
officers of Pan American were as follows:

Name                     Age      Position                         Since
----                     ---      --------                         -----

Scott C. Houghton        35       President and                    2000
                                  Director

Korina Houghton          35       Secretary/Treasurer and          2002
                                  Director

Arnold Howardson         58       Senior Vice-President            2002

The following nominees of Morgan Beaumont were elected as the executive officers
and directors of Pan American at the closing of the Merger:

NAME                         AGE               EXPECTED POSITION
----                         ---               -----------------

Erik Jensen                  46                COO and Director
Kenneth Craig                50                CFO, Secretary and Director
Cliff Wildes                 54                CEO and Director
Rod Braido                   59                Director
Mark Brewer                  46                Director

Detailed background information on the new officers and directors is discussed
in on Page 45.


                                     PART II

MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDERS MATTERS

MARKET INFORMATION

The Company's shares are currently trading on the OTC Bulletin Board under the
stock symbol MBEU. Formerly the Company's shares traded under the symbol AGBM
from May 16, 2002 through March 22, 2004 and PAEY from March 23, 2004, until it
began trading as MBEU on August 9, 2004 as a result of the merger between Pan
American and Morgan Beaumont. The high and the low prices for the Company's
shares for each quarter of its last two fiscal years; and supplemented through
the last quarter of operations completed prior to filing the last amendment of
this Form 10-KSB/A. Price ranges for periods shown prior to August 31, 2004
relate to the Company's operations prior to its merger with Morgan Beaumont.


                                       37


<PAGE>

FISCAL QUARTER ENDED                   HIGH         LOW
--------------------                   ----         ---
August 31, 2002                       $4.75        $0.35
November 30, 2002                     $6.90        $2.75
February 28, 2003                     $7.40        $3.00
May 31, 2003                          $4.05        $1.65
August 31, 2003                       $0.90        $0.41
November 30, 2003                     $0.49        $0.41
February 28, 2004                     $1.45        $1.45
May 31, 2004                          $0.75        $0.75
August 31, 2004                       $0.52        $0.42
September 30, 2004                    $0.44        $0.34
December 31, 2004                     $0.83        $0.11
March 31, 2005                        $0.83        $0.94
June 30, 2005                         $1.10        $0.43

The source of the high and low bid price information is the OTC Bulletin Board.
The market quotations provided reflect inter-dealer prices, without retail
mark-up, markdown or commission and may not represent actual transactions. The
market information for the Company's shares for the periods after August 2004
relate exclusively to the business as presently operated. The Company is not
aware of any sales or transfer or any trading of shares of the Company or any
private transactions prior to its merger with the public company.

HOLDERS OF COMMON STOCK
-----------------------

As of September 30, 2004, there were sixty-six (66) registered shareholders of
the Company's common stock. As of August 31, 2005 there were 104 shareholders of
record.

DIVIDENDS
---------

There are no restrictions in the Company's Articles of Incorporation or bylaws
that restrict it from declaring dividends. The Nevada Revised Statutes, however,
prohibits the Company from declaring dividends where, after giving effect to the
distribution of the dividend:

     A.   The Company would not be able to pay its debts as they become due in
          the usual course of business; or

     B.   The Company's total assets would be less than the sum of its total
          liabilities, plus the amount that would be needed to satisfy the
          rights of shareholders who have preferential rights superior to those
          receiving the distribution.

The Company has neither declared nor paid any cash dividends on its capital
stock and do not anticipate paying cash dividends in the foreseeable future. The
Company's current policy is to retain any earnings in order to finance the
expansion of its operations. The Company's board of directors will determine
future declaration and payment of dividends, if any, in light of the
then-current conditions they deem relevant and in accordance with the Nevada
Revised Statutes.


                                       38


<PAGE>

RECENT SALES OF UNREGISTERED SECURITIES - DURING REPORTING PERIOD
-----------------------------------------------------------------

The Company did not complete any sales of unregistered securities during the
period covered by this report not previously reported in the Company's quarterly
reports filed on Form 10-QSB. As part of the Merger, the Company issued
13,000,017 shares of restricted common stock to the 39 shareholders of Morgan
Beaumont, Inc., in exchange for their shares of the then privately held Florida
corporation. The issuance of shares of common stock of the Company under the
merger was done without registration under the Securities Act of 1933, amended,
or qualification under the securities or "blue sky" laws of any jurisdiction.
The issued shares of common stock bear a restrictive legend stating that the
securities have not been registered under the Securities Act of 1933 and set out
the restrictions on transferability and sale of the securities.

The exemption which the Company relied on to issue the common stock in the
merger was Rule 506 of Regulation D of the Securities Exchange Act. Rule 506
requires the Company to inform unaccredited investors about the lack of
registration and resale restrictions of these securities and to provide these
investors with certain information about the Company which includes financial
and other information. The detailed information concerning the issuance has been
included in the Form 14C of the Company filed with the Securities and Exchange
Commission in connection with the merger on July 6, 2004.

SUBSEQUENT TO YEAR END
----------------------

Consummation of Common Stock Private Placement. The Company completed two
private placements of its common stock since September 30, 2004.

Common Stock. In December 2004, the Company completed the private placement of
an aggregate of 7,125,000 of shares of common stock to certain accredited
investors. The transaction was consummated pursuant to a Securities Purchase
Agreement by and among the Company and the purchasers. A copy of the Purchase
Agreement is attached as Exhibit 4.1. to the Company's Form 8-K of December 7,
2004. The net proceeds from the sale were used for working capital. The shares
are restricted from transfer and may only be transferred in compliance with
state and federal securities laws.


The purchasers received certain anti-dilution protection entitling the investors
to price adjustments in the event the Company sells shares for an effective
price of less than $0.20 per share within 1 year. Pursuant to the Purchase
Agreement, from the date thereof until 12 months after the date when the
registration statement to be filed pursuant to the Registration Rights Agreement
(defined below) is first declared effective by the Securities and Exchange
Commission, upon any financing by the Company of its common stock or common
stock equivalents, each Purchaser will have certain rights to participate in
subsequent financings. Notwithstanding the foregoing, any participation in
future financing pursuant to the Purchase Agreement shall not apply to the
issuance of shares of common stock or options to employees, officers or
directors of the Company pursuant to any stock or option plan to key consultants
or for purposes other than raising capital for the Company.



                                       39


<PAGE>

The Purchase Agreement contains various representations, warranties and
covenants of the parties customary for a transaction of this type. The Company
has agreed to indemnify the purchasers against various liabilities.

The Company entered into a Registration Rights Agreement effective November 30,
2004 with each purchaser, and agreed to file, within 45 calendar days of the
date of the filing of the Company's 10-KSB, a registration statement with the
SEC, covering the resale of (i) the Shares and (ii) any shares of common stock
issued or issuable upon a stock split, dividend or other distribution,
recapitalization or similar event together with the Shares , the "Registrable
Securities") for an offering to be made on a continuous basis pursuant to Rule
415. A copy of the Registration Rights Agreement is attached hereto as Exhibit
4.2.to the Company's Form 8-K of December 7, 2004. The Company will use its
reasonable best efforts to have the registration statement declared effective by
the SEC as soon as practicable thereafter. The Company and purchasers each
agreed with the other to indemnify the other for certain liabilities arising
under the Securities Act. Pursuant to the Registration Rights Agreement and
subject to certain other provisions therein, if the Company fails to timely
perform or provide in accordance with its responsibilities under the
Registration Rights Agreement and certain Securities Act provisions, then, in
addition to any other rights the holder or holders of the Registrable Securities
may have pursuant to the Registration Rights Agreement or under applicable law:
(x) on each such date when the Company has failed to timely perform or provide
under the Registration Rights Agreement, the Company shall pay to each holder an
amount in cash, as partial liquidated damages and not as a penalty, equal to
1.0% of the aggregate purchase price paid by such purchaser pursuant to the
Purchase Agreement for any Registrable Securities then held by such purchaser;
and (y) on each monthly anniversary of each such Event Date (if the applicable
event shall not have been cured by such date) until the applicable event is
cured, the Company shall pay to each purchaser an amount in cash, equal to 1.5%
of the aggregate purchase price paid by such purchaser pursuant to the Purchase
Agreement for any Registrable Securities then held by such purchaser. If the
Company fails to pay any partial liquidated damages pursuant to Section 2(b) of
the Registration Rights Agreement as summarized above in full within seven days
after the date payable, the Company will pay interest thereon at a rate of 18%
per annum (or such lesser maximum amount that is permitted to be paid by
applicable law) to the purchaser, accruing daily from the date such partial
liquidated damages are due until such amounts, plus all such interest thereon,
are paid in full. The partial liquidated damages pursuant to the terms of the
Registration Rights Agreement shall apply on a daily pro-rata basis for any
portion of a month prior to the cure of an event.


Pursuant to the Purchase Agreement executed by each purchaser, the Company
entered into an Escrow Agreement effective November 30, 2004 with Boyd & Chang,
LLP in which each Investor agreed to deposit amounts with Boyd & Chang LLP, and
Boyd & Chang LLP agreed to hold the escrow funds in its general attorney client
trust account established (the "Escrow Account"), and to administer the escrow
funds in accordance with the terms of this Agreement. No interest will be earned
on the escrow funds. A copy of the escrow agreement is attached hereto as
Exhibit 4.3. to the Company's Form 8-K of December 7, 2004.



                                       40


<PAGE>

The sale of common stock was made in accordance with an exemption from
registration pursuant to Section 4(2) of the Securities Act, and pursuant to
Rule 506 of Regulation D of the Securities Act. The Company did not solicit or
advertise the sales; a restrictive legend was placed on each certificate issued
describing the restrictions against resale. A Form D was filed with the SEC and
in each state where the investors reside. The Company paid no commission or fees
other than legal and accounting fees, in association with the offer and sale of
the Securities.

Common Stock and Warrants. In July 2005, the Company completed the private
placement of 12,362,500 shares of common stock and warrants to purchase
12,362,500 shares of common stock. The common stock and warrants were sold to
certain accredited investors in an offering made pursuant to Rule 506 of
Regulation D. The purchasers paid $0.40 in cash for each share of common stock,
and also received a warrant to purchase one share of common stock, resulting in
aggregate proceeds of $4,945,000. The Company incurred approximately $20,000 in
legal fees but paid no commissions, discounts, rebates or other incentives or
compensation in association with this offering. The net proceeds from the sale
will be used for general working capital purposes.

The purchasers received certain anti-dilution protection entitling the
purchasers to price adjustments in the event the Company sells shares for a
lower price. The Company also agreed to register the shares and the shares
underlying the warrants and has agreed to file, within 15 calendar days of the
effective date of the Company's S-2 Registration Statement, a registration
statement with the SEC, covering the resale of the shares and the shares of
common stock underlying the warrants.

The warrants are exercisable, in whole or in part, at any time until July 1,
2007 at a price of $0.60 per share, payable in cash. Beginning 30 days after the
shares underlying the warrants have been registered; the Company may redeem or
cancel the warrants if they have not been exercised in full by the tenth
business day which the Company's shares are traded for in excess of $1.20 per
share. Except as set forth above, the terms of the July offering were
substantially the same as the December offering.

Common Stock to MTel. Pursuant to that certain agreement between Morgan
Beaumont, Inc. ("the Company") and MTel Communications, Inc. ("MTel") for the
purchase and sale of certain assets of MTel, the Company was to release a Morgan
Beaumont or MTel re-loadable phone cards and/or phone/debit cards within 120
days of the execution of the agreement. The Company was unable to release
phone/debit cards within the specified period which resulted in the Company
being obligated to issue 246,753 shares of the Company's restricted common stock
to MTel. The Company reached an agreement with MTel in which it paid $50,000 and
140,000 shares of the Company's restricted common stock to MTel to satisfy the
Company's obligation.

AMENDMENT OF NOTE AGREEMENT WITH PAUL MARSHALL
----------------------------------------------

The former controlling shareholders of Pan American defaulted on certain
provisions of the Merger Agreement which resulted in a modification of the
Merger Agreement and the transfer of approximately 1,000,000 shares from the
former controlling shareholders to the original shareholders of Morgan Beaumont.
Copies of this Agreement were filed with and described in the Company's 8-K
dated December 7, 2004.


                                       41


<PAGE>

Marshall's default under the Promissory Note (the "Note") would entitle the
original shareholders of the Morgan Beaumont ("Original Shareholders") and
Morgan Beaumont to rescind the merger. As part of the partial rescission of the
merger, Marshall has agreed to deliver to the Original Shareholders a total of
1,000,000 free trading shares of the Company's stock acquired by the Pan
American shareholders in the merger, which will be divided pro-rata by the
Original Shareholders based upon their pre-merger stock ownership of the
Company.

The Company and Marshall agreed to modify the Promissory Note to provide for
extended payment terms on the remaining principal balance of the Note and, in
further consideration of and exchange for the Note and the waiver of past
penalties and default interest, Marshall agreed to pledge 2,400,000 shares of
common stock (the "Pledged Shares") of the Company to be used at the discretion
of the Company, subject to Board approval as security for the performance of
Marshall's obligation under the Note. In exchange for the partial rescission,
the Note and the other terms set forth above, including the Pledged Shares, the
Company and the Original Shareholders agreed to waive the right to fully rescind
the merger and to enforce the terms of the original Promissory Note.

The legal costs to the Company as a result of the default and general clean up
of the Company was approximately $40,000. Additionally, the Company believes the
lack of capital resulting from the default caused a six-month delay the issuance
of card programs and by so doing delayed revenue generation from these card
programs. The Company estimates that the additional cost of this delay was
approximately $300,000.

As of August 31, 2005, Marshall had paid all of the principal and interest due
under the Note but the costs claim of $40,000 remained unpaid.

MANAGEMENT'S DISCUSSION AND ANALYSIS AND PLAN OF OPERATION

PLAN OF OPERATIONS
------------------

SUMMARY.

Information prior to August 24, 2004 (the date of the reverse acquisition)
related to or predecessor entity, Pan American, has been omitted. From a legal
perspective, Pan American is the surviving company and thus continues its public
reporting obligations. However, from an accounting perspective, Morgan Beaumont
is treated as though it acquired Pan American. Therefore, all financial
information presented in this 10KSB includes Morgan Beaumont's standalone
results from the period July 10, 2000 (date of incorporation) to September 30,
2004.

As part of the merger, Morgan Beaumont changed its year end from December 31 to
September 30. As a result of this change information contained herein includes
the year ended September 30, 2004 (nine months) and the year ended December 31,
2003.


                                       42


<PAGE>

RESULTS OF OPERATIONS. Planned principal operations of the Company commenced in
2000, however, to this date it has received limited revenues. In June 1975, the
Financial Accounting Standards Board, in its Statement No. 7, set forth
guidelines for identifying an enterprise in the development stage and the
standards of financial accounting and reporting applicable to such an
enterprise. In the opinion of management of the Company, the Company and its
activities from its inception through September 30, 2004 fall within the
referenced guidelines. Accordingly, the Company has reported its activities in
accordance with the aforesaid Statement of Financial Accounting Standards No. 7.

LACK OF PROFITABILITY OF BUSINESS OPERATIONS SINCE 2001. The Company was
initially focused exclusively on the sales of the Products. It became apparent
there was a flaw in solely focusing on the sales of the products, so management
made the decision to expand its focus to include the development of a process to
allow the consumer to perform value loads in a retail environment. The time and
expense of developing the process and associated technology kept the Company
from achieving profitability.

Moreover, when the Company started some sales in 2001, those efforts were halted
due to an issue involving MasterCard and the issuing bank programming deviancies
that the bank had in supply paperwork to MasterCard on Morgan's programs; Morgan
stopped shipping the Products and had been working with multiple banks
processors to develop a program with the bank, MasterCard and Visa approval. The
Company instituted a suit against that issuing bank as described on page 29 of
this report. During that time, the Company had also been developing processes
and technology to allow cards to be loaded on the cards. Additionally, the
Company's revenues were initially used to maintain operations. The Company
needed to raise additional revenue to proceed with operations and launch the
Company's programs, products and services.

However, this process is now well defined and the technology has been rolled out
in a limited release and is now ready for all of the company's strategic
partners to commence rolling out in a general availability mode. The Company
anticipates profitability will occur when it has approximately no less 50,000
retail load locations operational and approximately 100,000 to 150,000 cards
actively used by consumers and a sufficient number of POP in the geographic
location which are higher in density in cardholders. Profitability is also
dependent on the expansion of load stations and the expansion of the programs
for the card products.

SALES AND REVENUES. Revenues for the nine months ended September 30, 2004, the
year ended December 31, 2003 and the period July 10, 2000 (date of
incorporation) to September 30, 2004 were $58,602, $355,872, and $590,219
respectively. Revenue was down in the nine months ended September 30, 2004 by
eighty-three percent of the reduced number of months in the reporting period and
also because MasterCard cancelled the Company's program through First National
Bank of Central Texas as disclosed on page 29 of this report. The program was
not replaced until July and therefore sales were not made nor were significant
revenue earned from April 2004 to July of 2004. During the nine months ended
September 30, 2004 the Company had an average of approximately 5,800 Points of
Presence ("POPS") excluding the approximate 15,000 Bank of America locations
that can load some of the Company's products. These POPS were restricted to
loading its cards and did not market the Company's cards. Cost of Sales for the
nine months ended September 30, 2004, the year ended December 31, 2003 and the
period July 10, 2000 (date of incorporation) to September 30, 2004 were $35,833,
$186,245, and $316,162 respectively. The eighty-one percent decline in 2004 was
the result of reduced revenue in the reporting period.


                                       43


<PAGE>

During fiscal year 2005 the Company intends to expand the number of access
points; Morgan Beaumont has in place contracts that management believes have the
potential to grow its access points to over 100,000 POPS. These POPS will now
sell or load (or both) debit/ATM and stored value hologram cards to the public.
As of August 31, 2005, the Company had approximately 98,000 POPs under contract,
under 22,000 were fully functioning, while 76,000 are in various stages of
implementation and will become active by October 31, 2005. As of September 30,
2004, the Company had approximately 20,000 POPs active and as of December 31,
2003, the Company had less than 16,000 POPs active.

The Company has four sources of sales and revenue: initiation fees, subscription
fees, transaction fees and financial "float." It generates income from the sale
of the Morgan Beaumont Money Card, the Morgan Beaumont Stored Value MasterCard,
its monthly maintenance fees associated with keeping the card active and from
transaction fees. Income is also generated at the SIRE Network when consumers
load cash into their card account so the card can be used for day to day
purchases. Additional revenue is generated at the IVR when consumers activate
their card and "up sell" opportunities at the IVR level. Future potential
products for consumers to purchase at this level include Discount Health
Benefits, Discount Medical Benefits, Road Side Assistance and Vacation offers.

Hosting and Licensing Fees are charged for the use of proprietary Morgan
Beaumont technology. In a Hosted Agreement, the customer is not required to
purchase the technology, but only pay transaction fee for each use. These fees
are defined in a service agreement with the customer that stipulates a minimum
monthly fee for the use of the technology and is typically a 2-year term. In a
licensing agreement, the customer pays a fee for each product sold, (the product
can be sold under the Morgan Beaumont brand, or can be private labeled for the
customer), and also pays for any minor changes to the technology required to
meet the specific market the customer wishes to address. Transaction fees are
derived from the use and loading of cash of for ATM, debit or Stored Value Cards
and monthly maintenance fees associated with keeping ATM, debit or Stored Value
Cards active.

DECLINE IN REVENUE THROUGH DECEMBER 2004. As described on page 16 of this
report, Morgan Beaumont merged with and into Pan American in August 2004, the
separate existence of Morgan Beaumont ceased and Pan American continued as the
Surviving Corporation under the name Morgan Beaumont, Inc. However, the Company
incurred additional expenditures with the Pan American shell during the period
ending December 2004, because the money to purchase the shell was late and the
structure shell was not what was represented.

During the development of the processes and technology for the retail based SIRE
Network as described above, there was a decreased emphasis on sales of new cards
due to the market research showing consumers unwillingness to actively use the
card products without a suitable value load solution. The decline in revenue is
attributable to the decreased sales effort and the merger with Pan American. The
Company also had difficulty obtaining a quality issuing bank. In August 2003,
the Company lost its issuing bank when the bank lost its MasterCard
certification. The Company was not able to ship cards products until the first
quarter of 2005. In this period of time, the Company was focusing with on the
approval of processes, establishment of bank relationships, development of the
Company's technology and the approval by the banks institutions. The Company is
filed a lawsuit with the responsible bank for damages as described on page 29 of
this report.


                                       44


<PAGE>

OPERATING EXPENSES. Selling, General and Administrative expenses for the nine
months ended September 30, 2004, the year ended December 31, 2003 and the period
July 10, 2000 (date of incorporation) to September 30, 2004 were $1,029,125,
$1,118,753 and $2,896,467, respectively. The decline in Operating expenses of
eight percent for the period ended September 30, 2004 compared to the year ended
December 31, 2003, was primarily attributable to the reduced period of time
covered in the reporting period. When comparing the average expenses per month
during the reporting period, they actually increased twenty-three percent to a
$114,347 average per month versus an average of $93,229 per month in the prior
period as a result of the following significant expense items.

Stock based compensation and other non cash expenses was $92,677, $772,030 and
$1,277,315 for the nine months ended September 30, 2004, the year ended December
31, 2003 and the period July 10, 2000 (date of incorporation) to September 30,
2004, respectively. The eighty-eight percent decrease in 2004 compared to 2003
in these expenses were primarily related to the fact that employee compensation
in 2004 was primarily paid with cash as opposed to 2003 when a significant
portion of its salary and wages was paid with stock.

Employee compensation and benefits increased from $248,430 to $624,972 for the
twelve months ended December 31, 2003 compared to the nine months ended
September 30, 2004 respectively. The increase of one hundred and fifty two
percent was due to the addition of Typhoon employees as well as the payment of
many employees with cash who had been paid with stock in the twelve months ended
December 31, 2003.

Professional and consulting fees increased seven hundred ninety-three percent
from $15,796 for the year ended December 31, 2003 to $141,116 for the nine
months ended September 30, 2004, because of the professional services related to
the business combination with Pan American and the Company's filings with the
SEC.


Purchased in-process research and development was $153,190 during the year ended
December 31, 2003, which arose from the purchase of the net assets of Typhoon
Voice Technologies, Inc.


Impairment of long lived assets amounted to approximately $43,200 for the nine
months ended September 30, 2004. Statement of Financial Accounting Standards
(SFAS) 144, "Accounting for the Impairment or Disposal of Long-Lived Assets"
requires that long-lived assets, including certain identifiable intangibles, be
reviewed for impairment whenever events or changes in circumstances indicate
that the carrying value of the assets in question may not be recoverable. The
Company evaluated its long-lived assets during the nine months ended September
30, 2004 and determined that certain impairment losses were necessary.

LOSS FROM OPERATIONS. As a result of the above, the Company's net losses
increased eight percent to $1,031,335 in the nine months ended September 30,
2004 from $954,974 in the twelve months ended December 31, 2003. From inception
the Company has lost $2,654,937. The average loss per month in the twelve months
ended December 31, 2003 was $79,581 compared to $114,593 for the nine months


                                       45


<PAGE>

ended September 30, 2004, a forty-four percent increase. The increase in the
rate of loss related to the lack of an actively shipping product during the
majority of the period ended September 30, 2004 while the Company increased
staffing and marketing activities and the substantial amount of its time the
Company spent a to securing adequate funding and completing the merger with
PAEC.

LIQUIDITY AND CAPITAL RESOURCES.

From inception to September 30, 2004, the Company raised $310,063 from sales of
its common stock, borrowed on notes payable a total of $97,912 and received
$971,051 of payments under a note receivable from Paul Marshall, a stockholder.
The Company used these proceeds to fund operating activities of $1,056,035, to
purchase property and equipment of $148,249 and to purchase certain assets of
Typhoon Voice Technologies for $5,000. On September 30, 2004, the Company had a
cash balance of $121,832 which was not sufficient to operate the Company in
fiscal year 2005. Management under took efforts to raise additional capital to
enable the Company to continue to operate.


Subsequent to September 30, 2004, the Company received an additional approximate
$2,075,000 under the aforementioned note receivable from Paul Marshall and
approximately $1,425,000 from the sale of the Company's common stock. After
paying outstanding liabilities, financing operations and additional investments
in technology, the Company had approximately $606,000 of cash available at May
15, 2005. As of June 30, 2005 the Company had cash of $3,062,742 and was in
the process of collecting the proceeds from the sale of stock of an additional
$1,895,000 which was fully collected on July 20, 2005.

Management believes these funds will be sufficient to fund operations for the
foreseeable future; however, the Company's ability to continue as a going
concern must be considered in light of the problems, expenses and complications
frequently encountered by entrance into established markets and the competitive
environment in which it operates. Since inception, the Company's operations have
primarily been funded through private equity, and the Company may need to seek
additional funding through private or public equity and/or debt financing.
Finally, the Company expects that operating revenues from the sales of its
products and other related revenues will increase. However, there can be no
assurance the Company will not need to raise additional funds to continue
operations or that the Company will be able to raise additional debt or equity
capital and/or any cash generated by its operations. These factors, among
others, indicate that the Company may be unable to continue as a going concern
for a reasonable period of time.


Management will require additional capital resources for the expansion of the
Company's marketing and further improvement of its technology as well as to
improve the financial controls over the Company. The Company is adding
additional experienced personnel in Marketing, Technological and Finance in
order improve market penetration and profitability.

CHANGES IN NUMBER OF EMPLOYEES. To support the expansion of POPs, the
substantial marketing effort, and the increased administrative needs, the
Company anticipates that the development of its business will require the hiring
of additional employees. Over the course of 2005 and beginning in January, the
Company had planned to and did add additional programmers and sales personnel to
enable it to meet its marketing and operational objectives.


                                       46


<PAGE>

OFF-BALANCE SHEET ARRANGEMENTS

The Company has no significant off-balance sheet arrangements that have or are
reasonably likely to have a current or future effect on its financial condition,
changes in financial condition, revenues or expenses, results of operations,
liquidity, capital expenditures or capital resources that is material to
stockholders.

CRITICAL ACCOUNTING POLICIES

The preparation of financial statements in conformity with United States
generally accepted accounting principles requires the Company's management to
make estimates and assumptions that affect the reported amount of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.
The Company's management routinely makes judgments and estimates about the
effects of matters that are inherently uncertain.

Internal-Use Software
---------------------

The Company accounts for costs incurred for internal-use software in accordance
with Statement of Position No. 98-1 "Internal Use Software." ("SOP No. 98-1").
Under SOP No. 98-1, the Company is required to capitalize certain development
costs related to internal-use software. The externally purchased developer kits
for use in the development of Point of Sale (POS) software are being amortized
over the useful life.

Stock - Based Compensation
--------------------------

The Company has adopted Statement of Financial Accounting Standards No. 148
"Accounting for Stock-Based Compensation - Transition and Disclosure" (SFAS No.
148). This statement amends FASB statement No. 123, "Accounting for Stock Based
Compensation". It provides alternative methods of transition for an entity that
voluntarily changes to the fair value based method of accounting for employee
stock based compensation. It also amends the disclosure provisions of FASB
statement No. 123 to require prominent disclosure about the effects on reported
net income of an entity's accounting policy decisions with respect to
stock-based employee compensation. As permitted by SFAS No. 123 and amended by
SFAS No. 148, the Company continues to apply the intrinsic value method under
Accounting Principles Board ("APB") Opinion No. 25, "Accounting for Stock Issued
to Employees," to account for the Company's stock-based employee compensation
arrangements.

Additional accounting policies are disclosed in Note A to the consolidated
financial statements included in this annual report.

FINANCIAL STATEMENTS

The Company's auditors report, as well as the following consolidated financial
statements of the Company as of and for the various periods ended September 30,
2004, and for the year ended December 31, 2003 are included in this report
following page 69 at the pages indicated:


                                       47


<PAGE>

                                                                            Page
                                                                            ----

Report of Independent Registered Public Accounting Firm...................  F-4

Financial Statements as of and for various periods ended
   September 30, 2004, and for the year ended December 31, 2003:

     Balance Sheet........................................................  F-5

     Statements of Operations.............................................  F-6

     Statements of Stockholders' Equity (Deficit).........................  F-7

     Statements of Cash Flows.............................................  F-8

     Notes to Financial Statements........................................ F-11

CHANGES IN CERTIFYING ACCOUNTANTS.

Dismissal of Previously Engaged Accountant
------------------------------------------

On September 28, 2004, Morgan & Company Chartered Accountants, the former
principal accountant for the Company, was dismissed in anticipation of a merger
and reorganization and change of control of the Company. The former accountant's
report on the financial statement of the Company for either of the past two
years did not contain an adverse opinion or a disclaimer of opinion and was not
qualified or modified as to uncertainty, audit scope, or accounting principles.
The decision to change accountants for the Company was approved by the Board of
Directors on September 28, 2004.

During the Company's two most recent fiscal years and any subsequent interim
period preceding such dismissal, there were no disagreements with the former
accountant on any matter of accounting principles or practices, financial
statement disclosure, or auditing scope of procedure, which would have caused it
to make reference to the subject matter of the disagreement in connection with
its report.

The Company was not involved in any events within its two most recent fiscal
years and any subsequent interim period preceding the former accountant's
dismissal which are the reportable kind as required by Item 304(a)(1) of
Regulation S-K.

The Company had provided the former accountant with a copy of the disclosures it
is making in the Form 8-K of October 4, 2004 in response to Item 304(a) of
Regulation S-K that the former accountant received no later than the day that
the disclosures were filed with the Commission. The former accountant had
furnished to the Company a letter addressed to the Commission, a copy of which
is attached as an Exhibit to the Company's report on Form 8-K describing the
change stating that he agreed with the statements made by the Company in
response to this Item 304(a).


                                       48


<PAGE>

Engagement of New Independent Accountant
----------------------------------------

On September 28, 2004, the Company engaged Kingery & Crouse, P.A. ("Kingery &
Crouse") as the new principal accountants for the Company. During the Company's
two most recent fiscal years, and any subsequent interim prior to engaging the
accountant, the Company did not consult Kingery & Crouse regarding either: (i)
the application of accounting principles to a specified transaction, either
completed or proposed, or the type of audit opinion that might be rendered on
the Company's financial statements; or (ii) any matter that was either subject
of a disagreement or a reportable event.

CONTROLS AND PROCEDURES

As required by Rule 13a-15 under the Exchange Act, the Company carried out an
evaluation of the effectiveness of the design and operation of the Company's
disclosure controls and procedures as of September 30, 2004, being the date of
the Company's fiscal year end covered by this Annual Report. This evaluation was
carried out under the supervision and with the participation of its Chief
Executive Officer and its Chief Financial Officer. Based upon that evaluation,
the Company's Chief Executive Officer and Chief Financial Officer concluded that
its disclosure controls and procedures were not effective in timely alerting
management to material information relating to the Company required to be
included in its periodic SEC filings. There have been no significant changes in
the Company's internal controls or in other factors that could significantly
affect internal controls subsequent to the date it carried out its evaluation.

Based on the evaluation, which disclosed no significant deficiencies or material
weaknesses that are not being addressed in the actions currently being taken to
improve its disclosure controls and procedures, the Company has identified
certain deficiencies and issues with its internal controls that occurred in
fiscal year end 2004. These deficiencies and issues include, but are not limited
to:

     o    Deficiencies related to inadequate or ineffective policies for
          documenting transactions. The Company identified deficiencies in its
          controls relating to certain non-accounting documentation. The Company
          discovered instances where certain corporate documents were not filed
          or otherwise properly processed.

     o    Deficiencies related to the internal control environment. The Company
          has determined that for the period ended September 30, 2004, it had
          deficiencies due to inadequate staffing in its accounting department
          and the lack of a full-time Chief Financial Officer. The Company has
          hired a Chief Financial Officer subsequent to year end, and expects
          these controls will improve during the fiscal year end 2005.

Disclosure controls and procedures are controls and other procedures that are
designed to ensure that information required to be disclosed in its reports
filed or submitted under the Exchange Act is recorded, processed, summarized and
reported, within the time periods specified in the Securities and Exchange
Commission's rules and forms. Disclosure controls and procedures include,
without limitation, controls and procedures designed to ensure that information
required to be disclosed in the Company's reports filed under the Exchange Act
is accumulated and communicated to management, including its Chief Executive
Officer and Chief Financial Officer, to allow timely decisions regarding
required disclosure.


                                       49


<PAGE>

During the nine months ended September 30, 2004, there were no changes in the
Company's internal control over financial reporting that have materially
affected, or are reasonably likely to affect, its internal control over
financial reporting. An Accounting Policy and Procedures Manual has been drafted
to address many of the internal control issues related to financial reporting
and is currently being implemented. The Company feels the Financial Reporting
issues are being addressed and will improve in the fiscal year of 2005.

The term "internal control over financial reporting" is defined as a process
designed by, or under the supervision of, the registrant's principal executive
and principal financial officers, or persons performing similar functions, and
effected by the registrant's 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 registrant;

     (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 registrant 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 registrant's
          assets that could have a material effect on the financial statements.

                                    PART III

DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

The following table sets forth the names, ages, and positions with the Company
for each of the directors and officers of the Company as of September 30, 2004.
As described below, certain officers and directors have resigned or assumed new
positions.

Name                              Age     Position                         Since
----                              ---     --------                         -----

Clifford Wildes (1)               54      Chief Executive Officer,         2001
                                          Treasurer and Director

Kenneth Craig (2)                 50      Chief Financial Officer,         2002
                                          Secretary and Director

Erik Jensen (2)                   46      President, Chief Operating       2003
                                          Officer and Director


                                       50


<PAGE>

James Smith III                   38      Chief Technical Officer          2004

Rod Braido (3)                    59      Vice-President and Director      2001

Mark Brewer                       46      Director                         2002

Virgil "Brother" Sandifer, Jr.    49      Director                         2004

Benjamin J. Bond                  63      Director                         2004

Theodore Misiewicz (2) (3)        45      Director, Secretary and Chief    2005
                                          Financial Officer

(1) Mr. Wildes was a founding shareholder and has been a member of the board of
directors since formation of the Company. From incorporation through February
2001 Ron Noce was the Company's CEO. Upon his resignation, Rod Braido became
CEO. Mr. Braido resigned as CEO in February 2002 and Cliff Wildes became CEO. In
May 2002, Ken Craig joined the Company and took over as CEO and held that
position until becoming CFO in November 2003, at which time Mr. Wildes again
assumed the CEO position.


(2) Effective January 2005, Ken Craig became Chief Operating Officer of the
Company and Theodore Misiewicz took over as Chief Financial Officer. Effective
June 1, 2005 Ken Craig took over responsibility for operations of the
telecommunications subsidiary. Effective August 31 2005, the Company and Ken
Craig entered into a separation agreement and Mr. Craig resigned as an officer
of the Company. Pursuant to the terms of his separation agreement, Mr. Craig
will receive a lump sum severance payment of $82,500, less ordinary payroll
withholdings, and he agreed to a bleed out structure to limit the sales of his
shares of the Company to 3% of the shares held by him, any of his family members
or any entity controlled by him other than his father, per month for a period of
6 months. Mr. Craig remained as director of the Company until October 1, 2005,
when he was replaced by Joseph Hudgins.


(3) Effective January 2005, Rod Braido resigned as a member of the Board of
Directors and Theodore Misiewicz was appointed to the board to fill the vacancy.
Effective July 1, 2005, Mr. Braido resigned as an officer of the Company.


                                       51


<PAGE>

CLIFFORD WILDES - Chief Executive Officer, Director and Founder. Mr. Wildes has
been with Morgan Beaumont since it was founded. Prior to serving in roles as
CEO, COO, CFO, President and Founder of the Company, Mr. Wildes was CEO and
Founder of several companies within the hi-tech sector, as well as business
consulting services.

     o    Mr. Wildes is the former founder and CEO of Microtech International
          Inc., a private company that he sold to a Japanese public company in
          1995.
     o    He was also the founder and CEO of Nova Interactive Inc., which he
          sold to a public company in 1997.
     o    Mr. Wildes was co founder and an Officer of Barclay Partners Inc. from
          1996 to 1998.
     o    Mr Wildes is founder and CEO of Meridian Capital Inc a business
          consulting services from 1997 - 2004.
     o    From 1997 to 2001, Mr. Wildes consulted, or has been employed with,
          various public companies holding positions as their CEO, COO and Vice
          President and managing the operations of those companies on a
          temporary or interim basis.
     o    Mr. Wildes served as the interim CEO of Beverly Hills Limited, a
          public company where he was engaged by Board of Directors and its
          largest shareholder from April 1999 to July 1999 to evaluate and
          assist in evaluating potential acquisitions candidates for Beverly
          Hills Ltd.
     o    From September 1999 to December 1999, he served as COO of WCollect, an
          online art auction company, where he was hired at the request of a
          financing group to evaluate and assist in operations.
     o    From January to December 2000, Mr. Wildes was an affiliate of
          MacKenzie Shea, a business consulting firm. As such, Mr. Wildes was
          placed as officer or director of several companies in need of
          management or operational guidance on a temporary basis, similar to
          what Mr. Wildes had previously done on his own. As part of this role
          with MacKenzie, Mr. Wildes helped form and operate Siesta Acquisition
          Corp, Inc., the parent company of Siesta Telecom Inc. a telecom
          operation purchased from Fusion, Inc. Mr. Wildes also served from
          February 2001 to June 2001 as director of Key Card Communications,
          Inc., a private company seeking to merge with a public company, and as
          a vice president of the Company from August 2001 to December 2001
          after it merged with a non-trading, but fully reporting public
          corporation in November 2001.
     o    From December 2000 to January 2004, Mr. Wildes continued his business
          consulting services as CEO of Meridian Capital, Inc. while he was
          simultaneously an officer and director of Morgan Beaumont, Inc. In
          January 2002, Mr. Wildes began working full time for the Company.

Mr. Wildes received a Bachelor of Science degree in Political Science and
Economics from the University of Massachusetts (formerly "Boston State College")
in Boston in 1972.

KENNETH CRAIG - Chief Financial Officer and Director; effective January 2005,
Chief Operations Officer and Director. Mr. Craig has an extensive background in
the operations of public and private companies, having served as CEO and
President, or Vice President of various companies, for the past 20 years. These
companies include, ICT Worldwide, Inc. where he acted as Vice President, which
required extensive international travel and interface with Foreign Governmental
Ministries and the Business and Trade Divisions of the U.S. Embassy; Global
Resources Group, Inc. where he served as CEO for their public registration, PPM,


                                       52


<PAGE>

as well as conducted in-depth interface with SEC. Additionally, he is the past
CEO and President of Divot Golf Corporation, Miller Golf Products and
Renaissance Golf Products, Inc. Mr. Craig was Division President of Wiltel
Communications ("Wiltel"), a Williams Company, and is a licensed attorney in
Mississippi and Texas. Mr. Craig received a Bachelor in Business Administration
(Accounting Area) from Stetson University in 1976 and a Juris Doctorate from
University of Mississippi in 1980.

Mr. Craig was an interim Vice President at Key Card Communications from January
2002 to March 2002.


Mr. Craig had been with the Company since mid 2002 serving in various capacities
as its CEO in 2002, its CFO in 2003, its COO in 2005 and headed up MBI Services
LLC as its President in 2005. He has been a board member during his tenure. Mr.
Craig resigned from the Company as its COO effective August 31, 2005 to pursue
personal interests and spend time with his family. He resigned from the board
effective October 1, 2005. The Company has benefited from Mr. Craig's years of
experience as an attorney and former President of Wiltel and his experience in
working with public companies.


ERIK JENSEN - President, Chief Operating Officer and Director; effective January
2005, President and Director. Mr. Jensen has co founded and sold a number of
technology start up companies over the past 15 years. Prior to joining the
Company, Mr. Jensen was President, Director and Co-Founder of Typhoon Voice
Technology from 2001 to 2003, a software development company described in Item 1
of this report, which was acquired by the Company. From 1999 to 2002, Mr. Jensen
was Technology marketing manager for all VoIP solutions. He has extensive
experience in the telecommunications industry and related technology. He has
held executive positions at Callware Technologies and Comdial Corporation, which
is currently active. Mr. Jensen has studied Business Administration and
Management Information Systems from 1977 to 1988.


JOSEPH HUDGINS - Effective October 2005, Director. Mr. Hudgins has over 25 years
experience in the banking industry. Mr. Hudgins is Executive Vice President of
First National Bank of Pennsylvania in Sarasota, which is currently active,
where he manages its operation in Florida. Hudgins has held senior executive
positions with First Third Bank of Florida in 2001 and with First National Bank
of Florida from January 2001 through December 2004. Mr. Hudgins was President
with First National Bank of Florida F.K.A. West Coast Branch from 1992 through
2003, with SouthTrust Bank of Sarasota from 1990 through 1991 and with
SouthTrust Bank of Decatur from 1986 through 1990. From 1978 to 1986, Mr.
Hudgins was Vice President for First Union National Bank of Rome. Mr. Hudgins
was also Assistant Branch Manager with Valley Fidelity Bank from 1977 through
1978. Mr. Hudgins received a Bachelors Degree in Mathematics from Carson-Newman
College in 1977 and received a Masters of Business Administration in Banking
Management from the University of Virginia in 1982.


JAMES SMITH III - Chief Technical Officer. Mr. Smith has over 15 years
experience creating world class software solutions in various arenas. Prior to
starting with the Company, Mr. Smith co-founded Typhoon Voice Technologies,
which was acquired by the Company, where he was the Chief Technology Officer and
Chief Technical Architect of the Activate Manager IVR system. From 2000 to 2003,


                                       53


<PAGE>

Mr. Smith was the Senior Internet Software Engineer of Comdial, which is
currently active. From 1999 to 2000, Mr. Smith was the Team Leader/ Internet
Software Engineer of Merant Interactive, which is currently active, where he
created complex innovated Internet Solutions. From 1992 to 1999, he was TSM
Engineer IV, TSM Engineer III, and TSM Engineer II of Alcatel Network Systems,
which is currently active, where he developed software for SONET Telecom gear.
From 1989 to 1992, Mr. Smith was the Associate Programmer of International
Business Machines and from 1986 to 1988, he was the College Co-op of
International Business Machines, which is currently active. Mr. Smith received a
Bachelor of Science in Computer Science from Michigan State University in 1989
and is expecting to receive his Masters of Business Administration at Ellis
College in 2006. Mr. Smith resigned from the Company January 2005.

ROD BRAIDO -Vice President, and Director; effective January 2005, Vice
President. Mr. Braido has over 25 years of experience in the Computer Hardware
and Semiconductor Industries. Mr. Braido heads up the Company's west coast
office. Mr. Braido was most recently Vice President of Strategic Programs at
Bell Microproducts (NASDAQ:BELM). Mr. Braido was a partner in Meridian Capital,
Inc. Mr. Braido served as a Chief Executive Officer of the Company in its start
up stage. In 1998, Mr. Braido, as the founder, held the positions of President
and Chief Executive Officer of NetAttach, Inc. VA Linux System of Santa Clara,
Ca, acquired NetAttach in April of 2000, (NASDAQ: LNUX). Prior to founding
NetAttach, Mr. Braido was Senior Vice President of computer product sales and
Senior Vice President and general manager of Bellstor Memory Systems, a division
of Bell Microproducts. From 1989 to 1996, Mr. Braido was Vice President of World
Wide Sales and General Manager of the systems division of SyQuest Technology.
Mr. Braido worked with Mr. Wildes when he was Vice President of Sales and Chief
Operating Officer with Microtech International Inc. Prior to 1987 Mr. Braido
served with National Semiconductor (NASDO: NSM), for over 10 years, in a number
of sales management roles.

MARK BREWER - Director. Mr. Brewer has served as the Marketing Director for One
World Nutrition, a nutritional supplement company, since January 2003. He is the
Managing Director of Novus Capital Investment Fund. Since May of 2002, he has
served as Vice President of Lighthouse II, Inc., a marketing company. From 1997
to 2002, he has also served as President of HydroMaid International,
manufacturers of water-powered disposal units. Mr. Brewer attended the
University of Phoenix where he received a Bachelor of Arts in Business
Administration in 1985.

BENJAMIN J. BOND - Director, Audit Committee Member, Compensation Committee
Member. Mr. Bond is a certified public accountant. For the past 10 years, Mr.
Bond has been in private accounting practice specializing in tax and consulting.
Mr. Bond received a Bachelor of Science in Business Administration from the
University of Florida in 1966.

VIRGIL LEE "BROTHER" SANDIFER, JR. - Director, Audi Committee Member,
Compensation Committee Member. Mr. Sandifer is a certified public accountant and
managing partner of the accounting firm of Sayle, Sandifer & Associates, LLP,
where he has practiced since 1980. Mr. Sandifer attended the University of
Mississippi where he received a Bachelor of Arts in Accounting in 1977 and a
Master of Business Administration in 1979.


                                       54


<PAGE>

THEODORE MISIEWICZ - Effective January 2005, Director and Chief Financial
Officer. Mr. Misiewicz is a certified public accountant. He is a financial and
operations professional with more than twenty years of extensive operational
responsibilities in a wide variety of industries including computer
manufacturing, Licensing Financial Services, Affinity Marketing, the Gift
Market, Collectibles, Syndication and Consulting. Mr. Misiewicz was director and
manager of corporate accounting for QMS, Inc. from 1985 through 1994. During the
course of his employment, that Company grew from approximately $50 million in
sales to over $300 million as a public corporation. From 1994 through 1995, Mr.
Misiewicz was Vice President of Finance & Administration for Jordan American
Holdings, Inc. where he was responsible for all corporate financial and
administration of the publicly traded holding company including accounting and
budgeting. He accomplished the tax-free spin-off of an unprofitable division
that served to materially reduce the shares and increase the book value per
share. From 1996 through 2000, he was secretary and treasurer for Mill Pond
Press, Inc. Mr. Misiewicz was Chief Financial Officer of Atlantic Syndication
from 2000 through 2004 and Senior Executive Analyst for American Management
Services from March 2004 through May 2004. Mr. Misiewicz attended Western
Michigan University where he received a Bachelor of Business Administration.

INVOLVEMENT IN CERTAIN LEGAL PROCEEDINGS
----------------------------------------

To the best of the Company's knowledge, during the past five years, no present
or former director, executive officer or person nominated to become a director
or executive officer of the Company:

     o    filed a petition under federal bankruptcy laws or any state insolvency
          law, nor had a receiver, fiscal agent or similar officer appointed by
          a court for the business or property of such person, or any
          partnership in which he was a general partner at or within two years
          before the time of such filing ,or any corporation or business
          association of which he was an executive officer at or within two
          years before the time of such filing;
     o    was convicted in a criminal proceeding or being subject to a pending
          criminal proceeding (excluding traffic violations and other minor
          offenses);
     o    was the subject of any order, judgment or decree, not subsequently
          reverse, suspended, or vacated, of any court of competent
          jurisdiction, permanently or temporarily enjoining him or her from or
          otherwise limiting his/ her involvement in any type of business,
          securities, or banking activities; or
     o    was found by court of competent jurisdiction in a civil action , by
          the SEC or the Commodity Futures Trading Commission, to have violated
          any federal or state securities law, and the judgment in such civil
          action or finding by the SEC has not been subsequently reversed,
          suspended, or vacated.

SIGNIFICANT EMPLOYEES
---------------------

The Company has no significant employees other than its officers and directors.
The Company conducts its business through agreements with consultants and
arms-length third parties.


                                       55


<PAGE>

EMPLOYMENT AGREEMENTS
---------------------

The Company's Executive Officers each have employment agreements that were
renegotiated after the end of the Company's fiscal year end, under thee terms
set forth below:

CLIFFORD WILDES

Cliff Wildes entered into a three (3) year employment agreement pursuant to
which he will receive an annual salary of $185,000 for the first year, $205,000
for the second year and $225,000 for the third year. Mr. Wildes will receive
options to purchase 3,250,000 shares of common stock at $0.20 per share, vesting
1,625,000 as of October 1, 2004, vesting 812,500 as of September 30, 2005, and
vesting 812,500 as of September 30, 2006 (a significant portion of such grants
served as consideration for him agreeing to cancel benefits and protections set
forth in his prior employment agreement). He will also receive a $750 per month
automobile reimbursement, a performance-based bonus and bonus upon sale of the
Company and certain medical and other benefits. Mr. Wildes also received a
signing bonus of $75,000 in exchange for cancellation of the antidilution
protections set forth in his prior employment agreement. A copy of the
employment agreement is attached hereto as Exhibit 9.1.

KENNETH CRAIG

Kenneth Craig entered into a three (3) year employment agreement pursuant to
which he will receive an annual salary of $165,000 for the first year, $180,000
for the second year and $195,000 for the third year. Mr. Craig will receive
options to purchase 2,500,000 shares of common stock at $0.20 per share, vesting
1,250,000 as of October 1, 2004, vesting 625,000 as of September 30, 2005, and
vesting 625,000 as of September 30, 2006 (a significant portion of such grants
served as consideration for him agreeing to cancel benefits and protections set
forth in his prior employment agreement). Mr. Craig will also receive a $650 per
month automobile reimbursement, a performance-based bonus and bonus upon sale of
the Company and certain medical and other benefits. Mr. Craig also received a
signing bonus of $75,000 in exchange for cancellation of the antidilution
protections set forth in his prior employment agreement. A copy of the
employment agreement is attached hereto as Exhibit 9.2.

ERIK JENSEN

Erik Jensen entered into a two (2) year employment agreement pursuant to which
he will receive an annual salary of $125,000 for the first year and $145,000 for
the second year. Mr. Jensen will receive options to purchase 750,000 shares of
the common stock at $0.20 per share, vesting 250,000 as of October 1, 2004,
vesting 250,000 as of September 30, 2005, and vesting 250,000 as of September
30, 2006. Mr. Jensen will also receive a signing bonus of $15,000, a
performance-based bonus and a bonus upon sale of the Company and certain medical
and other benefits. If Mr. Jensen is terminated without cause, he will be paid
in full for all pay, benefits, overrides, commission, vacation pay, personal
days, bonus and stock or options. A copy of the employment agreement is attached
hereto as Exhibit 9.3.


                                       56


<PAGE>

JAMES F. SMITH III

James F. Smith III entered into a two (2) year employment agreement pursuant to
which he will receive an annual salary of $95,000 for the first year and
$102,000 for the second year. Mr. Smith will receive options to purchase 150,000
shares of the common stock at $0.20 per share, vesting 50,000 as of October 1,
2004, vesting 50,000 as of September 30, 2005, and vesting 50,000 as of
September 30, 2006. Mr. Smith will also a signing bonus of $10,000, a car
allowance of $400 per month, a bonus upon sale of the Company and certain
medical and other benefits. If Mr. Smith is terminated without cause, he will be
paid in full for all pay, benefits, overrides, commission, vacation pay,
personal days, bonus and stock or options. A copy of the employment agreement is
attached hereto as Exhibit 9.4. Mr. Smith resigned from the Company in January
2005. Mr. Smith resigned from the Company on January 3, 2005.

CONSULTING AGREEMENTS
---------------------

The Company has engaged several financial consultants to assist it in its
operations, since the date of its fiscal year end, under the following
agreements and terms:

CONSULTING AGREEMENT WITH SCOTT CHRISTIE

The Company entered into a Consulting Agreement with Scott Christie to advise
the Company on Financial business and investor matters. The Agreement is for a
term of two (2) years, it is terminable by either party on 30 days notice and
provides for the Company to pay Scott Christie a monthly fee of $4,000 and issue
500,000 nonqualified stock options to Mr. Christie exercisable at $0.20 per
share on a cashless basis, vesting 100,000 options immediately and 100,000 for
the following four quarters. A copy of the Consulting Agreement was attached to
the Company's Form 8-K dated December 12, 2004 and is incorporated herein by
this reference. Effective April 1, 2005, the consulting agreement with Mr.
Christie was terminated.

CONSULTING AGREEMENT WITH ANDREW NEITLICH

The Company entered into a Consulting Agreement with Andrew Neitlich to advise
the Company on Financial business and investor matters. The Agreement is for a
term of two (2) years, it is terminable by either party on 30 days notice and
provides for the Company to pay Andrew Neitlich a monthly fee of $2,000 and
issue 240,000 nonqualified stock options to Mr. Neitlich exercisable at $0.20
per share on a cashless basis, vesting 40,000 options immediately and 40,000 for
the following four quarters. A copy of the Consulting Agreement was attached to
the Company's Form 8-K dated December 12, 2004 and is incorporated herein by
this reference. Mr. Neitlich resigned from the Company on March 2005.

CONSULTING AGREEMENT WITH CASCADE PARTNERS

The Company entered into a Consulting Agreement with Cascade Partners
("Cascade") pursuant to which Cascade will provide advisory services to the
Company. Cascade will receive $8,000 per month plus options to purchase
1,200,000 shares of the Company's common stock for $0.20 per share on a cashless
basis. The Company's CEO, Clifford Wildes, is a former business partner of two
of Cascade's principles and one of Cascade's principals has and continues to
provide legal services to or on behalf of Mr. Wildes and the Company's CFO,
Kenneth Craig. A copy of the Consulting Agreement is attached hereto as Exhibit
9.5.


                                       57


<PAGE>

JAMES CHRISTIANSEN

Effective January 1, 2005, the Company entered into a one year consulting
agreement with James Christiansen to advise and assist the Company in developing
and implementing appropriate plans and security procedures for its ATM network
development. The Agreement is terminable by either party on 30 days notice. As
consideration for various services to be rendered, the Company has agreed to pay
the consultant total monthly fees of (i) $10,000 for four months and (ii) $4,000
for the remaining eight months, and to issue 425,000 nonqualified stock options
to him, which allow him to purchase a like number of shares of the Company's
common stock for $1.00 per share. The options are exercisable over the next year
and may be exercised on a cashless basis. A copy of this consulting agreement is
attached as Exhibit 5.1 to the Company's 10-QSB for the period ended March 31,
2005.

DENNARD RUPP GRAY & EASTERLY, LLC

On March 17, the Company entered into a consulting agreement with Dennard Rupp
Gray & Easterly, LLC ("DRG&E") for DRG&E to provide investor relations services
and advice to the Company for a monthly fee. The Company's contract at DRG&E is
Kenneth Dennard. Neither DRG&E nor its principals received any stock or
additional compensation for their services. A copy of this consulting agreement
is attached as Exhibit 5.3 to the Company's 10-QSB for the period ended March
31, 2005.

COMMITTEES OF THE BOARD OF DIRECTORS
------------------------------------

The Company presently has an audit committee and compensation committee of its
board of directors, each of which are controlled by a majority of outside
directors.

AUDIT COMMITTEE FINANCIAL EXPERT
--------------------------------

The Company's Audit Committee consists of two practicing accounting
professionals.

PAST RELATIONSHIPS AMONG OFFICERS, DIRECTORS AND CONSULTANTS
------------------------------------------------------------

The inside directors, the executive officers and certain consultants have
advised the Company's Board of Directors of certain existing and past business
relationships among the parties. Cliff Wildes was formerly in partnership with
the two principal partners of Cascade Partners. Cascade Partners is now a
consultant to the Company. Prior to the Company engaging Cascade Partners as a
consultant, one of Cascade Partners principal partners represented Cliff Wildes
and Ken Craig in the negotiation of their employment agreements with the
Company, and he is also indebted to Clifford Wildes for certain loans that Mr.
Wildes extended to him in 2000. One of the Cascade partners has represented Mr.
Wildes as personal legal counsel since 2000. Additionally, certain members of
the audit committee and Board of Directors have acted as accountants or tax
advisors to certain other officers and directors of the Company. The Board of


                                       58


<PAGE>

Directors of the Company has been advised of the details of these relationships.
Cliff Wildes and Rod Briado have been involved in a business relationship/ in
business with Meridian Capital Inc. Attorney Gary Glassman has represented Cliff
Wildes and one of his companies in the past; Attorney Glassman has also
represented one of Cascade Partners in the past.

Cliff Wildes, Ken Craig and Erik Jensen formed West Coast Construction
Management, LLC, to acquire Kesselring Construction a building restoration and
painting company in Florida, in which Mr. Wildes is a member and Mr. Jensen is a
managing member. Mr. Jensen has since resigned from being a member in the LLC.

Ben Bond was past accountant for Nova Interactive Inc., Barclay Partners Inc.
and Meridian Capital Inc. Erik Jensen's wife, who is an attorney, previously
worked for a firm that did legal work for Mr. Wildes personally and for his
companies, including Morgan Beaumont. Mr. Jensen's wife worked with the firm
that was Key Card Communication's corporate attorneys. Erik Jensen and James
Smith were previously in business together and the shareholders of Typhoon Voice
Technology. VL "Brother" Sandifer had filed the Company's past tax returns and
has been associated with Ken Craig and his family for years and has filed Mr.
Craig's taxes. The Board of Directors of the Company has been advised of the
details of these relationships.


Cliff Wildes was an investor in Key Card Communications and a director of Key
Card Communications for approximately 4 months in 2001 and then became a vice
president of its successor after it merged with a non-trading reporting company,
until he finally resigned in December 2001. There he met Michael Rejbeni, and
others who were involved in the initial operations of Key Card. Mr. Wildes also
introduced Key Card to his professional relationships. Benjamin Bond agreed to
act as a consultant on accounting matters, Rod Braido agreed to act as member of
the board of directors of Key Card and Attorney Gary Glassman agreed to act as
one of its corporate attorneys. Mr. Wildes also introduced Key Card to several
law firms that presently represent the Company. Mr. Wildes resigned from Key
Card's Board of Directors in June 2001 after learning in a board meeting that
Key Card had not paid its payroll taxes as they came due. Mr. Wildes remained as
a consultant to Key Card and a vice president of its successor until December
2001, to assist in the completion of the merger. The merger was completed;
however, Key Card's shares were never listed or traded. Mr. Braido also resigned
in December 2001 to join the Company as its CEO. Key Card discontinued
operations in approximately July 2002, shortly after Key Card's attorneys
reported to its board that they believed that Key Card's founder and President,
who is now deceased, had misappropriated substantial amounts of cash from Key
Card. There was no known evidence to the auditors or others that anyone else was
involved in the embezzlement of Key Card's funds. Mr. Wildes filed suit against
Key Card in 2002 and received a judgment against the company. Mr. Wildes
believed that although Key Card's founder had cheated and fooled him, a number
of professional services and local investors, that Key Card did employ a number
of goods and intelligent people who were familiar with the telecom industry. As
the Company developed, Mr. Wildes sought out their expertise to assist him in
growing the Company.



                                       59


<PAGE>

CODE OF ETHICS
--------------

The Company has not yet adopted a corporate code of ethics. The Company's board
of directors is considering, over the next year, establishing a code of ethics
to deter wrongdoing and promote honest and ethical conduct; provide full, fair,
accurate, timely and understandable disclosure in public reports; comply with
applicable laws; ensure prompt internal reporting of code violations; and
provide accountability for adherence to the code.

COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT

Section 16(a) of the Exchange Act requires the Company's executive officers and
directors, and persons who own more than 10% of a registered class of its equity
securities ("Reporting Persons"), to file reports of ownership and changes in
ownership with the SEC. Reporting Persons are required by SEC regulations to
furnish the Company with copies of all forms they file pursuant to Section
16(a). Based solely on the Company's review of the copies of such reports
received by it, the representations in the Merger Agreement between the former
Morgan Beaumont and Pan American Energy Corporation, and the written
representations from certain Reporting Persons that no other reports were
required for those persons, the Company believes that, during the nine months
ended September 30, 2004, the Reporting Persons complied with all Section 16(a)
filing requirements applicable to them.

The Company has become aware of a shareholder in possession at one point of
approximately 9,060,000 shares of the 40,000,000 of the Company's total shares
outstanding. This represents 22.6 % of the Company's total share outstanding
shares, thus exceeding 10% of the then outstanding number of shares. The Company
contacted the shareholder and informed him of his obligations under Section 16
of the Exchange Act. The Shareholder failed to respond to the Company's
inquiries and subsequently informed the Company that he did not control over 5%
of the Company's shares. The Company is continuing to investigate the
shareholder's response and at the suggestion of the SEC, the Company will file
an unverified Form 3 on behalf of the shareholder.

EXECUTIVE COMPENSATION

SUMMARY COMPENSATION TABLE

The table below summarizes all compensation awarded to, earned by, or paid to
the following individuals, the Company's "named executive officers and
directors" for the two most recently completed fiscal years ended December 31,
2003 and September 30, 2004. This table does not reflect changes that went into
effect after the end of the Company's fiscal year.


                                       60
<PAGE>
<TABLE>
                                                      ANNUAL COMPENSATION                     LONG TERM COMPENSATION
                                           ------------------------------------------   ---------------------------------
                                                                                        RESTRICTED
                                                                        OTHER ANNUAL       STOCK         OPTIONS/* SARS
NAME                      TITLE             YEAR    SALARY      BONUS   COMPENSATION      AWARDED              (#)
-------------------------------------------------------------------------------------------------------------------------
<S>                       <C>               <C>     <C>           <C>    <C>            <C>                     <C>
Clifford Wildes (1) (3)   Chief             2004    $150,000      -        $5,941            -                  -
                          Executive         2003    $150,000      -        $9,350            -
                          Officer,          2002    $100,000      -        $8,410            -
                          Treasure and
                          Director
-------------------------------------------------------------------------------------------------------------------------
Erik Jensen (1) (3)       President,        2004     $96,000      -        $4,800       12,737 shares           -
                          Chief             2003           -      -             -            -                  -
                          Operating         2002           -      -             -            -
                          Officer, and
                          Director
-------------------------------------------------------------------------------------------------------------------------
Kenneth Craig (1) (3)     Chief             2004    $150,000      -       $12,593            -                  -
                          Financial         2003    $150,000      -       $18,860            -                  -
                          Officer,          2002    $100,000      -       $11,565            -                  -
                          Secretary, and
                          Director
-------------------------------------------------------------------------------------------------------------------------
James Smith III           Chief             2004     $78,000      -        $4,800       12,737 shares           -
                          Technical         2003           -      -             -            -                  -
                          Officer           2002           -      -             -            -                  -
                                                     $90,000
-------------------------------------------------------------------------------------------------------------------------
Rod Braido (1)            Senior            2004           -      -        $3,000            -                  -
                          Vice-President,   2003           -      -             -            -                  -
                          Director          2002           -      -             -            -                  -
-------------------------------------------------------------------------------------------------------------------------
Virgil "Brother"          Audit             2004      $5,000      -        $1,000            -                  -
Sandifer, Jr. (1) (2)     Committee         2003           -      -          $250            -                  -
                          Member,           2002           -      -             -            -                  -
                          Compensation
                          Committee
                          Member, and
                          Director
-------------------------------------------------------------------------------------------------------------------------
Benjamin J. Bond (1) (2)  Audit             2004      $5,000      -        $1,000            -                  -
                          Committee         2003           -      -          $250            -                  -
                          Member,           2002           -      -             -            -                  -
                          Compensation
                          Committee
                          Member, and
                          Director
-------------------------------------------------------------------------------------------------------------------------
Mark Brewer (1) (2)       Director;         2004       $5000                $1000                               -
                          Audit             2003       $5000      -          $250
                          Committee;
                          Compensation
                          Committee
                                            2004    $579,000      0       $34,134       25,474 shares           -
-------------------------------------------------------------------------------------------------------------------------


                                                            61
</TABLE>


<PAGE>

(1)  Outside Directors receive $5,000 per year to serve on the Board, plus an
     additional $1,000 if they attend the annual meeting of the Company's
     Shareholders. They also receive 100,000 options, which vest 20,000 upon
     grant and the remaining vesting 20,000 per quarter. Employee Directors
     receive 100,000 options, which vest 20,000 upon grant and the remaining
     vesting 20,000 per quarter.
(2)  Also a Committee Member. Committee members receive an additional $250 for
     each Committee Meeting they attend.
(3)  The executive officers entered into new employment agreements with the
     Company effective after the period covered in this report. A description of
     the terms and copies of the agreements are set forth in this report.

STOCK OPTION GRANTS

The Company did not grant any stock options to the executive officers or
directors during the period ended September 30, 2004. Officers and directors
were granted nonqualified options as set forth in the description of their
employment agreements.

EXERCISES OF STOCK OPTIONS AND YEAR-END OPTION VALUES

No stock options were exercised by the Company's officers, directors or
employees during the period ended September 30, 2004. As of the date of this
report, no options had been exercised.

OUTSTANDING STOCK OPTIONS

As of September 30, 2004 there are no stock options outstanding.

SUBSEQUENT ISSUANCE OF STOCK OPTIONS

The Company did not issue any options to purchase any of its shares in the year
ended September 30, 2004, but did issue options shortly thereafter. As of June
30, 2005, the Company had a total of 11,996,667 outstanding options to purchase
common stock at a weighted average exercise price of $0.488 per share, of which
5,946,668 options are vested and immediately exercisable at a weighted average
exercise price of $0.642 per share. The options vested one third upon grant, one
third upon the first anniversary of the grant and one third on the second
anniversary of the grant.

The Company issued a total of 11,540,000 options to employees, consultants,
directors and officers in the quarter ended December 31, 2004, at a weighted
average exercise price of $0.428. In the quarter ended March 31, 2005, the
Company issued an additional 1,170,000 options at a weighted average exercise
price of $0.968 per share. In the quarter ended June 30, 2005 the Company issued
an additional 640,000 options at a weighted average exercise price of $0.579 per
share. The Company has described the majority of the grants in the reports it
has filed disclosing employment agreements with key personnel. The Company will
provide a detailed discussion of the option program and grants in its annual
report filed on Form 10-KSB for the year ending September 30, 2005.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT


The following table sets forth as of September 30, 2004, and updates as of June
30, 2005, the number and percentage of the outstanding shares of common stock
which, according to the information supplied to the Company, were beneficially
owned by (i) each person who is currently a director of the Company, (ii) each
executive officer, (iii) all current directors and executive officers of the
Company as a group and (iv) each person who, to the knowledge of the Company is
the beneficial owner of more than 5% of the outstanding common stock. Except as



                                       62


<PAGE>

otherwise indicated, the persons named in the table have sole voting and
dispositive power with respect to all shares beneficially owned, subject to
community property laws where applicable. This table does not reflect options
granted to the Company's executive officers after the period covered in this
report, which are listed in the description of their employment agreements.

<TABLE>
                                                               Amount of                              Percent
                                                               beneficial ownership                   of class
Title of class      Name and address                           As of 9/30/04 and                      As of 9/30/04 and
class(1)            of beneficial owner                        As of 6/30/05                          As of 6/30/05
-----------------------------------------------------------------------------------------------------------------------
<S>                 <C>                                        <C>                                      <C>
Common Stock        Clifford Wildes                            4,090,789 shares(2)                        10.2%
                    7436 Myrica Drive                          7,440,789 shares(2)                        12.3%
                    Sarasota, FL  34241

Common Stock        Carole L. Wildes                           4,090,789 shares(3)                        10.2%
                    7436 Myrica Drive                          7,440,789 shares(3)                        12.3%
                    Sarasota, FL  34241

Common Stock        Kenneth Craig                              2,923,210 shares(4)                         7.3%
                    612 Downs Avenue                           5,673,210 shares(4) (7)                     9.4%
                    Tampa, FL  33617

Common Stock        Rosie Craig                                2,923,210 shares(5)                         7.3%
                    612 Downs Avenue                           5,673,210 shares(5) (7)                     9.4%
                    Tampa, FL  33617

Common Stock        Erik Jensen                                773,757 shares                              1.9%
                    5105 Sunnydale Circle                      1,623,757 shares (6)                        2.7%
                    Sarasota, FL  34233

Common Stock        James Smith III                            855,599 shares                              2.1%
                    9903 Old Hyde Park Pl                      905,559 shares (7)                          1.5%
                    Bradenton, FL  34202

Common Stock        Rod Braido                                 703,450 shares (6)                          1.8%
                    1 Golden Meadow Lane                       853,450 shares (6)                          1.41
                    Fallbrook, CA  92028

Common Stock        Virgil "Brother" Sandifer, Jr.             No shares                                    .0%
                    2037 Hwy 82 E.                             100,000 shares related to Options           0.2%
                    Greenville, MS 38703

Common Stock        Benjamin J. Bond                           No shares                                    .0%
                    1001 N. Washington Blvd., Suite 106        100,000 shares related to Options           0.2%
                    Sarasota, Florida 34236

Common Stock        Mark Brewer                                No shares                                    .0%
                    12577 South 265 West                       100,000 shares related to Options           0.2%
                    Draper, UT 84020

Common Stock        Theodore Misiewicz                         No shares                                    .0%
                    3688 Quiet Pond Ln.                        600,000 shares related to Options           1.0%
                    Sarasota, FL  34235

Common Stock        All Officers and Directors                 9,346,805 shares                           25.2%
                    as a Group that consists of                15,587,756 shares                          28.8%
                    three people
</TABLE>


                                       63


<PAGE>




(1)  The percent of class is based on 40,025,017 shares of common stock issued
     and outstanding as of September 30, 2004 and 60,376,153, as of July 31,
     2005.

(2)  Of the shares represented as of September 30, 2004 of 3,993,989 are in the
     name of Cliff Wildes and 96,800 shares are in the name of his wife, Carole
     L. Wildes, of which he is deemed to be the beneficial owner. Shares
     represented as of June 30, 2004, include, 3,993,989 are in the name of
     Cliff Wildes, 96,800 shares are in the name of his wife, Carole L. Wildes,
     of which he is deemed to be the beneficial owner, and 3,350,000 shares
     related the options granted Mr. Wildes.

(3)  Of the shares represented as of September 30, 2004 of 96,800 are in the
     name of Carole L. Wildes and 3,993,989 shares are in the name of her
     husband, Cliff Wildes, of which she is deemed to be the beneficial owner.
     Shares represented as of June 30, 2004, include, 96,800 are in the name of
     Carole L. Wildes, 3,993,989 shares are in the name of her husband, Cliff
     Wildes, of which she is deemed to be the beneficial owner, and 3,350,000
     shares related the options granted Mr. Wildes.

(4)  Shares represented as of September 30, 2004 of 1,932,928 are in the name of
     Ken Craig, 990,282 shares are in the name of his wife, Rosie Craig. Shares
     represented as of June 30, 2004 include 1,932,928 are in the name of Ken
     Craig, 990,282 shares are in the name of his wife, Rosie Craig, 2,600,000
     shares related to the options granted to Mr. Craig after September 30,
     2004, and 50,000 shares related to options granted to Rosie Craig.

(5)  Of the shares represented, 990,282 are in the name of Rosie Craig and
     1,932,928 shares are in the name of her husband, Kenneth Craig, of which
     she is deemed to be the beneficial owner. . Shares represented as of June
     30, 2004 include 990,282 are in the name of Rosie Craig and 1,932,928
     shares are in the name of her husband, Kenneth Craig, of which she is
     deemed to be the beneficial owner, 50,000 shares related to options granted
     to Rosie Craig, and 2,600,000 shares related to the options granted to Mr.
     Craig after September 30, 2004.

(6)  Of the shares represented as of September 30, 2004 all 773,757 in the name
     of Erik Jensen. Shares represented as of June 30, 2004, include, 773,757 in
     shares and 850,000 shares related the options granted Mr. Jensen.

(7)  No longer with the Company as of the date of the amendment of this 10-KSB.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

There have been two transactions by the Company within the last two years where
a director, officer or shareholder of the Company, had a direct or indirect
interest.


                                       64


<PAGE>

     o    Erik Jensen, current President and COO, was an officer and director of
          Typhoon Voice Technologies in 2003. Typhoon had contracts with the
          Company for the development of the Morgan Beaumont Network and
          database. The Company has since acquired Typhoon and all assets
          thereof.
     o    At December 31, 2003, the Company had a $36,500 note payable to Cliff
          Wildes. The note, which required interest at the rate of 12% per
          annum, was paid during the nine months ended September 30, 2004.

EXHIBITS AND REPORTS ON FORM 8-K

(a) Reports on Form 8-K:

(b) Exhibits:

Exhibits included or incorporated by reference herein are set forth in the
Exhibit Index.

PRINCIPAL ACCOUNTANT FEES AND SERVICES

AUDIT FEES
----------

The aggregate fees billed for the nine months ended September 30, 2004 for
professional services rendered by the principal accountant for the audit of the
Company's annual financial statements and review of the financial statements
included in the Company's Form 10-KSB or services that are normally provided by
the accountant in connection with statutory and regulatory filings or
engagements for these fiscal periods were estimated at $35,000.

AUDIT RELATED FEES
------------------

None.

TAX FEES
--------

None.

ALL OTHER FEES
--------------

None.


                                       65


<PAGE>

                                   SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act, the Company caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

MORGAN BEAUMONT

By:   /S/CLIFFORD WILDES
      --------------------------------
      Clifford Wildes, Chief Executive Officer, Treasurer
      Director
      Date: October 18, 2005

In accordance with the Securities Exchange Act, this report has been signed
below by the following persons on behalf of the registrant and in the capacities
and on the dates indicated.

By:   /S/CLIFFORD WILDES
      --------------------------------
      Clifford Wildes, Chief Executive Officer and Treasurer
      (Principal Executive Officer)
      Director
      Date: October 18, 2005

By:   /S/THEODORE MISIEWICZ
      --------------------------------
      Theodore Misiewicz, Secretary and Chief Financial Officer
      (Principal Financial Officer and Principal Accounting Officer)
      Director
      Date: October 18, 2005

                                 EXHIBITS INDEX

                 EXHIBITS REQUIRED BY ITEM 601 OF REGULATION S-B

        EXHIBIT
        NUMBER      DESCRIPTION OF EXHIBIT

          3.1       Articles of Incorporation (1)

          3.2       Bylaws (1)

          4.1       Share Certificate (1)

          7.1       Consent of Independent Registered Public Accounting Firm (1)

          9.1       Employment Agreement with Clifford Wildes (1)


                                       66


<PAGE>

          9.2       Employment Agreement with Kenneth Craig (1)

          9.3       Employment Agreement with Erik Jensen (1)

          9.4       Employment Agreement with James Smith III (1)

          9.5       Consulting Agreement with Cascade Partners (1)

          19.1      Definitive Information on Schedule 14C (1)

          31.a      Certification of Chief Executive Officer pursuant to Section
                    302 of the Sarbanes-Oxley Act of 2002 (2)

          31.b      Certification of Chief Financial Officer pursuant to Section
                    302 of the Sarbanes-Oxley Act of 2002 (2)

          32.a      Certification of Chief Executive Officer pursuant to 18
                    U.S.C. Section 1350, as adopted pursuant to Section 906 of
                    the Sarbanes-Oxley Act of 2002 (2)

          32.b      Certification of Chief Financial Officer pursuant to 18
                    U.S.C. Section 1350, as adopted pursuant to Section 906 of
                    the Sarbanes-Oxley Act of 2002 (2)

     (1) Filed as an Exhibit to the Form 10-KSB filed with the Securities and
     Exchange Commission on February 8, 2005.
     (2) Filed as an Exhibit to this Quarterly Report on Form 10-KSB.


REPORTS ON FORM 8-K
-------------------

On September 1, 2004, the Company filed a Report on Form 8-K announcing under
Item 1 of that report changes in control of Registrant, under Item 2 of that
report the acquisition or distribution of assets, under Item 5 of that report
other events, and under 6 of that report the resignation of directors, as more
particularly described elsewhere in this Form 10-KSB.

On October 4, 2004, the Company filed a Report on Form 8-K announcing under Item
1.01 of that report the entry into a definitive agreement, under Item 2.01 of
that report the acquisition or distribution of assets, under Item 4.01 of that
report the changes in the Company's certifying accountant, under Item 5.01 of
that report the changes in control of Registrant, under 5.02 of that report the
resignation of directors, under Item 5.03 of that report the change in fiscal
year, under Item 8.01 of that report other events, and under Item 9.01 the
Financial Statements of the Company, as more particularly described elsewhere in
this Form 10-KSB.


                                       67


<PAGE>

On October 12, 2004, the Company filed a Report on Form 8-K announcing under
Item 1.01 of that report note payment and under Item 8.01 of that report other
events, as more particularly described elsewhere in this Form 10-KSB.

On October 27, 2004, the Company filed a Report on Form 8-K announcing under
Item 3.01 of that report unauthorized listing and trading of securities, under
Item 3.03 of that report the stop transfer, under Item 5.02 of that report the
additions to the Board of Directors and formation of compensation and audit
committees, and under Item 8.01 of that report other events, as more
particularly described elsewhere in this Form 10-KSB.

On December 7, 2004, the Company filed a Report on Form 8-K announcing under
1.02 of that report the amendment of note agreement with Paul Marshall, under
Item 5.02 of that report the additions to the Company's Board of Directors,
under Item 7.01 of that report the consummation of common stock private
placement and under Item. 8.01 the renegotiation of employment contracts with
Cliff Wildes and Kenneth Craig, the Consulting Agreement with Scott Christie and
Andrew Neitlich and a partial settlement on the First National Bank of Central
Texas case.

On January 27, 2005, the Company filed a Report on form 8-K announcing under
5.02 of that report the hiring and resignation of employees and under 8.01 the
loan to eChex.

On January 31, 2005, the Company filed a Report on form 8-K announcing under
1.02 of that report the 5.02 the hiring and resignation of employees and other
new hires and under 8.01 New Office Lease for Headquarters for Computer Hardware
and Software development and the agreement with Acosta.

On February 1, 2005, the Company filed a Report on form 8-K announcing under
8.01 of that report the agreement with Acosta and eChex and the formation of a
new subsidiary.

On February 14, 2005, the Company filed a Report on form 8-K announcing under
7.01 of that report the filing of a S-2 registration statement.

On April 27, 2005, the Company filed a Report on form 8-K announcing under 8.01
of that report the acquisition of certain assets of MTel Communications.

On May 3, 2005, the Company filed a Report on form 8-K announcing under 8.01 of
that report the agreement with and loan to eChex.

On May 20, 2005, the Company filed a Report on form 8-K announcing under 8.01 of
that report the Letter of Intent to acquire Financial Services International and
the completion of the purchase of the certain assets from MTel.

On June 6, 2005, the Company filed a Report on form 8-K announcing under 8.01 of
that report the agreement with Virtual Card Services.

On June 21, 2005, the Company filed a Report on form 8-K announcing under 8.01
of that report the agreement with Network Management Inc.


                                       68


<PAGE>

On June 24, 2005, the Company filed a Report on form 8-K announcing under 8 of
that report the agreement with Western Union.

On July 7, 2005, the Company filed a Report on form 8-K announcing under 8 of
that report the Distribution Agreement with CGS Financial Technologies, the
cancellation of the acquisition of Financial Services International and the
resignation of Rod Braido.

On July 22, 2005, the Company filed a Report on form 8-K announcing under 7.01
of that report the consummation of a common stock private placement

On September 7, 2005, the Company filed a Report on form 8-K announcing under
5.02 of that report the resignation of the Chief Operating Officer and
appointment of new secretary and under 8 of that report the agreement with
Symmetrex.

On September 12, 2005, the Company filed a Report on form 8-K announcing under 8
of that report the agreement with Aliant Financial Services and the delays in
Merrick Bank performance.



                                       69


<PAGE>

ITEM 7. FINANCIAL STATEMENTS




                              MORGAN BEAUMONT, INC.
                        (A DEVELOPMENT STAGE ENTERPRISE)

                         FINANCIAL STATEMENTS AS OF AND
                               FOR VARIOUS PERIODS
                            ENDED SEPTEMBER 30, 2004,
                             AND FOR THE YEAR ENDED
                                DECEMBER 31, 2003
                            AND REPORT OF INDEPENDENT
                        REGISTERED PUBLIC ACCOUNTING FIRM





                                      F-1


<PAGE>

                              MORGAN BEAUMONT, INC.
                        (A DEVELOPMENT STAGE ENTERPRISE)

                                TABLE OF CONTENTS
                                -----------------


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

                                                                            Page
                                                                            ----

Report of Independent Registered Public Accounting Firm...................  F-3

Financial Statements as of and for various periods ended
   September 30, 2004, and for the year ended December 31, 2003:
     Balance Sheet........................................................  F-4

     Statements of Operations.............................................  F-5
     Statements of Stockholders' Equity (Deficit).........................  F-6

     Statements of Cash Flows.............................................  F-8

     Notes to Financial Statements........................................ F-10

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


                                      F-2


<PAGE>

                     [LETTERHEAD OF KINGERY & CROUSE, P.A.]




REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of Morgan Beaumont, Inc.:

We have audited the accompanying balance sheet of Morgan Beaumont, Inc. (the
"Company"), a development stage enterprise, as of September 30, 2004, and the
related statements of operations, stockholders' equity (deficit) and cash flows
for the nine months then ended, the year ended December 31, 2003 and the period
July 10, 2000 (date of incorporation) to September 30, 2004. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

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

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of the Company as of September 30,
2004, and the results of its operations and its cash flows for the nine months
then ended, the year ended December 31, 2003 and the period July 10, 2000 (date
of incorporation) to September 30, 2004, in conformity with accounting
principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Notes A and B to the
financial statements, the Company is in the development stage, has suffered
recurring losses from operations and will have ongoing requirements for
additional capital investment. These factors raise substantial doubt about the
Company's ability to continue as a going concern. Management's plans in regard
to these matters are also described in Note B. The financial statements do not
include any adjustments that might result from the outcome of this uncertainty.



/S/ KINGERY & CROUSE, P.A.

TAMPA, FLORIDA
NOVEMBER 26, 2004


           2801 WEST BUSCH BOULEVARD, SUITE 200, TAMPA, FLORIDA 33618
           PHONE: 813.874.1280 | FAX: 813.874.1292 | WWW.TAMPACPA.COM


                                      F-3


<PAGE>

                              MORGAN BEAUMONT, INC.
                        (A DEVELOPMENT STAGE ENTERPRISE)

                     BALANCE SHEET AS OF SEPTEMBER 30, 2004


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

ASSETS
------

CURRENT ASSETS:
Cash and cash equivalents                                       $     121,832
Note receivable from stockholder                                      644,535
Other receivables                                                       5,865
Prepaid expenses and other current assets                               5,868
                                                                -------------
          Total current assets                                        778,100

PROPERTY AND EQUIPMENT - NET                                          102,559

OTHER ASSETS                                                           39,375
                                                                -------------

TOTAL                                                           $     920,034
                                                                =============


LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------

CURRENT LIABILITIES:
Accounts payable and accrued liabilities                        $     394,846
Notes payable                                                          50,000
                                                                -------------
           Total current liabilities                                  444,846
                                                                -------------

STOCKHOLDERS' EQUITY:
  Common stock - $0.001 par value: 170,000,000 shares
     authorized; 40,025,017 shares issued and outstanding              40,025
  Additional paid-in capital                                        4,474,514
  Note receivable from stockholder                                 (1,384,414)
  Deficit accumulated during the development stage                 (2,654,937)
                                                                -------------
          Total stockholders' equity                                  475,188
                                                                -------------
  TOTAL                                                         $     920,034
                                                                =============

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

See notes to financial statements.


                                      F-4


<PAGE>

<TABLE>
                                              MORGAN BEAUMONT, INC.
                                         (A DEVELOPMENT STAGE ENTERPRISE)

                                             STATEMENTS OF OPERATIONS

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

                                                                                                  For the period
                                                         For the nine                              July 10, 2000
                                                            months            For the year           (date of
                                                             ended               ended           incorporation) to
                                                         September 30,        December 31,         September 30,
                                                             2004                 2003                 2004
                                                        --------------       --------------       --------------
<S>                                                     <C>                  <C>                  <C>
REVENUES (net of returns and allowances)                $       58,602       $      355,872       $      590,219

COST OF REVENUES                                                35,833              186,245              316,162
                                                        --------------       --------------       --------------

GROSS PROFIT                                                    22,769              169,627              274,057
                                                        --------------       --------------       --------------

OTHER OPERATING EXPENSES:
Stock based compensation and consulting                         14,200              594,465            1,012,286
Other employee compensation and benefits                       624,972              248,430            1,075,115
Other professional and consulting fees                         141,116               15,796              183,695
Purchased in-process research and development                       --              153,190              153,190
Impairment of long lived assets                                 43,154                   --               43,154
Occupancy and equipment                                         88,951               63,292              185,075
Selling and marketing                                           28,301               27,274               95,581
Travel and entertainment                                        24,073                4,020               28,093
Other                                                           64,358               12,286              120,278
                                                        --------------       --------------       --------------
                                                             1,029,125            1,118,753            2,896,467
   Total other operating expenses
                                                        --------------       --------------       --------------

LOSS FROM OPERATIONS                                        (1,006,356)            (949,126)          (2,622,410)
                                                        --------------       --------------       --------------

OTHER INCOME (EXPENSE):
Loss from litigation                                           (56,000)                  --              (56,000)
Interest income                                                 36,211                   --               36,211
Interest expense                                                (5,190)              (5,848)             (12,738)
                                                        --------------       --------------       --------------
    Total other income (expense)                               (24,979)              (5,848)             (32,527)
                                                        --------------       --------------       --------------

NET LOSS                                                $   (1,031,335)      $     (954,974)      $   (2,654,937)
                                                        ==============       ==============       ==============

NET LOSS PER SHARE - Basic and diluted                  $         (.08)      $         (.13)
                                                        ==============       ==============

Weighted average number of shares outstanding               12,697,400            7,216,359
                                                        ==============       ==============

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

See notes to financial statements.


                                                       F-5
</TABLE>


<PAGE>

<TABLE>
                                                        MORGAN BEAUMONT, INC.
                                                  (A DEVELOPMENT STAGE ENTERPRISE)

                                            STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)


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

                                                                                                           Deficit
                                                                                             Note        Accumulated
                                      Common Stock           Additional      Common        Receivable     During the
                                -------------------------     Paid-In         Stock          from        Development
                                   Shares      Par Value      Capital      Subscribed     Stockholder       Stage          Total
                                -----------   -----------   -----------    -----------    -----------    -----------    -----------
<S>                             <C>           <C>           <C>            <C>            <C>            <C>            <C>
Balances, July 10, 2000
  (date of incorporation)                 -   $         -   $         -    $         -    $         -    $         -    $         -

Common stock subscription                 -             -             -            100              -              -            100
Net loss                                  -             -             -              -              -              -              -
                                -----------   -----------   -----------    -----------    -----------    -----------    -----------
Balances, December 31, 2000               -             -             -            100              -              -            100

Issuance of common stock
  for cash:
     At $0.0069 per share            50,947            51           399           (100)             -              -            350
     At $0.0063 per share           796,047           796         4,204              -              -              -          5,000
Issuance of common stock
  for services -
     At $0.0785 per share         1,557,067         1,557       120,693              -              -              -        122,250
Net loss                                  -             -             -              -              -       (216,982)      (216,982)
                                -----------   -----------   -----------    -----------    -----------    -----------    -----------
Balances, December 31, 2001       2,404,061         2,404       125,296              -       (216,982)       (89,282)

Issuance of common stock
  for cash:
     At $0.0785 per share            26,747            27         2,073              -              -              -          2,100
     At $0.1309 per share         1,295,327         1,295       168,205              -              -              -        169,500
     At $0.157 per share            318,419           318        49,682              -              -              -         50,000
Issuance of common stock
  for services:
     At $0.0785 per share           928,254           928        71,952              -              -              -         72,880
     At $0.13111 per share        1,509,304         1,509       196,382              -              -              -        197,891
     At $0.157 per share             67,505            68        10,532              -              -              -         10,600
Net loss                                  -             -             -              -              -       (451,646)      (451,646)
                                -----------   -----------   -----------    -----------    -----------    -----------    -----------
Balances, December 31, 2002       6,549,617         6,549       624,122              -              -       (668,628)       (37,957)

Issuance of common stock
  for cash:
     At $0.0785 per share           284,195           284        22,029              -              -              -         22,313
     At $0.157 per share            254,735           255        39,745              -              -              -         40,000
Issuance of common stock
  for services:
     At $0.157 per share          3,785,774         3,786       590,679              -              -              -        594,465


                                                                                                                         (CONTINUED)

                                                                F-6


<PAGE>

                                                        MORGAN BEAUMONT, INC.
                                                  (A DEVELOPMENT STAGE ENTERPRISE)

                                            STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
                                            --------------------------------------------


                                                                                                           Deficit
                                                                                             Note        Accumulated
                                      Common Stock           Additional      Common        Receivable     During the
                                -------------------------     Paid-In         Stock          from        Development
                                   Shares      Par Value      Capital      Subscribed     Stockholder       Stage          Total
                                -----------   -----------   -----------    -----------    -----------    -----------    -----------
Issuance of common stock
  for assets of Typhoon
  Technologies at $0.157
  per share                       1,421,357         1,421       221,769              -              -              -        223,190
Net loss                                  -             -             -              -              -       (954,974)      (954,974)
                                -----------   -----------   -----------    -----------    -----------    -----------    -----------
Balances, December 31, 2003      12,295,678        12,295     1,498,344              -              -     (1,623,602)      (112,963)

Issuance of common stock for
  cash ($.0785 per share)           263,651           264        20,436              -              -              -         20,700
Issuance of common stock held
  in escrow                         350,260           350          (350)                                                          -
Issuance of common stock for
  services at $0.157 per share       90,428            91        14,109              -              -              -         14,200
Issuance of common stock in
  exchange for net assets in a
  recapitalization               27,025,000        27,025     2,941,975              -     (3,000,000)             -        (31,000)
Collections on note receivable
  from stockholder through
  September 30, 2004                      -             -             -              -        971,051              -        971,051
Collections on note receivable
  from stockholder after
  September 30, 2004 (reflected
  as a current asset)                     -             -             -              -        644,535              -        644,535
Net loss                                  -             -             -              -              -     (1,031,335)    (1,031,335)
                                -----------   -----------   -----------    -----------    -----------    -----------    -----------

Balances, September 30, 2004     40,025,017   $    40,025   $ 4,474,514    $         -    $(1,384,414)   $(2,654,937)   $   475,188
                                ===========   ===========   ===========    ===========    ===========    ===========    ===========

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

See notes to financial statements.


                                                                F-7
</TABLE>


<PAGE>

<TABLE>
                                                        MORGAN BEAUMONT, INC.
                                                  (A DEVELOPMENT STAGE ENTERPRISE)

                                                      STATEMENTS OF CASH FLOWS

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

                                                                                                                     For the period
                                                                                                                      July 10, 2000
                                                                                                                        (date of
                                                                                   For the nine      For the year    incorporation)
                                                                                   months ended         ended              to
                                                                                   September 30,     December 31,    September 30,
                                                                                        2004             2003             2004
                                                                                   -------------    -------------    -------------
CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                                                <C>              <C>              <C>
    Net loss                                                                       $  (1,031,335)   $    (954,974)   $  (2,654,937)
    Adjustments to reconcile net loss to net cash used in operating activities:
       Depreciation and amortization                                                      28,688           24,375           62,050
       Amortization of intangible assets                                                   6,635                -            6,635
       Stock based compensation and consulting                                            14,200          594,465        1,012,286
       Purchased in-process research and development                                           -          153,190          153,190
       Impairment of long-lived assets                                                    43,154                -           43,154
    Changes in assets and liabilities, net:
        Decrease (increase)  in receivables                                               (5,865)          19,956           (5,865)
        Decrease (increase) in inventories                                                     -           19,632                -
        Decrease (increase) in prepaid expenses and other current assets                  27,432            2,500           (5,868)
        Decrease (increase) in other assets                                              (30,525)               -          (30,525)
        Increase (decrease) in accounts payable and accrued  liabilities                 137,637           42,997          363,847
                                                                                   -------------    -------------    -------------
NET CASH USED IN OPERATING ACTIVITIES                                                   (809,979)         (97,859)      (1,056,033)
                                                                                   -------------    -------------    -------------

CASH FLOWS FROM INVESTING ACTIVITIES:
     Purchases of property and equipment                                                 (45,551)         (12,141)        (148,249)
     Purchase of assets from Typhoon Voice Technologies, Inc.                                  -           (5,000)          (5,000)
                                                                                   -------------    -------------    -------------
 CASH USED IN INVESTING ACTIVITIES                                                       (45,551)         (17,141)        (153,249)
                                                                                   -------------    -------------    -------------

CASH FLOWS FROM FINANCING ACTIVITIES:
     Proceeds from borrowings under notes payable                                              -           53,912           97,912
     Repayments of notes payable                                                         (36,500)          (1,200)         (47,912)
     Proceeds from the issuance of common stock                                           20,700           62,313          310,063
     Collections on note receivable from stockholder                                     971,051                -          971,051
                                                                                   -------------    -------------    -------------
NET CASH PROVIDED BY FINANCING ACTIVITIES                                                955,251          115,025        1,331,114
                                                                                   -------------    -------------    -------------

NET INCREASE IN CASH AND CASH EQUIVALENTS                                                 99,721               25          121,832

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD                                            22,111           22,086                -
                                                                                   -------------    -------------    -------------

CASH AND CASH EQUIVALENTS, END OF PERIOD                                           $     121,832    $      22,111    $     121,832
                                                                                   =============    =============    =============

SUPPLEMENTAL DISCLOSURE OF CASH FLOW  INFORMATION:
Interest paid                                                                      $       3,031    $         200    $       3,231
                                                                                   =============    =============    =============
Income taxes paid                                                                  $           -    $           -    $           -
                                                                                   =============    =============    =============


                                                                F-8


<PAGE>


SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:

Acquisition of assets by issuance of stock - see Note E                            $           -    $      70,000    $      70,000
                                                                                   =============    =============    =============

Issuance of common stock for net assets of Pan American Energy Corporation
in a recapitalization  - see Note A                                                $   2,969,000    $           -    $   2,969,000
                                                                                   =============    =============    =============


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

See notes to financial statements.




                                                                F-9
</TABLE>


<PAGE>

                              MORGAN BEAUMONT, INC.
                        (A DEVELOPMENT STAGE ENTERPRISE)

                          NOTES TO FINANCIAL STATEMENTS

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

NOTE A - FORMATION, BACKGROUND AND OPERATIONS OF THE COMPANY

Morgan Beaumont, Inc., (the "Company"), which is headquartered in Sarasota,
Florida, was incorporated in 2000. Because the Company did not generate
significant revenues through September 30, 2004, it is considered to be in the
development stage as defined in Financial Accounting Standards Board Statement
No. 7.

The Company's primary products are debit cards and stored value cards which are
re-loadable financial products for the sub-prime credit market. The Company has
been providing these cards to consumers in the sub-prime credit market sector
since the third quarter of 2002. The sub-prime market is generally made up of
consumers that do not have checking accounts and/or the ability to obtain
standard debit or credit cards. The Company has also provided these products to
third party companies for co-branding with their company name and logo, and
marketing these products under its brand name (e.g. the stored value cards are
issued under the following certifications with MasterCard International -
Independent Sales Organization (ISO), Member Service Provider (MSP) and Third
Party Processor (TPP)). The Company also received the ISO certification with
VISA on September 29, 2004.

On August 24, 2004, the Company acquired the net assets of Pan American Energy
Corp, a publicly traded company ("PAEC") for 27,025,000 shares of its common
stock (which number of shares was subsequently reduced by 1,000,000 shares - see
Note J) and the assumption of $31,000 of accounts payable and accrued
liabilities. For financial statement purposes, the transaction was treated as a
reverse merger and a recapitalization whereby the Company was deemed to be the
acquirer, and no goodwill or other intangible assets were recorded.

In connection with this transaction, the Company received a $3,000,000 note
receivable from a PAEC stockholder. Through September 30, 2004, the Company had
received $971,051 under this note, and during the period October 1, 2004 to
November 26, 2004, the Company collected an additional $644,535. In accordance
with generally accepted accounting principles, the unpaid balance of the note as
of November 26, 2004 has been reflected as a deduction from stockholders'
equity, and the amount paid during the period October 1, 2004 to November 26,
2004 has been reflected as a current asset.

Immediately prior to the acquisition, the Company reduced its outstanding shares
via a reverse stock split whereby the Company's outstanding shares were reduced
at the rate of 7.8513 to one. All references to the number of shares in the
accompanying financial statements and notes thereto have been adjusted to
reflect the stock split as though it occurred at the date of the Company's
incorporation. A summary of the equity accounts of Pan American Energy and the
Company is presented in Note L.

Change in Year End
------------------

The Company changed its year end from December 31 to September 30, 2004.
Accordingly, the accompanying financial statements are as of and for various
periods ended September 30, 2004, and for the year ended December 31, 2003.

Revenue Recognition and Accounts Receivable
-------------------------------------------

The Company generates the following types of revenues:

     o    Sales of the physical card products to both distributors, and
          retailers.

     o    Initiation fees, which arise from sales of the Company's debit cards
          and stored value.


                                      F-10


<PAGE>

     o    Subscription fees, which arise from hosting or licensing fees. Under a
          hosted agreement, the Company's customers are not charged for the use
          of the Company's proprietary software; rather they pay a per minute or
          per transaction fee for each use whereas under a licensing agreement,
          the Company's customer pays monthly fees for the use of its software
          at each of their loading stations.

     o    Transaction fees, which arise from the use and loading of cash for
          ATM, debit or stored value cards.

     o    Maintenance fees, which arise from charges for keeping the cards
          active.

     o    Financial float fees, which arise from charges for the instant load of
          cash and convenience of stored value, ATM and debit cards.

The Company's revenue recognition policy for fees and services arising from its
products is consistent with the criteria set forth in Staff Accounting Bulletin
104 - Revenue Recognition in Financial Statements ("SAB 104") for determining
when revenue is realized or realizable and earned. In accordance with the
requirements of SAB 104 the Company recognizes revenue when, (1) persuasive
evidence of an arrangement exists; (2) delivery has occurred; (3) the Company's
price to the buyer is fixed or determinable; and (4) collectibility of the
receivables is reasonably assured. During the nine months ended September 30,
2004, one customer accounted for approximately 61% of the Company's revenues and
for the year ended December 31, 2003 two customers accounted for approximately
70% of the Company's revenues. .

Revenues are recognized on the accrual basis of accounting. Card sales are
recognized upon shipment to the customer. Goods may not be returned except for
defects. Management from time to time may authorize the return of product or
special discounts and allowances under unique circumstances in order to retain
customer loyalty. Fees for services are recognized at the time the service is
rendered and revenue for the sale of Stored Value and Money Cards is recognized
when the card is swiped. All sales are final; however, for business reasons,
management on a case by case basis can allow a customer an allowance against the
purchase price or allow a partial return of the product for credit.

The Company's payment terms are normally net 30 days. The Company performs
ongoing credit evaluations of all of its customers and generally does not
require collateral.

Allowance for Doubtful Accounts
-------------------------------

The Company evaluates the allowance for doubtful accounts on a regular basis for
adequacy. The level of the allowance account, and related bad debts are based
upon its review of the collectability of its receivables in light of historical
experience, adverse situations that may affect the Company's customers' ability
to repay, estimated value of any underlying collateral and prevailing economic
conditions. This evaluation is inherently subjective as it requires estimates
that are susceptible to significant revision as more information becomes
available.

Cash and Cash Equivalents
-------------------------

For purposes of the statement of cash flows, the Company considers all highly
liquid investments with an original maturity of three months or less to be cash
equivalents.

Use of Estimates
----------------

The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires the Company to make
certain estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements. The reported amounts of revenues and expenses during
the reporting period may be affected by the estimates and assumptions the
Company is required to make. Actual results could differ from the Company's
estimates.


                                      F-11


<PAGE>

Advertising Costs
-----------------

The Company expense advertising costs as they are incurred. Advertising costs
were $27,301, $632 and $34,797 during the nine months ended September 30, 2004,
the year ended December 31, 2003 and the period July 10, 2000 (date of
incorporation) to September 30, 2004, respectively.

Financial Instruments
---------------------

The Company believes the book value of its cash and cash equivalents and
accounts payable and accrued and other liabilities approximates their fair
values due to their short-term nature. The Company also believes the book value
of its notes payable approximates their fair values as the interest rates as
such obligations approximates rates that could currently be negotiated and
because of their short term nature. It was not practicable to estimate the fair
value of the portion of the note receivable from stockholder reflected as a
deduction from stockholders' equity because of the lack of similar type
arrangements in the marketplace.

Property and Equipment
----------------------

Property and equipment are stated at cost. Major additions are capitalized,
while minor additions and maintenance and repairs, which do not extend the
useful life of an asset, are expensed as incurred. Depreciation and amortization
are provided using the straight-line method over the assets' estimated useful
lives, which range from three to seven years.

Concentration of Credit Risk
----------------------------

Financial instruments, which potentially subject the Company to significant
concentrations of credit risk, consist primarily of cash and cash equivalents.
The Company occasionally maintains cash and cash equivalents balances in excess
of federally insured limits. The Company has not experienced any losses in such
accounts.

Goodwill and Other Intangibles
------------------------------

In July 2001, the FASB issued Financial Accounting Standards Statement No. 142
("SFAS 142"), "Accounting for Goodwill and Other Intangibles," which was
required to be adopted effective January 1, 2002. Under SFAS 142 goodwill and
indefinite lived intangible assets are no longer amortized but are reviewed, at
a minimum, annually for impairment. Separable intangible assets that are not
deemed to have an indefinite life will continue to be amortized over their
useful lives.

Long-Lived Assets
-----------------

Statement of Financial Accounting Standards (SFAS) 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets" requires that long-lived assets,
including certain identifiable intangibles, be reviewed for impairment whenever
events or changes in circumstances indicate that the carrying value of the
assets in question may not be recoverable. The Company evaluated its long-lived
assets during the nine months ended September 30, 2004 and determined that
certain impairment losses were necessary. As a result, the Company charged
operations for approximately $43,200 at September 30, 2004.

Net Loss Per Share
------------------

The Company computes net loss per share in accordance with SFAS No. 128
"Earnings per Share" ("SFAS No. 128") and SEC Staff Accounting Bulletin No. 98
("SAB 98"). Under the provisions of SFAS No. 128 and SAB 98, basic net loss per
share is computed by dividing the net loss available to common stockholders for
the period by the weighted average number of common shares outstanding during
the period. Diluted net loss per share is computed by dividing the net loss for
the period by the number of common and common equivalent shares outstanding
during the period. There were no common equivalent shares outstanding at any
time since the Company's inception; accordingly basic and diluted net loss per
share are identical for each of the periods in the accompanying financial
statements.


                                      F-12


<PAGE>

Stock - Based Compensation
--------------------------

Though no options were granted by the Company prior to September 30, 2005, the
Company has adopted Statement of Financial Accounting Standards No. 148
"Accounting for Stock-Based Compensation - Transition and Disclosure" (SFAS No.
148). This statement amends FASB statement No. 123, "Accounting for Stock Based
Compensation". It provides alternative methods of transition for an entity that
voluntarily changes to the fair value based method of accounting for employee
stock based compensation. It also amends the disclosure provision of FASB
statement No. 123 to require prominent disclosure about the effects on reported
net income of an entity's accounting policy decisions with respect to
stock-based employee compensation. As permitted by SFAS No. 123 and amended by
SFAS No. 148, the Company continues to apply the intrinsic value method under
Accounting Principles Board ("APB") Opinion No. 25, "Accounting for Stock Issued
to Employees," to account for its stock-based employee compensation
arrangements.

Income Taxes
------------

The Company computes income taxes in accordance with Financial Accounting
Standards Statement No. 109 "Accounting for Income Taxes" ("SFAS 109"). Under
SFAS 109, deferred taxes are recognized for the tax consequences of temporary
differences by applying enacted statutory rates applicable to future years to
differences between the financial statement carrying amounts and the tax basis
of existing assets and liabilities. Also, the effect on deferred taxes of a
change in tax rates is recognized in income in the period that included the
enactment date. Significant temporary differences arise from accounts payable
and accrued liabilities that are not deductible for tax reporting until they are
paid.

Research and Development
------------------------

Research and development costs, which approximated $73,600, $216,200 and
$310,600 for the nine months ended September 30, 2004, the year ended December
31, 2003, and the period July 10, 2000 (date of incorporation) to September 30,
2004, respectively, are expensed as incurred.

Recent Pronouncements
---------------------

The Company does not expect that the adoption of any recent accounting
pronouncements will have a material impact on its financial statements.

Reclassifications
-----------------

Certain amounts in the December 31, 2003 financial statements, and the financial
statements for the period July 10, 2000 (date of incorporation) to September 30,
2004 have been reclassified to conform to the presentation in the September 30,
2004 financial statements.

NOTE B - GOING CONCERN

The Company's financial statements are prepared using accounting principles
generally accepted in the United States of America applicable to a going
concern, which contemplate the realization of assets and liquidation of
liabilities in the normal course of business. The Company has incurred
significant losses since its inception, and the Company expects to have ongoing
requirements for additional capital investment to implement the Company's
business plan. In addition, the Company's ability to continue as a going concern
must be considered in light of the problems, expenses and complications
frequently encountered by entrance into established markets and the competitive
environment in which it operates. Since inception, the Company's operations have
primarily been funded through private equity, and the Company expects to
continue to seek additional funding through private or public equity and/or debt
financing. As discussed in Note A, on August 24, 2004, the Company acquired the
net assets of Pan American Energy Corp. a publicly traded company that it
believes will help the Company raise additional equity capital. In connection
with this merger, the Company acquired a $3,000,000 note receivable from


                                      F-13


<PAGE>

a stockholder that had a remaining balance of approximately $1,385,000 as of
November 26, 2004. In addition, as discussed at Note J, subsequent to September
30, 2004, the Company raised approximately $1,425,000 under a private placement
of our common stock. Finally, the Company expects that operating revenues from
the sales of its products and other related revenues will increase. However,
there can be no assurance that the funds the Company has in place will be
adequate to meet its cash flow needs for the year ended September 30, 2005 or
that the Company will be able to fund any cash shortfalls through additional
debt or equity capital and/or any cash generated by its operations. These
factors, among others, indicate that the Company may be unable to continue as a
going concern for a reasonable period of time.

The Company's financial statements do not include any adjustments relating to
the recoverability and classification of recorded asset amounts or the amounts
and classification of liabilities that might be necessary should the Company be
unable to continue as a going concern.

NOTE C - INCOME TAXES

The Company recognized losses for both financial and tax reporting purposes
during each of the periods in the accompanying statements of operations.
Accordingly, no provisions for income taxes and/or deferred income taxes payable
have been provided for in the accompanying financial statements.

Assuming the Company's net operating loss carryforwards are not disallowed by
taxing authorities because of certain "change in control" provisions of the
Internal Revenue Code, at September 30, 2004 the Company has net operating loss
carryforwards of approximately $1,095,000 for income tax purposes (the
significant difference between the Company's net operating carryforwards and its
deficit arises primarily from certain stock based and impairment expenses of
approximately $1,165,500 that are considered to be permanent differences between
book and tax reporting). These carryforwards expire in various years through the
year ended December 31, 2024. Components of the Company's current and
non-current deferred income tax assets, assuming an effective income tax rate of
39.5%, are approximately as follows at September 30, 2004:

Current deferred income tax asset:
    Accounts payable and accrued liabilities                        $   175,700
    Less valuation allowance                                           (175,700)
                                                                    -----------

Net current deferred income tax asset                               $         -
                                                                    ===========

Non-current deferred income tax asset:
    Net operating loss carry forward                                $   414,300
    Less valuation allowance                                           (414,300)
                                                                    -----------

Non-current deferred income tax asset                               $         -
                                                                    ===========


The Company's net current and non-current deferred income tax assets are not
recorded in the accompanying balance sheet because the Company established a
valuation allowance to fully reserve such assets as their realization did not
meet the required asset recognition standard established by SFAS 109. The total
valuation allowance increased by approximately $405,200 during the nine months
ended September 30, 2004

NOTE D - PROPERTY AND EQUIPMENT

Property and equipment consist of the following at September 30, 2004:

Computer software                                                   $    22,086
Computer hardware                                                        64,741
Furniture, equipment and leasehold improvements                          36,339
                                                                    -----------
                                                                        123,166
Less accumulated depreciation and amortization                           20,607
                                                                    -----------

Total                                                               $   102,559
                                                                    ===========


                                      F-14


<PAGE>

NOTE E - PURCHASE OF ASSETS OF TYPHOON VOICE TECHNOLOGIES, INC.

On December 31, 2003, primarily for the purpose of acquiring certain technology,
the Company acquired substantially all of the assets of Typhoon Voice
Technologies, Inc. ("TVT") in exchange for 1,421,357 shares of the Company's
common stock. The purchase price of $228,190 was allocated as follows:

Computer software                                                   $    19,615
Computer hardware                                                        28,847
In process research and development                                     153,190
Other assets                                                             26,538
Common stock                                                           (223,190)
Cash                                                                     (5,000)
                                                                    -----------
Total                                                               $         -
                                                                    ===========

The purchase price attributed to the acquired in process research and
development was $153,190 which was immediately expensed.

Since the transaction was accounted for as a purchase, the Company's 2003
results of operation only include the results of operations of TVT since the
date of acquisition. The Company's 2003 revenues, expenses, net loss and net
loss per share would not have changed significantly if the Company had included
such amounts for TVT for the entire year ended December 31, 2003.

NOTE F - OTHER NOTES PAYABLE

At September 30, 2004, other notes payable consisted of two unsecured notes
payable to a vendor. As discussed at Note J, the balance of these notes were
forgiven when the Company settled certain litigation with this vendor in
November 2004.

NOTE G -RELATED PARTY TRANSACTION

At December 31, 2003, the Company has a $36,500 note payable to an officer. The
note, which required interest at the rate of 12% per annum, was paid during the
nine months ended September 30, 2004.

At December 31, 2004, accounts payable and accrued liabilities include
approximately $163,800 owed to various officers for accrued payroll and
vacation.

NOTE H - COMMITMENTS AND CONTINGENCIES

Operating Leases
----------------

In April 2002, the Company entered a three year operating lease for its
facility. The Company then transferred that lease with the same landlord to a
larger facility effective in December 2003 under a new operating lease. Unless
it is sooner terminated and/or extended, the Company's lease agreement expires
November 30, 2006. Future minimum lease payments under this lease, and one other
operating lease entered in July 2004, are approximately as follows at September
30, 2004:


                                      F-15


<PAGE>


   Years ending
   September 30,                                                    Amounts
   -------------                                                 -------------

      2005                                                       $      37,500
      2006                                                              29,050
      2007                                                               4,900
                                                                 -------------

      Total                                                      $      71,450
                                                                 =============

Rent expense under the above leases for the nine months ended September 30, 2004
and the year ended December 31, 2003 approximated $31,800 and $15,900,
respectively.

Consulting Agreements
---------------------

Effective October 1, 2004, the Company entered into three consulting agreements
having terms ranging from one to two years and terminable by either party on 30
days notice. As consideration for various services to be rendered, the Company
has agreed to pay the consultants total monthly fees of (i) $14,000 during the
period October 1, 2004 to September 30, 2005 and (ii) $6,000 for the period
October 1, 2005 to September 30, 2006. In addition, the Company has granted
1,900,000 nonqualified stock options to these consultants, which options are
exercisable at $0.20 per share and may be exercised on a cashless basis. The
options vest as follows:

      Vesting Dates                                                 Amounts
      -------------                                              -------------

      On October 1, 2004                                               380,000
      On December 31, 2004                                             380,000
      On March 31, 2005                                                380,000
      On June 30, 2005                                                 380,000
      On September 30, 2005                                            380,000
                                                                 -------------

      Total                                                          1,900,000
                                                                 =============

Because the exercise price of $.20 was less than the fair value of the common
stock ($.27) on the grant, the Company estimates that it will recognize
approximately $133,000 of stock based compensation expense over the terms of
these consulting agreements beginning with the first quarter of fiscal year
ended September 30, 2005 (fair value for these options was estimated at the date
of grant using a Black-Scholes Option pricing model with the following
assumptions: risk-free interest rate of 2.21%; dividend yield of 0%; volatility
factor of the expected market price of the Company's common stock of .929; and a
weighted-average expected life of the option of one year).

Employment Agreements
---------------------

The Company has obligated itself under non-cancelable employment agreements with
its chief executive officer and its chief financial officer. The significant
terms of the agreements are as follows:

     o    CHIEF EXECUTIVE OFFICER - This officer is to receive base annual
          compensation of $185,000 for the year ending September 30, 2005,
          $205,000 for the year ending September 30, 2006 and $225,000 for the
          year ending September 30, 2007, as well as various vacation and
          medical benefits, a car allowance of $750 per month, an initial bonus
          of $75,000 and annual bonuses ranging from 2.5 to 3.0% of net income.
          In addition, the Company agreed to grant him options to purchase
          3,250,000 shares of its common stock at a price of $.20 per share (a
          significant portion of such grants served as consideration for him
          agreeing to cancel benefits and protections set forth in his prior
          employment agreement). The agreement, which is


                                      F-16


<PAGE>

          subject to automatic renewal unless the Company exercises its rights
          to terminate it at the end of the initial, or any succeeding, terms,
          contains a takeover provision that requires the Company to pay the
          greater of $750,000, or an amount equal to 7.5% of any sale price in
          excess of $25,000,000 to him in the event a change in control occurs.

     o    CHIEF FINANCIAL OFFICER - This officer is to receive base annual
          compensation of $165,000 for the year ending September 30, 2005,
          $180,000 for the year ending September 30, 2006 and $195,000 for the
          year ending September 30, 2007, as well as various vacation and
          medical benefits, a car allowance of $650 per month, an initial bonus
          of $75,000 and annual bonuses ranging from 2.5 to 3.0% of net income.
          In addition, the Company agreed to grant him options to purchase
          2,500,000 shares of its common stock at a price of $0.20 per share (a
          significant portion of such options served as consideration for him
          agreeing to cancel benefits and protections set forth in his prior
          employment agreement). The agreement, which is subject to automatic
          renewal unless the Company exercises its rights to terminate it at the
          end of the initial, or any succeeding, terms, contains a takeover
          provision that requires the Company to pay the greater of $500,000, or
          an amount equal to 5.0% of any sale price in excess of $25,000,000 to
          him in the event a change in control occurs.

One half of the stock options mentioned above (or 2,875,000 options) vested on
October 1, 2004. Assuming a change in control does not occur (at which time all
options would vest immediately), one half of the remaining options (or 1,437,500
options) vest on September 30, 2005 and one half on September 30, 2006. The
option price was effectively the same as the trading value of the Company's
stock on the date the options were granted and accordingly no stock based
compensation expense will be applicable as a result of the issuance of these
options. Furthermore, the Company does not believe that it will be required to
record any stock based compensation for the issuance of these options as it does
not begin reporting under SFAS No. 123(R) until all of these options have
vested.

The Company is also obligated under various other cancelable employment
agreements, including two that require it to pay different amounts of severance
if the Company terminates the respective employees without cause. Future
required payments for base compensation under all of the employment agreements
discussed herein are approximately as follows:

      Years ending
      September 30,                                                 Amounts
      -------------                                              -------------

         2005                                                    $     553,000
         2006                                                          530,000
         2007                                                          420,000
                                                                 -------------

         Total                                                   $   1,503,000
                                                                 =============

Service and Purchase Agreements
-------------------------------

The Company has entered into one to three year contracts with various
contractors to provide certain marketing, technology and customer support
services to expand the money card program. Since the fees to be paid are
contingent primarily on sales volume, it is not possible to calculate the amount
of the future commitment on these contracts.

Contingencies
-------------

In the normal course of business, the Company is involved in certain litigation.
In the Company's opinion, this litigation will not have a material effect on its
financial position or results or operations.


                                      F-17


<PAGE>

NOTE I - STOCK-BASED COMPENSATION

During the period July 10, 2000 (date of incorporation) to September 30, 2004,
the Company issued the following shares of the Company's common stock as
consideration for various services, which were provided by employees or
consultants:

Description of Service                     Value of Service      Shares Issued
----------------------                      --------------      --------------

Business planning and development           $      949,663           7,395,048
Information technology services                     57,123             505,075
Legal services                                       5,500              38,209
                                            --------------      --------------

Totals                                      $    1,012,286           7,938,332
                                            ==============      ==============

The value of these services, which was based on the number, and fair value, of
shares issued has been included in stock based compensation and consulting
expense in the accompanying statements of operations. For periods when the
Company was trading the Company used the stock price on the date of issuance to
determine fair value. Prior to the Company having a market in its stock, fair
value of the shares was determined as the approximate average cash sale price
for company stock sold in the year of the share grant date.

NOTE J - OTHER SUBSEQUENT EVENTS

Gain Contingency
----------------

On November 8, 2004, the Company settled certain litigation in which it was the
plaintiff. As consideration for such settlement, the Company received
forgiveness of notes payable totaling $50,000, cash of $10,000 and process
management software certified for use by MasterCard International. The proceeds
of the settlement will be reflected as other income in the first quarter of the
Company's fiscal year ending September 30, 2005.

Settlement of Litigation
------------------------

The Company settled certain litigation by agreeing to pay cash of $48,000
subsequent to year end. In accordance with generally accepted accounting
principles, the Company has recognized this amount as an expense and accrued
liability in the accompanying September 30, 2004 financial statements.

Other Option Issuances
----------------------

In addition to the options mentioned in Note H above, the Company has granted
options to purchase 1,825,000 shares of its common stock to various employees at
a price of $0.20 per share. Assuming a change in control does not occur (at
which time all options would vest immediately) the options vest as follows:

      Vesting Dates                                        Amounts
      -------------                                    --------------

      On October 1, 2004                                      610,000
      On September 30, 2005                                   607,500
      On September 30, 2006                                   607,500
                                                       --------------

      Total                                                 1,825,000
                                                       ==============

Because the Company continues to use the intrinsic value method to account for
its employee stock options, and because the option price was effectively the
same as the trading value of the Company's stock on the date the options were
granted, the Company does not believe that it will be required to record any
stock based compensation for the issuance of these options. Furthermore, the
Company does not believe that it will be required to record any


                                      F-18


<PAGE>

stock based compensation for the issuance of these options as it does not begin
reporting under SFAS No. 123(R) until all of these options have vested.

The Company also granted options to purchase 700,000 shares of its common stock
for $0.20 per share to the members of its Board of Directors as consideration
for their service during the upcoming fiscal year (i.e. the year ended September
30, 2005). The options, which vested on the date of grant, had a fair value of
approximately $0.27 on such date (fair value was determined using a
Black-Scholes Option pricing model with the following assumptions: risk-free
interest rate of 2.21%; dividend yield of 0%; volatility factor of the expected
market price of the Company's common stock of .929; and a weighted-average
expected life of the option of one year); accordingly the Company estimates that
it will recognize approximately $49,000 of stock based compensation expense
during the fiscal year ended September 30, 2005 as a result of the issuance of
these options.

Note Receivable from Stockholder
--------------------------------

As mentioned at Note A, the Company received a $3,000,000 note receivable from a
PAEC stockholder at the date of the merger with PAEC. Because of various
delinquencies in making payments under such note, in November 2004, this
stockholder agreed to return 1,000,000 shares of the common stock issued to the
PAEC shareholders at the date of the merger. The shares will be divided pro-rata
by the stockholders of Morgan Beaumont immediately before the merger occurred.
In addition, the stockholder has agreed to pledge 2,700,000 shares of his common
stock as security for the performance of his remaining obligations under the
note receivable. The pledged shares are to be returned to the stockholder as
required payments are made on the note, which is due in various installments
through March 31, 2005.

Private Placement of Stock
--------------------------

The Company completed a private placement of 7,125,000 of shares of its common
stock (the "Shares) to certain accredited investors (the "Purchasers") for
$1,425,000. The transaction was consummated pursuant to a Securities Purchase
Agreement by and between the Company and the Purchasers.

The Purchasers received (i) certain anti-dilution protection entitling them to
price adjustments in the event the Company sells shares for an effective price
of less than $0.20 per share within one year from the date of the completion of
the private placement, and (ii) the rights to participate in any subsequent
filings for a specified period of time.

In addition, the Company has also agreed to file, within 45 calendar days of the
date of the filing of its current 10-KSB, a registration statement with the SEC,
covering the resale of (i) the shares and (ii) any shares of common stock issued
or issuable upon a stock split, dividend or other distribution, recapitalization
or similar event. If the Company fails to timely perform its responsibilities
relative to the registration of the Shares, the Company will be subject to
various monetary penalties (as defined in the Private Placement Memorandum).

NOTE K - GROSS AND NET REVENUE AMOUNTS

                                                              For the period
                                               For the nine   July 10, 2000
                               For the year       months         (date of
                                   ended          ended      incorporation) to
                                 December     September 30,    September 30,
Description                      31, 2003          2004            2004
-----------                    ------------    ------------    ------------

Gross revenues                 $    357,785    $     59,128    $    601,798

Returns & allowances                 (1,913)           (526)        (11,579)
                               ------------    ------------    ------------

NET REVENUES                   $    355,872    $     58,602    $    590,219
                               ============    ============    ============


                                      F-19


<PAGE>

<TABLE>
NOTE L - SUMMARY OF THE EQUITY ACCOUNTS OF PAN AMERICAN ENERGY AND THE RECAPITALIZATION OF THE COMPANY (Unaudited)

As more fully described in Note A, on August 24, 2004, the Company acquired the net assets of PAEC, a summary of the equity accounts
of PAEC from August 31, 2003 (date of their last Audit) to August 24, 2004 (date of the merger)and how they changed when the Company
effected the acquisition.

                                                                                                          Deficit
                                                                                            Note        Accumulated
                                     Common Stock            Additional       Common     Receivable      During the
                              --------------------------      Paid-in         Stock         from        Development
                                 Shares       Par Value       Capital      Subscribed    Stockholder       Stage         Total
                              -----------    -----------    -----------    -----------   -----------    -----------   -----------
<S>                            <C>           <C>            <C>            <C>           <C>            <C>           <C>
Balances, August 31, 2003      12,065,000    $    12,065    $   517,935    $    20,000   $         -    $  (625,797)  $   (75,797)

Issuance of common stock
  for services at
  approximately $0.05254
  per share by Pan
  American Energy              48,260,000         48,260      2,487,552              -             -              -     2,535,812
Canceling of share
  subscriptions for Pan
  American Energy                                                              (20,000)                                   (20,000)
Cancellation of shares by
  Scott and Kornia Houghton   (20,000,000)       (20,000)        20,000                            -              -             -
Contribution of Note
  Receivable by Pan
  American Shareholders                                       3,000,000                   (3,000,000)                           -

Reverse stock split before
  the recapitalization with
  Morgan Beaumont             (13,325,000)       (13,325)        13,325                            -              -             -
Issuance of common stock
  after the reverse stock
  split by Pan American
  Energy                           25,000             25          1,225                                           -         1,250
Net loss  of Pan American
  Energy through August 24,
  2004                                                                                                   (2,472,265)   (2,472,265)
Effect of recapitalization              -              -     (3,098,062)             -                    3,098,062             -
                              -----------    -----------    -----------    -----------   -----------    -----------   -----------
Balances, August 31, 2004      27,025,000    $    27,025    $ 2,941,975    $         -   $(3,000,000)   $         -   $   (31,000)
                              ===========    ===========    ===========    ===========   ===========    ===========   ===========

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

End of financial statements


                                                                F-20
</TABLE>


<PAGE>

                                  EXHIBIT 31.a


                     CERTIFICATE OF CHIEF EXECUTIVE OFFICER
            PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002


I, Clifford Wildes, certify that:

1. I have reviewed this Form 10-KSB for the period ended September 30, 2004, of
Morgan Beaumont, Inc. (the "Company");

2. Based on my knowledge, this report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
made, in light of the circumstances under which such statements were made, not
misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the Company as of,
and for, the periods presented in this report;

4. The Company's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
EXCHANGE ACT RULES 13a-15 and 15d-15) for the Company and have:

     (a) Designed such disclosure controls and procedures to ensure that
material information relating to the Company, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly
during the period in which this report is being prepared;

     (b) Evaluated the effectiveness of the Company's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this report
(the "Evaluation Date"); and

     (c) Presented in this report the Company's conclusions about the
effectiveness of the disclosure controls and procedures based on its evaluation
as of the Evaluation Date;

5. The Company's other certifying officers and I have disclosed, based on its
most recent evaluation, to the Company's auditors and the audit committee of the
Company's board of directors (or persons performing the equivalent functions):

     (a) All significant deficiencies in the design or operation of internal
controls which could adversely affect the Company's ability to record, process,
summarize and report financial data and have identified for the Company's
auditors any material weaknesses in internal controls; and

     (b) Any fraud, whether or not material, that involves management or other
employees who have a significant role in the Company's internal controls; and

6. The Company's other certifying officers and I have indicated in this report
whether there were significant changes in internal controls or in other factors
that could significantly affect internal controls subsequent to the date of the
Company's most recent evaluation, including any corrective actions with regard
to significant deficiencies and material weaknesses.


Date: October 18, 2005              /S/ CLIFFORD WILDES
                                    ------------------------------
                                    Clifford Wildes, Chief Executive
                                    Officer, Treasurer and Director

* Provide a separate certification for each principal executive officer and
principal financial officer of the Company. See Rules 13a-14(a) and 15d-14(a).


                                       70


<PAGE>

                                  EXHIBIT 31.b


                     CERTIFICATE OF CHIEF FINANCIAL OFFICER
            PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002


I, Theodore Misiewicz, certify that:

1. I have reviewed this Form 10-KSB for the period ended September 30, 2004, of
Morgan Beaumont, Inc. (the "Company");

2. Based on my knowledge, this report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
made, in light of the circumstances under which such statements were made, not
misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the Company as of,
and for, the periods presented in this report;

4. The Company's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
EXCHANGE ACT RULES 13a-15 and 15d-15) for the Company and have:

     (a) Designed such disclosure controls and procedures to ensure that
material information relating to the Company, including its consolidated
subsidiaries, is made known to it by others within those entities, particularly
during the period in which this report is being prepared;

     (b) Evaluated the effectiveness of the Company's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this report
(the "Evaluation Date"); and

     (c) Presented in this report the Company's conclusions about the
effectiveness of the disclosure controls and procedures based on the Company's
evaluation as of the Evaluation Date;

5. The Company's other certifying officers and I have disclosed, based on the
Company's most recent evaluation, to the Company's auditors and the audit
committee of Company's board of directors (or persons performing the equivalent
functions):

     (a) All significant deficiencies in the design or operation of internal
controls which could adversely affect the Company's ability to record, process,
summarize and report financial data and have identified for the Company's
auditors any material weaknesses in internal controls; and

     (b) Any fraud, whether or not material, that involves management or other
employees who have a significant role in the Company's internal controls; and

6. The Company's other certifying officers and I have indicated in this report
whether there were significant changes in internal controls or in other factors
that could significantly affect internal controls subsequent to the date of the
Company's most recent evaluation, including any corrective actions with regard
to significant deficiencies and material weaknesses.


Date: October 18, 2005                    /S/ THEODORE MISIEWICZ
                                          -------------------------------------
                                          Theodore Misiewicz, Chief Financial
                                          Officer, Secretary and Director


* Provide a separate certification for each principal executive officer and
principal financial officer of the Company. See Rules 13a-14(a) and 15d-14(a).



                                       71


<PAGE>

                                  EXHIBIT 32.a

                            CERTIFICATION PURSUANT TO
                                 18 U.S.C. 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Morgan Beaumont, Inc. (the "Company")
on Form 10-QSB for the period ended September 30, 2004, as filed with the
Securities and Exchange Commission on the date hereof (the "Report"), I,
Clifford Wildes, in my capacity as Chief Executive Officer of the Company,
certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, that:

     The Report fully complies with the requirements of Section 13(a) or 15(d)
of the Securities Exchange Act of 1934; and

     The information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of the Company.


Date: October 18, 2005                  /S/ CLIFFORD WILDES
                                        ------------------------------
                                        Clifford Wildes,
                                        Chief Executive Officer


                                       72


<PAGE>

                                  EXHIBIT 32.b

                            CERTIFICATION PURSUANT TO
                                 18 U.S.C. 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002


In connection with the Annual Report of Morgan Beaumont, Inc. (the "Company") on
Form 10-KSB for the period ended September 30, 2004, as filed with the
Securities and Exchange Commission on the date hereof (the "Report"), I,
Theodore Misiewicz, in my capacity as Chief Financial Officer of the Company,
certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, that:

     The Report fully complies with the requirements of Section 13(a) or 15(d)
of the Securities Exchange Act of 1934; and

     The information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of the Company.


Date: October 20, 2005                 /S/ THEODORE MISIEWICZ
                                       ------------------------------------
                                       Theodore Misiewicz,
                                       Chief Financial Officer


                                       73