**EXHIBIT99.1**

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**SAFEHARBOR COMPLIANCE STATEMENT FOR FORWARD-LOOKING STATEMENTS**

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In passing the Private Securities Litigation ReformAct of 1995, or the Reform Act, Congress encouraged public companies to make“forward-looking statements” by creating a safe harbor to protect them fromsecurities law liability in connection with these statements.  We intend to qualify both our written andoral forward-looking statements for protection under the Reform Act and anyother similar safe harbor provisions.

 

Generally, forward-looking statements includeexpressed expectations of future events and the assumptions on which theseexpectations are based.  Allforward-looking statements are inherently uncertain as they are based on expectationsand assumptions concerning future events, and they are subject to numerousknown and unknown risks and uncertainties that could cause actual events orresults to differ materially from those projected.  Due to those uncertainties and risks, the investment community isurged not to place undue reliance on our written or oral forward-lookingstatements.  We do not undertake anyobligation to update or revise this Safe Harbor Compliance Statement forForward-Looking Statements to reflect future developments.  In addition, we do not undertake anyobligation to update or revise forward-looking statements to reflect changedassumptions, the occurrence of unanticipated events or changes to futureoperating results over time.  ThisStatement supersedes the Safe Harbor Statement filed as Exhibit 99.1 toour Quarterly Report on Form 10-Q for the quarter ended March 31, 2002.

 

We provide the following risk factor disclosure inconnection with our continuing effort to qualify our written and oralforward-looking statements for the safe harbor protection of the Reform Act andany other similar safe harbor provisions. Important factors currently known to our management that could causeactual results to differ materially from those in forward-looking statementsinclude the disclosures contained in the Quarterly Report on Form 10-Q to whichthis statement is appended as an exhibit and also include the following:

 

**We need to raise additional capital.**

 

We often are in discussions with financialinstitutions or other companies regarding new credit facilities, exploringother capital-raising alternatives or possible combinations.  Members of our management team are likely toexpend considerable resources in pursuing and negotiating any such transaction.  We can offer no assurance that we will besuccessful in completing a capital-raising transaction or combination, and theterms and conditions of the transaction may pose additional risks to ourCompany.  Failure to immediately secureadditional capital or a combination will significantly impact the Company’sability to continue as a going-concern.

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**We have experienced, and continue toexperience, net losses and negative cash flows from operations.**

 

Since our inception, we have experienced, and arecontinuing to experience, operating losses and negative cash flows fromcontinuing operations.  Our statementsof operations for the six months ended June 30, 2002, and the same period inthe prior year, reflect net losses from continuing operations of $6,633,787,and $8,107,892, respectively.  Theauditors for the Company have included a going concern qualification in theiraudit opinion for the Company for the year ended December 31, 2001.

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**We require additional working capitalor financing to meet our operating demands.**

 

Our future financial results will depend primarily onour ability to increase advertising revenues and maintain our existinginstallations.  We cannot assure that wewill achieve profitability or positive cash flows from future operatingactivities.  If we experience operatingdifficulties, or if advertising revenues do not increase substantially, it islikely that we will be required to raise additional capital or obtainadditional financing to fund our operations. Based upon the Company’s current projections, the Company will need toraise additional capital immediately for 2002. As part of its ongoing effort to secure capital, the Company announcedthat it is in preliminary discussions with various parties, including severalsignificant 

 

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companies in the mediaindustry, regarding a possible combination, capital raising or other strategictransaction.  There has been nounderstanding or agreement reached with any party regarding anytransaction.  Further, there is noassurance that any transaction will occur or, if a transaction does occur, thatthe terms will be favorable.  Failure toimmediately secure additional capital will significantly impact the Company’sability to continue as a going-concern.

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**We may not meet our covenants underour bank debt arrangements.**

 

At June 30, 2002, we were not in compliance with afinancial covenant required under our $5 million line of credit facility. TheCompany received a waiver from the financial institution for the currentdefault related to the financial covenant of the $5 million line of creditfacility.  The outstanding amount on ourcredit facility is $5 million, which is due on January 31, 2003.  We believe it is possible that certainrequirements contained in our loan covenants may still not be met during fiscal2002.  If we fail to meet a covenant underthe bank loan, the financial institution has the right to declare the loan dueimmediately.

 

**Possibility of NASDAQ delisting.**

 

On February 14, 2002, CTN Media Group, Inc. (the“Company”) received a letter from The Nasdaq SmallCap Market indicating thatfor the last 30 consecutive trading days, the price of the Company’s commonstock closed below the minimum $1.00 bid per share requirement for continuedinclusion under Marketplace Rule 4310(c)(4). In accordance with Marketplace Rule 4310(c)(8)(D), the Company had 180calendar days, or until August 13, 2002, to regain compliance.  Due to the Company’s one-for-six reversestock split effectuated May 28, 2002, the Company’s common stock bid price pershare was over $1.00 for ten consecutive trading days as required byMarketplace Rule 4310(c)(8)(D) and the Company has been notified by Nasdaq thatit is now in compliance with Marketplace Rule 4310(c)(4).  However, there are no assurances that theCompany will continue to be in compliance with this rule or other Nasdaqcontinued inclusion Marketplace Rules. Failure to maintain Nasdaq listing could negatively impact the value ofCTN stock.

 

On May 21, 2002, the Company received a letter fromNasdaq SmallCap Market indicating that it did not meet the net tangible assettest and other financial tests set forth in Marketplace Rule4310(c)(2)(B).  The Company responded toNasdaq explaining the failure and why the Company felt that it did meet theintent of the net tangible asset test. Nasdaq may not accept the Company’s position.

 

**Wedepend on our advertising revenues.**

 

We derive a significant portion of our revenues fromadvertisers displaying their commercials on the College TelevisionNetwork.  Although we have agreementswith certain national advertisers and have held discussions or had prioragreements with other national advertisers, we cannot assure that theseadvertisers will continue to purchase advertising from us, or that newadvertisers will purchase advertising from us. Because certain advertisers may discontinue or reduce advertising on ournetwork from time to time, we anticipate that we could experience fluctuationsin operating results and revenues. The failure to attract and enter into newand/or additional agreements with national advertisers and to derivesignificant revenues from these advertisers would have a material adverseeffect on our business and financial results.

 

**We must maintain existinginstallations.**

 

Our network’s growth is dependent upon our ability tomaintain the number of installation sites at colleges and universities.  If we maintain our installation sites andincrease sell-out percentages and CPM rates, we will be able to increase ouradvertising revenue.  We have decreasedour number of installed locations, including contracts for futureinstallations, from 1,870 as of June 30, 2001 to 1,706 as of June 30, 2002.This pattern of diminishing locations may continue at the same pace or may evenaccelerate, and colleges and universities may require the removal of furthersystems from current locations. Our contracts with colleges and universitiesfor installation sites typically have a three-year term.  The failure to maintain our installationsites would have a material adverse effect on our business and financialresults.

 

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**We depend upon our access toprogramming.**

 

We believe that our ability to maintain access tomusic videos and other programming on a regular, long-term basis, on termsfavorable to us is important to our future success and profitability.  Our network’s programming consists primarilyof music, news, information and entertainment. Our network’s music programming is provided free of charge by majormusic companies including Warner/Elektra/Atlantic, EMI, Polygram, MCA andBMG.  There is no assurance that themusic companies will continue to provide the music videos free of charge.  We also receive customized news and sportsfeeds produced for the network by CNN through an agreement with Turner PrivateNetworks.  The Company is exploringrenewing this agreement or finding alternative sources of news and sports atlittle or no cost; however, if such agreement is not renewed or CTN cannotobtain a substitute, this would have a material adverse effect on the business andfinancial results.

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**We depend upon satellite technology.**

 

The ability of our network to transmit ourprogramming, and thereby derive advertising revenue, is dependent upon properperformance of the satellite transmission equipment upon which our network’sprogramming delivery is based.  Ourcontract with Public Broadcasting Service, Inc. provides for our sublease oftransponder capacity on a satellite owned and operated by GE AmericanCommunications, Inc.  We are entitled tolimited protected service under the sublease in the event the satellite fails,which would enable the network’s programming to be redirected to a differentsatellite under certain circumstances and subject to certain limitations.However, in the event that our network’s programming is required to beredirected to a different satellite, our satellite dishes installed in each ofour affiliate locations would be required to be redirected in order for theprogramming signals to be received from the satellite.  This redirection procedure could take up to21 days for completion and would involve significant cost to us.  We have obtained insurance for certain ofthe costs associated with such a satellite failure, including the costs ofredirecting the satellite dishes, securing a new satellite transponder, and thelost advertising revenues resulting from the interruption in programming.

 

**We depend on our agreements withthird parties.**

 

The ability of our network to transmit our programmingand to maintain and install our equipment is dependent upon performance bycertain third parties under contracts with us. We are substantially dependent upon performance by unaffiliatedcompanies for our day-to-day programming operations and system installation andmaintenance.

 

**Any failure to maintain or improvemarket acceptance for the network would adversely affect our business.**

 

Our prospects will be significantly affected by thesuccess of our affiliate marketing efforts, the acceptance of our programmingby potential viewers and our ability to attract advertisers. Achieving marketacceptance for our network will require significant effort and expenditures byus to enhance awareness and demand by viewers and advertisers. Our currentstrategy and future marketing plans may be subject to change as a result of anumber of factors, including progress or delays in our affiliate marketingefforts, the nature of possible affiliation and other broadcast arrangementsthat may become available to us in the future, and factors affecting the directbroadcast industry. We cannot assure that our strategy will result in initialor continued market acceptance for the network.

 

**We depend upon our key executives.**

 

We are substantially dependent on the efforts of TomRocco, our President.  The Company isimplementing management restructuring placing further reliance on other keyexecutives that may cause a disruption in the business of the Company.  In addition, the loss of any of theseexecutives could have a material adverse effect on our business and financialresults.

 

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**We depend on our sales staff tomaintain our business.**

 

Our business is, and will continue to be, dependentupon the sales skills of our account personnel and their relationships withclients.  There is substantialcompetition among media placement and advertising companies for talentedpersonnel and we are vulnerable to adverse consequences from the loss of keyindividuals.  Our employees aregenerally not under employment contracts and are free to move to competitors.

 

**We maynot be able to compete successfully with other companies.**

 

CTN competes for advertisers with many other forms ofadvertising media, including television, Internet, radio, print, direct mailand billboard. There are no meaningful intellectual property barriers toprevent competitors from entering into this market, and we cannot assure that acompetitor with greater resources than us will not enter into the market.  We believe that competition could increaseas other organizations perceive the potential for commercial application of ourproduct or service.

 

**We must continue to advance ourtechnology.**

 

We expect technological developments and enhancementsto continue at a rapid pace in the direct broadcast satellite network industryand related industries, and we cannot assure that technological developmentswill not require us to switch to a different transmission technology or causeour technology and products to be dated. Our future success could be largely dependent upon our ability to adaptto technological change and remain competitive.

 

**Our principal stockholder continuesto control our affairs.**

 

U-C Holdings, L.L.C. (“Holdings”) beneficially ownsapproximately 85% of our outstanding voting stock, including common stock andvoting preferred stock.  As a result ofits ownership, Holdings has, and will continue to have, sufficient voting powerto determine our direction and policies, the election of our directors, theoutcome of any other matter submitted to a vote of stockholders and to preventor cause a change in our control.

 

**We may be subject to conflicts ofinterest and related party transactions.**

 

Certain conflicts of interest may arise as a result ofthe beneficial ownership interests in Holdings that are held by a majority ofour directors and certain senior management. Several members of our Board of Directors may be deemed to be indirectbeneficial owners of the securities owned by Holdings.  Conflicts of interest may arise as a resultof these affiliated relationships. Although no specific measures to resolve such conflicts of interest havebeen formulated, our management and Board have a fiduciary obligation to dealfairly and in good faith with the stockholders and will exercise reasonablejudgment in resolving any specific conflict of interest that may occur.  In addition, the Company has a SpecialFinance Committee to the Board, made up of directors with no affiliation toHoldings, who deal with financing matters involving Holdings.

 

**The holders of our common stock couldbe materially diluted under certain circumstances.**

 

The conversion of the shares of convertible preferredstock into common stock or the payment of a dividend of shares of common stockto the holders of convertible preferred stock will result in dilution of votingrights of the currently outstanding public holders of the common stock.

 

**Our revenues are subject toseasonality.**

 

Our revenues are affected by the pattern ofseasonality common to most school-related businesses.  Historically, we have generated a significant portion of ourrevenues during the period of September through May and substantially fewerrevenues during the summer months when most colleges and universities do nothold regular classes.

 

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**Our stock price and ability to raisecapital or obtain financing could be hurt by our outstanding warrants andoptions.**

 

As of June 30, 2002, there are outstanding options topurchase approximately 445,267 shares of our common stock granted to employees,officers and directors pursuant to our stock option plans and otherwise.  In addition, there are warrants outstandingthat permit their holders to purchase approximately 154,139 shares of ourcommon stock.  Holdings has entered intocertain Equity Protection Agreements, dated April 25, 1997, which allowHoldings to purchase additional shares of our common stock at any time afterthe exercise of options or warrants that were outstanding on April 25, 1997 atthe price of $16.50 per share and $21.00 per share (as adjusted).  As of the date hereof, the Equity PurchaseAgreements represent Holdings’ right to purchase approximately 346,200 sharesof CTN’s common stock.  Certain otherholders of options and warrants also have demand and piggyback registrationrights.  While such rights, warrants andoptions are outstanding, they may (i) adversely affect the market price of ourcommon stock and (ii) impair our ability to, and the terms on which we can,raise additional equity capital or obtain debt financing.

 

**Sales of our shares could cause ourstock price to fall.**

 

Sales of a substantial number of shares of commonstock in the public market could adversely affect the market price of ourcommon stock prevailing from time to time. All shares of our common stock, including shares held by Holdings, arefreely tradable or may be sold pursuant to Rule 144 under the SecuritiesAct.  The sale of the shares of ourcommon stock held by Holdings and other affiliates of CTN are subject to certainvolume limitations set forth in Rule 144 under the Securities Act.  As of June 30, 2002, options to purchase445,267 shares and warrants to purchase 154,139 shares of our common stock wereoutstanding, of which options to purchase 217,510 shares and warrants topurchase 154,139 shares were exercisable.

 

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