---

# U.S.
SECURITIES AND EXCHANGE COMMISSION

# Washington, D.C. 20549

# FORM 10-KSB/A No. 1

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# [X]  ANNUAL
REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31,
2002

# [  ] TRANSITION REPORT UNDER
SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Commission File Number 0-16423

SAN Holdings, Inc.
(Name of Small Business Issuer in its Charter)

| | Colorado
(State of incorporation) | 84-0907969
(I.R.S. Employer File Number)
| | --------------------------------- | ----------------------------------------

900 West
Castleton Road, Suite 210, Castle Rock, CO 80104
      
              
             
(303) 660-3933
(Address including zip code, area code and telephone number of Registrant's
principal executive offices.)

Securities
registered pursuant to Section 12(b) of the Act:     
None

Securities registered pursuant to Section 12(g) of the Act:
              
              
Title of Each Class
              
              
        
              
Name of Each Exchange on Which Registered
              
     Common stock, no par value
              
              
              
              
OTC Bulletin Board

Check whether the issuer
(1) filed all reports required to be filed by Section 13 or 15(d) of the
Securities 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 disclosure of
delinquent filers in response to Item 405 of Regulation S-B is not contained in
this form, and no disclosure will be contained, to the best of 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.
[  ]

Issuers
revenues for its most recent fiscal year: $33,002,509.

As of
March 31, 2003, 38,269,102 shares of the Registrants common stock were
outstanding.

State
the aggregate market value of the voting and non-voting common equity held by
non-affiliates computed by reference to the price at which the common equity was
last sold, or the average bid and asked price of such common equity, as of the
last business day of the Registrants most recently completed second fiscal
quarter (June 28, 2002): $11,410,000.

Transitional Small
Business Disclosure Format (check one): Yes [  ] No
[X]

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# SAN
HOLDINGS, INC.
Form 10-KSB

|Item 9. | Directors,
Executive Officers, Promoters and Control Persons; Compliance With Section  16(a) of the
Exchange Act
|------- | ----------------------------------------------------------------------------------------------------------------

Our
Directors are elected for one-year terms at the annual meeting of our
shareholders. The board of directors elects executive officers annually.

Pursuant
to the agreements under which we acquired Solunet Storage, two of our directors
(Fred Busk and William Hipp) resigned, and three other individuals (Messrs.
Leder, Krouse and Terry) were elected as Directors. Pursuant to those
agreements, we agreed to nominate (but have not yet nominated) as a director,
for election at the next annual meeting and thereafter through December 31,
2004, the designee of one shareholder, Hollger LLC, and shareholder Sun Solunet
LLC agreed to vote for that designee. We currently anticipate that Gary Holloway
will be designated by Hollger LLC. Pursuant to those agreements, we also agreed
to nominate (but have not yet nominated) the following additional persons as
directors: Benjamin Emmons, C. Daryl Hollis, David Kreilein, M. Steven Liff,
Michael Phelan and George Rae. Each of Messrs. Emmons, Kreilein, Krouse, Leder,
Liff and Terry is an officer and employee of Sun Capital Partners, Inc., an
affiliate of Sun Solunet LLC, the principal shareholder of Solunet Storage prior
to our acquisition of that entity. Mr. Phelan was the president of Solunet
Storage prior to the acquisition. Except as described above, there are no other
arrangements or understandings between any officer or director and any other
person pursuant to which anyone was or is to be selected as an officer or
director.

Our
current directors and executive officers are as follows:

John
Jenkins, Age 53, Chairman and CEO since November 2000. From
January 1995 through June 2000, Mr. Jenkins was CEO, president and a director of
TAVA Technologies, Inc., where he led the build-out of a national systems
integration business. In 1999, all outstanding TAVA shares were sold in a cash
transaction approved by TAVA shareholders. From 1990 until he joined TAVA in
1995, he had served as president of Morgan Technical Ceramics, Inc., a
wholly-owned subsidiary of Morgan Crucible plc, a diversified industrial
products company based in England and publicly-traded on the London stock
exchange. From 1973 until 1990, Mr. Jenkins served in various capacities (most
recently as vice president and general manager) with the structural ceramic
division of Coors Ceramic Company, a subsidiary of Adolph Coors Company. Mr.
Jenkins holds a B.S. from the University of Washington and a J.D. from the
University of Denver.

Brendan
Reilly, Age 37, Chief Technology Officer and Director since
December 2001, pursuant to our acquisition agreement with ITIS Services, Inc. In
1998, Mr. Reilly a co-founded ITIS Services, a data storage solutions provider,
and served as its Executive Vice President and Chief Technology officer until
our acquisition of ITIS in 2001. Prior to founding ITIS, Mr. Reilly spent seven
years with EMC Corporation in various capacities, most recently as senior
territory manager. During the two years before joining EMC, he co-founded and
operated Veritas International Trading Company, an import-export company
conducting East Asian trade for companies such as LL Bean, Starter and Redman.
Mr. Reilly earned his undergraduate degree in Business Marketing from Providence
College.

Robert
K. Brooks, Age 59, Director since June 2000. Mr. Brooks has over
30 years of experience in the information technology industry, having held
positions in recruiting, sales and management. In June 1993, he became chairman
and managing partner of The Systems Group and Technical Directions, Inc., after
it merged with his contract programming, consulting and project management firm.
In January 1995, The Systems Group was acquired by ACS Technology Solutions, a
wholly owned subsidiary of Affiliated Computer Services, an international IT
services company (NYSE:ACS). From June 1995 through December 1999, Mr. Brooks
served as senior vice president of Affiliated Computer Services and as executive
vice president of ACS Technology Solutions, Inc. Currently, he is a director of
Cornus Corporation of Medford, Oregon, a privately held desktop software
products company. He received a Bachelor of Science Degree in Psychology from
the University of New Mexico.

Marc J.
Leder, Age 41, Director since April 2003, pursuant to our acquisition agreement
with Solunet Storage. Mr. Leder has served as a managing director of Sun Capital
Partners, Inc., a private investment firm, since May 1995. Prior to founding Sun
Capital Partners (with Mr. Krouse) in 1995, Mr. Leder served in various capacities with
Lehman Brothers, an investment bank based in New York City, most recently as Senior Vice
President. Mr. Leder also currently serves as a director of Catalina Lighting, Inc.,
Northland Cranberries, Inc., Celebrity, Inc., and Mackie Designs, Inc., all of which are
publicly held companies, and as a director of a number of private companies.

2

---

Rodger R.
Krouse, Age 41, Director since April 2003, pursuant to our acquisition agreement
with Solunet  Storage. Mr. Krouse has served as a managing director of Sun Capital
Partners, Inc., a private investment  firm, since May 1995.  Prior to founding Sun
Capital Partners (with Mr. Leder) in 1995, Mr. Krouse served in  various capacities with
Lehman Brothers, an investment bank based in New York City, most recently as Senior  Vice
President. Mr. Krouse also currently serves as a director of Catalina Lighting, Inc.,
Northland  Cranberries, Inc., Celebrity, Inc., and Mackie Designs, Inc., all of which are
publicly held companies, and as  a director of a number of private companies.

Clarence
Terry, Age 56, Director since April 2003, pursuant to our acquisition
agreement with Solunet Storage.  Mr. Terry has served as a managing director of Sun
Capital Partners, Inc., a private investment firm, since  September 1999. From October
1973 to September 1999, Mr. Terry was principally employed as vice president of  Rain
Bird Sprinkler Manufacturing Corporation, a leading irrigation manufacturer.  Currently,
he also serves  as a  director of Catalina Lighting, Inc., Northland Cranberries, Inc.,
Celebrity, Inc., and Mackie Designs,  Inc., all of which are publicly held companies, and
as a director of a number of private companies.

Michael
J. Phelan, Age 46, President and Chief Operating Officer,joined
SANZ in April 2003 pursuant to our acquisition agreement with Solunet Storage,
where he had served as President and Chief Executive Officer since the formation
of Solunet Storage in September 2002. Mr. Phelan has been involved in sales and
management in the computer and UNIX marketplace since 1980, and entered the data
storage business in 1990 when he founded StorNet, Inc. He served as President
and Chairman of the Board of StorNet until the merger of that company with
Vanguard Technologies in 2000. Following the merger with Vanguard, Mr. Phelan
became a consultant to resulting company but ceased participation in daily
operations for a period to pursue personal interests. In late 2001, at the
request of the then-current management of StorNet, Mr. Phelan re-joined the
company as its Acting Chief Executive Officer, a position he held until the sale
of StorNets assets to Sun Storage. Mr. Phelan serves on the advisory
boards of a variety of academic and philanthropic organizations. Mr. Phelan
holds a B.S. from West Chester University.

Hugh A. OReilly, Age
39, Chief Financial Officer, General Counsel and Senior Vice President, Finance and
Legal, joined SANZ in December 2001 pursuant to our acquisition agreement with ITIS
Services, where he had  served as Chief Financial Officer and General Counsel. Mr.
OReilly joined ITIS in October 2000. Prior to  joining ITIS, Mr. OReilly was a partner
at Nutter, McClennen & Fish LLP, a law firm based in Boston,  Massachusetts, where he
practiced corporate law for eleven years and served as the primary outside counsel for
ITIS. Mr. OReilly holds a J.D. from Vanderbilt University and an A.B in English from
Dartmouth College. Mr.  OReilly and Mr. Reilly are related by marriage.

Chris
M. Wilkes, Age38, Executive Vice President,joined SANZ in April
2003 pursuant to our acquisition agreement with Solunet Storage, where he served
as Executive Vice President since the formation of Solunet Storage in September
2002. From December 2001 until Solunet Storages acquisition of the assets
of StorNet, Inc. in September 2002, Mr. Wilkes served as Vice President of
Managed Services for StorNet, Inc. Prior to joining StorNet, Inc., Mr. Wilkes
was the Director of Sales of Managed Storage International, a storage services
provider, which he joined in 2000. From 1996 until he joined Managed Storage
International, Mr. Wilkes was General Manager  South/Central District for
Pioneer Standard Electronics, a computer equipment reseller and
distributor.  Mr. Wilkes holds an MBA from Texas A & M University, and
BBA in Marketing from Texas Tech University.

Board
Committees

The
Board of Directors has established a compensation committee and an audit
committee. Until the resignation of William Hipp in April 2003 pursuant to the
agreements under which we acquired Solunet Storage, each of these committees
consisted of Mr. Hipp and Mr. Brooks. A replacement for Mr. Hipp has yet to be
named. The prior audit committee members were independent, and when Mr.
Hipps post is filled the audit committee members will be independent, as
defined by the National Association of Securities Dealers listing
standards.

3

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Section
16(a) Beneficial Reporting Compliance

Based
on a review of filings with the SEC, as well as copies of the reports and
written representations we received from directors and officers required to file
and their written representations, we believe that during the year ended
December 31, 2002, no Directors or officers were late in filing any reports
under Section 16 of the Securities Exchange Act.

Item
10. Executive Compensation.

# Summary
Compensation Table

The
following table sets forth information regarding compensation paid during the
past three fiscal years to our Chief Executive Officer and to any of the four
most highly compensated executive officers who earned total salary and bonus in
excess of $100,000 per year during the year ended December 31, 2002.

|                        |  | Annual Compensation |  |           |     |        
|----------------------- |  | ------------------- |  | --------- | --- | -------
|
|                       
|John Jenkins,           |  | 2002                |  | $227,400  |     | $23,950
|President and CEO       |  | 2001                |  | $188,469  |     | -0-    
|                        |  | 2000                |  | $  58,230 | (2) | -0-    
|                       
|Hugh A. O'Reilly,       |  | 2002                |  | $192,500  |     | -0-    
|Senior Vice President   |  |                     | 
|CFO and General Counsel |  | l                   | 
|                       
|Fred T. Busk, III,      | 
|Executive Vice          |  | 2002                |  | $195,900  |     | -0-    
|President and COO       | 
|                       
|Holly J. Burlage, CFO   |  | 2002                |  | $117,387  |     | $20,000
|                        |  | 2001                |  | $143,175  |     | -0-    
|                       

|(1) |  | Mr.
Jenkins became Chief Executive Officer and President in November 2000.
|--- |  | --------------------------------------------------------------------------

|(2) |  | Represents
compensation paid pursuant to consulting agreements.
|--- |  | ---------------------------------------------------------------

|(3) |  | These
options are exercisable at $.29 per share.
|--- |  | ------------------------------------------------

|(4) |  | These
options are exercisable at $2.25 per share
|--- |  | ------------------------------------------------

|(5) |  | Consists
solely of company matching contributions to 401(k) defined contribution plan, available
to  all employees of the company following 90 days of full time employment.
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(6) |  | Mr.
Busk was our employee from January 1 through December 31, 2002, serving as Executive Vice
President and Chief Operating Officer until August, 2002.  Amounts shown represent
compensation for  services in all capacities.
|--- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(7) |  | Ms.
Burlage served as Chief Financial Officer until August, 2002.
|--- |  | -----------------------------------------------------------------

|(8) |  | These
warrants are exercisable at $.68 per share.
|--- |  | -------------------------------------------------

|(9) |  | Consists
of 100,000 warrants exercisable at $.81 per share, 100,000 warrants exercisable at $.89
per  share, 100,000 warrants exercisable at $1.00 per share, and 30,000 options,
exercisable at $2.25  per share, which expired prior to exercise.
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

4

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# Option and
Stock Appreciation Right Grants Table

The
following table sets forth information regarding the grant of options (including warrants
issued  as compensation) (and stock appreciation rights during the year ended December
31, 2002, to each of our  executive officers required to be named in the Summary
Compensation Table.

|Name              | Number of SecuritiesUnderlying Options/ SARsgranted (#) | Percent of total options/SARs granted to employeesin fiscal year (%) | Exercise orbase price($/Sh) | Expiration      date
|----------------- | ------------------------------------------------------- | -------------------------------------------------------------------- | --------------------------- | --------------------
|                 
|John Jenkins      |                                                         | 500,000                                                              |                             | 38                  
|                 
|Hugh A. OReilly  |                                                         | 200,000                                                              |                             | 15                  
|                 
|Fred T. Busk, III |                                                         | -0-                                                                  |                             | -0-                 
|                 
|Holly J. Burlage  |                                                         | 50,000                                                               |                             | 3                   
|                 

Aggregated
Option/SAR Exercises in Last Fiscal Year and Fiscal Year-End Option/SAR Values

The
following table shows the number of shares underlying unexercised options
(including warrants issued as compensation) held at December 31, 2002 by each of
the executive officers required to be named in the Summary Compensation Table,
and the aggregate dollar value of in-the-money, unexercised options held at the
end of the fiscal year. SANZ has not granted any stock appreciation rights.

|Name                  | Number of unexercised options at FY-end (#)                exercisable/unexercisable | Value of unexercised in-the-moneyoptions at FY-end ($)
|--------------------- | ------------------------------------------------------------------------------------ | ------------------------------------------------------
|                     
|John Jenkins, CEO     |                                                                                      | 300,000 / 500,000                                     
|Hugh A. OReilly, CFO |                                                                                      | 1,063,982 / 200,000                                   
|Fred T. Busk, III     |                                                                                      | 1,495,677 / 0                                         
|Holly J. Burlage      |                                                                                      | 350,000 / 0                                           
|                     

| | (1) | 300,000
of these options are exercisable at $2.25 per share, which is in excess of the market
price  of the shares at December 31, 2002.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------

| | (2) | 576,871
of these options are exercisable at $.625 per share, and 287,111 of these options are
exercisable at $.70 per share, both of which prices are in excess of the market price of
the  shares at December 31, 2002.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (3) | 1,345,677
of these options are exercisable at $.625 per share, which is in excess of the market
price  of the shares at December 31, 2002.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------

| | (4) | Includes
100,000  warrants are exercisable at $.81 per share, 100,000  warrants exercisable at
$.89  per share, 100,000  warrants exercisable at $1.00 per share, and 50,000 warrants
exercisable at  $.68 per share, all of which prices are in excess of the market price of
the shares at December  31, 2002.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# Compensation
of Directors

We
paid no cash compensation and granted no options to our directors for their services as
directors  during 2002.

# Employment
Contracts and Termination of Employmentand Change in Control Arrangements

We
have three year employment agreements with Messrs. Jenkins, Reilly and OReilly which
require us to  continue paying their salaries for a period of 12 months following
termination of employment in the following  cases:

| | ° | if
the employee terminates his employment within 90 days following specified change of
control events,
| | - | ------------------------------------------------------------------------------------------------------

| | ° | if
the employee terminates his employment due to our material change of his employment
conditions; or
| | - | -----------------------------------------------------------------------------------------------------

| | ° | if
we terminate his employment agreement other than for cause.
| | - | --------------------------------------------------------------

5

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Item 11.
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder
Matters

The table below
reflects the number of shares beneficially owned as of April 4, 2003 by:

| | ° | each
person or group we believe to be the beneficial owner of more than five percent of our
shares;
| | - | ---------------------------------------------------------------------------------------------------

| | ° | each
director;
| | - | --------------

| | ° | all
executive officers required to be named in the Summary Compensation Table; and
| | - | ----------------------------------------------------------------------------------

| | ° | all
directors and executive officers as a group.
| | - | ------------------------------------------------

Beneficial
ownership includes shares  represented by all options that are exercisable within 60 days
after  April 4, 2002.

|Name and Address of Beneficial Ownerof Common Stock | Amount and Natureof Beneficial Ownership(1) | Percent ofClass (1)
|--------------------------------------------------- | ------------------------------------------- | -------------------
|John Jenkins                                        |                                             | 1,040,000          
|900 West Castleton Road, Suite 100                  |                                            
|Castle Rock, CO 80104                               |                                            
|                                                    |                                             |                    
|Brendan T. Reilly                                   |                                             | 4,839,117          
|50 Day Street                                       |                                            
|Norwalk, CT 06854                                   |                                            
|Hugh A. O'Reilly                                    |                                             | 1,319,593          
|50 Day Street                                       |                                            
|Norwalk, CT 06854                                   |                                            
|Robert K. Brooks                                    |                                             | 150,000            
|900 West Castleton Road, Suite 100                  |                                            
|Castle Rock, CO 80104                               |                                            
|Marc J. Leder                                       |                                             | 57,403,653         
|c/o Sun Capital Partners II, LP                     |                                            
|5200 Town Center Circle, Suite 470                  |                                            
|Boca Raton, FL 33486                                |                                            
|Rodger D. Krouse                                    |                                             | 57,403,653         
|c/o Sun Capital Partners II, LP                     |                                            
|5200 Town Center Circle, Suite 470                  |                                            
|Boca Raton, FL 33486                                |                                            
|Clarence Terry                                      |                                             | -0-                
|c/o Sun Capital Partners II, LP                     |                                            
|5200 Town Center Circle, Suite 470                  |                                            
|Boca Raton, FL 33486                                |                                            
|Michael J. Phelan                                   |                                             | 1,435,091          
|1109 Saunders Court                                 |                                            
|West Chester, PA 19380                              |                                            
|All executive officers and                          |                                             | 64,752,363         
|directors as a group (8 persons)                    |                                            
|Sun Solunet LLC(5)(8)                               |                                             | 57,403,653         
|c/o Sun Capital Partners II, LP(5)                  |                                            
|c/o Sun Capital Advisors II, LP(5)                  |                                            
|c/o Sun Capital Partners, LLC(5)                    |                                            
|5200 Town Center Circle, Suite 470                  |                                            
|Boca Raton, FL 33486                                |                                            
|Hollger LLC (9)                                     |                                             | 2,797,209          
|c/o 5 Mile Ventures                                 |                                            
|95B Rowayton Avenue                                 |                                            
|Rowayton, CT 06855                                  |                                            
|Andrew K. Reilly                                    |                                             | 4,856,900          
|7 Extension Street                                  |                                            
|Newport, RI                                         |                                            

6

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_________________

* Less
than 1%.

|(1) |  | Includes shares of common stock issuable upon the conversion of the
Companys Series B Preferred Stock. The Series B Preferred Stock will
convert automatically into Common Stock at a conversion ratio of 50,000 : 1 when
our Articles of Incorporation are amended to increase the number of authorized
shares of Common Stock sufficient to enable such conversion. This ratio is fixed
(subject to adjustment only in the case of stock splits, stock dividends,
capital reclassifications and similar events) and is not dependent on the market
value of the Common Stock or any similar factor. The Series B Preferred Stock
contains no obligatory dividends and no preferences over the Common Stock with
respect to dividends, liquidation or other matters (other than the power to vote
with the Common Stock on an as-converted basis).
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) |  | Includes 500,000 shares underlying an option currently exercisable at $.29 per
share, 300,000 shares underlying an option currently exercisable at $2.25 per
share, 40,000 shares underlying a warrant currently exercisable at $.625 per
share, and 40,000 shares underlying a warrant currently exercisable at $1.25 per
share.
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) |  | Includes: 200,000 shares underlying an option currently exercisable at $.29 per
share, 200,000 shares underlying an option currently exercisable at $.33 per
share, 576,871 shares underlying an option currently exercisable at $.625 per
share, and 287,111 shares underlying an option currently exercisable at $.70 per
share.
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) |  | Includes 50,000 shares underlying an option currently exercisable at $.70 per
share, 15,000 shares underlying an option currently exercisable at $.81 per
share, 5,000 shares underlying an option currently exercisable at $10.82 per
share, 10,000 shares underlying a warrant currently exercisable at $.625 per
share and 10,000 shares underlying a warrant currently exercisable at $1.25 per
share.
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(5) |  | Consists solely of shares held by Sun Solunet LLC (further described in Note 8),
over which he may be deemed to have control.
|--- |  | -----------------------------------------------------------------------------------------------------------------------------

|(6) |  | Consists of (a) 500,000 shares of Common Stock, and (b) 18.702 shares of Series
B Preferred Stock, which are convertible into 935,091 shares of Common Stock.
All such shares are held by Mr. Phelan jointly with his wife.
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(7) |  | All of Mr. Phelans shares are subject to a Shareholder Agreement that,
among other things, (a) grants Sun Solunet LLC sole power to vote those shares,
(b) grants Sun Solunet a right of first refusal on those shares, (c) obligates
Mr. Phelan to sell his shares to a party that intends to purchase shares from
Sun Solunet LLC, if so demanded by Sun Solunet LLC, and (d) grants Mr. Phelan
the right to require a purchaser of shares from Sun Solunet LLC also to purchase
a pro rata number of Mr. Phelans shares on the same terms.
|--- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(8) |  | Consists of (a) 19,500,000 shares of Common Stock owned directly by Sun Solunet
LLC, (b) 500,000 shares of Common Stock owned by Mr. Phelan over which Sun
Solunet LLC has voting control, (c) 748.073 shares of Series B Preferred Stock
owned directly by Sun Solunet LLC, which are convertible into 36,468,562 shares
of Common Stock, and (d) 18.702 shares of Series B Preferred Stock owned by Mr.
Phelan over which Sun Solunet LLC has voting control, which are convertible into
935,091 shares of Common Stock. Messrs. Leder, Krouse and Terry may each be
deemed to have voting and dispositive power over the shares held by Sun Solunet
LLC.
|--- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(9) |  | Messrs. Gary Holloway and Konrad Kruger may each be deemed to have voting and
dispositive power over the shares held by Hollger, LLC.
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------

7

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# Equity
Compensation Plan Information

The following
table sets forth information regarding compensation plans (including individual
compensation  arrangements) in effect at December 31, 2002, under which equity securities
are authorized for issuance,  aggregated as follows: (i) all compensation plans
previously approved by shareholders; and (ii) all  compensation plans not previously
approved by shareholders.

|Plan Category                | Number of securities to beissued upon exercise ofoutstanding options,warrants and rights | Weighted-average exerciseprice of outstandingoptions, warrants andrights | Number of securitiesremaining available forfuture issuance underequity compensation plans(excluding securitiesreflected in column (a))
|---------------------------- | ---------------------------------------------------------------------------------------- | ------------------------------------------------------------------------ | --------------------------------------------------------------------------------------------------------------------------------------
|                            
|                             |                                                                                          | (a)                                                                      |                                                                                                                                       
|                            
|Equity compensation plans    |                                                                                          | 1,457,657(1)                                                             |                                                                                                                                       
|approved by security holders |                                                                                         
|                            
|Equity compensation plans    |                                                                                         
|not approved by security     |                                                                                          | 4,804,831                                                                |                                                                                                                                       
|holders                      |                                                                                         
|                            
|Total                        |                                                                                          | 6,262,488                                                                |                                                                                                                                       
|                            

(1)
Excludes 400,000 options with an exercise price of $1.50 per share that failed
to vest at an accelerated date of December 31, 2002 when specified performance
targets were not met at that date. If the holder is still employed by us on June
30, 2012, the options will vest at that date.

Description
of Non-Shareholder Approved Plan.

On
September 20, 2001, our Board of Directors adopted the 2001 Stock Option
Plan At December 31, 2002, the total number of shares of common stock reserved
for options issuable under this plan was 5,000,000.  Options granted under
the plan vest generally over three to ten years. The exercise price of
options granted under this plan shall be not less than 80% of the fair
market value per share on the date of option grant  With the exception of
roll-over options that were included in the plan upon our
acquisition of ITIS Services (i.e., options previously issued by ITIS Services
that we assumed in that acquisition), all options granted to date under the plan
have had an exercise price equal to, or in excess of, fair market value.

Item
12. Certain Relationships and Related Transactions.

Pursuant
to our acquisition agreement with Solunet Storage, Sun Solunet LLC became our
majority shareholder, holding 58.5% of our common stock (including shares of
Series B Preferred Stock that is convertible into common stock). Sun Capital
Partners II, LP (Sun Capital II) and Sun Capital Partners Management
LLC (Sun Capital Management) are both affiliates of Sun Solunet LLC.

Pursuant
to that acquisition agreement, we entered into a Credit Support Agreement with
Sun Capital II under which Sun Capital II has agreed to guarantee a minimum of
$3 million of our the debt of the combined company. This guaranty is currently
in place in support of a loan facility maintained by Solunet Storage. The
guaranty has been used to obtain greater liquidity (in the form of a higher
advance rate) under that loan facility than would have been available in the
absence of a guaranty. We have not paid Sun Capital II or its affiliates any
separate consideration for this guaranty.

In
addition, under the Credit Support Agreement we may request at any time that Sun
Capital II guaranty up to an additional $2 million of our debt. However, Sun
Capital II has the discretion whether or not to issue such a guaranty if so
requested. If it does issue such a guaranty and we do not discharge the debt or
otherwise obtain a release of the guaranty within eighteen months after its
issuance, we will issue warrants to Sun Capital II in payment for that guaranty,
and we will be obligated to issue additional warrants to Sun Capital II as
further payment at the end of each six-month period that the guaranty is not
released.

8

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Also
pursuant to our acquisition agreement with Solunet Storage, we entered into a
Management Services Agreement with Sun Capital Management. This Management
Services Agreement replaced and superseded a similar agreement between Sun
Capital Management and Solunet Storage that was in effect prior to our
acquisition of Solunet Storage. Pursuant to this agreement, we will receive
financial and management consulting services from Sun Capital Management in
exchange for a quarterly a fee of $75,000 per calendar quarter (plus
reimbursement of out-of-pocket expenses. The fee is fixed at this rate through
the quarter ending March 31, 2005, at which time it will be reset, based
primarily on the fees Sun Capital Management is then charging the other Sun
Capital portfolio companies. This agreement will remain in effect until our next
annual meeting of shareholders and thereafter until the first date when all of
the following have occurred: (a) the designees of Sun Capital Management and its
affiliates no longer constitute a majority of our Board of Directors; (b) Sun
Capital Management and its affiliates no longer own or control at least 30% of
our outstanding shares; and (c) Sun Capital Management and its affiliates
(including Sun Capital II) no longer guarantee any portion of our debt. If the
foregoing three events have not yet occurred, the Management Services Agreement
will nonetheless terminate on April 4, 2013.

9

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# SIGNATURES

In accordance with Section
13 or 15(d) of the Securities Exchange Act of 1934, the registrant has caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

| | SAN Holdings, Inc.
             
   (Registrant)
| | ------------------------------------------------

|Date: April 30, 2003 | By: /s/ Hugh A. OReilly
        Hugh A. OReilly
        
Senior Vice President and Chief Financial Officer
|-------------------- | ------------------------------------------------------------------------------------------------------------

10

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# CERTIFICATION
OF PRINCIPAL EXECUTIVE OFFICER

I, John
Jenkins, Chief Executive Officer of SAN Holdings, Inc., certify that:

1.
I have reviewed this annual report on Form 10-KSB/A No. 1 of SAN Holdings, 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 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 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 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
annual 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: April 30, 2003 | /s/ John Jenkins
     John Jenkins, President and
     Chief Executive Officer
|-------------------- | ------------------------------------------------------------------------------

11

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# CERTIFICATION
OF PRINCIPAL FINANCIAL OFFICER

I, Hugh A.
OReilly, Chief Financial Officer of SAN Holdings, Inc., certify that:

1.
I have reviewed this annual report on Form 10-KSB/A No. 1 of SAN Holdings, 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 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 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 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
annual 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: April 30, 2003 | /s/ Hugh A. OReilly
     Hugh A. OReilly
     Senior Vice President and
     Chief Financial Officer
|-------------------- | ------------------------------------------------------------------------------------------------------

12

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