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,
                  1998.

Commission file number:  0-3851
                        --------

                                 SUNGROUP, INC.
                 ----------------------------------------------
                 (Name of small business issuer in its charter)

       Tennessee                                               62-0790469
-----------------------------------------------------------------------------
(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.  $5,228,602.

As of March 11, 1999, 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 11, 1999, there were 6,988,300 Common Shares outstanding.

Transitional Small Business Disclosure Format. (Check One):   Yes     No  X
                                                                  ---    ---
                                     Page 1
                                                      Exhibit Index on Page 19

<PAGE>

                               TABLE OF CONTENTS

Item                                                                   Page
----                                                                   ----

PART I
------

1    Description of Business                                             3

2    Description of Property                                             6

3    Legal Proceedings                                                   7

4    Submission of Matters to a Vote of Security Holders                 7

PART II

5    Market for Common Equity and Related
     Stockholder Matters                                                 8

6    Management's Discussion and Analysis                                8

7    Financial Statements                                                10

8    Changes in and Disagreements with Accountants on
     Accounting and Financial Disclosure                                 10

PART III

9    Directors, Executive Officers, Promoters and Control
     Persons; Compliance with Section 16(a) of the Exchange Act          10

10   Executive Compensation                                              12

11   Security Ownership of Certain Beneficial Owners and Management      13

12   Certain Relationships and Related Transactions                      14

13   Exhibits and Reports on Form 8-K                                    15

     Signatures                                                          18

     Index to Exhibits                                                   19

                                       4
<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.

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
and loan restructurings.

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
dissolved this subsidiary with all of its outstanding debt in 1997.

         The Corporation's principal source of funds is cash flow provided by
the operation of its subsidiary radio stations. Its primary needs include
working capital, capital expenditures, maintenance of property, plant, and
equipment, repayment of debt and interest. During the twelve months of 1998, the
Corporation was able to meet its primary cash need of debt service

                                       5
<PAGE>

and interest expense.

         On February 3, 1998 the Corporation entered into an Asset Purchase
Agreement with Sunburst Media of Dallas, Texas to sell substantially all the
assets of the Corporation for $24,000,000.00. The Corporation will retain its
cash and accounts receivable. It is anticipated that the net proceeds, after
payment of the Corporation's outstanding debt obligations and tax liabilities,
will be distributed and the Corporation liquidated after all affairs are wound
up. The sale is contingent upon, among other conditions, consent by the Federal
Communications Commissions to the assignment of the various broadcast licenses
from SunGroup, Inc. to Sunburst Media.

         Subsequently, the Corporation entered into a Local Management Agreement
with Sunburst Media for the operation of its stations in Abilene, Longview and
Bryan College Station, Texas effective April 1, 1998. The Corporation believes
this agreement was in the best interest of its stockholders and would expedite
the Asset Purchase Agreement previously entered into.

         As a condition of the asset sale of the Corporation, the Corporation is
obligated to pay its various note holders. For the Corporation to be is a
position to sell it assets, it had to negotiate a settlement with it largest
equity holder, via the warrants, and it largest note holder, Conseco Risk
Management for $10,300,000.00. Payment is due Conseco on July 23, 1998. If the
settlement does not occur on that date, interest will accrue at the rate of 18%
per annum.

         The Corporation completed the sale of its subsidiary SunGroup
Broadcasting of Louisiana, Inc. Radio Station KMJJ to Capstar Broadcasting of
Austin, Texas via Sunburst Media on October 14, 1998. Proceeds of the sale were
used to pay off the debt to First Savings Bank of Arlington, and the balance was
applied to the Conseco settlement mentioned above.

         On October 27, 1998, the Corporation consummated the sale of its
subsidiaries Radio SunGroup of Texas, Inc. and Radio SunGroup of Bryan/College
Station, Inc to Sunburst Media LP. The proceeds were used to pay off the balance
of the Conseco settlement and other secured and unsecured note holders. The
remaining proceeds will be used to pay any taxes the Corporation may incur ,
legal and professional fees and for distribution to the shareholders.

         As part of the February 3, 1998 Asset Purchase Agreement with Sunburst
Media, LP the Corporation entered into a subsequent Asset Purchase Agreement
with Trumper Broadcasting to purchase its subsidiary SunGroup Broadcasting of
New Mexico, Inc. Trumper has withdrawn its offer to purchase this subsidiary and
the Corporation has found a new suitor in Simmons Broadcasting. An Asset
Purchase Agreement was sign with Simmons on October 13, 1998. The Simmons Asset
Purchase Agreement has been filed with the Federal Communications Commission
during the week of November 2nd, 1998 and it is expected that

                                       6
<PAGE>

it will be approved. In addition, the Corporation also entered into a Local
Marketing Agreement with Simmons Broadcasting on October 23, 1998 that went into
effect on November 1, 1998.

Company Strategy

         As a result of the sale of the Corporation's assets in 1998 and 1999,
the Corporation is in the process of liquidating the Corporation and making
distributions to the shareholders. It is anticipated that all distributions,
settlement of leases, and all legal proceedings including Dissolutions will be
completed by December 31, 1999.


                                       7
<PAGE>


                        ITEM 2: DESCRIPTION OF PROPERTY
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------------------------
Station/Location                Date Acquired   Frequency  Licensed Power      Format       Tower Lease   Office Lease    Date
                                                                                            Expiration     Expiration     Sold
---------------------------------------------------------------------------------------------------------------------------------
<S>                                  <C>        <C>         <C>             <C>                <C>            <C>       <C>
KKSS-FM Albuquerque/ Santa Fe,       1986       97.3 MHZ    100,000 watts   Contemporary       2002           1998       2/12/99
New Mexico
---------------------------------------------------------------------------------------------------------------------------------
KEAN-AM Abilene, Texas               1985       1280 KHz      500 watts        Country          Own           2000      10/27/98
---------------------------------------------------------------------------------------------------------------------------------
KEAN-FM Abilene, Texas               1985       105.1 MHZ   100,000 watts      Country         1999           2000      10/27/98
---------------------------------------------------------------------------------------------------------------------------------
KYKX-FM Longview, Texas              1985       105.7 MHZ   100,000 watts      Country         2017           Own       10/27/98
---------------------------------------------------------------------------------------------------------------------------------
KKYS-FM Bryan/College Station,       1989       104.9 MHZ      50,000       Contemporary        Own           2002      10/27/98
Texas                                                           watts
---------------------------------------------------------------------------------------------------------------------------------
KMJJ-FM Shreveport, Louisiana        1989       99.7 MHZ       50,000           Urban          2013           Own       10/14/98
                                                                watts
---------------------------------------------------------------------------------------------------------------------------------
KROW-FM Abilene, Texas               1996       92.5 MHZ       50,000       Contemporary        Own           Own       10/27/98
                                                                watts
---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
                                       8
<PAGE>

Item 2.  Description of Property

         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.

         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.

         Applications for the renewals of the licenses of stations KEAN(AM),
Abilene, Texas; KEAN-FM, Abilene, Texas; KYKX (FM), Longview, Texas; and KKYS
(FM) Bryan, Texas (the "Stations") were filed with the Federal Communications
Commission ("FCC") in March 1997. Those applications included information
regarding the Stations' respective Equal Employment Opportunity ("EEO")
programs. On August 1, 1997, the FCC formally requested additional information
concerning the Stations' EEO efforts. In response, the Stations submitted
additional EEO information to the FCC.

         On March 12, 1998, in response to an inquiry about the status of the
Stations' renewal applications, Paulette Laden, the Chief of the FCC's EEO
Branch, contacted the Corporation's legal counsel, at the law firm of Wiley,
Rein & Fielding by telephone. Ms. Laden advised our FCC counsel that based on
the responses provided by the Stations, she had determined that the Stations had
"serious" deficiencies with respect to their EEO recruitment efforts. Ms. Laden
advised that the EEO Branch is drafting a decision for review and disposition by
the full Commission. Ms. Laden did not provide any further details.

         Depending on the seriousness of the EEO program deficiencies that may
be found at one or more of the Stations, the range of remedies which may be
imposed by the Federal Communications Commission (FCC) include: (1) assessing
forfeitures against the licensees of one or more of the Stations; (2) granting
the renewals of one or more of the Stations' licenses subject to special EEO
reporting conditions; (3) granting the renewals of one or more of the Stations'
licenses for a short-term subject to such reporting conditions; (4) assessing
forfeitures and granting short-term renewals to one or more of the Stations as
described above; or (5) denying one or more of the requested renewals of the
Stations' licenses.

         The Federal Communications Commission, after a federal appeals court
ruling, reversed its position on its EEO policy. As a result of this decision,
all of the station licenses were renewed and have since been transferred to the
new owners of the stations.

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

                                       9
<PAGE>

fourth quarter of 1998.













                                       10
<PAGE>

                                    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, 1998, the Corporation had 495 shareholders of
record.


Item 6.  Management's Discussion and Analysis

Results of Operations:  1998 vs. 1997

         For the period ended December 31, 1998 and 1997, the Corporation
operated the same properties, except for KALK -FM in Mount Pleasant, Texas and
KROW-FM in Abilene Texas. The Corporation entered into a Local Marketing
Agreement (LMA) with KALK-FM in June 1997 and began operating KROW-FM on October
29, 1997. On April 1, 1998, the Corporation entered into an additional Local
Marketing Agreement with Sunburst Media of Dallas, Texas for its stations in
Abilene, Texas; Bryan, Texas: and Longview, Texas.

         Gross revenue for 1998 decreased 42.9% or $3,932,814 from 1997.

         Agency commissions as a percentage of gross sales for the year were
approximately 8.89% in 1998 versus 10.69% in 1997. The decrease is due to
decrease in national and political advertising which originate through agencies.

         Technical and programming expenses decreased 47% form the same period
of 1998 to 1997.

         Selling and administrative expenses, which include depreciation and
amortization, decreased $1,117,219 or 19.67.

         All of the decreases in Revenue, Technical, Programming, Sales and
Administrative expenses are due to the Local Marketing Agreements and subsequent
sale of the assets to Sunburst Media and Capstar Communications. Although the
Corporation received monthly income of $91,645.00 per month, this was
substantially lower than normal operating revenues of the stations. Under the
local marketing agreements, there is also a correlating decrease in expenses,
with most of the normal operating expenses paid by the operator of the stations.

         Interest expense increased 295.87% or $683,668. This is a result of
refinancing several zero interest bearing notes that became due December 31,
1997 with short term notes paying a 10% annual return and the settlement
agreement with Conseco, Inc, the Corporations largest note and equity holder, at
18% per annum until the sale of the Corporations assets was completed.

                                       11
<PAGE>

         The Corporation recorded gain on disposal of assets of $11,325,264 in
1998 as a result of the sale of several of its radio stations. There were no
dispositions in 1997.

         In May 1998, the Corporation sold its studio building in Longview,
Texas for $136,600. Proceeds from the sale were used to pay the mortgage due to
Longview Bank and Trust of Longview, Texas. The Corporation recognized a gain on
the sale of $70,200. The Corporation had no extraordinary items in 1997 or 1998.

         In the event that the Corporation does not complete its liquidation by
December 31, 1999, the Corporation is aware of the issues associated with the
programming code in existing computer systems as the Millennium (year 2000)
approaches. The "year 2000" problem is pervasive and complex as virtually every
computer operation will be affected in some way by the rollover of the two-digit
value to 00. The issue is whether computer systems will properly recognize data
sensitive information when the year changes to 2000. Systems that do not
properly recognize such information could generate erroneous data or cause a
system to fail. The Corporation will take steps in 1999 to contact the various
software suppliers it uses to correct the problem.

Liquidity and Capital Resources

         On December 15, 1997, the Corporation reached an agreement with First
Savings Bank, Arlington, Texas, ("FSB") to renew one of the Corporation's loans,
which was to have matured on December 15, 1997. The note has a principal balance
of $2,184,322 and has been renegotiated to mature on June 30, 1998. The note
calls for monthly interest payments of $21,843.

         The Corporation entered into a loan agreement with Young Investments on
December 24, 1997 in the amount of $800,000, with a 10% interest rate to be paid
monthly. The note expires June 30, 1998. Proceeds from the loan were used to
payoff the notes of James D. Osburn and Arden Osburn which matured on January 1,
1998. The payoffs for these two notes were made on January 2, 1998. In addition,
Kenneth R. Reynolds agreed to extend his note with the Corporation, which was to
mature on January 1, 1998, until June 30, 1998 at an interest rate of ten
percent (10%), with interest payments to be made monthly.

         On March 1, 1998, the Corporation entered into loan agreements with
John W. Biddinger; Margaret H. Biddinger; and Karen Biddinger in the aggregate
amount of $400,000. The notes are to mature on June 30, 1998 and carry a 10%
interest rate to be paid monthly. The proceeds were used to pay down the prior
note from Young Investments. Young Investments was issued a new note on March 1,
1998 for $400,000, maturing on June 30, 1998, bearing an interest rate of
ten-percent (10%), interest payable monthly.

         The Corporation had notes with several entities (see Exhibit #(ii)
attached) which

                                       12
<PAGE>

matured on February 15, 1998. All note-holders are aware of the Asset Purchase
Agreement (APA) with SunBurst Media for the sale of substantially all the assets
of the corporation.

         As a result of the closing with  Capstar  Broadcasting  on October 14,
1998 and SunBurst  Media on October 27, 1998 all of the aforementioned notes
were paid in full.



                                       13
<PAGE>


Item 7.  Financial Statements

         The information called for by this Item is included as Exhibit 99 to
this report.

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,
1998, their years of service as a Director, and ages:

------------------------------------------------------------------------
     Director          Age    Service as Director     Term Expires
------------------------------------------------------------------------
John W. Biddinger      58    August, 1984 - Present       2000
------------------------------------------------------------------------
James M. Elliott       56   November, 1984 - Present      1997
------------------------------------------------------------------------
Dan E. Young           69   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.

         Daniel 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, 1998, their positions, offices and ages:

---------------------------------------------------------------------------
         Officer                  Age       Position
---------------------------------------------------------------------------

                                       14
<PAGE>

         John W. Biddinger        58        President
---------------------------------------------------------------------------
         James A. Hoetger         45        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 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 1997. To the Corporation's knowledge, based solely
on review of the copies of such reports furnished to

                                       15
<PAGE>

the Corporation and written representations that no other reports were required,
with respect to the fiscal year ended December 31, 1997, all Section 16(a)
filing requirements applicable to the Company's officers, directors and greater
than ten percent shareholders were complied with.




                                       16
<PAGE>

Item 10.  Executive Compensation

         The following table summarizes the compensation paid by the Corporation
to its current Chief Executive Officer, as of December 31, 1998, for the past
three fiscal years. The Corporation had no other executive officers at December
31, 1998 whose total annual salary and bonus from the Corporation exceeded
$100,000 during the past fiscal year.


         SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
                                                      Annual Compensation
         --------------------------------------------------------------------------------------------------
         Name and Principal      Year    Salary ($)    Bonus       Other Annual           All Other
         Position                                       ($)       Compensation ($)      Compensation(s)
         --------------------------------------------------------------------------------------------------
         <S>                     <C>       <C>           <C>             <C>                   <C>
         John W. Biddinger, CEO  1998      132,200       0               0                     0
                                 1997      132,200       0               0                     0
                                 1996      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 no such meetings in 1998.

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

         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

                                       17
<PAGE>

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.

         The Corporation entered into an Employment Agreement with James A.
Hoetger on September 9, 1997. This Agreement is in effect through December 31,
1999. The Employment Agreement calls for annual compensation of $75,000 in 1998
and $80,000 in 1999 and bonuses based on merit and performance determined by the
President of the Corporation.

Item 11.  Security Ownership of Certain Beneficial Owners and Management

         The following tables set forth information as of December 31, 1997, 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.

                                               OWNERSHIP BY MANAGEMENT
                                          OF THE CORPORATION'S COMMON STOCK
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------
Name and Address                              Amount and Nature of Beneficial         Percent of Class (2)
----------------                              --------------------------------        --------------------
                                                       Ownership (1)
                                                       -------------
----------------------------------------------------------------------------------------------------------
<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                                              626,179                             9.6%
3210 E. 96th Street
----------------------------------------------------------------------------------------------------------
All Present Directors and Executive Officers             3,066,235                           46.9%
as a Group (3 persons)
----------------------------------------------------------------------------------------------------------
</TABLE>

                                       18
<PAGE>

                           FIVE PERCENT SHAREHOLDERS
                       OF THE CORPORATION'S COMMON STOCK
<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------
Name and Address                     Amount and Nature of Beneficial         Percent of Class (2)
----------------                     --------------------------------        --------------------
                                              Ownership (1)
                                              -------------
-------------------------------------------------------------------------------------------------
<S>                                             <C>                                 <C>
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
-------------------------------------------------------------------------------------------------
Antar & Co.                                     1,911,014                           29.2%
601 Jefferson Street
Houston, Texas  77002
-------------------------------------------------------------------------------------------------
Dan E. Young                                     626,179                             9.6%
3210 East 96th Street
Indianapolis, Indiana
-------------------------------------------------------------------------------------------------
</TABLE>
(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.

Item 12.  Certain Relationships and Related Transactions

         The Corporation,  through its subsidiary  RadioSunGroup of Texas,
entered into a Local Marketing Agreement with Mt. Pleasant Radio, Inc. for
KALK-FM in Mt. Pleasant on January  28,  1997,  effective  June 1, 1997.  As
part of the  agreement,  the  Corporation  also has the option to purchase all
of the assets of KALK-FM.

         In order for the Corporation to complete the construction permit for
KROW-FM in Abilene, Texas, the Corporation entered into a leasing contract with
SLT of Indiana, Inc. for broadcast equipment. The lease is for five-years,
beginning December 1, 1998.


                                       19
<PAGE>


Item 13.  Exhibits and Reports on Form 8-K
         (a)      Exhibits:
                  1        Asset Purchase Agreement (APA)
                  2        Press Release(s)
                  3        8K SunGroup Broadcasting of New Mexico, Inc.
                  4        February 16, 1999 Shareholder Letter

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.
                           (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)

--------
     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.

                                       20
<PAGE>

                           (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)

                                       21
<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 Life 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.

                                       22
<PAGE>

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

                           (t) Key Employee Incentive Stock Plan of 1986.


<PAGE>



                           (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, dated December 15, 1996.

                           (v) 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, dated December 15, 1997.

         21                Subsidiaries of the Registrant.

         27                Financial Data Schedule.

         99                Financial Statements
                  (a)      No Reports on Form 8-K were filed during the last
                           quarter of 1998.

                  (b)      8-K Report for the first quarter of 1998 was filed.

                  (c)      8-K Report for the first quarter of 1999 was filed.


                                       24
<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 11, 1999             By: /s/ John W. Biddinger
-----------------------             --------------------------------------
                                        John W. Biddinger, President
                                        Sarasota, Florida

         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 11, 1999             /s/ John W. Biddinger
                                    John W. Biddinger, Director and
                                    (Principal Executive Officer)

DATED:   March 11, 1998             /s/ James M. Elliott
                                    James M. Elliott, Director

DATED:   March 11, 1999             /s/ James A. Hoetger
                                   James A. Hoetger, Treasurer, Secretary and
                                   Vice President
                                   (Principal Accounting/Financial Officer)

DATED:   March 11, 1999             /s/ Dan E. Young
                                    Dan E. Young, Director


                                       25
<PAGE>

                               INDEX OF 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)

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

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

                                       26
<PAGE>
                               INDEX OF EXHIBITS


Exhibit No.                Description of Exhibit
-----------                ----------------------

                            (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)

         10
                           (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)

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

                                       27
<PAGE>

                               INDEX OF EXHIBITS


Exhibit No.                Description of Exhibit
-----------                ----------------------

                           (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)

                           (s)      Key Employee Incentive Stock Plan of 1986.4

                           (t)      Amendment number two to the John W.
                                    Biddinger Employment Agreement.(4)

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

4 Incorporated by reference to the Corporation's Annual Report on Form 10-K for
  the year ended December 31, 1996.

                                       28
<PAGE>

                               INDEX OF EXHIBITS


Exhibit No.                Description of Exhibit
-----------                ----------------------
10
                           (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, dated
                                    December 15, 1996.(5)

                           (v)      Employment Agreement with James A. Hoetger,
                                    Vice President.

                           (w)      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, dated
                                    December 15, 1997.

                           (x)      Agreement By and Among RadioSunGroup of
                                    Texas, Inc. and Mt. Pleasant Radio, Inc.,
                                    dated January 27, 1997.

                           (y)      Secured Promissory Note for $800,000 between
                                    RadioSunGroup of Texas, Inc. and Young
                                    Investments Company (A Nevada Partnership)
                                    dated December 24, 1997.

                           (z)      Cancellation of Secured Promissory Note,
                                    dated February 28, 1998.


                           (aa)     Secured Promissory Note for $400,000 between
                                    RadioSunGroup of Texas and Young Investments
                                    Company (A Nevada Partnership) dated March
                                    1, 1998 and UCC-1 form.

                           (bb)     Secured Promissory Note for $150,000 between
                                    RadioSunGroup of Texas and John W. Biddinger
                                    dated March 1, 1998 and UCC-1 form.

                           (cc)     Secured Promissory Note for $150,000 between
                                    RadioSunGroup of Texas and Margaret H.
                                    Biddinger dated March 1, 1998 and UCC-1
                                    form.

                           (dd)     Secured Promissory Note for $100,000 between
                                    RadioSunGroup of Texas and Karen Biddinger
                                    dated March 1, 1998 and UCC-1 form.

                           (ee)     Renewal and Extension Agreement effective
                                    January 2, 1998 by and between RadioSunGroup
                                    of Texas, Inc.  ("Borrower") and Kenneth R.
                                    Reynolds ("Lender") in the amount of
                                    $516,600.00.

                           (ff)     Renewal and Extension Agreement effective
                                    January 2, 1998 by and between RadioSunGroup
                                    of Texas, Inc. ("Borrower") and Kenneth R.
                                    Reynolds ("Lender") in the amount of
                                    $270,600.00.

                                       29
<PAGE>

                               INDEX OF EXHIBITS


Exhibit No.                Description of Exhibit
-----------                ----------------------
10
                           (gg)     Renewal and Extension Agreement effective
                                    January 2, 1998 by and between RadioSunGroup
                                    of Texas, Inc. ("Borrower") and Kenneth R.
                                    Reynolds ("Lender") in the amount of
                                    $32,800.00.

                           (hh)     Tri-Party Payment Agreement effective
                                    January 2, 1998 by and between Radio
                                    SunGroup of Texas, Inc., Kenneth R.
                                    Reynolds, John Osburn and Arden Osburn.

                           (ii)     List of SunGroup notes, which matured on
                                    February 15, 1998


         21                Subsidiaries of the Registrant(5)

         27                Financial Data Schedule(5)

         99                Financial Statements

                                       30