**UNITEDSTATES**

**SECURITIESAND EXCHANGE COMMISSION**

**Washington,D.C. 20549**

 

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**FORM10-KSB/A**

**(AmendmentNo. 1)**

 

**ANNUALREPORT UNDER SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934**

 

**Forthe Fiscal Year Ended December 31, 2002**

 

**CommissionFile Number 000-17510**

 

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**MEGAGROUP, INC.**

(Name of SmallBusiness Issuer in Its Charter)

 

| **New  York**                                                      |   | **14-1653446**                        |
|--------------------------------------------------------------------|--------|---------------------------------------|
| (State or Other  Jurisdiction  of Incorporation or Organization)   |   | (I.R.S. Employer  Identification No.) |
|                                                               |   |                                  |
| **1730  Rhode Island Ave., N.W., Suite 415  Washington, DC 20036** |   | **(202)  296-9594**                   |
| (Address of  Principal Executive Offices)                          |   | (Issuer’s  Telephone Number)     |

 

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Securitiesregistered under Section 12(b) of the Exchange Act:

 

**None**

 

Securitiesregistered under Section 12(g) of the Exchange Act:

 

**CommonStock, $.016 Par Value**

**(Titleof Class)**

 

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

 

Check if there is nodisclosure of delinquent filers in response to Item 405 of Regulation S-Bcontained in this form, and no disclosure will be contained, to the best of theregistrant’s knowledge, in definitive proxy or information statementsincorporated by reference in Part III of this Form 10-KSB or any amendment tothis Form 10-KSB.  o

 

State issuer’s revenuesfor its most recent fiscal year: $30,000.

 

State the aggregatemarket value of the voting and non-voting common equity held by non-affiliatescomputed by reference to the price at which the common equity was sold, or theaverage bid and asked price of such common equity, as of a specified datewithin the past 60 days: $510,274.55 as of February 20, 2003, based on the lastreported sale price on that date.

 

State the number ofshares outstanding of each of the issuer’s classes of common equity, as of thelatest practicable date: 9,359,303 shares of common stock (including 75,302shares held of record by our wholly-owned subsidiary), as of April 1, 2003.

 

 

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**PARTIII**

 

EXPLANATORY NOTE

 

         This Form 10-KSB/A (Amendment No. 1) is being filed to amend and restate the information disclosed in Items 11 and 13 of Part III of the Form 10-KSB filed on March 7, 2003 for the fiscal year ended December 31, 2002. Item 11 of the previous filing did not accurately indicate the number of shares outstanding of the issuer’s common equity as of December 31, 2002, and the security ownership of certain beneficial owners and management.

 

**Item11.    *SecurityOwnership of Certain Beneficial Owners and Management.***

 

The followingtable sets forth certain information, as of December 31, 2002, concerning theshares of our common stock owned by each more-than-five-percent beneficialowner of our common stock, each of our directors and named executive officers,and all of our directors and executive officers as a group:

 

 

**SECURITYOWNERSHIP TABLE**

 
| **Name and  Address  of Beneficial Owner**                                 |   | **Shares  Beneficially Owned** |   | **Percent of  Class** |   |
|----------------------------------------------------------------------------|--------|--------------------------------|--------|----------------------------|--------|
| John H. Brown  1730 Rhode Island Ave., N.W., #415  Washington, D.C. 20036  |   | 2,603,132                      |   | 28.0                       | %(1)   |
|                                                                       |   |                           |   |                       |   |
| Joyce L. Brown  1730 Rhode Island Ave., N.W., #415  Washington, D.C. 20036 |   | 3,103,132                      | (2)    | 33.4                       | %(1)   |
|                                                                       |   |                           |   |                       |   |
| Steven C. Gregory  313 Ushers Road  Ballston Lake, NY 12019                |   | 501,125                        | (3)    | 5.4                        | %(1)   |
|                                                                       |   |                           |   |                       |   |
| Vern S. Morris  46619 Carriage Court  Sterling, VA 20164                   |   | 505,498                        |   | 5.4                        | %(1)   |
|                                                                       |   |                           |   |                       |   |
| Merritt C. Brown  51 Howell Drive  West Orange, NJ 07052                   |   | 500,000                        |   | 5.4                        | %      |
|                                                                       |   |                           |   |                       |   |
| Directors and Executive Officers as a Group (5  Persons)                   |   | 7,212,887                      | (2,3)  | 77.6                       | %(1)   |

 

On December 31,2002, Robert L. Halton, our former officer and director, owned 10,000 shares ofour 8% cumulative nonconvertible preferred stock, representing all of theissued and outstanding shares of our preferred stock, our only otheroutstanding class of equity securities.

 

Except asotherwise indicated, all of the persons named above hold their shares directlyand of record. None of them holds any shares under a trust or other comparableagreement. We know of no arrangements which may result in a change in ourcontrol.

 

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(1)     Based on 9,359,303 shares of common stock issued and outstanding, less 75,302shares held of record or beneficially by SBICOA, our wholly-owned subsidiary,plus any additional shares deemed “beneficially owned” by the respectivebeneficial owners, computed as provided in Section 13(d)(4) of the SecuritiesExchange Act of 1934 and SEC Rule 13d-3. John H. and Joyce L. Brown exerciseshared voting and investment power with respect to the shares held by SBICOA. 

 

(2)     Includes 9,400 shares of common stock held of record by Small BusinessInvestment Club of America, an affiliated general partnership, as to whichJoyce L. Brown exercises voting and investment power. 

 

(3)     Includes 1,125 shares held of record by Margaret Laguardia Gregory, Mr.Gregory’s wife. Mr. Gregory disclaims beneficial ownership of the shares heldby his wife. 

 

 

2

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 **Item13.    *Exhibits andReports on Form 8-K.***

 

(b)     Reports on Form 8-K:

 

Form 8-K filed onApril 4, 2003, Item 5. Other Events.

 

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**SIGNATURES**

 

**Inaccordance with Section 13 or 15(d) of the Securities Exchange Act of 1934, asamended, the registrant caused this report to be signed on its behalf by theundersigned, thereunto duly authorized.**

 
|                 | MEGA GROUP, INC.                                                                        |
|----------------------|-----------------------------------------------------------------------------------------|
|                 |                                                                                    |
|                 | By:                                                                                     | /s/  JOHN  H. BROWN |
|                 | **John  H. Brown****Chairman of the Board of****Directors and Chief Executive Officer** |
|                 |                                                                                    |
| Date:  April 9, 2003 |                                                                                    |

 

**Inaccordance with the Securities Exchange Act of 1934, as amended, this reporthas been signed below by the following persons on behalf of the registrant andin the capacities and on the dates indicated.**

 
|                 |                                    |
|----------------------|-----------------------------------------|
|                 | By:                                     | /s/    JOHN  H. BROWN |
|                 | **John  H. Brown,**                     |
|                 | **Principal  Executive Officer and**    |
|                 | **Chairman  of the Board of Directors** |
|                 |                                    |
| Date: April 15, 2003 |                                    |
|                 |                                    |
|                 | By:                                     | /s/    MERRITT  C. BROWN |
|                 | **Merritt  C. Brown,**                  |
|                 | **Principal  Financial and**            |
|                 | **Accounting  Officer and Director**    |
|                 |                                    |
| Date: April 15, 2003 |                                    |
|                 |                                    |
|                 | By:                                     | /s/    STEVEN  C. GREGORY |
|                 | **Steven  C. Gregory,**                 |
|                 | **Director**                            |
|                 |                                    |
| Date: April 15, 2003 |                                    |
|                 |                                    |
|                 | By:                                     | /s/    JOYCE  L. BROWN |
|                 | **Joyce  L. Brown,**                    |
|                 | **Director**                            |
|                 |                                    |
| Date: April 15, 2003 |                                    |
|                 |                                    |
|                 | By:                                     | /s/    VERN  S. MORRIS |
|                 | **Vern  S. Morris,**                    |
|                 | **Director**                            |
|                 |                                    |
| Date: April 15, 2003 |                                    |
|                 |                                    |   |   |

 

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**CERTIFICATIONS**

 

CHIEF EXECUTIVEOFFICER CERTIFICATION

 

I, John H. Brown,certify that:

 

1.  Ihave reviewed this annual report on Form 10-KSB/A of Mega Group, Inc.;

 

2.  Basedon my knowledge, this 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.  Basedon my knowledge, the financial statements, and other financial informationincluded in this annual report, fairly present in all material respects thefinancial condition, results of operations and cash flows of the registrant asof, and for, the periods presented in this annual report;

 

4.  Theregistrant’s other certifying officers and I are responsible for establishingand maintaining disclosure controls and procedures (as defined in Exchange ActRules 13a-14 and 15d-14) for the registrant and have:

 

a)  designedsuch disclosure controls and procedures to ensure that material informationrelating to the registrant, including its consolidated subsidiaries, is madeknown to us by others within those entities, particularly during the period inwhich this annual report is being prepared;

 

b)  evaluatedthe effectiveness of the registrant’s disclosure controls and procedures as ofa date within 90 days prior to the filing date of this annual report (the“Evaluation Date”); 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.  Theregistrant’s other certifying officers and I have disclosed, based on our mostrecent evaluation, to the registrant’s auditors and the audit committee ofregistrant’s board of directors (or persons performing the equivalentfunctions):

 

a)  allsignificant deficiencies in the design or operation of internal controls whichcould adversely affect the registrant’s ability to record, process, summarizeand report financial data and have identified for the registrant’s auditors anymaterial weaknesses in internal controls; and

 

b)  anyfraud, whether or not material, that involves management or other employees whohave a significant role in the registrant’s internal controls; and

 

6.  Theregistrant’s other certifying officers and I have indicated in this annualreport whether there were significant changes in internal controls or in otherfactors that could significantly affect internal controls subsequent to thedate of our most recent evaluation, including any corrective actions withregard to significant deficiencies and material weaknesses.

 

 
|                 |                                                                                                               |
|----------------------|--------------------------------------------------------------------------------------------------------------------|
|                 | By:                                                                                                                | /s/  JOHN  H. BROWN |
|                 | **John  H. Brown****Chairman of the Board of Directors  and Chief Executive Officer  Principal Executive Officer** |
|                 |                                                                                                               |
| Date: April 15, 2003 |                                                                                                               |

 

5

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CHIEF FINANCIALOFFICER CERTIFICATION

 

I, Merritt C.Brown, certify that:

 

1.  Ihave reviewed this annual report on Form 10-KSB/A of Mega Group, Inc.;

 

2.  Basedon my knowledge, this 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.  Basedon my knowledge, the financial statements, and other financial informationincluded in this annual report, fairly present in all material respects thefinancial condition, results of operations and cash flows of the registrant asof, and for, the periods presented in this annual report;

 

4.  Theregistrant’s other certifying officers and I are responsible for establishingand maintaining disclosure controls and procedures (as defined in Exchange ActRules 13a-14 and 15d-14) for the registrant and have:

 

a)  designedsuch disclosure controls and procedures to ensure that material informationrelating to the registrant, including its consolidated subsidiaries, is madeknown to us by others within those entities, particularly during the period inwhich this annual report is being prepared;

 

b)  evaluatedthe effectiveness of the registrant’s disclosure controls and procedures as ofa date 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.  Theregistrant’s other certifying officers and I have disclosed, based on our mostrecent evaluation, to the registrant’s auditors and the audit committee ofregistrant’s board of directors (or persons performing the equivalentfunctions):

 

a)  allsignificant deficiencies in the design or operation of internal controls whichcould adversely affect the registrant’s ability to record, process, summarizeand

 

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report financialdata and have identified for the registrant’s auditors any material weaknessesin internal controls; and

 

b)  anyfraud, whether or not material, that involves management or other employees whohave a significant role in the registrant’s internal controls; and

 

6.  Theregistrant’s other certifying officers and I have indicated in this annualreport whether there were significant changes in internal controls or in otherfactors that could significantly affect internal controls subsequent to thedate of our most recent evaluation, including any corrective actions withregard to significant deficiencies and material weaknesses.

 
|                 |                                                                                           |
|----------------------|------------------------------------------------------------------------------------------------|
|                 | By:                                                                                            | /s/    MERRITT  C. BROWN |
|                 | **Merritt  C. Brown  Vice President and Chief Financial Officer  Principal Financial Officer** |
|                 |                                                                                           |
| Date: April 15, 2003 |                                                                                           |

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