`SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-KSB/A
                                  Amendment No. 2

(X) Annual Report pursuant to Section 13 or 15(d) of the Securities and Exchange
Act of 1934 for the fiscal year ended December 31, 2002.

( ) 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

                                   000-25783
                             Commission File Number

                           Americana Publishing, Inc.
             (Exact name of registrant as specified in its charter)

                               Colorado               84-1453702
              (State or other jurisdiction of   (IRS Employer ID No.)
              incorporation or organization)

                          303 San Mateo NE, Suite 104A
                          Albuquerque, New Mexico 87108
                    (Address of principal executive offices)

                                 (505) 265-6121
              (Registrant's telephone number, including area code)

           Securities registered pursuant to section 12(b) of the Act:
                          Common Stock $0.001 per share

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

Check whether the issuer:  (1) filed all reports required to be filed by section
13 or 15(d) of the  Exchange  Act  during  the past 12 months  (or such  shorter
period that the registrant  was required to be file such  reports),  and (2) has
been subject to such filing requirements for the past 90 days. Yes [X] No [ ]

Check if there is no disclosure of delinquent  filers in response to Item 405 of
Regulation  S-B 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 [ ]

State issuer's revenues for its most recent fiscal year: $640,848

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,  or the  average  bid and  asked  prices  of such  common  equity,  as of a
specified  date within the past 60 days.  (See  definition  of affiliate in Rule
12b-2 of the Exchange  Act).  As of  September  30, 2003 the market value of the
voting stock held by non-affiliates was $3,046,831.

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date. 98,885,285 shares as of September 30,
2003.

DOCUMENTS  INCORPORATED BY REFERENCE If the following documents are incorporated
by  reference,  briefly  describe  them and identify the part of the Form 10-KSB
into which the  document  is  incorporated:  (1) any annual  report to  security
holders;  (2) any proxy or information  statement;  and (3) any prospectus filed
pursuant to Rule 424(b) or (c) of the  Securities  Act of 1933 (the  "Securities
Act").  The listed  documents  should be clearly  described  for  identification
purposes. None.

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






                     AMERICANA PUBLISHING, INC. FORM 10-KSB

                                      INDEX

PART I                                                                          PAGE

Item 1.  DESCRIPTION OF BUSINESS                                                1-3
Item 2.  DESCRIPTION OF PROPERTY                                                  4
Item 3.  LEGAL PROCEEDINGS                                                      4-5
Item 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS                      5

PART II

Item 5.  MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED
           STOCKHOLDER MATTERS                                                  5-8
Item 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS             8-16
Item 7.  CONSOLIDATED FINANCIAL STATEMENTS                                     F1-F22
Item 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
           ACCOUNTING AND FINANCIAL DISCLOSURE;                                    17
Item 8A. CONTROLS AND PROCEDURES                                                17-18

PART III

Item 9.  DIRECTORS AND EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
           REGISTRANT COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT         18-19
Item 10. EXECUTIVE COMPENSATION                                                 19-20
Item 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT            21
Item 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS                            21
Item 13. EXHIBITS AND REPORTS ON FORM 8-K                                          22
           Reports on Form 8-K
Item 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES                                    23

SIGNATURES                                                                         23







                                     PART I


This Annual Report on Form 10-KSB contains "forward-looking statements". These
forward-looking statements are based on our current expectations, assumptions,
estimates and projections about our business and our industry. Words such as
"believe," "anticipate," "expect," "intend," "plan," "will," "may," and other
similar expressions identify forward-looking statements. In addition, any
statements that refer to expectations, projections or other characterizations of
future events or circumstances are forward-looking statements. These
forward-looking statements are subject to certain risks and uncertainties that
could cause actual results to differ materially from those reflected in the
forward-looking statements. Factors that might cause such a difference include,
but are not limited to, the following:

*    whether or not we can raise the capital necessary to implement our business
     plan and fund future operations,

*    whether or not we are able to expand the market for our products,

*    whether  or not the  acquisitions  we have made or that we will make in the
     future will be profitable,

*    increased competition in our niche market, truck stops, that would cause us
     to reduce the sales price of our products or that would otherwise adversely
     impact our sales,

*    changing  economic  conditions  that may impact  discretionary  spending by
     consumers,

and other factors, some of which will be outside our control. You are cautioned
not to place undue reliance on these forward-looking statements, which relate
only to events as of the date on which the statements are made. We undertake no
obligation to publicly revise these forward-looking statements to reflect events
or circumstances that arise after the date hereof. You should refer to and
carefully review the information in future documents we file with the Securities
and Exchange Commission.

                        Item 1.  DESCRIPTION OF BUSINESS

THE COMPANY

Our Business.

From October 1996 until April 1997, our predecessor operated as a development
stage division of B.H. Capital Limited, engaging in publication design research,
industry and competition research and demographic research. B.H. Capital Limited
is an entity whose principal and sole owner is George Lovato, Jr., our chairman,
Chief Executive Officer and President. We were incorporated under the laws of
the State of Colorado on April 17, 1997.

We are a multi-media publishing company. We believe that consumers today desire
audio books, e-books, CD-ROMs or a downloadable digital file in addition to
traditional print books. We believe that of the approximately 17,000 publishers
in the United States, many are unable to, or choose not to, publish manuscripts
in alternative formats. We publish and sell audio books, print books and
electronic books in a variety of genres, including mystery, western, business
development, personal development, spiritual and children's publications.

We determine what books to publish based on information that we receive from
book buyers and from general industry data relating to particular market
segments, such as purchases made at truck stops. We also receive manuscripts
from authors as well as from other publishers.

We license the manuscripts we publish either directly, from the author, or by
entering into agreements with other book publishers. Pursuant to our license
agreements, we generally pay a royalty of 10% on the proceeds of the books we
sell. License agreements may also require us to advance royalties in an amount
that usually ranges between $250 and $500 per title. The license agreements
typically have a term of five years.


                                       1




Approximately  87% of our sales come from the placement of our products in truck
stops. Our products are also sold to bookstores and libraries, primarily through
telemarketing, and to businesses and consumers via the Internet, through our
website, americanabooks.com. Prior to our entry into the truck stop market,
approximately 95% of our sales were generated by telemarketing and approximately
5% of our sales were generated via our website. Since our entry into the truck
stop market, approximately 10% of our sales are generated by telemarketing and
the remaining 3% of our sales are generated via our website. We also publish a
catalog of our audio books, which is continuously mailed to potential wholesale
book buyers, bookstores and libraries. Sales that result from our catalogue
mailings are not tracked separately but are included in our computation of sales
made by telemarketing.

Discontinued Operations

Until December 31, 2002 we also sold textbooks, music, artwork and jewelry
through other websites that were linked with each other and with our main
website, americanabooks.com. We decided to discontinue sales of these items
because the cost of maintaining the websites exceeded the revenues we earned
from them. Sales of these items accounted for only about 1% of our total sales,
therefore our decision to discontinue them has not had a material adverse effect
on our revenues.

In July 2001 we acquired Corporate Media Group, Inc. Corporate Media Group, Inc.
was in the business of packaging, duplicating, replicating and fulfilling orders
for audio cassettes, VHS tapes, CDs and DVDs for sale to distributors,
wholesalers, retailers and the general public. Through its division, Visual
Energy Studios, it also provided studio space for pre and post production audio
and video recording. We intended to continue these operations as well as to use
Corporate Media Group, Inc. to fulfill orders for our products, which would have
allowed us to discontinue outsourcing this function. We made this acquisition by
issuing 722,000 shares of our common stock, worth approximately $288,800 or
$0.40 a share on the date of the acquisition, to the stockholders of Corporate
Media Group, Inc., Richard Durand and Susan Durand, and to other key employees.
After the acquisition was made, we issued 245,827 shares of our common stock,
worth approximately $98,328 or $0.40 a share, to two creditors of Corporate
Media Group, Inc., in payment of existing debt. We also raised $150,000 in a
private placement during the last quarter of 2001 and the first quarter of 2002,
borrowed $385,000 from our officers, directors and a shareholder and engaged in
two separate convertible debenture transactions that yielded $240,000 in the
first two quarters of 2002. Approximately 80% of these funds were contributed to
Corporate Media Group, Inc. as working capital to supplement the purchase of raw
materials for ongoing orders and payroll. We were unable to profitably operate
Corporate Media Group, Inc. and we discontinued its operations .

Our Products

Audio Books

With the acquisition of approximately 200 titles produced by Sunset Productions,
Inc., which we completed on April 1, 2002, we currently offer more than 300
audio book titles. All of our audio book inventory is available on our website,
americanabooks.com. With the exception of one audio book that we publish in CD
format, all of our audio books are published on audiotapes. We intend to
increase our production of audio books in CD format.

Consumers who visit our website can listen to a two-minute sample of many of our
audio books. We have also published an "Audio Book Sampler Tape" that highlights
the first two minutes of thirty of our audio books, enabling a listener to get a
flavor for the books. In June 2001 we received an award from the Audio
Publishing Association as the "Best New Audio Book Publisher for 2001".
Additionally, one of our audio book narrators, Charlie O'Dowd, received a
"Golden Headset" award from Audioworld as the "Best Abridged Reader of the
Year".


                                       2




We sell our audio books in the United States to approximately 17,000 retail
stores and approximately 15,000 libraries as well as to large truck stop
distributors including BARJAN, KSG, and Audio Adventures. We also have database
and order processing agreements with Baker and Taylor, Advanced Marketing
Services, Ingram Book Company, Anderson News Company, Books-A-Million/American
Wholesale Book Company, Barnes and Noble, BJ's, Brodart Company, Hastings, Lodes
Tone, Penton Overseas, Professional Media, and Recorded Books. Pursuant to these
database and order processing agreements, the wholesalers or retailers who are
parties to the agreements include our titles in their listings of available
inventory and we include their titles in our listings of available inventory.
While we are not dependent on any single distributor, if we were to lose three
or more of these distributors it would have a material adverse impact on our
revenues and business. During the year ended December 31, 2002, five major
customers represented 17%, 15%, 9%, 4% and 4% of our net sales.

During the fiscal year ended December 31, 2002, audio books accounted for all of
our sales revenues, which totaled $640,848.

Print Books

During 2001, we published and introduced our first print book, The Cowboy. The
Cowboy is a children's book that includes both a print book and an audiotape.
Six additional works of fiction, The Killing Cards, Ground Lions, Beloved Leah,
It Is I, Joseph, Last Chance Out and Family Arrested became available for
shipping in January 2002.

During the fiscal year ended December 31, 2002, there were no sales of our print
books.

Electronic Books

We have developed fifteen electronic books, all of which are available on our
website for purchase and download. While these books are available for purchase,
we are currently working with consultants to develop software that will protect
them from unauthorized duplication. For that reason, we have not undertaken any
significant promotion of these titles.

During the fiscal year ended December 31, 2002, there were no sales of our
electronic books.

Competition

At this time we do not represent a significant competitive presence in the audio
book publishing and selling industry. We are seeking to raise our profile in a
number of ways, including giving higher visibility to lesser known authors,
providing easier ways to find products on our website by use of our specially
designed search engine, providing faster delivery of products sold, and
providing competitive pricing whenever possible. We are also seeking niche
markets, such as the truck stop market, and we are continuing to focus on
publishing book series, which we believe are popular with audio book customers.
We currently publish series works by authors Elaine Viets, Leslie Glass, Cynthia
Davis and Lou Campanozzi.

Government Regulation

In general, other than state or local licensing laws, our business is not
subject to government regulation. Because most of our telemarketing is targeted
to other businesses, we do not believe that the "Do Not Call" legislation, if
ultimately implemented, will have any significant effect on us. Also, because
the percentage of sales we make via the Internet is so low, we do not believe
that legislation taxing Internet sales or otherwise regulating them would have a
material adverse impact on our business.

Employees

We employ 8 full time employees.


                                       3


                        Item 2. DESCRIPTION OF PROPERTY

Our principal offices are located at 303 San Mateo NE, Suite 104A, Albuquerque,
New Mexico 87108. The premises are leased and the condition of the premises is
good. The original lease was for a term of 3 years. Upon the expiration of that
lease in December 2001, we began to lease the premises on a month-to-month
basis. The rent is $3,000 per month.

We lease additional office and warehouse space located at 142 Truman Street,
Albuquerque, New Mexico. The term of the lease is 4 years, and monthly rent
starts at $2,000 per month, escalating over the term of the lease to $5,000 per
month. Through July 2003 we shared this space with a sub-tenant. We anticipate
that we will continue to sub-let a portion of these premises.

Both the building in which our principal office is located and the building in
which the additional office and warehouse space is located are owned by entities
controlled by our President and Chief Executive Officer, George Lovato, Jr.

Until April 30, 2002 Corporate Media Group, Inc. occupied approximately 45,000
square feet of warehouse, office and manufacturing space located at 142 Lupton
Lane, Cleveland, Tennessee, which it rented from Richard Durand, a member of
Corporate Media Group, Inc.'s board of directors. The monthly rent for this
facility was $23,000.00. The facility has been returned to Mr. Durand.

Item 3. LEGAL PROCEEDINGS

Corporate Media Group, Inc. and Susan Durand, a director of Corporate Media
Group, Inc., are co-defendants in a suit filed by First Tennessee Bank in the
Circuit Court of Bradley County, Tennessee, as Civil Action No. V-02-450. First
Tennessee Bank sought damages of $38,900. The case was settled in August 2002
for the sum of $28,668. Of this amount, $5,668 was paid on the settlement date
and the remaining $23,000 was payable in 12 equal monthly installments of
$1,916.66. These payments began on October 1, 2002 and were paid as scheduled.
No further payments are due.

Americana Publishing, Inc. and Corporate Media Group, Inc. were named as
co-defendants in an action titled Eva-Tone, Inc. vs. Corporate Media Group,
Inc. and Americana Publishing, Inc, which was filed on April 20, 2002 in the
Circuit Court of Bradley County, Tennessee as Civil Action No. V-02-378.
Eva-Tone, Inc. is seeking to recover damages of $26,350.00. On February 18, 2003
an order was entered dismissing us from the action but permitting Eva-tone, Inc.
to proceed against Corporate Media Group, Inc. We were dismissed from the action
because the court determined that we were not a proper party to it.

In December 2002 we filed an action against Richard Durand and Susan Durand in
the District Court of Bernalillo County, New Mexico, alleging fraud and
misrepresentation with respect to the value of certain assets of Corporate Media
Group, Inc. transferred to us. We are seeking the return of 624,000 shares of
common stock that were transferred to Richard Durand and Susan Durand as
consideration for our purchase of the outstanding stock of Corporate Media
Group, Inc. We are also seeking judgment against Richard Durand and Susan Durand
for $612,000 in damages.

We were sued in 2002 by a former employee in an action titled Timothy A. Braun,
Plaintiff vs. Americana Publishing, Inc., Defendant, No. CT 02-013538. This
action was filed in the District Court, County of Hennepin, State of Minnesota,
Fourth Judicial District. Mr. Braun alleged that we breached his employment
agreement. He sought $50,000 in cash and 500,000 shares of our common stock. We
settled the action in January 2003 by transferring to Mr. Braun 200,000 shares
of our common stock and agreeing to pay him the sum of $15,750 in monthly
installments of $2,500. All the installments have been paid.

Corporate Media Group, Inc., was a defendant in a lawsuit filed in June 1997 by
Cinram, Inc. in the U.S. District Court for the Southern District of Indiana,
Indianapolis District. In July 2001 Corporate Media Group, Inc. entered into a
settlement agreement and stipulated judgment with Cinram, Inc. for the amount of
$245,000. Due to a default by Corporate Media Group, Inc. of its settlement
agreement with Cinram, Inc., Cinram, Inc. had the judgment entered in April
2002. Pursuant to the judgment, Cinram, Inc. seized approximately $100,000 from
Corporate Media Group, Inc. Corporate Media Group, Inc. currently owes
approximately $145,000 to Cinram, Inc. in connection with this judgment.


                                      4




On August 5, 2003 Corporate Media Group, Inc. filed a petition in the United
States Bankruptcy Court for the Eastern District of Tennessee, Southern and
Winchester Divisions, in Chattanooga Tennessee. The petition seeks relief under
Chapter 7 of the United States Bankruptcy Code.

           Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

There were no matters  put to the  security  holders  for a vote during the last
quarter of 2002.

                                 Part II

                    Item 5. MARKET FOR AMERICANA COMMON STOCK
                         AND RELATED SHAREHOLDER MATTERS

Our common stock began trading on the over-the-counter bulletin board on
November 8, 1999. Our ticker symbol is APBH. The following table represents the
closing high and low bid information of sales of our common stock during the
last two fiscal years. The quotations reflect inter-dealer prices, without
retail mark-up, mark-down or commission and may not represent actual
transactions. The market for our common stock is sporadic.

2002                                 High                   Low
First Quarter                       $0.25                  $0.13
Second Quarter                      $0.52                  $0.09
Third Quarter                       $0.09                  $0.05
Fourth Quarter                      $0.12                  $0.03

2001

First Quarter                       $0.63                  $0.28
Second Quarter                      $0.50                  $0.22
Third Quarter                       $0.55                  $0.32
Fourth Quarter                      $0.54                  $0.18

There were approximately 148 holders of common stock as of December 31, 2002. We
have not paid any dividends in the past and currently we have no plans to pay
dividends in the foreseeable future.

Equity Compensation Plan Information

In June 2000 our Board of Directors adopted, and on March 24, 2001 our
shareholders approved, the Americana Publishing Inc. 2000 Stock Purchase and
Option Plan. We reserved 5,000,000 shares of our common stock for issuance
pursuant to this Plan. Pursuant to this plan, awards may be granted to our key
employees, officers and consultants.

The following chart gives aggregate information regarding grants under this plan
as of December 31, 2002.

   Plan Category     Number of Securities to be   Weighted-averaged exercise      Number of securities
                     issued upon exercise of      price of outstanding options,   remaining
                     outstanding options,         warrants and rights             under equity
                     warrants and rights                                          compensation plans
                                                                                 (excluding securities
                                                                                  reflected in
                                                                                  first column)
-----------------------------------------------------------------------------------------------------------------

Equity Compensation
plan approved by
security holders        2,350,000                      $0.24                           2,650,000

Equity Compensation
plan not approved by
security holders             0                           N/A                                 0

On May 16, 2003 our Board of Directors adopted the Americana Publishing Inc.
2003 Equity Incentive Plan. This plan has not been approved by our shareholders.
We reserved 20,000,000 shares of our common stock for issuance pursuant to this
plan. Pursuant to this plan, awards may be granted to our employees, officers
and directors as well as to consultants, independent contractors and advisors,
provided that such consultants, contractors and advisors render bona fide
services not in connection with the offer and sale of securities in a
capital-raising transaction.


                                       5


Recent Sales of Unregistered Securities

In March 2002, we entered into an agreement with Karim Amiryani, Douglas W.
Jordan, Douglas W. Jordan Defined Benefit Pension Plan, Norman Ross, Tel Pro
Marketing, Stranco Investments and Vestcom to purchase from us $140,000 in
principal amount of 10% convertible debentures. Subsequently, these 10%
convertible debentures were cancelled and 12% senior convertible debentures were
substituted therefore.

As of April 1, 2002 we signed a securities purchase agreement with BG Holdings,
LLC, referred to in this discussion as BG Holdings, and Gulf Coast Advisors,
Ltd., referred to in this discussion as Gulf Coast. Pursuant to the agreement,
BG Holdings and Gulf Coast agreed to purchase an aggregate of $200,000 in
principal amount of our 12% senior secured convertible debentures, which were to
mature on April 1, 2003. Together with such debentures, BG Holdings and Gulf
Coast were also issued Class A warrants and Class B warrants. The first $100,000
in aggregate principal amount of our 12% senior secured convertible debentures,
from which we received net proceeds of $80,000, was issued to BG Holdings and
Gulf Coast upon execution of the securities purchase agreement. The second
$100,000 in aggregate principal amount of our 12% senior secured convertible
debentures were to be issued to BG Holdings and Gulf Coast upon the
effectiveness of a registration statement covering shares of our common stock
issuable upon the conversion of the debentures and upon exercise of the Class A
Warrants and the Class B Warrants. We filed an SB-2 registration statement on
July 16, 2002 (SEC file number 333-92422). The registration statement has not
been declared effective.

The debentures were to bear interest at the annual rate of 12%, payable
quarterly in cash or in shares of our common stock, at the discretion of the
holders. If the holders elected to receive interest in the form of common stock,
the number of shares of common stock to be received was to be based on the
amount of the interest payment, including penalty interest, if any, divided by
the conversion price, which was $0.0615, based on a closing date of April 1,
2002. In the event we failed to pay any quarterly interest payment on the date
such payment was due, the interest payable on the principal amount of the
debentures and on all accrued and unpaid interest would increase to 18%, or the
penalty interest rate, until all accrued interest, including penalty interest,
was paid in full.

We had the right to redeem, upon 180 calendar days' notice to the holders, each
of the debentures prior to maturity at 140% of the outstanding principal amount
of the debentures, in addition to any unpaid interest and any default and
penalty payments due.

BG Holdings and Gulf Coast had the right to immediately convert the debentures
into shares of our common stock. The conversion price for the debentures was
equal to 50% of the lesser of the average of the three lowest closing bid prices
per share for our common stock, as reported on the over-the-counter electronic
bulletin board, or such other public market that our common stock was then
traded on, during either the 30 trading days prior to the closing, or the 30
trading days prior to the date of conversion of all or any part of the
debentures. The conversion price was $0.0615, based on a closing date of April
1, 2002.

The Class A warrants issued to BG Holdings and Gulf Coast pursuant to the
securities purchase agreement had a term that expired on April 1, 2009. The
Class A warrants were exercisable into an amount of our common stock that was
equal to the quotient of the principal amount of each debenture divided by its
conversion price. BG Holdings and Gulf Coast had sole discretion with respect to
when and if they chose to exercise any of these warrants prior to expiration.
The exercise price of the Class A warrants was to be an amount equal to 50% of
the lesser of the average of the lowest three closing bid prices of our common
stock as reported by the over-the-counter electronic bulletin board or such
other exchange where our common stock was then trading during the 30 trading
days prior to closing, or the 30 trading days immediately prior to the date or
dates all or any portion of the warrants were exercised. The Class A warrants
contained a cashless exercise feature, allowing the holders to surrender Class A
warrants in payment of the exercise price for other Class A warrants.


                                       6




The Class B warrants issued to BG Holdings and Gulf Coast pursuant to the
securities purchase agreement had a term that expired two years after the
effective date of the registration statement registering the common stock
issuable upon exercise of such warrants. The Class B warrants were exercisable
into an amount of our common stock equal to five times the quotient of the
principal amount of each debenture divided by its conversion price. BG Holdings
and Gulf Coast had sole discretion with respect to when and if they chose to
exercise any of these warrants prior to expiration. The purchase price under the
Class B warrants was to be an amount equal to the lesser of 105% of the average
of the lowest three closing bid prices of our common stock as reported by the
over-the-counter bulletin board or such other exchange where our common stock
was then trading during the 30 trading days prior to closing, or 50% of the
average of the lowest three closing bid prices of our common stock as reported
by the over-the-counter electronic bulletin board or such other exchange where
our common stock was trading during the 30 trading days immediately prior to the
date or dates all or any portion of the warrants were exercised. The Class B
warrants did not contain a cashless exercise feature.

In April 2002 the debentures and warrants were delivered to BG Holdings and Gulf
Coast and $80,000 in net proceeds was transferred to us.

The securities issued in these two offerings were issued pursuant to an
exemption provided by Rule 506 of Regulation D of the Securities Act of 1933.

On June 15, 2003 a restructuring agreement was entered into between Advantage
Fund, LLC and all of the investors who held our 12% debentures. Pursuant to the
restructuring agreement,

(i)  the shares that had been issued to Gulf Coast and BG Holdings were returned
     to treasury;

(ii) Advantage Fund LLC and its designees  exercised the Class A Warrants and we
     issued to them a total of 22,142,847 shares of our restricted common stock.
     The sales of these  securities were made pursuant to an exemption  provided
     by Section 4(2) of the Securities Act of 1933;

(iii) the Class B Warrants were retired;

(iv) the principal amount of the debentures was increased to $337,195;

(v)  the  interest  rate  of the  debentures  was  reduced  to 6%  and  is  paid
     quarterly; and

(vi) the due date of the debentures was extended until June 15, 2005.

Payment of the debentures is secured by our assets. Holders of the debentures
may choose to accept shares of our common stock in lieu of cash in payment of
the principle amount and any interest accrued thereon. If all of the debenture
holders demanded that principle and interest be paid with shares of our common
stock, we would issue a number of shares of common stock equal to the amount of
principle and interest owed divided by the "Conversion Price", which is defined
in the debenture as an amount equal to the lesser of the average of the three
lowest closing bid prices per share for the common stock, as reported on the
over-the-counter electronic bulletin board, or such other public market that the
common stock is then traded, during either: (i) the 30 trading days prior to the
closing of the sale of the debentures; or (ii) the 30 trading days prior to the
date of conversion. The average of the three lowest closing bid prices per share
for the common stock on the date of closing was $0.02. Therefore, if all the
principle and interest owed pursuant to the debentures was paid with common
stock, the number of shares of common stock we would be required to issue would
be 22,510,600 shares.

Based on the forgoing, we intend to withdraw the registration statement we filed
on July 16, 2002.


                                       7




During the 2002 fiscal year,  13,965,601  shares of our common stock were issued
to the following individuals:

o    1 million shares were issued to our Chief Executive  Officer and President,
     George Lovato;

o    500,000 shares were issued to our Chief Financial Officer, Don White;

o    500,000  shares were issued to Dr. David  Poling,  a member of our Board of
     Directors;

o    1,077,000 shares were issued to various employees; and

o    10,888,601 shares were issued to various consultants.

All of this stock was issued in lieu of cash compensation for services rendered
or as a bonus for extraordinary services rendered. The common stock was issued
at an average price of $0.27 per share to employees, officers and directors for
total services valued at $274,586 and to consultants for total services valued
at $992,055. These transactions were made pursuant to an exemption provided by
Section 4(2) of the Securities Act of 1933.

During January 2002 we conducted a private offering of our common stock to
accredited investors. We sold 261,666 shares at a value of $0.15 per share for
total proceeds of $39,249.90. This transaction was exempt from registration
pursuant to Rule 506 of Regulation D of the Securities Act of 1933.

In February 2002 we sold 1,000,000 shares of our common stock, having a value of
$0.10 per share, to Anthony Broy, an accredited investor, for a purchase price
of $100,000. This transaction was exempt from registration pursuant to section
4(2) of the Securities Act of 1933.

On April 1, 2002 we issued 250,000 shares of our common stock, valued at $0.027
per share, to Jerome Ruther for the purchase of inventory and master tapes
produced by Sunset Productions, Inc. and subsequently acquired by Mr. Ruther.
The inventory and master tapes were valued at $67,500. This transaction was
entered into in reliance on an exemption provided by Section 4(2) of the
Securities Act of 1933.

                Item 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                 FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Management's discussion and analysis of results of operations and financial
condition are based upon our financial statements. These statements have been
prepared in accordance with accounting principles generally accepted in the
United States of America. These principles require management to make certain
estimates, judgments and assumptions that affect the reported amounts of assets,
liabilities, revenues and expenses, and related disclosure of contingent assets
and liabilities. On an on-going basis, we evaluate our estimates based on
historical experience and various other assumptions that are believed to be
reasonable under the circumstances, the results of which form the basis for
making judgments about the carrying values of assets and liabilities that are
not readily apparent from other sources. Actual results may differ from these
estimates under different assumptions or conditions.

GENERAL

We were incorporated in Colorado in April 1997. We are a multi-media publishing
company. Our primary business is the publication and sale of audio books, but we
also offer print books and electronic books. Thus far, all of our revenues have
been earned from the sale of audio books.

In July 2001 we acquired Corporate Media Group, Inc. in an attempt to vertically
integrate our reproduction and duplication activities as they relate to our
audio book operation. The consideration for the acquisition consisted of 772,000
shares of our common stock that we issued to Richard and Susan Durand and other
key employees. Additionally, we issued 245,827 shares of our common stock,
valued at approximately $98,328 or $0.40 per share, to two creditors of
Corporate Media Group, Inc., in payment of existing debt. After we made this
acquisition, we raised $150,000 through the sale of our common stock in a
private placement, borrowed $385,000 from officers and directors and engaged in
two separate convertible debenture transactions that yielded $240,000. Over 70%
of these funds were contributed to Corporate Media Group, Inc. as working
capital to supplement the purchase of raw materials for ongoing orders and
payroll. We discontinued the operations of Corporate Media Group, Inc. in April
2002. This action was taken due to a lack of working capital, part of which was
to be generated by refinancing certain equipment belonging to Corporate Media
Group, Inc. The value of this equipment was insufficient to support an adequate
loan to value ratio for lending purposes. Furthermore, due to a decline in sales
that we believe was due partially as a result of a decline in quality control
and partially as a result of the terrorist attacks of September 11, 2001,
Corporate Media Group, Inc. was unable to support either increased debt service
or its general day-to-day operating expenses.


                                       8




We currently have limited internal and external sources of liquidity. At this
time, aside from what we will spend on the production of audio masters, we have
made no material commitment for capital expenditures. During the year ended
December 31, 2002, we spent approximately $79,606 for the production of audio
masters. During the 2003 fiscal year, we anticipate that we will spend
approximately $110,000 on audio masters, and that they will represent our only
capital expenditure. This increase is due to the increase in the number of
titles we have available.

Other than the general decline in the economy of the United States, which
affects the discretionary spending of consumers, and the uncertainty related to
whether or not we will be able to raise working capital when we need it, we do
not know of any trends, events or uncertainties that are expected to have a
material impact on our net sales and income from continuing operations. Sales of
our books are not seasonal in nature, although we may experience an increase in
sales during the year-end holidays.

RESULTS OF OPERATIONS

Year Ended December 31, 2002 Compared to Year Ended December 31, 2001

Our revenues from operations for the year ended December 31, 2002 were $640,848
as compared to revenues of $259,680 for the year ended December 31, 2001, an
increase of 246%. Revenues increased due to our acquisition of the inventory of
Sunset Productions, Inc., which increased the titles we made available for sale,
and the increased sales of our audio books that resulted from the placement of
our products in truck stops.

Our gross profit from operations for the fiscal year ended December 31, 2002
increased to $537,328 as compared to $197,635 for the fiscal year ended December
31, 2001. Our gross margin percent increased to 83.8% in fiscal year 2002 from
76.1% in fiscal year 2001. The increase in gross profit from operations is
attributable to our increased sales while the increase in gross margin percent
is attributable to increased volume in unit sales which resulted from a
reduction of the per unit costs of our products.

Selling, general and administrative costs decreased by $1,142,641, to $2,159,139
for the year ended December 31, 2002 as compared to $3,301,780 for the year
ended December 31, 2001, a 34% decrease. This decrease is primarily attributable
to a reduction in the amount of stock compensation granted in lieu of cash
compensation to officers, directors and consultants and to the fact that we used
fewer consultants during the year ended December 31, 2002. General and
administrative expenses consist primarily of salaries and related expenses for
executive, finance and other administrative personnel, recruitment expenses,
professional fees and other corporate expenses, including business development.

Interest expense increased during the year ended December 31, 2002 by $33,640 to
$61,804 as compared to $28,164 for the year ended December 31, 2001, an increase
of 119%. The additional interest expense during the year ended December 31, 2002
was incurred as a result of our decision to factor our accounts receivable and
also due to our decision to pay part of the interest expense that had been
incurred by Corporate Media Group, Inc. to First Tennessee Bank.

Our total loss from operations (before taking into account loss from
discontinued operations) was $1,724,162 for the year ended December 31, 2002 as
compared to a loss from operations of $3,425,095 for the year ended December 31,
2001, a decrease of $1,700,933. The decrease in net loss from operations was
primarily attributable to increased sales and reduced wage and salary expense.




                                       9



Loss from discontinued operations was $829,552 for the year ended December 31,
2002 as compared to a loss from discontinued operations of $1,937,270 for the
year ended December 31, 2001. The loss from discontinued operations declined in
the year ended December 31, 2002 because Corporate Media Group, Inc. ceased
operations in April 2002.

Our net loss for the year ended December 31, 2002 was $2,615,518 as compared to
$5,775,333 in net loss for the year ended December 31, 2001. The reduction in
net loss came as a result of the termination of Corporate Media Group, Inc. as
an operating entity in April 2002, our increased sales, and a reduction in our
wage and salary expenses that resulted from a reduction in the number of
consultants we employed during the fiscal year ended December 31, 2002 and the
reduction in the number of our employees due to the termination of operations by
Corporate Media Group, Inc.

GOING CONCERN

Our financial statements have been prepared on a going concern basis, which
contemplates the realization of assets and the satisfaction of liabilities in
the normal course of business. During the years ended December 31, 2002 and
2001, we incurred losses of $2,615,518 and $5,775,333, respectively. In
addition, as of December 31, 2002, our total current liabilities exceeded our
total current assets by $2,793,597, and our shareholders' deficit was
$2,519,083. These factors, among others, raise substantial doubt about our
ability to continue as a going concern. Our attainment of profitable operations
is dependent upon our ability to obtain adequate debt or equity financing and to
achieve a level of sales adequate to support our operations. We plan to engage
the services of a broker to assist us with capital raising. In order to increase
our sales, we intend to continue to license authored works and to seek
compatible products or businesses that we may be able to acquire. Because our
cash resources are limited, we anticipate that acquisitions must be made with
our common stock. Due to the low per-share price of, and the sporadic trading
market for, our common stock, we may be unsuccessful in making any acquisitions.
If we are unable to find debt or equity financing or to increase our sales to an
amount that can support our operations, we may never be profitable. We do not
anticipate being able to generate sufficient cash flow to support our operations
during the next 12 months.

LIQUIDITY AND CAPITAL RESOURCES

At December 31, 2002 we had no cash or cash equivalents on hand. Our primary
source of cash during the year ended December 31, 2002 consisted of loans and
proceeds raised from the sale of our securities. All of our assets have been
pledged to two creditors. At December 31, 2002 we had a net loss from continuing
operations of $1,785,966.

Net cash used in operating activities during the year ended December 31, 2002
was $407,614 as compared to $815,874 of net cash used in operating activities
during the year ended December 31, 2001, a decrease of $408,260 that is
primarily attributable to our decision to discontinue the operations of
Corporate Media Group, Inc. The primary use of cash for the year ended December
31, 2002 consisted of $816,589 and $274,586 in common stock issued,
respectively, to outside consultants and to executive officers and members of
the Board of Directors for services rendered. We also experienced increases in
factor payables to $167,551, in accounts payable to $186,133, and in accrued
expenses to $104,576. These increases resulted primarily from the addition of
200 titles to our inventory, which increased our sales, and to increased
production costs for development of new titles. These expenses were offset by
increases in accounts receivable of $271,611 and in inventory of $26,904, which
resulted from the 200 additional titles we acquired and the new titles we
produced during the year ended December 31, 2002. In 2001 we recognized a charge
in the amount of $188,215 for impairment to audio production costs. We
determined that the future cash flows associated with the audio production
costs, which are made up of studio time and voice talent, would be less than the
audio production costs. We pay approximately $500 per hour for voice talent and
$1,500 per hour for studio time. The impairment charge was made up of
approximately $30,114 in charges for voice talent and $158,101 in charges for
studio time. We did not have a comparable charge for the year ended December 31,
2002. We expect that the increase in our revenues, together with the termination
of Corporate Media Group, Inc.'s operations, will improve our cash flow.

Net cash used in investing activities totaled $28,981 for the year ended
December 31, 2002 as compared to net cash provided by investing activities in
the amount of $18,266 for the year ended December 31, 2001. Cash was used for
the purchase of audio tape and CD stock for master recordings and for studio
time and voice talent during the fiscal year ended December 31, 2002. During the
year ended December 31, 2001, cash in the amount of $11,734 was used for the
purchase of property and equipment while cash was provided by a certificate of
deposit in the amount of $30,000.

Net cash provided by financing activities totaled $585,770 for the year ended
December 31, 2002 as compared to net cash provided by financing activities
totaling $502,506 for the year ended December 31, 2001. Net cash provided by
financing activities during the year ended December 31, 2002 consisted of
proceeds from notes payable in the amount of $130,615 and proceeds from the sale
of our securities totaling $303,988.

During the year ended December 31, 2002, we also paid $61,805 in interest
expense relating to obligations of our subsidiary, Corporate Media Group, Inc.


                                       10


Our attainment of profitable operations is dependent upon our ability to fully
implement our business plan, which anticipates the expansion of our business
through the acquisition of other publishers and complementary businesses, such
as a printing business and a heat set web press business, obtaining adequate
financing when we need it and achieving a level of sales adequate to support our
operations.

We plan to acquire companies by using shares of our common stock, although we
are not presently engaged in any negotiations with, nor do we have any
commitments to, any person or entity to acquire any business or assets. We
believe that active trading of our common stock will be important to the
principals of target companies and future acquisitions may be dependent on the
active trading of our common stock. However, our common stock has not been
actively traded and, if our common stock continues to trade flatly, we may not
be able to make acquisitions , without disproportionate dilution of existing
stockholder interests.

During the next 12 months we will finance our operations primarily through
revenues from sales of our products although, if our revenues are inadequate, we
will be required to seek additional funds through sales of our securities or
from related party loans. We currently have no commitments for future financing,
and we cannot guarantee that we will be successful in raising additional capital
when we need it. If we need money for our operations but we are not successful
in generating sufficient revenues, raising money through the sale of our
securities or borrowing money, we may be required to significantly curtail, or
to cease, our operations.

We plan to increase revenues by continuing to acquire new titles and by looking
for niche markets for our products. We recently began placing our products in
truck stops throughout the United States. We may also develop other types of
products that are attractive to purchasers in the truck stop market.

During 2002, we entered into an asset based line of credit factoring agreement
with Langsam Borenstein Partnership. Pursuant to this agreement, we sell
selected accounts receivable to Langsam Borenstein Partnership in the face
amount of no less than $5,000 per month. Langsam Borenstein Partnership charges
a varying commission on each invoice sold, depending on the number of days
payment is outstanding. The commission may vary from 4% to 10%. This agreement
has no set term and may be cancelled by either party on notice to the other. As
part of this transaction, we granted to Langsam Borenstein a security interest
in our assets, including our receivables. This security interest is subordinate
to the security interest granted to the holders of our 6% Convertible
Debentures.

In September, October and November 2001 our director, Jerome Ruther, loaned us
$100,000, $100,000 and $100,000, respectively. Each loan accrues interest at the
rate of 30% per year. Interest is to be paid monthly and principle is to be paid
one year from the date of the loan. This obligation is currently in default, as
no payments of principle or interest have been paid toward this obligation. To
date, no demand for payment or attempt to collect this obligation has been made
by Mr. Ruther. Payment of each of these obligations is secured with 500,000
shares of our common stock.

In December 2001 our Chief Financial Officer and director, Don White, loaned us
$10,000. The loan accrues interest at the rate of 30% per year. Interest is to
be paid monthly and principle is to be paid one year from the date of the loan.
This obligation is currently in default, as no payments of principle or interest
have been paid toward this obligation. To date, no demand for payment or attempt
to collect this obligation has been made by Mr. White. Payment of this
obligation is secured with 100,000 shares of our common stock.

A shareholder loaned us $50,000, $2,500 and $25,000 in September 2002, November
2002 and December 2002, respectively. Each loan accrues interest at the rate of
30% per year. Interest is to be paid monthly and principle is to be paid three
years from the date of the loan. We are making the monthly interest payments
toward these obligations as scheduled.

We have failed to pay any of the above loans in accordance with their terms. If
they choose to do so, the holders of the promissory notes could declare the
loans in default and foreclose on the collateral. The note holders could also
file legal actions against us. If that were to happen, it would divert
management's attention from the business and require us to incur legal fees and
expenses to defend the actions. If we were unsuccessful in our defense actions,
in addition to the payment of the principal and interest and our legal fees and
expenses, we would be responsible for paying the note holders' collection costs
and attorney's fees. Attempts at collection of these debts could effect our
ability to continue our operations.

In March 2002, we entered into an agreement with Karim Amiryani, Douglas W.
Jordan, Douglas W. Jordan Defined Benefit Pension Plan, Norman Ross, Tel Pro
Marketing, Stranco Investments and Vestcom to purchase from us $140,000 in
principal amount of 10% convertible debentures. Subsequently, these 10%
convertible debentures were cancelled and 12% senior convertible debentures were
substituted therefor. These debentures and warrants, along with the debentures
we issued on April 1, 2002, were restructured pursuant to the agreement
described in the section below titled "Subsequent Events".


                                       11



On April 1, 2002, we signed a securities purchase agreement with a number of
investors who agreed to purchase an aggregate of $200,000 in principal amount of
our 12% senior secured convertible debentures, which were to mature on April
2003. Together with such debentures, the investors were also issued Class A
warrants and Class B warrants. This agreement was restructured on June 15, 2003,
as described in the section below titled "Subsequent Events". Pursuant to the
restructuring agreement, the principal amount of the debentures was increased to
$337,195, the interest rate of the debentures was reduced to 6% and is paid
quarterly and the due date of the debentures was extended until June 15, 2005.
Payment of the debentures is secured by our assets.

As of April 30, 2002, the date that its operations were closed, our subsidiary,
Corporate Media Group, Inc., had outstanding obligations of approximately
$3,600,000. These obligations included a $600,000 line of credit with Volunteer
National Bank and various capital lease agreements. The line of credit was
secured by all of Corporate Media Group, Inc.'s inventory, furniture, fixtures,
equipment and other assets and the capital leases were secured by the equipment
being leased. Due to non-payment, Corporate Media Group, Inc. defaulted on all
of these obligations, resulting in foreclosure actions by its secured creditors.
At the time it filed a petition in bankruptcy, Corporate Media Group, Inc. had
over 100 creditors. Below is a table listing those creditors of Corporate Media
Group, Inc. that had claims in excess of $10,000:

Name of Vendor and Obligation                             Amount Owed

Accountemps (Temporary Labor)                              $  12,671
Ambrose Printing Co. (Printing and distribution)              63,464
Americana Publishing, Inc. (Legal claim)                     610,051
American Multimedia, Inc. (Merchandise)                       70,795
American Recordable Media (Services)                          17,814
AMI Pro Sound & Video, Inc.(Video reproduction)               19,170
Blair Industries, Inc. (Merchandise)                          18,354
Callahan Packaging & Fulfillment (Product assembly)           22,063
Caterpillar Financial Services (Equipment lease)              17,340
Challenge Printing, Inc. (Printing)                           47,424
Cinram, Inc. (Distribution)                                  137,496
Citibank Gold Aadvantage (Merchandise/Loan)                   23,774
Colour Works (Distribution)                                   10,477
Deutsche Financial Services (Equipment lease)                 86,455
Disc Graphics Inc. (Duplication services)                     27,630
DBX Video Tapes, Inc. (Duplication services)                 836,083
DBX Videotapes of Georgia LLC (Duplication services)          62,611
Eva-Tone, Inc. (Printing services)                            31,350
First USA Bank, NA (Merchandise)                              27,897
First Volunteer Bank (Loan)                                  201,249
L & M Optial Disc, LLC (Disk production)                     164,057
LG Electronics, Inc. (Services)                               19,969
Maureen Hensley Packaging Design (Services)                   10,087
Mellex International Corp. (Services)                         27,026
Old Dominion Freight Lines (Freight costs)                    11,495
Richard and Susan Durand (Real property lease)               250,000
Sony Disc Manufacturing (Merchandise)                         43,639
Sony Financial (Equipment Lease)                             243,687
Symmetry Group, Inc. (Video tapes)                           115,686
T.A.P.E. (Services)                                           14,361
United Parcel Service (Freight charges)                       40,471
US Bancorp Card Services, Inc. (Merchandise)                  31,409
Vaughn Associates (Video tapes)                               29,909
WEA Manufacturing (Merchandise)                               76,198
Yellow Freight Systems, Inc. (Freight)                        28,168

We do not expect to experience adverse consequences as a result the default by
Corporate Media Group, Inc. on these obligations. We expect all of these debts
to be discharged as a result of the bankruptcy proceeding. Corporate Media
Group, Inc. will no longer operate, and will not be required to continue
obtaining services from its vendors.


                                       12



SUBSEQUENT EVENTS

On June 15, 2003 a restructuring agreement was entered into between Advantage
Fund, LLC and the investors who had purchased our 12% debentures. Pursuant to
the restructuring agreement,

(i) certain shares that had been issued in conjunction with the original
transaction were returned to treasury;

(ii) Advantage Fund LLC and its designees exercised the Class A Warrants and we
issued to them a total of 22,142,847 shares of our restricted common stock;

(iii) the Class B Warrants were retired;

(iv) the principal amount of the debentures was increased to $337,195;

(v) the interest rate of the debentures was reduced to 6%; and

(vi) the due date of the debentures was extended until June 15, 2005.

Payment of the debentures is secured by our assets.

On August 2, 2003 Corporate Media Group, Inc., our subsidiary filed for relief
under Chapter 7 of Title 11, United States Bankruptcy Code for the Eastern
District of Tennessee, Case No. 03-15217.

Recently Issued Accounting Pronouncements

In June 2001, the Financial Accounting Standards Board ("FASB") issued SFAS No.
141, "Business Combinations." This statement addresses financial accounting and
reporting for business combinations and supersedes APB Opinion No. 16, "Business
Combinations," and SFAS No. 38, "Accounting for Pre-Acquisition Contingencies of
Purchased Enterprises." All business combinations in the scope of this statement
are to be accounted for using one method, the purchase method. The provisions of
this statement apply to all business combinations initiated after June 30, 2001.
Use of the pooling-of-interests method for those business combinations is
prohibited. This statement also applies to all business combinations accounted
for using the purchase method for which the date of acquisition is July 1, 2001
or later. The Company does not expect adoption of SFAS No. 141 to have a
material impact, if any, on its financial position or results of operations.

In June 2001, the FASB issued SFAS No. 142, "Goodwill and Other Intangible
Assets." This statement addresses financial accounting and reporting for
acquired goodwill and other intangible assets and supersedes APB Opinion No. 17,
"Intangible Assets." It addresses how intangible assets that are acquired
individually or with a group of other assets (but not those acquired in a
business combination) should be accounted for in financial statements upon their
acquisition. This statement also addresses how goodwill and other intangible
assets should be accounted for after they have been initially recognized in the
financial statements. It is effective for fiscal years beginning after December
15, 2001. Early application is permitted for entities with fiscal years
beginning after March 15, 2001, provided that the first interim financial
statements have not been issued previously. The Company does not expect adoption
of SFAS No. 142 to have a material impact, if any, on its financial position or
results of operations.

In June 2001, the FASB issued SFAS No. 143, "Accounting for Asset Retirement
Obligations." This statement applies to legal obligations associated with the
retirement of long-lived assets that result from the acquisition, construction,
development, and/or the normal operation of long-lived assets, except for
certain obligations of lessees. This statement is not applicable to the Company.

In August 2001, the FASB issued SFAS No. 144, "Accounting for the Impairment or
Disposal of Long-Lived Assets." This statement addresses financial accounting
and reporting for the impairment or disposal of long-lived assets. This
statement replaces SFAS No. 121, "Accounting for the Impairment of Long-Lived
Assets and for Long-Lived Assets to be Disposed Of," the accounting and
reporting provisions of APB No. 30, "Reporting the Results of Operations -
Reporting the Effects of Disposal of a Segment of a Business, and Extraordinary,
Unusual, and Infrequently Occurring Events and Transactions," for the disposal
of a segment of a business, and amends Accounting Research Bulletin No. 51,
"Financial Statements," to eliminate the exception to consolidation for a
subsidiary for which control is likely to be temporary. The Company does not
expect adoption of SFAS No. 144 to have a material impact, if any, on its
financial position or results of operations.


                                       13



In April of 2002, the FASB issued SFAS No. 145, "Rescission of FASB Statements
No. 4, 44, and 64, Amendments of FASB statement No. 13 and Technical
Corrections." This Statement rescinds FSAB Statement No. 4, Reporting Gains and
Losses from Extinguishment of Debt, and an amendment of that Statement, FASB
Statement No. 64, Extinguishments of Debt Made to Satisfy Sinking-Fund
Requirements. This Statement also rescinds FSAB Statement No. 44, Accounting for
Intangible Assets or Motor Carriers. This Statement amends FASB Statement No.
13, Accounting for Leases, to eliminate an inconsistency between the required
accounting for sale-leaseback transactions and the required accounting for
certain lease modifications that have economic effects that are similar to
sale-leaseback transactions. This Statement also amends other existing
authoritative pronouncements to make various technical corrections, clarify
meanings, or describe their applicability under changed conditions. The Company
does not expect adoption of SFAS No. 145 to have a material impact, if any, on
its financial position or results of operation.

In August of 2002, the FASB issued SFAS No. 146, "Accounting for Costs
Associated with Exit or Disposal Activities". This Statement addresses financial
accounting and reporting for costs associated with exit or disposal activities
and nullifies Emerging Issues Task Force (EITF) Issue No. 94-3, "Liability
Recognition for Certain Employee Termination Benefits and other Costs to Exit an
Activity (Including Certain Costs Incurred in a Restructuring)." The Company
does not expect adoption of SFAS No. 146 to have a material impact, if any, on
its financial position or results of operation.

In October of 2002, the FASB issued SFAS No. 147, "Acquisitions of Certain
Financial Institutions - an Amendment of FASB Statement No. 72 and 144 and FASB
Interpretation No. 9". Except for transactions between two or more mutual
enterprises, this Statement removes acquisitions of financial institutions from
the scope of both Statement 72 and Interpretation 9 and requires that those
transactions be accounted for in accordance with FASB Statements No. 141,
Business Combinations, and No. 142, Goodwill and Other Intangible Assets. Thus,
the requirement in paragraph 5 of Statement 72 to recognize (and subsequently
amortize) any excess of the fair value of liabilities assumed over the fair
value of tangible and identifiable intangible assets acquired as an
unidentifiable intangible asset no longer applies to acquisitions within the
scope of this Statement. In addition, this Statement amends FASB Statement No.
144, Accounting for the Impairment or Disposal of Long-Lived Assets, to include
in its scope long-term customer-relationship intangible assets of financial
institutions such as depositor- and borrower-relationship intangible assets and
credit cardholder intangible assets. Consequently, those intangible assets are
subject to the same undiscounted cash flow recoverability test and impairment
loss recognition and measurement provisions that Statement 144 requires for
other long-lived assets that are held and used. The Company does not expect
adoption of SFAS No. 147 to have a material impact, if any, on its financial
position or results of operation.

In December of 2002, the FASB issued SFAS No. 148, "Accounting for Stock Based
Compensation-Transition and Disclosure - an amendment of FASB Statement No.
123". This Statement amends FASB Statement No. 123, Accounting for Stock-Based
Compensation, to provide alternative methods of transition for a voluntary
change to the fair value based method of accounting for stock-based employee
compensation. In addition, this Statement amends the disclosure requirements of
Statement 123 to require prominent disclosures in both annual and interim
financial statements about the method of accounting for stock-based employee
compensation and the effect of the method used on reported results. The Company
does not expect adoption of SFAS No. 148 to have a material impact, if any, on
its financial position or results of operation.


                                       14



Factors Affecting Business, Operating Results and Financial Condition

An investment in our securities is very speculative and involves a high degree
of risk. You should carefully consider the following risk factors, along with
the other matters referred to in this Annual Report, before you decide to buy
our securities. If you decide to buy our securities, you should be able to
afford a complete loss of your investment.

Our independent certified public accountants have stated that our recurring
losses from operations and our accumulated deficit raise substantial doubt about
our ability to continue as a going concern. We expect to incur losses in the
future and may not become profitable. If you purchase our common stock or other
securities, your investment may become worthless.

The report of our independent certified public accountant, Philip H. Salchli,
CPA, that covers our December 31, 2002 consolidated financial statements
contains a statement regarding our current losses from operations and the fact
that our total current liabilities exceed our total current assets, which raises
substantial doubt as to our ability to continue as a going concern. Our
consolidated financial statements do not include any adjustments that might
result from the outcome of that uncertainty. We will need to raise more money to
finance our operations. We may not be able to obtain additional financing at
all, or on acceptable terms. Any failure to raise additional financing will
likely place us in significant financial jeopardy, may disrupt our operations or
may force us to seek protection under the bankruptcy laws.

Despite the recent growth in our sales revenues, we cannot assure you that these
trends will continue or that we will ever become profitable. If we do not become
profitable, the value of our common stock and other securities may decline.

We have incurred significant losses since our inception. Our net loss for the
year ended December 31, 2002 was $2,615,518, and our accumulated deficit as of
December 31, 2002 was $2,489,083. We expect our operating losses to continue as
we engage in the development and expansion of our product lines.

We rely on sales from our key product, audio books, from which all of our
revenues were derived in the year ended December 31, 2002. Our product line is
not diversified. If we were to lose three or more of our major distributors, it
would have a material adverse effect on our revenues and operating results.

All of our revenues are derived from sales of our audio books. Our financial
performance remains dependent on this product. While we are not dependent on any
single distributor, if we were to lose three or more of these distributors it
would have a material adverse impact on our revenues and operating results.

We depend on certain key employees, the loss of whom could adversely affect our
business.


                                       15



We depend heavily upon the services of our executive officers, George Lovato,
Jr. and Don White. We do not have key person life insurance on the lives of
these individuals. While we may hire additional qualified individuals to work in
various capacities, the loss of the services of Mr. Lovato and Mr. White would
disrupt our operations and our business would be harmed.

In the event of their departure or a change in control, certain officers are
entitled to receive severance payments that could impede our ability to effect a
merger or other change in control.

Our employment agreements with Messrs. Lovato and White provide for severance
payments of $250,000 each in the event the agreements are terminated by our
company for each of Messrs. Lovato and White, and severance payments of $500,000
each in the event of, among other things, a change of control of our company,
including by a merger or asset sale. In light of our financial condition, these
agreements may preclude us from consummating a merger or similar transaction
with another entity or from effecting a change of control of our company.

Our market is highly competitive and we may not be able to compete successfully.
If we cannot compete successfully, our securities may become worthless.

The market in which we participate is highly competitive. We believe that
hundreds of companies produce and distribute products similar to ours. Important
competitive factors in this market include price, product quality and
performance, diversity of offerings, and customer service. Many of our
competitors possess greater financial resources, wider brand name recognition,
broader distribution networks and other resources and characteristics that may
give them a competitive advantage. We may not be able to compete successfully in
our market. If we cannot compete successfully in our market, our common stock or
other securities may become valueless.

We are dependent on intellectual property that we may not be able to adequately
protect. Additionally, third parties may allege that we infringe on their
intellectual property. If we were to become involved in litigation, it would be
costly and would divert management's attention from our business operations.
This could have an adverse effect on our business and on the value of our
securities.

We rely on copyright laws to protect our proprietary rights in our products.
However, we cannot assure you that these laws will be adequate to protect our
proprietary rights. In addition, our intellectual property may not be protected
outside the United States. Furthermore, although we believe that our
intellectual property rights do not infringe upon the proprietary rights of
third parties, a competitor may claim that we have infringed on its products.
Any litigation relating to our intellectual property could result in substantial
expense to us and result in significantly diverting our management personnel
from their routine activities. This could have an adverse effect on our business
and the value of our securities.


                                       16


                          Item 7. FINANCIAL STATEMENTS

                          INDEPENDENT AUDITOR'S REPORT

Board of Directors and Shareholders
Americana Publishing, Inc. and subsidiary
Albuquerque, New Mexico


I  have  audited  the  accompanying  consolidated  balance  sheet  of  Americana
Publishing,  Inc.  and  subsidiary,  as of  December  31,  2002 and the  related
consolidated  statements of operations,  and cash flows for the year then ended.
These financial  statements are the responsibility of the Company's  management.
My responsibility  is to express an opinion on these financial  statements based
on my audit.

I conducted the audit in accordance with auditing  standards  generally accepted
in the United States of America. Those standards require that I plan and perform
the audit to obtain reasonable  assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.  An
audit also includes  assessing the accounting  principles  used and  significant
estimates  made by  management,  as well as  evaluating  the  overall  financial
statement presentation.  I believe that my audit provides a reasonable basis for
my opinion.

In my opinion, the consolidated  financial statements referred to above presents
fairly,  in  all  material   respects,   the  financial  position  of  Americana
Publishing,  Inc and  subsidiary  as of December 31, 2002 and the results of its
operations  and its cash  flows  for the year  then  ended  in  conformity  with
accounting principles generally accepted in the United States of America.

The accompanying  consolidated  financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in Note 2 to the
financial statements, the Company has suffered recurring losses from operations,
and its  current  liabilities  exceed  its total  current  assets.  This  raises
substantial  doubt about the Company's  ability to continue as a going  concern.
Management's  plans in regard to these matters are also described in Note 2. The
consolidated  financial  statements  do not include any  adjustments  that might
result from the outcome of this uncertainty.


//Philip H. Salchli, CPA//
Houston, Texas
March 21, 2003


                                      F-1



                          INDEPENDENT AUDITOR'S REPORT


To the Board of Directors
Americana Publishing, Inc.
Albuquerque, New Mexico


We have  audited  the  accompanying  consolidated  balance  sheet  of  Americana
Publishing,  Inc.  and  subsidiary  as of  December  31,  2001,  and the related
consolidated statements of operations,  shareholder' equity (deficit),  and cash
flows for the year then ended. These financial statements are the responsibility
of the  Company's  management.  Our  responsibility  is to express an opinion on
these financial statements based on our audit.

We conducted our audit in accordance with auditing standards  generally accepted
in the  United  States of  America.  Those  standards  require  that we plan and
perform the audit to obtain  reasonable  assurance  about  whether the financial
statements are free of material misstatement.  An audit includes examining, on a
test basis,  evidence  supporting  the amounts and  disclosures in the financial
statements.  An audit also includes assessing the accounting principles used and
significant  estimates  made by  management,  as well as evaluating  the overall
financial  statement  presentation.   We  believe  that  our  audit  provides  a
reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly,  in  all  material   respects,   the  financial  position  of  Americana
Publishing,  Inc. and  subsidiary  as of December  31, 2001,  and the results of
their operations and their cash flows for the year then ended in conformity with
accounting principles generally accepted in the United States of America.

The accompanying  consolidated  financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in Note 2 to the
financial statements, the Company has suffered recurring losses from operations,
and its total current  liabilities exceed its total current assets.  This raises
substantial  doubt about the Company's  ability to continue as a going  concern.
Management's  plans in regard to these matters are also described in Note 2. The
consolidated  financial  statements  do not include any  adjustments  that might
result from the outcome of this uncertainty.


//SINGER LEWAK GREENBAUM & GOLDSTEIN LLP//

Los Angeles, California
March 31, 2002


                                      F-2



                     Americana Publishing, Inc. and Subsidiary
                           Consolidated Balance Sheet
                             As of December 31, 2002

ASSETS
                                                   Restated
Current Assets                                                     2002
                                                                -------------
    Cash and cash equivalents                                $        -
    Accounts Receivable, less allowance for doubtful
      accounts of $29,316                                       350,221
    Inventory                                                    69,246
    Prepaid and other current assets                              7,470
    Assets from discontinued operations                       1,519,430
                                                             ---------------

        Total Current Assets                                 $1,946,367

Property and Equipment, net                                     274,514
                                                             ---------------
TOTAL ASSETS                                                 $2,220,881
                                                             ===============
LIABILITIES AND SHAREHOLDER'S DEFICIT

Current Liabilities
    Accounts Payable                                         $  224,123
    Accrued expenses                                            316,562
    Notes payable - related parties                             125,546
    Convertible debt - related parties                          387,500
    Liabilities due to discontinued operations                3,686,233
                                                             -------------
       Total current liabilities                              4,739,964

Commitments and contingencies

Shareholder's deficit
    Preferred stock, no par
      20,000,000 shares authorized
      no shares issued and outstanding                                -
    Common stock, $0.001 par value
      100,000,000 shares authorized                                   -
       30,863,837 shares issued and outstanding                  30,863
       (35,268,295 shares held in trust)
    Additional Paid-In Capital                               10,315,726
    Accumulated deficit                                     (12,865,672)
                                                            -------------
        Total shareholder's deficit                          (2,519,083)
                                                            -------------

TOTAL LIABILITIES AND STOCKHOLDER'S DEFICT                  $ 2,220,881
                                                            =============



   The Accompanying Notes are an Integrated Part of these Financial Statements


                                      F-3



                    AMERICANA PUBLISHING, INC. AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                        For the Years Ended December 31,
                                                                    (Restated)
                                                                          2002               2001

Revenues                                                              $  640,848        $  259,680

Cost of goods sold                                                       103,520            62,045
                                                                      ----------        ----------
Gross profit                                                             537,328           197,635

Operating expenses
     Depreciation and amortization                                       102,351           132,735
     Selling, general, and administrative (including stock-
         based compensation of $1,266,641 and $1,889,334)              2,159,139         3,301,780
                                                                      ----------        ----------
         Total operating expenses                                      2,261,490         3,622,730
                                                                      ----------        ----------
Loss from operations                                                  (1,724,162)       (3,425,095)

Other income (expense)
     Interest expense                                                    (61,804)          (28,164)
     Financing expense related to
     convertible debt                                                          -          (385,000)
     Interest Income                                                           -               196
                                                                      ----------        ----------
         Total other income (expense)                                    (61,804)         (412,968)

Loss before discontinued operations                                   (1,785,966)       (3,838,063)

Loss from discontinued operations                                       (829,552)       (1,031,537)
Impairment of goodwill of discontinued operations                              -          (905,733)
                                                                      ----------        ----------
Net loss                                                              (2,615,518)      $(5,775,333)

Basic and diluted loss per share
     From continuing operations                                            (0.09)      $     (0.35)
     From discontinued operations                                          (0.04)            (0.17)
                                                                      ----------        ----------
         Total                                                             (0.13)      $     (0.52)
                                                                      ==========        ==========
Basic and diluted weighted-average shares outstanding                 19,603,657        11,159,259
                                                                      ==========        ==========




   The accompanying notes are an integral part of these financial statements.


                                      F-4




                   AMERICANA PUBLISHING, INC. AND SUBSIDIARY
            CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (DEFICIT)
                        For the Years Ended December 31,


                                                                     Additional
                                       Common Stock                    Paid-in           Retained
                                  Shares              Amount           Capital           Earnings           Total (Restated)
Balance, December
   31, 2000                        7,822,396             7,822         5,122,225   (4,474,822)              655,225
Issuance of common
   stock in exchange
   for cash                          837,647               838           174,162                            175,000
Issuance of common
   stock in exchange
   for book rights                    10,000                10             1,490                              1,500
Issuance of common
   stock for acquisition
   of CMG                       1,017,827         1,018            406,113                            407,131

Issuance of common
   stock to outside
   consultants in
   exchange for
   services
   rendered                        1,331,500   $         1,332  $        429,383  $                $        430,715
Issuance of common
   stock to
   employees and
   members of the
   Board of Directors
   for services
   rendered                        3,659,200             3,659         1,459,951                          1,463,610
Compensation
   expense to
   members of the
   Board of Directors
   relating to stock
   options granted
   below the fair
   market value                                                          461,250                            461,250
Compensation
   expense to
   non-employees
   relating to stock
   options granted
   below the fair
   market value                                                          294,196                            294,196
Financing expense
   relating to beneficial
   conversion feature                                                    385,000                            385,000
Cancellation of
   common stock
   issued to
   employees                         (42,000)              (42)          (41,958)                           (42,000)
Net loss                                                                               (5,775,333)       (5,775,333)
Balance, December
   31, 2001                       14,636,570   $        14,637  $      8,691,812  $   (10,250,155) $     (1,543,706)
Issuance of common
   stock in exchange
   for cash                        2,011,666             2,011           303,988                             306.000
Issuance of common
   stock in exchange
   for inventory                     250,000               250            67,250                              67,500
Issuance of common
   stock to outside
   consultants in
   exchange for
   services
   rendered                       10,888,601   $        10,888  $        981,167                             992,055
Issuance of common
   stock to employees
   and members of the
   Board of Directors
   for services
   rendered                       3,077,000              3,077           271,509                             274,586
Net Loss                                                                               (2,615,517)        (2,615,517)
Balance, December
   31, 2002                      30,863,837             30,863        10,315,726      (12,865,672)        (2,519,082)


                                      F-5



                    AMERICANA PUBLISHING, INC. AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                        For the Years Ended December 31,

                                                        (Restated)
                                                                                      2002               2001
Cash flows from operating activities
   Net loss from continuing operations                                            $(1,785,966)      $    (3,838,063)
   Adjustments to reconcile net loss to net cash
     used in operating activities
       Depreciation and amortization                                                  102,352               132,735
       Allowance for doubtful accounts                                                 26,816                     -
       Issuance of common stock to outside consultants
         in exchange for services rendered                                            992,055               430,715
       Issuance of common stock to employees and
         members of the Board of Directors in exchange
         for services rendered                                                        274,586             1,463,610
       Compensation expense to members of the
        Board of Directors relating to stock
        options granted below the fair market
        value                                                                                               461,250
       Compensation expense to non-employees
        for stock options issued below the
        fair market value                                                                                   294,196
       Cancellation of common stock issued to
        employees                                                                                           (42,000)
       Impairment of audio production costs                                                                 188,215

       Financing expense related to convertible debt                                                        385,000
       (Increase) decrease in
         Accounts receivable                                                         (307,126)               15,848
         Inventory                                                                    (48,886)                   33
         Prepaid and other current assets                                              (1,736)               51,262
         Audio production costs                                                                             (30,071)
       Increase in
         Factor payable                                                                62,975
         Accounts payable                                                             186,133                 8,790
         Accrued expenses                                                              94,241                 5,217
                                                                                   -----------             ---------
Net cash used in continuing operating activities                                     (404,556)             (473,263)
                                                                                   -----------             ---------
Net cash used in operating activities                                                (404,556)             (815,874)

Cash flows from investing activities
   Proceeds from sale of marketable securities                                              -                     -
   Proceeds from certificate of deposit                                                     -                30,000
   Purchase of property and equipment                                                 (28,981)              (11,734)

Net cash provided by (used in) continuing investing activities                        (28,981)               18,266
Net cash provided by discontinued investing activities                                      -                     -

Net cash provided by (used in) investing activities                                   (28,981)               18,266

Cash flows from financing activities
   Proceeds from notes payable                                                    $   125,545       $       387,500
   Proceeds from sale of common stock                                                 306,000               175,000

Net cash provided by continuing financing activities                                  431,545               562,500
Net cash used in discontinued financing activities                                          -               (59,994)

Net cash provided by financing activities                                             431,545               502,506

Net decrease in cash and cash equivalents                                              (1,992)             (295,102)

Cash and cash equivalents, beginning of year                                            1,992                20,027

Cash and cash equivalents, end of year                                            $         -       $         1,992


Supplemental disclosures of cash flow information

   Interest paid - continuing operations                                               61,805       $        25,164

   Interest paid - discontinued operations                                                  -       $       110,832

   Income taxes paid                                                                        -       $             -


Supplemental schedule of non-cash investing and financing activities

During the year ended December 31, 2002, the Company  received  inventory valued
at $16,875  and masters of audio  books  valued at $50,625 in  exchange  for the
issuance of 250,000 shares of common stock.


                                      F-6




                    AMERICANA PUBLISHING, INC. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2002


NOTE 1 - ORGANIZATION AND LINE OF BUSINESS

         General
          Americana  Publishing,  Inc.  ("API")  was  organized  as  a  Colorado
          corporation on April 17, 1997.  Americana  Publishing,  Inc. publishes
          books.

         Corporate Media Group, Inc.
          On July 15,  2001,  API acquired  certain  assets and  liabilities  of
          Corporate Media Group, Inc. ("CMG").  The purchase price was $407,131,
          which was paid by issuing  1,017,827 shares of API's common stock. CMG
          recorded  $905,733  in excess of cost  over fair  value of net  assets
          acquired, identified as goodwill. The acquisition was accounted for by
          the  purchase  method.  On December 31, 2001,  it was  determined  the
          goodwill  was  impaired;  therefore,  the full amount of goodwill  was
          written off,  which is included in the statement of operations in loss
          from discontinued operations for the year ended December 31, 2001.

          For financial statement purposes,  the acquisition  occurred on August
          1, 2001. The assets acquired were as follows:

                  Cash                                  $       277,067
                  Accounts receivable                           259,570
                  Inventory                                     371,961
                  Income tax receivable                         249,300
                  Property and equipment                      1,827,541
                  Liabilities assumed                        (3,484,041)
                  Excess of cost over fair value                905,733

                      Total                             $       407,131

          CMG  provides  an  array  of  services,   including  audio  and  video
          duplication,   packaging,  fulfillment,  storage,  and  marketing,  to
          various customers throughout the nation.

          During the nine months ended  September 30, 2002,  the Company  ceased
          operations of CMG. CMG will most likely file Chapter 7 bankruptcy.  In
          addition,  the Company is involved in a lawsuit  with the former owner
          of CMG.


                                      F-7



NOTE 1 - ORGANIZATION AND LINE OF BUSINESS (Continued)

         Corporate Media Group, Inc. (Continued)
          As  of  December  31,  2002,  the  net   liabilities  on  discontinued
          operations were as follows:

                  Cash                                  $         -
                  Accounts receivable                             -
                  Accounts receivable - factored                  -
                  Inventory                                       -
                  Property and equipment, net             1,507,059
                  Miscellaneous Receivables                  12,371
                                                        -----------
                      Total assets                        1,519,430

                  Book overdraft                              5,507
                  Line of credit                            201,248
                  Accounts payable                        2,714,673
                  Accrued expenses                          112,844
                  Note payable - factored                   138,375
                  Note payable - related party               83,397
                  Capital lease obligations                 430,189
                                                         ----------
                      Total liabilities                   3,686,233

        Net liabilities due to discontinued operations   (2,166,803)
                                                         ==========

          The operating results of the discontinued subsidiary are summarized as
          follows for the year ended December 31,
                                                   2002                         2001
                  Revenues                              $     786,398          2,191,291
                  Cost of goods sold                          700,846            1,919,053
                                                        -------------
                  Gross profit                                 85,552                   272,238
                                                        -------------
                  Operating expenses
                     Compensation                             215,651              490,666
                      Depreciation and amortization           141,094       118,059
                      Selling, general, and administrative    558,360      543,260
                                                        -------------
                           Total operating expenses           915,105        1,151,985



                  Loss from operations                       (829,553)         (879,747)


NOTE 2 - GOING CONCERN

The accompanying financial statements have been prepared on a going concern
basis, which contemplates the realization of assets and the satisfaction of
liabilities in the normal course of business. As shown in the financial
statements, during the years ended December 31, 2002 and 2001, the Company (as
defined in Note 3) incurred losses of $2,615,518 and $5,775,333, respectively.
In addition, as of December 31, 2002, its total current liabilities exceeded its
total current assets by $2,793,597, and its shareholders' deficit was
$2,519,083. These factors, among others, raise substantial doubt about its
ability to continue as a going concern.

The Company's attainment of profitable operations is dependent upon the Company
obtaining adequate debt or equity financing and achieving a level of sales
adequate to support its operations. The Company plans to engage the services of
a broker to assist it with capital raising. . In order to increase sales, the
Company intends to continue to license authored works and to seek compatible
products or businesses that it may be able to acquire. Because its cash
resources are limited, the Company anticipates that acquisitions must be made
with its common stock. Due to the low per-share price of, and the sporadic
trading market for, its common stock, the Company may be unsuccessful in making
any acquisitions. If the Company is unable to find debt or equity financing or
to increase its sales to an amount that can support its operations, it may never
be profitable. The Company does not anticipate being able to generate sufficient
cash flow to support our operations during the next 12 months.




NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

          Principles of Consolidation
          The consolidated  financial statements include the accounts of API and
          its wholly owned subsidiary,  CMG (collectively,  the "Company").  All
          significant  inter-company accounts and transactions are eliminated in
          consolidation.


                                      F-8


NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

         Development Stage Enterprise
          During the year ended  December 31, 2001,  the Company  ceased to be a
          development  stage  company  as  defined  in  Statement  of  Financial
          Accounting  Standards  ("SFAS") No. 7,  "Accounting  and  Reporting by
          Development  Stage   Enterprises."  The  Company's  planned  principal
          operations  have  commenced,  and there have been  revenues from those
          operations.

         Revenue Recognition
          Revenue  from sales of  services  is  recognized  when the  service is
          performed  and  billable.   Revenue  from  the  sale  of  products  is
          recognized when the products are shipped.

         Comprehensive Income
          The Company utilizes SFAS No. 130, "Reporting  Comprehensive  Income."
          This  statement  establishes  standards  for  reporting  comprehensive
          income and its  components  in a  financial  statement.  Comprehensive
          income as defined includes all changes in equity (net assets) during a
          period  from  non-owner  sources.  Examples of items to be included in
          comprehensive  income,  which are  excluded  from net income,  include
          foreign currency  translation  adjustments,  minimum pension liability
          adjustments,  and  unrealized  gains and losses on  available-for-sale
          securities.  Comprehensive  income is not  presented in the  Company's
          financial  statements  since the Company did not have any of the items
          of comprehensive income in any period presented.

         Cash and Cash Equivalents
          For the purpose of the statements of cash flows, the Company considers
          all highly liquid  investments  purchased with original  maturities of
          three months or less to be cash equivalents.

         Inventory
          Inventory, consisting principally of videocassettes,  is valued at the
          lower of cost (first-in, first-out) or market.

         Property and Equipment
          Property  and   equipment  are  stated  at  cost,   less   accumulated
          depreciation  and  amortization.  During the year ended  December  31,
          2000, a portion of the property and equipment was  contributed  to the
          Company by the Company's Chairman/majority shareholder in exchange for
          common stock.  This contributed  property and equipment are carried at
          the contributor's cost basis.


                                      F-9


NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

         Property and Equipment (Continued)
          Depreciation  and  amortization  are provided using the  straight-line
          method over estimated useful lives as follows:

                              Continuing Operations

                  Database and circulation list                                           5 years
                  Computer equipment                                                      5 years
                  Office furniture and fixtures                                        5 -7 years
                  Web site development                                                    5 years
                  Leasehold improvements                                 estimated useful life or
                                                                 lease term, whichever is shorter

                             Discontinued Operations

                  Production equipment                                                    7 years
                  Vehicles                                                                5 years
                  Office furniture and fixtures                                        5 -7 years
                  Assets under capital leases                                         3 - 6 years
                  Leasehold improvements                                 estimated useful life or
                                                                 lease term, whichever is shorter

         Fair Value of Financial Instruments
          The  Company   measures  its  financial   assets  and  liabilities  in
          accordance with generally accepted accounting principles.  For certain
          of the  Company's  financial  instruments,  including  cash  and  cash
          equivalents,   accounts  receivable,  accounts  payable,  and  accrued
          expenses,  the carrying  amounts  approximate  fair value due to their
          short maturities. The amounts shown for line of credit, note payable -
          factor,  notes payable - related  parties,  convertible debt - related
          parties,  and capital lease  obligations  also  approximate fair value
          because  current  interest  rates  offered to the  Company for debt of
          similar maturities are substantially the same.

         Stock-Based Compensation
          SFAS No. 123,  "Accounting  for Stock-Based  Compensation,"  defines a
          fair value based method of accounting  for  stock-based  compensation.
          However,  SFAS No.  123  allows  an  entity  to  continue  to  measure
          compensation  cost  related  to stock  and  stock  options  issued  to
          employees  using the  intrinsic  method of  accounting  prescribed  by
          Accounting  Principles  Board ("APB") Opinion No. 25,  "Accounting for
          Stock  Issued to  Employees."  Entities  electing  to remain  with the
          accounting method of APB No. 25 must make pro forma disclosures of net
          loss and loss per  share as if the fair  value  method  of  accounting
          defined in SFAS No. 123 had been  applied.  The Company has elected to
          account for its  stock-based  compensation  to employees under APB No.
          25.


                                      F-10


NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

         Advertising Expense
          The  Company  expenses  advertising  in the  period  the  service  was
          incurred.  For the year ended December 31, 2002,  advertising  expense
          for   continuing   operations   and   discontinued    operations   was
          approximately  $2,675  and $253,  respectively.  For the  years  ended
          December 31, 2001,  advertising expense for continuing  operations and
          discontinued   operations  was  approximately   $24,000  and  $58,000,
          respectively.

         Income Taxes
          The Company  utilizes  SFAS No. 109,  "Accounting  for Income  Taxes,"
          which requires the  recognition of deferred tax assets and liabilities
          for the  expected  future tax  consequences  of events  that have been
          included  in the  financial  statements  or tax  returns.  Under  this
          method,  deferred income taxes are recognized for the tax consequences
          in future  years of  differences  between  the tax bases of assets and
          liabilities and their financial  reporting  amounts at each period end
          based on enacted tax laws and  statutory  tax rates  applicable to the
          periods  in which the  differences  are  expected  to  affect  taxable
          income.  Valuation  allowances are  established,  when  necessary,  to
          reduce deferred tax assets to the amount expected to be realized.

         Loss Per Share
          The Company  utilizes  SFAS No. 128,  "Earnings per Share." Basic loss
          per  share  is  computed  by  dividing   loss   available   to  common
          shareholders   by  the   weighted-average   number  of  common  shares
          outstanding.  Diluted loss per share is computed similar to basic loss
          per share  except that the  denominator  is  increased  to include the
          number of additional common shares that would have been outstanding if
          the  potential  common  shares had been  issued and if the  additional
          common shares were  dilutive.  Common  equivalent  shares are excluded
          from the  computation  if their effect is  anti-dilutive.  Because the
          Company has incurred net losses,  basic and diluted loss per share are
          the same.

          The  following  potential  common  shares have been  excluded from the
          computation  of diluted net loss per share for the year ended December
          31, 2002 because the effect would have been anti-dilutive:

                  Stock options outstanding                3,000,000
                  Convertible debt                        35,268,295

                      Total                               38,268,295
                                                          ===========
         Estimates
          The preparation of financial  statements  requires  management to make
          estimates and assumptions  that affect the reported  amounts of assets
          and liabilities and disclosure of contingent assets and liabilities at
          the date of the  financial  statements  and the  reported  amounts  of
          revenue and expenses during the reporting period. Actual results could
          differ from those estimates.


                                      F-11


NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

         Concentrations of Risk
          During the year ended  December 31, 2002, the Company had net sales to
          five major customers that  represented  17%, 15%, 9%, 4% and 4% of net
          sales.


         Recently Issued Accounting Pronouncements
          In June 2001, the Financial Accounting Standards Board ("FASB") issued
          SFAS  No.  141,  "Business  Combinations."  This  statement  addresses
          financial  accounting  and  reporting  for business  combinations  and
          supersedes APB Opinion No. 16, "Business  Combinations,"  and SFAS No.
          38,  "Accounting  for   Pre-Acquisition   Contingencies  of  Purchased
          Enterprises." All business combinations in the scope of this statement
          are to be accounted  for using one method,  the purchase  method.  The
          provisions  of  this  statement  apply  to all  business  combinations
          initiated after June 30, 2001. Use of the pooling-of-interests  method
          for those business  combinations  is  prohibited.  This statement also
          applies to all business combinations  accounted for using the purchase
          method for which the date of acquisition is July 1, 2001 or later. The
          Company  does not expect  adoption  of SFAS No. 141 to have a material
          impact, if any, on its financial position or results of operations.

          In June  2001,  the FASB  issued  SFAS No.  142,  "Goodwill  and Other
          Intangible Assets." This statement addresses financial  accounting and
          reporting  for  acquired  goodwill  and other  intangible  assets  and
          supersedes APB Opinion No. 17,  "Intangible  Assets." It addresses how
          intangible  assets that are acquired  individually  or with a group of
          other assets (but not those acquired in a business combination) should
          be accounted for in financial statements upon their acquisition.  This
          statement  also  addresses  how goodwill and other  intangible  assets
          should be accounted for after they have been  initially  recognized in
          the financial  statements.  It is effective for fiscal years beginning
          after December 15, 2001.  Early  application is permitted for entities
          with fiscal years  beginning  after March 15, 2001,  provided that the
          first interim  financial  statements have not been issued  previously.
          The  Company  does  not  expect  adoption  of SFAS  No.  142 to have a
          material  impact,  if any,  on its  financial  position  or results of
          operations.

          In June 2001,  the FASB  issued SFAS No.  143,  "Accounting  for Asset
          Retirement  Obligations."  This statement applies to legal obligations
          associated  with the retirement of long-lived  assets that result from
          the  acquisition,   construction,   development,   and/or  the  normal
          operation of  long-lived  assets,  except for certain  obligations  of
          lessees. This statement is not applicable to the Company.


                                      F-12


NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

         Recently Issued Accounting Pronouncements (Continued)
          In August  2001,  the FASB issued SFAS No.  144,  "Accounting  for the
          Impairment or Disposal of Long-Lived Assets." This statement addresses
          financial  accounting  and reporting for the impairment or disposal of
          long-lived assets.  This statement replaces SFAS No. 121,  "Accounting
          for the Impairment of Long-Lived  Assets and for Long-Lived  Assets to
          be Disposed of," the  accounting  and reporting  provisions of APB No.
          30,  "Reporting  the Results of  Operations - Reporting the Effects of
          Disposal of a Segment of a Business,  and Extraordinary,  Unusual, and
          Infrequently Occurring Events and Transactions," for the disposal of a
          segment of a business, and amends Accounting Research Bulletin No. 51,
          "Financial  Statements,"  to eliminate the exception to  consolidation
          for a  subsidiary  for which  control is likely to be  temporary.  The
          Company  does not expect  adoption  of SFAS No. 144 to have a material
          impact, if any, on its financial position or results of operations.

          In April of 2002,  the FASB issued SFAS No. 145,  "Rescission  of FASB
          Statements No. 4, 44, and 64,  Amendments of FASB statement No. 13 and
          Technical  Corrections." This Statement rescinds FSAB Statement No. 4,
          Reporting  Gains  and  Losses  from  Extinguishment  of  Debt,  and an
          amendment of that Statement, FASB Statement No. 64, Extinguishments of
          Debt Made to Satisfy  Sinking-Fund  Requirements.  This Statement also
          rescinds FSAB Statement No. 44,  Accounting  for Intangible  Assets or
          Motor  Carriers.   This  Statement   amends  FASB  Statement  No.  13,
          Accounting  for Leases,  to  eliminate  an  inconsistency  between the
          required  accounting for sale-leaseback  transactions and the required
          accounting for certain lease  modifications that have economic effects
          that are similar to sale-leaseback  transactions.  This Statement also
          amends other  existing  authoritative  pronouncements  to make various
          technical   corrections,   clarify   meanings,   or   describe   their
          applicability  under changed  conditions.  The Company does not expect
          adoption  of SFAS No. 145 to have a material  impact,  if any,  on its
          financial position or results of operation.

          In August of 2002, the FASB issues SFAS No. 146, "Accounting for Costs
          Associated with Exit or Disposal Activities". This Statement addresses
          financial  accounting and reporting for costs  associated with exit or
          disposal  activities and nullifies  Emerging  Issues Task Force (EITF)
          Issue  No.  94-3,   "Liability   Recognition   for  Certain   Employee
          Termination  Benefits  and other Costs to Exit an Activity  (Including
          Certain  Costs  Incurred in a  Restructuring)."  The Company  does not
          expect adoption of SFAS No. 146 to have a material impact,  if any, on
          its financial position or results of operation.

          In October of 2002,  the FASB issued SFAS No.  147,  "Acquisitions  of
          Certain Financial Institutions - an Amendment of FASB Statement No. 72
          and 144 and  FASB  Interpretation  No.  9".  Except  for  transactions
          between  two  or  more  mutual  enterprises,  this  Statement  removes
          acquisitions  of  financial  institutions  from  the  scope  of  both
          Statement 72 and Interpretation 9 and requires that those transactions
          be accounted for in accordance with FASB Statements No. 141,  Business
          Combinations, and No. 142, Goodwill and Other Intangible Assets. Thus,
          the  requirement  in paragraph 5 of  Statement  72 to  recognize  (and
          subsequent  amortize)  any  excess  of the fair  value of  liabilities
          assumed  over the fair value of tangible and  identifiable  intangible
          assets  acquired  as an  unidentifiable  intangible  asset  no  longer
          applies  to  acquisitions  within  the  scope  of this  Statement.  In
          addition, this Statement amends FASB Statement No. 147, Accounting for
          the  Impairment  or Disposal of Long-Lived  Assets,  to include in its
          scope long-term  customer-relationship  intangible assets of financial
          institutions such as depositor- and borrower-relationship  intangible
          assets and credit cardholder  intangible assets.  Consequently,  those
          intangible  assets  are  subject  to the same  undiscounted  cash flow
          recoverability  test and impairment  loss  recognition and measurement
          provisions the Statement 144 requires for other long-lived assets that
          are held and used.  The Company  does not expect  adoption of SFAS No.
          147 to have a material  impact,  if any, on its financial  position or
          results of operation.


                                      F-13


          In December of 2002,  the FASB  issued  SFAS No. 148,  "Accounting  for
          Stock Based  Compensation-Transition  and Disclosure - an amendment of
          FASB Statement No. 123". This Statement amends FASB Statement No. 123,
          Accounting  for  Stock-Based  Compensation,   to  provide  alternative
          methods of transition  for a voluntary  change to the fair value based
          method  of  accounting  for  stock-based  employee  compensation.   In
          addition,   this  Statement  amends  the  disclosure  requirements  of
          Statement  123 to require  prominent  disclosures  in both  annual and
          interim  financial  statements  about  the  method of  accounting  for
          stock-based employee compensation and the effect of the method used on
          reported results. The Company does not expect adoption of SFAS No. 148
          to have a  material  impact,  if any,  on its  financial  position  or
          results of operation.

          The Company has adopted  only the  disclosure  provisions  of SFAS No.
          123. It applies APB No. 25 and related  interpretations  in accounting
          for its  plans and does not  recognize  compensation  expense  for its
          stock-based  compensation  plans other than for  restricted  stock and
          options issued to outside third parties. If the Company had elected to
          recognize  compensation expense based upon the fair value at the grant
          date for awards  under these  plans  consistent  with the  methodology
          prescribed  by SFAS 123,  the  Company's  net loss and basic  loss per
          share for the  years  ended  December  31,  2002 and 2001  would be as
          follows:

                                                                  2001               2002
                  Net loss
                      As reported                         $    (5,775,333)   $     (2,238,437)
                      Pro forma                           $    (6,040,104)   $     (2,328,437)
                  Basic loss per common share
                      As reported                         $         (0.52)   $          (0.41)
                      Pro forma                           $         (0.54)   $          (0.42)

          For purposes of computing the pro forma  disclosures  required by SFAS
          No.  123,  the fair  value of each  option  granted to  employees  and
          directors is estimated using the  Black-Scholes  option-pricing  model
          with the following  weighted-average  assumptions  for the years ended
          December   31,  2001  and  2002:   dividend   yields  of  0%  and  0%,
          respectively;  expected  volatility  of 175%  and  N/A,  respectively;
          risk-free interest rates of 3.6% and 4.6%, respectively;  and expected
          lives of two and three years, respectively.  The weighted-average fair
          value of options  granted  during the year ended December 31, 2001 for
          which the  exercise  price was  greater  than the market  price on the
          grant  date was $0.34,  and the  weighted-average  exercise  price was
          $0.50. The  weighted-average  fair value of options granted during the
          year ended  December  31, 2001 for which the  exercise  price was less
          than  the  market  price  on  the  grant  date  was  $0.46,   and  the
          weighted-average exercise price was $0.05.

          The  Black-Scholes  option  valuation  model was  developed for use in
          estimating  the fair  value of traded  options  which  have no vesting
          restrictions and are fully transferable. In addition, option valuation
          models require the input of highly  subjective  assumptions  including
          the expected stock price  volatility.  Because the Company's  employee
          stock options have characteristics  significantly different from those
          of  traded  options,  and  because  changes  in the  subjective  input
          assumptions  can  materially  affect  the  fair  value  estimate,   in
          management's opinion, the existing models do not necessarily provide a
          reliable  single  measure  of the  fair  value of its  employee  stock
          options.

          In the  event of a merger,  sale of the  Company,  a hostile  takeover
          attempt,  or  other  sales  of the  Company's  assets,  each  director
          previously  granted  options will have the option to purchase  300,000
          additional shares of common stock at $1 per share.

          Stock Option Plan
          In June  2000,  the Board of  Directors  approved  the  adoption  of a
          non-qualified and incentive stock option plan, the 2000 Stock Purchase
          and  Option  Plan  (the  "Plan").  The  Plan is  intended  to  provide
          incentive to key employees,  officers,  and consultants of the Company
          who provide significant  services to the Company.  There are 5,000,000
          options  available for grant under the Plan.  Options will vest over a
          period of time as  determined  by the Board of Directors  for up to 10
          years from the date of grant. The Plan expires on June 30, 2010.

          The  exercise  price  of  options  granted  under  the  Plan  will  be
          determined by the Board of Directors, provided that the exercise price
          will  not be less  than 85% of the  fair  market  value on the date of
          grant. In addition, if the option is granted to an officer or director
          of the Company,  the exercise  price will not be less than 100% of the
          fair market value on the date of grant.  Furthermore,  incentive stock
          options may not be granted to a 10%  shareholder,  unless the exercise
          price is 100% of the fair market value on the date of grant.

A summary of the Company's outstanding options and activity is as follows:
                                                                                     Weighted-
                                                                                      Average
                                                                     Number          Exercise
                                                                  of Options           Price

                  Outstanding, December 31, 2000                 2,153,000           $  0.20
                      Granted                                    2,375,000           $  0.23
                      Cancelled                                 (2,103,000)          $  0.20
                                                                ----------

                           Outstanding, December 31, 2001        2,425,000        $     0.24
                                                                ==========

                           Exercisable, December 31, 2001        2,425,000        $     0.24
                                                                ==========

                 Outstanding, December 31, 2001                  2,425,000           $  0.24
                      Granted                                            0
                      Forfeited                                     75,000
                                                                ----------
                           Outstanding, December 31, 2002        2,350,000           $  0.24
                                                                ==========

                           Exercisable, December 31, 2002        2,350,000           $  0.24
                                                                ==========

The weighted-average remaining contractual life of the options outstanding at
December 31, 2002 is 1.00 years. The exercise prices for the options outstanding
at December 31, 2002 ranged from $0.05 to $0.50, and information relating to
these options is as follows:

                                                                                    Weighted-        Weighted-
                                                                  Weighted-          Average          Average
                                                                   Average           Exercise         Exercise
             Range of              Stock             Stock       Remaining           Price of         Price of
             Exercise            Options           Options       Contractual         Options           Options
               Prices        Outstanding        Exercisable            Life       Outstanding       Exercisable

         $             0.05          200,000           200,000        1.00 years  $          0.05  $           0.05
         $      0.17 - 0.20          600,000           600,000        1.00 years  $          0.17  $           0.17
         $             0.50        2,200,000         2,200,000        1.00 years  $          0.50  $           0.50
                                   ---------         ---------
                                   3,000,000         3,000,000
                                   =========         =========

The Company has adopted only the disclosure provisions of SFAS No. 123. It
applies APB No. 25 and related interpretations in accounting for its plans and
does not recognize compensation expense for its stock-based compensation plans
other than for restricted stock and options issued to outside third parties. If
the Company had elected to recognize compensation expense based upon the fair
value at the grant date for awards under these plans consistent with the
methodology prescribed by SFAS 123, the Company's net loss and basic loss per
share for the years ended December 31, 2002 and 2001 would be as follows:

                                                                  2001               2002
                  Net loss
                      As reported                         $    (5,775,333)   $     (2,238,437)
                      Pro forma                           $    (6,040,104)   $     (2,328,437)
                  Basic loss per common share
                      As reported                         $         (0.52)   $          (0.41)
                      Pro forma                           $         (0.54)   $          (0.42)

For purposes of computing the pro forma disclosures required by SFAS No. 123,
the fair value of each option granted to employees and directors is estimated
using the Black-Scholes option-pricing model with the following weighted-average
assumptions for the years ended December 31, 2001 and 2002: dividend yields of
0% and 0%, respectively; expected volatility of 175% and N/A, respectively;
risk-free interest rates of 3.6% and 4.6%, respectively; and expected lives of
two and three years, respectively. The weighted-average fair value of options
granted during the year ended December 31, 2001 for which the exercise price was
greater than the market price on the grant date was $0.34, and the
weighted-average exercise price was $0.50. The weighted-average fair value of
options granted during the year ended December 31, 2001 for which the exercise
price was less than the market price on the grant date was $0.46, and the
weighted-average exercise price was $0.05.

The Black-Scholes option valuation model was developed for use in estimating the
fair value of traded options which have no vesting restrictions and are fully
transferable. In addition, option valuation models require the input of highly
subjective assumptions including the expected stock price volatility. Because
the Company's employee stock options have characteristics significantly
different from those of traded options, and because changes in the subjective
input assumptions can materially affect the fair value estimate, in management's
opinion, the existing models do not necessarily provide a reliable single
measure of the fair value of its employee stock options.

In the event of a merger, sale of the Company, a hostile takeover attempt, or
other sales of the Company's assets, each director previously granted options
will have the option to purchase 300,000 additional shares of common stock at $1
per share.

                                      F-14


NOTE 4 - PROPERTY AND EQUIPMENT

         Property and equipment at December 31, 2002 consisted of the following:

                  Continuing Operations

                  Audio Production Cost                              267,820
                  Database and circulation list                      239,314
                  Computer equipment                                 130,722
                  Office furniture and fixtures                       71,073
                  Web site development                                44,663
                  Leasehold improvements                               5,299
                  Other                                               31,324
                                                                     -------
                                                                     790,215

                  Less accumulated depreciation and amortization     515,705
                                                                     -------
                      Total                                       274,510
                                                                     =======

          Depreciation  and amortization  expense for continuing  operations was
          $102,351  and $132,735 for the years ended  December 31, 2002 and 2001,
          respectively.

          Discontinued Operations

                  Office furniture and fixtures                   2,269,984
                  Leasehold improvements                            758,036
                                                                 ----------
                                                                  3,028,020

                  Less accumulated depreciation and amortization (1,520,961)
                                                                 ----------
                      Total                                    1,507,059
                                                                 ==========

          Depreciation and amortization expense for discontinued  operations was
          $141,094 and $118,059 for the years ended  December 31, 2002 and 2001,
          respectively.


NOTE 5 - NOTES PAYABLE - RELATED PARTIES - DISCONTINUED OPERATIONS

At December 31, 2002, the Company maintained notes payable to certain officers
of the Company, which are payable upon demand and are non-interest-bearing. As
of December 31, 2002, the amounts due aggregated to $48,751.

NOTE 6 - IMPAIRMENT TO AUDIO PRODUCTION COSTS

In 2001 the Company recognized a charge in the amount of $188,215 for impairment
to audio production costs. The Company determined that the future cash flows
associated with its audio production costs, which are made up of studio time and
voice talent, would be less than the audio production costs. The Company pays
approximately $500 per hour for voice talent and $1,500 per hour for studio
time. The impairment charge was made up of approximately $30,114 in charges for
voice talent and $158,101 in charges for studio time.

NOTE 7 - CONVERTIBLE DEBT - RELATED PARTIES

The Company issued convertible debt, as summarized below, payable to various
individuals, which is convertible at the option of the holder into the Company's
common stock. Interest at 30% per annum is payable on a monthly basis. If the
note holders elect to convert their debt into common stock, the conversion
prices range from $0.05 to $0.10 per share. There were not any conversions to
common stock during the year ended December 31, 2002.

The Company has failed to pay any of the convertible debt in accordance with the
terms. If they choose to do so, the holders of the promissory notes could
declare the loans in default and foreclose on the collateral. The note holders
could also file legal actions against the Company. If that were to happen, it
would divert management's attention from the business and require the Company to
incur legal fees and expenses to defend the actions. If the Company were
unsuccessful in its defense actions, in addition to the payment of the principal
and interest and its legal fees and expenses, the Company would be responsible
for paying the note holders' collection costs and attorney's fees. Attempts at
collection of these debts could effect the Company's ability to continue its
operations.



                                      F-15


NOTE 7 - CONVERTIBLE DEBT - RELATED PARTIES (Continued)

The terms  associated  with each  series for the year ended  December  31 are as
follows:

                  30% notes dated September 13, 2001 and September 27, 2001 in the amounts of $100,000 and $50,000, respectively, due
                      September 2002, convertible at $0.05 per share,
                      and secured by 750,000 shares of restricted common stock                     $        150,000
                  30% note dated October 2001, due October 2002, convertible at $0.05 per share,
                      and secured by 500,000 shares of restricted common stock                              100,000
                  30% notes dated November 21, 2001 and November 2002, respectively,, due November 2002, convertible at $0.05 per
                      share,
                      and secured by 500,000 shares of restricted common stock                              102,500
                  30% note dated December 6, 2001, due December 2002, convertible at $0.05 per share,
                      and secured by 125,000 shares of restricted common stock                               25,000
                  30% note dated December 6, 2001, due December 2002, convertible at $0.10 per share,
                      and secured by 300,000 shares of restricted common stock                               10,000

                           Total                                                                   $        387,500
                                                                                                   ================

In accordance with generally accepted accounting principles, the discount on the
conversion feature of the above notes is considered to be interest expense and
is recognized in the statement of operations during the period from the issuance
of the debt to the time at which the debt becomes convertible. The Company
recorded a conversion feature of $385,000. Since the debt was immediately
convertible, the $385,000 was recognized in the s0atement of operations during
the year ended December 31, 2001.

NOTE 8      CONVERTIBLE DEBT

On April 1, 2002 the Company entered into a financing transaction whereby it
issued 12% senior secured convertible debentures, with Class A Warrants and
Class B Warrants attached. The debentures were payable quarterly in cash or in
shares of the Company's common stock, at the discretion of the holders. If the
holders elected to receive interest in the form of common stock, the number of
shares of common stock to be received was to be based on the amount of the
interest payment, including penalty interest, if any, divided by the conversion
price, which was $0.0615, based on a closing date of April 1, 2002. In the event
the Company failed to pay any quarterly interest payment on the date such
payment was due, the interest payable on the principal amount of the debentures
and on all accrued and unpaid interest would increase to 18%, or the penalty
interest rate, until all accrued interest, including penalty interest, was paid
in full. The note holders had the right to immediately convert the debentures
into shares of the Company's common stock. The conversion price for the
debentures was equal to 50% of the lesser of the average of the three lowest
closing bid prices per share for the Company's common stock, as reported on the
over-the-counter electronic bulletin board, or such other public market that the
Company's common stock was then traded on, during either the 30 trading days
prior to the closing, or the 30 trading days prior to the date of conversion of
all or any part of the debentures. The conversion price was $0.0615, based on a
closing date of April 1, 2002.

The Class A Warrants had a term that expired on April 1, 2009. The Class A
Warrants were exercisable into an amount of the Company's common stock that was
equal to the quotient of the principal amount of the debentures issued by the
Company, divided by the conversion price. The exercise price of the Class A
Warrants was an amount equal to 50% of the lesser of the average of the lowest
three closing bid prices of the Company's common stock during the 30 trading
days immediately prior to the date the financing transaction closed or the 30
trading days immediately prior to the date or dates that all or any portion of
the warrants were exercised. On June 15, 2003, the financing transaction was
restructured, the Class A Warrants were exercised and the Company issued a total
of 22,142,847 shares of its common stock. The Class A Warrants included a
cashless exercise feature.

The Class B Warrants had a term that was to have expired two years following the
effective date of the registration statement that was to be filed to register
the common stock issuable upon exercise of the warrants. The Class B Warrants
were exercisable into an amount of the Company's common stock that was equal to
five times the quotient of the principal amount of each debenture issued in the
financing, divided by its conversion price. The exercise price of the Class B
Warrants was an amount equal to the lesser of 105% of the average of the lowest
three closing bid prices of the Company's common stock during the 30 trading
days prior to the date the financing transaction closed or an amount equal to
50% of the average of the lowest three closing bid prices of the Company's
common stock during the 30 trading days immediately prior to the date or dates
that all or any portion of the warrants were exercised. On June 15, 2003, the
financing transaction was restructured and the Class B Warrants were retired.
The Class B Warrants did not include a cashless exercise feature.

On June 15, 2003 a  restructuring  agreement was entered into between  Advantage
Fund, LLC and all of the investors who held our 12% debentures.  Pursuant to the
restructuring agreement,

(i)  the shares that had been issued to the note holders were returned
     to treasury;

(ii) Advantage Fund LLC and its designees  exercised the Class A Warrants and the Company
     issued to them a total of 22,142,847 shares of its restricted common stock.

(iii) the Class B Warrants were retired;

(iv) the principal amount of the debentures was increased to $337,195;

(v)  the  interest  rate  of the  debentures  was  reduced  to 6%  and  is  paid
     quarterly; and

(vi) the due date of the debentures was extended until June 15, 2005.



NOTE 9 - COMMITMENTS AND CONTINGENCIES

         Leases
          The Company  leases its office  facilities  from a related party under
          operating lease agreements,  which expire in December 2003 and require
          monthly payments of $4,000 per month.

          Future  minimum  payments  under these  operating  and  capital  lease
          agreements at December 31, 2001 were as follows:

                   Year Ending                                                    Operating
                  December 31,                                                      Leases

                      2003                                                       48,000

                                                                        $        48,000
                  Less amount representing interest                     ================

         Rent expense was $48,000 and $145,000 for the years ended December 31, 2002 and 2001, respectively.

         Financial Consulting Agreement
          On  January  1,  1999,  the  Company  entered  into a  non-cancelable,
          Corporate Financial  Consulting  Agreement with its  Chairman/majority
          shareholder.  The  agreement  calls for the Company to pay the related
          party  a  monthly  fee  of  $3,000  for a  period  of  five  years  in
          consideration  for the related party providing  general  assistance in
          identifying  credit/capital  resources  as well as  providing  office,
          personnel, and facilities to the Company.

          In addition,  the  agreement  calls for the Company to pay the related
          party a 1% success fee for any gross  amount of debt  financing or net
          worth of any entity merged or acquired on behalf of the Company by the
          related  party and a 1% renewal  fee of the  amount of such  financial
          arrangements for a period of five years.  Management believes that the
          monthly fee  approximates  the value of these services had the Company
          obtained these services from an unrelated party.

            In regards to the above fees, during 2002 the Company paid the chairman $15,000
          towards the $3,000/monthly fee.  No success fees for financing were
          paid during 2002.


                                      F-16


NOTE 9 - COMMITMENTS AND CONTINGENCIES (Continued)

         Employment Agreements
          On January 1, 1999, the Company  entered into an employment  agreement
          with  its  Chairman/majority  shareholder.  Under  the  terms  of  the
          agreement,  the employee  receives a salary of $250,000 per year or 5%
          of gross revenue of the Company, whichever is greater. The Company may
          not  terminate  the  agreement  for any  reason as it  relates  to the
          employee's disability, illness, or incapacity. Should the employee die
          during the term of  employment,  the Company  will pay the  employee's
          estate  $500,000 in 50 monthly  installments  of  $10,000.  Subject to
          certain  events,  including  the  sale  of  substantially  all  of the
          Company's assets to a single purchaser or bankruptcy,  the Company may
          terminate  the  agreement  upon 90 days'  written  notice  and pay the
          employee $500,000 in 12 consecutive monthly installments.

          With cause,  the Company may terminate  the agreement  with 12 months'
          written  notice.  During the notice period,  the employee will be paid
          full compensation and receive a severance  allowance of $250,000 in 12
          consecutive monthly installments beginning on the date of termination.
          Without cause,  the employee may terminate  employment upon 12 months'
          written notice to the Company.  During the notice period, the employee
          may be  required  to  perform  his  duties  and  will be paid his full
          compensation up to the  termination  date and will receive a severance
          allowance of $250,000,  which will be paid in 12 equal and consecutive
          monthly installments beginning on the date of termination.

          This  employee  received  common  stock  in lieu of  $101,000  in cash
          compensation during the year ended December 31, 2000.

          On November 1, 1999,  the Company  entered into a one-year  employment
          agreement  with  its  Vice   President/director,   which  contains  an
          automatic  three-year renewal.  Under the terms of the agreement,  the
          employee  receives a salary of $36,000 per year, plus paid vacation of
          five weeks. The Company may not terminate the agreement for any reason
          as it relates to the employee's  disability,  illness,  or incapacity.
          Subject to certain events,  including the sale of substantially all of
          the Company's assets to a single purchaser or bankruptcy,  the Company
          may terminate the agreement  upon 90 days' written  notice and pay the
          employee $500,000 in 12 consecutive monthly installments.

          With cause,  the Company may terminate  the agreement  with 12 months'
          written  notice.  During the notice period,  the employee will be paid
          full compensation and receive a severance  allowance of $250,000 in 12
          consecutive monthly installments beginning on the date of termination.
          Without cause,  the employee may terminate  employment upon 12 months'
          written notice to the Company.  During the notice period, the employee
          may be  required  to  perform  his  duties  and  will be paid his full
          compensation up to the  termination  date and will receive a severance
          allowance of $250,000,  which will be paid in 12 equal and consecutive
          monthly installments beginning on the date of termination.

        Factoring Agreement - Continuing Operations

          The Company  will  require  future  financing  in various  forms.  The
          Company  is  financing  working  capital  timing  differences  with an
          asset-based line of credit factoring agreement with Langsam Borenstein
          Partnership. In April 2002, the Company entered into an agreement with
          Langsam Borenstein  providing for sale of selected accounts receivable
          belonging to the Company to Langsam  Borenstein  in the face amount of
          at least  $5,000.00 per month.  Langsam  Borenstein in accordance with
          the terms of the agreement charges a varying  percentage rate on each
          invoice sold by the Company to Langsam  Borenstein from 4% for payment
          by the  customer  within 30 days to 10% for  payment  by the  customer
          between 81 to 90 days.

         Litigation
          The Company is involved in certain legal  proceedings and claims which
          arise in the normal  course of business.  Management  does not believe
          that the outcome of these  matters will have a material  effect on the
          Company's financial position or results of operations.

          Subsequent  to December  31,  2001,  the Company has become a party to
          several lawsuits as follows:

          o    A vendor is suing  the  Company  for  approximately  $9,900  with
               respect to materials purchased and services rendered on behalf of
               the Company.

          o    A bank is  suing  the  Company  for  approximately  $38,900  with
               respect to an overdrawn bank account.

          o    A customer is suing the Company for  approximately  $26,350  with
               respect to merchandise that is delinquent.

          o    The Company is suing a former  director  for breach of  warranty,
               breach of contract,  and fraud. In addition,  the former director
               has threatened to file a lawsuit against the Company.

          o    A former employee is suing the Company for unpaid wages, unissued
               stock, and expenses in the amount of approximately $50,000.

          o   A  vendor   obtained  a  judgment   against   the   Company   for
               approximately  $245,000. Upon default of the judgment, the vendor
               seized approximately $100,000 from the Company. The Company still
               owes the vendor approximately $100,000. The vendor may attempt to
               seize  additional funds or assets from CMG in connection with the
               judgment.



                                      F-17


NOTE 10 - SHAREHOLDERS' DEFICIT

         Common Stock
          During the years ended  December  31, 2002 and 2001,  the Company sold
          2,011,666  and  837,647  shares,  respectively,  of  common  stock for
          $306,000 and $175,000, respectively, under regulation 4(2). Regulation
          4(2)  provides  for the sale of  restricted  shares  of  common  stock
          without the preparation of a prospectus.  The shares offered cannot be
          sold for a period of one year.

          During the years ended  December 31, 2002 and 2001, the Company issued
          3,077,000  and  3,659,000  shares,  respectively,  of common  stock to
          employees and members of its Board of Directors for services rendered.
          Compensation  expense of $274,586 and  $1,463,610 was recorded with an
          offset to common stock and additional paid-in capital during the years
          ended December 31, 2002 and 2001, respectively.

          During the years ended  December 31, 2002 and 2001, the Company issued
          10,888,601  and  1,331,500  shares,  respectively,  of common stock to
          outside consultants and companies for services rendered.  These shares
          were  recorded  at their fair  market  value at the time of  issuance.
          Compensation  expense of $992,055 and  $430,715  was recorded  with an
          offset to common stock and additional paid-in capital during the years
          ended December 31, 2002 and 2001, respectively.

          On April  1,  2002 API  exchanged  250,000  of  common  stock  for the
          inventory and master tapes of Sunset  Productions,  Inc. The inventory
          and masters were valued at $67,500, the value of the 250,000 shares on
          April 1, 2002. (250,000 x $0.027 = $67,500)

          Stock issued to employees  and for the  inventory  and master tapes of
          Sunset Productions, Inc. was valued at the market value on the date of
          grant.  The value of the stock  issued to  consultants  was  privately
          negotiated.

         Stock Option Plan
          In June  2000,  the Board of  Directors  approved  the  adoption  of a
          non-qualified and incentive stock option plan, the 2000 Stock Purchase
          and  Option  Plan  (the  "Plan").  The  Plan is  intended  to  provide
          incentive to key employees,  officers,  and consultants of the Company
          who provide significant  services to the Company.  There are 5,000,000
          options  available for grant under the Plan.  Options will vest over a
          period of time as  determined  by the Board of Directors  for up to 10
          years from the date of grant. The Plan expires on June 30, 2010.

          The  exercise  price  of  options  granted  under  the  Plan  will  be
          determined by the Board of Directors, provided that the exercise price
          will  not be less  than 85% of the  fair  market  value on the date of
          grant. In addition, if the option is granted to an officer or director
          of the Company,  the exercise  price will not be less than 100% of the
          fair market value on the date of grant.  Furthermore,  incentive stock
          options may not be granted to a 10%  shareholder,  unless the exercise
          price is 100% of the fair market value on the date of grant.

                                      F-18


NOTE 10 - SHAREHOLDERS' DEFICIT (Continued)

         Stock Option Plan (Continued)
         A summary of the Company's outstanding options and activity is as follows:
                                                                                     Weighted-
                                                                                      Average
                                                                     Number          Exercise
                                                                  of Options           Price

                  Outstanding, December 31, 2000                 2,153,000           $  0.20
                      Granted                                    2,375,000           $  0.23
                      Cancelled                                 (2,103,000)          $  0.20
                                                                ----------

                           Outstanding, December 31, 2001        2,425,000        $     0.24
                                                                ==========

                           Exercisable, December 31, 2001        2,425,000        $     0.24
                                                                ==========

                 Outstanding, December 31, 2001                  2,425,000           $  0.24
                      Granted                                            0
                      Forfeited                                     75,000
                                                                ----------
                           Outstanding, December 31, 2002        2,350,000           $  0.24
                                                                ==========

                           Exercisable, December 31, 2002        2,350,000           $  0.24


                                                                ==========

          The  weighted-average   remaining  contractual  life  of  the  options
          outstanding  at December 31, 2002 is 1.00 years.  The exercise  prices
          for the options  outstanding at December 31, 2002 ranged from $0.05 to
          $0.50, and information relating to these options is as follows:

                                                                                    Weighted-        Weighted-
                                                                  Weighted-          Average          Average
                                                                   Average           Exercise         Exercise
             Range of              Stock             Stock       Remaining           Price of         Price of
             Exercise            Options           Options       Contractual         Options           Options
               Prices        Outstanding        Exercisable            Life       Outstanding       Exercisable

         $             0.05          200,000           200,000        1.00 years  $      0.05      $       0.05
         $      0.17 - 0.20          600,000           600,000        1.00 years  $      0.17      $       0.17
         $             0.50        2,200,000         2,200,000        1.00 years  $      0.50      $       0.50
                                   ---------         ---------
                                   3,000,000         3,000,000
                                   =========         =========


                                      F-19


NOTE 10 - SHAREHOLDERS' DEFICIT (Continued)

         Stock Option Plan (Continued)
          The Company has adopted  only the  disclosure  provisions  of SFAS No.
          123. It applies APB No. 25 and related  interpretations  in accounting
          for its  plans and does not  recognize  compensation  expense  for its
          stock-based  compensation  plans other than for  restricted  stock and
          options issued to outside third parties. If the Company had elected to
          recognize  compensation expense based upon the fair value at the grant
          date for awards  under these  plans  consistent  with the  methodology
          prescribed  by SFAS 123,  the  Company's  net loss and basic  loss per
          share for the  years  ended  December  31,  2002 and 2001  would be as
          follows:

                                                                  2001               2002
                  Net loss
                      As reported                         $    (5,775,333)   $     (2,238,437)
                      Pro forma                           $    (6,040,104)   $     (2,328,437)
                  Basic loss per common share
                      As reported                         $         (0.52)   $          (0.41)
                      Pro forma                           $         (0.54)   $          (0.42)

          For purposes of computing the pro forma  disclosures  required by SFAS
          No.  123,  the fair  value of each  option  granted to  employees  and
          directors is estimated using the  Black-Scholes  option-pricing  model
          with the following  weighted-average  assumptions  for the years ended
          December   31,  2001  and  2002:   dividend   yields  of  0%  and  0%,
          respectively;  expected  volatility  of 175%  and  N/A,  respectively;
          risk-free interest rates of 3.6% and 4.6%, respectively;  and expected
          lives of two and three years, respectively.  The weighted-average fair
          value of options  granted  during the year ended December 31, 2001 for
          which the  exercise  price was  greater  than the market  price on the
          grant  date was $0.34,  and the  weighted-average  exercise  price was
          $0.50. The  weighted-average  fair value of options granted during the
          year ended  December  31, 2001 for which the  exercise  price was less
          than  the  market  price  on  the  grant  date  was  $0.46,   and  the
          weighted-average exercise price was $0.05.

          The  Black-Scholes  option  valuation  model was  developed for use in
          estimating  the fair  value of traded  options  which  have no vesting
          restrictions and are fully transferable. In addition, option valuation
          models require the input of highly  subjective  assumptions  including
          the expected stock price  volatility.  Because the Company's  employee
          stock options have characteristics  significantly different from those
          of  traded  options,  and  because  changes  in the  subjective  input
          assumptions  can  materially  affect  the  fair  value  estimate,   in
          management's opinion, the existing models do not necessarily provide a
          reliable  single  measure  of the  fair  value of its  employee  stock
          options.

          In the  event of a merger,  sale of the  Company,  a hostile  takeover
          attempt,  or  other  sales  of the  Company's  assets,  each  director
          previously  granted  options will have the option to purchase  300,000
          additional shares of common stock at $1 per share.



                                      F-20


NOTE 11  - INCOME TAXES

          A reconciliation of the expected income tax computed using the federal
          statutory  income rate to the Company's  effective  rate for the years
          ended December 31, 2002 and 2001 was as follows:

                                                                                2002               2001
                  Income benefit computed at federal statutory tax
                      rate                                                      (34.0)%             (34.0)%
                  State taxes, net of federal benefit                            (5.0)               (5.0)
                  Permanent differences                                           6.0                 6.0
                  Valuation allowance                                            33.0                33.0

                         Total                                                      - %                 - %

          Significant components of the Company's deferred tax assets for income
          taxes consisted of the following at December 31, 2001:

                  Deferred tax assets
                      Net operating loss carry forward                          $      4,191,516

                  Less valuation allowance                                             4,191,516

                           Net deferred tax assets                              $              -

          As  of  December  31,  2001,   the  Company  had  net  operating  loss
          carry forwards   for   federal  and  state   income  tax   purposes  of
          approximately  $3,767,097  and  $2,447,000,   respectively.   The  net
          operating  loss  carry forwards   begin  expiring  in  2017.

NOTE 12 - RELATED PARTY TRANSACTIONS

          The Company  entered into a financial  consulting  agreement  with its
          Chairman/majority shareholder (see Note 9).

          The  Company   entered   into  an   employment   agreement   with  its
          Chairman/majority shareholder (see Note 9).

          The  Company  entered  into an  employment  agreement  with  its  Vice
          President/director (see Note 9).

          During the year ended December 31, 2001, the Company issued a total of
          2,965,000  shares of common stock to various  Board  members,  various
          officers/Board  members, and the Chairman/majority  shareholder valued
          at $1,156,000, which represents the fair market value.





                                      F-21


NOTE 13 - SUBSEQUENT EVENTS - UNAUDITED (Continued)

     On January 6, 2003 two  directors  were  awarded  5,000,000  and  3,000,000
     respectively of Americana Publishing,  Inc. common stock in lieu of salary.
     The stock was valued at $0.035  per share,  the  average  market  price for
     January 2003. Total compensation  expense of $280,000 was booked during the
     first quarter of 2003 and reflected on the 10Q ending March 31, 2003.

On August 2, 2003 Corporate Media Group, Inc., the Company's subsidiary, filed
for relief under Chapter 7 of Title 11, United States Bankruptcy Code for the
Eastern District of Tennessee, Case No. 03-15217. As a result of the bankruptcy
filing, the Company does not expect to experience adverse consequences as a
result the default by Corporate Media Group, Inc. on its obligations. The
Company expects all of Corporate Media Groups, Inc.'s debts to be discharged as
a result of the bankruptcy proceeding. Corporate Media Group, Inc. will no
longer operate, and will not be required to continue obtaining services from its
vendors.

NOTE 14 -  Subsequent Restatement of Financial Information

Based on a review of the December 31, 2002 10-K, certain changes were made to the
financial statements to provide and explain more fully certain information.
None of these changes resulted in a change to the net loss or shareholders equity.

The Consolidated Balance Sheet for December 31, 2002 has been restated to separate
"Notes Payable-related parties" from "Convertible Debt-related parties".  The
changes are shown below.

                                                         As previously filed           Restated
    Notes Payable-related parties                                    -                  125,546
    Convertible Debt-related parties                           513,046                  387,500

The Consolidated Statement of Operations for 2001 has been restated to initiate a
new line item titled "Impairment of Goodwill of discontinued operations".
The change is shown below.

                                                         As previously filed           Restated
     Loss from discontinued operations                      (1,937,270)              (1,031,537)
     Impairment of Goodwill of discontinued operations               -                 (905,733)

The Consolidated Statement of Operations for 2001 has also been restated to include
two line items, one for "Financing Expense" related to convertible debt and one for
"Interest Income".  The totals for "Net Loss" have not changed.

                                                         As previously filed           Restated
      Financing Expense related
        convertible debt                                             -                 (385,000)
      Interest Income                                                -                      196
      Total other Income/Expense                               (28,164)                (412,968)

The Consolidated Statement of Shareholders Equity has been changed.  The statement
of changes in shareholders equity for December 31, 1999 has been removed.  A line
item showing the net loss of (2,519,082) for December 31, 2002 has been added.
Also, a total column has been added reflecting the total impact of the various
activities on the stockholders equity section.

The Consolidated Statement of Cash Flows as of December 31, 2002 has been restated.
The changes to the Consolidated Statement of Cash Flows for December 31, 2002 are as follow:

                                                           As previously filed         Restated
     Issuance of common stock to outside
     Consultants in exchange for services                     816,589                   992,055

    Increase in Accounts Receivable                          (271,611)                 (307,126)
    Increase in Inventory                                    ( 26,904)                 ( 48,886)
    Increase in Factor Payable                                167,551                    62,975
    Increase in Accrued Expenses                              104,576                    94,241

    Net cash used in Operating Activities                    (407,614)                 (404,556)

    Proceeds from Notes Payable                               130,615                   125,545
    Proceeds from sale of common stock                        303,988                   306,000

    Net cash provided by continuing
    financing activities                                      434,603                   431,545
                                      F-22


     Item 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
                              FINANCIAL DISCLOSURE

Singer Lewak Greenbaum & Goldstein LLP, the independent accountants we had
engaged as the principal accountants to audit our consolidated financial
statements was dismissed effective October 16, 2002. On October 18, 2002, we
engaged Philip H. Salchli, CPA as our principal independent accountant to audit
our consolidated financial statements for the year ending December 31, 2002.

The decision to change our independent accountants from Singer Lewak Greenbaum &
Goldstein LLP to Philip H. Salchli, CPA was approved by our Board of Directors.

The report of Singer Lewak Greenbaum & Goldstein LLP on our financial statements
as of and for the year ended December 31, 2001 did not contain an adverse
opinion, or a disclaimer of opinion, however the report was modified as to our
ability to continue as a going concern. During the one-year period ended
December 31, 2001, and the interim period from January 1, 2002 through the date
of dismissal, we did not have any disagreements with Singer Lewak Greenbaum &
Goldstein LLP on any matter of accounting principles or practices, financial
statement disclosure, or auditing scope or procedure, which disagreements, if
not resolved to the satisfaction of Singer Lewak Greenbaum & Goldstein LLP,
would have caused it to make a reference to the subject matter of the
disagreements in connection with its reports.

Prior to retaining Singer Lewak Greenbaum & Goldstein LLP, our financial
statements were prepared by Null Lairson CPA, PC. The reports of Null Lairson
CPA, PC on our financial statements for the year ended December 31, 2000 did not
contain an adverse opinion, or a disclaimer of opinion, nor were they qualified
or modified as to uncertainty, audit scope, or accounting principles. During the
two year period and any subsequent interim period preceding its dismissal, there
were no disagreements with Null Lairson CPA, PC on any matter of accounting
principles or practices, financial statement disclosure, or auditing scope or
procedure, which disagreements, if not resolved to the satisfaction of Null
Lairson CPA, PC, would have caused Null Lairson CPA, PC to make reference to the
subject matter of the disagreements in connection with its report.

Prior to engaging Philip H. Salchli, CPA, we had not consulted Philip H.
Salchli, CPA, regarding the application of accounting principles to a specified
transaction, completed or proposed, or the type of audit opinion that might be
rendered on our financial statements.

                 Item 8A. DISCLOSURE CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures. Regulations under the
Securities Exchange Act of 1934 require public companies to maintain "disclosure
controls and procedures," which are defined to mean a company's controls and
other procedures that are designed to ensure that information required to be
disclosed in the reports that it files or submits under the Securities Exchange
Act of 1934 is recorded, processed, summarized and reported, within the time
periods specified in the Commission's rules and forms. Our Chief Executive
Officer ("CEO") and our Chief Financial Officer ("CFO") carried out an
evaluation of the effectiveness of our disclosure controls and procedures as of
the end of the period covered by this report. Based on those evaluations, our
CEO and CFO believe:

(i) that our disclosure controls and procedures are designed to ensure that
information required to be disclosed by us in the reports we file under the
Securities Exchange Act of 1934 is recorded, processed, summarized and reported
within the time periods specified in the SEC's rules and forms and that such
information is accumulated and communicated to our management, including the CEO
and CFO, as appropriate to allow timely decisions regarding required disclosure;
and

(ii) that our disclosure controls and procedures are effective.


                                       17



Changes in Internal Controls. There were no significant changes in our internal
controls or, to our knowledge, in other factors that could significantly affect
our internal controls subsequent to the evaluation date. In the future, however,
we intend to seek legal assistance with the preparation of our reports.

                                    PART III

                Item 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS
     AND CONTROL PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

     Directors and Executive Officers and Advisors to the Board of Directors

Name                            Age              Position

George Lovato, Jr.              46               CEO/Chairman/President
Don White                       51               Director/Vice President/CFO
David Poling                    73               Director/Vice President
Jay Simon                       43               Director/Secretary/Treasurer
Jerome Ruther                   68               Director
Lowell S. Fixler                68               Advisor to the Board
Philippe de La Chapelle         60               Advisor to the Board
Stedman Walker, Ltd.            N/A              Advisor to the Board/Consultant

All Directors of the Company will hold office until the next annual meeting of
shareholders of the Company or until their successors are duly elected and
qualified.

The officers of the Company are appointed by the Board of Directors at the first
meeting after each annual meeting of the Company's shareholders, and hold office
until their death, or until they shall resign or have been removed.

George Lovato, Jr., Chief Executive Officer, President, Chairman and Director

Mr. Lovato is our founder and has been a Director, Chairman and President since
our inception. Over the past 15 years Mr. Lovato has acquired extensive
management experience with startup companies, corporate finance, computer system
and software development, international trade and relations, strategic planning,
and sales and marketing development. Mr. Lovato has rendered services to
companies engaged in business management, public relations, advertising,
corporate finance, agriculture, automotive industry consulting, travel, auto
rental and leasing, and insurance.

Mr. Lovato was educated in New Mexico. He is the principal and sole owner of B.
H. Capital Limited, a merchant banking and corporate finance consulting
enterprise located in Albuquerque, New Mexico with branch offices in Denver,
Colorado and Houston, Texas.

Don White, Director, Vice President and Chief Financial Officer

Mr. White is a CPA in Houston, Texas, and has operated an accounting practice
for over 20 years. Mr. White was educated at Sam Houston State University and
received his degree in accounting in 1972. Mr. White has broad expertise in the
development of market value financial statements. He currently advises the
Company on general financial matters and corporate development and oversees the
audit and acquisition committees. Mr. White has served as a director and as Vice
President of the Company since its inception.


                                       18



Dr. David Poling, Director and Vice President

Dr. Poling is Chairman of Sierra Publishing Group, the author of a dozen books
and a nationally syndicated columnist whose column is published in 600
newspapers. Formerly, Dr. Poling was in charge of The Christian Herald, a
publication with a half million monthly circulation. Dr. Poling is also the
President of the Family Bookshelf, the largest religious book club in the United
States. Dr. Poling is a Presbyterian clergyman educated at College of Wooster,
Ohio and Yale University. Dr. Poling has served on the board as a Director and
as a Vice President since the Company's inception.

Jay Simon, Director and Secretary/Treasurer

Mr. Simon graduated from the University of New Mexico in 1986 with a BS in
Pharmacy. Mr. Simon is currently employed as Executive Director of International
Business Development of Syncor International Corporation, a nuclear
pharmaceutical company. Mr. Simon has served as a Director and as the Company's
Secretary/Treasurer since its inception.

Jerome Ruther, Director

Mr. Ruther graduated from Northwestern University in 1954 with a degree in
accounting. Later Mr. Ruther graduated from Northwestern University Law School
and practiced in the legal profession for approximately 20 years. Mr. Ruther has
had business experience with various media businesses and real estate
developments. He was also a controlling shareholder of Sunset Productions, Inc.,
an audio book production company. Mr. Ruther has been a Director of the Company
since January 2001.

Lowell S. Fixler, Advisor to the Board of Directors

Mr. Fixler graduated from Northwestern University in 1954. Mr. Fixler was
president and controlling shareholder of Needlecraft Corporation of America,
which was purchased by Quaker Oats Co. After its purchase by Quaker Oats Co.,
Mr. Fixler remained as president of the division. Mr. Fixler has been an
investor in various start-up companies and in numerous business enterprises.

Philippe de La Chapelle, Advisor to the Board of Directors

Mr. de La Chapelle formerly was the Managing Director of Hill Thompson Capital
Markets, Inc., an investment banking firm founded in 1932. Mr. de La Chepelle
specializes in the development of United States and offshore corporate finance
opportunities. A graduate of Georgetown Law School, he has been international
counsel for W.R. Grace and Co. Currently, he is Executive Vice President of
Warnaco.

Stedman Walker, Ltd., Advisor to the Board of Directors

Stedman Walker, Ltd. is a corporate finance and investor relations consulting
firm with over 100 years of experience.

                        Item 10. EXECUTIVE COMPENSATION

The following table shows the compensation paid over the past three fiscal years
with respect to: (i) the Company's Chief Executive Officer and President as of
the end of the 2002 fiscal year; (ii) the four other most highly compensated
executive officers (in terms of salary and bonus) serving at the end of the 2002
fiscal year whose annual salary and bonus exceeded $100,000; and (iii) up to two
additional individuals who would be in category (ii) but for the fact that the
individual was not serving as an executive officer of the Company at the end of
the last completed fiscal year (the "named executive officers"):


                                       19



                           SUMMARY COMPENSATION TABLE

                                         LONG TERM COMPENSATION
                     ANNUAL COMPENSATION                  AWARDS         PAYOUTS
          (a)         (b)     (c)       (d)       (e)       (f)          (g)         (h)       (i)

                                                 Other
         Name                                    Annual   Restricted   Securities   LTIP       All
          And                                    Compen   Stock        Underlying   Payouts    Other
       Principal             Salary     Bonus    sation   Award(s)     Options      SARs(1)    Compen
       Position       Year     ($)       ($)       ($)       ($)                    ($)        sation

     George Lovato
     CEO/Director
                      2002   27,000         0         0    35,000         0         0         0
                      2001  141,000         0         0   264,000         0         0         0
                      2000  147,000         0         0   280,000         0         0         0

       Jay Simon
Sec/Treas/Director
                      2002        0         0         0         0         0         0         0
                      2001        0         0         0   138,000         0         0         0
                      2000        0         0         0    50,000         0         0         0

     David Poling
V. President/Director
                      2002        0         0         0    17,500         0         0         0
                      2001        0         0         0    94,000         0         0         0
                      2000        0         0         0   150,000         0         0         0

     Jerome Ruther    2002        0         0         0         0         0         0         0
       Director(2)    2001   15,000         0         0   205,500   328,000         0         0
                      2000        0         0    45,000         0         0         0         0

      Don White       2002   14,583         0         0    17,500         0         0         0
    CFO/Director      2001   22,500         0         0   329,000         0         0         0
                      2000        0         0         0         0         0         0         0

(1)  No SARs were granted or exercised by any named executive officer in any of,
     the last three fiscal  years.

(2)  Amounts  paid to Mr.  Ruther were paid for work done for us in  conjunction
     with the creation of our audio books division.

No stock options were granted or exercised by any executive officer during the
fiscal year ended December 31, 2002.

On January 1, 1999 we entered into an employment agreement with Mr. George
Lovato, our President. The term of the agreement is automatically renewed each
year for a period of three years unless either party elects to terminate it. Mr.
Lovato is to receive compensation at the rate of $250,000 per year or 5% of our
gross revenue, whichever is greater. Mr. Lovato will not receive any deferred
compensation from Americana. We may not terminate the agreement if Mr. Lovato
becomes disabled, ill or incapacitated. If Mr. Lovato dies during the term of
employment, we must pay his estate the sum of $500,000 in fifty monthly
installments of $10,000 each. Subject to certain events, including the sale of
substantially all of our assets to a single purchaser and bankruptcy, among
others, we may terminate the agreement upon 90 days written notice if we pay Mr.
Lovato the sum of $500,000 in twelve consecutive monthly installments. We may
terminate the agreement for cause with twelve months written notice. During the
notice period, we must continue to pay Mr. Lovato the full amount of his
compensation. Mr. Lovato will also receive a severance allowance of $250,000
made in twelve consecutive monthly installments beginning on the date of
termination. Mr. Lovato may terminate his employment upon 12 months written
notice to us.


                                       20


Mr. Don White is paid $3,000 per month for his services as Chief Financial
Officer. On November 1, 1999 we entered into an employment agreement with Mr.
White. The agreement may be terminated for cause or on 90 days written notice.
The agreement may not be terminated if Mr. White becomes disabled. If
termination occurs due to certain corporate events, such as a sale of
substantially all of our assets, the purchase of our stock in a transaction
meant to take us "private", the termination of our business or the liquidation
of our assets, or other enumerated events, we will be required to pay Mr. White
the sum of $500,000 which may be paid in 12 consecutive monthly installments. If
we terminate Mr. White's employment for cause, we will be required to pay him a
severance payment of $250,000, which may be paid in 12 consecutive monthly
installments. Mr. White may terminate his employment by giving us 12 months
notice. If he terminates his employment, we will be required to pay Mr. White a
severance payment of $250,000, which may be paid in 12 consecutive monthly
installments.

Directors do not currently receive any form of cash compensation for their
participation on the Company's Board of Directors.

     Item 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth the stock ownership of each person known by the
Company to be a beneficial owner of five percent (5%) or more of the Company's
equity securities, each Director individually and all, Directors and officers of
the Company as a group. Each person has sole voting and investment power with
respect to the shares shown unless otherwise indicated.


Name and Address of                         Amount Own           Shares
   Beneficial Owner      Title of Class    Beneficially       owned % of
--------------------------------------------------------------------------------

George Lovato, Jr             Common         3,144,000            4.8%
12310 Claremont NE
Albuquerque, NM  87112

Don White                     Common         1,200,000            1.9%
8106 Devonwood
Huston, TX  77070

Jerome Ruther                 Common         1,075,000            1.7%
1208 North Summit Drive
Santa Fe, NM  87501

Jay Simon                     Common           400,000             .6%
5528 E. Cheryl Drive
Paradise Valley, AZ  85253

David Poling                  Common           762,310            1.2%
3616 San Rio Place NW
Albuquerque, NM  87107

Total Shares of Officers and
Directors as a Group          Common         6,581,310           10.2%

For information  concerning our equity  compensation  plans,  see Item 5 of this
Annual Report on Form 10-KSB.


                                       21


             Item 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

On January 1, 1999 we entered into a Corporate Finance Consulting Agreement with
B. H. Capital Limited, an entity controlled by our President and Chief Executive
Officer,  Mr. George Lovato,  Jr. The term of the agreement is for 5 years. This
agreement  requires  us to pay a success  fee to B. H.  Capital  Limited for any
financing  obtained for Americana by B. H. Capital  Limited.  The success fee is
calculated as 1% of the gross amount of financing raised.

We pay B. H. Capital Limited a $3,000.00  monthly facility use fee for use of B.
H. Capital Limited's office, personnel, and facilities.  This agreement was also
entered into on January 1, 1999 and had an initial term of 3 years. The lease is
currently continuing on a month-to-month basis.

In January 2000 we entered into a lease with Tierra Americana Real Estate,  LLC,
an entity  controlled by our President and Chief Executive  Officer,  Mr. George
Lovato,  Jr., for the premises  located at 142 Truman Street,  Albuquerque,  New
Mexico. We use this space for offices and warehousing.  We also sublet a portion
of this space. The lease has a term of four years.

In September,  October and November 2001 our director,  Jerome Ruther, loaned us
$100,000, $100,000 and $100,000, respectively. Each loan accrues interest at the
rate of 30% per year. Interest is to be paid monthly and principle is to be paid
one year from the date of the loan.  No payments of principle  or interest  have
been paid toward this obligation.

In December 2001 our Chief Financial Officer and director,  Don White, loaned us
$10,000.  The loan accrues interest at the rate of 30% per year.  Interest is to
be paid monthly and  principle is to be paid one year from the date of the loan.
No payments of principle or interest have been paid toward this obligation.

During 2002 employees of Corporate  Media Group,  Inc. loaned money to Corporate
Media Group,  Inc. or its  division,  Visual  Energy  Studio.  The loans totaled
$83,397.  The loans were not documented with  promissory  notes. Of this amount,
$48,751 was loaned to Corporate Media Group by Richard Durand.

Until April 30, 2002 Corporate Media Group, Inc. occupied  approximately  45,000
square feet of warehouse,  office and manufacturing  space located at 142 Lupton
Lane,  Cleveland,  Tennessee,  which it rented from Richard Durand,  a member of
Corporate  Media  Group,  Inc.'s board of  directors.  The monthly rent for this
facility was $23,000.00.  Corporate Media Group, Inc. was unable to pay the rent
for this facility.

During the fiscal year ended  December  31,  2002,  we  received  loans from the
following directors:

            George Lovato                               $22,034
            Don White                                   $41,262
            Jerry Ruther                                $37,500
            David Poling                                $ 3,000



                                       22


                 Item 13. EXHIBITS AND REPORTS ON FORM 8-K

          3.1(i) - Articles of  Incorporation,  incorporated  by references from
               the  registrant's  Form  10-SB  filed  with  the  Securities  and
               Exchange Commission on April 15, 1999.
          3.2(ii) - Bylaws,  incorporated  by references  from the  registrant's
               Form 10-SB filed with the Securities  and Exchange  Commission on
               April 15, 1999.
          10.1 - Security  Agreement and Power of Attorney to Langsam Borenstein
             Partnership, ("Purchaser" by Americana Publishing, Inc.
               ("Seller") previously filed.
          10.2 - Agreement with Karim  Amiryani,  Douglas W. Jordan,  Douglas W.
               Jordan  Defined  Benefit  Pension  Plan,  Norman  Ross,  Tel  Pro
               Marketing, Stranco Investment and Vestcom for the purchase of 12%
               Convertible Debentures, previously filed.
          10.3 -  Restructure  Agreement  between  Advantage  Fund  I,  LLC  and
               Americana Publishing, Inc., previously filed.
          10.4 -  6%  Senior  Secured   Convertible   Debenture  issued  by  the
               registrant in favor of Advantage Fund I, LLC, previously filed.
          10.5 -  Convertible  Debenture  dated  September  13, 2001 in favor of
               Jerome Ruther, previously filed.
          10.6 - Convertible Debenture dated October 12, 2001 in favor of Jerome
               Ruther, previously filed.
          10.7 -  Convertible  Debenture  dated  November  21,  2001 in favor of
               Jerome Ruther, previously filed.
          10.8 -  Convertible  Debenture  dated  September  2002 in  favor of S.
               Fixler, previously filed.
          10.9 - Convertible Debenture dated October 2002 in favor of Don White,
               previously filed.
          10.10-  Convertible  Debenture  dated  December  2002 in  favor  of S.
               Fixler, previously filed.
          10.11- Promissory  Note dated  December 5, 2001 in favor of Don White,
               previously filed.
          10.12- Lease  between  Americana  Publishing,  Inc. and B. H. Capital,
               Inc.  for  premises  located  at 303 San  Mateo NE,  Suite  104A,
               Albuquerque, New Mexico, previously filed.
          10.13- Lease between Americana  Publishing,  Inc. and Tierra Americana
               Real  Estate,  LLC for  premises  located at 142  Truman  Street,
               Albuquerque,  New  Mexico,  incorporated  by  reference  from the
               registrant's  Form  10-KSB  (File No.  000-25783)  filed with the
               Securities and Exchange Commission on February 25, 2000.
          10.14- Lease between  Corporate Media Group,  Inc. and Rick Durand for
               premises located at 142 Lupton Lane, Cleveland,  Tennessee, previously filed
               .
          10.15- Employment  Agreement  between Americana  Publishing,  Inc. and
               George Lovato,  incorporated  by reference from the  registrant's
               Form 10-SB filed with the Securities  and Exchange  Commission on
               April 15, 1999.
          10.16- Employment  Agreement  between Americana  Publishing,  Inc. and
               Don White,  incorporated by reference from the registrant's  Form
               10-KSB  (File  No.  000-25783)  filed  with  the  Securities  and
               Exchange Commission on February 25, 2000.
          10.17-  Americana  Publishing,  Inc.  2000 Stock  Purchase  and Option
               Plan, incorporated by reference to the registrant's  registration
               statement  on Form S-8  (File  No.  333-  48408)  filed  with the
               Securities and Exchange Commission on October 23, 2000.
          10.18-  Americana   Publishing,   Inc.  2003  Equity  Incentive  Plan,
               incorporated  by  reference  from the  registrant's  registration
               statement  on Form  S-8  (File  No.  333-105369)  filed  with the
               Securities and Exchange Commission on May 19, 2003.
          10.19- Corporate Finance  Consulting  Agreement between the registrant
               and B. H.  Capital  Ltd.,  incorporated  by  reference  from  the
               registrant's  Form 10-SB filed with the  Securities  and Exchange
               Commission on April 15, 1999.
          10.20-  Form  of  12%  Senior  Secured  Convertible  Debenture,  previously filed.

          10.21- Form of Class A  Warrant  issued to BG  Holdings,  LLC and Gulf
               Coast Advisors, Ltd., previously filed.
          10.22- Form of Class B  Warrant  issued to BG  Holdings,  LLC and Gulf
               Coast Advisors, Ltd., previously filed.
          10.23- Form of Class A Warrant  issued to Toscana Group,  Inc.,  previously filed.

          10.24- Form of Class B Warrant  issued to Toscana Group,  Inc., previously filed.

          16.  - Letter on  change in  certifying  accountant,  incorporated  by
               reference  from the  Current  Report on Form 8-K  filed  with the
               Securities  and Exchange  Commission by the registrant on October
               22, 2002.
          23.  - Consent of Independent Auditor, filed herewith.
          31.1 - Certification  Pursuant to Rule 13a-14(a) and 15d-14(a),  filed
               herewith.
          31.2 - Certification  Pursuant to Rule 13a-14(a) and 15d-14(a),  filed
               herewith.
          32   -  Certification  Pursuant  to  Section  1350 of  Title 18 of the
               United States Code, filed herewith.

               -------------------------------------------------------


                                       23


                 Item 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

The  following  table sets forth fees  billed to us by our  auditors  during the
fiscal  years ended  December  31, 2002 and  December 31, 2001 for: (i) services
rendered for the audit of our annual financial  statements and the review of our
quarterly financial statements, (ii) services by our auditor that are reasonably
related to the  performance  of the audit or review of our financial  statements
and that are not reported as Audit Fees,  (iii) services  rendered in connection
with tax  compliance,  tax advice and tax planning,  and (iv) all other fees for
services  rendered.  "Audit  related fees"  consisted of consulting  relating to
accounting  issues.  "All other fees"  consisted of  valuation of certain  stock
options.

                                             December 31, 2002                 December 31, 2001

(i)         Audit Fees                       $30,000                           $59,806
(ii)        Audit Related Fees               $ 7,500                           $
(iii)       Tax Fees                         $                                 $
(iv)        All Other Fees                   $ 4,500                           $




                                   SIGNATURES

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


                                                        AMERICANA PUBLISHING, INC.


Date: June _28, 2005
                                                        By: /s/ George Lovato,Jr.
                                                           George Lovato, Jr., Chairman,
                                                           Chief Executive Officer and
                                                           President



Date: June 28, 2005                                     By: /s/ Don White   
                                                           Don White, Chief Financial
                                                           Officer

     In accordance  with the  requirements  of the Exchange Act, this report has
been  signed by the  following  persons on behalf of the  registrant  and in the
capacities and on the dates indicated:

Name                              Title                             Date

 /s/ George Lovato, Jr.
George Lovato, Jr.                Chairman, Chief Executive         June 28, 2005
                                  Officer and President

 /s/ Don White       
Don White                         Chief Financial Officer,          June 28, 2005
                                  Director

 /s/ David Poling    
Dr. David Poling                  Director                          June 28, 2005


 /s/ Jay Simon       
Jay Simon                         Director                          June 28, 2005


 /s/ Jerome Ruther   
Jerome Ruther                     Director                          June 28, 2005


                                       24


                                                                                                                           Exhibit
                                                                    Exhibit 31.1

                  CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER
                       PURSUANT TO RULES 13a-14 AND 15d-14
                     OF THE SECURITIES EXCHANGE ACT OF 1934

     I, George Lovato,  Jr.,  President and Chief Executive Officer of Americana
Publishing, Inc. (the "Company"), certify that:

I have reviewed this Amendment No. 2 to annual report on Form 10-KSB of Americana Publishing, Inc.

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.

Based on my knowledge, the financial statements, and other financial information
included in the report,  fairly  present in all material  respects the financial
condition,  results of operations  and cash flows of the Company as of, and for,
the periods presented in the report.

     The  Company'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 Company and have:

     (a)  designed  such  disclosure  controls  and  procedures,  or caused such
disclosure  controls and  procedures  to be designed  under my  supervision,  to
ensure  that  material  information  relating  to  the  Company,  including  its
consolidated subsidiaries,  is made known to me by others within those entities,
particularly during the period in which the periodic report is being prepared;

     (b) evaluated the  effectiveness of the Company's  disclosure  controls and
procedures and presented in this report our conclusions  about the effectiveness
of the disclosure  controls and procedures,  as of the end of the period covered
by this annual report based on such evaluation; and

     (c) disclosed in this annual  report any change in the  Company's  internal
control over financial  reporting that occurred during the Company's most recent
fiscal  quarter  that  has  materially  affected,  or is  reasonably  likely  to
materially affect, the Company's internal control over financial reporting; and

     The Company's other certifying officers and I have disclosed,  based on our
most recent  evaluation of internal  control over  financial  reporting,  to the
Company's  auditors and to the audit  committee  of the board of  directors  (or
persons fulfilling the equivalent function):

     (i)  all  significant  deficiencies  in the design or operation of internal
          control  over  financial  reporting  which  are  reasonably  likely to
          adversely affect the Company's ability to record,  process,  summarize
          and report financial information; and

     (ii) any fraud, whether or not material,  that involves management or other
          employees  who  have a  significant  role  in the  Company's  internal
          control over financial reporting.


Dated:  June 28, 2005



                                                         /s/ George Lovato, Jr.
                                                        George Lovato, Jr.
                                                        President and Chief Executive
                                                        Officer


                                       25

                                                                                                                           Exhibit
                                                                    Exhibit 31.2

                  CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER
                       PURSUANT TO RULES 13a-14 AND 15d-14
                     OF THE SECURITIES EXCHANGE ACT OF 1934

     I, Don White,  Chief Financial Officer of Americana  Publishing,  Inc. (the
"Company"), certify that:

I have reviewed this Amendment No. 2 to annual report on Form 10-KSB of Americana
Publishing, Inc.

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.

Based on my knowledge, the financial statements, and other financial information
included in the report,  fairly  present in all material  respects the financial
condition,  results of operations  and cash flows of the Company as of, and for,
the periods presented in the report.

     The  Company'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 Company and have:

     (a)  designed  such  disclosure  controls  and  procedures,  or caused such
disclosure  controls and  procedures  to be designed  under my  supervision,  to
ensure  that  material  information  relating  to  the  Company,  including  its
consolidated subsidiaries,  is made known to me by others within those entities,
particularly during the period in which the periodic report is being prepared;

     (b) evaluated the  effectiveness of the Company's  disclosure  controls and
procedures and presented in this report our conclusions  about the effectiveness
of the disclosure  controls and procedures,  as of the end of the period covered
by this annual report based on such evaluation; and

     (c) disclosed in this annual  report any change in the  Company's  internal
control over financial  reporting that occurred during the Company's most recent
fiscal  quarter  that  has  materially  affected,  or is  reasonably  likely  to
materially affect, the Company's internal control over financial reporting; and

     The Company's other certifying officers and I have disclosed,  based on our
most recent  evaluation of internal  control over  financial  reporting,  to the
Company's  auditors and to the audit  committee  of the board of  directors  (or
persons fulfilling the equivalent function):

     (i)  all  significant  deficiencies  in the design or operation of internal
          control  over  financial  reporting  which  are  reasonably  likely to
          adversely affect the Company's ability to record,  process,  summarize
          and report financial information; and

     (ii) any fraud, whether or not material,  that involves management or other
          employees  who  have a  significant  role  in the  Company's  internal
          control over financial reporting.


Dated:  June 28, 2005



                                                         /s/ Don White
                                        Don White
                                                        Chief Financial Officer


                                       26

                                                                                                                             Exhibit
                                                                      Exhibit 32

                            CERTIFICATION OF OFFICERS
                          OF AMERICANA PUBLISHING, INC.
                            PURSUANT TO 18 USC 1350

Pursuant to section 906 of the  Sarbanes-Oxley  Act of 2002 (subsections (a) and
(b) of Section  1350,  Chapter 63 of Title 18,  United  States Code) each of the
undersigned officers of Americana  Publishing,  Inc. (the "Company") does hereby
certify, to such officer's knowledge, that:

The Amendment No. 2 to annual  report on Form  10-KSB for the year ended  December
31, 2002 of the Company fully  complies with the  requirements  of section 13(a)
or 15(d) of the Securities Exchange Act of 1934 and the information contained in
the Form 10-KSB fairly presents,  in all material respects,  the financial condition
and results of operations of the Company.

Dated:  June 28, 2005



/s/ George Lovato, Jr.
George Lovato, Jr., President
and Chief Executive Officer


Dated  June 28, 2005


 /s/ Don White
Don White,
Chief Financial Officer


                                       27`