U.S. SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549
                                 FORM 10-KSB
(Mark One)
         [ X ]   ANNUAL REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES
                 EXCHANGE ACT OF 1934 For the fiscal year ended December 31,
                 1996.

COMMISSION FILE NUMBER:   0-3851
                          ------
                                SUNGROUP, INC.
-----------------------------------------------------------------------------
                (Name of small business issuer in its charter)

         Tennessee                                     62-0790469
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(State or other jurisdiction of                      (IRS Employer
 incorporation or organization)                    Identification No.)

    2201 Cantu Court, Suite 102A               Sarasota, Florida 34232-6254
----------------------------------------------------------------------------
(Address of principal executive offices)                (Zip Code)


Issuer's telephone number:        941-377-6710

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

Securities to be registered pursuant to Section 12(g) of the Exchange Act:

                          COMMON STOCK, NO PAR VALUE
----------------------------------------------------------------------------
                               (Title of class)

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

Check if 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. [ X ]

State issuer's revenues for its most recent fiscal year.  $8,950,038.

As of March 26, 1997, the aggregate market value of the Common Shares (based
on the average bid and asked price of $.375 per share in the over-the-counter
market) held by non-affiliates was approximately $700,973.

As of March 26, 1997, there were 6,543,700 Common Shares outstanding.

Transitional Small Business Disclosure Format. (Check One):   Yes     No   X
                                                                  ---     ---

                                    Page 1
                                                     Exhibit Index on Page 22

<PAGE>
                              TABLE OF CONTENTS

ITEM                                                                 PAGE
                                                                     ----
PART I
------
1   Description of Business                                            3

2   Description of Property                                            8

3   Legal Proceedings                                                  9

4   Submission of Matters to a Vote of Security Holders                9

PART II
-------
5   Market for Common Equity and Related
    Stockholder Matters                                                9

6   Management's Discussion and Analysis                               10

7   Financial Statements                                               12

8   Changes in and Disagreements with Accountants on
    Accounting and Financial Disclosure                                12

PART III
--------
9   Directors, Executive Officers, Promoters and Control
    Persons; Compliance with Section 16(a) of the Exchange Act         12

10  Executive Compensation                                             14

11  Security Ownership of Certain Beneficial Owners and Management     15

12  Certain Relationships and Related Transactions                     17

13  Exhibits and Reports on Form 8-K                                   18

    Signatures                                                         21

    Index to Exhibits                                                  22











                                      2
<PAGE>
                                    PART I

Item 1.  Description of Business

General
------

         SunGroup, Inc. ("Corporation") was incorporated in 1967 in the State
of Tennessee.  The Corporation's original name was Mooney Broadcasting
Corporation.  At a special stockholders meeting in 1984, a new Board of
Directors and corporate officers were elected and the Corporation's name was
changed to SunGroup, Inc.

         For the past five years, the Corporation's focus has been on
restructuring its debt obligations to generate sufficient cash flow to service
these requirements.  Since mid-1991, the Corporation has attempted to deal
with its liquidity needs.  There has been significant efforts to restructure
or pay down debts through negotiation and asset sales.  The Corporation is now
looking to outside sources to refinance and consolidate its restructured debt.
Failure to secure this restructured debt will severely hamper the
Corporation's ability to continue as a going concern.

Change in Equity
----------------

         In 1996, the Corporation's shareholder's equity deficit was
substantially reduced.  This improvement resulted from the Corporation's sale
of the assets of its Pensacola radio station and its related debt forgiveness
by the Federal Deposit Insurance Corporation ("FDIC"), significant debt
elimination due to Statutes of Limitations expirations applicable to other
Corporation debt, loan restructurings and equity conversion payments out of
cash flow.

Sale of Assets
--------------

         The Corporation consummated the sale of its FM radio station, WOWW,
in Pensacola, Florida on July 2, 1996.  The radio station constituted all of
the operating assets of the Corporation's subsidiary located in Florida.  The
assets were sold exclusive of certain retained assets, including, without
limitation, accounts receivable.  The sale price of the assets of the radio
station was $2.3 million in cash, plus certain closing costs of approximately
$150,000.

         The Corporation previously had entered into an agreement with the
FDIC, the first lien holder of the assets, on the disposition of the sale
proceeds of the Pensacola radio station and release of its lien thereon.  The
FDIC received $2.094 million from the Pensacola radio station sale proceeds
and discharged the Corporation of indebtedness totaling approximately $5
million.  The Corporation is in the process of dissolving this subsidiary with
all of its outstanding debt eliminated.

                                      3
<PAGE>

Principal Services
------------------

         The Corporation itself and through its subsidiary corporations is
principally engaged in the ownership, operation and management of commercial
radio stations in the United States.  As of December 31, 1996, the Corporation
owned and operated six radio stations located in Albuquerque/Santa Fe, New
Mexico (KKSS-FM); Shreveport, Louisiana (KMJJ-FM); Bryan/College Station,
Texas (KKYS-FM); Abilene, Texas (KEAN-AM and FM); and Longview, Texas
(KYKX-FM).  A summary of information in chart form regarding each of the
Corporation's owned stations is set forth under "Item 2. Properties".

         On June 6, 1996, the Corporation entered into an Asset Purchase
Agreement with Foster Communications Company for the purchase of the
construction permit of KFXJ in Abilene, Texas.  The Federal Communications
Commission approved the transfer of the license for the construction permit to
the Corporation on September 25, 1996.  The Corporation is in the process of
obtaining a suitable site for a broadcast tower and constructing a new radio
broadcast studio at its current facilities at KEAN in Abilene.  The new
station was placed in operation during 1996.

Company Strategy
----------------

         Because of the Corporation's financial difficulty over the past five
(5) years, it is focusing its operations in the media markets where it is now
positioned.  The Corporation desires to develop a strong profit base with its
current stations and continue its efforts to refinance and restructure the
Corporation's debt in order to enhance the financial stability of the
Corporation.

         In developing its radio stations, the Corporation has taken a variety
of actions to improve its radio stations' cash flow.  These actions include
cost control programs, implementation of numerous promotional activities,
performing internal and external programming reviews to improve the stations'
products in light of their respective target audiences, and enhancing total
station revenues through the development of alternative revenue sources such
as marketing the radio stations' current database of listeners.  The
Corporation has had each station implement a five year strategic business plan
and has developed a new internal control policy to implement within the
Corporation.  The Corporation has set up a structure in which the general
managers of the stations meet twice a year to focus on matters affecting the
industry and exchange ideas with the design of developing new ideas to
increase revenues in each of the five local markets.  The Corporation has also
implemented an annual meeting for its stations' sales managers to exchange
sales ideas and receive management training.  The Corporation has implemented
a company-wide interview process on sales recruiting.  It has also started to
focus on non-traditional revenue sources for its radio stations (database
telemarketing, etc.).

         The Corporation continues to focus on the latest technology available
to it.  The Corporation has created an Intranet System and each station is on
the Internet.

                                      4
<PAGE>

         In operating its radio stations, the Corporation concentrates on the
development of strong, decentralized, local management at the station level
which is responsible for the day to day operations of that station and is
compensated based upon the station's financial performance.  Local management
consists of a general manager, sales manager, operations/program director,
engineer, and business manager.  Local management, in cooperation with the
Corporation's management, is responsible for programming and sales. Corporate
management is responsible for long-range planning, establishing company-wide
policies and procedures, allocating resources and maintaining overall control
of the stations.

Programming Formats and Structure
---------------------------------

         Each of the Corporation's radio stations has adopted a programming
format designed to competitively fulfill the needs and tastes of its community
and to provide a public service.  In order to compete effectively, each
station seeks to develop a defined group, or target audience, within the total
potential listenership.  The format and target audience create each station's
identity and are the determinants of program selection, promotional campaigns,
on-air personnel, and other programming factors.  See "Item 2. Properties" for
more information on station programming formats.

         Some of the Corporation's radio stations are affiliated with one of
the national networks.  Each such affiliation provides non-local news, feature
segments and programming services.  Network affiliation is significantly less
important in the radio segment of the broadcasting industry (as opposed to the
television segment).  Therefore, radio network affiliations and revenues are
not of major significance to the Corporation.

         At most of the Corporation's radio stations, with the exception of
network news and other network programming, the staff of each station
originates, prepares and presents substantially all of the station's non-music
programming.  Each station has one or more studios for production and
recording of material for later airing or from which live programming can be
broadcast.

Revenues and Competition
------------------------

         The Corporation's radio stations principally derive their revenues
from local advertising, national advertising, and activities tied to the radio
station.  The local sales staff of each station is responsible for servicing
the needs of advertising clients located in the community in which it is
located.  Sales to national advertisers are arranged primarily by a sales
representation firm.  Using a network of offices in important cities, this
national firm employs its best efforts to exclusively secure national
advertising for the station under a contractual agreement.  The sales
representation firm receives compensation in the form of commissions on net
revenue produced for each station from advertising solicited and sold
nationally.

         Advertising rates charged by a radio station are based upon market
analysis of radio advertising results, competitive factors, added value
promotions, and competitive pricing in the marketplace.  Success in developing
programming with broad popular appeal, particularly among

                                      5
<PAGE>

those segments of the listening audience most sought after by advertisers, and
the ability of a sales staff to communicate the advantages of their radio
station's product, are the major competitive variables of revenues.  The
future performance of each of the Corporation's radio stations will also
depend upon a number of external factors, including the general strength of
the local and national economy, population growth, overall advertising
revenues, retail sales trends, relative efficiency compared to other media and
future governmental regulation and policies.

         The Corporation's radio stations compete for revenues with other
media outlets in their respective areas.  In addition to rival radio stations
in all of the Corporation's markets duopolies have been formed which create a
new and more formidable type of competitor.  Recently, FCC regulations
regarding local radio station ownership have been relaxed (see "FCC
Regulations").  This change will have a significant impact on both the
Corporation and its competitors.  Other sources of competition for advertising
expenditures include television and cable television, newspapers, magazines,
billboards, direct mail, and many local creative advertising sources.

         Management believes that the Corporation's radio stations are
generally focused on achieving their competitive goals as measured by overall
ratings and target audience performance, advertiser appeal and establishment
of clear, positive, local market identity.  Because of the volatile nature of
radio competition and ever-changing listening audience tastes, maintenance of
the Corporation's current market standings entails risk and is subject to
competitive pressures.  Because of a lack of funds, the Corporation does not
have the same ability as better financed stations to protect its format and
market position or to acquire additional stations within the market to enhance
its position.  However, the Corporation recently acquired the right to build a
new FM station in Abilene, Texas and has recently had and is involved in
ongoing discussions with several other radio stations with regards to
expanding its coverage in its current markets through operating and purchasing
additional and new stations.

Seasonality
-----------

         Advertising expenditures in the radio industry generally tend to
follow overall retail sales seasonal patterns, but expenditures vary by
programming format.  Typically, sales are strongest during the fourth quarter
and weakest in the first quarter of the calendar year.  The Corporation
continues to work on ways to eliminate the seasonal variations of its revenue.

FCC Regulations
---------------

         The Corporation's radio broadcasting operations are subject to the
jurisdiction of the FCC under the Communications Act of 1934, as amended.  FCC
regulations govern issuance, term, renewal and transfer of licenses necessary
for operation of radio stations.  Upon application, and in the absence of
conflicting applications (which would require the FCC to hold a hearing) or
adverse findings as to the licensee's qualifications, existing radio licenses
will be renewed without hearing for additional seven year terms.  All of the
Corporation's radio stations are currently licensed under regular renewal
authorizations, with the exception of KMJJ-FM in Shreveport.  On February 1,
1996, the Corporation filed under normal circumstances a license renewal

                                      6
<PAGE>

application for radio station KMJJ-FM.  KMJJ's license expired on June 1,
1996.  Although the application has been outstanding for sometime, there is no
indication at the present time that the FCC will not grant the requested
license extension.

         On February 8, 1996, President Clinton signed into law the
Telecommunications Act of 1996.  This law will have a significant impact on
the radio industry.  First, the law eliminates the restrictions on the number
of AM and FM stations which may be owned or controlled nationally by one
entity.  Previously, the law restricted ownership or control by one entity to
no more than 20 AM and 20 FM stations nationally.  Second, the local radio
station ownership rules were changed to be based upon the number of stations
controlled by an entity, not its market share.  The number of stations an
entity can control in a market depends upon the number of signals in the
market, but the number of stations which can now be owned by one entity is
significantly greater than in the past.

         The statements above do not purport to be a complete summary of the
Communications Act of 1934, as amended, and the rules and regulations of the
FCC or of pending proposals.  For a complete statement, reference is made to
the Communications Act, the Telecommunications Act of 1996, and to any related
rules, regulations and proposals.

         Below is a table of the Corporation's radio stations and the current
expiration date of each station's FCC authorization:


   STATION                                   EXPIRATION DATE
   -----------------------------------------------------------------------
   KEAN-AM/FM - Abilene                      October 1, 1997
   KKYS-FM - Bryan/College Station           October 1, 1997

   KMJJ-FM - Shreveport                      June 1, 1996 (in application)
   KKSS-RM - Albuquerque/Santa Fe            August 1, 1997
   KYKX-FM- Longview                         October 1, 1997
   KFXJ-FM - Abilene                         September 26, 1997

Employees
---------

         The Corporation had 83 full-time and 117 total employees as of
December 31, 1996.  Each station normally employs an average of fifteen to
twenty-five people.  The Corporation's staff consists of three employees.  The
Corporation considers relations with its employees to be good.

                                      7
<PAGE>
                       ITEM 2:  DESCRIPTION OF PROPERTY
<TABLE>
<CAPTION>


                                                                                                       Tower Lease    Office Lease
Station/Location                      Date Acquired    Frequency   Licensed Power       Format        Expiration       Expiration
----------------------------------------------------------------------------------------------------------------------------------
<S>                                        <C>          <C>         <C>              <C>                 <C>              <C>
KKSS-FM Albuquerque/ Santa Fe, New         1986         97.3 MHZ    100,000 watts    Contemporary        2002             1999
Mexico

KEAN-AM Abilene, Texas                     1985         1280 KHz        500 watts      Country            Own             2000

KEAN-FM Abilene, Texas                     1985        105.1 MHZ    100,000 watts      Country           1999             2000

KYKX-FM Longview, Texas                    1985        105.7 MHZ    100,000 watts      Country           2017             Own

KKYS-FM Bryan/College Station, Texas       1989        104.9 MHZ     50,000 watts    Contemporary         Own             1996

KMJJ-FM Shreveport, Louisiana              1989         99.7 MHZ     50,000 watts       Urban            2013             Own

KFXJ-FM Abilene, Texas                     1996         92.5 MHZ     50,000 watts      Country        In Process          Own


</TABLE>


                                      8
<PAGE>
Item 2.  Description of Property

         None of the Corporation's individual properties amounts to ten
percent or more of its total assets. All of the real estate owned by the
Corporation is subject to several mortgages.

         The ownership or leasing of tower space by which the Corporation
broadcasts its radio signal is critical to the Corporation.  The Corporation's
management believes that its current tower leases are adequate for its
existing operations.

         In December, 1996, the Corporation moved its headquarters from
Indianapolis, Indiana to Sarasota, Florida.  The Corporation leases
approximately 2,100 square feet of office space in Sarasota under a lease
expiring in December, 2001.  The Corporation's subsidiaries typically operate
in approximately 3,000-4,000 square feet of office space.

         The Corporation does not invest in real estate other than to own or
lease office space or towers for radio operating purposes.  The Corporation
does not own securities in any company involved in real estate activities.

         Management believes that there is adequate insurance coverage on its
property and equipment.

Item 3.  Legal Proceedings

         The Corporation in the normal course of business is a defendant in a
small number of routine lawsuits.  Management believes that the results of any
such litigation will not have an material adverse effect upon the conduct of
the Corporation's business or its financial position.

Item 4.  Submission of Matters to a Vote of Security Holders

         No matters were submitted to a vote of the Corporation's security
holders during the fourth quarter of 1996.

                                   PART II

Item 5.  Market for Common Equity and Related Stockholder Matters

         There is no active public trading market for the Corporation's common
stock, but it is traded on the over the counter market and has two market
makers.

         As of December 31, 1996, the Corporation had 495 shareholders of
record.

         The Corporation has not paid any cash dividends on its common shares
in the last six years and does not expect to pay dividends in the foreseeable
future.  Three of the Corporation's subsidiaries are prohibited, pursuant to
loan agreements, from making distributions to the parent

                                      9
<PAGE>

and most of the Corporation's restructured debt payments are tied to the cash
flow of specific subsidiaries or the cash flow of the consolidated entity.
Lack of distributions to the Corporation as the parent company by its
subsidiaries and debt service payment requirements leave the Corporation with
inadequate cash to pay any cash dividends in the foreseeable future.

Item 6.  Management's Discussion and Analysis

Results of Operations:  1996 vs. 1995
-------------------------------------

         For the years ended December 31, 1996 and 1995, the Corporation
operated the same properties, except for WOWW-FM in Pensacola.  Gross revenues
for 1996 were down $48,616 or .5% from 1995.  This decrease is attributable to
the sale of the WOWW-FM radio station in Pensacola on July 2, 1996.  Excluding
the Pensacola station, revenues increased $281,569 or 3.43% from 1995 to 1996.
The increase is due to a larger portion of political advertisement sales and
slight increases in local and national advertising.  Miscellaneous and network
income was flat for 1996.

         Agency commissions as a percentage of gross sales were approximately
11.0% in 1996 versus 10.6% in 1995.  This increase is attributable to larger
amounts of political advertisements revenue which originates through agencies.

         Technical and programming expenses increased 3.05% in 1996 from 1995.
This increase is a result of higher music licensing fees.  The Corporation had
a small increase in the percentage royalty it must pay to various music
licensing agencies during 1996 and this percentage is applied directly to the
Corporation's level of sales.  Therefore, an increase in sales will increase
this expense commensurately.

         Selling, general and administrative expenses, which includes
depreciation and amortization, decreased $357,000 in 1996 from 1995.  This
decrease is attributable to the sale of the Pensacola station and a decrease
in depreciation expense as assets become fully depreciated in 1996.

         Gain on the disposal of assets is a result of the sale of the WOWW
radio station in Pensacola.  The gain on this transaction was $645,730.  The
Corporation recorded a loss of $5,375 on the disposal of other assets in the
ordinary course of business.

         Interest expense decreased 52.7% in 1996.  This was a result of the
sale of the Pensacola station and its subsequent debt elimination and the
related debt interest expense which was also eliminated.

         The Corporation also recorded other income of $864,450.  This income
is for receipt of the new broadcasting tower and related equipment from
Service Broadcasting Corporation at the Corporation's Longview, Texas station.

                                      10
<PAGE>

         In 1996, other income (expense) consisted of interest income and
other miscellaneous items.  The Corporation recorded $190,000 in miscellaneous
income, which is comprised of $120,000 from the settlement of an Alabama
payroll tax claim, $60,000 for refinancing the prior Wichita station sale and
$10,000 in interest income.

         The Corporation recorded approximately $9,307,700 in gains from debt
extinguishment during 1996. This gain was attributable to the settlement with
the FDIC at the time of the sale of the Pensacola radio station and the
write-off of several notes whose Statute of Limitations had expired.  In 1996,
the Corporation recorded gains from debt extinguishment in the amount of
$180,285.

         The Corporation recognized $972,071 of income tax expense on income
before the extraordinary gain.  This is due to the Corporation reflecting
income before tax of $2,169,300 in the current year compared to a loss of
$71,972 in the prior year.  There is also $729,600 of taxes allocated to the
extraordinary gain.

Liquidity and Capital Resources
-------------------------------

         The Corporation's principal source of funds is cash flow provided by
the operation of its radio stations.  Its primary needs include working
capital, capital expenditures to maintain property, plant, and equipment, and
repayment of debt.  During 1996, the Corporation generated sufficient funds
for working capital, scheduled debt repayment and capital expenditures.  In
1996, the Corporation generated approximately $1.33 million in cash before
debt service and capital expenditures.  This compares to $916,000 in 1995.
The cash flow from operating activities for 1996 was generated from the
operating revenue of the Corporation.

         In 1997, the Corporation expects to spend $150,000 on capital
expenditures and currently has debt payments of approximately $2,898,000 on
its current restructured notes.

         On December 15, 1996, the Corporation reached agreement with First
Savings Bank, Arlington, Texas, ("FSB") to purchase one of the Corporation's
loans, which was to have matured on December 15, 1996.  The note has a
principal balance of $2,184,322 and has been renegotiated to mature on
December 15, 1997.  The note calls for monthly interest payments of $21,843.

         The Corporation plans to spend sufficient funds to maintain its
capital equipment in a competitive working condition.  However, these
expenditures are limited by the Corporation's lenders.  Such expenditures are
not anticipated to exceed average expenditures in previous years.  The
Corporation is committed to make its radio stations as technologically
competitive as possible in their markets, within the financial limits set by
its lenders.  Capital needs are expected to be paid from operating revenues as
they become available.

         The Corporation plans to deal with its weak financial condition by
continuing to develop a strong profit base with its current stations and
focusing on the restructuring of secured and unsecured debts.  The Corporation
continues to work with its secured lenders in order to

                                      11
<PAGE>

restructure its debt obligations in such a way that they can be paid out of
the net cash now being generated by the Corporation's broadcast properties.

         The Corporation has had success in the past in renegotiating with
creditors for extended payments. At present, the Corporation is generating
sufficient cash flow to meet its current obligations.  The Corporation has had
several discussions with lenders with regard to refinancing the total
outstanding obligations of the Corporation and continues to work and focus
these efforts on refinancing the total loan package.  However, without
restructuring of this debt, the Corporation's ability to meet future
obligations may be in jeopardy.

Item 7.  Financial Statements

         The information called for by this Item is included on pages 45
through 62 inclusive, of Exhibit 99 to this report on Form 10-KSB.

Item 8.  Changes in and Disagreements with Accountants on Accounting and
         Financial Disclosures

         None.

                                   PART III

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

         Listed below are the Directors of the Corporation as of December 31,
1996, their years of service as a Director, and ages:


         DIRECTOR         AGE       SERVICE AS DIRECTOR       TERM EXPIRES
-----------------------------------------------------------------------------
     John W. Biddinger     56     August, 1984 - Present            2000

     James M. Elliott      54     November, 1984 - Present          1997

     Dan E. Young          67     December, 1985 - Present          1997

         Biographical information concerning Mr. Biddinger is set forth below
under the caption "Executive Officers".

         James M. Elliott has been President of Elliott and Associates, an
investment advisor and investment manager, since 1991.  Prior thereto, he was
Vice President and Chief Financial Officer of the Indiana University
Foundation.

                                      12
<PAGE>

         Dan E. Young has been President of Young Investments, Inc. since
1979.  He has been active in the ownership and management of automobile
franchise operations and is a multi-dealership owner.

Executive Officers
------------------

         Listed below are the Executive Officers of the Corporation as of
December 31, 1996, their positions, offices and ages:


   Officer                Age     Position
-----------------------------------------------------------------------------
   John W. Biddinger      56      President

   James A. Hoetger       43      Vice President, Treasurer and Secretary

         John W. Biddinger was elected President on May 24, 1991, and had been
Chairman of the Executive Committee of the Corporation since 1984.  Mr.
Biddinger is also President and a Director of Biddinger Investment Capital
Corporation, a leverage buy-out and workout specialist firm.

         James A. Hoetger became Vice President/Finance and Chief Financial
Officer of the Corporation in September, 1996, replacing John Southwood, Jr.,
who resigned to pursue other interests.  Previously, he was Vice President and
Corporate Controller of Tak Communications, Inc., Madison, Wisconsin, and was
responsible for all accounting and certain collection functions.

Term of Office
--------------

         The executive officers and Directors of the Corporation serve annual
terms or until their successors are duly elected and qualified.

Indemnification
---------------

         The Corporation's By-Laws provides for the indemnification of any and
all of its directors and/or officers.  The By-Laws require the Corporation to
indemnify the covered individuals for liabilities incurred by them because of
any act or omission, or neglect or breach of duty, committed while acting in
the capacity as an officer or director of the Corporation to the fullest
extent permitted by law.  Certain actions, including acts for which
indemnification is found by a court to be illegal or contrary to public policy
are excluded from such coverage.

Compliance With Section 16(a) of the Exchange Act
-------------------------------------------------

         Section 16(a) of the Securities Exchange Act of 1934, as amended,
requires the Corporation's directors, executive officers and persons who own
more than ten percent of the Corporation's common stock to file with the
Securities and Exchange Commission initial reports

                                      13
<PAGE>

of ownership and reports of changes in ownership of common stock of the
Corporation.  Officers, directors and greater than ten percent shareholders
are required by the Securities and Exchange Commission regulations to furnish
the Corporation with copies of all Section 16(a) forms they file.

         Specific due dates for these reports have been established, and the
Corporation is required to disclose in this report any failure to file such
forms by these dates during 1996.  To the Corporation's knowledge, based
solely on review of the copies of such reports furnished to the Corporation
and written representations that no other reports were required, with respect
to the fiscal year ended December 31, 1996, all Section 16(a) filing
requirements applicable to the Company's officers, directors and greater than
ten percent shareholders were complied with.

Item 10.  Executive Compensation

         The following table summarizes the compensation paid by the
Corporation to its current Chief Executive Officer, as of December 31, 1996,
for the past three fiscal years.  The Corporation had no other executive
officers at December 31, 1996 whose total annual salary and bonus from the
Corporation exceeded $100,000 during the past fiscal year.
<TABLE>
<CAPTION>
                                       SUMMARY COMPENSATION TABLE
                                            Annual Compensation
      -------------------------------------------------------------------------------------
      Name and Principal              Salary   Bonus      Other Annual         All Other
      Position               Year      ($)      ($)     Compensation ($)    Compensation(s)
      -------------------------------------------------------------------------------------
      <S>                    <C>     <C>         <C>           <C>                 <C>
      John W. Biddinger,     1996    132,200     0             0                   0
      CEO                    1995    132,200     0             0                   0
                             1994    132,200     0             0                   0
</TABLE>

Compensation of Directors
-------------------------

         Members of the Board of Directors who are not officers of the
Corporation receive $1,000 per meeting for their attendance at regularly
scheduled Board meeting.  There were four such meetings in 1996.  Messrs.
Elliott and Young attended all such meetings.

Board Committees
----------------

         The Corporation's Compensation Committee consists of Mr. Elliott.
The duties of this Committee are to review the compensation of the
Corporation's executive officers.  The Corporation has no audit or nominating
committee.

Employment Agreements
---------------------

                                      14
<PAGE>

         The Corporation entered into a three year employment agreement with
John W. Biddinger effective in 1991.  This agreement has been extended through
May 31, 2000.  The agreement calls for a minimum annual compensation of
$125,000 and annual bonuses of up to 50% of annual salary.  The agreement
calls for Mr. Biddinger to receive 24 months of annual compensation should he
be dismissed without cause or if there is a change in control of the
Corporation (as defined in the agreement).

         The agreement provides for a death benefit to Mr. Biddinger's estate
of two and one half times the current annual base salary and a lump sum
payment equal to two times the current annual base salary if he should become
permanently disabled (as defined in the agreement).  The Corporation is not
insured against either of these events.  The agreement also grants Mr.
Biddinger the option to "put" all of his stock back to the Corporation at a
mutually agreed upon fair market value (as defined in the agreement).

         Mr. Biddinger has agreed in restructuring part of the Corporation's
debt to hold his compensation at $132,200 per year.

Item 11.  Security Ownership of Certain Beneficial Owners and Management

         The following tables set forth information as of December 31, 1996,
as to the beneficial ownership, direct or indirect, of the Corporation's
common stock by all Directors, all current Directors and Officers as a group,
and all persons known by the Corporation to own beneficially more than 5% of
the Corporation's common stock.

         The aggregate percentage of ownership is based on 6,543,700 shares of
common stock outstanding and all exercisable options and warrants related to
individuals listed in the tables.









                                      15
<PAGE>

                           OWNERSHIP BY MANAGEMENT
                      OF THE CORPORATION'S COMMON STOCK

<TABLE>
<CAPTION>

                                       Amount and Nature of Beneficial
Name and Address                                Ownership (1)                 Percent of Class (2)
----------------                       -------------------------------        --------------------
<S>                                               <C>                                <C>
John W. Biddinger                                 2,420,056                          37.0%
7491 Albert Tillinghast Drive
Sarasota, FL  34240

James M. Elliott                                    20,000                            .3%
230 Fountain Square
Bloomington, IN 47404

Dan E. Young (3)                                   626,179                            9.6%
3210 E. 96th Street

All Present Directors and Executive               3,116,435                          47.6%
Officers as a Group (4 persons)

                                           FIVE PERCENT SHAREHOLDERS
                                       OF THE CORPORATION'S COMMON STOCK

                                       Amount and Nature of Beneficial
 Name and Address                               Ownership (1)                 Percent of Class (2)
 ----------------                      -------------------------------        ----------------
 John W. Biddinger                                2,420,056                          37.0%
 7491 Albert Tillinghast Drive
 Sarasota, FL  34240

 Conseco, Inc. (3)                                5,972,060                          47.7%
 11825 N. Pennsylvania Street
 Carmel, Indiana  46032

 Radio USA, Ltd.                                  1,913,007                          29.7%
 601 Jefferson Street
 Houston, Texas  77002
 Dan E. Young (3)                                  626,179                            9.6%
 3210 East 96th Street
 Indianapolis, Indiana

</TABLE>








                                      16
<PAGE>

(1)      All shares are held directly unless otherwise noted.

(2)      Pursuant to applicable Securities and Exchange Commission rules, a
         person is deemed beneficial owner of those shares not outstanding
         which are subject to options, warrants, rights or conversion
         privileges if that person can exercise such options, warrants, rights
         or privileges within 60 days. Any such shares are deemed to be
         outstanding for the purpose of computing the percentage of
         outstanding common stock owned by such person individually, but are
         not deemed to be outstanding for the purpose of computing the
         percentage ownership of any other person.

(3)      The Corporation has issued the following warrants to purchase shares
         of its common stock:

         Conseco, Inc.             5,972,060
         Dan Young, IRA              304,803

         All of the warrants for Dan Young, IRA are exercisable for $.11 (in
         total, not per share), and all of the warrants for Conseco are
         exercisable for $1.00 (in total, not per share), are presently
         exercisable, and terminate if not previously exercised by February
         15, 2003.

Potential Change in Control
---------------------------

         As outlined in Footnote 2, Conseco, Inc. holds exercisable warrants
for 5,972,060 shares at a total exercise price of $1.00.  If these warrants
were exercised, Conseco would control 45.9% of the Corporation's common stock
on a fully diluted basis.  The warrants expire on February 15, 2003 and are
nontransferable until February 15, 1997.  If by February 15, 1998, certain
restructured notes owed to Conseco are not repaid, it will receive additional
warrants for 10% of the Corporation's common stock on a fully diluted basis.

Item 12.  Certain Relationships and Related Transactions

         There are no reportable events under this item.






                                      17
<PAGE>

Item 13.  Exhibits and Reports on Form 8-K

         (a)     Exhibits:

Exhibit No            Description of Exhibit
-----------           ----------------------
     3                (i)     Articles of Incorporation(1)
                      (ii)    By-Laws as presently in effect(1)

    10                Material Contracts

                      (a)     Reinstatement, modification, renewal and
                      extension agreement between SunGroup, Inc. and Kenneth
                      R. Reynolds in the amount of $2,500,000.(2)

                      (b)     Reinstatement, modification, renewal and
                      extension agreement between SunGroup, Inc. and Arden
                      Wilson Osburn in the amount of $1,250,000.(2)

                     (c)     Reinstatement, modification, renewal and
                     extension agreement between SunGroup, Inc. and John D.
                     Osburn in the amount of $1,250,000.(2)

                     (d)     Promissory Note for $880,000 between SunGroup,
                     Inc. and Bankers National Life Insurance Company with
                     related warrant A-1 for 592,875 shares.(2)


                     (e)     Promissory Note for $4,000,000 between SunGroup,
                     Inc. and Western National Life Insurance Company with
                     related warrant A-2 for 2,892,000 shares.(2)

                     (f)     Promissory Note for $93,333.06 between SunGroup,
                     Inc. and John W. Biddinger with a related warrant A-3
                     for 59,287 shares.(2)

                     (g)     Promissory Note for $124,469.18 between SunGroup,
                     Inc. and Robert A. Davies and related warrant A-4 for
                     81,575 shares.(2)


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

(1) Incorporated by reference to the Corporation's Annual Report on Form 10-K
    for the year ended December 31, 1984.

(2) Incorporated by reference to the Corporation's Annual Report on Form 10-K
    for the year ended December 31, 1992.

                                      18
<PAGE>

                     (h)     Promissory Note for $176,800 between SunGroup,
                     Inc. and Indiana University Foundation with related
                     warrant A-5 for 118,575 shares.(2)

                     (i)     Promissory Note for $265,200 between SunGroup,
                     Inc. and Dan E. Young - IRA Trust with related warrant
                     A-6 for 177,862 shares.(2)

                     (j)     Agreement by and among RadioSunGroup of
                     Bryan/College Station, Inc., SunGroup Broadcasting of
                     Louisiana, Inc., SunGroup, Inc. and Radio USA, Ltd.
                     regarding exchange of common stock for debt.(3)

                     (k)     Second Amended and Restate Promissory Note dated
                     September 30, 1993 executed by RadioSunGroup of
                     Bryan/College Station, Inc. ("RSG") and SunGroup
                     Broadcasting of Louisiana, Inc. ("SGBL"), payable to the
                     order of the Federal Deposit Insurance Corporation
                     ("FDIC") in the original principal amount of
                     $2,205,509.02 and its related First Amendment to
                     Assumption Agreement and Amended and Restated Loan
                     Agreement dated September 30, 1993.(3)

                     (l)     Adjustment letter related to warrant A-1 issued
                     to Bankers National Life Insurance Company in the
                     original amount of 592,875 shares amended to 1,016,010
                     shares.(3)

                     (m)     Adjustment letter related to warrant A-2 issued
                     to Western National Lie Insurance Company in the
                     original amount of 2,892,000 shares amended to 4,956,050
                     shares.(3)

                     (n)     Adjustment letter related to warrant A-4 issued
                     to Robert N.Davies in the original amount of 81,575
                     shares amended to 139,797 shares.(3)

                     (o)     Adjustment letter related to warrant A-5 issued
                     to IU Foundation in the original amount of 118,575
                     shares amended to 203,202 shares.(3)

                     (p)     Adjustment letter related to warrant A-6 issued
                     to Dan Young IRA in the original amount of 177,862
                     shares amended to 304,803.(3)

                     (q)     Employment agreement with John W. Biddinger,
                     President.(3)

                     (r)     Amendment number one to the John W. Biddinger
                     Employment Agreement.(3)


---------------------
(3) Incorporated by reference to the Corporation's Annual Report on Form
    10-KSB for the year ended December 31, 1993.

                                      19
<PAGE>
                     (s)     Amendment number two to the John W. Biddinger
                     Employment Agreement.


                     (t)     Key Employee Incentive Stock Plan of 1986.(4)

                     (u)     Act of Loan Modification and Acknowledgment by
                     RadioSunGroup of Bryan/College Station, Inc., SunGroup
                     Broadcasting of Louisiana, Inc. and SunGroup, Inc. in
                     favor of First Savings Bank of Arlington, Texas.


    21               Subsidiaries of the Registrant

    27               Financial Data Schedule

    99               Financial Statements

            (b)      No Reports on Form 8-K were filed during the last quarter
                     of 1996.



---------------------
(4) Incorporated by reference to the Corporation's Annual Report on Form 10-K
    for the year ended December 31, 1986.


                                      20
<PAGE>
                                  SIGNATURES

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

                                  SUNGROUP, INC.

DATED:   March 27, 1997           By: /s/ John W. Biddinger
         Sarasota, Florida            ------------------------------------
                                      John W. Biddinger, President

         In accordance of the Exchange Act, this report has been signed below
by the following persons on behalf of the Registrant and in the capacities and
on the dates indicated.

DATED:   March 27, 1997           /s/ John W. Biddinger
                                  ----------------------------------------
                                  John W. Biddinger, Director and
                                  (Principal Executive Officer)

DATED:   March 27, 1997           /s/ James M. Elliott
                                  ----------------------------------------
                                 James M. Elliott, Director

DATED:   March 27, 1997           /s/ James A. Hoetger
                                  ----------------------------------------
                                 James A. Hoetger, Treasurer, Secretary
                                 and Vice President
                                 (Principal Accounting/Financial Officer)

DATED:   March 27, 1997           /s/ Dan E. Young
                                  ----------------------------------------
                                  Dan E. Young, Director




                                      21
<PAGE>

                              INDEX OF EXHIBITS

Exhibit No.      Description of Exhibit                               Page No.

    3           (i)     Articles of Incorporation(1)                    N/A
                (ii)    By-Laws as presently in effect(1)

   10            Material Contracts

                 (a)     Reinstatement, modification, renewal and       N/A
                 extension agreement between SunGroup, Inc. and
                 Kenneth R. Reynolds in the amount of $2,500,000.(2)

                 (b)     Reinstatement, modification, renewal and       N/A
                 extension agreement between SunGroup, Inc. and Arden
                 Wilson Osburn in the amount of $1,250,000.(2)

                 (c)     Reinstatement, modification, renewal and       N/A
                 extension agreement between SunGroup, Inc. and John
                 D. Osburn in the amount of $1,250,000.(2)

                 (d)     Promissory Note for $880,000 between           N/A
                 SunGroup, Inc. and Bankers National Life Insurance
                 Company with related warrant A-1 for 592,875
                 shares.(2)

                 (e)     Promissory Note for $4,000,000 between         N/A
                 SunGroup, Inc. and Western National Life Insurance
                 Company with related warrant A-2 for 2,892,000
                 shares.(2)

                 (f)     Promissory Note for $93,333.06 between         N/A
                 SunGroup, Inc. and John W. Biddinger with a related
                 warrant A-3 for 59,287 shares.(2)

                 (g)     Promissory Note for $124,469.18 between        N/A
                 SunGroup, Inc. and Robert A. Davies and related
                 warrant A-4 for 81,575 shares.(2)

----------------------
(1) Incorporated by reference to the Corporation's Annual Report on
    Form 10-K for the year ended December 31, 1984.

(2) Incorporated by reference to the Corporation's Annual Report on
    Form 10-K for the year ended December 31, 1992.

                                  22
<PAGE>

                 (h)     Promissory Note for $176,800 between           N/A
                 SunGroup, Inc. and Indiana University Foundation
                 with related warrant A-5 for 118,575 shares.(2)

                 (i)     Promissory Note for $265,200 between           N/A
                 SunGroup, Inc. and Dan E. Young - IRA Trust with
                 related warrant A-6 for 177,862 shares.(2)

                 (j)     Agreement by and among RadioSunGroup of        N/A
                 Bryan/ College Station, Inc., SunGroup Broadcasting
                 of Louisiana, Inc., SunGroup, Inc. and Radio USA,
                 Ltd. regarding exchange of common stock for debt.(3)

                 (k)     Second Amended and Restate Promissory Note     N/A
                 dated September 30, 1993 executed by RadioSunGroup of
                 Bryan/College Station, Inc. ("RSG") and SunGroup
                 Broadcasting of Louisiana, Inc. ("SGBL"), payable to
                 the order of the Federal Deposit Insurance
                 Corporation ("FDIC") in the original principal amount
                 of $2,205,509.02 and its related First Amendment to
                 Assumption Agreement and Amended and Restated Loan
                 Agreement dated September 30, 1993.(3)

                 (l)     Adjustment letter related to warrant A-1       N/A
                 issued to Bankers National Life Insurance Company in
                 the original amount of 592,875 shares amended to
                 1,016,010 shares.(3)

                 (m)     Adjustment letter related to warrant A-2       N/A
                 issued to Western National Lie Insurance Company in
                 the original amount of 2,892,000 shares amended to
                 4,956,050 shares.(3)

                 (n)     Adjustment letter related to warrant A-4       N/A
                 issued to Robert N. Davies in the original amount of
                 81,575 shares amended to 139,797 shares.(3)

                 (o)     Adjustment letter related to warrant A-5       N/A
                 issued to IU Foundation in the original amount of
                 118,575 shares amended to 203,202 shares.(3)

                 (p)     Adjustment letter related to warrant A-6       N/A
                 issued to Dan Young IRA in the original amount of
                 177,862 shares amended to 304,803.(3)


----------------------
(3) Incorporated by reference to the Corporation's Annual Report on
    Form 10-KSB for the year ended December 31, 1993.

                                  23
<PAGE>

                  (q)     Employment agreement with John W. Biddinger,  N/A
                  President.(3)

                  (r)     Amendment number one to the John W.           N/A
                  Biddinger Employment Agreement.(3)

                  (s)     Amendment number two to the John W.            25
                  Biddinger Employment Agreement.

                  (t)     Key Employee Incentive Stock Plan             N/A
                  of 1986.(4)

                  (u)     Act of Loan Modification and Acknowledgment    26
                  by RadioSunGroup of Bryan/College Station, Inc.,
                  SunGroup Broadcasting of Louisiana, Inc. and
                  SunGroup, Inc. in favor of First Savings Bank of
                  Arlington, Texas.

         21               Subsidiaries of the Registrant                 44

         27               Financial Data Schedule

         99               Financial Statements                           45






----------------------
(4) Incorporated by reference to the Corporation's Annual Report on
    Form 10-K for the year ended December 31, 1986.

                                  24