**FORM 10-K — ANNUAL REPORT PURSUANT TO SECTION 13OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**

 

**UNITED STATESSECURITIES AND EXCHANGE COMMISSION**

**Washington,DC 20549**

 

**FORM 10-K/A**

**(AmendmentNo. 1)**

 

| **(Mark  One)**                                  |                                                                                                                                                                                                                                                  |
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| **ý**                                       |                                                                                                                                                                                                                                                  | **Annual Report Pursuant to Section 13 or 15(d)  of the Securities Exchange Act of 1934** |   |
| **[Fee  Required]**                              |                                                                                                                                                                                                                                                  |
|                                             |                                                                                                                                                                                                                                                  |
| **For the  fiscal year ended December 31, 2002** |                                                                                                                                                                                                                                                  |
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| **or**                                           |                                                                                                                                                                                                                                                  |
|                                             |                                                                                                                                                                                                                                                  |
| **o**                                            |                                                                                                                                                                                                                                                  | **Transition Report Pursuant to Section 13 or  15(d) of the Securities Exchange Act of 1934** |   |
| **[No Fee  Required]**                           |                                                                                                                                                                                                                                                  |
|                                             |                                                                                                                                                                                                                                                  |
|                                             | **For the  transition period from                   to                   ** |
|                                             |                                                                                                                                                                                                                                                  |
|                                             | **Commission  File Number             0-14745**                                                                                                                                                |
|                                                  |                                                                                                                                                                                                                                                       |  |  |  |

 

| **Sun Bancorp, Inc.**                                                     |
|---------------------------------------------------------------------------|
| (Exact  name of registrant as specified in its charter)                   |
|                                                                      |   |   |
| **Pennsylvania**                                                          |   | **23-2233584** |
| (State or other  jurisdiction of  incorporation or organization)          |   | (I.R.S. Employer  Identification No.) |
|                                                                      |   |   |
| **155  North 15th Street, Lewisburg, PA**                                 |   | **17837** |
| (Address of principal  executive offices)                                 |   | (Zip Code) |
|                                                                      |   |   |
| Registrant’s telephone  number, including area code **570-523-4300** |

 

Securities registeredpursuant to Section 12(b) of the Act:

 

| **Title of each  class** |   | **Name of each  exchange on  which registered** |
|--------------------------|--------|-------------------------------------------------|
| None                     |   | None                                            |

 

Securities registeredpursuant to Section 12(g) of the Act:

 

| **Common  stock, No Par Value** |
|---------------------------------|
| (Title of Class)                |

 

 

Indicate by check markwhether the registrant (1) has filed all reports required to be filed bySection 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding12 months (or for such shorter period that the registrant was required to filesuch reports), and (2) has been subject to such filing requirements for thepast 90 days. ý Yes  o No

 

Indicate by check mark ifdisclosure of delinquent filers pursuant to Item 405 of Regulation S-K (Section229.405 of this Chapter) is not contained herein, and will not be contained, tothe best of registrant’s knowledge, in definitive proxy or informationstatements incorporated by reference in PART III of this Form 10-K or anyamendment to this Form 10-K.  ý

 

Indicate by check markwhether the registrant is an accelerated filer (as defined in Rule 12b-2 of theAct) ý Yes  o No

 

As of March 7, 2003, theRegistrant had 7,162,799 shares of common stock outstanding with a no parvalue.  Based on the closing price of$18.70 on the same date, the aggregate market value of the voting stock held bynonaffiliates of the Registrant was $133,944,341.

 

The index to exhibitsincluded in this filing appears on page 2.

 

 

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Explanatory Note

 

Sun Bancorp, Inc. (the“Company”) hereby amends the Company’s Annual Report on Form 10-K for thefiscal year ended December 31, 2002 (the “10-K”) to add the Company’s priorindependent accountant’s audit report, dated February 19, 2002 and to amendItem 8 of the 10-K.  The 10-K, except asindicated, has not been updated to reflect events occurring subsequent to theoriginal filing date.

 

PART II

 

ITEM 8 - FINANCIALSTATEMENTS AND SUPPLEMENTARY DATA

 

This item is incorporatedby reference to the Consolidated Financial Statements, Notes to ConsolidatedFinancial Statements and Independent Auditors’ Report set forth on pages 14through 38 of the 2002 Annual Report to Shareholders.

 

Independent Auditors’ Report

 

To the Shareholders and Board of Directors ofSUN BANCORP, INC:

 

We have audited the accompanying consolidated balance sheets of SunBancorp, Inc. and subsidiaries (Sun) as of December 31, 2001, and the relatedconsolidated statements of income, changes in shareholders’ equity and cashflows for each of the two years in the period then ended. These financialstatements are the responsibility of Sun’s management. Our responsibility is toexpress an opinion on these financial statements based on our audits.

 

We conducted our audits in accordance with auditing standards generallyaccepted in the United States of America. Those standards require that we planand perform the audit to obtain reasonable assurance about whether thefinancial statements are free of material misstatement. An audit includesexamining, on a test basis, evidence supporting the amounts and disclosures inthe financial statements. An audit also includes assessing the accountingprinciples used and significant estimates made by management, as well asevaluating the overall financial statement presentation. We believe that ouraudits provide a reasonable basis for our opinion.

 

In our opinion, the consolidated financial statements referred to abovepresent fairly, in all material respects, the financial position of SunBancorp, Inc. and subsidiaries as of December 31, 2001, and the results oftheir operations and their cash flows for each of the two years in the periodthen ended, in conformity with accounting principles generally accepted in theUnited States of America.

 
| /s/ Parente Randolph, PC   |   |
|----------------------------|--------|
|                       |
| Williamsport, Pennsylvania |
|                       |
| February 19, 2002          |

 

PART IV

 

ITEM 15 - EXHIBITS,FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

 

(a) (1) The followingconsolidated financial statements and independent accountants report of SUNBANCORP, INC. and subsidiaries included in the Annual Report to Shareholdersfor the year ended December 31, 2002 are incorporated by reference in Part II,Item 8:

 

Consolidated BalanceSheets - December 31, 2002 and 2001

 

Consolidated Statements ofIncome - Years Ended December 31, 2002, 2001, and 2000

 

Consolidated Statements ofChanges in Shareholders’ Equity - Years Ended December 31, 2002, 2001, and 2000

 

2

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Consolidated Statements ofCash Flows - Years Ended December 31, 2002, 2001, and 2000

 

Notes to ConsolidatedFinancial Statements

 

Independent AccountantsReport

 

(2)             All schedules applicable to theRegistrant are shown in the respective financial statements or the notesthereto.  Financial statement schedulesnot included are omitted because the information is not required under therelated instructions or it is inapplicable.

 

(3)             Exhibits
| 3(i)   |   | The Articles of  Incorporation of the Corporation are incorporated herein by reference to  Exhibit 3 to the Corporation’s Registration Statement on Form S-8 filed  with the Securities and Exchange Commission on August 12, 1998 (Commission  File Number 0-14745).                                                                                                                                                                      |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| 3(ii)  |   | The By-Laws, as amended  and restated, are incorporated herein by reference to Exhibit 3 to the  Corporation’s Annual Report on Form 10-K for the year ended December 31, 1993  (Commission File Number 0-14745).                                                                                                                                                                                                                               |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| 10     |   | Employment agreements  between Robert J. McCormack and Sun Bancorp, Inc. and SunBank dated October  31, 2002, Sandra Miller and Sun Bancorp, Inc. and SunBank dated October 24,  2002, Thomas W. Bixler and Sun Bancorp, Inc. and SunBank dated November 3,  2002, and Maureen M. Bufalino and Sun Bancorp, Inc. and SunBank dated May 31,  2001, are incorporated by reference to Form 8-K filed March, 20, 2003  (Commission File Number 0-14745). |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| 13     |   | Annual Report to  Shareholders of SUN BANCORP, INC. for the year ended December 31, 2002 is  filed herewith.  The report, except  for those portions thereof which are expressly incorporated by reference  herein, is furnished for information of the Securities and Exchange  Commission only and it is not considered “filed” as part of the Form 10-K filing.                                                                    |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| 21     |   | Subsidiaries of the  Registrant.                                                                                                                                                                                                                                                                                                                                                                                                                     |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| 22     |   | Published Report  Regarding Matters Submitted To Vote Of Shareholders is incorporated by  reference to the 2003 Definitive Proxy Statement of SUN BANCORP, INC.                                                                                                                                                                                                                                                                                      |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| 23     |   | Consent of Independent  Accountants.                                                                                                                                                                                                                                                                                                                                                                                                                 |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| 24     |   | Power of Attorney  (included on signature page)                                                                                                                                                                                                                                                                                                                                                                                                      |

 

 

(b)                                             On December 23, 2002 Form 8-K wasfiled regarding the acquisition of Mid-Penn Insurance Associates, Inc.

 

On December 23, 2002 Form8-K was filed regarding the acquisition of Steelton Bancorp, Inc.

 

(c)                                              Exhibits - the required exhibitsare included under Item 15(a)(3) of the Form 10-K.

 

(d)                                             Financial statement schedules areomitted because the required information is not applicable or is includedelsewhere herein.

 

3

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SIGNATURES

 

Pursuant to therequirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, SUNBANCORP, INC. has duly caused this report to be signed on its behalf by theundersigned, thereunto duly authorized.

 

 
|   | Sun Bancorp, Inc.                                                   |   |
|--------|---------------------------------------------------------------------|--------|
|   | (Registrant)                                                        |   |
|   |
| Date:  | 7/24/03                                                             |   | By: | /s/ Robert J. McCormack |
|   | Robert J. McCormack                                                 |
|   | President and Chief  Executive Officer(Principal Executive Officer) |
|   |
| Date:  | 7/24/03                                                             |   | By: | /s/ Wilmer D. Leinbach |
|   | Wilmer D. Leinbach                                                  |
|   | Exec. VP, Chief Financial Officer                                   |
|   | (Principal Financial Officer and  Principal Accounting Officer)     |
|        |                                                                     |        |  |  |  |

 

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POWER OF ATTORNEY

 

KNOW ALL MEN BY THESE PRESENTS, that each person whose signatureappears below constitutes and appoints Robert J. McCormack and Wilmer Leinbach,and each of them, his true and lawful attorneys-in-fact and agents, with fullpower of substitution and resubstitution, for him and in his name, place andstead, in any and all capacities, to sign any and all amendments to the AnnualReport on Form 10-K for the Company’s 2003 fiscal year, and to file the same,with all exhibits thereto, and other documents in connection therewith, withthe Commission, granting unto said attorneys-in-fact and agents, and each of them,full power and authority to do and perform each and every act and thingrequisite and necessary to be done, as fully to all intents and purposes as hemight or could do in person, hereby ratifying and confirming all that saidattorneys-in-fact and agents or either of them, or their or his substitutes,may lawfully do or cause to be done by virtue thereof.

 

Pursuant to the requirements of the Exchange Act of 1934, this reporthas been signed by the following persons in the capacities and on the dates indicated.

 
| **Name**                                          |   | **Date** |   |
|---------------------------------------------------|--------|----------|--------|
|                                              |   |     |
| /s/  Robert A. Hormell                            |   | 7/24/03  |   |
| Robert  A. Hormell                                |   |     |
| Chairman  of the Board                            |   |     |
|                                              |   |     |
| /s/  Robert J. McCormack                          |   | 7/24/03  |   |
| Robert  J. McCormack                              |   |     |
| President,  Chief Executive Officer, and Director |   |     |
|                                              |   |     |
|                                              |   |     |   |
| Martha  A. Barrick, Director                      |   |     |
|                                              |   |     |
|                                              |   |     |   |
| Max  E. Bingaman, Director                        |   |     |
|                                              |   |     |
| /s/  Maureen M. Bufalino                          |   | 7/24/03  |   |
| Maureen  M. Bufalino, Director                    |   |     |
|                                              |   |     |
| /s/  David R. Dieck                               |   | 7/24/03  |   |
| David  R. Dieck, Director                         |   |     |
|                                              |   |     |
| /s/  Louis A. Eaton                               |   | 7/24/03  |   |
| Louis  A. Eaton, Director                         |   |     |
|                                              |   |     |
| /s/  M. Mitchell Fetterolf                        |   | 7/24/03  |   |
| M.  Mitchell Fetterolf, Director                  |   |     |
|                                              |   |     |
| /s/  Dan Geise                                    |   | 7/24/03  |   |
| Dan  Geise, Director                              |   |     |
|                                              |   |     |
| /s/  Stephen J. Gurgovits                         |   | 7/24/03  |   |
| Stephen  J. Gurgovits, Director                   |   |     |
|                                              |   |     |
| /s/  George F. Keller                             |   | 7/24/03  |   |
| George  F. Keller, Director                       |   |     |
|                                                   |        |          |        |  |

 

5

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|                            |   |    |   |
|---------------------------------|--------|---------|--------|
| George  E. Logue, Jr., Director |   |    |
|                            |   |    |
| /s/  Marlin T. Sierer           |   | 7/24/03 |   |
| Marlin  T. Sierer, Director     |   |    |
|                            |   |    |
| /s/  Gary L. Tice               |   | 7/24/03 |   |
| Gary  L. Tice, Director         |   |    |
|                            |   |    |
| /s/  Dennis J. Van              |   | 7/24/03 |   |
| Dennis  J. Van, Director        |   |    |

 

6

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Subsidiaries of SunBancorp, Inc.

 

The following table setsforth the subsidiaries of the Registrant at December 31, 2002.

 
| **Name**                              |   | **Organized Under  the Laws of** |
|---------------------------------------|--------|----------------------------------|
|                                  |   |                             |
| SunBank                               |   | Commonwealth of Pennsylvania     |
| Lewisburg,  PA                        |   |                             |
| Wholly  Owned                         |   |                             |
|                                  |   |                             |
| Beacon Life Insurance  Company        |   | State of Arizona                 |
| Phoenix,  AZ                          |   |                             |
| Wholly  Owned                         |   |                             |
|                                  |   |                             |
| Sun Bancorp Statutory  Trust I        |   | State of Connecticut             |
| Hartford,  CT                         |   |                             |
| Wholly  Owned                         |   |                             |
|                                  |   |                             |
| SUBI Investment Company               |   | State of Delaware                |
| Wilmington,  DE                       |   |                             |
| Wholly  Owned                         |   |                             |
|                                  |   |                             |
| Sun Abstract and  Settlement Services |   | Commonwealth of  Pennsylvania    |
| Lewisburg,  PA                        |   |                             |
| Thirty  Percent Owned                 |   |                             |
|                                  |   |                             |
| Sun Investment Services,  Inc.        |   | Commonwealth of  Pennsylvania    |
| Lewisburg,  PA                        |   |                             |
| Wholly  Owned                         |   |                             |
|                                  |   |                             |
| SUBI Services, Inc.                   |   | Commonwealth of  Pennsylvania    |
| Lewisburg,  PA                        |   |                             |
| Wholly  Owned                         |   |                             |

 

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## CONSENT OFINDEPENDENT ACCOUNTANTS

 

We hereby consent to the incorporation by reference in the RegistrationStatements on Form S-8 (No. 333-61249, No. 333-61241, No. 333-40266 and No.333-61237) of Sun Bancorp, Inc. of our report dated February 11, 2003 relatingto the financial statements, which appears in the Annual Report toShareholders, which is incorporated in this Annual Report on Form 10-K.

 

 
| /s/ PricewaterhouseCoopers LLP |   |
|--------------------------------|--------|
|                           |
| Harrisburg, Pennsylvania       |
| July 23, 2003                  |

 

CONSENT OF INDEPENDENT ACCOUNTANTS

 

We hereby consent to the incorporation by reference in the RegistrationStatements on Forms S-8 (Nos. 333-61249, 333-61241, 333-40266 and 333-61237) ofSun Bancorp, Inc. of our report dated February 19, 2002, which appears in thisForm 10-K.

 

 
| /s/ Parente Randolph, PC   |   |
|----------------------------|--------|
|                       |
| Williamsport, Pennsylvania |
| July 23, 2003              |

 

8

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**CERTIFICATION**

 

I, Robert J. McCormack,President and Chief Executive Officer, certify, that:

 

1.                                       I have reviewedthis annual report on Form 10-K of Sun Bancorp, Inc.

 

2.                                       Based on myknowledge, the annual report does not contain any untrue statement of a materialfact or omit to state a material fact necessary to make the statements made, inlight of the circumstances under which such statements were made, notmisleading with respect to the period covered by this annual report.

 

3.                                       Based on myknowledge, the financial statements, and other financial information includedin this annual report, fairly present in all material respects the financialcondition, results of operations and cash flows of the registrant as of, andfor, the periods presented in this annual report.

 

4.                                       The registrant’sother certifying officer and I are responsible for establishing and maintainingdisclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and15d-14) for the registrant and we have:

 

(a)                                  designed such disclosurecontrols and procedures to ensure that material information relating to theregistrant, including its consolidated subsidiaries, is made known to us byothers within those entities, particularly during the period in which thisannual report is being prepared;

 

(b)                                 evaluated theeffectiveness of the registrant’s disclosure controls and procedures as of adate within 90 days prior to the filing date of this annual report (the“Evaluation Date”); and

 

(c)                                  presented in thisannual report our conclusions about the effectiveness of the disclosurecontrols and procedures based on our evaluation as of the Evaluation Date.

 

5.                                       The registrant’sother certifying officer and I have disclosed, based on our most recentevaluation, to the registrant’s auditors and the audit committee ofregistrant’s board of directors (or persons performing the equivalentfunction):

 

(a)                                  all significantdeficiencies in the design or operation of the internal controls which couldadversely affect the registrant’s ability to record, process, summarize andreport financial data and have identified for the registrant’s auditors anymaterial weaknesses in internal controls; and

 

(b)                                 any fraud, whether ornot material, that involves management or other employees who have asignificant role in the registrant’s internal controls.

 

6.                                       The registrant’sother certifying officer and I have indicated in this quarterly report whetheror not there were significant changes in internal controls or in other factorsthat could significantly affect the internal controls subsequent to the date ofour most recent evaluation, including any corrective actions with regard tosignificant deficiencies and material weaknesses.

 

| 7.     | Date:  | July 24, 2003 |                                    | By: | /s/ Robert J. McCormack |
|--------|--------|---------------|-----------------------------------------|-----|-------------------------|
|   |   |          | President & Chief Executive Officer |

 

9

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**CERTIFICATION**

 

I, Wilmer D. Leinbach,Executive Vice President and Chief Financial Officer, certify, that:

 

1.                                       Ihave reviewed this annual report on Form 10-K of Sun Bancorp, Inc.

 

2.                                       Based on myknowledge, the annual report does not contain any untrue statement of amaterial fact or omit to state a material fact necessary to make the statementsmade, in light of the circumstances under which such statements were made, notmisleading with respect to the period covered by this annual report.

 

3.                                       Based on myknowledge, the financial statements, and other financial information includedin this annual report, fairly present in all material respects the financialcondition, results of operations and cash flows of the registrant as of, andfor, the periods presented in this annual report.

 

4.                                       The registrant’sother certifying officer and I are responsible for establishing and maintainingdisclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and15d-14) for the registrant and we have:

 

(a)                                  designed suchdisclosure controls and procedures to ensure that material information relatingto the registrant, including its consolidated subsidiaries, is made known to usby others within those entities, particularly during the period in which thisannual report is being prepared;

 

(b)                                 evaluated theeffectiveness of the registrant’s disclosure controls and procedures as of adate within 90 days prior to the filing date of this annual report (the “EvaluationDate”); and

 

(c)                                  presentedin this annual report our conclusions about the effectiveness of the disclosurecontrols and procedures based on our evaluation as of the Evaluation Date.

 

5.                                       The registrant’sother certifying officer and I have disclosed, based on our most recentevaluation, to the registrant’s auditors and the audit committee ofregistrant’s board of directors (or persons performing the equivalentfunction):

 

(a)                                  all significantdeficiencies in the design or operation of the internal controls which couldadversely affect the registrant’s ability to record, process, summarize andreport financial data and have identified for the registrant’s auditors anymaterial weaknesses in internal controls; and

 

(b)                                 any fraud, whether ornot material, that involves management or other employees who have asignificant role in the registrant’s internal controls.

 

6.                                       The registrant’sother certifying officer and I have indicated in this quarterly report whetheror not there were significant changes in internal controls or in other factorsthat could significantly affect the internal controls subsequent to the date ofour most recent evaluation, including any corrective actions with regard tosignificant deficiencies and material weaknesses.

 

| 7.     | Date:  | July 24, 2003 |                                                   | By: | /s/ Wilmer D. Leinbach |
|--------|--------|---------------|--------------------------------------------------------|-----|------------------------|
|   |   |          | Executive Vice President and   Chief Financial Officer |

 

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