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

                                  FORM 10KSB/A
                                 Amendment No. 1
(Mark  One)
          [X]  ANNUAL  REPORT  PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
               EXCHANGE  ACT  OF  1934
               For  the  fiscal  year  ended  December  31,  2001
               TRANSITION  REPORT  UNDER  SECTION  13 OR 15(d) OF THE SECURITIES
               EXCHANGE  ACT  OF  1934
          [ ]  For  the  transition  period  from              to            .
                                                  ------------    ------------

                        Commission File Number 000-26463
                                               ---------

                           MILITARY RESALE GROUP, INC.
                 (Name of small business issuer in its charter)
                 ----------------------------------------------

          New York                                       11-2665282
-----------------------------------          -----------------------------------
(State or other jurisdiction of              I.R.S. Employer Identification No.
incorporation or organization)



2180 Executive Circle, Colorado Springs, Colorado              80906
-------------------------------------------------       -------------------
(Address of principal executive offices)                     (Zip Code)


Issuer's  telephone  number:  (719)  391-4564
                              ---------------

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

                         Common Stock, $.0001 par value
                        --------------------------------
                                (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.  Yes [X]  No [  ]

Check  if  no  disclosure  of  delinquent  filers  in  response  to  Item 405 of
Regulation S-B is contained in this form, and no disclosure is contained, to the
best  of  the  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  registrant's  revenues  for  its  most  recent  fiscal  year.  $4,851,433
                                                                      ----------
As  of  March  15,  2002, the registrant had outstanding 7,805,004 shares of its
common  stock.

As  of  March  15,  2002,  the aggregate market value of the registrant's common
stock  held  by  non-affiliates  was  $1,597,902  (based  upon the closing price
                                      ----------
($0.58)  of  the  registrant's  common  stock  on the OTC Bulletin Board on such
date).

<PAGE>

                           MILITARY RESALE GROUP, INC.
                         2001 FORM 10-K/A ANNUAL REPORT



                                TABLE OF CONTENTS

                                                                 PAGE  NO.

INTRODUCTORY  NOTE                                                       II

PART  I

     ITEM  6.      MANAGEMENT'S  DISCUSSION  AND
                   ANALYSIS  OR  PLAN  OF  OPERATION                      1

     ITEM  7.      FINANCIAL  STATEMENTS                                F-1



                                        i

<PAGE>

                                INTRODUCTORY NOTE

     We  are  filing  this  Form  10-KSB/A  in  order  to  amend and restate the
information disclosed in Items 6 and 7 of Part I.  The principal changes we made
were  as  follows:  (i)  we  revised  our  statement  of operations to recognize
additional  interest  expense  relating  to the beneficial conversion feature of
$35,000  aggregate  principal  amount  of convertible promissory notes that were
issued  in the fourth quarter of 2001 and (ii) we revised the manner in which we
accounted  for  the issuance of 875,000 shares of our common stock to certain of
our  employees  and directors in the fourth quarter of 2001.  This Form 10-KSB/A
does  not  necessarily reflect events occurring after the filing of the original
Form  10-KSB.


                                       ii
<PAGE>


PART  I

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


GENERAL

     Certain  statements  in this Report constitute "forward-looking statements"
within  the  meaning  of  the  Private Securities Litigation Reform Act of 1995.
Such  forward-looking  statements involve known and unknown risks, uncertainties
and  other  factors  which  may  cause  our  actual  results,  performance  or
achievements  to be materially different from any future results, performance or
achievements  expressed or implied by such forward-looking statements. The words
"believe",  "expect",  "anticipate", "intend" and "plan" and similar expressions
identify  forward-looking  statements.  Readers are cautioned not to place undue
reliance  on  these  forward-looking statements, which speak only as of the date
the  statement  was made. Because our common stock is considered a "penny stock"
as  defined  by  the  regulations of the Securities and Exchange Commission, the
safe  harbor  for forward-looking statements does not apply to statements by our
company.

     The  following  discussion should be read in conjunction with the financial
statements  and  related  notes  appearing  elsewhere  in  this  Report.

     Our  business  and  results of operations are affected by a wide variety of
factors  that  could  materially and adversely affect us and our actual results,
including,  but  not  limited  to:  (1)  the availability of additional funds to
enable  us  to  successfully  pursue  our  business  plan; (2) the uncertainties
related  to  the  effectiveness  of  our  technologies  and  the addition of new
products  and  suppliers;  (3)  our  ability  to maintain, attract and integrate
management  personnel;  (4)  our  ability  to  complete  the  development of our
proposed  product line in a timely manner; (5) our ability to effectively market
and sell our products and services to current and new customers; (6) our ability
to  negotiate  and  maintain  suitable  strategic  partnerships  and  corporate
relationships  with  suppliers  and  manufacturers;  (7)  the  intensity  of
competition;  and  (8)  general  economic  conditions.  As a result of these and
other  factors,  we  may  experience  material  fluctuations in future operating
results  on  a  quarterly  or annual basis, which could materially and adversely
affect  our  business,  financial  condition, operating results and stock price.

     Any forward-looking statements herein speak only as of the date hereof.  We
undertake  no  obligation  to  publicly  release the results of any revisions to
these  forward-looking  statements  that  may  be  made  to  reflect  events  or
circumstances  after  the  date  hereof  or  to  reflect  the  occurrence  of
unanticipated  events.

     Prior  to November 15, 2001, we did not generate any signification revenue,
and  accumulated  no  significant  assets,  as  we  explored  various  business
opportunities.  On  November  15,  2001,  we  acquired  98.2%  of the issued and
outstanding capital stock of Military Resale Group, Inc., a Maryland corporation
("MRG-Maryland"),  in  exchange  for a controlling interest in our publicly-held
"shell"  corporation  ("the  Reverse  Acquisition").  For  financial  reporting
purposes,  MRG-Maryland  was  considered the acquirer in such transaction.  As a
result, our historical financial statements for any period prior to November 15,
2001  are  those  of  MRG-Maryland.


RESULTS  OF  OPERATIONS  -  YEAR  ENDED DECEMBER 31, 2001 COMPARED TO YEAR ENDED
DECEMBER  31,  2000

     Revenue.  Total  revenue for the year ended December 31, 2001 of $4,851,433
reflected  an  increase  of  $371,128,  or approximately 8.3%, compared to total
revenue  of  $4,480,305  for  the year ended December 31, 2000. Our revenues are
derived  in  either  one of two ways.  In the majority of instances, we purchase
products  from  manufacturers  and  suppliers  for resale to the commissaries we
service.  In  such cases, we resell the manufacturer's or supplier's products to
the  commissaries  at  generally the same prices we pay for such products, which
prices  generally  are  negotiated  between the manufacturer or supplier and the
Defense  Commissary  Agency  ("DeCA").  Revenue is recognized as the gross sales
amount  received  by  us from such sales ("resale revenues"), which includes (i)

                                        1

<PAGE>

the  purchase  price  paid  by the commissary plus (ii) a negotiated storage and
delivery  fee paid by the manufacturer or supplier.  In the remaining instances,
we act as an agent for the manufacturer or supplier of the products we sell, and
earn  a  commission paid by the manufacturer or supplier, generally in an amount
equal  to  a  percentage  of the manufacturer's or supplier's gross sales amount
("commission revenues").  In such cases, revenue is recognized as the commission
we  receive  on  the  gross  sales  amount.

     Resale revenue for the year ended December 31, 2001 of $4,560,347 reflected
an  increase  of $528,072, or approximately 13.1%, compared to resale revenue of
$4,032,275  for  the  year  ended  December  31,  2000.
For  the  year  ended December 31, 2001, approximately 49.1% of our gross profit
was  derived from sales involving resale revenue compared to approximately 36.9%
for  the  year  ended  December  31,  2000.  These  increases  were attributable
primarily to the addition of the new products we began supplying to commissaries
during the fourth quarter of fiscal 2001, including Slimfast, L'eggs, Bush Beans
and  Rayovac Batteries, and during the first quarter of fiscal 2002, including a
line of feminine hygiene products and a line of infant feeding products supplied
by  Playtex  Products,  Inc.  which  we  sell  on a resale basis, as well as the
implementation  of  our  long-term  strategy  to  increase our ratio of sales of
products  we  sell on a resale basis, rather than a commission basis, due to the
payment  discounts  we often receive from the manufacturers and suppliers of the
goods  we  purchase  for  resale.

     Commission  revenues  for  the  year  ended  December  31, 2001 of $291,086
reflected  a  decrease of $156,944, or approximately 35%, compared to commission
revenues  of  $448,030  for the year ended December 31, 2000. For the year ended
December  31,  2001,  approximately  50.9%  of our gross profit was derived from
sales  involving  commission revenues as compared to approximately 63.1% for the
year ended December 31, 2000. These decreases were attributable primarily to the
implementation  of  our  long-term  strategy  to  increase our ratio of sales of
products  sold  on  a resale basis, rather than a commission basis. We cannot be
certain  as  to  whether or not these trends will continue; however, in the long
term  we  are  seeking  to increase the ratio of our sales of products sold on a
resale basis, rather than a commission basis, because we believe we can increase
our  profitability  on  such  sales  by  taking  advantage  of payment discounts
frequently  offered  by  the manufacturers and suppliers of such products. To do
so,  we  intend  to  continue  to  seek to add new products that we can offer to
commissaries  on a resale basis from our existing manufactures and suppliers and
from  others  with  whom  we  do  not  currently  have  a  working relationship.

     In  March 2002, we entered into an agreement with Playtex Products, Inc. to
distribute,  on  a  resale  basis,  approximately  70 Stock Keeping Units (SKUs)
manufactured  or  supplied  by  Playtex,  including  a  line of feminine hygiene
products  and  a  line  of  infant  feeding  products.  We  have been advised by
Playtex,  and  verified  with  DeCA,  that  sales  by  Playtex  in  2001  to the
commissaries  we currently service amounted to approximately $350,000.  However,
there  can  be no assurance that our annual sales of Playtex products will reach
such  amount,  and the amount of our actual sales of Playtex products may differ
materially  from  the amounts sold by Playtex in 2001 as a result of one or more
of  the  factors  described  above,  among  others.

     In  April  2002,  we  began distributing products for Pfizer, Inc. under an
agreement that provided for the distribution of approximately 114 SKUs of Pfizer
products.  In  June 2002, the agreement was terminated by Pfizer because we were
unable  to  consistently  meet  our delivery obligations due to our insufficient
working  capital.  During  the  term  of  our agreement with Pfizer, we received
revenue  from the sale of Pfizer products of approximately $168,000.  Management
believes  the  termination  of  the  Pfizer  agreement  will not have a material
adverse  impact  on  our  results  of  operations  for  fiscal  2002.

     In  October  2002,  we added to our supplier network the Hillshire Farm and
Kahn's  product  groups  of  Sara  Lee  Foods-USA  and certain consumer products
distributed  by  Chattem,  Inc.  Hillshire  Farm and Kahn's are product lines of
packaged  meats  and  hams.  Chattem  is  a  manufacturer  of  branded  consumer
products,  principally  over-the-counter  healthcare  products,  including
Aspercreme,  Gold Bond, Sportscreme, Pamprin, Dexatrim, Rejuvex and Flexall.  We
have  been  advised by Sara Lee Foods-USA, and verified with DeCA, that sales of
Hillshire  Farm  and  Kahn's  products  in 2001 to the commissaries we currently
service amounted to approximately $950,000. We have been advised by Chattem, and
verified  with  DeCA,  that  sales  of Chattem's line of products in 2001 to the
commissaries  we  currently service amounted to approximately $200,000. However,
there  can  be  no  assurance that our annual sales of these products will reach
such  amounts,  and  the amount of our actual sales of Hillshire Farm and Kahn's
Products  and  Chattem  products  may differ materially from the amounts sold by
Sara  Lee  Foods-USA  and  Chattem,  respectively,  in  2001.


                                        2
<PAGE>

     Management  believes  our long-term success will be dependent in large part
on  our ability to add additional product offerings to enable us to increase our
sales  and  revenues.  However, we believe our ability to add additional product
offerings  is  dependent on our ability to obtain additional capital to fund new
business  development  and  increased  sales  and  marketing  efforts.  We  are
currently  in  discussions with a number of other manufacturers and suppliers in
an effort to reach an  agreement under which we can distribute their products to
the  military  market.  While  there  can be no assurance that we will do so, we
believe  we  will  be successful in negotiating agreements with a number of such
suppliers  and  manufacturers.

     To date, all of our sales revenue has been generated from customers located
in  the  United  States.

     Cost  of  Goods  Sold.  Cost  of goods sold consists of our cost to acquire
products  from  manufacturers  and  suppliers  for  resale  to commissaries.  In
instances  where  we  sell  products  on a commission basis, there is no cost of
goods  sold because we act as an agent for the manufacturer or supplier and earn
only  a  commission on such sales. During the year ended December 31, 2001, cost
of  goods sold increased by $509,355, or approximately 13.5%, to $4,279,449 from
$3,770,094 for the year ended December 31, 2000.  This increase was attributable
primarily  to  the addition of new products in the 2001 fiscal year that we sell
on  a  resale  basis.

     Gross  Profit.  Gross profit for the year ended December 31, 2001 decreased
by  $138,227,  or  approximately  19.5%, compared to the year ended December 31,
2000,  from  $710,211  for  the year ended December 31, 2000 to $571,984 for the
year  ended  December  31, 2001.  This decrease was attributable primarily to an
increase  in  our inventory on hand as of December 31, 2001 compared to December
31,  2000.

     Operating  Expenses.  Total  operating  expenses  aggregated  approximately
$1,271,223  for  the  year  ended December 31, 2001 as compared to approximately
$711,763  for  the  year  ended  December  31, 2000, representing an increase of
$559,460,  or approximately 44.0%.  The increase in total operating expenses for
the  2001  period  was  attributable primarily to increased professional fees of
approximately  $103,000  resulting  primarily  from  the  costs  of  the Reverse
Acquisition  in  November  2001  and  the  costs  of  the  preparation  of  the
registration  statement  under  the  Securities  Act  of  1933  relating to this
offering;  increased  occupancy  expense of approximately $75,000 resulting from
our  move to larger office and warehouse facilities in September 2001; increased
salary  and  wages  of  approximately  $54,000  due primarily to the addition of
office  and  warehouse  personnel  and,  to  a  lesser  extent, increased wages;
increased  general  and administrative expenses of $284,734 due primarily to the
issuance  of  875,000  shares of our common stock in the fourth quarter as bonus
compensation  to  certain employees and directors for services rendered in 2001;
and  increased  trucking  expense  of approximately $42,000 due primarily to the
addition  of  one  truck  and  the  renewal of two truck leases at higher rates.

     Interest  Expense.  Interest expense of $46,755 for the year ended December
31,  2001  reflected  an  increase of $34,634 as compared to interest expense of
$12,121  for the year ended December 31, 2000.  The increase in interest expense
was attributable primarily to interest expense resulting from the recognition of
the  beneficial conversion feature (the right to convert debt into shares of our
common  stock  at  a  discount  to the fair market value of our common stock) of
$35,000 aggregate principal amount of convertible promissory notes issued in the
fourth  quarter  of  2001.

     Net Loss.  Primarily as a result of the increased expenses discussed above,
we  incurred  a  net  loss  of  $745,994 for the year ended December 31, 2001 as
compared  to  a  net  loss  of  $13,673  for  the  year ended December 31, 2000.

                                        3
<PAGE>

LIQUIDITY  AND  CAPITAL  RESOURCES

     At  December  31, 2001, we had a zero cash balance. Our principal source of
liquidity  has  been  borrowings.   Since  November  2001,  we  have  funded our
operations  primarily  from borrowings of approximately $410,000.  In the fourth
quarter  of  2001  and the first and second quarters of 2002, we issued $260,000
aggregate  principal amount of convertible promissory notes (the "9% Convertible
Notes") that mature on December 31, 2002 and bear interest at the rate of 8% per
annum  prior  to  June  30,  2002  and  9% per annum thereafter.  In April 2002,
$150,000  aggregate principal amount of 9% Convertible Notes (and $2,380 accrued
interest  thereon)  was  converted by the holders into an aggregate of 1,993,573
shares  of our common stock.  The remaining 9% Convertible Notes are convertible
at any time and from time to time by the noteholders into a maximum of 1,153,900
shares of our common stock (subject to certain anti-dilution adjustments) if the
9% Convertible Notes are not in default, or a maximum of 2,307,800 shares of our
common  stock  (subject  to  certain  anti-dilution  adjustments) if an event of
default  has  occurred in respect of such notes. The terms of the 9% Convertible
Notes  require  us  to  register under the Securities Act of 1933 the shares our
common stock issuable upon conversion of the 9% Convertible Notes not later than
December  31,  2002.

     In the third quarter of 2002, we issued $105,000 aggregate principal amount
of  convertible  promissory  notes  (the  "8% Convertible Notes") that mature on
either  June  30,  2003 or July 30, 2003 and bear interest at the rate of 8% per
annum.  The  8%  Convertible  Notes are convertible at any time and from time to
time  by  the  noteholders  into a maximum of 489,667 shares of our common stock
(subject  to certain anti-dilution adjustments). The terms of the 8% Convertible
Notes  require us to register under the Securities Act of 1933 the shares of our
common stock issuable upon conversion of the 8% Convertible Notes not later than
December  31,  2002.

     Our  current  cash  levels,  together  with the cash flows we generate from
operating  activities,  are  not sufficient to enable us to execute our business
strategy.  As a result, we intend to seek additional capital through the sale of
up to 5,000,000 shares of our common stock.  In December 2001, we filed with the
Securities  and  Exchange  Commission  a registration statement relating to such
shares.  Such  registration  statement  has not yet been declared effective, and
there  can  be  no  assurance  that  the Securities and Exchange Commission will
declare such registration statement effective in the near future, if at all.  In
the interim, we intend to fund our operations based on our cash position and the
near term cash flow generated from operations, as well as additional borrowings.
In  the  event  we sell only a nominal number of shares (i.e. 500,000 shares) in
our  proposed  offering, we believe that the net proceeds of such sale, together
with  anticipated  revenues from sales of our products, will satisfy our capital
requirements  for  at  least  the  next  12  months.  However,  we would require
additional  capital  to  realize  our  strategic  plan  to  expand  distribution
capabilities  and  product  offerings.  These conditions raise substantial doubt
about  our ability to continue as a going concern.  Our actual financial results
may  differ  materially  from  the  stated  plan  of  operations.

     Assuming  that  we  receive  a nominal amount of proceeds from our proposed
offering  of  common  stock,  we expect capital expenditures to be approximately
$200,000  during  the  next  twelve  months, primarily for the acquisition of an
inventory  control  system.  It is expected that our principal uses of cash will
be  to  provide  working  capital,  to  finance  capital  expenditures, to repay
indebtedness  and  for  other  general  corporate  purposes, including sales and
marketing  and  new  business  development.  The  amount  of  spending  for  any
particular  purpose  is  dependent  upon  the total cash available to us and the
success  of  our  offering  of  common  stock.

     At  December  31,  2001,  we  had  liquid assets of $441,058, consisting of
accounts  receivable  derived  from  operations,  and  other  current  assets of
$279,544,  consisting  primarily  of  inventory  of  products  for  sale  and/or
distribution.  Long  term  assets  of  $192,411 consisted primarily of warehouse
equipment  used  in  operations.

     Current  liabilities  of  $1,369,735  at  December  31,  2001  consisted of
$1,047,207  of  accounts  payable  and $260,522 for the current portion of notes
payable,  of  which  approximately  $210,000  was payable to our officers or our
other  affiliates.

     Our  working  capital  deficit was $649,133 as of December 31, 2001 for the
reasons  described  above.

                                        4
<PAGE>

     We  used  cash  of  $87,386  in  operating activities during the year ended
December  31,  2001,  primarily  as a result of the net loss incurred during the
periods.

     We  used net cash of $123,502 in investing activities during the year ended
December  31,  2001,  all  of  which  was  used  for  capital  expenditures.

     Financing activities consisting primarily of short-term borrowings provided
net  cash  of  $211,338  during  the  year  ended  December  31,  2001.

ITEM  7.  FINANCIAL  STATEMENTS

     Our financial statements for the years ended December 31, 2001 and 2000 are
attached  and  included  as  a  part  of  this  report.


                                        5
<PAGE>


                                   SIGNATURES

     Pursuant  to  the  requirements  of  Section  13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its  behalf  by  the undersigned thereunto duly authorized, in Colorado Springs,
Colorado,  on  November  4,  2002

                                  MILITARY  RESALE  GROUP,  INC.



                                  By:  /s/Ethan  D.  Hokit
                                       -------------------
                                       Ethan  D.  Hokit
                                       President  and  Chief  Operating  Officer


     Pursuant  to  the requirements of the Securities Exchange Act of 1934, this
report  has  been  signed  below  by  the  following  persons  on  behalf of the
Registrant  and  in  the  capacities  and  on  the  dates  stated:

<TABLE>
<CAPTION>

<BTB>

<S>  <C>                    <C>                                       <C>

     SIGNATURE                       TITLE                                   DATE

/s/Edward  T.  Whelan       Chairman  of  the  Board,                 November  4,  2002
----------------------      Chief  Executive Officer
Edward  T.  Whelan          (Principal  Executive  Officer)

/s/Ethan  D.  Hokit          President, Chief Operating Officer,      November  4, 2002
----------------------       Director (Principal Accounting Officer
Ethan D. Hokit               and Principal Financial Officer)

/s/Richard  H.  Tanenbaum    Director                                 November  4,  2002
--------------------------
Richard  H.  Tanenbaum

</TABLE>

                                        6
<PAGE>

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER
                           Pursuant to 18 U.S.C. 1350
                 (SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002)

I,  Edward  T.  Whelan,  certify  that:

1.  I  have reviewed this annual report on Form 10-KSB of Military Resale Group,
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  officers  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  have:

a)  designed  such  disclosure  controls  and procedures to ensure that material
information relating to the registrant, including its consolidated 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 officers 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
functions):

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  officers  and I have indicated in this
annual  report whether 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.



                                           By:  /s/  Edward  T.  Whelan
                                           ------------------------------------
                                           Name:   Edward  T. Whelan
                                           Title:  Chief  Executive  Officer

NOVEMBER  4,  2002

                                       7
<PAGE>
                  CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER
                           Pursuant to 18 U.S.C. 1350
                 (SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002)

I,  Ethan  D.  Hokit,  certify  that:

1.  I  have reviewed this annual report on Form 10-KSB of Military Resale Group,
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  officers  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  have:

a)  designed  such  disclosure  controls  and procedures to ensure that material
information relating to the registrant, including its consolidated 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 officers 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
functions):

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  officers  and I have indicated in this
annual  report whether 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.



                              By:  /s/  Ethan  D.  Hokit
                                   ------------------------------------
                                     Name:   Ethan D. Hokit
                                     Title:  Chief  Financial  Officer

November  4,  2002

                                       8























                          INDEX TO FINANCIAL STATEMENTS

                                                                           Page

Report of Independent Auditors                                              F-2

Balance Sheets as of December 31, 2000 and 2001                             F-3

Statements of Operations for the years ended December 31, 2000 and 2001     F-4

Statements of Cash Flows for the years ended December 2000 and 2001         F-5

Statements  of  Shareholders'  Equity  for the years ended
December 31, 2000 and 2001                                                  F-6

Notes to Financial Statements                                               F-7

                                        F-1
<PAGE>

                         REPORT OF INDEPENDENT AUDITORS

                          INDEPENDENT AUDITOR'S REPORT


Board  of  Directors
Military  Resale  Group,  Inc.
Colorado  Springs,  Colorado


We  have  audited the accompanying balance sheets of Military Resale Group, Inc.
as  of  December  31,  2001  and 2000, and the related statements of operations,
stockholders'  equity  and  cash flow for the 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.  Those  standards  require that we plan and perform the
audits to obtain reasonable assurance about whether the financial statements are
free  of  material  misstatement.  An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.  An
audit  also  includes  assessing  the accounting principles used and significant
estimates  made  by  management,  as  well  as  evaluating the overall financial
statement  presentation.  We  believe that our audits provide a reasonable basis
for  our  opinion.

In  our  opinion,  the financial statements referred to above present fairly, in
all  material  respects, the financial positions of Military Resale Group, Inc.,
as  of December 31, 2001 and 2000, and the results of their operations and their
cash  flows  for  the  years  ended,  in  conformity  with accounting principles
generally  accepted  in  the  United  States.

The  accompanying  financial  statements  have  been  prepared assuming that the
Company  will  continue  as  a  going  concern.  As  discussed  in Note 8 to the
financial  statements,  the  Company's  recurring losses from operations and its
difficulties  in  generating  sufficient  cash  flow  to meet its obligation and
sustain  its operations raise substantial doubt about its ability to continue as
a going concern.  Management's plans concerning these matters are also described
in  Note  8.  The financial statements do not include any adjustments that might
result  from  the  outcome  of  this  uncertainty.

                                   MICHAEL  B.  JOHNSON  &  CO.,  LLC

                                   By:  /s/Michael  B.  Johnson
                                        -----------------------
                                           Michael  B.  Johnson

Denver,  Colorado
February  18,  2002
October  25,  2002

                                      F-2

<PAGE>
                               MILITARY RESALE GROUP, INC.
                                 Balance Sheets
                                  December 31,

<TABLE>
<CAPTION>

ASSETS                                                            2001              2000
                                                                  ----              ----
<S>                                                          <C>               <C>
CURRENT ASSETS:
      Accounts receivable -trade ......................      $   441,058       $   457,574
      Inventory .......................................          252,430            90,936
      Deposits ........................................           20,406              --
      Prepaid expenses ................................            6,708              --
                                                             -----------       -----------

Total Current Assets ..................................          720,602           548,510
                                                             -----------       -----------

FIXED ASSETS:
      Office Equipment ................................            9,121             1,691
      Warehouse Equipment .............................          203,132            83,110
      Vehicles ........................................           64,366            64,366
      Leasehold Improvements ..........................            2,440             2,440
      Software ........................................           15,609            15,609
                                                             -----------       -----------
                                                                 294,668           167,216
      Less Accumulated Depreciation ...................         (102,257)          (67,217)
                                                             -----------       -----------
         Net Fixed Assets .............................          192,411            99,999
                                                             -----------       -----------
OTHER ASSETS:
      Goodwill , net of amortization ..................             --               1,834
                                                             -----------       -----------

TOTAL ASSETS ..........................................      $   913,013       $   650,343
                                                             ===========       ===========

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
      Accounts Payable - trade ........................      $ 1,047,207       $   544,698
      Bank Overdraft ..................................            1,349            38,223
      Accrued Interest Payable ........................           60,657            23,540
      Notes Payable - current portion .................          260,522            86,073
                                                             -----------       -----------
       Total Current Liabilities ......................        1,369,735           692,534
                                                             -----------       -----------

LONG-TERM DEBT:
      Notes Payable - long-term portion ...............           91,121            17,358
                                                             -----------       -----------
      Total Long-term Debt ............................           91,121            17,358
                                                             -----------       -----------

TOTAL LIABILITIES .....................................        1,460,856           709,892
                                                             -----------       -----------

STOCKHOLDERS' EQUITY:
      Common Stock, par value $.0001, 60,000,000 shares
      7,505,004 and 5,360,000 issued and outstanding at
       December 31, 2001 and 2000 respectively ........              750               536
      Additional Paid-In Capital ......................          407,150           149,664
      Retained Deficit ................................         (955,743)         (209,749)
                                                             -----------       -----------
      Total Stockholders' Equity ......................         (547,843)          (59,549)
                                                             -----------       -----------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY ............      $   913,013       $   650,343
                                                             ===========       ===========
</TABLE>


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

                                      F-3
<PAGE>

                          MILITARY RESALE GROUP, INC.
                            Statement of Operations
                        for the years ended December 31,



                                      2001              2000
                                      ----              ----

REVENUES:
Gross Sales ................      $ 4,560,347       $ 4,032,275
Commissions sales - net ....          291,086           448,030
                                  -----------       -----------

 Total Revenues ............        4,851,433         4,480,305
                                  -----------       -----------

COST OF GOODS SOLD .........       (4,279,449)       (3,770,094)
                                  -----------       -----------

GROSS PROFIT ...............          571,984           710,211
                                  -----------       -----------
OPERATING EXPENSES:
Salary & payroll taxes .....          415,525           361,623
Professional Fees ..........          153,856            50,795
Occupancy ..................          155,503            80,805
General and administrative .          333,881            49,147
Amortization/Depreciation ..           36,874            36,039
Lease and auto/truck expense          175,584           133,354
                                  -----------       -----------
Total Expenses .............        1,271,223           711,763
                                  -----------       -----------

NET LOSS FROM OPERATIONS ...         (699,239)           (1,552)
                                  -----------       -----------

OTHER INCOME/(EXPENSES)
Interest expense ...........          (46,755)          (12,121)
                                  -----------       -----------

NET LOSS ...................      $  (745,994)      $   (13,673)
                                  ===========       ===========

Per Share Information:
Weighted average number
of common shares outstanding        5,644,584         5,360,000
                                  -----------       -----------

Net Loss per common share ..      $     (0.13)      $     (0.01)
                                  ===========       ===========




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


                                      F-4

<PAGE>
                          MILITARY RESALE GROUP, INC.
                  Statement of Stockholders' Equity (Deficit)

<TABLE>
<CAPTION>

                                                     Common Stock             Additional      Retained        Total
                                                  ---------------------        Paid-In        Earnings      Stockholders'
                                                 Shares         Amount         Capital       (Deficit)        Equity
--------------------------------------------     ------         ------   -------------   -------------   -------------
<S>                                           <C>            <C>            <C>             <C>            <C>
Balance, October 6, 1997 ...............           --        $    --        $    --         $    --         $    --

Issuance of common stock for cash ......        800,000             80            120            --               200
Net loss for period ended ..............           --             --             --            (6,756)         (6,756)
                                              ---------      ---------      ---------       ---------       ---------
Balance, December 31, 1997 .............        800,000             80            120          (6,756)         (6,556)
                                              ---------      ---------      ---------       ---------       ---------
Issuance of common stock for cash ......         40,000              4         14,996            --            15,000
Issuance of common stock for services ..      3,000,000            300           (300)           --              --
Net loss for year ended ................           --             --             --           (43,372)        (43,372)
                                              ---------      ---------      ---------       ---------       ---------
Balance, December 31, 1998 .............      3,840,000            384         14,816         (50,128)        (34,928)
                                              ---------      ---------      ---------       ---------       ---------
Issuance of common stock ...............      1,520,000            152        134,848            --           135,000
Net loss for year ended ................           --             --             --          (145,948)       (145,948)
                                              ---------      ---------      ---------       ---------       ---------
Balance, December 31, 1999 .............      5,360,000            536        149,664        (196,076)        (45,876)
                                              ---------      ---------      ---------       ---------       ---------

Net loss for year ended ................           --             --             --           (13,673)        (13,673)
                                              ---------      ---------      ---------       ---------       ---------
Balance, December 31, 2000 .............      5,360,000            536        149,664        (209,749)        (59,549)
                                              ---------      ---------      ---------       ---------       ---------

Issuance of common stock for services ..        875,000             87        253,663            --           253,750
Acquisition of Bactrol Technologies, Inc      1,270,004            127          3,823            --             3,950
Net loss for year ended ................           --             --             --          (745,994)       (745,994)
                                              ---------      ---------      ---------       ---------       ---------
Balance, December 31, 2001 .............      7,505,004      $     750      $ 407,150       $(955,743)      $(547,843)
                                              ---------      ---------      ---------       ---------       ---------
</TABLE>


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


                                      F-5
<PAGE>

                          MILITARY RESALE GROUP, INC.
                            Statement of Cash Flows
                        For the years ended December 31,
<TABLE>
<CAPTION>
                                                             2001             2000
                                                             ----             ----
<S>                                                       <C>             <C>
Cash Flows from Operating Activities:
       Net Loss ....................................      $(745,994)      $ (13,673)
       Adjustments to reconcile net loss to net cash
         used in operating activities:
         Depreciation ..............................         35,040          35,039
         Amortization ..............................          1,834           1,000
         Stock issued for services .................        253,750            --
         Changes in Assets & Liabilities:
         Decrease (Increase) in accounts receivable          16,516        (157,932)
         (Increase) in inventory ...................       (161,494)           (202)
         Increase in prepaid expenses ..............         (6,708)           --
         Increase in notes receivable ..............        (20,406)           --
         Increase in accounts payable ..............        502,509         135,130
         Increase in accrued expenses ..............         37,117           7,758
                                                          ---------       ---------
Net Cash Used In Operating Activities ..............        (87,836)          7,120
                                                          ---------       ---------

CASH FLOWS FROM INVESTING ACTIVITIES
       Acquisition of business .....................          3,950            --
       Purchase of fixed assets ....................       (127,452)        (14,515)
                                                          ---------       ---------
Cash Flows Used In Investing Activities ............       (123,502)        (14,515)
                                                          ---------       ---------

CASH FLOWS FROM FINANCING ACTIVITIES
       Bank overdraft ..............................        (36,874)         38,223
       Short-term borrowings .......................        248,212            --
       Note principal payments .....................           --           (34,604)
                                                          ---------       ---------
Cash Flows Provided By Financing Activities ........        211,338           3,619
                                                          ---------       ---------

Net (Decrease) Increase in Cash and Cash Equivalents           --            (3,776)

Cash and Cash Equivalents at Beginning of Period ...           --             3,776
                                                          ---------       ---------

CASH AND CASH EQUIVALENTS AT END OF PERIOD .........      $    --         $    --
                                                          =========       =========


SUPPLEMENTAL INFORMATION:
       Interest Paid ...............................      $   9,263       $   4,365
                                                          =========       =========
       Income Taxes Paid ...........................      $    --         $    --
                                                          =========       =========
</TABLE>



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


                                      F-6
<PAGE>
                           MILITARY RESALE GROUP, INC.
                          NOTES TO FINANCIAL STATEMENTS


NOTE  1  -  GENERAL
            -------

THE  COMPANY

     On  October  15, 2001, the Company, formerly Bactrol Technologies, Inc. and
Military  Resale Group, Inc. ("MRG"), a Maryland corporation which was formed on
October  6,  1997 executed a Stock Purchase Agreement pursuant to which 98.2% of
MRG's  stock  was effectively exchanged for a controlling interest in a publicly
held  "shell"  corporation that concurrently changed its name to Military Resale
Group, Inc. This transaction is commonly referred to as a 'reverse acquisition."
For  financial  accounting  purposes,  this  transaction has been treated as the
issuance  of  stock for the net monetary assets of the Company, accompanied by a
recapitalization  of  MRG  with no goodwill or other intangible assets recorded.

     For  financial  reporting  purposes,  MRG  is  considered the acquirer, and
therefore,  the  historical  operating results of Bactrol Technologies, Inc. are
not  presented.


NOTE  2  -  SUMMARY  OF  SIGNIFICANT  ACCOUNTING  POLICIES:
            -----------------------------------------------

CASH  AND  CASH  EQUIVALENTS

     For purposes of the statement of cash flows, the Company considers all cash
and highly liquid investments with initial maturities of three months or less to
be  cash  equivalents.

ACCOUNTS  RECEIVABLE

     The  Company's  trade  accounts  primarily represent unsecured receivables.
Historically,  the Company's bad debt write-offs related to these trade accounts
have  been  insignificant.

PROPERTY  AND  EQUIPMENT

     The  Company  follows  the  practice of capitalizing property and equipment
over  $250  at cost.  The cost of ordinary maintenance and repairs is charged to
operations  while  renewals  and  replacements are capitalized.  Depreciation is
computed  on the straight-line method over the following estimated useful lives.

     Office  Equipment  &  Software     3  to  5  years
     Warehouse  Equipment               5  to  7  years
     Vehicles                           5  years

ESTIMATES

     The  preparation  of  financial  statements  in  conformity with accounting
principles  generally accepted in the United States, requires management to make
estimates  and  assumptions  that  affect  the  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 revenue and expenses during
the  reporting  period.  Actual  results  could  differ  from  those  estimates.

NET  LOSS  PER  SHARE

     Net loss per share is based on the weighted average number of common shares
and  common  shares  equivalent  outstanding  during  the  period.


                                      F-7
<PAGE>

REVENUE  RECOGNITION

          The  Company's  revenues are derived in either one of two ways: resale
revenue  or  commission  revenue.

     Resale  Revenue.     In  the  majority  of instances, the Company purchases
products  from  manufacturers  and  suppliers for resale to the commissaries its
services. Revenue is recognized in the amount of the gross sales amount received
by  the  Company (subject to an appropriate provision for returns and allowances
from  such  sales), which includes (i) the purchase price paid by the commissary
plus  (ii)  a  negotiated  storage  and delivery fee paid by the manufacturer or
supplier. The Company records revenue on a gross sales basis because the Company
(a)  is  the  primary  obligor  in  the  transaction  as  it  is responsible for
fulfillment  of  the  order  and  for  the customer's acceptance of the goods or
services  sold, (b) bears inventory risk (it takes title to the goods before the
customer's  order  is  placed  or  upon  the  customer's  return), and (c) bears
physical  loss  of  inventory  risk.

     Commission  Revenue.     In the remaining instances, the Company acts as an
agent  for  the  manufacturer  or supplier of the products it sells, and earns a
commission paid by the manufacturer or supplier, generally in an amount equal to
a  percentage  of  the manufacturer's or supplier's gross sales amount.  In such
cases,  revenue is recognized on the date goods are shipped in the amount of the
commission  received  by  the  Company  on  the  gross  sales  amount.

     The  Company  recognizes  both resale revenue and commission revenue on the
date  goods  are  shipped  because  title  to  the goods passes, and the payment
obligation  of  the customer or supplier to the Company arises, upon shipment of
the  goods  to  the  commissaries.

     The  Company believes that adoption of Staff Accounting Bulletin (SAB) 101-
"Revenue  Recognition  in  Financial  Statements" had no effect on its financial
statements.

COMPENSATORY  EQUITY  ISSUANCES

     The  Company  applies  the  disclosure-only  provisions  of  Statement  of
Financial  Accounting  Standards  No.  123,  "Accounting  for  Stock-Based
Compensation"  (SFAS  No.  123)  for options granted to employees, directors and
non-employees.  As  allowed  under  the  provisions of SFAS No. 123, the Company
applies  Accounting  Principal Board Opinion No. 25 and related interpretations,
in  accounting  for  its  stock  plans.

     Information  with  respect  to  all  stock  options  is  summarized  below:

                                                      Weighted
                                    2001  Plan     Average  Exercise
                                      Options            Price
                                    ----------     ------------------
Outstanding at December 31, 2000
Granted                              1,000,000        $0.50
Exercised                                    0            0
Expired                                              0            0
                                    ----------     --------
Outstanding at December 31, 2001     1,000,000        $0.50
                                    ==========     ========


     On  August  1,  2001,  in  connection  with  a  consulting arrangement, the
Company,  issued  options  to  purchase  1,000,000  shares of common stock at an
exercise  price of $0.50 per share, which price was in excess of the fair market
value  of  the common stock on the date of grant.  The options expired on August
1, 2002.  As none of such options were exercised prior to expiration, no amounts
have  been  accrued  in  respect  of  such  options.

                                      F-8
<PAGE>

     In  2001,  the Company issued 875,000 shares of its restricted common stock
to  participating  employees  based  upon  salary  levels  and  minimum  service
requirements.  Compensation  costs  of $0.29 per share (representing the closing
bid  price  on  the  date  of  issuance  of  $0.32  per share less a discount of
approximately  10% due to the fact that such shares were " restricted stock" and
were  subject to statutory transfer restrictions on the date of issue) have been
charged  against  operations  for  2001.

FAIR  VALUE  OF  FINANCIAL  INSTRUMENTS

     The carrying amount of accounts payable and accrued expenses are considered
to  be  representative of their respective fair values because of the short-term
nature  of  these  financial  instruments.

OTHER  COMPREHENSIVE  INCOME

     The Company has no material components of other comprehensive income (loss)
and  accordingly,  net  loss  is  equal  to  comprehensive  loss in all periods.

FEDERAL  INCOME  TAXES

     The Company accounts for income taxes under SFAS No 109, which requires the
asset  and  liability  approach  to  accounting  for  income  taxes.  Under this
approach,  deferred  income  taxes are determined based upon differences between
the  financial  statement  and tax bases of the Company's assets and liabilities
and operating loss carryforwards using enacted tax rates in effect for the years
in  which  the  differences  are  expected  to  reverse. Deferred tax assets are
recognized  if  it  is  more likely than not that the future tax benefit will be
realized.

NOTE  2      INVENTORY
             ---------

     Inventories at December 31, 2001 by major classification, were comprised of
the  following:

          Finished  goods                                $252,430
                                                         --------
                                                         $252,430
                                                         ========

     Inventory  consists  primarily of grocery items and are stated at the lower
of  costs  or  market.  Cost  is determined under the first-in, first-out method
(FIFO)  valuation  method.  All  items of inventory are finished goods resold to
military  commissaries  and  wholesale  food  chains.

SEGMENT  INFORMATION

     The  Company operates primarily in a single operating segment, distributing
and  marketing  resale  grocery  products  to  military  commissaries.

                                      F-9
<PAGE>

NOTE  3  -  NOTES  PAYABLE
            --------------

     The  following  is  a  summary  of  notes  payable as of December 31, 2001:

<TABLE>
<CAPTION>

<BTB>
<S>       <C>                                                                        <C>
          Note  payable  to  finance  company,  collateralized  by auto, monthly
          payments  of  $1,053,  maturity  date  -  June  2003                       $  18,240
          Note  payable to investment company, unsecured loan, 10% interest, Due
          on  demand                                                                    60,000
          Note  payable  -  freezer,  secured  by property leased, 19% interest,
          Maturity  dated  October  2006                                                72,266
          Note  payable  -  cooler,  secured  by  property leased, 24% interest,
          Maturity  date  November  2004                                                31,137
          Convertibles  Notes,  unsecured  loan,  8%  interest,  maturity  date
          December  31,  2002                                                           35,000
          Notes  payable,  unsecured,  8%  interest,  due  on  demand                  135,000
                                                                                     ==========
                                                                                       351,643
          Less:  Current  Portion                                                     (260,522)
                                                                                     ----------
     Total  Long-Term  Debt                                                          $  91,121
                                                                                     ==========

</TABLE>

Maturities  of  long-term  debt  at  December  31,  2001,  were  as  follows:

                        2002       $260,522
                        2003         28,963
                        2004         25,807
                        2005         17,311
                        2006         19,040
                                   --------
                       Total       $351,643
                                   ========

     The  terms  of  the Company's convertible notes provide generally, that, if
the  convertible  notes are not in default, the holders may convert, at any time
and  from  time  to time, all or a portion of the outstanding balance under each
convertible  note  into  a  number  of  shares (subject to certain anti-dilution
adjustments)  of  the  Company's  common stock that will allow the noteholder to
receive  common  stock  having  a  market  value  equal to 150% of the converted
balance  of  the  note.  If  an event of default has occurred in respect of such
convertible  notes, the holder may convert the outstanding balance into a number
of shares (subject to certain anti-dilution adjustments) of the Company's common
stock  equal  to  twice  the  number  of  shares the holder would have otherwise
received  if  the  convertible notes were not in default.  Among other events of
default,  the  terms  of  the  convertible notes require the Company to register
under  the  Securities  Act  of  1933  the shares its common stock issuable upon
conversion  of  the  convertible  notes  not  later  than  December  31,  2002.

     The  Company  follows  EITF  98-5  in accounting for convertible notes with
"beneficial  conversion  features" (i.e., the notes may be converted into common
stock at the lower of a fixed rate at the commitment date or a fixed discount to
the  market  price  of  the  underlying  common  stock  at the conversion date).
Because  the  Company's  convertible  notes  contained  a  beneficial conversion
feature  on  the  date  of  issuance,  the  Company  measured and recognized the
intrinsic  value  of  the beneficial conversion feature of the convertible notes
when  the  convertible  notes  were  issued.  During the year ended December 31,
2001,  interest  expense  of $35,000 (representing the aggregate proceeds to the
Company from convertible notes issued during such period), was recognized as the
intrinsic  value  of  the beneficial conversion feature of the convertible notes
that  were  issued  during  such  period.


                                      F-10
<PAGE>


NOTE  4  -  COMMITMENTS  AND  CONTIGENCIES
          --------------------------------

OPERATING  RENTAL  LEASE

     In  August  2001,  the Company entered into lease agreements for office and
warehouse space in Colorado Springs, Colorado that expire in August 2006. Rental
expense  for  the  year  was  $80,805.

Minimum  future  lease  payments  under current lease agreements at December 31,
2001  are  as  follows:

              2002      $182,839
              2003       191,030
              2004       199,216
              2005       207,402
              2006       141,908
                        --------
                        $922,395
                        ========

NOTE  5-  CAPITAL  STOCK  TRANSACTION
          ---------------------------

     On May 24, 1999, the Company's Board of Directors and shareholders approved
the  following  capital  stock  transaction:  authorizing a 40,000-to-1 split of
common  stock.  On  October  15,  2001,  the  Company's  Board  of Directors and
shareholders  authorized  increasing  the  number of authorized common shares to
60,000,000 and designating a par value of $.0001 per share for the Common Stock.
All shares and per share amounts in the accompanying financial statements of the
Company and notes thereto have been retroactively adjusted to give effect to the
stock  splits  and  new  par  value  per  share.

NOTE  6-  CONCENTRATION  OF  RISK
          -----------------------

     The Company's revenues from military commissary sales provide approximately
ninety  eight  percent  of  their  base of operations.  Management believes that
concentration  of  customers  with  respect  to risk is minimal due to the sales
being  primary  through  government  contracts.

NOTE  7-  INCOME  TAXES
          -------------

     Significant components of the Company's deferred tax liabilities and assets
at  December  31,  2001  are  as  follows:

     Deferred  Tax  Assets
          Net  Operating  Loss  Carryforwards            $955,743
          Less  Valuation  Allowance                     (955,743)
                                                         ---------
          Total  Deferred  Tax  Assets                   $      -
                                                         =========

     As  of December 31, 2001, the Company had a net operating loss carryforward
for  federal  income tax purposes approximately equal to the accumulated deficit
recognized  for  book purposes, which will be available to reduce future taxable
income.  The  full  realization  of  the  tax  benefit  associated  with  the
carryforward  depends  predominantly  upon  the  Company's  ability  to generate
taxable  income  during  the  carryforward  period.  Because  of  the  current
uncertainty  of  realizing  such tax assets in the future, a valuation allowance
has  been  recorded  equal  to  the amount of the net deferred tax assets, which
caused  the Company's effective tax rate to differ from the statutory income tax
rate. The net operating loss carryforward, if not utilized, will begin to expire
in  the  year  2007.

                                      F-11
<PAGE>


NOTE  8  -  GOING  CONCERN:
            --------------

     The financial statements have been prepared on a going concern basis, which
contemplates  continuity of operations, realization of assets and liquidation of
liabilities in the normal course of business.  The Company's current liabilities
exceed current assets by $649,133 and the Company lost $745,994 in operations in
2001.

     The Company's management is currently pursuing equity and/or debt financing
in  an effort to restart operations. The future success of the Company is likely
dependent  on  its  ability to attain additional capital to develop its proposed
products  and  ultimately,  upon  its  ability  to  attain  future  profitable
operations.  There  can  be  no assurance that the Company will be successful in
obtaining  such  financing,  or  that  it  will  attain  positive cash flow from
operations.

NOTE  9  -  RELATED  PARTY  TRANSACTIONS
            ----------------------------

CONSULTING  AGREEMENTS

     In  February  2001, the Company entered into a (11) eleven month consulting
agreement  with Edward Whelan , chairman of Board and principal shareholder, and
Edward  Meyer,  Jr.,  one  of the principals shareholders.  In consideration for
consulting  services rendered, the Company issued 145,000 shares of common stock
to  each  individual.

     In  January  2002,  the Company entered into a one-year business consulting
agreement  with  Edward  Whelan  and  Edward  Meyer,  Jr.  for  the provision of
marketing  and  managerial consulting services. In consideration of the services
to be rendered by Messrs. Whelan and Meyer, the Company will issue in respect of
each month the number of shares determined by dividing $12,000 by the product of
80% and the average closing bid price for the Company's common stock during such
month.

LOANS  PAYABLE

     In  October  1997,  the  Company borrowed $60,000 from Shannon Investments,
which  is  controlled  by Edward Whelan. The note is payable on demand and bears
interest  at  the  rate  of  10%  per  annum.

     On  August  14,  2001,  the  Company borrowed $100,000 from Oncor Partners,
Inc.,  a  company  of  which  Edward  Whelan,  is  president  and  shareholder.

     In December 2001, the Company borrowed $25,000 from Ethan Hokit, one of the
company's  directors, and Atlantic Investment Trust, of which Richard Tanenbaum,
one of the Company's directors is a trustee.  In connection with each such loan,
the Company executed a demand promissory note that bears interest at the rate of
8%  per  annum.

     In  December 2001, the Company issued $35,000 aggregate principal amount of
convertible  notes to two purchasers. Such notes are convertible at any time and
from  time  to  time  by the noteholders into a maximum of 367,150 shares of the
Company's  common  stock  (subject to certain anti-dilution adjustments) if such
convertible  notes  are  not  in  default, or a maximum of 734,300 shares of the
Company's  common  stock  (subject  to  certain anti-dilution adjustments) if an
event of default has occurred in respect of such convertible notes. The terms of
such  convertible notes require the Company to register under the Securities Act
of 1933 the shares its common stock issuable upon conversion of such convertible
notes  not  later  than  December  31,  2002.


                                      F-12
<PAGE>