focus. The Company's focus is now on acquiring new innovative fast-casualrestaurant concepts, develop them into a profitable working design, andfranchise them across the United States. On January 20, 2003, we entered into anagreement with American Restaurant Development Corporation, or ARDC, to growrestaurant concepts into a fully viable franchise system and to expand eachrestaurant concepts nationwide. The controlling shareholder of ARDC is ourlargest shareholder. To date, we have formed four joint ventures with differentrestaurant concepts under this model.

On November 4, 2003, we acquired Fathom Business Systems, or Fathom. Fathomis a company specializing in restaurant point of sales equipment. Fathomgenerates additional revenue by providing its customers with the supplies andservice needed for the equipment.

On February 2, 2004, we executed an agreement with AZTECA Wrap Foods, LLC,or AZTECA. AZTECA is the owner and operator of KoKopelli's Mexican Grill.KoKopelli's is a fast casual Mexican restaurant specializing in made-to-orderMexican-style food. Per the agreement, we own 50% of the joint venture entity,while the other 50% is owned by AZTECA. Additionally, we are required to providethe funding to initiate the franchising of KoKopelli's through ARDC. AZTECA willprovide exclusive rights to the "KoKopelli" name, trade marks, trade dress,operating system and recipes.

In April 2004, we entered into a shareholders agreement with Alexis Group,LLC, or ALEXIS. ALEXIS is the owner and operator of Pauli's Home of theSteakBurger. Per the agreement, we own 50% of the joint venture entity, whilethe other 50% is owned by ALEXIS. Additionally, we are required to provide thefunding to initiate the franchising of Pauli's through ARDC. ALEXIS will provideexclusive rights to the "Pauli's" name, trade marks, trade dress, operatingsystem and recipes.

In April 2004, we executed a shareholders agreement with Brian Ruggiero,the owner and operator of Cousin Vinnie's Italian Diner. The Cousin Vinnie'sconcept was brought to BGR Corporation by American Restaurant DevelopmentCorporation ("ARDC"). Per the agreement, we own 50% of the joint venture entity,while the other 50% is owned by Ruggiero. Additionally, we are required toprovide the funding to initiate the franchising of Cousin Vinnie's through ARDC.Ruggiero will provide exclusive rights to the "Cousin Vinnie's" name, trademarks, trade dress, operating system and recipes.

In April 2004, the purchase agreement for us to acquire Deville, Inc. wasmutually cancelled. The agreement called for us to pay $700,000 in stock andcash for the exclusive rights to the Lucky Lou's fast casual restaurant concept.Stock that had been issued per the agreement has been returned to the Company'streasury.

On April 15, 2004, our Board of Directors approved a stock dividend for allshareholders of record as of May 15, 2004. Under he terms of the dividenddistribution, for every three shares held by a shareholder they will receive oneadditional share. No fractional shares are to be issued.

Results of Operations

The Company had revenue of $31,238 for the three months ending March 31,2004. This revenue relates to services provided by the new Fathom business unit.

Total general and administrative operating expenses for the three monthsending March 31, 2004 were $700,140. This increase from the prior quarter wasdue to a significant increase in consulting fees, which were primarily paidthrough the issuance of the Company's common stock.

The Company recorded a net loss for the three months ending March 31, 2004of $687,318. This loss was primarily due to the expense related to the issuanceof stock to various consultants. The consultants provide such services andadvice to the Company in business development, business strategy and corporateimage.

The Company has allocated the excess of the purchase price of Fathom overthe amounts allocated to tangible assets acquired and liabilities assumed asintangible assets. The Company is in the process of analyzing that amount todetermine what amounts are to be allocated to intangible assets that can beidentified and recognized as assets apart from goodwill. Consequently, therewill likely be a reallocation of the amount reported as intangible assets on theaccompanying balance sheet as of March 31, 2004.

Liquidity and Capital Resources

The Company experienced a cash outflow of $89,990 from continuingoperations during the nine months ending March 31, 2004, as compared to a net of$73,262 during the nine months ending March 31, 2003. The Company will need toprovide Fathom with approximately $60,000 in the next quarter. These funds willbe used to settle its current liabilities and for Fathom to accelerate its rampup.

The Company did not purchase assets with cash during the three monthsending March 31, 2004. Although, the Company has assumed a note in the amount of$400,000 due to One Husker One Cane from Deville, Inc., a wholly ownedsubsidiary of BGR Corporation. It is the Company's intention to settle this notebefore the end of this year. In addition the Company has agreed to provideIceberg Food Systems Corporation with $1,130,000 as per the agreement betweenthe Company and Iceberg Food Systems Corporation. Due to changes in Iceberg FoodSystems need for the $1,130,000, BGR Corporation and Iceberg Food Systems arecurrently discussing other alternatives in settling this commitment. The Companywill continue to attempt to raise additional equity capital to fund theoperations of the businesses it has recently acquired.

Going Concern

For the next three months, the Company expects to incur greater overheadthat may be attributable to hiring additional employees, as necessary, andhigher related office expenses. The Company also expects to increaseinvestments, which may strain its cash position. The Company does not havesufficient financial resources to support an increased level of operations for

the next three months if it does not generate sufficient revenues and/or if itfails to raise equity capital as appropriate. Based on current information onhand and the Company's latest expectation of its operations for the next threemonths, there is a potential going concern issue.

The Company cannot give assurance that it can generate the cash it needsfor the next three months. There may be a shortfall in cash if the Company failsto do so. The Company may need to obtain additional financing in the event thatit is unable to realize sufficient revenue. Furthermore, the Company's abilityto satisfy the redemption of future debt obligations that it may enter into willbe primarily dependent upon the future financial and operating performance ofthe Company. Such performance is dependent upon financial, business and othergeneral economic factors, many of which are beyond the Company's control. If theCompany is unable to generate sufficient cash flow to meet its future debtservice obligations or provide adequate long-term liquidity, the Company willhave to pursue one or more alternatives, such as reducing or delaying capitalexpenditures, refinancing debt, selling assets or operations or raising equitycapital. There can be no assurance that such alternatives can be accomplished onsatisfactory terms, if at all, or in a timely manner. If the Company does nothave sufficient cash resources when needed, the Company will not be able tocontinue operations as a going concern.

Certain Risk Factors Affecting Our Business

Our business involves a high degree of risk. Potential investors shouldcarefully consider the risks and uncertainties described below and the otherinformation in this report before deciding whether to invest in shares of ourcommon stock. If any of the following risks actually occur, our business,financial condition, and results of operations could be materially and adverselyaffected. This could cause the trading price of our common stock to decline,with the loss of part or all of an investment in the common stock.