UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q/A
AMENDMENT NO. 2
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2002.
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ________________ to ________________
Commission File Number: 33-42498
SUN NETWORK GROUP, INC.
(Exact name of registrant as specified in its charter)
FLORIDA 65-024624
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1440 CORAL RIDGE DRIVE, # 140
CORAL SPRINGS, FL 330771
(954) 360-4080
(Address, including zip code, and telephone number,
including area code, of registrant's
principal executive offices)
(Former name, former address and former fiscal year,
if changed since last report)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 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
--- ---
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court.
Yes No
--- ---
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
COMMON STOCK - 22,448,487 shares outstanding as of September 30, 2002.
EXPLANATORY NOTE
The purpose of this amendment to the company's quarterly report on Form
10-Q and 10-Q/A Amendment No. 1, is to revise the section RECENT DEVELOPMENTS
and to correct the certifications pursuant to Sections 302 and 906 of the
Sarbanes-Oxley Act of 2002.
PART I - FINANCIAL INFORMATION
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
RECENT DEVELOPMENTS
On June 27, 2002 the Company entered into agreement with four (4) institutional
investors to provide the Company $750,000 in capital through a Secured
Convertible Debenture Offering ("Debenture"). The Company has filed a SB-2
Registration Statement and, subsequently, a SB-2A amended Registration Statement
in connection with the Debenture and anticipates receiving the full funding from
the Debenture by the end of 2002. As of September 30, 2002 the Company had
received $500,000 of the Debenture financing.
Other than the above-referenced $750,000, the investors are not obligated to
invest $3,000,000 that was reported in a press release dated July 5, 2002.
2
On June 28, 2002 the Company entered into an Option Agreement and Plan of Merger
("Agreement") to acquire all of the assets of Live Media Enterprises, Inc
("Live"), a west coast based independent producer of consumer lifestyle events.
On September 3, 2002 the Company elected to terminate the Agreement with Live
and will not proceed with the acquisition even on modified terms. In connection
with the Agreement the Company has loaned Live the sum of $56,000. This loan is
documented in two Promissory Notes and is collateralized by, substantially, all
of the assets of Live and personally guaranteed by Live's principal shareholder
and officer.
On September 5, 2002 the Company entered into agreement with Sports Byline USA,
L.P. to own and operate a new, national radio network, Radio X. Radio X intends
to develop, produce, license, broadcast and distribute radio programs, targeted
to young males, that will be distributed via traditional terrestrial stations,
via satellite and over the Internet. The Company has contributed the fixed sum
of $100,000 to this business plus certain management services.
The Company intends to use the net proceeds from the Debenture to develop,
operate and expand the businesses of RTV and Radio X and to continue to seek
other opportunities for the Company. The Company believes that if it
successfully completes the Debenture, on a timely basis, it will have sufficient
capital to operate in the near-term. The Company will, however, continue to seek
additional capital to fund further development, expansion and operation of its
businesses. Upon conversion of the Debentures into the Company common stock
there will be substantial shareholder dilution.
SIGNATURES*
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
SUN EXPRESS GROUP, INC.
(Registrant)
Date: June 12, 2003 /s/ T. Joseph Coleman
----------------------------
T. Joseph Coleman, President,
Director, CEO and Acting CFO
Date: June 12, 2003 /s/ William H. Coleman
----------------------------
William H. Coleman,
Secretary and Director
3
CERTIFICATION
I, T. Joseph Coleman, CEO and Acting CFO, certify that:
1. I have reviewed this quarterly report on Form 10-Q and Form 10-Q/A Amendment
No. 1 of Sun Network Group, Inc.;
2. Based on my knowledge, this quarterly 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 quarterly
report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly 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 quarterly 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 we 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 quarterly 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
quarterly report (the "Evaluation Date"); and
c) Presented in this quarterly 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 function):
a) All significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to
record, process, summarize and report financial data and have identified
for the registrant's auditors any material weaknesses in internal
controls; and
b) Any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal
controls; and
6. The registrant's other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
Date: June 12, 2003 /S/ T. Joseph Coleman
T. Joseph Coleman
Chief Executive Officer and
Acting Chief Financial Officer