Edgar Filing: BGR CORP

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 June 30, 2003

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

For the Transition Period from __________ to __________

Commission File Number 000-26887

BGR Corporation
(Name of small business issuer in its charter)

Nevada 98-0353403
(State or other jurisdiction of (I.R.S. employer identification number)
incorporation or organization)

7263 E. San Alfredo Drive, Scottsdale, AZ 85258
(Address of principal executive offices) (Zip code)

Issuer's telephone number: (480) 596-4014

Securities Registered Pursuant to Section 12(b) of the Act: NONE

Title of each class Name of each exchange on which registered

Securities Registered Pursuant to Section 12(g) of the Act:

COMMON
(Title of class)

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

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

State issuer's revenues for its most recent fiscal year. $2,625

State the aggregate market value of the voting and non-voting common equity held
by non-affiliates computed by reference to the price at which the common equity
was sold, or the average bid and asked price of such common equity, as of June
30, 2003. (See definition of affiliate in Rule 12b-2 of the Exchange Act.) $.515

State the number of shares outstanding of each of the issuer's classes of common
equity, as of September 4, 2003. 34,573,800 shares.

DOCUMENTS INCORPORATED BY REFERENCE

If the following documents are incorporated by reference, briefly describe them
and identify the part of the Form 10-KSB (e.g., Part I, Part II, etc.) into
which the document is incorporated: (1) any annual report to security holders;
(2) any proxy or information statement; and (3) any prospectus filed pursuant to
Rule 424(b) or (c) of the Securities Act of 1933 ("Securities Act"). The listed
documents should be clearly described for identification purposes (e.g., annual
report to security holders for fiscal year ended December 24, 1990).

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

PART I.........................................................................3
ITEM 1. BUSINESS...........................................................3
ITEM 2. DESCRIPTION OF PROPERTY............................................6
ITEM 3. LEGAL PROCEEDINGS..................................................6
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS................6

PART II........................................................................6
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS...........6
ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION..........7
ITEM 7. FINANCIAL STATEMENTS...............................................8
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE...........................................9

PART III.......................................................................9
ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT..................9
ITEM 10. EXECUTIVE COMPENSATION............................................10
ITEM 11. SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN SECURITY HOLDERS.....11
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS....................12
ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K..................................12

SIGNATURES....................................................................13

FORWARD LOOKING STATEMENTS

This Annual Report contains forward-looking statements about the Company's
financial condition, and prospects that reflect management's assumptions and
beliefs based on information currently available. The Company can give no
assurance that the expectations indicated by such forward-looking statements
will be realized. If any assumptions should prove incorrect, or if any of the
risks and uncertainties underlying such expectations should materialize, BGR
Corporation's actual results may differ materially from those indicated by the
forward-looking statements.

The key factors that are not within the Company's control and that may have
a direct bearing on operating results include, but are not limited to, ability
to identify and merge with an operating entity, managements' ability to raise
capital in the future, the retention of key employees and changes in the
regulation of the public company.

There may be other risks and circumstances that management may be unable to
predict. When used in this Report, words such as, "BELIEVES," "EXPECTS,"
"INTENDS," "PLANS," "ANTICIPATES," "ESTIMATES" and similar expressions are
intended to identify and qualify forward-looking statements, although there may
be certain forward-looking statements not accompanied by such expressions.
However, the forward-looking statements contained herein are not covered by the
safe harbors created by Section 21E of the Securities Exchange Act of 1934.

PART I

ITEM 1. BUSINESS.

OVERVIEW AND HISTORY

The Company was formed as a Nevada corporation on July 6, 2001 under the
name Cortex Systems, Inc. They were originally a development stage company that
intended to establish memory clinics in several different locations in North
America. Unfortunately, the Company was unable to successfully execute its
business plan. In July of 2003, the Company changed its name to BGR Corporation.

Along with the name change came a new management and ownership team. The
intention of management is to acquire new innovative fast-casual restaurant
concepts, develop them into a profitable working design, and franchise them
across the country. The Corporation's partner, Global Restaurant Development
Company, is a professional restaurant designer, franchiser, and restaurant
management company where principles have extensive experience in the industry.

Global provides the following services:

a.) Complete Design and Lay-out of stores
b.) National rollout program
c.) National marketing and public relations program
d.) Franchise sales program
e.) Project management
f.) Real Estate
g.) Architecture
h.) Construction and Construction management
i.) New franchisee training program
j.) Complete operations department
k.) Website development

The Company is currently in discussions with several companies operating in
the fast casual food industry. It is the Company's intention to acquire these
companies as subsidiaries. With partner Global Restaurant Development Company,
the Company expects to aggressively rollout nationally the fast casual food
restaurant concepts within the coming year.

SUBSIDIARIES

The Company currently has no subsidiaries.

PROPRIETARY RIGHTS

The Company currently does not possess trademarks, patents, or copyrights,
in relation to their products and services. Policing unauthorized use of the
Company's proprietary and other intellectual property rights could, while
currently unlikely, could entail significant expenses. In addition, there can be
no assurance that third parties will not bring claims of copyright or trademark
infringement against the Company or claim that certain aspects of its processes
or features violates a patent they hold. There can be no assurance that third
parties will not claim that the Company has misappropriated their creative ideas
or formats or otherwise infringed upon their proprietary rights. Any claims of
infringement, with or without merit, could be time consuming to defend, result
in costly litigation, divert management attention, require the Company to enter
into costly royalty or licensing arrangements to prevent the Company from using
important technologies or methods, any of which could have a material adverse
effect on the Company's business, financial condition or operating results.

EMPLOYEES

The Company's officers and directors are currently the only employees as of
September 2003. The employees are currently not represented by a collective
bargaining agreement, and the Company believes that relations with its employees
are good. There are no known problems or issues regarding any former employees,
officers, or directors.

RISK FACTORS

The following discussion contains, in addition to historical information,
forward-looking statements that involve risks and uncertainties. The Company's
actual results could differ significantly from the results discussed in the
forward-looking statements. Factors that could cause or contribute to such
differences include, but are not limited to, those discussed below and in Item
6, "Management's Discussion and Analysis of Financial Condition or Plan of
Operation."

LIMITED OPERATING HISTORY

The Company was incorporated on July 6, 2001, with a principal business
objective of developing the companies that it had interests in with a view
towards enhancing their value as potential take-over targets or through taking
them public. It had a limited operating history on which to base an evaluation
for businesses and prospects. The Company's prospects must be considered in
light of the risks, expenses and difficulties frequently encountered by
companies in their early stage of development, particularly companies in
evolving markets. These risks include, but are not limited to, an evolving and
unpredictable business model, dependence on the growth in use of the products
and services provided, the acceptance of the products and services, the ability
to attract and retain a suitable user base, rapid technological change and the
management of growth. In view of the Company's business model and its limited
operating history, it is believed that period-to-period comparisons of the
operating results are not necessarily meaningful and should not be relied upon
as an indication of future performance.

UNPREDICTABILITY OF FUTURE REVENUES; POTENTIAL FLUCTUATIONS IN QUARTERLY
OPERATING RESULTS; SEASONALITY

As a result of the Company's limited operating history, it is unable to
accurately forecast future revenues, if any. The Company anticipates that it may
experience significant fluctuations in its future quarterly operating results
due to a variety of factors, many of which are outside its control. Factors that
may adversely affect the quarterly operating results include (i) the ability to
attract a new business model; (ii) the ability to upgrade and develop its

systems and infrastructure; and (iii) the amount and timing of operating costs
and capital expenditures relating to expansion of the Company's business,
operations and infrastructure.

Due to the foregoing factors, in one or more future quarters the Company's
operating results may fall below the expectations of securities analysts and
investors. In such event, the trading price of the Common Stock would likely be
materially adversely affected.

DEPENDENCE ON KEY PERSONNEL; NEED FOR ADDITIONAL PERSONNEL

The Company's performance is substantially dependent on the services and on
the performance of its officers and directors. The Company's performance also
depends on its ability to attract, hire, retain, and motivate its officers and
key employees. The loss of the services of any of the executive officers or
other key employees could have a material adverse effect on the Company's
business, prospects, financial condition, and results of operations. The Company
has not entered into long-term employment agreements with any of its key
personnel and currently has no "Key Man" life insurance policies. The Company's
future success may also depend on it ability to identify, attract, hire, train,
retain, and motivate other highly skilled technical, managerial, marketing, and
customer service personnel. Competition for such personnel is intense, and there
can be no assurance that the Company will be able to successfully attract,
assimilate, or retain sufficiently qualified personnel. The failure to attract
and retain the necessary technical, managerial, marketing, and customer service
personnel could have a material adverse effect on the Company's business,
prospects, financial condition, and results of operations.

ESTABLISHMENT OF AN OPERATING ENTITY

The Company believes that establishing and maintaining an operating entity
is a critical aspect of the Company's business model. The Company has not yet
developed an operating entity and if it fails to do so it could have a material
adverse impact on its business. Promotion and enhancement of this entity will
depend largely on the success of this entity in providing high quality services
or products, which cannot be assured. If users do not perceive the Company's
future products or services to be comprehensive and of high quality, or if the
Company introduces new features, or enters into new business ventures that are
not favorably received by the public, the Company will risk diluting the value
of its operating entity. If the Company fails to provide high quality services
or product, or otherwise to promote and maintain a service or product, or if the
Company incurs excessive expenses in an attempt to improve services or product,
or promote and maintain a service or product, future results of operations and
financial condition could be materially and adversely affected.

GROWTH STRATEGY IMPLEMENTATION; ABILITY TO MANAGE GROWTH

The Company anticipates that significant expansion will be required to
address the Company's business plan and shareholder value. The Company's
expansion is expected to place a significant strain on its management,
operational and financial resources. To manage any material growth of the
Company's operations and personnel, the Company may be required to improve
existing operational and financial systems, procedures and controls and to
expand, train and manage its employee base. There can be no assurance that the
Company's planned personnel, financing, systems, procedures and controls will be
adequate to support its future operations, that management will be able to hire,
train, retain, motivate and manage required personnel or that its management
will be able to successfully identify, manage and exploit existing and potential
market opportunities. If the Company is unable to manage growth effectively, its
business, prospects, financial condition, and results of operations may be
materially adversely affected.

POSSIBLE FUTURE ISSUANCE OF COMMON STOCK

The Company is authorized to issue up to 100,000,000 Shares of Common
Stock. Presently, there are 34,573,800 shares of Common Stock issued and
outstanding. Additional issuances of Common Stock may be required to raise
capital, to acquire stock or assets of other companies, to compensate employees
or to undertake other activities without stockholder approval. These additional

issuances of Common Stock will increase outstanding shares and further dilute
stockholders' interests. Because the Company's Common Stock is currently subject
to the existing rules on penny stocks, the market liquidity for and value of its
securities can be severely adversely affected.

ITEM 2. PROPERTIES.

Corporate headquarters are located at 7263 E. San Alfredo Drive,
Scottsdale, AZ 85258. The dimension of the new office space is approximately 200
square feet. The space is at no charge to the Company and is provided by a
related party. The Company does not have any additional facilities, nor are
there proposed programs for the renovation, improvement, or development of the
properties currently being utilized.

ITEM 3. LEGAL PROCEEDINGS.

The Company was not subject to, in the years 2002 and 2003, nor are we currently
subject to any legal proceedings.

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

None.

PART II

ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

MARKET INFORMATION

The Company's common stock is currently traded on the OTC Bulletin Board
under the stock ticker symbol "BGRR." The following sets forth the high and low
bid quotations for the Common Stock for the year. These quotations reflect
prices between dealers, do not include retail mark-ups, markdowns, and
commissions and may not necessarily represent actual transactions.

HIGH LOW
---- ---
2003
For the period (July 1, 2002 to June 30, 2003) $2.00 $.08

During the year ended June 30, 2003, there were no shares of preferred
stock issued, or outstanding, and the Company did not offer stock options to its
employees.

There are approximately 30,000,000 shares of restricted common Stock of the
Company of which most of these restricted shares are less than two years old and
can only be sold under Rule 144 under the Securities Act of 1933, as amended.

There is currently a common equity that is being or is proposed to be
publicly offered by the Company, the offering of which could have a material
effect on the market price of the issuer's common equity.

HOLDERS

As of September 4, 2003, the Company had approximately 59 stockholders of
record.

DIVIDEND POLICY

The Company has not paid any dividends to date. In addition, it does not
anticipate paying dividends in the foreseeable future. The Board of Directors of
the Company will review its dividend policy from time to time to determine the
desirability and feasibility of paying dividends after giving consideration to
the Company's earnings, financial condition, capital requirements and such other
factors as the board may deem relevant.

ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

The Company is currently in negotiations with several restaurant chains
that fall into the fast-casual restaurant concept. One such concept is a
restaurant chain that specializes in quality hand made ice cream treats,
old-fashioned hamburgers, french fries and hand breaded onion rings. Each
restaurant is designed to purvey a feeling of an old-fashioned neighborhood
"burger joint" or malt shop. There distinctive "over the rim" extra thick
shakes, made in dozens of flavors, have made the brand famous and set it apart
from competitors.

Another concept the Company is currently in negotiations with serves up
noodles. Their menu has a mixture of Asian, Italian, American, and Mexican
influences in made-to-order noodle dishes. The entrees range from about $6 to
$9, and salads and appetizers are sold as well. The made-to-order noodle dishes
are served in a fast-casual concept that is a step up from fast food, with
softer lighting, open kitchens and eye-pleasing design touches. This fast-casual
concept has sold 39 franchises and has 25 more in negotiations.

REVENUES

The Company had revenues of $2,625 and $68 for the years ended June 30,
2003 and 2002 respectively.

G & A EXPENSES

Operating expenses totaled $39,353 and $37,522 for the years ended June 30,
2003 and 2002, respectively.

NET LOSS

The Company incurred a net loss in the amount of $39,353, for the year
ended June 30, 2003. This represents an increase of $1,831 over the net loss for
the prior year 2002 of $37,522.

LIQUIDITY AND CAPITAL RESOURCES

The Company experienced a cash outflow of $61,602 from continuing
operations during the year ended June 30, 2003, as compared to a net of $17,488
during the year ended June 30, 2002. The Company did not purchase assets with
cash during the year ended June 30, 2003.

The Company received no cash proceeds from the issuance of common stock for
equity investments in the Company during the year ended June 30, 2003 and 2002.

CASH NEEDS FOR THE NEXT TWELVE MONTHS

For the year 2003, the Company expects to incur greater overhead that may
be attributable to hiring additional employees, as necessary, and higher related
office expenses. The Company also expects to increase investments, which may
strain its cash position. The Company does not have sufficient financial
resources to support an increased level of operations for the next 12 months if
it does not generate sufficient revenues and/or if it fails to raise equity
capital as appropriate. Based on current information on hand and the Company's
latest expectation of its operations for the next 12 months, there is a
potential going concern issue.

The Company cannot give assurance that it can generate the cash it needs
for the next 12 months. There may be a shortfall in cash if the Company fails to
do so. The Company may need to obtain additional financing in the event that it
is unable to realize sufficient revenue. Furthermore, the Company's ability to
satisfy the redemption of future debt obligations that it may enter into will be
primarily dependent upon the future financial and operating performance of the
Company. Such performance is dependent upon financial, business and other
general economic factors, many of which are beyond the Company's control. If the
Company is unable to generate sufficient cash flow to meet its future debt
service obligations or provide adequate long-term liquidity, the Company will
have to pursue one or more alternatives, such as reducing or delaying capital
expenditures, refinancing debt, selling assets or operations or raising equity
capital. There can be no assurance that such alternatives can be accomplished on
satisfactory terms, if at all, or in a timely manner. If the Company does not
have sufficient cash resources when needed, the Company will not be able to
continue operations as a going concern.

ITEM 7. FINANCIAL STATEMENTS

The following documents (pages F-1 to F-8) form part of the report on the
Financial Statements

PAGE
----

Independent Auditors' Report F-1 to F-2
Balance Sheet F-3
Statements of Operations F-4
Statement of Stockholders' Equity F-5
Statements of Cash Flows F-6
Footnotes F-7 to F-9

INDEPENDENT AUDITORS' REPORT

To the Board of Directors of
BGR Corporation

We have audited the balance sheet of BGR Corporation (a Development Stage
Company), as of June 30, 2003 and the related statements of operations,
stockholders' equity (deficit) and cash flows for the year 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 audit.

We conducted our audit 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 audit provides a
reasonable basis for our opinion.

In our opinion, based on our audit, the financial statements referred to above
present fairly, in all material respects, the financial position of BGR
Corporation as of June 30, 2003 and the results of its operations and cash flows
for the year 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 1 to the
financial statements, the Company has not yet commenced operations, raised
capital or implemented a plan of operations. These matters raise substantial
doubt about the Company's ability to continue as a going concern. The financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.

/s/ EPSTEIN, WEBER & CONOVER, P.L.C.

Scottsdale, Arizona
September 24, 2003

F-1

ANDERSEN ANDERSEN & STRONG, L.C. 941 East 3300 South, Suite 202
Certified Public Accountants Salt Lake City, Utah 84106
and Business Consultants
Member SEC Practice Section
of the AICPA Telephone 801 486-0096
Fax 801 486-0098

Board of Directors
Cortex Systems, Inc.
Victoria B.C. Canada

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

We have audited the accompanying balance sheet of Cortex Systems Inc.
(development stage company) at June 30, 2002 and the related statement of
operations, stockholders' equity, and cash flows for the period July 6, 2001
(date of inception) to June 30, 2002. 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 audit 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 statements presentation. We believe that our audit provides 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 Cortex Systems Inc. at June
30, 2002 and the results of operations, and cash flows for the period July 6,
2001 (date of inception) to June 30, 2002 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. The Company does not have sufficient
working capital to service its debt and for its planned activity, which raises
substantial doubt about its ability to continue as a going concern. Management's
plans in regard to these matters are described in Note 5. These financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.

/s/ Andersen Andersen and Strong

Salt Lake City, Utah
September 25, 2003

F-2

BGR CORPORATION
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET AS OF JUNE 30, 2003

ASSETS

CURRENT ASSETS $ --

--------
TOTAL ASSETS --
========

LIABILITIES AND STOCKHOLDERS' EQUITY:

CURRENT LIABILITIES
Accounts payable $ 25

--------
TOTAL LIABILITIES 25
--------
STOCKHOLDERS' DEFICIT:
Common stock, $0.0001 par value, 100,000,000 shares
authorized, 34,573,800 shares issued and outstanding 3,457
Additional paid-in capital 73,393
Deficit accumulated during the development stage (76,875)
--------
Total stockholders' deficit (25)

--------
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT $ --
========

The Accompanying Notes are an Integral Part
of these Consolidated Financial Statements

F-3

BGR CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS

JULY 6, 2001 JULY 6, 2001
FOR THE (DATE OF (DATE OF
YEAR ENDED INCEPTION) TO INCEPTION) TO
JUNE 30, 2003 JUNE 30, 2002 JUNE 30, 2003
------------- ------------- -------------

INCOME $ 2,625 $ 68 $ 2,693
------------ ------------ ------------

COSTS AND EXPENSES:
General and administrative expense 41,978 37,590 79,568
------------ ------------ ------------
Total 41,978 37,590 79,568
------------ ------------ ------------
INCOME (LOSS) FROM OPERATIONS (39,353) (37,522) (76,875)

INCOME TAXES -- -- --
------------ ------------ ------------
NET INCOME (LOSS) $ (39,353) $ (37,522) $ (76,875)
============ ============ ============

NET INCOME (LOSS) PER COMMON SHARE
Basic $ * $ * $ *
============ ============ ============
Diluted $ * $ * $ *
============ ============ ============
WEIGHTED AVERAGE COMMON SHARES
OUTSTANDING (BASIC AND DILUTED) 34,573,800 30,860,729 32,687,502
============ ============ ============

* - less than $0.01 per share

The Accompanying Notes are an Integral Part
of the Financial Statement

F-4

BGR CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
FOR THE PERIOD JULY 6, 2001 (INCEPTION) TO JUNE 30, 2003

COMMON STOCK ADDITIONAL
-------------------- PAID-IN ACCUMULATED
SHARES AMOUNT CAPITAL DEFICIT TOTAL
------ ------ ------- ------- -----

Common Shares issued for cash 34,573,800 $3,457 $73,393 $ -- $ 76,850

Net loss for the period from
inception to June 30, 2002 -- -- -- (37,522) (37,522)
---------- ------ ------- -------- --------

BALANCE JUNE 30, 2002 34,573,800 3,457 73,393 (37,522) 39,328
---------- ------ ------- -------- --------
Net loss for the year ended
June 30, 2003 -- -- -- (39,353) (39,353)
---------- ------ ------- -------- --------

BALANCE JUNE 30, 2003 34,573,800 $3,457 $73,393 $(76,875) $ (25)
========== ====== ======= ======== ========

The Accompanying Notes are an Integral Part
of the Financial Statements

F-5

BGR CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOWS

PERIOD FROM PERIOD FROM
JULY 6, 2001 JULY 6, 2001
(DATE OF INCEPTION) (DATE OF INCEPTION)
YEAR ENDED TO TO
JUNE 30, 2003 JUNE 30, 2002 JUNE 30, 2003
------------- ------------- -------------

CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss) $(39,353) $(37,522) $(76,875)
Adjustments to reconcile net income to net cash
used in operating activities:
Common stock issued as consderation for services 90 90
Write-off of Loan from Shareholder (2,330) (2,330)
Changes in assets and liabilities:
Accounts payable and accrued liabilities (19,919) 19,944 25
-------- -------- --------
Net cash used in operating activities (61,602) (17,488) (79,090)
-------- -------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of advances from shareholder (12,170) -- (12,170)
Proceeds from advances from shareholder -- 14,500 14,500
Common stock issued for cash -- 76,760 76,760
-------- -------- --------
Net cash used in financing activities (12,170) 91,260 79,090
-------- -------- --------

INCREASE (DECEASE) IN CASH AND EQUIVALENTS (73,772) 73,772 --

CASH AND EQUIVALENTS, BEGINNING OF PERIOD 73,772 -- --
-------- -------- --------

CASH AND EQUIVALENTS, END OF PERIOD $ -- $ 73,772 $ --
======== ======== ========

SUPPLEMENTAL CASH FLOW INFORMATION:
Interest paid $ -- $ -- $ --
======== ======== ========
Income taxes paid $ -- $ -- $ --
======== ======== ========

The Accompanying Notes are an Integral Part
of the Financial Statements

F-6

BGR CORPORATION
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2003

1. ORGANIZATION AND BASIS OF PRESENTATION

BGR Corporation (the "Company") a Nevada corporation, was incorporated on July
6, 2001. The Company is a development stage enterprise with a fiscal year ending
June 30. The Company was formerly named Cortex Systems, Inc. The Company intends
to develop and franchise casual dining restaurants. The Company is seeking to
acquire assets within this industry and has begun negotiations with at least one
target. To date, the Company has had no revenues associated with these
activities.

The Company's ownership includes an interest of approximately 87% owned by
Iceberg Food Systems Corp.

The Company faces many operating and industry challenges. There is no meaningful
operating history to evaluate the Company's prospects for successful operations.
Future losses for the Company are anticipated. The proposed plan of operations
would include seeking an operating entity with which to merge. Even if
successful, a merger may not result in cash flow sufficient to finance the
continued expansion of a business.

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As mentioned above, the Company
intends to seek a merger candidate and has identified at least one possible
candidate. However, the Company has not yet obtained capital needed to achieve
management's plans and support its operations and there is no assurance that the
Company will be able to raise such financing. These factors raise substantial
doubt about the Company's ability to continue as a going concern. The financial
statements do not include any adjustments that might result from this
uncertainty.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Cash and Cash Equivalents - Cash and cash equivalents include all short-term
liquid investments that are readily convertible to known amounts of cash and
have original maturities of three months or less. The Company had no cash or
cash equivalents as of June 30, 2003.

Income taxes - The Company provides for income taxes based on the provisions of
Statement of Financial Accounting Standards No. 109, ACCOUNTING FOR INCOME
TAXES, which among other things, requires that recognition of deferred income
taxes be measured by the provisions of enacted tax laws in effect at the date of
financial statements.

Use of Estimates - The preparation of financial statements in conformity with
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 period. Actual results could differ from those estimates.

Income (Loss) Per Common Share - Basic income per share is computed using the
weighted average number of shares of common stock outstanding for the period.
The Company has a simple capital structure and therefore there is no
presentation for diluted loss per share.

Recently Issued Accounting Pronouncements -

In October 2001, the FASB issued SFAS No. 143, "Accounting for Asset Retirement
Obligations," which requires companies to record the fair value of a liability
for asset retirement obligations in the period in which they are incurred. The
statement applies to a company's legal obligations associated with the
retirement of a tangible long-lived asset that results from the acquisition,
construction, and development or through the normal operation of a long-lived

F-7

BGR CORPORATION
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2003 (CONT.)

asset. When a liability is initially recorded, the company would capitalize the
cost, thereby increasing the carrying amount of the related asset. The
capitalized asset retirement cost is depreciated over the life of the respective
asset while the liability is accreted to its present value. Upon settlement of
the liability, the obligation is settled at its recorded amount or the company
incurs a gain or loss. The statement is effective for fiscal years beginning
after June 30, 2002. The Company does not expect the adoption to have a material
impact to the Company's financial position or results of operations.

In October 2001, the FASB issued SFAS No. 144, "Accounting for the Impairment or
Disposal of Long-Lived Assets". Statement 144 addresses the accounting and
reporting for the impairment or disposal of long-lived assets. The statement
provides a single accounting model for long-lived assets to be disposed of. New
criteria must be met to classify the asset as an asset held-for-sale. This
statement also focuses on reporting the effects of a disposal of a segment of a
business. This statement is effective for fiscal years beginning after December
15, 2001. The Company does not expect the adoption to have a material impact to
the Company's financial position or results of operations.

In July 2002, the FASB issued SFAS No. 146, "Accounting for Costs Associated
With Exit or Disposal Activities". This Standard requires costs associated with
exit or disposal activities to be recognized when they are incurred. The
requirements of SFAS No. 146 apply prospectively after December 31, 2002, and as
such, the Company cannot reasonably estimate the impact of adopting these new
rules.

In December 2002, the FASB issued SFAS No. 148, Accounting for Stock-Based
Compensation - Transaction and Disclosure, which provides alternative methods of
transition for a voluntary change to fair value based method of accounting for
stock-based employee compensation as prescribed in SFAS 123, Accounting for
Stock-Based Compensation. Additionally, SFAS No. 148 requires more prominent and
more frequent disclosures in financial statements about the effects of
stock-based compensation. The provisions of this statement are effective for
fiscal years ending after December 15, 2002, with early application permitted in
certain circumstances.

In November 2002, the FASB issued Interpretation No. 45 ("FIN 45"), Guarantor's
Accounting and Disclosure Requirements for Guarantees, including Indirect
Guarantees of Indebtedness of Others. FIN 45 requires a company, at the time it
issues a guarantee, to recognize an initial liability for the fair value of
obligations assumed under the guarantees and elaborates on existing disclosure
requirements related to guarantees and warranties. The initial recognition
requirements are effective for the Company during the third quarter ending March
31, 2003. The adoption of FIN 45 did not have an impact on the Company's
financial position or results of operations.

In January 2003, the FASB issued FASB Interpretation No. 46 ("FIN 46"),
Consolidation of Variable Interest Entities, an Interpretation of ARB No. 51.
FIN 46 requires certain variable interest entities to be consolidated by the
primary beneficiary of the entity if the equity investors in the entity do not
have the characteristics of a controlling financial interest or do not have
sufficient equity at risk for the entity to finance its activities without
additional subordinated financial support from other parties. FIN 46 is
effective for all new variable interest entities created or acquired after
January 31, 2003. For variable interest entities created or acquired prior to
February 1, 2003, the provisions of FIN 46 must be applied for the first interim
or annual period beginning after June 15, 2003. The adoption of FIN 46 did not
have an impact on the Company's financial position or results of operations.

F-8

BGR CORPORATION
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2003 (CONT.)

3. INCOME TAXES

The Company recognizes deferred income taxes for the differences between
financial accounting and tax bases of assets and liabilities. Income taxes for
the year ended June 30, 2003 consist of the following:

Current tax provision (benefit) $(5,900)
Deferred tax provision (benefit) 5,900
-------

Total income tax provision (benefit) $ 0
=======

There were no material temporary book/tax differences for the period ended June
30, 2003. There was a deferred tax asset of $11,850 at June 30, 2003, relating
to net operating loss carryforwards of approximately $79,000. The deferred
income tax asset is fully offset by a valuation allowance. The valuation
allowance was increased by $5,900 in the year ended June 30, 2003. The net
operating loss carryforwards begin to expire in 2021.

4. CAPITAL STOCK

The Company declared a 6 for 1 stock split during the year ended June 30, 2003.
The number of shares presented in these financial statements has been
retroactively restated for all periods to reflect this stock split.

5. RELATED PARTY TRANSACTIONS

The Company's former officers, directors and majority shareholders made advances
to the Company in order for the Company to pay its operating expenses. During
the year ended June 30, 2003, the Company repaid $12,170 of the advances. One of
these individuals forgave the balance due to him of $2,330 during the year ended
June 30, 2003.

At June 30, 2003, the Company utilized office space provided by one of its
officers and directors at no charge to the Company.

F-9

ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE

On August 22, 2003 the Company filed a Change in Registrant's Certifying
Account with the SEC. The Company has no disagreements with its accountants on
accounting and financial disclosure.

PART III

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

The names, ages and positions of the Company's directors and executive
officers are as follows:

Name Age Position
---- --- --------
Jerry Brown 66 President & Director
Edward C. Heisler 37 Secretary
Colin Campbell 44 Treasurer
George Krotonsky 31 Director
Alan Smith 52 Director
Gordon J. Sales 66 Director

FAMILY RELATIONSHIPS

There are no family relationships between the Company's directors and
executive officers.

WORK EXPERIENCE

JERRY BROWN, PRESIDENT, Mr. Brown is a CPA with over 30 years of financial and
administrative management experience with a large law firm in Salt Lake City,
Utah, where he held the position of Director of Finance and Administration. He
has experience in banking relations, property management and employee benefits
in addition to his extensive experience in accounting, business management and
taxation.

EDWARD C. HEISLER, SECRETARY, Mr. Heisler, who holds a Bachelor of Science
Degree in Business Management, has held several executive positions with various
public companies. He brings with him a strong knowledge, not only in business
management, but also in corporate filings and compliance.

COLIN CAMPBELL, TREASURER, Dr. Campbell, who holds a Doctorate of Business
Administration, a Masters Degree in Business Administration, and a Bachelor of
Arts Degree in Economics, is the president and founder of Campbell and Company
Financial Group Inc. Campbell and Company Financial Group Inc. is an accounting
firm specializing in providing account services for those in the food service
industry.

GEORGE KROTONSKY, DIRECTOR, Mr. Krotonsky is a founding member of Global
Restaurant Development Company and has over fifteen years experience in the
restaurant and franchise industries including over six years with Brinker
International. He brings extensive experience in restaurant operations and
training, menu and recipe development, financial budgeting, facility design,
restaurant layouts and workflow designs.

ALAN SMITH, OUTSIDE DIRECTOR, Mr. Smith, who holds both a Bachelor and Masters
Degrees and has served as an officer and director for many public companies, has
provided audit, accounting, finance and administrative consulting services to a
wide range of privately owned and public companies through his wholly-owned
company Avid Management Corporation.

GORDON J. SALES, OUTSIDE DIRECTOR, is the president and CEO of Crystal Graphite
Corporation. In addition, his past experiences have included several executive
positions with various public companies. Mr. Sales brings a high level of
operating management and marketing skills, and will provide BGR Corporation with
a wealth of experience as an outside director.

INVOLVEMENT ON CERTAIN MATERIAL LEGAL PROCEEDINGS DURING THE LAST FIVE YEARS

(1) No director, officer, significant employee or consultant has been convicted
in a criminal proceeding, exclusive of traffic violations.

(2) No bankruptcy petitions have been filed by or against any business or
property of any director, officer, significant employee or consultant of the
Company nor has any bankruptcy petition been filed against a partnership or
business association where these persons were general partners or executive
officers.

(3) No director, officer, significant employee or consultant has been
permanently or temporarily enjoined, barred, suspended or otherwise limited from
involvement in any type of business, securities or banking activities.

(4) No director, officer or significant employee has been convicted of violating
a federal or state securities or commodities law.

ITEM 10. EXECUTIVE COMPENSATION

REMUNERATION OF DIRECTORS, EXECUTIVE OFFICERS AND SIGNIFICANT EMPLOYEES

The Company does not have employment agreements with its executive
officers. They have yet to determine the appropriate terms needed for the
creation of employment agreements for its officers. There has been no discussion
with any of the Company's officers regarding any potential terms of these
agreements, nor have such terms been determined with any specificity. The
Company plans to have these agreements completed by the beginning of the next
year. They have no proposal, understanding or arrangement concerning accrued
earnings to be paid in the future. In the meanwhile, none of the current
executive officers have been drawing salaries since they were appointed to their
positions.

Summary Compensation Table

Annual Compensation Long-Term Compensation
---------------------------- ----------------------------------
Other
Annual Restricted Securities All Other
Name and Compensa Stock Underlying LTIP Compensa
Principal Position Year Salary($) Bonus($) tion($) Awards($) Options(#) Payouts($) tion($)
------------------ ---- --------- -------- ------- --------- ---------- ---------- -------

Jerry Brown 2003 0 0 0 0 0 0 0
President

Edward C. Heisler 2003 0 0 0 0 0 0 0
Secretary

Colin Campbell 2003 0 0 0 0 0 0 0
Treasurer

Ingrid C. Friesen 2003 0 0 0 $14,375,000 0 0 0
Former Secretary &
Treasurer

Kenneth H. Finkelstein 2003 0 0 0 $14,375,000 0 0 0
Former President

DIRECTORS' COMPENSATION

The Company has no formal or informal arrangements or agreements to
compensate its directors for services they provide as directors of the Company.

EMPLOYMENT CONTRACTS AND OFFICERS' COMPENSATION

Since incorporation, the Company has not paid compensation to its officers.
The Company does not have employment agreements with any of its current
officers, directors of employees. Any future compensation to be paid to these
individuals will be determined by the Board of Directors, and employment
agreements will be executed.

STOCK OPTION PLAN AND OTHER LONG-TERM INCENTIVE PLAN

The Company, as of September 2003, does not have an existing or proposed
option/SAR grants. In September of 2003 the Company offered stock options to its
employees through a Qualified Stock Option Plan that reserved 1,000,000 shares
for the plan. The Company did issue 125,000 shares to consultants under the
plan.

ITEM 11. SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN SECURITY HOLDERS

SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN BENEFICIAL OWNERS

The following table sets forth as of June 30, 2003 certain information
regarding the beneficial ownership of our common stock by:

1. Each person who is known by us to be the beneficial owner of more than
5% of the common stock,

2. Each of our directors and executive officers and

3. All of our directors and executive officers as a group.

Except as otherwise indicated, the persons or entities listed below have
sole voting and investment power with respect to all shares of common stock
beneficially owned by them, except to the extent such power may be shared with a
spouse. No change in control is currently being contemplated.

Name and Address Amount and Nature of
Title of Class of Beneficial Owner Beneficial Owner %of Class
-------------- ------------------- ---------------- ---------
Common Stock Iceberg Food Systems Corp 16,410,000
Scottsdale, AZ > 5% 47%

Common Stock Advantage Nevada Corporation 1,903,000
Allison Park, PA > 5% 5.5%

Common Stock Alexis Group LLC (Jerry Brown) 1,350,000
Scottsdale, AZ Officer 4%

Common Stock Edward C. Heisler 1,445,000
Scottsdale, AZ Officer 4%

Common Stock Colin Campbell 500,000
Chandler, AZ Officer 1%

Common Stock Alan Smith 500,000
Edinburgh, Scotland Director 1%

Common Stock Gordon Sales 500,000
Vancouver, B.C. Director 1%

Common Stock All Directors and Officers 4,295,000 12%

NON-VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF

The Company has not issued any non-voting securities.

OPTIONS, WARRANTS AND RIGHTS

The Company has no options, warrants and rights outstanding

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Jerry Brown, Company President, Edward C. Heisler, Company Secretary, and
Colin Campbell, Company Treasurer, are officers of Iceberg Food Systems Corp.
Iceberg Food Systems Corp is the beneficial owner of 47% of the Company's
current outstanding common stock.

The Company's former officers, directors and majority shareholders made
advances to the Company in order for the Company to pay its operating expenses.
During the year ended June 30, 2003, the Company repaid $12,170 of the advances.
One of these individuals forgave the balance due to him of $2,330 during the
year ended June 30, 2003.

ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K

Exhibit Number Name and/or Identification of Exhibit
-------------- -------------------------------------
31.1 Certification of Chief Executive Officer pursuant to Section 302
of The Sarbanes-Oxley Act Of 2002 Exhibit

31.2 Certification of Chief Financial Officer pursuant to Section 302
of The Sarbanes-Oxley Act Of 2002

32.1 Certification of Chief Executive Officer pursuant to Section 906
of The Sarbanes-Oxley Act Of 2002

32.2 Certification of Chief Financial Officer pursuant to Section 906
of The Sarbanes-Oxley Act Of 2002

Date Filed Items Disclosed in Report on Form 8-K and 8-K/A
---------- -----------------------------------------------
11/26/2002 Item 5 - Other Events

12/06/2002 Item 5 - Other Events

01/21/2003 Item 5 - Other Events

07/02/2003 Item 1 - Changes in Control of Registrant
Item 5- Other Events

08/22/2003 Item 4 - Change in Registrant's Certifying Account
Item 5 - Other Events

09/10/2003 Item 5 - Other Events

09/12/2003 Item 4 - Change in Registrant's Certifying Account

SIGNATURES

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

BGR Corporation
(Registrant)

Signature Title Date
--------- ----- ----

/s/ Colin Campbell Chief Financial Officer September 25, 2003
-----------------------
Colin Campbell

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

Signature Title Date
--------- ----- ----

/s/ Jerry Brown President September 25, 2003
-----------------------
Jerry Brown

/s/ Edward C. Heisler Secretary September 25, 2003
-----------------------
Edward C. Heisler

/s/ Colin Campbell Treasurer September 25, 2003
-----------------------
Colin Campbell