To prepare the dough: Combine and mix the water, sugar and yeast together until dissolved. Add the olive oil and salt. Mix in the flour until combined. Shape the dough into a ball and let rest in large bowl, covered loosely with a towel, anywhere from 30 minutes to two hours.
After the dough has risen; pull off marble-sized chunks of dough and flatten with your hands. Top with a piece of the mozzarella and a slice of pepperoni. To close the ball, wrap the dough around the mozzarella and pepperoni; pinch the edges to seal. Repeat until all the dough is gone, setting each ball aside as you work.
Coat the inside of a bundt pan with cooking spray.
In a small bowl, combine the melted margarine, parsley, basil, garlic, and salt; mix well. Dip each ball in the butter mix and then place it in the bundt pan. Repeat until done. If desired, sprinkle a bit of parmesan cheese on each ball before placing in the pan.
Cover the bundt pan with plastic wrap and let sit on the counter for 30 minutes. Preheat the oven to 400F.
Remove the plastic wrap and bake at 400F for approximately 30 minutes, or until the crust is brown.
When done cooking, transfer the monkey bread to a serving platter. Enjoy with warm marinara sauce.