SECURITIES & EXCHANGE COMMISSION
WASHINGTON, DC 20549
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES
For the fiscal year ended December 31, 2001
Commission file number 0-17165
SUNSTYLE CORPORATION
(Exact name of Registrant as specified in its charter)
Florida 59-2905386
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
4900 Creekside Drive, Clearwater, Florida 33760
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area (727) 592-0299
Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange
Title of each class on which registered
None None
Securities registered pursuant to Section 12(g) of the Act:
Common Stock (par value $.10)
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or 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
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (229.405 of this chapter) is not contained herein, and will not 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-k or any amendment to this Form 10-K. [X]
Aggregate market value of the voting stock held by non-affiliates of the registrant as of September 30, 2001: $1,960.
Number of Common shares outstanding (September 30, 2001): 1,096,014
SUNSTYLE CORPORATION
December 31, 2001
PART I
Item 1. Business
COMPANY
In May of 1991, the Company finished construction on its final house and ceased construction activities. During 1993 and 1992 the Company sold its remaining lots in Pinellas and Manatee counties to other developers and builders. During 1995, the company sold its office/storage building in Largo, Florida. The Company's President has continued to manage the affairs of the Company while pursuing other business interests.
The Company continues to seek a possible merger with another company and continue operations as the general economy improves or the Board of Directors may decide to proceed with a liquidation and distribute the proceeds, if any, to its shareholders.
Item 2. Properties
The company does not own any property or land as of December 31, 2001.
Item 3. Legal Proceedings
None.
Item 4. Submission of Matters to a Vote of Security Holders
None.
PART II
Item 5.Market for the Registrant's Securities and Related Security
Holder Matters
The Company's stock is traded on the Over-The-Counter market. The following table sets forth for the periods indicated the high and low prices for the Company's common stock:
2001 2000
-------- --------
Quarter ended High Low High Low
- ------------- ------ ------ ------ ------
All $ .001 $ .001 $ .001 $ .001
The Company does not intend to pay dividends on its common stock except in the possible case of a liquidating dividend. Should the Company merge with another company and retain its shares, its future dividend policy will be determined by its Board of Directors in light of the Company's earnings and financial position.
Item 6. Selected Financial Data
2001 2000 1999 1998 1997
----- ----- ----- ----- -----
(dollar figures in thousands, except per share information)
Operating Results:
Revenues $ 7 $ 11 $ 9 $ 10 $ 10
Net Income (loss) $ (3) $ 8 $ (3) $ 14 $ 3
Net income (loss)
per share $(.002) $ .007 $(.003) $ (.01) $ .003
2001 2000 1999 1998 1997
----- ----- ----- ----- -----
(dollar figures in thousands, except per share information)
Financial Condition:
Total assets $ 211 $ 213 $ 208 $ 208 $ 207
Notes payable:
Former Parent $ 255 $ 255 $ 255 $ 255 $ 255
Stockholders'
equity (deficit) $ (141) $ (139) $ (147) $ (144) $ (158)
Book value per
share (1) $ (0.13) $(0.13) $ (0.13) $ (0.13) $ (0.14)
(1) The per share information is based upon 1,096,014 shares of Common
Stock for the years ended December 31, 2001, 2000, 1999, 1998, and 1997.
SUNSTYLE CORPORATION
December 31, 2001
Item 7. Management's Discussion and Analysis of Financial Condition and Results
of OperationThe Company's revenues of $7,132 for 2001 consisted of $7,123 interest earned on savings accounts. The Company's only activity in the year ended December 31, 2001, was administrative.
General and administrative expenses totaled $9,728 for the year ended December 31, 2001, resulting in net loss for the year of $2,596.
The Company's revenues of $11,493 for 2000 consisted of $11,493 interest earned on savings accounts. The Company's only activity in the year ended December 31, 2000, was administrative.
General and administrative expenses totaled $6,017 for the year ended December 31, 2000, combined with $2,730 of accounts payable which were written off against expenses, resulting in a net income for the year of $8,206.
YEAR ENDED DECEMBER 31, 2000, COMPARED TO THE YEAR ENDED DECEMBER 31, 1999
The Company's revenues of $11,493 for 2000 consisted of $11,493 interest earned on savings accounts. The Company's only activity in the year ended December 31, 2000, was administrative.
General and administrative expenses totaled $6,017 for the year ended December 31, 2000, combined with $2,730 of accounts payable which were written off against expenses, resulting in a net income for the year of $8,206.
The Company's revenues of $9,000 for 1999 consisted of $9,000 interest earned on savings accounts. The Company's only activity in the year ended December 31, 1999, was administrative.
General and administrative expenses totaled $11,781 for the year ended December 31, 1999, resulting in net loss for the year of $2,781.
LIQUIDITY AND CAPITAL RESOURCES
Due to continuing losses in a depressed market, the Company ceased construction activities and terminated all employees during May of 1991. All remaining real estate assets have been sold.
The Company's liabilities are primarily to its former Parent in the form of an unsecured note ($255,000), interest on the note and other payables. The Company is currently negotiating the settlement of its outstanding debt to its former Parent.
In addition to the uncertainty discussed above, the Company has sustained substantial net losses and has a deficit net worth at December 31, 2001 of $141,146. These issues raise considerable doubt as to the Company's ability to continue operations. Management has not adopted a plan of liquidation and is currently exploring several possibilities, including selling a major interest in the Company. The consolidated financial statements do not include any adjustments that may result from any of the above events.
SUNSTYLE CORPORATION
Item 8. Financial Statements and Supplementary Data
SUNSTYLE CORPORATION AND SUBSIDIARIES
INDEX TO FINANCIAL STATEMENTS AND SCHEDULES
Financial Statements
Independent Auditor's Report
Consolidated Balance Sheets as of
December 31, 2001 and 2000
Consolidated Statements of Operations for the Years
Ended December 31, 2001, 2000, and 1999
Consolidated Statements of Changes in Stockholders'
Deficit for the Years Ended December 31, 2001,
2000, and 1999
Consolidated Statements of Cash Flows for the Years
Ended December 31, 2001, 2000, and 1999
Notes to Consolidated Financial Statements
Schedules and Exhibits Excluded
All schedules and exhibits not included are not applicable, not required, or would contain information which is included in the Consolidated Financial Statements or the Notes to Consolidated Financial Statements.
INDEPENDENT AUDITOR'S REPORT
To the Board of Directors and Stockholders
of Sunstyle Corporation
Clearwater, Florida
We have audited the accompanying consolidated balance sheets of Sunstyle Corporation and Subsidiaries as of December 31, 2001 and 2000, and the related consolidated statements of operations, changes in stockholders' deficit and cash flows for each of the three years in the period ended December 31, 2001. These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with accounting principles generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above fairly, in all material respects, the consolidated financial position of Sunstyle Corporation and Subsidiaries as of December 31, 2001 and 2000, and the consolidated results of their operations and their cash flows for each of the three years in the period ended December 31, 2001, in conformity with accounting principles generally accepted in the United States of America.
The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As described more fully in Note 5 to the consolidated financial statements, the Company's substantial net losses and deficit net worth of $141,146 raise considerable doubt as to the Company's ability to continue operations. The consolidated financial statements do not include any adjustments regarding this uncertainty.
Spence, Marston, Bunch, Morris & Co.
Certified Public Accountants
Clearwater, Florida
Date: August 15, 2002
SUNSTYLE CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
December 31,
2001 2000
----------- -----------
ASSETS
Cash $ 210,777 $ 213,172
------------ -----------
$ 210,777 $ 213,172
============ ============
LIABILITIES AND STOCKHOLDERS' DEFICIT
Note Payable to Former Parent $ 255,000 $ 255,000
Interest Payable to Former Parent 93,452 93,452
Accounts Payable and Accrued Expenses 3,471 3,270
------------ ------------
351,923 351,722
------------ ------------
Stockholders' Deficit:
Common Stock; $.10 Par Value;
Authorized 10,000,000 Shares;
Issued and Outstanding
1,096,014 Shares 109,601 109,601
Additional Paid-In Capital 1,341,221 1,341,221
Accumulated Deficit (1,591,968) (1,589,372)
---------- ----------
(141,146) (138,550)
----------- -----------
$ 210,777 $ 213,172
=========== ===========
The accompanying notes are an integral part of
these financial statements.
SUNSTYLE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE YEARS ENDED DECEMBER 31,
2001 2000 1999
-------- -------- -------
Revenues:
Interest Income $ 7,132 $ 11,493 $ 9,000
Other Income 0 2,730 0
--------- --------- ---------
Total Revenues 7,132 14,223 9,000
--------- --------- ---------
Cost and Expense:
General and Administrative 9,728 6,017 11,781
--------- --------- ---------
Total Expenses 9,728 6,017 11,781
--------- --------- ---------
Net Income (Loss) $ (2,596) $ 8,206 $ (2,781)
========= ========= =========
Net Income (Loss) Per Share $ (.002) $ .007 $ (.003)
========= ========= =========
Number of Common Shares
Outstanding 1,096,014 1,096,014 1,096,014
========== ========== ==========
The accompanying notes are an integral part of
these financial statements.
SUNSTYLE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIT
FOR THE YEARS ENDED DECEMBER 31, 1999, 2000 AND 2001
Common Stock Additional
----------------- Paid-In Accumulated
Shares Amount Capital Deficit Total
------- ------- --------- ----------- -----
Balances at
December 31, 1998 1,096,014 $109,601 $1,341,221 $(1,594,797) $(143,975)
Net Loss - 1999 0 0 0 (2,781) (2,781)
-------- -------- --------- ---------- --------
Balances at
December 31, 1999 1,096,014 109,601 1,341,221 (1,597,578) (146,756)
Net Income - 2000 0 0 0 8,206 8,206
-------- -------- --------- --------- --------
Balances at
December 31, 2000 1,096,014 109,601 1,341,221 (1,589,372) (138,550)
Net Loss - 2001
0 0
The accompanying notes are an integral part of
these financial statements.
SUNSTYLE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31,
2001 2000 1999
------- -------
- ------
Cash Flow from Operating Activities:
Net Income (Loss) $(2,596) $ 8,206 $ (2,781)
Adjustments to Reconcile Net Income --------
- -------- --------
(Loss) to Net Cash Provided by
(Used In) Operating Activities:
Increase (Decrease) in Operating
Liabilities:
Accounts Payable and Accrued
Expenses
201 (2,730) 2,000
-------
- ------- -------
Total Adjustments 201 (2,730) 2,000
-------
- ------- -------
Net Cash Provided by (Used in)
Operating Activities (2,395) 5,476 (781)
-------
------- -------
Net Increase (Decrease) in Cash (2,395) 5,476 (781)
Cash at Beginning of Period 213,172 207,696 208,477
- ------- ------- -------
Cash at End of Period $ 210,777 $ 213,172 $ 207,696
======== ======== ========
The accompanying notes are an integral part of
these financial statements.
SUNSTYLE CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2001
NOTE 1 - ORGANIZATION AND OPERATIONS
:NOTE 5 - CONTINGENCIES AND OTHER EVENTS:
The Company is currently negotiating the settlement of its outstanding debt to its former Parent. Although it is possible a settlement could result in the transfer of essentially all remaining assets to its former Parent, the effect of a final settlement cannot be determined at this time.
PART III
Item 10. Directors and Executive Officers of the Registrant
DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth information as to persons who serve as directors and Executive Officers of the Company. As provided in the By-laws of the Company the term of office of each Director is one year.
|
|
|
Principal Occupation |
Director |
|
Thomas A. James |
60 |
Chairman of the Board and Chief Executive Officer of Raymond James Financial, Inc.; Chairman of the Board of Raymond James & Associates, Inc. |
1988 |
Unless otherwise indicated, the directors have held the same principal occupations for at least five years.
Committees of the Board of Directors
The Company has two standing committees of the Board. Set forth below is a description of the functions of those committees and the members of the Board who served on such committees.
Audit Committee: The responsibilities of the audit committee include recommending to the Board the independent certified public accountants to conduct the annual audit of the books and accounts of the Company, reviewing the proposed scope of the audit and approving the audit fees to be paid. The audit committee also reviewed with the independent certified public accountants and with the Company's financial staff the adequacy and effectiveness of the internal accounting and financial controls of the Company. The audit committee consists of Mr. James.
Compensation Committee: In prior years, the compensation committee recommended to the Board the salaries of the executive officers of the Company and approved the salaries of all other officers and certain other employees. It also determined, subject to further approval of the Board, the fees for directors, and supervised the administration of all benefit plans and other matters affecting executive compensation. The compensation committee, which is now inactive, included Mr. James and a former director, Mr. Krusen.
Director Compensation
During 2001, no fees or expenses were paid to the directors because there were no Board or Committee meetings. Both of the current directors are significant owners.
Item 11. Executive Compensation
No executive officer received cash or other compensation during 2001.
Item 12. Security Ownership of Certain Beneficial Owners and Management
|
Name |
Shares |
|
|
Thomas A. James (1) |
447,466 (2) (3) |
40.9% |
(1) Messrs. Thomas A. James and Christopher W. James are brothers.
Their address is 880 Carillon Parkway, St. Petersburg, FL 33716.
(2) Includes (i) 111,320 shares owned by the Robert A. James Trust, established for
the benefit of members of the James family, (ii) 4,474 shares owned by the James
Grandchildren's Trust, for which trusts Thomas A. and Christopher W. James serve as co-trustees, and (iii) 563 shares owned by Mary S. James.
(3) Includes 66,792 shares owned by the James' Children Annuity Trust, for which Thomas A. James serves as sole trustee.
(4) On February 12, 1991, Carr Securities filed Form 13G with the Securities and
Exchange Commission advising that the firm had acquired 109,232 shares in the
ordinary course of business as a Broker or Dealer registered under the Securities
Exchange Act of 1934 and the shares were not acquired to influence or control the
issuer. Carr Securities has sole voting power of these shares. The address of Carr
Securities is One Penn Plaza, Suite 4720, New York, NY 10119.
(5) On December 6, 1988, the Board of Directors of Sunstyle agreed to grant to Mr. Quartetti options to purchase 54,588 shares of Sunstyle Common Stock pursuant to the Sunstyle Corporation Incentive Stock Option Plan. The address of Mr. Quartetti is 3900 Creekside Drive, Clearwater, FL 33760.
(6) Mr. Ehlers' address is 2502 Rocky Point Drive, Suite 500, Tampa, FL 33607.
(7) On October 23, 1989, Charles I. Rutenberg filed a Schedule 13-D with the Securities and Exchange Commission advising that he acquired 55,500 shares of Sunstyle Corporation common stock through purchases on the open market. On November 1, 1992, Mr. Rutenberg transferred 61,500 shares to the Golda Meir Center Endowment Corporation, a charitable corporation. These shares are held for investment purposes only.
Item 13. Certain Relationships and Related Transactions
The Company owes interest to Raymond James related to outstanding debt. During 2001, the Company did not engage in any transactions with related parties.
PART IV
Item 14. Exhibits, Financial Statement Schedules, and Reports on
Form 8-K
a) Financial statements included with this filing.
b) None
c) None
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Clearwater, State of Florida, on the 13th day of August, 2002.
SUNSTYLE CORPORATION
By /s/Ralph W. Quartetti
Ralph W. Quartetti, President
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
Signature Title
Date
/s/Ralph W. Quartetti Chief Executive Officer, August 13, 2002
Ralph W. Quartetti President and Director
/s/Thomas A. James Director August 13, 2002
Thomas A. James