apex10ksba063006.htm

U.S. Securities and Exchange Commission

Washington, D.C. 20549

Form 10-KSB/A

(Amendment No.1)

[X]

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1933

For the fiscal year ended June 30, 2007

[ ]

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____________ to ______________

Commission File Number 000-11695

APEX RESOURCES GROUP, INC.

(Name of Small Business Issuer in its charter)

UTAH		- 87-0403828 -
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

299 S. Main Street, Suite 1300, Salt Lake City, Utah		84111
(Address of principal executive Offices)		(Zip Code)

Issuer's telephone number: (801) 534-4450

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

Securities registered pursuant to section 12(g) of the Exchange Act: Common, $0.001 par value

Check whether the issuer is not required to file reports pursuant to Section 13 or 15(d) of the Exchange Act [ ]

Check whether the Issuer (1) filed all reports required to be filed by section 13 or 15(d) of the Exchange Act during the past 12 months (or 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. [ ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act) Yes [ ] No [X].

The issuer’s revenue for its most recent fiscal year was: $1,089.

The aggregate market value of the voting and non-voting common equity held by non-affiliates computed based on the average bid and asked price of such common equity as of October 11, 2007 was approximately $4,599,790.

As of October 8, 2007, the issuer had 120,681,870 shares of its $0.001 par value common stock outstanding.

Transitional Small Business Disclosure Format. Yes [ ] No [X]

Documents incorporated by reference: None

APEX RESOURCES GROUP, INC.

TABLE OF CONTENTS

EXPLANATORY NOTE

PART I

ITEM 1.	DESCRIPTION OF BUSINESS	3

ITEM 2.	DESCRIPTION OF PROPERTY	7

ITEM 3.	LEGAL PROCEEDINGS	8

ITEM 4.	SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS	8

PART II

ITEM 5.	MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS AND SMALL BUSINESS ISSUER PURCHASES OF EQUITY SECURITIES	8

ITEM 6.	MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS	10

ITEM 7.	FINANCIAL STATEMENTS	15

ITEM 8.	CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE	15

ITEM 8A.	CONTROLS AND PROCEDURES	15

ITEM 8B.	OTHER INFORMATION	16

PART III

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

ITEM 10.	EXECUTIVE COMPENSATION	20

ITEM 11.	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS	22

ITEM 12.	CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE	23

PART IV

ITEM 13.	EXHIBITS	25

ITEM 14.	PRINCIPAL ACCOUNTANT FEES AND SERVICES	25

SIGNATURES		26

Explanatory Note to Amendment No. 1 to Form 10-KSB

This Amendment No. 1 to Form 10-KSB is being made to correct several typographical errors in the financial statements of the Company included in Part II, Item 7 of the Form 10-KSB filed on October 15, 2007 (the “Original Filing”). The only changes that have been made are the following: i) on the Balance Sheet under the heading “Stockholders’ (Deficit) Equity” the Original Filing showed issued and outstanding Common Stock of the number of issued and outstanding common stock of 92,625,212, the correct number of issued and outstanding shares is 120,681,780; ii) on the Statement of Operations the line item “Weighted average shares outstanding” of the Original Filing discloses 92,625,212 shares at June 30, 2007 the correct number is 110,313,191; and iii) on the Statements of Cash Flows under the heading “Schedule of Noncash Operating, Investing and Financing Activities” for the line items “Cancellation of Common stock subscriptions for the year ended June 30, 2007,” “Issuance of Common stock for stock subscriptions – year ended June 30, 2007” and “Securities received for payment of receivable – year ended June 30, 2007” while amounts were included in the “Jan. 27 1984 (date of inception of development stage) to June 30, 2007” column the amounts for the “June 30, 2007” column were omitted, those amounts have been added.

Pursuant to the rules of the SEC, we have included currently-dated certifications from our principal executive and principal accounting officers, as required by Sections 302 and 906 of the Sarbanes-Oxley Act of 2002. These certifications are attached as Exhibits 31.1, 31.2, 32.1 and 32.2, respectively. Except as described in the preceding paragraph, this Amendment continues to describe conditions as of the Original Filing and we have not updated the disclosures contained herein to reflect events that have occurred subsequent to that date. Accordingly, this Amendment should be read in conjunction with our other filings, if any, made with the SEC subsequent to the filing of the Original Filing, including any amendments to those filings.

PART I

FORWARD LOOKING STATEMENTS

Except for the historical information contained herein, the matters discussed in this Annual Report on Form 10-KSB are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. For this purpose any statements contained in this Form 10-KSB that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the foregoing, words such as “may,” “hope,” “will,” “expect,” “believe,” “anticipate,” “estimate” or “continue” or comparable terminology are intended to identify forward-looking statements. These statements by their nature involve substantial risks and uncertainty, and actual results may differ materially depending on a variety of factors, many of which are not within our control, including, but not limited to, market factors, market prices (including regional basis differentials) of natural gas and oil, results for future drilling and marketing activity, future production and costs, environmental factors and other factors detailed herein and in our other Securities and Exchange Commission filings. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual outcomes may vary materially from those indicated. These forward-looking statements speak only as of their dates and should not be unduly relied upon. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

ITEM 1. DESCRIPTION OF BUSINESS

History and Organization

Apex Resources Group Inc. (“us”, “we” or the “Company”) is a development stage company. We incorporated under the laws of the State of Utah on January 27, 1984. We were organized primarily to hold overriding royalties of both producing and non-producing oil and gas properties. Our Articles of Incorporation, however, authorize us to engage in all aspects of the oil and gas business and for any other lawful purpose.

In 1989, we transferred our assets in exchange for cancellation of outstanding debt and ceased operations until 1995. Since 1995, we have been primarily engaged in the business of acquiring interests in oil and gas properties.

Our executive offices are located at 299 South Main Street, Suite 1300, Salt Lake City, Utah 84111. Our telephone number is (801) 534-4450. Our website is located at www.apexresourcesgroup.com.

Our Business

Our primary business is the acquisition of small working interests in oil and gas prospects for investment purposes. We do not undertake exploration or drilling activities. We are not an operator. We do not engage in oil and gas production or sales activities. Rather, we acquire small working interests in oil and gas prospects for investment purposes.

Although for the past few years we have had limited funds, we continue to investigate the acquisition of interests in oil and gas properties. To date, we have and will continue to seek to acquire only minor interests in oil and gas prospects thereby diversifying our risk. As a result of our strategy to participate only as a passive investor in these projects, we hope to keep our overhead to a minimum.

We seek to purchase interests for cash or in exchange for shares of our common stock, where allowed by law. Any purchases made with cash will be made with cash on hand, internally generated capital, financed through conventional loans made by oil and gas lenders or through funds made available through equity financing. We may consider issuing common stock to project owners in situations where the project has significant upside potential due to proven reserves that are behind pipe or that are undeveloped and for which traditional financing cannot be obtained.

Oil and Gas Prospects

We currently own working interests in three prospects.

Beaufort Sea

We hold a 3.745% working interest in the Beaufort Sea well Esso Pex Home, et. al. Itiyok I-27, consisting of 640 acres, located at Latitude 70-00', Longitude 134-00', Sections 7, 8, 17, 18, 27, 28 and 37. License No. 55, dated April 22, 1987. During 1982 and 1983 a consortium of companies participated in drilling, casing and testing the area to a depth of 12,980 feet.

The main partner in the project is Imperial Oil Resources. A consortium of oil and gas companies has filed an application to build a natural gas pipeline that could be used to transport gas from the Beaufort Sea region, but the application has not been approved. No current plans have been formulated to perform further work in the immediate Beaufort Sea area. It is anticipated this area will not be developed until a pipeline is built.

Bastian Bay Field, Plaquamines Parish, Louisiana

Last year, Imperial Petroleum Inc., the operator of Bastian Bay Field Lease #16152 in Plaquamines Parish Louisiana made a cash call to all participants in the well. The participants in the well were given the choice to pay the cash call or continue on a non-consent basis under which the non paying participants relinquishing half of their working interest. We determined that it was not in our best interest to meet the cash call. Therefore, our interest in this well decreased from 6.25% to 3.125%. As of this time Imperial has put work on the well on hold and we do not know when they expect to begin work again.

Henry Dome Prospect, Texas

We own 2.5 participation units in the Henry Dome Prospect in McMullen County, Texas. These units give us a 1.875% working interest in JB Henry Dome #1 well. Initial flow testing of the well demonstrated flow of 450,000 cubic feet of gas per day. Following initial testing, acid washing of the well was performed to attempt to increase flow rates. Additional testing is ongoing as the operator has encountered many problems with this well. We do not know when, or if, this well will be re-opened.

Market for Oil and Gas

The market for oil and gas production is regulated by federal, state and foreign governments. The overall market is mature and with the exception of gas, all producers in a producing region will receive the same price. The major oil companies will purchase all crude oil offered for sale at posted field prices. There are price adjustments for deviations from the quality standards established by the purchaser. Oil sales are normally contracted with a “gatherer” which is a third-party who contracts to pickup the oil at the well site. In some instances there may be deductions for transportation from the wellhead to the sales point. The majority of crude oil purchasers do not at this time charge transportation fees, unless the well is outside their service area. The oil gatherer will usually handle disbursements of sales revenue to both the owners of the well (a “working interest owner”) as well as payments to persons entitled to royalties as a result of such sales (“royalty owners”). We typically will only be a working interest owner in the projects in which we invest. By being a working interest owner, we are responsible for the payment of our proportionate share of the operating expenses of the well. Royalty owners receive a percentage of gross oil production for the particular lease and are not obligated in any manner whatsoever to pay for the cost of operating the lease. Therefore, in most instances, we will be paying the expenses for the oil and gas revenues paid to the royalty owners.

In contrast to sales of oil, gas purchasers pay the well operator 100% of the sales proceeds monthly for the previous month’s sales. The operator is responsible for all checks and distributions to the working interest and royalty owners. There is no standard price for gas. Prices will fluctuate with the seasons and the general market conditions. It is our intention to utilize this market whenever possible. We do not anticipate any significant change in the manner in which gas production is purchased, however, no assurance can be given that such changes will not occur in the future.

Competition

Given current market prices, the competition for interests in oil and gas prospects and producing properties is intense. If funding becomes available to allow us to pursue additional investments, we will be competing with a number of other potential purchasers of prospects and producing properties, most, if not all, of which will have greater financial resources. The bidding for working interests in prospects has become particularly intense with different bidders evaluating potential acquisitions with different product pricing parameters and other criteria that result in widely divergent bid prices. The presence in the market of bidders willing to pay prices higher than are supported by the our evaluation criteria could further limit our ability to invest in working interests in prospects and low or uncertain prices for properties can cause potential sellers to withhold or withdraw properties from the market. In this environment, there can be no assurance that there will be a sufficient number of suitable prospects available for us to invest in or that we will be able to obtain financing for future investments.

Most, if not all, of our competitors have greater financial, personnel and other resources than do we and therefore have greater leverage to use in acquiring prospects, hiring personnel and marketing oil and gas. Given current market prices, a high degree of competition in these areas is expected to continue indefinitely.

Governmental Regulation

The production and sale of oil and gas is subject to regulation by state, federal, local authorities, and foreign governments. In most areas there are statutory provisions regulating the production of oil and natural gas under which administrative agencies may set allowable rates of production and promulgate rules in connection with the operation and production of such wells, ascertain and determine the reasonable market demand of oil and gas, and adjust allowable rates with respect thereto.

The sale of liquid hydrocarbons was subject to federal regulation under the Energy Policy and Conservation Act of 1975 that amended various acts, including the Emergency Petroleum Allocation Act of 1973. These regulations and controls included mandatory restrictions upon the prices at which most domestic crude oil and various petroleum products could be sold. All price controls and restrictions on the sale of crude oil at the wellhead have been withdrawn. It is possible, however, that such controls may be reimposed in the future but when, if ever, such reimposition might occur and the effect thereof cannot be predicted.

Approvals to conduct oil and gas exploration and production operations are required from various governmental agencies. There is no assurance when and if such approvals will be granted.

While we do not actively engage in exploration or production activities, governmental regulation effecting oil and gas exploration and production can have a direct impact upon the value of the our investments in working interests in oil and gas prospects.

Environmental Laws

We intend to invest only in leases where the operator has a history of conducting its operations in compliance with all applicable environmental laws. The cost of such compliance has been and will be factored into the estimated costs of drilling and production. The effects of applicable environmental laws add to the cost of operations and to add to the time it takes to bring a project to fruition.

Employees

We currently has no full-time employees. Our officers, particularly our Corporate Secretary, provide services to the Company on an as needed basis. To the extent other services are needed, we contract out those services to third parties.

Reports to Security holders

We file Annual Reports on Form 10-KSB, Quarterly Reports on Form 10-QSB, Current Reports on Form 8-K and other items with the Securities and Exchange Commission (SEC). We provide free access to all of these SEC filings, as soon as reasonably practicable after filing, on our Internet web site located at www.apexresources.com. In addition, the public may read and copy any documents we file with the SEC at the SEC’s Public Reference Room at 100 F Street N.E., Washington, DC 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC maintains its Internet site www.sec.gov, which contains reports, proxy and information statements and other information filed in the SEC’s EDGAR system.

ITEM 2. DESCRIPTION OF PROPERTY

Rental Properties

Abbecombec Ocean Village Resort

Subsequent to the fiscal year end, in July 2007, we sold this property for $147,00 and received net proceeds of approximately $97,000 after deduction of closing costs and expenses.

We own no other rental properties.

Executive Offices

We currently lease 200 square feet of executive office space located at 299 South Main Street, Suite 1300, Salt Lake City, Utah 84111. The offices are rented on a month-to-month basis for approximately $1,600 per month. We believe this space will be sufficient for our needs for the foreseeable future.

We also own approximately 11,146,679 or 14.2% of the outstanding common shares of Omega Ventures Group, Inc., a corporation whose common stock is traded on the Over-the-Counter Bulletin Board, stock symbol “OMGV.” Certain of our officers and directors, John Rask and John Hickey, also serve as officers and directors of Omega Ventures Group.

ITEM 3. LEGAL PROCEEDINGS

None.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE

OF SECURITY HOLDERS

No matters were submitted to a vote of our shareholders during the fiscal quarter ended June 30, 2007.

PART II

ITEM 5. MARKET FOR COMMON EQUITY AND

RELATED STOCKHOLDER MATTERS

Our common stock is listed on the NASD OTC Bulletin Board under the symbol “APXR." As of October 8, 2007, we had approximately 950 shareholders of record holding 120,681,870 shares of our issued and outstanding common stock.

The published closing bid and ask quotations for the previous two fiscal years are included in the chart below. These quotations represent prices between dealers and do not include retail markup, markdown or commissions. In addition, these quotations do not represent actual transactions.

	BID PRICES		ASK PRICES
	HIGH	LOW	HIGH	LOW
2007-2006
Apr. thru June 2007	.14	.075	.15	.079
Jan. thru Mar. 2007	.10	.036	.11	.04
Oct. thru Dec. 2006	.056	.024	.06	.025
July thru Sep. 2006	.06	.04	.07	.045

2006-2005
Apr. thru June 2006	.07	.04	.075	.041
Jan. thru Mar. 2006	.06	.04	.063	.047
Oct. thru Dec. 2005	.125	.048	.129	.049
July thru Sep. 2005	.166	.075	.16	.08

The foregoing figures were furnished to the Company by Pink Sheets, L.L.C., 304 Hudson Street, 2^nd Floor, New York, New York 10013.

Dividends

We have not declared a cash dividend on any class of common equity in the last two fiscal years. There are no restrictions on our ability to pay cash dividends, other than state law which may limit our ability to pay dividends in cetain cases. Our Board of Directors does not, however, anticipate paying any dividends in the foreseeable future; it intends to retain the earnings that could be distributed, if any, for the operations, expansion and development of its business.

Securities for Issuance Under Equity Compensation Plans

We currently have no equity compensation plans and no securities outstanding under any equity compensation plan.

Unregistered Securities of Equity Securities

On May 5, 2007, we closed a private placement of units to four non-U.S. investors. Each unit consisted of one share of our restricted common stock and one warrant to purchase an additional share of restricted common stock at an exercise price of $0.03 per share. The warrants are immediately exercisable and expire two years from the date they were issued. The unit price was $.022 per unit. We sold a total of 10,000,000 units.

Total proceeds from the private placement was $220,000. From the total proceeds, we paid a finders’ fees of 10% of the total amount raised. The finders’ fee was not paid either directly or indirectly to any officer, director or greater than 10% shareholder of the Company.

All offers and sales were made to non-U.S. persons in offshore transactions. No directed selling efforts were made in the United State by the issuer, placement agent or any person acting on their behalf. The shares sold are subject to the offering restrictions set forth in Rule 903(b)(3), including a one-year distribution compliance period.

No instruments defining the rights of the holders of any class of registered securities were materially modified, limited or qualified during the quarter ended June 30, 2007.

Repurchases of Equity Securities

During the quarter ended June 30, 2007, we did not repurchase any of our equity securities.

ITEM 6. MANAGEMENTS’ DISCUSSION AND ANALYSIS

OR PLAN OF OPERATIONS

The following discussion is intended to assist you in understanding our results of operations and our present financial condition. Our financial statements and the accompanying notes included elsewhere in this Form 10-KSB contains additional information that should be referred to when reviewing this material.

Statements in this discussion may be forward-looking. These forward-looking statements involve risks and uncertainties, including those discussed below, which could cause actual results to differ from those expressed. Please read Forward-Looking Information on page 4.

General

We are a development stage company engaged in the exploration of gas and oil. We have been engaged in the gas and oil business since 1995.

Liquidity and Capital Resources

We currently does not have sufficient cash reserves or cash flow from operations to meet its cash requirements. This raises substantial doubt about our ability to continue as a going concern. During the year ended June 30, 2007, we financed our operations primarily through credit arrangements extended to us by related parties and through the sale of our equity securities in a private placement transaction. During the quarter ended December 31, 2004, we received subscriptions to purchase 18,000,000 shares of its common stock in private placement transactions for cash totaling $2,450,000. As of March 31, 2006, we had received $23,000. Our balance sheet reflected the remaining balance as stock subscriptions receivable. During the quarter ended December 31, 2004, we caused our transfer agent to issue the 18,000,000 shares. These shares were placed in escrow for delivery only after we received funds. During the 2007 fiscal year it became apparent to us that we were not going to receive the balance of the funds to pay for the shares subscribed for, so we cancelled the subscription agreements and returned the shares held in escrow for cancellation and return to the treasury of the Company.

During the year we used our shares to reduce our debt obligations. During the first quarter, we issued 1,483,636 restricted shares of our common stock to John Hickey in full satisfaction of services rendered to the Company during the fourth fiscal quarter 2005 through the fourth fiscal quarter 2006. The shares were issued in satisfaction of services rendered totaling approximately $105,000. During our first fiscal quarter 2007 we also issued an aggregate of 4,450,905 to three parties for services rendered from the fourth fiscal quarter 2005 through the fourth fiscal quarter 2006 totaling $315,000. Two of the parties were issued shares for investor relations services provided to the Company. The third party received the shares in satisfaction of amounts we owed in connection with the leasing of office furnishings and equipment. During the second fiscal quarter 2007 we issued 12,122,117 restricted shares of our common stock to five entities in settlement of loans we received from these parties in the aggregate amount of $121,221.

During the fourth fiscal quarter 2007 we sold 10,000,000 Units, consisting of one share of our common stock and one warrant to purchase an additional share of our common stock in a private placement transaction. Gross proceeds from the private placement were $220,000.

Finally, during the year we sold our rental properties for $247,131 and realized a gain on the sale of those properties of $141,636. The sale of rental properties is a one-time event. Subsequent to the fiscal year end, in July 2007 we sold our final rental property for $147,000 and realized net proceeds from the sale of that property of approximately $97,000. As we no longer own any rental properties, we do not expect we will realize similar cash flow from the sale of rental properties in future years.

On June 30, 2007, we had cash on hand of $33,048.

With the sale of our rental properties our only business is the acquisition of minority working interest in oil and gas prospects for investment. While we would like to indentify and acquire interests in additional prospects interests, we have limited funds to do so. Moreover, none of the prospects in which we currently own interests are producing, which means we are not currently realizing any revenue from our investments. Nor does it appear that any of these prospects will become productive in the near future. Therefore, we do not anticipate significant revenue in upcoming quarters.

The foregoing issues raise substantial doubt about our ability to continue as a going concern.

Results of Operations

Comparison of the year ended June 30, 2007 and the year ended June 30, 2006

We suffered a net loss of $271,012 during in the fiscal year ended June 30, 2007 compared to a net loss of $642,665 for the year ended June 30, 2006. This decrease in net loss was largely the result of a 39% decrease in exploration, development and administrative expenses resulting from curtailing our activities because of a lack of funding for operations coupled with a 246% increase in gain on the sale of rental properties during the 2007 fiscal year. As discussed above, we sold our final rental property during our first fiscal quarter of 2008. Therefore, in the future we will not be realizing any additional gain on the sale of real estate to help offset operating expenses.

The following table shows a more detailed comparison of our exploration, development and administrative expenses during the past two years:

	June 30, 2007		June 30, 2006

Travel	$	92,551