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

                                   FORM 10-KSB
                               ___________________

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


                                DECEMBER 31, 2002


                                       OR

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

        For the transition period from _______________ to _______________

                         Commission File Number 0-26897


                           JAVO BEVERAGE COMPANY, INC.
                 (Name of small business issuer in its charter)


                 DELAWARE                                       48-1264292
     (State or other jurisdiction of                         (I.R.S. Employer
      incorporation or organization)                       Identification No.)

                              1311 SPECIALTY DRIVE
                             VISTA, CALIFORNIA 92083
          (Address of principal executive offices, including zip code)

                                 (760) 560-5286
                           (Issuer's telephone number)

         Securities registered under Section 12(b) of the Exchange Act:

                                      NONE

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

                      COMMON STOCK, WITH PAR VALUE: $.001,
    SERIES A JUNIOR PARTICIPATING PREFERRED STOCK, PAR VALUE $.001 PER SHARE,
          AND RIGHTS TO PURCHASE SHARES SERIES A JUNIOR PARTICIPATING
                   PREFERRED STOCK, PAR VALUE $.001 PER SHARE
                                (Title of class)


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


<PAGE>

     Check if there is no disclosure of delinquent filers in response to Item
405 of Regulation S-B contained in this Form 10-KSB, 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. [ ]

     Issuer's revenues for its most recent fiscal year were $605,655.

     The aggregate market value of the voting stock held by non-affiliates of
the registrant as of March 27, 2003 was $28,474,000 based on the $0.20 per share
price at which the stock was sold of as of March 15, 2002.

     The number of shares outstanding of the registrant's Common Stock, $0.001
par value per share, ("Common Stock") was 142,371,434 as of March 28, 2003.

     Transitional Small Business Disclosure Format:   Yes [  ]   No [X]

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                                     PART I

ITEM 1.  BUSINESS

Javo(TM)Beverage Company, Inc. (the "Company" or "Javo") was originally
incorporated in Washington as North West Converters, Inc. on February 9, 1987.
In June of 1999, the Company changed its name to La Jolla Fresh Squeezed
Coffee(TM)Co., Inc. and its Board of Directors ratified the acquisition of the
assets of Stephen's Coffee, Inc. and the merger with Stephen's Coffee Holding,
Inc. On February 22, 2000, the Company acquired all the outstanding shares of
Sorisole Acquisition Corp. to become successor issuer to Sorisole pursuant to
Rule 12g-3 and subject to the reporting requirements of the Securities &
Exchange Commission. On August 21, 2002, the Company reincorporated from
Washington state to the state of Delaware and simultaneously changed its name to
Javo Beverage Company, Inc.

The Company is a technology-based manufacturer and marketer of coffee
concentrates and extracts for the foodservice, flavor and ingredient industries.
Javo offers to foodservice operators such as restaurants, hotels, and hospitals,
a line of coffee concentrates. The concentrates are sold in a bag-in-box ("BIB")
packaging format for use in liquid coffee dispensers and in bottles for quick
preparation of large quantities of coffee without the need for a dispenser.
These products allow foodservice operators to consistently serve coffee
on-demand with fresh-brewed flavor and aromatics without the operational
difficulties and waste associated with batch brewing coffee on-site in
traditional fashion. Javo's high-grade coffee extracts are marketed to food
processors as a means of bringing genuine coffee flavor to their consumer food
products.

IMPORTANT FACTORS RELATED TO FORWARD-LOOKING STATEMENTS AND ASSOCIATED RISKS
----------------------------------------------------------------------------

This report on Form 10-KSB contains certain forward-looking statements that are
based on current expectations and involve a number of risks and uncertainties.
All of the non-historical information herein is forward-looking. The
forward-looking statements included herein and elsewhere in this filing are
based on, among other items, current assumptions that the Company will reach a
point at which it will be able to meet its operating cash and debt service
requirements with internally generated funds, that it will be able to
successfully resolve disputes and other business matters as anticipated, that
competitive conditions within the coffee and ingredients industries will not
change in a manner that materially and adversely affects the Company's current
or future operations, that the Company will retain existing key personnel, that
the Company's forecasts will reasonably anticipate market demand for its
products, and that there will be no materially adverse changes affecting the
Company's operations or business. Related or other factors that could cause
results to vary materially from current expectations are discussed below in this
Part 1, Item 1 entitled "Risk Factors" and elsewhere in this report on Form
10-KSB. Assumptions relating to forward-looking statements involve judgments
about matters that are difficult to predict accurately and are subject to many
factors that can materially affect results. Forecasting and other management
decisions are subjective in many respects and thus susceptible to
interpretations and periodic revisions based on actual experience and business
developments, the impact of which may cause the Company to alter its forecasts,
which may in turn affect the Company's results. The Company does not undertake
to update any forward-looking statements made herein, and shall do so only as
and when the Company determines to do so. In light of the factors that can
materially affect the forward-looking information included herein, the inclusion
of such information should not be regarded as a representation by the Company or
any other person that the objectives or plans of the Company will be achieved.
Readers are cautioned against giving undue weight to forward-looking statements
and are asked to consider all of the factors referred to herein, in subsequent
filings by the Company with the Securities and Exchange Commission or elsewhere.

PRODUCTS

Javo formulates, manufactures and sells coffee concentrates and extracts. The
Company's mission is to take away the operational pain associated with serving
consistently great tasting coffee for foodservice operators. In the ingredient
market, our mission is to capture the opportunity that lies in the growing
popularity of coffee-flavored foods and beverages by offering a superior coffee
flavorant to food processors. To date, a majority of the Company's sales have
derived from ingredient extract business much of which has focused on a few
large food processor customers. Since the second quarter of last year, the
Company has been aggressively establishing a platform for coffee concentrate
sales and plans for this to ultimately represent a higher portion of its overall
sales.

In foodservice, Javo offers three different coffee blends:

         o        FRENCH ROAST. French Roast is Javo's premium product and its
                  blend incorporates the highest quality of coffee beans within
                  Javo's product line. The darker roast of this product and its
                  bean selection bring out richer, smoother notes akin to
                  specialty coffees. French Roast regular and decaf are offered

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                  in gallon and 1/2 gallon bag-in-box for use in liquid coffee
                  dispensing equipment and as a handmix in 32 ounce plastic
                  bottles designed to instantly prepare up to five gallons of
                  finished coffee.

         o        COLOMBIAN. Javo's Colombian Blend is a product targeting the
                  center of foodservice coffee consumption and taste
                  preferences. Javo anticipates this product to eventually
                  comprise the majority of its foodservice sales. Javo's
                  Colombian regular and decaf are offered in gallon and 1/2
                  gallon bag-in-box and 32 oz. handmix formats

         o        DOUBLE ROAST. Double Roast is Javo's value-oriented blend for
                  operators with greater price sensitivity. Double Roast regular
                  and decaf are offered in gallon and1/2gallon bag-in-box and 32
                  oz. handmix formats.

In ingredient extracts, Javo generally custom blends an extract for each
application. These products are produced at lower concentration levels and are
shipped in bulk containers to the food processor customer.

Javo also develops and offers finished and lightly concentrated coffee beverages
such as lattes and granita or frozen beverages that are manufactured by third
party co-packers.

SALES AND MARKETING

End-use customers in the roughly $8.9 billion food service market are primarily
operators that currently use traditional on-site brewing methods to prepare
coffee in restaurants, hotels, offices, stadiums and other venues. To access
these users, the Company has begun over the past year to establish a network of
broad-line foodservice distributors and specialty beverage firms. These
distribution partners deliver our products to the operators and, in many cases,
provide them with the necessary dispensing equipment and regular equipment
maintenance and service. The costs relating to providing and maintaining the
equipment are passed on to the customer in the form of up-charges on product
they purchase similar to most equipment-based beverage programs. Sales are
generated by Javo salespeople who work with distributors to generate leads and
gain accounts. The Company also promotes and markets its products at trade shows
and in trade journals. In order to protect market position and margin structure
in the long term, the Company has developed a retail brand name and
merchandising package that it will make available to its end users to promote
their coffee service.

In the Company's second market, industrial ingredients, the end users are a
growing list of food processors desiring to develop coffee-flavored foods and
beverages. To compete effectively in this market, management believes it must
provide a great tasting coffee extract with superior blending and pasteurization
characteristics at an acceptable price as compared to other powder and liquid
extracts in the market. The Company intends to gain new ingredient business
primarily through its recently formalized relationship with WILD Flavors, Inc.,
a large, well-established flavor house.

RAW MATERIALS

Javo's main raw material is green coffee, which it acquires from various parts
of the world through the coffee spot market and coffee brokers. The
availability, price, and quality of coffee beans fluctuates throughout the year
based on weather, supply and other factors typically associated with global
agricultural commodities. The varieties of beans that the Company uses generally
tend to be readily available as compared to coffee beans in general. The
Company, where possible, also identifies equivalent varieties that can act as a
substitute in the event of the unavailability of a particular variety.
Nevertheless, the Company is dependent upon consistent access to green coffee to
maintain its operations.

ROASTING AND GRINDING

Javo has a primary vendor that performs the majority of its roasting and
grinding of coffee beans. The roaster is housed in Javo's facility and operates
as a separate but closely linked business. Javo's roasting and grinding needs
comprise the great majority of this primary roaster's business. By allowing the
roaster to operate within Javo's facility, Javo is able to exploit the extra
space it currently has in its facility and achieve lower pricing on roasting and
grinding services. Javo also cultivates alternative roasters to provide
redundancy in the event of a failure of its primary vendor.

SALES CHANNELS AND ORGANIZATION

The Company is building its sales organization to carry its value proposition to
two key channels within the foodservice market: national accounts (such as fast
food and convenience stores) and independent operators. The Company has recently
entered into agreements with a large global ingredient house to exclusively
represent the Company's products in the food ingredients industry, and with the
largest US broadline distributor to distribute the Company's products through

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its national system of distribution. Separately, the Company has also announced
that it has secured a national service agreement for its foodservice customers
from the industry's leading vendor.

COMPETITIVE POSITIONING

Coffee is a large, highly competitive, and, for its size, fragmented market. The
Company's foodservice bag-in-box and handmix products compete both against
providers of roast and ground coffee for traditional on-site brewing and other
providers of coffee concentrates. Versus roasted and ground coffee, Javo's
products offer operational convenience, little or no waste, and perfect flavor
consistency. There is a price premium for coffee concentrates, including Javo's,
over roast and ground coffee. However, when considering upon an operator's
traditional brewing costs for factors such as waste, pilferage, and preparation
labor, all of which are dramatically reduced or eliminated when using coffee
concentrates, use of Javo's concentrates often saves the operator money. Added
to this are the less tangible costs of traditional onsite brewing such as those
resulting from serving bitter or stale coffee that has sat on a burner too long
or making customers wait for coffee to be brewed.

In the liquid coffee concentrate and soluble markets, there are a few key
participants with which Javo currently competes. The Company's largest direct
competitor is Douwe Egberts Coffee Systems, a division of Sara Lee Corporation.
Douwe Egberts ("DE") is large-scale coffee company based in the Netherlands. In
the United States, DE offers a line of coffee concentrates sold in conjunction
with proprietary DE dispensers both directly and through third party
distributors. DE's concentrates are transported from Europe and distributed in a
frozen state. The end-user, such as a restaurant operator, must thaw the product
prior to use. DE's competitive strength lies in its size, financial strength and
long established experience in coffee. Javo products compete favorably with DE
products in terms of price, cost of associated dispensing equipment, BIB ease of
use (non-frozen vs. frozen), and management believes, taste. Other participants
in the liquid coffee market include Vitality, a U.S.-based foodservice beverage
company focused primarily in juices that also offers a frozen coffee product
used in a proprietary dispenser. Based in Tampa, Florida, Vitality's coffee
concentrates enjoy a strong market position in the cruise line industry. Xcafe
is a coffee roaster and extractor based in Portland, Maine. A relatively small
company compared to DE and Vitality, Xcafe offers a liquid, shelf-stable coffee
concentrate and also markets coffee extracts to the ingredient industry. Like
Javo, Xcafe offers a bag-in-box product that is compatible with various
dispensers manufactured by third parties such as Bunn, Kway, and Grindmaster.

Liquid concentrates and soluble coffees currently represent a very small
percentage of overall coffee sales in the United States. While the Company does
compete directly against other coffee concentrate providers such as those
described above, much of its target market consists of current users of
traditional roasted, ground coffee that would be converted to Javo's on-demand
system.

INTELLECTUAL PROPERTY

The Company currently relies on trade secret protection using both contractual
and physical measures as its means of protecting the proprietary processes and
information it has developed and compiled over the last approximately ten years.
The Company has not sought patent protection, given that it would require a
detailed disclosure of the proprietary methods being patented. Monitoring
infringement of such a patent would be difficult and the potential for
competitors to engineer around such a patent without infringing might be
significant. Nevertheless, trade secret protection has its disadvantages as a
form of intellectual property protection relying on internal steps taken to keep
proprietary information confidential. In commercializing its processes, the
Company must disclose certain aspects of its trade secrets to outside parties
who agree to be bound by confidentiality agreements. If such an agreement is
materially violated, the Company could incur significant expense and what
management believes is one of its competitive advantages could be compromised.
Over the past two years, the Company has substantially completed the decade-long
research and development of its extraction methods and will continue to refine
its process to improve product stability, quality, and yield.

The Company is also in the process of registering its trademark with the United
States Patent and Trademark Office.

EMPLOYEES

As of March 31, 2003, the Company employs 22 full-time employees. The Company
also uses outside consultants and other independent contractors from time to
time.

                                       5

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GOVERNMENT REGULATION

Javo's facility and operations are subject to various laws and regulations
relating to health and safety and environmental issues. The roasting operations
of our co-located primary roaster, upon which we rely for most of our roasting
and grinding needs, are subject to various air quality and environmental laws.
While the Company believes that its and its primary roaster's operations are
compliant with these laws, a finding of non-compliance could potentially
interfere with or even halt our operations.

RISK FACTORS

THE COMPANY MAY NOT BE ABLE TO RETAIN OR HIRE KEY PERSONNEL.

To operate successfully and manage our potential future growth, the Company must
attract and retain qualified managerial, sales, and other personnel. We face
competition for and cannot assure that we will be able to attract and retain
such qualified personnel. If Javo loses its key personnel or is unable to hire
and retain additional qualified personnel in the future, its business, financial
condition and operating results could be adversely affected.

THE COMPANY HAS NOT PAID DIVIDENDS TO ITS SHAREHOLDERS IN THE PAST, AND DOES NOT
ANTICIPATE PAYING DIVIDENDS TO ITS SHAREHOLDERS IN THE FORESEEABLE FUTURE.

The Company has not declared or paid cash dividends on its Common Stock. The
Company presently intends to retain all future earnings, if any, to fund the
operation of its business, and therefore the Company does not anticipate paying
dividends on Common Stock in the foreseeable future.

THE COMPANY HAS NEAR-TERM CAPITAL NEEDS AND MAY BE UNABLE TO OBTAIN ADDITIONAL
FUNDING NECESSARY TO ENABLE IT TO CONTINUE TO EXECUTE ITS BUSINESS PLAN.

Presently, the Company has a relatively fixed amount of liquid assets with which
to pay its expenses. The Company does not have sufficient liquid assets to
implement management's business plan. There can be no assurance that additional
capital will be available to the Company, or if available, on favorable terms.
If adequate funds are not available, the Company may be required to curtail
operations or to obtain funds by entering into collaboration agreements on
unfavorable terms.

THE COMPANY HAS A LIMITED OPERATING HISTORY.

The Company has a limited operating history upon which an evaluation of its
prospects can be made. The Company's prospects must be considered speculative
considering the risks, expenses, and difficulties frequently encountered in the
establishment of a new business, specifically the risk inherent in the
development of specialty coffee products such as liquid coffee concentrates.
Over the course of 2002, the Company has begun its transition from a largely
research and development based operation into a manufacturing company. There can
be no assurance that unanticipated problems will not occur which would result in
material delays in future product commercialization or that our efforts will
result in successful product and service commercialization. There can be no
assurance that the Company will be able to achieve profitable operations.

THE COMPANY DEPENDS ON ACCESS TO COMMODITY GOODS AND SERVICES AT COMPETITIVE
PRICES.

As the Company grows, it must be able to obtain at competitive prices
substantial amounts of certain green coffee beans and manage roasting and
grinding costs. The Company's coffee bean and roasting and grinding costs make
up a large component of its overall cost of goods sold. Commodity agricultural
goods such as coffee can and do experience significant fluctuations in
availability and prices which could in turn cause significant interruptions in
the manufacturing output and sales of the Company.

THE COMPANY IS IN A VERY COMPETITIVE INDUSTRY.

Competition to provide coffee products is intense and Javo expects the
competition to increase. The Company competes directly with other companies that
have developed and are in the process of developing products that will be
competitive with the products developed and offered by Javo. There can be no
assurance that other products, which are functionally equivalent or similar to
Javo products, have not been developed or are not in development. We expect that
there are companies or businesses that may have developed or are developing such
products. There are other companies and businesses that have the expertise to do
so and significant success in the marketplace could encourage them to develop
and market products directly competitive with those developed and marketed by
Javo. As a result of the size and breadth of certain of Javo's competitor's,

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such competitors have been and will be able to establish managed accounts by
which they seek to gain a disproportionate share of users for their products.
Such managed accounts can present significant competitive barriers to Javo.

THE COMPANY RELIES ON A RELATIVELY NEW AND PROPRIETARY EXTRACTION PROCESS.

Over roughly the past decade, the Company has developed what management believes
is a new and novel method of extracting roasted, ground coffee into a liquid
concentrate. The Company also believes that it derives a competitive advantage
vis a vis other liquid concentrate manufacturers from the quality of concentrate
that this process produces. The Company currently relies on trade secret
protection to prevent others from using this process. Trade secret protection is
only as effective as the Company's ability to keep the essential and material
aspects of its process secret using contractual and physical measures. There is
no guarantee that the Company's efforts in this regard can and will prevent a
competitor from obtaining the Company's secrets or from independently developing
the same or similar process. The Company may seek patent protection for certain
aspects of its processes upon achieving greater financial strength, but there
are no guarantees that any aspect of the process is patentable.

TRADING VOLUME IN THE COMPANY'S SECURITIES IS LIMITED AND SPORADIC.

The Company's Common Stock is traded on the Over the Counter Bulletin Board
under the trading symbol "JAVO." While there currently exists a limited and
sporadic public trading market for the Company's securities, the price paid for
the Company's Common Stock on the Over the Counter market and the amount of
stock traded are volatile. There can be no assurance that these markets will
improve in the future.

FORWARD LOOKING STATEMENTS

Some statements and information contained in this Annual Report are not
historical facts, but are forward-looking statements. They can be identified by
the use of forward-looking words such as "believes," "expects," "plans," "may,"
"will," "would," "could," "should," or "anticipates," or other comparable words,
or by discussions of strategy, plans or goals that involve risks and
uncertainties that could cause actual results to differ materially from those
currently anticipated. We warn you that these forward-looking statements are
only predictions, subject to risks and uncertainties. Actual events or results
can differ materially from those expressed or implied as a result of a variety
of factors, including those set forth above under "Risk Factors."

ITEM 2.  PROPERTY

Javo's facilities, including its principal executive offices are located in
Vista, California in San Diego County. The Company entered into a seven-year
lease of an approximately 38,000 square foot building on June 30, 2002. In
September and October of 2002, following the completion of tenant improvements,
the Company relocated from its Miramar facility in San Diego to the new Vista
facility. The new facility houses Javo's entire operation as well as those of
its principal roaster.

ITEM 3.  LEGAL PROCEEDINGS

In the fall of 2002, the Company relocated to a new facility in Vista,
California. The Company hired a food technology consultant to design and
implement certain production room infrastructure improvements. Portions of the
resulting work proved faulty and of poor design and the Company asked that
certain parts of the work be redone. The consultant declined to take
responsibility and demanded a final payment of approximately $8,000. Pending
resolution of the problem, the Company withheld that final payment to the
consultant. On February 26, 2003, the consultant filed suit in California
Superior Court in San Diego County for, among other things, breach of contract,
money due on account, and unjust enrichment claiming damages in the amount of
$17,950.32. The Company believes that the claim is without merit and intends to
defend against this claim.

While there can be no assurance that an adverse determination of this matter
could not have a material adverse impact in any future period, management does
not believe, based upon information known to it, that the final resolution of
this matter will have a material adverse effect upon the Company's financial
position and annual results of operations and cash flows.

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

The Company did not submit any matters to a vote of stockholders during the
final quarter of fiscal year 2002.

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                                     PART II

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

MARKET INFORMATION

The Company's Common Stock is traded over-the-counter and quoted on the OTC
Electronic Bulletin Board under the symbol "JAVO." The reported highest and
lowest prices for the Common Stock for each quarter as reported by the NASDAQ
OTC Bulletin Board are shown below for fiscal years 2001 and 2002 and the first
quarter of 2003. These quotations represent prices between dealers and do not
include retail markup, markdown or commission nor do they represent actual
transactions.

                                                       HIGH               LOW

2001
         First Quarter                               $0.2656            $0.0469
         Second Quarter                              $0.1800            $0.0469
         Third Quarter                               $0.1200            $0.0400
         Fourth Quarter                              $0.0900            $0.0500

2002
         First Quarter                               $0.3600            $0.0800
         Second Quarter                              $0.3350            $0.1400
         Third Quarter                               $0.5100            $0.2600
         Fourth Quarter                              $0.4700            $0.2500

2003
         First Quarter                               $0.2950            $0.1500


SHAREHOLDERS

As of December 31, 2002, the Company had approximately 600 holders of record of
our Common Stock and 139,321,434 shares of Common Stock outstanding.

DIVIDENDS

The Company has not declared a dividend during the past two fiscal years, nor
since the end of the last fiscal year.

SALES AND ISSUANCES OF UNREGISTERED SECURITIES

From November 1998 through March 1999, the Company issued 1,000,000 shares of
its Common Stock to thirty-one individuals for $350,000 or $0.35 per share. The
offering was exempt from registration pursuant to Regulation D of the Securities
Act of 1933.

From April 1999 through November 1999, the Company agreed to issue 921,998
shares of its Common Stock to twelve individuals in return for $576,800 or $0.65
per share. The offering was exempt from registration pursuant to Regulation D of
the Securities Act of 1933.

From December 1999 through June 2001, the Company issued 9,938,981 shares of its
Common Stock to forty-three individuals in return for $1,021,175 or an average
of $0.10 per share. The offering was exempt from registration pursuant to
Regulation D of the Securities Act of 1933.

From September 2001 through December 2001, the Company issued 3,736,250 shares
of its Common Stock to nine individuals in return for $149,450 or $0.04 per
share. In addition to the shares, the nine individuals received one-year
warrants for the purchase of 1,868,125 at $0.20 per share, which expired on or
before December 31, 2002. The offering was exempt from registration pursuant to
Regulation D of the Securities Act of 1933.

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From February through March 2002, the Company issued 15,000,000 shares at $0.075
per share in connection with the private placement offering for a $1,000,000
bridge loan, which was funded in February 2002. The Company recorded expenses in
connection with the issuances of $1,125,000. From April through June 2002, as
the second phase of the offering, the Company issued 30,000,000 shares at $0.17
per share in connection with a second phase of this private placement offering
for a $5,000,000 loan, which was funded in April 2002. The two-phase offering
was exempt from registration pursuant to Rule 506 of Regulation D of the
Securities Act of 1933.

Pursuant to a Private Placement Memorandum dated February 28, 2003, the Company
plans to issue a total of 36,000,000 shares of Common Stock in connection with a
$6,000,000 private placement. The 36,000,000 shares comprising the equity
portion of the offering has been contributed to the Company's stock treasury by
members of executive management of the Company. The Company is relying on
exemption from registration pursuant to Rule 506 of Regulation D of the
Securities Act of 1933.

SUBSIDIARY ACQUISITION

In February 2000 the Company entered into an agreement to acquire all the
outstanding shares of Sorisole Acquisition Corp. to become successor issuer to
it pursuant to Rule 12g-3 and subject to the reporting requirements of the
Securities & Exchange Commission. On June 16, 2000 in connection with the
acquisition, the Company issued 3,500,000 shares of its Common Stock. The
issuance was exempt from registration.

2002 EXECUTIVE ISSUANCE

In February 2000, the Company agreed to issue 3,912,500 shares of its Common
Stock to three employees in return for four ten-year promissory notes totaling
$545,000 carrying interest at six percent per annum. The Company recorded
expenses totaling $870,750 in connection with the issuance. The issuance was
exempt from registration pursuant to Section 4(2) of the Securities Act of 1933.
See Item 12 herein for further details.

In January 2002, the Company issued 17,975,646 shares at $0.04 per share to key
employees and executives based on employment with the Company. The shares issued
were subject to forfeiture according to related employment agreements. The
Company recorded expenses in connection with the issuances of $719,026. The
issuance was exempt from registration pursuant to Section 4(2) of the Securities
Act of 1933. The majority of these shares were recently returned to the Company
stock treasury in March and April of 2003 as part of a total contribution to
treasury by the five members of the Company's management of 36,000,000 shares of
Common Stock.

STOCK ISSUANCES FOR DISPUTE SETTLEMENTS

From September through December 2001, the Company issued 520,000 shares of its
Common Stock to seven individuals in negotiated settlement of disputes. The
Company recorded expenses for the issuances of $20,800 or $0.04 per share. The
issuance was exempt from registration pursuant to Section 4(2) of the Securities
Act of 1933.

STOCK ISSUANCES FOR THIRD PARTY SERVICES

From April through December of 2001, the Company agreed to issue 3,465,910
shares of its Common Stock to twenty individuals and/or companies for services
provided to the Company. The Company recorded expenses for the issuances of
$200,144. The offering was exempt from registration pursuant to Section 4(2) of
the Securities Act of 1933.

In June 2002, the Company issued 67,000 shares at $0.14 per share for consulting
services rendered. The Company recorded expenses for the issuance of $10,000.
The offering was exempt from registration pursuant to Section 4(2) of the
Securities Act of 1933.

In August 2002, the Company issued 41,561 shares at $0.32 per share in payment
for consulting services. The Company recorded expenses for the issuance of
$13,300. The issuance was exempt from registration pursuant to Section 4(2) of
the Securities Act of 1933.

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STOCK ISSUANCES TO EMPLOYEES FOR SERVICES

From February through June 2001, the Company agreed to issue 1,012,000 shares of
its Common Stock to three of its employees for past services. The Company
recorded an expense for the issuances of $85,425. The issuance was exempt from
registration pursuant to Section 4(2) of the Securities Act of 1933.

In addition, one of the above employees in March 2001 purchased 62,500 shares of
stock for $5,000 cash. The issuance was exempt from registration pursuant to
Section 4(2) of the Securities Act of 1933.

In June 2002, the Company issued 600,000 shares at $0.14 per share to employees
in connection with their employment. A significant portion of the shares issued
are subject to forfeiture according to terms of their employment. The issuance
was exempt from registration pursuant to Section 4(2) of the Securities Act of
1933.

In July 2002, the Company issued 5,000 shares at $0.17 per share to an employee
in connection with their employment. A significant portion of the shares issued
are subject to forfeiture according to terms of their employment. The issuance
was exempt from registration pursuant to Section 4(2) of the Securities Act of
1933.

STOCK ISSUANCES TO EXECUTIVES FOR CONTRIBUTION OF EXPENSES AND CASH

In September 2001, three executives converted amounts owed to them for past
services, Company expenses paid by them individually and cash advances to the
Company to 6,571,604 shares of its Common Stock. The Company offset its accrued
liabilities and loans payable by $262,864. The issuance was exempt from
registration pursuant to Section 4(2) of the Securities Act of 1933.

In January 2002, the Company issued 23,907,473 shares at $0.04 per share to key
employees and executives as payment of amounts owed by the Company for expenses
and past services. The majority of these shares were returned to the Company
stock treasury in March and April of 2003 as part of a total return to treasury
by the five members of the Company's management of 36,000,000 shares of Common
Stock.

WARRANTS EXERCISED

In April 2000, the Company issued 402,000 shares of its Common Stock to seven
individuals in exercise of warrants issued in 1998. The exercise prices of
$0.015 per share represented a total of $6,030 in exercise cash. The issuance
was exempt from registration.

In December 2002, the Company issued 12,500 shares for $2,500 in connection with
the exercise of a warrant held at $0.20 per share. The issuance was exempt from
registration.

In December 2002, The Company issued 150,000 shares for $12,750 in connection
with the exercise of warrants held at $0.085 per share. The issuance was exempt
from registration.


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

The following discussion and analysis should be read in conjunction with the
Company's financial statements and related notes included in this report and,
except for historical information, may contain forward-looking statements within
the meaning of applicable federal securities law.

For years Ended December 31, 2002 and 2001

REVENUES

The revenues in 2002 increased to $605,655 from $148,528 received in 2001. The
increase of $457,127 or 307.8% in sales is primarily due to sales of its coffee
extract to a food processor for use as a flavorant in a frozen beverage product.
The Company anticipates continued growth in sales not only of its ingredient
extracts but also of its foodservice bag-in-box and handmix products in 2003.

                                       10

<PAGE>

RESEARCH AND DEVELOPMENT EXPENSES

Research and development expenses were $964,836 in 2002 compared to $313,259 in
2001, an increase of $651,577 or 208%. The significant increase was due to the
cost of development of coffee formulations, the hiring of consultants and
additional labor and raw materials relating to testing, process improvements,
and product development.

SELLING AND MARKETING EXPENSES

Selling and marketing expenses for 2002 were $1,061,988 compared to $787,524 in
2001. The increase of $274,464 or 34.9% is primarily attributed to hiring
additional sales and market directors, increased use of coffee samples and
increased expenses for trade shows. The Company anticipates these expenses will
increase in the coming months as we open additional markets and continue to
increase the sales and support staff.

GENERAL AND ADMINISTRATIVE EXPENSES

General and administrative expenses for 2002 were $2,088,372 in 2002 compared to
$893,633 in 2001. The increase of $1,194,739 or 133.7% is primarily due to an
increase in a variety of expenses including additional employee and executive
salaries and overhead, purchase of Director and Officers liability insurance,
increased occupancy cost for new 38,000 square foot office and manufacturing
facility, and charges to expense for issuance of Common Stock for future
employee and executive expenses.

OTHER EXPENSES

Other expenses were $1,872,528 in 2002 compared to net other income of $28,931
in 2001. The increase in net other expense of $1,901,459 is primarily
attributable to one time non-cash charges totaling $1,125,000 in connection with
the issuance of stock to the investors who funded the bridge loan of $1,000,000.
In addition the Company incurred or accrued interest expense and amortization of
issuance discount on the loans of $789,795. The other expenses were offset
primarily by interest income of $42,267 received, an increase of $10,602 over
2001 interest income.

NET LOSS

The net loss for the Company for 2002 was ($6,017,642) compared to ($2,010,021)
in 2001, an increase of ($4,007,621) or 199.4%. The increase was primarily due
to non-cash expenses related to issuance of stock in connection with its debt of
$1,498,333, the non-cash expenses related to issuing stock to hire and retain
executives and key employees of $1,764,300, and additional cash expenses for
staffing and warehousing the sales, quality assurance/quality control, warehouse
departments and executives of the Company.

LIQUIDITY AND CAPITAL RESOURCES

The Company has experienced net losses and negative cash flow from operations
each year since inception. Through December 31, 2002, it had incurred an
accumulated deficit of $19.6 million and had consumed cash from operations and
financing in excess of $8.4 million. It had financed operations since inception
through capital contributions from our founder, related-party loans and private
placements of our Common Stock. The Company is in the process raising $6,000,000
through a private placement of units of debt with Common Stock. The proceeds of
the $6,000,000 private offering are planned to be used to purchase dispensers,
for capital improvements, expand sales and marketing efforts, and provide
working capital. The Company has raised $525,000 through the private offering
through April 11, 2003. In connection with the raise, the Company anticipates
issuing 36,000,000 share of Common Stock. Key executives contributed the
36,000,000 shares of Common Stock in March and April 2003 so that the private
offering would not increase the number of outstanding shares of Common Stock.

In December 2001 and January 2002, the Company developed a two-phase private
placement of debt with an equity component, and began engaging its key employees
and executives through employment agreements and converting its growing
liability to its key employees and executives for accrued compensation and
expenses into Common Stock. In January 2002, the Company agreed to issue 22.2
million shares of its Common Stock at $0.04 to its five key executives for all
past services, company expenses and cash advances to the Company. In addition,
the Company entered into five-year employment agreements with its five key
executives, which sets initial compensation levels and provides an additional
17.44 million shares subject to potential right of repurchase by the Company.
The five highest ranking executives recently contributed 36,000,000 shares of
Common Stock to the Company's stock treasury to facilitate the current
$6,000,000 private placement offering.

                                       11

<PAGE>

On February 8, 2002, the Company closed a one-year bridge loan debt offering for
$1,000,000, phase one of the private placement offering. The bridge loan
resulted in net cash to the Company of $950,000. The Company issued 15 million
shares of its Common Stock in connection with the bridge loan financing. The
funds were and are being used to pay current and past trade payables, to acquire
coffee to execute its current sales orders, to acquire production equipment, to
engage sales organizations for sale of its coffee concentrates to chain food
service stores and to provide operating capital.

On April 10, 2002, the Company closed a five-year loan for $5,000,000, phase two
contemplated by the private placement. No payments are due on the phase two loan
until April 2007. Phase two of the private placement resulted in repayment of
the $1,000,000 one-year bridge loan netting the Company $4,000,000 before
selling expense. In connection with the phase two debt offering, the Company
agreed to issue an additional 30,000,000 shares of its Common Stock. The Company
used the proceeds of the offering to commercialize its products, to build out
its 38,000 square foot facility in Vista, California, to increase it production
capacity, to hire additional personnel in sales, quality assurance/quality
control, accounting, and to fund operating deficits.

The Company anticipates being successful in raising the $6,000,000 in its
current private debt offering. However, there are no assurances that the Company
will successfully raise the $6,000,000 or the funds necessary to maintain
current operations.

See `Risk Factors' in Item 1 of this Report which are incorporated by reference
into this Item 6 in their entirety.

                                       12

<PAGE>

ITEM 7.  FINANCIAL STATEMENTS


                           JAVO BEVERAGE COMPANY, INC.
                          INDEX TO FINANCIAL STATEMENTS
                                DECEMBER 31, 2002

                                                                         PAGE

INDEPENDENT AUDITORS' REPORT                                               F-2

FINANCIAL STATEMENTS

         Balance Sheet                                                     F-3

         Statements of Operations                                          F-4

         Statements of Stockholders' Deficit                               F-5

         Statements of Cash Flows                                          F-9

         Notes of Financial Statements                                    F-10


                                      F-1

<PAGE>

                          INDEPENDENT AUDITORS' REPORT


Board of Directors
Javo Beverage Company, Inc.

We have audited the accompanying balance sheet of Javo Beverage Company, Inc.
(the "Company") as of December 31, 2002, and the related statements of
operations, stockholders' deficit, and cash flows for each of the two years then
ended. 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 auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit 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 Javo Beverage Company, Inc. as
of December 31, 2002 and the results of its operations and its cash flows for
each of the two years then ended, 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 Note 3 to the
financial statements, the Company has suffered recurring losses from operations
and has a working capital deficit at December 31, 2002 that raise substantial
doubt about its ability to continue as a going concern. Management's plans in
regard to these matters are also described in Note 3. The financial statements
do not include any adjustments that might result from the outcome of this
uncertainty.



                                                                Hurley & Company

Granada Hills, California
March 26, 2003

                                      F-2

<PAGE>

<TABLE>
                                JAVO BEVERAGE COMPANY, INC.
                                       BALANCE SHEET
                                     DECEMBER 31, 2002
<CAPTION>

ASSETS
------

<S>                                                                          <C>
CURRENT ASSETS:
  Cash and cash equivalents                                                  $    724,003
  Accounts receivable, net of allowance for doubtful accounts of $12,072           61,728
  Employee advances                                                                13,557
  Inventory, net of reserve for obsolescence of $50,000                           150,000
  Prepaid expenses                                                                  5,127
                                                                             -------------
     Total current assets                                                         954,415

PROPERTY AND EQUIPMENT, NET                                                       609,288

OTHER ASSETS
  Deposits                                                                         52,837
  Loan fee, net of accumulated amortization of $71,944                            428,056
                                                                             -------------
     Total other assets                                                           480,893
                                                                             -------------
     Total assets                                                            $  2,044,596
                                                                             =============

LIABILITIES AND STOCKHOLDERS' DEFICIT
-------------------------------------

CURRENT LIABILITIES:

  Accounts payable and accrued expenses                                      $    361,210
  Accrued payroll and related benefits                                             31,929
  Other current liabilities                                                        24,809
                                                                             -------------
     Total current liabilities                                                    417,948
                                                                             -------------

Long-term debt                                                                  5,000,000
Discount on long-term debt                                                     (2,046,667)
Other long-term debt                                                              300,000
                                                                             -------------
     Net long-term debt                                                         3,253,333

Accrued long-term interest payable                                                368,056

Commitments and contingencies                                                          --
                                                                             -------------
     Total liabilities                                                          4,039,337
                                                                             -------------

STOCKHOLDERS' DEFICIT:

Common stock, $0.001 par value, 150,000,000 shares authorized,
    139,321,434 shares issued and outstanding                                     139,321
Additional paid in capital                                                     14,935,258
Warrants outstanding                                                              304,364
Stock subscription receivable - officer                                          (510,000)
Accumulated deficit                                                           (16,863,684)
                                                                             -------------
     Total stockholders' deficit                                               (1,994,741)
                                                                             -------------
     Total liabilities and stockholders' deficit                             $  2,044,596
                                                                             =============

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

                                           F-3
</TABLE>

<PAGE>
<TABLE>
                                      JAVO BEVERAGE COMPANY, INC.
                                       STATEMENTS OF OPERATIONS
                            FOR THE YEARS ENDED DECEMBER 31, 2002 AND 2001
<CAPTION>

                                                                          2002               2001
                                                                     --------------     --------------
<S>                                                                  <C>                <C>
Net sales                                                            $     605,655      $     148,528

Cost of sales                                                              635,573            193,064
                                                                     --------------     --------------
     Gross loss                                                            (29,918)           (44,536)

Operating expenses:
  Research and development                                                 964,836            313,259
  Selling and marketing                                                  1,061,988            787,524
  General and administrative                                             2,088,372            893,633
                                                                     --------------     --------------

     Total operating expenses                                            4,115,196          1,994,416
                                                                     --------------     --------------

     Loss from operations                                               (4,145,114)        (2,038,952)
                                                                     --------------     --------------

Other income (expenses):
  Loan fee                                                              (1,125,000)                --
  Interest expense                                                        (789,795)                --
  Interest income                                                           42,267             28,931
                                                                     --------------     --------------

     Total other income (expense)                                       (1,872,528)            28,931
                                                                     --------------     --------------

     Net loss                                                        $  (6,017,642)     $  (2,010,021)
                                                                     ==============     ==============

Basic and diluted loss per share                                     $       (0.05)     $       (0.05)
                                                                     ==============     ==============

Weighted average number of shares outstanding, basic and diluted       130,553,290         42,866,170
                                                                     ==============     ==============

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

                                                 F-4
</TABLE>

<PAGE>
<TABLE>
                                                     JAVO BEVERAGE COMPANY, INC.
                                                 STATEMENTS OF STOCKHOLDERS' DEFICIT
                                           FOR THE YEARS ENDED DECEMBER 31, 2002 AND 2001
<CAPTION>

                                                                   Additional
                                                Common Stock         Paid-in    Accumulated     Warrants   Subscription
                                            Shares        Amount     Capital      Deficit     Outstanding   Receivable      Total
<S>                                       <C>         <C>          <C>          <C>           <C>         <C>           <C>
Balances at January 1, 2001               35,381,002  $    35,381  $ 9,440,072  $(8,836,021)  $       --  $(1,055,000)  $  (415,568)

Stock issued during 2001 in a private
 placement at $0.04 per share              3,086,250        3,086      120,364           --           --           --       123,450

Stock issued in during 2001 in a
 private placement at $0.05 per share        490,909          491       24,509           --           --           --        25,000

Stock issued during 2001 in a private
 placement at $0.07 per share              1,400,002        1,400      103,600           --           --           --       105,000

Stock issued during 2001 in a private
 placement at $0.08 per share              1,047,499        1,047       77,953           --           --           --        79,000

Stock issued during 2001 in a private
 placement at $0.10 per share              1,600,000        1,600      158,400           --           --           --       160,000

Stock issued during 2001 in a private
 placement at $0.15 per share                111,634          112       16,633           --           --           --        16,745

Stock issued during 2001 in a private
 placement at $0.19 per share                  5,263            5          995           --           --           --         1,000

Stock issued during 2001 at $0.01 per
 share for consulting services
 rendered, including expense recognized
 for issuance of stock at less than fair
 value of $0.06 per share                  1,350,000        1,350       83,025           --           --           --        84,375

Stock issued during 2001 at $0.02 per
 share for consulting services rendered,
 including expense recognized for issuance
 of stock at less than fair value of $0.05
 per share                                   312,500          313       16,236           --           --           --        16,549

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

                                                                F-5
</TABLE>

<PAGE>
<TABLE>
                                                     JAVO BEVERAGE COMPANY, INC.
                                                 STATEMENTS OF STOCKHOLDERS' DEFICIT
                                           FOR THE YEARS ENDED DECEMBER 31, 2002 AND 2001
<CAPTION>

                                                                     Additional
                                                 Common Stock          Paid-in    Accumulated     Warrants   Subscription
                                              Shares        Amount     Capital      Deficit     Outstanding   Receivable     Total
<S>                                           <C>         <C>          <C>          <C>          <C>          <C>           <C>
Stock issued during 2001 at $0.04 per
 share for consulting services
 rendered, including expense recognized
 for issuance of stock at less than
 fair value of $0.06 per share                235,767     $    236     $ 13,044     $     --     $     --     $     --      $ 13,280

Stock issued during 2001 at $0.05 per
 share for consulting services
 rendered, including expense recognized
 for issuance of stock at less than
 fair value of $0.07 per share                271,455          271       18,731           --           --           --        19,002

Stock issued March 2001 at $0.08 per
 share (fair value) for consulting
 services                                     450,000          450       35,550           --           --           --        36,000

Stock issued during 2001 at $0.10 per
 share for consulting services
 rendered, including expense recognized
 for issuance of stock at less than
 fair value of $0.13 per share                401,810          402       53,079           --           --           --        53,481

Stock issued in January 2001 at $0.17
 per share for consulting services
 rendered, including expense recognized
 for issuance of stock at less
 than fair value of $0.25 per share            70,000           70       17,430           --           --           --        17,500

Stock issued February 2001 at $0.14 per
 share (fair value) for prior accrued
 consulting services                           25,000           25        3,525           --           --           --         3,550

Stock issued March 2001 at $0.08 per
 share (fair value) for prior accrued
 consulting services                          200,000          200       15,800           --           --           --        16,000

Shares issued in December 2001 in
 private placement at $0.04 per share
 under subscription agreement                 375,000          375       14,625           --           --      (15,000)           --

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

                                                                F-6
</TABLE>

<PAGE>
<TABLE>
                                                     JAVO BEVERAGE COMPANY, INC.
                                           STATEMENTS OF STOCKHOLDERS' DEFICIT (CONTINUED)
                                           FOR THE YEARS ENDED DECEMBER 31, 2002 AND 2001
<CAPTION>

                                                                     Additional
                                                   Common Stock        Paid-in   Accumulated    Warrants    Subscription
                                                Shares      Amount     Capital       Deficit    Outstanding   Receivable     Total
<S>                                               <C>      <C>      <C>            <C>            <C>     <C>           <C>
Shares issued in June 2001 at $0.09 per
 share (fair value) in satisfaction of debt       192,357  $   192  $     13,273   $         --   $   --  $        --   $    13,465

Shares issued in September 2001 at $0.04
 per share (fair value) to officers and
 related parties for funds advanced to
 pay expenses                                   6,821,606    6,822       266,042             --       --           --       272,864

Shares issued in November 2001 at $0.04 per
 share (fair value) in satisfaction of debt        60,000       60         2,340             --       --           --         2,400

Shares issued in January 2001 at $0.13 per
 share (fair value) in satisfaction of debt        75,800       76         9,778             --       --           --         9,854

Shares issued in December 2001 at $0.03 per
 share in settlement of lawsuit, including
 expense recognized for issuance of stock at
 less than fair value of $0.06 per share          360,000      360        22,140             --       --           --        22,500

Shares issued in November 2001 at $0.04
 (fair value) in settlement of lawsuit            100,000      100         3,900             --       --           --         4,000

Cancellation of subscription note from
 former Officers                                       --       --            --             --       --       10,625        10,625

Net loss                                               --       --            --     (2,010,021)      --           --    (2,010,021)
                                               -----------  -------   -----------   ------------   ------  -----------   -----------
Balances at December 31, 2001                  54,423,854   54,424    10,531,044    (10,846,042)      --   (1,059,375)   (1,319,949)

Shares issued to employees in January
 2002 at $0.04 per share (fair value)
 for expenses                                  23,907,473   23,907       936,516             --       --           --       960,423

Shares issued to employees in January
 2002 at $0.04 per share (fair value)
 per employment agreements                     17,975,646   17,976       701,051             --       --           --       719,027

Shares issued for correction                        1,000        1            (1)            --       --           --            --

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

                                                                F-7
</TABLE>

<PAGE>
<TABLE>
                                                     JAVO BEVERAGE COMPANY, INC.
                                           STATEMENTS OF STOCKHOLDERS' DEFICIT (CONTINUED)
                                           FOR THE YEARS ENDED DECEMBER 31, 2002 AND 2001
<CAPTION>

                                                                   Additional
                                                 Common Stock        Paid-in      Accumulated     Warrants   Subscription
                                              Shares      Amount     Capital        Deficit     Outstanding   Receivable    Total
<S>                                       <C>           <C>         <C>            <C>            <C>       <C>         <C>
Shares issued at $0.075 per share in
 connection with loan payable              15,000,000   $  15,000   $  1,110,000   $         --   $     --  $      --   $ 1,125,000

Receipt of stock subscription cash                 --          --             --             --         --     15,000        15,000

Shares issued at $0.08 per share in
 connection with loan payable              30,000,000      30,000      2,370,000             --         --         --     2,400,000

Shares issued for services at $0.14
 per share                                     67,000          67          9,933             --         --         --        10,000

Shares issued to employees at $0.14
 per share                                    600,000         600         83,400             --         --         --        84,000

Shares cancelled per agreement with
  former executive                         (2,862,600)     (2,863)      (531,512)            --         --    534,375            --

Warrants issued at a strike price of
 $0.1875 per agreement with former
 executive                                         --          --       (304,364)            --    304,364         --            --

Shares issued at $0.17 per share to
 employees per employment agreements            5,000           5            845             --         --         --           850

Shares issued in August 2002 at $0.32
 per share for services                        41,561          42         13,258             --         --         --        13,300


Warrants exercised at $0.20 per share          12,500          12          2,488             --         --         --         2,500

Warrants exercised at $0.085 per share        150,000         150         12,600             --         --         --        12,750

Net loss                                           --          --             --     (6,017,642)        --         --    (6,017,642)
                                          ------------  ----------  -------------  -------------  --------- ----------  ------------
Balance at December 31, 2002              139,321,434   $ 139,321   $ 14,935,258   $(16,863,684)  $304,364  $(510,000)  $(1,994,741)
                                          ============  ==========  =============  =============  ========= ==========  ============

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

                                                                F-8
</TABLE>

<PAGE>
<TABLE>
                                          JAVO BEVERAGE COMPANY, INC.
                                            STATEMENTS OF CASH FLOWS
                                 FOR THE YEARS ENDED DECEMBER 31, 2002 AND 2001
<CAPTION>

                                                                                      2002             2001
<S>                                                                               <C>              <C>
Cash flows from operating activities:
  Net loss                                                                        $(6,017,642)     $(2,010,021)
  Adjustments to reconcile net loss to net cash used in operating activities:
    Depreciation and amortization                                                     523,235           37,345
    Issuance of common stock for services                                              23,300          310,645
    Issuance of common stock for compensation                                         803,877               --
    Issuance of common stock for loan fee                                           1,125,000
    Issuance of common stock to related parties for expenses paid                     960,423          272,264
    Interest expense paid with issuance of stock                                           --            1,311
    Changes in operating assets and liabilities:
      Accounts receivable                                                             (70,840)          (1,419)
      Inventory                                                                      (142,775)          (7,225)
      Other assets                                                                    (57,964)              --
      Accounts payable and accrued expenses                                          (529,974)         583,792
      Accrued payroll and related benefits                                           (373,658)         353,347
      Accrued interest payable                                                        368,056               --
      Other current liabilities                                                       (15,500)         (25,300)
                                                                                  ------------     ------------
      Net cash used in operating activities                                        (3,404,462)        (485,261)

Cash flows from investing activities:
  Purchases of property and equipment                                                (606,505)         (45,701)
                                                                                  ------------     ------------
      Net cash used in investing activities                                          (606,505)         (45,701)

Cash flows from financing activities:
  Proceeds from related party loans                                                        --           69,279
  Proceeds from long-term debt                                                      2,900,000               --
  Loan fee                                                                           (500,000)              --
  Payments on related party loans                                                     (95,280)         (48,546)
  Payment received on stock subscription                                               15,000               --
  Issuance of stock for cash                                                        2,415,250          510,195
                                                                                  ------------     ------------

      Net cash provided by financing activities                                     4,734,970          530,928

      Net change in cash and cash equivalents                                         724,003              (34)

      Cash and cash equivalents at beginning of period                                     --               34
                                                                                  ------------     ------------

      Cash and cash equivalents at end of period                                  $   724,003      $        --
                                                                                  ============     ============

Non cash financing activities:
      Stock issued in satisfaction of debt                                                 --      $    15,000
      Stock subscription note cancelled                                                    --          (10,625)
      Stock issued for subscription                                                        --           15,000

Supplemental cash flow information:
      Cash paid for interest                                                      $    68,156      $     1,424
      Cash paid for income taxes                                                        4,000               --

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

                                                      F-9
</TABLE>

<PAGE>

                           JAVO BEVERAGE COMPANY, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                DECEMBER 31, 2002

NOTE 1.  NATURE OF OPERATIONS

Organization
------------

Javo Beverage Company, Inc., formerly La Jolla Fresh Squeezed Coffee Company,
Inc., (the "Company") was incorporated in the state of Delaware on June 21,
2002. In 2002, the Company merged with La Jolla Fresh Squeezed Coffee Company,
Inc. ("LJCC"). LJCC was incorporated in the state of Washington on February 9,
1987. In 1998, the LJCC acquired the net assets of Stephen's Coffee Company,
Inc. ("SCC"). SCC was incorporated in the state of California on August 13,
1993. SCC was the operating company responsible for the development of
manufacturing methods and products for distribution. Effective November 1, 1998,
SCC was acquired for 1,142,500 shares of common stock representing approximately
9% of the outstanding voting stock of LJCC in exchange for the common stock of
SCC. The LJCC's sales during 2001 were primarily of a promotional nature as it
tried to find its niche in the marketplace. From August 13, 1993 to December 31,
2001, the Company was a development stage enterprise. After the merger of LJCC
into the Company, the Company exited the development stage as it began to
generate significant revenues.

Nature of Operations
--------------------

The Company is a technology-based manufacturer and marketer of coffee
concentrates, beverages and extracts for the food service and ingredient
markets. Its manufacturing plant and administrative offices are in Vista,
California, in the North San Diego County area. Many of the Company's customers
are in the Southern California area; however, the Company sells to customers
throughout the United States.

NOTE 2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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

The preparation of financial statements in conformity with U.S. generally
accepted accounting principles requires management to make 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, and the reported amounts of revenues and expenses during the
reporting periods. Actual results could materially differ from those estimates.

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

The Company purchases certain products from four suppliers, which accounted for
approximately 65% and 87% of total purchases in 2002 and 2001, respectively.
Management does not believe that the loss of these suppliers could have a severe
impact on the result of operations.

Revenue Recognition
-------------------

Revenue from coffee products is recognized upon shipment of product. Estimated
returns and allowances are accrued at the time of sale.

                                      F-10

<PAGE>

                           JAVO BEVERAGE COMPANY, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                DECEMBER 31, 2002

NOTE 2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Advertising costs
-----------------

Advertising and promotional costs are expensed as incurred. Advertising and
promotional expenses were $81,980 and $61,882 for the years ended December 31,
2002 and 2001, respectively.

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

Research and development costs are expensed as incurred.

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

The Company accounts for income taxes under the provisions of SFAS No. 109.
"Accounting for Income Taxes," whereby deferred tax assets and liabilities are
recognized for the future tax consequences attributable to temporary differences
between bases used for financial reporting and income tax purposes. Deferred tax
assets and liabilities are measured using enacted tax rates expected to apply to
taxable income in the years in which those temporary differences are expected to
be recovered or settled. A valuation allowance is provided for certain deferred
tax assets if it is more likely than not that the Company will not realize tax
assets through future operations.

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

The Company accounts for employee stock options using the intrinsic method
prescribed by Accounting Principles Board Option No. 25 ("APB 25") "Accounting
for Stock Issued to Employees." The Company makes pro forma disclosures of net
income and earnings per share as if the fair value method of accounting had been
applied in accordance with SFAS 123. The Company accounts for non-employee stock
options under the fair value method using the Black-Scholes model.

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

Basic EPS is computed as net income (loss) divided by the weighted average
number of common shares outstanding for the period. Diluted EPS reflects the
potential dilution that could occur from common stock issuable through stock
options, warrants and other convertible securities. The Company did not have any
potentially dilutive common stock equivalents as of December 31, 2002.

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

Cash and cash equivalents include cash on hand and on deposit and highly liquid
debt instruments with original maturities of three months or less.

Inventory
---------

Inventories consist principally of raw materials and finished goods and are
stated at the lower of cost (first-in, first-out method) or market.

                                      F-11

<PAGE>

                           JAVO BEVERAGE COMPANY, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                DECEMBER 31, 2002

NOTE 2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

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

Property and equipment are depreciated over their estimated useful lives using
the straight-line method over three to seven years. Additions are capitalized.
The cost of maintenance and repairs is charged to expense as incurred.

Fourth quarter adjustments
--------------------------

The Company made adjustments during the fourth quarter 2002 to better reflect
the matching of costs and benefits of the issuance of stock and debt. The net
effect of these adjustments was to reduce the Company's net loss by
approximately $4 million.

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

Certain prior year amounts in the accompanying financial statements have been
reclassified to conform to the current year's presentation.

NOTE 3.  BASIS OF PRESENTATION

During the two years ended December 31, 2002 and 2001, the Company had recurring
losses while trying to find its niche in the retail coffee market. The Company
exited the development stage at the end of 2001, but still has not developed
sufficient revenues to cover its operating expenses. The Company has working
capital of over $500,000, but a stockholder deficit of almost $2,000,000 and
losses from operations the last two years have been significant. As a result,
unless the Company is able to obtain additional financing and develop profitable
operations, there is substantial doubt as to the ability of the Company to
continue as a going concern.

Management's plans to become profitable involve expanding its sales force to
further introduce its products across the country. The Company has also begun
another private debt offering in order to raise funds to continue operations
while it attempts to generate revenues (see Note 12 below). The Company has
recently entered into agreements with a large global ingredient house to
exclusively represent the Company's products in the food ingredients industry,
and with one of the largest U.S. broadline distributors to distribute the
Company's products through its national system of distribution. Separately, the
Company has secured a national service agreement for its foodservice customers
with one of the industry's largest vendors.

It is not possible to predict the success of management's subsequent efforts to
achieve profitability. If management is unable to achieve its goals, the Company
may find it necessary to undertake other actions as may be appropriate if it is
to continue operations and meet its commitments.

The accompanying financial statements do not include any adjustments relating to
the recoverability and classification of the recorded asset amounts or the
amounts and classification of liabilities that might be necessary should the
Company be unable to continue in existence.

                                      F-12

<PAGE>

                           JAVO BEVERAGE COMPANY, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                DECEMBER 31, 2002

NOTE 4.  MAJOR CUSTOMERS

During the years ended December 31, 2002, the Company had sales to a major
customer, Yocream, which accounted for 86% of sales During 2001, it had sales to
two major customers; Key Essentials, which accounted for 39% of sales, and
Yocream, which accounted for 40% of the Company's sales.

NOTE 5.  INVENTORY

Inventory at December 31, 2002 consists of the following:

                  Raw materials                                  $ 119,612
                  Finished goods                                    80,388
                                                                 ----------
                                                                   200,000
                  Reserve for obsolescence                         (50,000)
                                                                 ----------
                                                                 $ 150,000
                                                                 ==========

NOTE 6.  PROPERTY AND EQUIPMENT

Property and equipment consists of the following at December 31, 2002:

                  Productions equipment                          $ 618,463
                  Office equipment                                  43,253
                  Leasehold improvements                            72,548
                                                                 ----------

                  Total cost                                       734,264

                  Less accumulated depreciation                   (124,976)
                                                                 ----------

                                                                 $ 609,288
                                                                 ==========

During the years ended December 31, 2002 and 2001, depreciation expense totaled
$97,958 and $37,345, respectively.

NOTE 7.  INTANGIBLE ASSETS

The Company recorded loan fees of $500,000 during 2002, which was a 10%
commission paid in connection with its $5 million private placement debt
offering (see Note 8 below). These fees are being amortized over the five-year
life of the loans. Amortization expense as of December 31, 2002 was $71,944, and
the estimated amortization expense for the next five fiscal years is as follows:

                  Year ending December 31, 2003                  $ 100,000
                  Year ending December 31, 2004                    100,000
                  Year ending December 31, 2005                    100,000
                  Year ending December 31, 2006                    100,000
                  Year ending December 31, 2007                     28,056
                                                                 ----------

                                                                 $ 428,056
                                                                 ==========

                                      F-13

<PAGE>

                           JAVO BEVERAGE COMPANY, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                DECEMBER 31, 2002

NOTE 8.  LONG-TERM DEBT

On February 8, 2002, the Company issued $1,000,000 in notes payable to private
investors as a bridge loan until funding for its $5,000,000 private placement
debt offering was completed on April 11, 2002. In connection with the bridge
loan, the Company paid 6% interest (totaling $10,192) and issued 15,000,000
shares of restricted common stock, valued at $1,125,000, to the note holders.
These note holders were also given a 5% discount on their notes payable,
totaling $50,000, which the Company recorded as interest expense.

On April 11, 2002, the Company issued $5,000,000 in promissory notes bearing 10%
interest per year, which mature on April 11, 2007. The proceeds of this funding
paid off the Bridge Loan discussed above and provided the Company with working
capital to begin operations.

In connection with these promissory notes, the Company issued 30,000,000 shares
of its restricted common stock and paid a 10% commission totaling $500,000 (see
Note 7 above) to the persons responsible for finding the note holders. As per
APBO No. 14, the Company determined that the note holders had bought the
30,000,000 shares of restricted common stock for $2,400,000 and had paid
$2,600,000 for the debt, based on the relative fair values of the respective
equity and debt instruments issued. Accordingly, a $2,400,000 debt discount was
recognized on the $5,000,000 principal value of the promissory notes, which is
being amortized over the five-year life of the debt. This makes the effective
interest rate on the notes approximately 25.8% over the life of the debt. At
December 31, 2002, $353,333 in interest expense was amortized and $368,056 in
interest expense (at the 10% coupon rate) was accrued on the notes.

On December 31, 2002, a $300,000 promissory note was issued bearing 10% interest
and maturing on December 31, 2007. In connection with this note, the Company
will issue 1,800,000 shares of its common stock in 2003.

NOTE 9.  COMMITMENTS AND CONTINGENCIES

Leases
------

The Company entered into a non-cancelable operating lease for its office space
in 2002. The lease expires in 2009. Total rent expense for all operating leases
for the years ended December 31, 2002 and 2001 amounted to approximately
$139,835 and $87,000, respectively.

The Company's future annual minimum lease payments as of December 31, 2002 are
as follows:

                                  YEARS ENDING

                  2003                                $   244,725
                  2004                                    252,066
                  2005                                    259,632
                  2006                                    267,420
                  2007                                    275,445
                  2008                                    283,704
                  2009                                    267,320
                                                      ------------
                                                      $ 1,850,312
                                                      ============

                                      F-14

<PAGE>

                           JAVO BEVERAGE COMPANY, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                DECEMBER 31, 2002

NOTE 9.  COMMITMENTS AND CONTINGENCIES (CONTINUED)

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

In December 2001, the Company entered into two agreements for consultants to
develop and implement a national sales effort for the Company's products
targeted at multi-unit retail operators. The agreements called for the Company
to pay the consultants a total of $300,000 over six months for overhead and
expenses. The agreements also called for the consultants to receive warrants,
upon the execution of the agreements, entitling them to purchase 500,000 shares
each of the Company's restricted common stock at $0.085 per share. The Company
recorded $250,000 in selling and marketing costs related to these agreements
during 2002. Of these warrants, 150,000 were exercised during 2002 and no
additional warrants were issued. These agreements were canceled by the Company
in late 2002 and revised agreements were negotiated in 2003.

Litigation
----------

In November 2001, two shareholders of the Company filed a claim against the
Company alleging that the Company failed to authorize the removal of a
restrictive legend on their stock certificates in a timely manner, preventing
the sale of the shares at a then higher trading price resulting in alleged
damages of approximately $30,000. The Company settled this claim for $8,000 in
July, 2002.

In connection with the Company's 2002 relocation to a new facility in Vista,
California, the Company engaged a consultant to design and implement certain
production room improvements. Certain portions of the improvements proved faulty
and the Company subsequently withheld the consultant's final payment of
approximately $8,000 while asking for the work to be redone. The consultant
declined to take responsibility for the work and filed suit against the Company
for breach of contract, money due on account and unjust enrichment totaling
$17,950. Management believes this claim to be without merit and intends to
vigorously defend against it. Counsel has not offered an opinion on this case.

Common Stock Issuances
----------------------

The Company issued 3,097,532 shares of restricted common stock for services
rendered in 2001. Services rendered consisted of financial consulting, legal and
business management consulting. The fair value was determined by management
based on the average trading ask prices on the OTC:BB in the month the
transaction was effected, less a discount of 10% for transferability
restrictions. The monthly average closing ask prices ranged from $0.05 per share
to $0.25 per share during the service periods. As result, the Company charged
operations $97,761 in connection with services during 2001.

                                      F-15

<PAGE>

                           JAVO BEVERAGE COMPANY, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                DECEMBER 31, 2002

NOTE 10. STOCK TRANSACTIONS

In June, 2001, the Company issued an additional 192,357 shares of restricted
common stock at $0.04 per share to a related party for the late issuance of the
original 94,643 shares issued in connection with the satisfaction of a debt.

In September, 2001, the Company issued 6,821,606 shares of restricted common
stock at $0.04 (fair value) to various officers and related parties in
satisfaction of expenses incurred and paid for on behalf of the Company. The
Company charged operations in the amount of $272,864 for these expenses.

In November, 2001, the Company issued 100,000 shares of restricted common stock
at $0.04 per share (fair value)in satisfaction of litigation. The Company
recognized a $4,000 settlement expense in 2001. Also in November, 2001, the
Company issued 60,000 shares of restricted common stock at $0.04 per share (fair
value) to a vendor in satisfaction of a payable.

In December, 2001, the Company issued 360,000 shares of restricted common stock
at $0.03 per share in satisfaction of litigation (see Note 4 above). The fair
value of the shares at the grant date was $0.06 per share. The Company recorded
an expense of $11,000 for the settlement and $11,500 for the difference between
the issue price and fair value.

During 2002, the Company issued 42,488,119 shares of restricted common stock at
prices ranging from $0.04 to $0.17 per share to employees for expenses incurred
on behalf of the Company and in conjunction with employment agreements entered
into during 2002. The shares issued in connection with the employment agreements
are subject to repurchase by the Company over a five-year period from the date
of the employment agreements at par value. As of December 31, 2002, the Company
had the right to repurchase 14,717,517 of the 18,655,646 shares issued to
employees, and had repurchased 450,000 shares during the year.

In February, 2002, the Company issued 15,000,000 shares of restricted common
stock at $0.075 per share in connection with a bridge loan from private
investors (see Note 8 above).

In April, 2002, the Company issued 30,000,000 shares of restricted common stock
at $0.08 per share in connection with promissory notes held by private investors
(see Note 8 above).

During 2002, the Company issued 109,561 shares of restricted common stock at
prices ranging from $0.14 to $0.32 per share for services rendered during 2002.

In June, 2002, a former executive of the Company returned 2,862,600 shares of
restricted common stock for 2,925,100 warrants at $0.1875 (expiring in June,
2005) and canceling a subscription note receivable of $534,375. Using the Black
Scholes method of calculating fair value, the warrants were recorded at a value
of $304,364.

In October, 2002, 162,500 warrants were exercised for 162,500 shares of
restricted common stock at prices ranging from $0.085 to $0.20 for aggregate
proceeds of $15,250.

                                      F-16

<PAGE>

                           JAVO BEVERAGE COMPANY, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                DECEMBER 31, 2002

NOTE 10. STOCK TRANSACTIONS (CONTINUED)

Incentive Stock Plans
---------------------

In 1999, the Board of Directors adopted the 1999 Incentive Stock Option Plan
(the "Plan"), which authorizes the granting of options to key employees,
directors, and/or consultants to purchase 10,000,000 shares of unissued common
stock. During 1999, options to purchase 3,400,000 and 1,600,000 shares of the
Company's common stock were granted to two officers, respectively, and
immediately exercised at $0.15 per share. Options to purchase 3,400,000 shares
were exercised for employment services rendered. The Company recorded
compensation expense during 1999 of $680,000 for the value of these options
granted below fair value based on the difference between the estimated fair
value of $0.35 and the exercise price of $0.15 per share. In connection with the
exercise of options to purchase 3,400,000 shares, a promissory note bearing
interest at six (6) percent, per annum and due in 2009 was issued to the
Company. No payments have been received on the note.

On February 18, 2000, the board of directors and stockholders adopted the 2000
Incentive Stock Plan (the "2000 Plan"), which authorizes the granting of options
to key employees, directors, and/or consultants to purchase 10,000,000 shares of
unissued common stock. On February 18, 2000, the board of directors approved an
aggregate of 4,550,000 shares of the Company's common stock to three officers
for $0.1875 per share. None of the approved shares were purchased.

No options, or shares related to previously issued options, were issued or
exercised during 2001.

NOTE 11. PROVISION FOR INCOME TAXES

         The Company's deferred tax assets consist of the following:

<TABLE>
<CAPTION>
                                                                     2002              2001
<S>                                                             <C>               <C>
         Net operating loss carryforward                        $ 17,000,000      $ 10,000,000
                                                                =============     =============

         Calculated deferred tax benefit                        $  6,400,000      $  4,000,000
         Valuation allowance                                      (6,400,000)       (4,000,000)
                                                                -------------     -------------

         Deferred tax asset                                     $         --      $         --
                                                                =============     =============

         Provision for income tax benefits were as follows:

         Tax benefit, calculated at statutory rate              $ (2,400,000)     $   (480,000)
         Increase in valuation allowance                           2,400,000           480,000
                                                                -------------     -------------

                                                                $         --      $         --
                                                                =============     =============
</TABLE>

As a result of changes in ownership, the Company's use of net operating loss
carryforwards may be limited by section 382 of the Internal Revenue Code until
such net operating loss carryforwards expire. Deferred tax assets have been
computed using the maximum expiration terms of 20 and 5 years for federal and
state tax purposes, respectively.

                                      F-17

<PAGE>

                           JAVO BEVERAGE COMPANY, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                DECEMBER 31, 2002

NOTE 12. SUBSEQUENT EVENTS

In March and April, 2003, certain key employees of the Company returned 36
million shares of restricted common stock to enable the Company to fulfill the
terms of a $6,000,000 private placement debt offering. As of April 11, 2003, 21
units (totaling $525,000) had been purchased.


                                      F-18

<PAGE>

                                    PART III


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

CODY C. ASHWELL, 32
-------------------

Cody C. Ashwell, 32, is the Chairman and Chief Executive Officer of Javo
Beverage Company. Mr. Ashwell has served as the Company's CEO and Chairman since
September 4, 2001, acted as a consultant to the Company prior to that, and has
held a major stake in the Company since 1998. Prior to joining Javo, Mr. Ashwell
was managing partner of Ashwell, Marshall & Associates, a financial services and
consulting firm specializing in financial and management solutions for small-cap
companies. Prior to this, he was the founder and principal of a successful
financial and insurance services firm, which was later sold to the Allstate
Insurance Corporation.

GARY LILLIAN, 46
----------------

Gary A. Lillian is Javo Beverage Company's President, responsible for the
company's commercial strategy and the development of key industry alliances.
Prior to becoming Javo's President in January of 2002, Mr. Lillian held
executive level sales and marketing positions at consumer products companies
including PepsiCo, Ford Motor Company, Pennzoil-Quaker State and The Clorox
Company. In those positions, Lillian directed multimillion-dollar marketing and
turn-around efforts with highly profitable results. He also founded start-up
companies, including a beverage company and a packaged food company, which was
later sold to Nestle. Lillian earned a bachelor's and a master's degree in
business administration from Northwestern University.

STEPHEN F. COREY, 47
--------------------

Stephen F. Corey is the founder of Javo Beverage Company. Mr. Corey serves as a
director for the Company and currently holds the position of senior vice
president responsible for research and development and supervision of Javo's
product development programs. Mr. Corey served as the Company's corporate
secretary until March 26, 2002. Mr. Corey performed years of scientific research
on coffee varieties and coffee processing systems, extraction processes, blend
creation, equipment design, and product stabilization to create Javo's
proprietary brewing technology. His experience has allowed him to tailor the
company's products to have broad commercial appeal. Corey studied chemistry,
physics and engineering at the College of Idaho.

RICHARD A. GARTRELL, 54
-----------------------

Richard A. Gartrell has served as Javo's chief financial officer since the fall
of 2001 and acted as a consultant to the Company for 2 years prior to that. A
certified public accountant with more than 28 years of accounting experience,
Mr. Gartrell has acted successfully in the position of chief financial officer
at several mid-cap companies, most recently, AMX Resorts, Inc. Mr. Gartrell is
qualified as an expert witness in forensic accounting and holds a bachelor of
science degree in accounting from Colorado State University.

WILLIAM E. MARSHALL, 32
-----------------------

William E. Marshall is Javo Beverage Company's Executive Vice President and
General Counsel and, since March, 2002, the Company's corporate secretary. Prior
to becoming general counsel in January of 2002, Mr. Marshall served as the
Company's Chief Administrative Officer. Mr. Marshall became an Executive Vice
President on September 3, 2002. Prior to joining Javo Beverage Company in the
summer of 2001, he was a partner in Ashwell, Marshall & Associates, a financial
services and consulting firm specializing in small-cap companies A member of the
California State Bar, Marshall earned his juris doctor from the University of
California at Los Angeles. He completed his undergraduate studies at the
University of California at Santa Barbara.

None of our directors serves as a director of any other reporting company. There
are no family relationships among our directors or executive officers. None of
our directors has received compensation for services rendered as a director.

Javo's board of directors has determined that it does not have an audit
committee financial expert serving on its audit committee. Javo has not added an
audit committee financial expert to its board as yet, although it has looked for
candidates.

                                       13

<PAGE>

Javo has not adopted a formal, written code of ethics that applies to its
principal executive officer, principal financial officer, principal accounting
officer or controller, or persons performing similar functions. Javo has not
done so due to time constraints of its management team.


ITEM 10. EXECUTIVE COMPENSATION

The following table shows the compensation paid over the past three fiscal years
with respect to the Company's officers as of the end of the 2002 fiscal year. No
other officers or directors received an annual salary or bonus exceeding
$100,000.

<TABLE>
<CAPTION>
                                         Summary Compensation Table
____________   _________   _________   _________   _________   _____________   _________   _________   _________

                                                                              Long Term Compensation
____________   _________   _________   _________   _________   _____________   _________   _________   _________

                                  Annual Compensation                      Awards                Payouts
____________   _________   _________   _________   _________   _____________   _________   _________   _________

                  (b)         (c)         (d)         (e)           (f)           (g)         (h)         (i)
____________   _________   _________   _________   _________   _____________   _________   _________   _________

                                                    Other                     Securities                 All
   Name &                                           Annual      Restricted    Underlying               Other
  Principal                Salary ($)  Bonus ($)   Compensa       Stock        Options/      LTIP      Compen-
  Position        Year                               tion        Award(s)      SARs(#)    Payouts($)  sation($)
____________   _________   _________   ________   _________   _____________   _________   _________   _________
<S>               <C>       <C>          <C>        <C>          <C>             <C>        <C>        <C>
    CEO &         2002      182,500
 Director,        2001      None         None       None         Note (3)        None       None       Note (4)
Cody Ashwell
____________   _________   _________   _________   _________   _____________   _________   _________   _________

  President       2002      144,000      None       None         Note (4)        None       None       Note (4)
Gary Lillian
____________   _________   _________   _________   _________   _____________   _________   _________   _________

     CFO          2002      144,000      None       None         Note (5)        None       None       Note (4)
Rich Gartrell
____________   _________   _________   _________   _________   _____________   _________   _________   _________

   EVP &          2002     $126,000      None       None         Note (6)        None       None       None
 Director,
William Marshall
____________   _________   _________   _________   _________   _____________   _________   _________   _________

   SVP &          2002     $156,200      None       None         None            None        None      None
  Director        2001     $ 41,850      None       None         Note (1)        None        None      None
Stephen Corey     2000     $ 32,338      None       None         None            None        None      None
                  1999     $  9,904      None       None         None            None        None      None
____________   _________   _________   _________   _________   _____________   _________   _________   _________

Former CEO &      2001     $ 26,188      None       None         425,000         None        None      None
   former         2000     $ 46,600      None       None         Note (2)        None        None      None
  Director,       1999     $ 28,287      None       None         None            None        None      None
 Kurt Toneys
___________   _________   _________   _________   _________   _____________   _________   _________   _________
</TABLE>

Note (1) Stephen Corey received 2,121,654 shares of restricted Common Stock in
         September 2001 as payment for past salaries and benefits accrued but
         unpaid in the amount of $84,866. In addition, in January 2002 Mr. Corey
         was issued 3,040,646 shares of restricted Common Stock subject to
         forfeiture in accordance with the terms of his five-year employment
         agreement. In March and April 2003, Mr. Corey returned a total of
         5,500,000 shares of restricted Common Stock to the Company treasury.
         The shares returned to treasury included all the above-mentioned
         shares.

Note (2) Kurt Toneys purchased 2,850,000 shares of Common Stock in February
         2000 for $0.185 per share with two ten year promissory notes totaling
         $534,375 carrying interest at 6% per annum. In 2002, the Company agreed
         with Mr. Toneys to have him return to the Company 2,862,600 shares of
         restricted Common Stock in return for issuance of warrants for purchase
         3,013,000 shares of Common Stock at $0.1875 and the cancellation of the
         promissory notes totaling $534,375.

                                       14

<PAGE>

Note (3) Cody Ashwell received 2,842,975 shares of restricted Common Stock
         in September 2001 as payment for expenses paid on behalf of the Company
         in the amount of $113,719 in lieu of cash reimbursement. In January
         2002, Mr. Ashwell was issued 5,000,000 of restricted Common Stock
         subject to forfeiture in accordance with the terms of his five-year
         employment agreement. Also in January 2002, Mr. Ashwell was issued
         11,689,448 shares of restricted Common Stock in payment of amount owed
         him by the Company for expenses and past services. In March 2003, Mr.
         Ashwell returned a total of 13,500,000 shares of the above-mentioned
         restricted Common Stock to the Company treasury.

Note (4) In January 2002, Mr. Lillian was issued 4,900,000 of restricted
         Common Stock subject to forfeiture in accordance with the terms of his
         five-year employment agreement. Also in January 2002, Mr. Lillian was
         issued 2,600,000 shares of restricted Common Stock in payment of amount
         owed him by the Company for expenses and past services. In March 2003,
         Mr. Lillian returned a total of 6,500,000 shares of the above mentioned
         restricted Common Stock to the Company treasury.

Note (5) In January 2002, Mr. Gartrell was issued 3,500,000 of restricted
         Common Stock subject to forfeiture in accordance with the terms of his
         five-year employment agreement. Also in January 2002, Mr. Gartrell was
         issued 3,000,000 shares of restricted Common Stock in payment of amount
         owed him by the Company for expense and services. In March 2003, Mr.
         Gartrell returned a total of 5,500,000 shares of the above-mentioned
         restricted Common Stock to the Company treasury.

Note (6) William Marshall received 1,606,975 shares of restricted Common
         Stock in September 2001 as repayment for expenses paid on behalf of the
         Company in the amount of $64,279 in lieu of cash reimbursement. In
         January 2002, Mr. Marshal was issued 1,000,000 of restricted Common
         Stock subject to forfeiture in accordance with the terms of his
         five-year employment agreement. Also in January 2002, Mr. Marshall was
         issued 4,893,025 shares of restricted Common Stock in payment of amount
         owed him by the Company for loans, expenses and services. In March
         2003, Mr. Marshall returned a total of 5,000,000 shares of the
         above-mentioned restricted Common Stock to the Company treasury.

                                       15

<PAGE>

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth as of December 31, 2002, information concerning
ownership of the Company's Common Stock by each person known by the Company to
own beneficially more than 5% of its outstanding Common Stock, each director or
executive officer and all officers and directors as a group.

The following table sets forth as of December 31, 2002, information with respect
to the shares of Common Stock beneficially ownership of Directors and Executive
Officers of the Company:

<TABLE>
<CAPTION>
               (1)                            (2)                                (3)                         (4)
                                Name and Address of Beneficial          Amount and Nature of
         Title of Class                      owner                        Beneficial Owner            Percent of Class
<S>    <C>                    <C>                                              <C>                          <C>
       Common Stock           Cody Ashwell, San Diego, CA                      25,004,027                   17.9%
       Common Stock           Gary Lillian, San Diego, CA                       7,500,000                    5.4%
       Common Stock           Stephen Corey, La Jolla, CA                       7,233,334                    5.2%
       Common Stock           Richard A. Gartrell, Irvine, CA                   7,500,002                    5.4%
       Common Stock            William Marshall, San Diego, CA                  7,500,300                    5.4%
       All Officers and
       Directors as a group                                                    54,737,661                   39.3%
</TABLE>

It should be noted that as a group the above shareholders at the end of March
and in April of 2003 contributed 36,000,000 shares of Common Stock listed above
to the Company to facilitate a current private placement offering. The
employment agreements of the contributing members of management are to be
amended in light of these contributions. These contributions reduced the
ownership of the above individuals to a total of 13.5% of the shares outstanding
as of December 31, 2002.

<TABLE>
EQUITY COMPENSATION PLAN INFORMATION
<CAPTION>

                                             NUMBER OF SHARES TO BE      WEIGHTED AVERAGE           NUMBER OF SHARES
                                             ISSUED UPON EXERCISE OF     EXERCISE PRICE OF          REMAINING AVAILABLE FOR
                                             OUTSTANDING OPTIONS,        OUTSTANDING OPTIONS        FUTURE ISSUANCE UNDER
                                             WARRANTS, AND RIGHTS        WARRANTS AND RIGHTS        EQUITY COMPENSATION PLANS
                                                                                                    (1)
<S>                                          <C>                         <C>                        <C>
Equity compensation plans approved by        0                           --                         0
shareholders
Equity compensation plans not approved by    4,775,100(2)(3)             --                         0
shareholders
Total
</TABLE>

(1)      Excludes number of shares to be issued upon exercise of outstanding
         options.
(2)      1,850,000 of these warrants relate to compensation to consultants. Of
         these, 1,000,000 are reserves for warrants that could potentially be
         but have not yet been earned and issued pursuant to agreements with the
         consultants based on consultants' attaining certain performance
         objectives. The remaining 2,925,100 warrants were issued pursuant to a
         restructuring and settlement of prior compensation issues with former
         officer of the Company, Kurt Toneys. See Item 12 herein for further
         details.
(3)      No formal equity compensation plan exists at Javo Beverage Company,
         Inc. for current or future employees at this time. Javo has in the
         past, as a part of employee compensation, issued negotiated amounts of
         Common Stock to certain employees pursuant to employment agreements
         providing that all or most all of the shares are subject to a right of
         the Company to cancel the shares. This right of cancellation lapses or
         expires as to portions of these shares according to a vesting schedule
         thereby resulting in the issued shares vesting in the employee per the
         schedule. Other issuances to consultants for services have been made.
         See Item 5 herein generally for further details regarding these and
         other compensation-related issuances.

                                       16

<PAGE>

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

On February 18, 2000, Mr. Kurt Toneys, then director and executive officer,
purchased 2,850,000 shares of our Common Stock for $0.1875 per share by
executing two promissory notes totaling $534,375, bearing interest at six
percent per annum and due in February 2009. Mr. Toneys left the Company in
August 2001. In June of 2002, the Company entered into an agreement with Mr.
Toneys settling all matters relating to Mr. Toneys compensation and
reimbursements and the promissory notes including interest owed. Mr. Toneys
surrendered 1,750,100 of the 2,212,500 shares of Common Stock he held subject to
the note and retained 462,400 shares. The Company issued Mr. Toneys 2,925,100
three-year warrants at a strike price equal to his original purchase price of
18.75 cents per share, extinguished the promissory notes, and paid him $35,000
in cash.


ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K

         (a)      The list of exhibits is incorporated herein by reference to
                  the Exhibit Index attached after the signature page hereto.
         (b)      On December 11, 2002, the Company reported on Form 8-K under
                  Item 5 that the Company planned a private placement of
                  securities.


ITEM 14. CONTROLS AND PROCEDURES

Within the 90 days prior to the date of this report, the Company carried out an
evaluation, under the supervision and with the participation of the Company's
management, including the Company's Chief Executive Officer and Chief Financial
Officer, of the effectiveness of the design and operation of the Company's
disclosure controls and procedures (as defined in Rule 13a-14(c) of the
Securities Exchange Act of 1934). Based upon that evaluation, the Chief
Executive Officer and Chief Financial Officer concluded that the Company's
disclosure controls and procedures are effective in timely alerting them to
material information required to be included in the Company's periodic filings
with the Commission. There have been no significant changes in the Company's
internal controls or in other factors that could significantly affect these
internal controls subsequent to the date of their most recent evaluation. Since
there were no significant deficiencies or material weaknesses identified in the
Company's internal controls, the Company did not take any corrective actions.


ITEM 15. PRINCIPAL ACCOUNTANT FEES AND SERVICES

AUDIT FEES

The aggregate fees billed for each of the last two fiscal years for professional
services rendered by the principal accountant for the audit of the registrant's
annual financial statements and review of financial statements included in the
registrant's Form 10-QSB (17 CFR 249.308b) or services that are normally
provided by the accountant in connection with statutory and regulatory filings
or engagements for those fiscal years are $16,595 for fiscal year 2001 and
$5,000 to date for fiscal years 2002. Additional billing amounts are anticipated
for 2002 audit.

AUDIT-RELATED FEES

Other than amounts included as set forth above, there were no other fees billed
in each of the last two fiscal years for assurance and related services by the
principal accountant that are reasonably related to the performance of the audit
or review of the registrant's financial statements.

TAX FEES

There were $8,150 fees in total billed and paid in the last two fiscal years for
professional services rendered by the Company's tax accountant for tax
compliance, tax advice, and tax planning. The tax accountants are independent of
the Company auditors.

                                       17

<PAGE>

ALL OTHER FEES

There were no fees billed in each of the last two fiscal years for products and
services provided by the principal accountant, other than the services reported
above.

Our entire Board acts as the Audit Committee, and has not adopted pre-approval
policies and procedures described in paragraph (c)(7)(i) of Rule 2-01 of
Regulation S-X.

None of the services described above were approved by the audit committee
pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.

One hundred percent of the hours expended on the principal accountant's
engagement to audit the registrant's financial statements for the most recent
fiscal year was attributed to work performed by the principal accountant's
full-time, permanent employees.

                                       18

<PAGE>

CERTIFICATIONS

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

I, Cody C. Ashwell, certify that:

1. I have reviewed this annual report on Form 10-KSB of Javo Beverage Company,
Inc.;

2. Based on my knowledge, this annual 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 annual
report;

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

4. The registrant's other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

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

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

       c) presented in this annual report our conclusions about the
          effectiveness of the disclosure controls and procedures
          based on our evaluation as of the Evaluation Date;

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

       a) all significant deficiencies in the design or operation of internal
          controls which could adversely affect the registrant's ability to
          record, process, summarize, and report financial data and have
          identified for the registrant'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 registrant's internal
          controls; and

6. The registrant's other certifying officer and I have indicated in this annual
report whether or not there were significant changes in internal controls or in
other factors that could significantly affect internal controls subsequent to
the date of our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weaknesses.


                                                       /s/ CODY C. ASHWELL
                                                       -------------------------
                                                       Cody C. Ashwell
                                                       Chief Executive Officer
                                                       and Chairman of the Board

Dated: April 15, 2003

                                       19

<PAGE>

CERTIFICATION OF CHIEF FINANCIAL OFFICER

I, Richard A. Gartrell, certify that:

1. I have reviewed this annual report on Form 10-KSB of Javo Beverage Company,
Inc.;

2. Based on my knowledge, this annual 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 annual
report;

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

4. The registrant's other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

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

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

       c) presented in this annual report our conclusions about the
          effectiveness of the disclosure controls and procedures
          based on our evaluation as of the Evaluation Date;

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

       a) all significant deficiencies in the design or operation of internal
          controls which could adversely affect the registrant's ability to
          record, process, summarize, and report financial data and have
          identified for the registrant'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 registrant's internal
          controls; and

6. The registrant's other certifying officer and I have indicated in this annual
report whether or not there were significant changes in internal controls or in
other factors that could significantly affect internal controls subsequent to
the date of our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weaknesses.


                                                     /s/ RICHARD A. GARTRELL
                                                     -----------------------
                                                     Richard A. Gartrell
                                                     Chief Financial Officer

Dated: April 15, 2003

                                       20

<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned in the City of San Diego, California, on April 15, 2003.


                                                  Javo Beverage Company, Inc.,
                                                  a Delaware corporation

                                                  By:   /s/ Cody C. Ashwell
                                                      -------------------------
                                                           Cody C. Ashwell
 Its: Chairman and Chief Executive Officer

                                       21

<PAGE>

EXHIBIT INDEX

         2.1      Agreement and Plan of Merger between La Jolla Fresh Squeezed
                  Coffee Co., Inc. and Javo Beverage Company, Inc.(1).

         3.1      Certificate of Incorporation (1).

         3.2      Bylaws (1).

         4.1      Shareholder Rights Agreement by and between the Company and
                  Corporate Stock Transfer, Inc. as Rights Agent (1).

         10.1*    Executive Employment Contract between the Company and Cody
                  Ashwell (2)

         10.2*    Executive Employment Contract between the Company and Gary
                  Lillian (2)

         10.3*    Executive Employment Contract between the Company and Richard
                  Gartrell (2)

         10.4*    Executive Employment Contract between the Company and William
                  Marshall (2)

         10.5*    Executive Employment Contract between the Company and Stephen
                  Corey (2)

         10.6     Net Industrial Lease (Facility Lease) dated August 12, 2002
                  between the Company and Square One Partners (3)

         11       Statement re earnings per share - included in this 10-KSB's
                  financial statements

         16       Letter on Change in Certifying Accountant (4)

         99.1     Certifications

____________
* Indicates a management compensatory plan or arrangement.

(1)      Incorporated by reference to the Registrant's current report on Form
         14A filed with the Commission on August 19, 2002.

(2)      Incorporated by reference to the Registrant's annual report on Form
         10-KSB filed with the Commission on April 16, 2002.

(3)      Incorporated by reference to the Registrant's annual report on Form
         10-QSB filed with the Commission on August 15, 2002.

(4)      Incorporated by reference to the Registrant's current report on Form
         8-K filed with the Commission on February 1, 2001.

                                       22