SECURITIES
AND EXCHANGE COMMISSION
 Washington,
D.C. 20549
  FORM
10-K
 
 x  ANNUAL REPORT
PURSUANT TO SECTION 12(g) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the
fiscal year ended: December 31, 2008
 OR
 
 o  TRANSITION REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
 
 For the
transition period from __________ to __________
 
 Commission
File No. 000-30563
 
 ROYAL
STYLE DESIGN, INC.
 (Exact
name of Registrant as Specified in Its Charter)
  Florida
                                
                                74-3184267(State
      or other jurisdiction of
                                
                                (I.R.S.
      EmployerIncorporation
      or organization)
                                
                                Identification
      No.)
  2561 Forsythe Road,
      Unit D, Orlando,
      FL
                                  (Address of
      principal executive offices)
                                
                                32807
                                    (Zip Code)
 Registrant’s Telephone
Number, including area code:   (407)
758-6801
 
 Securities
registered pursuant to Section 12(b) of the Act:  None
 
 Securities
registered pursuant to Section 12(g) of the Act:  Common Stock, $.001
par value per share
 
 Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act.   Yes  o   No
x
 
 Indicate
by checkmark if the registrant is not required to file reports to Section 13 or
15(d)Of the Act.   o Yes  x No
 
 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 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.  o  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. o
 
 Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, or a smaller reporting company.  (Check
One):
  Large
      accelerated filer
                  o
                  Accelerated
      filer
                  oNon-accelerated
      filer
                  o
                  Smaller
      reporting company
                  x
 (Do not
check if a smaller reporting company)
 
 Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act). o  Yes x  No
 
 The
aggregate market value of the voting and non-voting common equity held by
non-affiliates  as of the last business day of the registrant’s most
recently completed second fiscal quarter was $NA.
 
 Number of
shares of Common Stock outstanding as of March 13, 2009: 4,500,000.
 
 Documents
incorporated by reference:  None
 
 
 
  TABLE OF
CONTENTS
 
 
 
 PART I
                    
                    
                    1Item 1.  Business.
                    
                    
                    1Item 1A.  Risk
Factors.
                    
                    
                    2Item 1B.  Unresolved Staff
      Comments.
                    
                    
                    4Item 2.  Properties.
                    
                    
                    4Item 3.  Legal
      Proceedings.
                    
                    
                    4Item 4.  Submission of Matters to a Vote of
      Security Holders.
                    
                    
                    4PART II
                    
                    
                    5Item 5.  Market for Registrant's Common
      Equity, Related Shareholder Matters and Issuer Purchases of Equity
      Securities.
                    
                    
                    5Item 6.  Selected Financial
      Data.
                    
                    
                    5Item 7.  Management's Discussion and Analysis
      or Plan of Operations.
                    
                    
                    5Item 7A.  Quantitative and Qualitative
      Disclosures About Market Risk.
                    
                    
                    8Item 8.  Financial Statements and
      Supplementary Data.
                    
                    
                    9Item 9.  Changes In and Disagreements With
      Accountants on Accounting and Financial Disclosure.
                    
                    
                    22Item 9A (T).  Controls and
      Procedures.
                    
                    
                    22Item 9B.  Other
      Information.
                    
                    
                    22PART III
                    
                    
                    23Item 10.  Directors, Executive Officers, and
      Corporate Governance.
                    
                    
                    23Item 11.  Executive
      Compensation.
                    
                    
                    24Item 12.  Security Ownership of Certain
      Beneficial Owners and Management and Related Stockholder
      Matters.
                    
                    
                    25Item 13.  Certain Relationships and Related
      Transactions, and DirectorIndependence.
                    
                    
                    26Item 14.  Principal Accountant Fees and
      Services
                    
                    
                    26Item 15.  Exhibits and Financial Statement
      Schedules.
                    
                    
                    26SIGNATURES
                    
                    
                    27
 
  
 
 ii
  PART
I
 
 NOTE
REGARDING FORWARD LOOKING STATEMENTS
 CAUTIONARY
STATEMENT FOR PURPOSES OF THE "SAFE HARBOR" PROVISIONS
 OF THE
PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
 
 This
Annual Report contains historical information as well as forward- looking
statements. Statements looking forward in time are included in this
Annual Report pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Such statements involve known and unknown
risks and uncertainties that may cause our actual results in future periods
to be materially different from any future performance suggested herein. We wish
to caution readers that in addition to the important factors described elsewhere
in this Form 10-K, the following forward-looking statements, among others,
sometimes have affected, and in the future could affect, our actual results
and could cause our actual consolidated results during 2008, and beyond, to differ
materially from those expressed in any forward-looking statements made by or on
our behalf.
 
  Item
1. Business.
  
 Background
 
 Royal
Style Design, Inc. (“we”, “us”, the “Company” or “Royal Style Design”) was
incorporated in the State of Florida on July 7, 2006.  We specialize
in customized surface installation solutions for floors, walls and other parts
of the home using wood, glass, stone and ceramic tile in custom designed homes
throughout central Florida. We have one current project in the Bahamas. Our
business is not seasonal.
  Since
2006, Royal Style Design has supplied tile, stone and wood surface installation
services for new homes and homes being remodeled in the Central Florida
area.  Our principals, Nikolay Lobachev, our President and Chief
Executive Officer, Dmitry Terikov, our Chief Operating Officer, and Ivan
Sorokoumov, our Chief Financial Officer, have been working together as a team
over the past seven years developing expertise and a broad experience in our
business.
 
 Our
management travels regularly to Europe in order to keep up with the most up to
date products and design styles, with the goal of being able to create designs
that capture the styles, personalities and needs of the homeowner, with an
emphasis on classic European design. We review the specific needs of our client
and, based on those needs, recommend the best way to achieve for the client a
one-of-a-kind design.
 
 
 Services
Provided by Our Company
  We are a custom tile and
stone installation company that specializes in ceramic, porcelain, marble,
pavers and natural stone installation in existing structures forceilings, bathrooms, walls, floors, kitchen counters, stairways, outside
terraces and pool moldings.Most of the work we do
is stonework on floors and walls. We also remodel kitchens (not including
building or remodeling cabinets), showers and baths, and install wood and
laminate flooring.
  We do not
build homes or additions, or install terraces or pools, or do structural work,
but we do our surface installation in different materials in homes that have
been constructed. We have started working in commercial buildings, mostly floors
and walls.
 
 We serve
a diverse range of residential clients and builders; most of our clients are
builders, which accounted for approximately 95% of our revenues in
2007.  We do not have any governmental clients. We use professionals
with whom we work regularly to assist in the design and installation processes.
We have eight sub-contractor companies with which we work regularly, and each of
these companies has approximately three to six employees.  No one
builder accounted for more than 25% of our revenues in 2007; our five largest
customers accounted for approximately 65% of our revenues in 2007.
 
 Most of our business comes
from referrals from our satisfied customers.
 
 1
  Sources
of Materials for Our Installation Services
 
 We obtain
tiles, stone, pavers, marble, porcelain and wood from a number of different
local sources, including the large home remodeling and supply stores, The Home
Depot and Lowes.  Our installation material supplies are readily
available from a large number of sources.
 
 
 Payments
for Services at our Company
 
 We
provide a written estimate for services requested by a client. After the client
agrees to the estimate, we commence working on their project.  All but
approximately ten percent of our clients’ projects require multiple surface
installations.  We bill as each stage of the installation is
completed, and our invoices are due within two weeks of receipt.
 
 Insurance
 
 We carry
general liability insurance with coverage of $1,000,000 for each occurrence,
$1,000,000 personal injury insurance, and $2,000,000 in the aggregate, in
addition to workers compensation and employers liability insurance and
commercial vehicle insurance for three pickup trucks owned by the
Company.
 
 Competition
 
 We
experience competition from other installation and remodeling companies and
individual subcontractors.  While there is significant competition, we
have concentrated on providing better services to our clients.  Our
niche market is maintained through customized products and
services.
 
 There are
approximately 40 tile installation companies in the Orlando area, but there are
only five that we consider able to provide similar installation services based
on both quality and cost.  We believe that two of these five
competitors are significantly larger than us.
 
 Governmental
Regulation
 
 We are
subject to the State of Florida Workers Compensation laws and carry workers
compensation insurance.  We have a business license issued by the City
of Altamonte Springs, Florida.
 
 Our
Market Strategy
 
 We
primarily rely on word of mouth referrals for new business. However, we also
advertise in the “Orlando” magazine, participate in Central Florida builders
competitions, such as the “Street of Dreams”, use door-to-door flyers and have
telephone directory listings. We have a corporate website that briefly describes
our company’s services.  Information on our website is not a part of
or incorporated in this registration statement.
 
 Employees
 
 We
currently have six employees, our President and CEO, our Chief Operating
Officer, our Chief Financial Officer and three installers.
 
  Item
1A. Risk Factors.
 
 Our
business is subject to numerous risk factors, including the
following:
 
 WE HAVE A
LIMITED OPERATING HISTORY THAT YOU CAN USE TO EVALUATE US, AND THE LIKELIHOOD OF
OUR SUCCESS MUST BE CONSIDERED IN LIGHT OF THE PROBLEMS, EXPENSES, DIFFICULTIES,
COMPLICATIONS AND DELAYS FREQUENTLY ENCOUNTERED BY A SMALL COMPANY.
  We were
incorporated in Florida on July 7, 2006.  We have a limited amount of
assets or financial resources. The likelihood of our success must be considered
in light of the expenses and difficulties in marketing our services to our
clients. Since we have a limited operating history of marketing our services to
the public, we may not be able to continue to operate profitably or to grow our
business.
  2
  OUR LABOR
COSTS MAY INCREASE WITH A POTENTIAL SHORTAGE OF QUALIFIED
PERSONNEL.
 
 Labor
costs accounted for approximately 64% of the operating expenses in the year
ended December 31, 2007. We compete with other construction companies to
attract and retain qualified or skilled personnel. We also compete with various
industries for lower-wage employees.  If a shortage of construction
workers occurred in the region in which we operate, it could adversely affect
our ability to attract and retain qualified personnel and could further increase
our operating costs.
 
 THE
NATURE OF OUR CONSTRUCTION BUSINESS EXPOSES US TO POTENTIAL LIABILITY CLAIMS AND
CONTRACT DISPUTES WHICH MAY REDUCE OUR PROFITS.
 
 Although
we have not been party to any legal claims against us, we may in future be named
as a defendant in legal proceedings where parties may make a claim for damages
or other remedies with respect to our projects or other matters. If it is
determined that we have liability, we may not be covered by insurance or, if
covered, the dollar amount of these liabilities may exceed our policy limits.
Any liability not covered by our insurance, in excess of our insurance limits
or, if covered by insurance but subject to a high deductible, could result in a
significant loss for us, which claims may reduce our profits and cash available
for operations.
 
 LOSS OF
ANY ONE OF OUR LARGER CUSTOMERS COULD ADVERSELY AFFECT OUR RESULTS OF
OPERATIONS.
 
 Our five
largest customers accounted for approximately 65% of our revenues in 2007. Loss
of one of these larger customers could materially adversely affect our business
and results of operations.
 
 WE ARE
VULNERABLE TO THE CYCLICAL NATURE OF THE CONSTRUCTION BUSINESS.
 
 The
housing market in Florida, in many areas, is exhibiting declines in prices and
the volume of home sales. This decline in the Florida real estate market may
adversely affect the demand for our services. As a result of real estate market
conditions, our operating results may vary, depending upon the demand for future
projects in the housing markets we serve.
 
 INTENSE
COMPETITION IN THE ENGINEERING AND CONSTRUCTION INDUSTRY COULD REDUCE OUR MARKET
SHARE AND PROFITS.
 
 We serve
markets that are highly competitive and in which a large number of installation
and remodeling companies compete. Competition will also place downward pressure
on our contract prices and profit margins. Intense competition is expected to
continue in these markets, presenting us with significant challenges in our
ability to grow our company with acceptable profit margins. If we are unable to
meet these competitive challenges, we could lose market share to our competitors
and experience an overall reduction in our profits.
 
 IF WE
EXPERIENCE DELAYS AND/OR DEFAULTS IN CUSTOMER PAYMENTS, WE COULD SUFFER
LIQUIDITY PROBLEMS OR WE COULD BE UNABLE TO RECOVER ALL
EXPENDITURES.
 
 Because
of the nature of our contracts, at times we commit resources to projects prior
to receiving payments from the customer in amounts sufficient to cover
expenditures as they are incurred. Delays in customer payments may require us to
make a working capital investment. If a customer defaults in making its payments
on a project in which we have devoted significant resources, it could have a
material negative effect on our results of operations.
  WE COULD
FACE LIMITATIONS ON OUR ABILITY TO ACCESS THE CAPITAL MARKETS.
  Although
we have no plans at this time to access the capital markets to raise funds
through the sale of equity or debt securities, our ability to access the capital
markets would be subject to various factors, including general economic and/or
financial market conditions. The current conditions of the financial markets
have adversely affected the availability of credit and liquidity resources and
our access to capital markets is more limited until stability re-emerges in
these markets.
  OUR
COMPANY IS PRIVATELY HELD AND THERE IS NO MARKET FOR OUR COMMON
STOCK.
 
 There is
currently no public market for our common stock, and there can be no assurance
that an active market will develop or, if one does develop, that it will be
sustained.  Transfers of our common stock must be made in strict
accordance with all limitations upon transfer imposed by the Federal and
applicable state securities laws. In order to ensure total compliance, we may
require the opinion of counsel with respect to the applicability of such laws to
a transfer.
 
 3
  Item
1B. Unresolved Staff Comments.
 
 Not
applicable.
 
  Item
2. Properties.
  On July
1, 2007, we started leasing a 650 Sq. ft. warehouse located at 2561 Forsythe
Road, Unit D, Orlando, Fl. 32807.  It is leased annually at $460.00
per month pursuant to a one year lease.  Approximately 120 sq. ft. is
used as office space while the remaining space is used as a
warehouse.
 
 We are
purchasing three Toyota pickup trucks, purchased in December 2006 and January
2007, and have outstanding loans for the purchase of these trucks with an
aggregate principal balance of $71,152 as of December 31, 2008.
    Item
3. Legal Proceedings.
 
 Not
applicable.
    Item
4. Submission of Matters to a Vote of Security Holders.
  Not
applicable.
  4
  PART
II
  Item
5. Market for Registrant's Common Equity, Related Shareholder Matters and Issuer
Purchases of Equity Securities.
 
 The
common stock of the Company is not traded in any United States or foreign
trading market. There are six holders of the Company’s common stock at December
1, 2008.
 
 The
Company has never paid a cash dividend on its common stock and does not
anticipate paying dividends in the foreseeable future. It is the present policy
of the Company's Board of Directors to retain earnings, if any, to finance the
expansion of the Company's business. The payment of dividends in the future will
depend on the results of operations, financial condition, capital expenditure
plans and other cash obligations of the Company and will be at the sole
discretion of the Board of Directors.
 
 The
Company does not have, and has not at any time had in effect, any equity
compensation plan.
 
  Item
6. Selected Financial Data.
 
 
 Year
      Ended December 31,2008
                      
                      
                      2007Statement
      of operations data:Net
      Sales
                      
                      $
                      432,839
                      
                      
                      $
                      577,085Net
      Earnings (Loss)
                      
                      $
                      (42,017
                      )
                      
                      $
                      (2,920
                      )Balance
      sheet data:Total
      assets
                      
                      $
                      127,944
                      
                      
                      $
                      109,900Current
      Liabilities
                      
                      $
                      64,082
                      
                      
                      $
                      42,161Long-term
      obligations
                      
                      $
                      47,674
                      
                      
                      $
                      69,534
 
  Item
7. Management's Discussion and Analysis or Plan of Operations.
 
 The
following discussion and analysis of our results of operations should be read in
conjunction with our financial statements and related notes appearing elsewhere
in this prospectus.  This discussion and analysis contain
forward−looking statements that involve risks, uncertainties and
assumptions.  Actual results may differ materially from those
anticipated in these forward−looking statements as a result of certain factors,
including, but not limited to, those presented under the heading of “Risk
Factors” and elsewhere in this prospectus.
 
 Overview
 
 The
Company was incorporated in the State of Florida on July 7, 2006.  We
specialize in customized surface installation solutions for floors, walls and
other parts of the home using wood, glass, stone and ceramic tile in custom
designed homes throughout central Florida.
 
 YEARS
ENDED DECEMBER 31, 2008 AND DECEMBER 31, 2007
 
 Revenues
 Revenues
for the years ended December 31, 2008 and December 31, 2007 were $432,839 and
$557,085, respectively.
 
 Cost
of Sales
 Cost of sales for the years
ended December 31, 2008 and December 31, 2007 were $305,391 and $428,046,
respectively.
 
 In 2008
the officers of the company took dividends totaling in the amount of
$99,255.
 In 2007
the officers of the company took dividends totaling in the amount of
$159,348.
 
 5
  Income from
Operations
 
 During
the year ended December 31, 2008, we incurred a net loss of $42,017, as compared
with net loss of $2,920, for 2007, the decreased income being primarily
attributable to an increase in general and administrative expenses from
approximately $167,802 in 2008 to $129,827 in 2007, and a decrease in net sales
from $432,839 for the year ended December 31, 2008, to $557,085 for the year
ended December 31, 2007, coupled with a decrease in cost of sales from $305,391
in 2008 to $428,046 in 2007.
 The 23%
decrease in sales for the year ended December 31, 2008, was primarily due to a
decrease in new home sales, used home remodeling and construction
markets.  We also had a decrease in the cost of sales, but this
decrease was proportionate to the decrease in gross sales.  Our
increase in general and administrative expenses in 2008 is attributable to many
factors that were not present in the previous year including legal expenses of
$7,666, accounting and auditing expenses involved with the filing of a
registration statement with the Securities and Exchange Commission of $39,411.
We also had an additional expense for stock issued to consultants for services
of $13,808.
 
 For the
year ended December 31, 2008, we incurred an overall decrease in net income due
to a substantial increase in general and administrative expenses as compared to
the overall increase in gross sales.  The decrease in sales was
primarily due to a decrease in sales of the housing market in our area of
operation, a decrease in new home building and used home remodeling construction
and a decrease in commercial construction, resulting in part from a decrease in
bank lending, an increase in the bank loan interest rates which decreased new
mortgages and the ability for current homeowners to finance
remodeling.  The construction slowdown also increased the number of
local companies available to compete for jobs as well as decreased the profit
margins of companies trying to compete in the declining market.
 Liquidity and Capital
Resources
 
 We had
working capital deficit of $16,912 and stockholders' equity in the amount of
$89,105 at December 31, 2008.
 
 We have
three outstanding loans for company trucks of which total outstanding balance of
$71,152 was owed as of December 31, 2008, and payments totaling $1,917 per month
are as follows: for the 2006 Toyota Tundra purchased in December 2006 the
monthly payment is $626.95 monthly payment for a 60 month term; for the 2006
Toyota Tundra purchased in December 2006 the monthly payment is $626.95 monthly
payment for a 60 month term; and for the 2006 Toyota Tundra purchased in January
2007 the monthly payment is $642.54 for a 66 month term.
 
 Currently
our only sources of liquidity are from our service revenues.  At
present time we have no other sources of cash other than from our
operations.  To increase our cash on hand we would have to increase
our service revenue or cut our expenses.
 
 Presently
we have no external sources of liquidity.
 
 We
estimate that we will require additional capital in an amount of $50,000 or
greater to ensure that our business will operate profitably and be able to
expand in the current housing environment in Florida.  Additional
capital would be used to increase our marketing efforts to developers, builders
and construction companies similar to those with which we work
now.  It would also be used to increase the geographic range of our
current advertising campaigns by producing more marketing materials such as the
brochures which we currently use and possibly targeted direct
mail.  Additional capital could also be used to purchase construction
vehicles and/or equipment enabling us to increase the number and scope of
projects we work on.
 
 
 
 Off−Balance Sheet
Arrangements
 
 We have
not entered into any off−balance sheet arrangements that have or are reasonably
likely to have a current or future effect on our financial condition, changes in
financial condition, revenues or expenses, results of operations, liquidity,
capital expenditures or capital resources and would be considered material to
investors.
 
 Inflation
 
 It is the
opinion of the Company that inflation has not had a material effect on its
operations.
 
 6
  Critical Accounting Policies
and Estimates
 
 The
discussion and analysis of our plan of operations is based upon our consolidated
financial statements, which have been prepared in accordance with accounting
principles generally accepted in the United States of America. The preparation
of our consolidated financial statements requires us to make estimates and
assumptions that affect our reported results of operations and the amount of
reported assets and liabilities.
 
 Some
accounting policies involve judgments and uncertainties to such an extent that
there is reasonable likelihood that materially different amounts could have been
reported under different conditions, or if different assumptions had been used.
Actual results may differ from the estimates and assumptions used in the
preparation of our consolidated financial statements.
 Note 1 to
our audited Financial Statements included in this Registration Statement
discusses of the most significant policies we apply, or intend to apply, in
preparing our consolidated financial statements, some of which are subject to
alternative treatments under accounting principles generally accepted in the
United States of America.
 
 The
principal accounting policy potentially subject to change as a result of our
business operations is that relating to the treatment of our receivables and the
related allowance for doubtful accounts that would be shown on our balance
sheet. Our allowance for doubtful accounts is estimated based on the Company’s
historical losses, the existing economic conditions in the construction industry
and the financial ability of its customers.  The Company believes that
no allowance for doubtful accounts is necessary at December 31, 2007 and 2006,
nor at September 30, 2008. However, in the future we may have to make provision
for an allowance for doubtful accounts depending on the financial strength of
the customers that owe us payments, as well as our estimate of economic
conditions generally in the areas where we operate.
 
 
 
 New Financial Accounting
Standards
 
 In
February 2008, the FASB issued FASB Staff Position SFAS 157-1, “Application
of SFAS No. 157 to SFAS No. 13 and Its Related Interpretative Accounting
Pronouncements that Address Leasing Transactions” (“FSP SFAS 157-1”) and FASB
Staff Position SFAS 157-2, “Effective Date of SFAS No. 157” (“FSP SFAS
157-2”). FSP SFAS 157-1 excludes SFAS No. 13 and its related interpretive
accounting pronouncements that address leasing transactions from the
requirements of SFAS No. 157, with the exception of fair value measurements of
assets and liabilities recorded as a result of a lease transaction but measured
pursuant to other pronouncements within the scope of SFAS No. 157. FSP SFAS
157-2 delays the effective date of SFAS No. 157 for all nonfinancial assets and
nonfinancial liabilities, except those that are recognized or disclosed at fair
value in the financial statements on a recurring basis (at least annually). FSP
SFAS 157-1 and FSP SFAS 157-2 became effective for the Company upon adoption of
SFAS No. 157 on January 1, 2008. The Company will provide the additional
disclosures required relating to the fair value measurement of nonfinancial
assets and nonfinancial liabilities when it fully implements SFAS No. 157 on
January 1, 2009, as required, and does not believe they will have a significant
impact on its financial statements.
  In
February 2007, the FASB issued SFAS No. 159  “The Fair Value Option
for Financial Assets and Financial Liabilities,” (“SFAS 159”) providing
companies with an option to report selected financial assets and liabilities at
fair value.  The standard’s objective is to reduce both complexity in
accounting for financial instruments and the volatility in earnings caused by
measuring related assets and liabilities differently.  It also
requires entities to display the fair value of those assets and liabilities for
which the Company has chosen to use fair value on the face of the balance
sheet.  SFAS 159 is effective for fiscal years beginning after
November 15, 2007.  The adoption of SFAS 159 did not have a material
impact on the Company’s financial statements.
  In
December 2007, the FASB issued SFAS No. 141 (revised 2007) (“SFAS 141 (R)”)
“Business Combinations”, which replaces SFAS 141 “Business
Combinations”.  This Statement improves the relevance, completeness
and representational faithfulness of the information provided in financial
reports about the assets acquired and the liabilities assumed in a business
combination.  This Statement requires an acquirer to recognize the
assets acquired, the liabilities assumed, and any noncontrolling interest in the
acquiree at the acquisition date, measured at their fair values as of that date,
with limited exceptions specified in the Statement.  Under SFAS
141(R), acquisition-related costs, including restructuring costs, must be
recognized separately from the acquisition and will generally be expensed as
incurred.  That replaces SFAS 141’s cost-allocation process, which
required the cost of an acquisition to be allocated to the individual assets
acquired and liabilities assumed based on their estimated fair
values.  SFAS 141(R) shall be applied prospectively to business combinations
for which the acquisition date is on or after the beginning of the first annual
report period beginning on or after December 15, 2008.  The Company
will implement this Statement in 2009.
  7
  Item
7A. Quantitative and Qualitative Disclosures About Market Risk.
 
 Commodity
Risk – Our raw material costs for our installations, in the normal course of
business, could be affected by increased commodity prices for tile, stone, wood
and other materials that we use.
 
 Credit
Risk - Our accounts receivables are subject, in the normal course of business,
to collection risks. We regularly assess these risks and have established
policies and business practices to protect against the adverse effects of
collection risks. As a result we do not anticipate any material losses in this
area.
 
   8
  Item
8. Financial Statements and Supplementary Data.
  
 
 
 
 
 
 
 
 ROYAL
STYLE DESIGN, INC.
 FINANCIAL
STATEMENTS
 December
31, 2008 and 2007
 
 
 
 
 
 
 
 
 
 
 
 9
  TABLE
OF CONTENTS
 
 
 PageReport
      of Independent Registered Public Accounting Firm
                                
                                
                                11Consolidated
      balance sheet
                                
                                
                                12Consolidated
      statements of operations
                                
                                
                                13Consolidated
      statements of stockholders’ equity
                                
                                
                                14Consolidated
      statements of cash flows
                                
                                
                                15Notes
      to consolidated financial statements
                                
                                
                                16-21
    
 10
  Ten
      Industrial Way East, Suite 2, Eatontown, NJ 07724 (732) 544-8111 Fax (732)
      544-8788 E-mail: tax @wgpc.net
 Wiener,
      Goodman
                            &
      Company, P.C.Certified
      Public Accountants
                              &
      ConsultantsMemberships
                            SEC
      Practice Section of AICPA
                            PCPS
      of AICPA
                            American
      Institute of CPA
                            New
      Jersey Society of CPA
                          Joel
      Wiener, CPA
                            Gerald
      Goodman.
CPA
 
  REPORT OF
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
  Board of
Directors
  Royal
Style Design, Inc.
 Altamonte
Springs, FL 32701
  We have
audited the accompanying balance sheet of Royal Style Design, Inc.
(collectively, the "Company") as of December 31, 2008 and 2007, and the related
statements of operations, stockholders' equity (deficiency) and cash flows for
the years ended December 31, 2008 and 2007. These 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 the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the 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 financial statements referred to above present fairly, in all
material respects, the financial position of the Company as of December 31, 2008
and 2007, and the results of its operations and its cash flows for the years
then ended, in conformity with accounting principles generally accepted in the
United States of America.
  
  Wiener,
Goodman & Company, P.C.
 Eatontown,
New Jersey
  March 13,
2009
 
 
 11
  ROYAL
      STYLE DESIGN, INC.BALANCE
      SHEETDecember
      31,2008
                                                                    
                                                                    2007ASSETSCurrent
      Assets:Cash
                                                                    
                                                                    $
                                                                    858
                                                                    
                                                                    
                                                                    $
                                                                    12,070Accounts
      receivable
                                                                    
                                                                    
                                                                    14,738
                                                                    
                                                                    
                                                                    
                                                                    9,149Prepaid
      expenses
                                                                    
                                                                    
                                                                    46,192
                                                                    
                                                                    
                                                                    
                                                                    -Total
      Current Assets
                                                                    
                                                                    
                                                                    61,788
                                                                    
                                                                    
                                                                    
                                                                    21,219Property
      and equipment-net
                                                                    
                                                                    
                                                                    65,731
                                                                    
                                                                    
                                                                    
                                                                    88,256Other
      assets
                                                                    
                                                                    
                                                                    425
                                                                    
                                                                    
                                                                    
                                                                    425Total
      Assets
                                                                    
                                                                    $
                                                                    127,944
                                                                    
                                                                    
                                                                    $
                                                                    109,900LIABILITIES
      AND STOCKHOLDERS' EQUITY (DEFICIENCY)Current
      Liabilities:Accounts
      payable
                                                                    
                                                                    $
                                                                    11,770
                                                                    
                                                                    
                                                                    $
                                                                    20,071Accrued
      expenses
                                                                    
                                                                    
                                                                    28,834
                                                                    
                                                                    
                                                                    
                                                                    2,532Current
      portion of long-term debt
                                                                    
                                                                    
                                                                    23,478
                                                                    
                                                                    
                                                                    
                                                                    19,558Total
      Current Liabilities
                                                                    
                                                                    
                                                                    64,082
                                                                    
                                                                    
                                                                    
                                                                    42,161Long-term
      Liabilities:Long-term
      debt - less current portion above
                                                                    
                                                                    
                                                                    47,674
                                                                    
                                                                    
                                                                    
                                                                    69,534Total
      Liabilities
                                                                    
                                                                    
                                                                    111,756
                                                                    
                                                                    
                                                                    
                                                                    111,695Stockholders'
      Equity (Deficiency):Preferred
      Stock, $.001 par value; authorized10,000,000
      shares; 0 shares issued and
                                                                      outstanding
      at December 31, 2008 and 2007,
                                                                      respectivelyCommon
      Stock, $.001 par value; authorized100,000,000
      shares; 4,500,000 and 3,000,000
                                                                      shares
      issued and outstanding at December 31,
                                                                      2008
      and 2007, respectively
                                                                    
                                                                    
                                                                    4,500
                                                                    
                                                                    
                                                                    
                                                                    3,000Additional
      paid-in capital
                                                                    
                                                                    
                                                                    56,625
                                                                    
                                                                    
                                                                    
                                                                    (1,875
                                                                    )Deficit
                                                                    
                                                                    
                                                                    (44,937
                                                                    )
                                                                    
                                                                    
                                                                    (2,920
                                                                    )Total
      Stockholders' Equity (Deficiency)
                                                                    
                                                                    
                                                                    16,188
                                                                    
                                                                    
                                                                    
                                                                    (1,795
                                                                    )Total
      Liabilities andStockholders'
      Equity (Deficiency)
                                                                    
                                                                    $
                                                                    127,944
                                                                    
                                                                    
                                                                    $
                                                                    109,900
  See Notes
to Consolidated Financial Statements
  12
  ROYAL
      STYLE DESIGN, INC.STATEMENT
      OF OPERATIONSYears
      endedDecember
      31,2008
                        
                        
                        2007Net
      sales:Revenue
                        
                        $
                        432,839
                        
                        
                        $
                        557,085Cost
      and expenses:Cost
      of Sales  (exclusive of depreciation
                        
                        
                        305,391
                        
                        
                        
                        428,046and
      amortization shown separately
                          below)General
      and administrative
                        
                        
                        145,275
                        
                        
                        
                        107,630Depreciation
      and amoritization expense
                        
                        
                        22,527
                        
                        
                        
                        22,197473,193
                        
                        
                        
                        557,873Loss
      from operations
                        
                        
                        (40,354
                        )
                        
                        
                        (788
                        )Interest
      expense
                        
                        
                        1,946
                        
                        
                        
                        2,132Interest
      income
                        
                        
                        (283
                        )
                        
                        
                        -1,663
                        
                        
                        
                        2,132Net
      loss before provision for income taxes
                        
                        
                        (42,017
                        )
                        
                        
                        (2,920
                        )Provision
      for income taxes
                        
                        
                        -
                        
                        
                        
                        -Net
      loss
                        
                        $
                        (42,017
                        )
                        
                        $
                        (2,920
                        )Loss
      per common share - basic and diluted
                        
                        $
                        (0.01
                        )
                        
                        $
                        (0.00
                        )Weighted
      average number of common stock sharesoutstanding
      - basic and diluted
                        
                        
                        3,341,096
                        
                        
                        
                        3,000,000
  See Notes
to Consolidated Financial Statements
  13
  ROYAL
      STYLE DESIGN, INC.STATEMENT
      OF STOCKHOLDERS' EQUITY (DEFICIENCY)AdditionalNumber
      of
                                    
                                    
                                    
                                    
                                    
                                    Paid-in
                                    
                                    
                                    Retained
      EarningsCommon
      Shares
                                    
                                    
                                    Common Stock
                                    
                                    
                                    Capital
                                    
                                    
                                    (Deficit)
                                    
                                    
                                    TotalBalance,
      January 1, 2007
                                    
                                    
                                    3,000,000
                                    
                                    
                                    $
                                    3,000
                                    
                                    
                                    $
                                    (2,700
                                    )
                                    
                                    $
                                    825
                                    
                                    
                                    $
                                    1,125Undistributing
      earnings
                                      of
      S Corporationreclassified
      to paid in
                                      capital
                                    
                                    
                                    
                                    
                                    
                                    
                                    
                                    
                                    
                                    
                                    825
                                    
                                    
                                    
                                    (825
                                    )Net
      loss
                                    
                                    
                                    -
                                    
                                    
                                    
                                    -
                                    
                                    
                                    
                                    -
                                    
                                    
                                    
                                    (2,920
                                    )
                                    
                                    
                                    (2,920
                                    )Balance,
      December 31, 2007
                                    
                                    
                                    3,000,000
                                    
                                    
                                    
                                    3,000
                                    
                                    
                                    
                                    (1,875
                                    )
                                    
                                    
                                    (2,920
                                    )
                                    
                                    
                                    (1,795
                                    )Common
      stock issued
                                      for
      consulting
                                    
                                    
                                    1,500,000
                                    
                                    
                                    
                                    1,500
                                    
                                    
                                    
                                    58,500
                                    
                                    
                                    
                                    -
                                    
                                    
                                    
                                    60,000services
      (value of the
                                      considerationreceived)Net
      loss
                                    
                                    
                                    -
                                    
                                    
                                    
                                    -
                                    
                                    
                                    
                                    -
                                    
                                    
                                    
                                    (42,017
                                    )
                                    
                                    
                                    (42,017
                                    )Balance,
      December 31, 2008
                                    
                                    
                                    4,500,000
                                    
                                    
                                    $
                                    4,500
                                    
                                    
                                    $
                                    56,625
                                    
                                    
                                    $
                                    (44,937
                                    )
                                    
                                    $
                                    16,188
  See Notes
to Consolidated Financial Statements
  14
  ROYAL
      STYLE DESIGN, INC.STATEMENT
      OF CASH FLOWSYears
      EndedDecember
      31,2008
                            
                            
                            2007Cash
      flows from operating activities:Net
      loss
                            
                            $
                            (42,017
                            )
                            
                            $
                            (2,920
                            )Adjustments
      to reconcile net cashprovided
      by operating activities:Depreciation
      and amortization
                            
                            
                            22,526
                            
                            
                            
                            22,197Non
      - cash compensation
                            
                            
                            13,808
                            
                            
                            
                            -Changes
      in operating assets andliabilities:Increase
      in accounts receivable
                            
                            
                            (5,589
                            )
                            
                            
                            (5,149
                            )Increase
      in other assets
                            
                            
                            -
                            
                            
                            
                            (425
                            )Increase
      in accounts payable and accrued expenses
                            
                            
                            18,001
                            
                            
                            
                            19,651Net
      cash provided by operatingactivities
                            
                            
                            6,729
                            
                            
                            
                            33,354Cash
      flows from investing activities:Purchase
      of property and equipment
                            
                            
                            -
                            
                            
                            
                            (2,479
                            )Cash
      flows from financing activities:Repayment
      of debt
                            
                            
                            (17,941
                            )
                            
                            
                            (19,781
                            )Net
      (decrease) increase in cash
                            
                            
                            (11,212
                            )
                            
                            
                            11,094Cash-beginning
      of year
                            
                            
                            12,070
                            
                            
                            
                            976Cash-end
      of year
                            
                            $
                            858
                            
                            
                            $
                            12,070Supplementary
      information:Cash
      paid during the year for:Interest
                            
                            $
                            1,946
                            
                            
                            $
                            2,132Income
      taxes
                            
                            $
                            -
                            
                            
                            $
                            -Non-Cash
      Financing Activities:Issuance
      of common stock for services
                            
                            $
                            60,000
                            
                            
                            
                            -
  See Notes
to Consolidated Financial Statements
  15
  ROYAL
STYLE DESIGN, INC.
 
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 
 
 
 1. DESCRIPTION
OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES
 Organization
 
 Royal
Style Design, Inc. (the “Company” or “Royal Style Design”) was incorporated in
the State of Florida in July, 2006.  Royal Style Design specializes in
customized solutions and installations in stone and tile in customized design
homes in Central Florida.
 
 Significant
Accounting Policies
 
 Principles
of Preparation of Financial Statements
 The
financial statements of the Company are prepared using the accrual method of
accounting.
 
 
 Use of
Estimates
 
 The
preparation of the financial statements in conformity with accepted accounting
principles generally accepted in the United States of America requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period.  Examples include estimates of
costs to complete performance contracts, income tax exposures and valuation
allowances.  Actual results could differ from those
estimates.
 
 
 Revenue
Recognition
 
 The
Company recognizes revenue in accordance with the guidance contained in SEC
Staff Bulletin No. 104, "Revenue Recognition in Financial Statements" ("SAB No.
104"). Revenue is recognized as each stage is completed, based upon a percentage
of the projected costs.  There are no customer acceptance provisions
in our sales contracts. The majority of the Company’s revenue has been received
from developers.
 
 
 Receivables
 
 Receivables
are recorded when invoices are issued and are presented in the balance sheet net
of allowances for doubtful accounts.  Receivables are written off when
they are determined to be uncollectible.  The allowance for doubtful
accounts is estimated based on the Company’s historical losses, the existing
economic conditions in the construction industry and the financial ability of
its customers.  The Company believes that no allowance for doubtful
accounts is necessary at December 31, 2008 and 2007.
 
 
 Cost of
Sales
 
 Included
in cost of sales are subcontractors, payroll, payroll taxes, workman
compensation insurance and materials.
 
 
 General and Administrative
Expenses
 
 Included
in general and administrative expenses are payroll, automobile expenses,
insurance, telephone, professional fees, office expenses and other minor
miscellaneous expenses.
 
 16
  Depreciation
 
 Property
and equipment is carried at cost. Depreciation is computed using the
straight-line method over the estimated useful lives of the assets. For income
tax purposes, depreciation is recorded using accelerated methods of cost
recovery over statutory recovery periods.
 DepreciableAsset
                    
                    LivesVehicles
                    
                    5
      yearsOffice
      equipment
                    
                    5
      years
 
 
 Income
Taxes
 
 Prior to
January 1, 2007, the Company was an “S” Corporation, as defined by the Internal
Revenue Service Code Section and, accordingly, any income or losses would flow
directly to the stockholders.
 
 The
undistributed earnings of the S Corporation prior to January 1, 2007 have been
reclassified to additional paid in capital.
 
 The
Company accounts for income taxes using an asset and liability approach under
which deferred income taxes are recognized by applying enacted tax rates
applicable to future years to the differences between the financial statement
carrying amounts and the tax bases of reported assets and
liabilities.
 
 The
principal items giving rise to deferred taxes are the use of accelerated
depreciation methods for machinery and equipment and the carry forward of net
operating losses.
 
 
 Evaluation of Long-Lived
Assets
 
 The
Company reviews property and equipment for impairment whenever events or changes
in circumstances indicate the carrying value may not be recoverable in
accordance with guidance in SFAS No. 144 "Accounting for the Impairment or
Disposal of Long-Lived Assets."  If the carrying value of the
long-lived asset exceeds the present value of the related estimated future cash
flows, the asset would be adjusted to its fair value and an impairment loss
would be charged to operations in the period identified.
 
 
 Concentration of Credit
Risk
 
 Financial
instruments which potentially subject the Company to concentrations of credit
risk consist principally of cash and accounts receivable.
 
 The
Company's cash and cash equivalents are concentrated primarily in one bank in
the United States.  At times, such deposits could be in excess of
insured limits.  Management
 believes
that the financial institution that holds the Company financial instrument is
financially sound and, accordingly, minimal credit risk is believed to exist
with respect to these financial instruments.
 
 The
Company grants credit to customers based on an evaluation of the customer’s
financial condition, without requiring collateral.  Exposure to losses
on receivables is principally dependent on each customer’s financial
condition.  The Company controls its exposure to credit risk due to
normally dealing with the same contractors and receiving payment for materials
prior to completion of the services.
 
 
 Earnings Per
Share
 
 Basic
loss per share is computed by dividing net loss by the weighted average number
of common shares outstanding during the specified period. Diluted loss per
common share is computed by dividing net loss by the weighted average number of
common shares and potential common shares during the specified period. For the
years ended December 31, 2008 and 2007, there were no potential shares
outstanding.
  17
  New Financial Accounting
Standards
  
 In
September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements”, which
enhances existing guidance for measuring assets and liabilities using fair
value.  This Standard provides a single definition of fair value,
together with a framework for measuring it, and requires additional disclosure
about the use of fair value to measure assets and
liabilities.    In February 2008, the FASB issued FASB
Staff Position SFAS 157-1, “Application of SFAS No. 157 to SFAS No. 13 and Its
Related Interpretative Accounting Pronouncements that Address Leasing
Transactions” (“FSP SFAS 157-1”) and FASB Staff Position SFAS 157-2, “Effective
Date of SFAS No. 157” (“FSP SFAS 157-2”). FSP SFAS 157-1 excludes SFAS No.
13 and its related interpretive accounting pronouncements that address leasing
transactions from the requirements of SFAS No. 157, with the exception of fair
value measurements of assets and liabilities recorded as a result of a lease
transaction but measured pursuant to other pronouncements within the scope of
SFAS No. 157. FSP SFAS 157-2 delays the effective date of SFAS No. 157 for
all nonfinancial assets and nonfinancial liabilities, except those that are
recognized or disclosed at fair value in the financial statements on a recurring
basis (at least annually). FSP SFAS 157-1 and FSP SFAS 157-2 became effective
for the Company upon adoption of SFAS No. 157 on January 1, 2008. The Company
will provide the additional disclosures required relating to the fair value
measurement of nonfinancial assets and nonfinancial liabilities when it
completes its implementation of SFAS No. 157 on January 1, 2009, as required,
and does not believe they will have a significant impact on its financial
statements.
 
 In February 2007, the FASB issued SFAS
No. 159 (“SFAS 159”) “The Fair Value Option for Financial Assets and Financial
Liabilities”, providing companies with an option to report selected financial
assets and liabilities at fair value.  The Standard’s objective is to
reduce both complexity in accounting for financial instruments and the
volatility in earnings caused by measuring related assets and liabilities
differently.  It also requires entities to display the fair value of
those assets and liabilities for which the Company has chosen to use fair value
on the face of the balance sheet.  SFAS 159 is effective for fiscal
years beginning after November 15, 2007.  SFAS No. 159 did not have a
material impact on its financial statements.
  In June 2007, the Emerging Issues Task
Force of the FASB issued EITF Issue No. 07-3, "Accounting for Nonrefundable
Advance Payments for Goods or Services Received for Use in Future Research and
Development Activities," which is effective for calendar year companies on
January 1, 2008.  The Task Force concluded that nonrefundable advance
payments for goods or services that will be used or rendered for future research
and development activities should be deferred and capitalized.  Such
amounts should be recognized as an expense as the related goods are delivered or
the services are performed, or when the goods or services are no longer expected
to be provided.  EITF Issue No. 07-3 did not impact the Company’s
financial statements.
  In December 2007, the FASB issued SFAS
141(R), which replaces SFAS 141 “Business Combinations”.  This
Statement is intended to improve the relevance, completeness and
representational faithfulness of the information provided in financial reports
about the assets acquired and the liabilities assumed in a business
combination.  This Statement requires an acquirer to recognize the
assets acquired, the liabilities assumed, and any noncontrolling interest in the
acquiree at the acquisition date, measured at their fair values as of that date,
with limited exceptions specified in the Statement.  Under SFAS
141(R), acquisition-related costs, including restructuring costs, must be
recognized separately from the acquisition and will generally be expensed as
incurred.  That replaces SFAS 141’s cost-allocation process, which
required the cost of an acquisition to be allocated to the individual assets
acquired and liabilities assumed based on their estimated fair
values.  SFAS 141(R) shall be applied prospectively to business
combinations for which the acquisition date is on or after the beginning of the
first annual report period beginning on or after December 15,
2008.  The Company will adopt SFAS No. 141(R) on January 1, 2009, as
required, and does not believe it will have a material impact on its financial
statements.
  In May
2008, the FASB issued SFAS No. 162, “The Hierarchy of Generally Accepted
Accounting Principles” (“SFAS No. 162”).  SFAS No. 162 identifies the
sources of accounting principles and the framework for selecting the principles
to be used in the preparation of financial statements of nongovernmental
entities that are presented in conformity with generally accepted accounting
principles (GAAP) in the United States.  This Statement is effective
sixty days following the SEC’s approval of the Public Company Accounting
Oversight Board amendments to AU Section 411, “The Meaning of Present Fairly in
Conformity With Generally Accepted Accounting Principles.”  The
Company is currently evaluating the potential impact, if any, of the adoption of
SFAS No. 162 on its financial statements.
 
 18
  2.     
       PROPERTY and EQUIPMENT
 
  December
      31,2008
                        
                        
                        2007Office
      equipment
                        
                        $
                        2,479
                        
                        
                        $
                        2,479Vehicles
                        
                        
                        110,146
                        
                        
                        
                        110,146112,625
                        
                        
                        
                        112,625Less:
      accumulated depreciation
                        
                        
                        46,894
                        
                        
                        
                        24,369$
                        65,731
                        
                        
                        
                        88,256
 
 Depreciation
expense for the years ended December 31, 2008 and 2007 was $22,526 and $22,197,
respectively.
   3.          
  DEBT
  Long-term
debt consisted of the following:
   December
      31,2008
                                        
                                        
                                        2007Automobile
      loan, due to Southeast Toyota,no
      interest and monthly payment of $637This
      note matures December 2011
                                        
                                        $
                                        23,203
                                        
                                        
                                        $
                                        29,549Automobile
      loan, due to Southeast Toyota,no
      interest and monthly payment of $637This
      note matures December 2011
                                        
                                        
                                        22,577
                                        
                                        
                                        
                                        30,169Automobile
      loan, due to SunTrust Bank,interest
      of 7.11% per annum, monthly paymentof
      $643This
      note matures July 2012
                                        
                                        
                                        25,372
                                        
                                        
                                        
                                        29,37471,152
                                        
                                        
                                        
                                        89,092Less:
      Current portion
                                        
                                        
                                        (23,478
                                        )
                                        
                                        
                                        (19,558
                                        )$
                                        47,674
                                        
                                        
                                        $
                                        69,534
 
  Future
      minimum payments:
                            Year Ending December 31,2009
                            
                            $
                            23,0352010
                            
                            
                            21,6902011
                            
                            
                            22,1782012
                            
                            
                            4,249$
                            71,152
  Interest
expense for the years ended December 31, 2008 and 2007 amounted to $1,946 and
$2,132, respectively.
 
 19
  4.       
     COMMON STOCK
 
 The
Articles of Incorporation of the Company as originally filed on July 7, 2006
provided for authorized capital stock of 100 shares of common stock, par value
$.10 per share.  On July 10, 2006, the Company issued one share of
common stock to each of the three founding stockholders.  Effective
September 2008, the Company amended its articles of incorporation to increase
the number of authorized common stock to 100,000,000 shares of common stock, par
value $.001 per share; to authorize a new class of preferred stock, par value
$.001 per share; and to change each of the three outstanding shares of common stock,
par value $.10 per share, into 1,000,000 shares of common stock, par value $.001
per share.  All share and per share information have been revised to
give retroactive effect to the stock split.
 
 On
October 9, 2008, the Company issued 500,000 shares of common stock valued at
$20,000 (the fair value of the consideration received) to Alexander Sorokoumov,
the father of Ivan Sorokoumov, Chief Financial Officer, for consulting services
to be performed in the area of business growth and development.  The
term for the consulting services is for a period of one year, and the expense
for the year ended December 31, 2008 was $4,603.
 
 On
October 9, 2008, the Company issued 500,000 shares of common stock valued at
$20,000 (the fair value of the consideration received) to each Nikolaj Uraev and
Iossif Yenikeyev for consulting services to be performed in the area of business
growth and development.  The term for the consulting services is for a
period of one year, and the expense for the year ended December 31, 2008 was
$9,025.
 
 
 5. INCOME
TAXES
 
 The
Company adopted the provisions of Financial Interpretation No. 48, “Accounting
for Uncertainty in Income Taxes”, (“FIN 48”) on January 1, 2007.  As a
result of the implementation of FIN 48, the Company recognized no adjustment in
the net liability for unrecognized income tax benefits.
 
 
 The
reconciliation of the effective income tax rate to the federal statutory rate is
as follows:
  For
      the Years EndedDecember
      31,2008
                                  
                                  
                                  2007Benefits
      computed at the
                                  
                                  $
                                  (14,706
                                  )
                                  
                                  $
                                  (1,022
                                  )statutory
      rateState
      and local income taxes, net of
                                  
                                  
                                  -
                                  
                                  
                                  
                                  -federal
      benefitEffect
      of unused operating losses
                                  
                                  
                                  14,706
                                  
                                  
                                  
                                  1,022$
                                  -
                                  
                                  
                                  $
                                  -
 At
December 31, 2008, the Company has a net operating loss carry forward of
approximately $45,000 which expires in various years though 2020. Deferred
income taxes reflect the impact of the net operating loss carry forwards. In
recognition of the uncertainty regarding the ultimate amount of tax benefits to
be derived from the Company’s net operating loss carry forwards, the Company has
recorded a valuation allowance for the entire amount of the deferred
asset.
 
 
 6.           
 Major Customers
 
 The
Company had sales in excess of ten percent of sales to three customers in 2008
and four customers in 2007. The amount and percentages of the company sales to
these customers in each year were $123,324 (28%), $82,209 (19%) and $67,995
(16%) in 2008 and $115,655 (21%), $109,408 (20%), $96,044 (17%) and $82,509
(15%) in 2007.  Management believes that the loss of such customers
could have a material adverse effect on the Company result of operation,
financial position and cash flow.
 
 20
  7.          Commitments
and Contingencies
 
 
 The
Company conducts its operations from a leased property in
Florida.  The lease requires the Company to pay certain executive
costs (such as insurance and maintenance).
  
 Future
minimum lease payments for operating leases are approximately as
follows:
  Years
      EndingDecember
      31,
                        
                        Amount2009
                        
                        $
                        5,5202010
                        
                        
                        5,520$
                        11,040
  Total
rent expense was approximately $5,520 and $3,819 for the years ended December
31, 2008 and December 31, 2007, respectively.
 
 21
  Item
9. Changes In and Disagreements With Accountants on Accounting and Financial
Disclosure.
  None.
  Item
9A (T). Controls and Procedures.
  
 As
supervised by our board of directors and our principal executive and principal
financial officers, management has established a system of disclosure controls
and procedures and has evaluated the effectiveness of that
system.  The system and its evaluation are reported on in the below
Management's Annual Report on Internal Control over Financial
Reporting.  Our principal executive and  financial officer
has concluded that our disclosure controls and procedures (as defined in the
1934 Securities Exchange Act Rule 13a-15(e)) as of December 31, 2008, are
effective, based on the evaluation of these controls and procedures required by
paragraph (b) of Rule 13a-15.
 
 Management's
Annual Report on Internal Control over Financial Reporting
 
 Management
is responsible for establishing and maintaining adequate internal control over
financial reporting, as such term is defined in Rule 13a-15(f) of the Securities
Exchange Act of 1934 (the "Exchange Act").  Internal control over
financial reporting is a process designed to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of
financial statements for external purposes in accordance with U.S. generally
accepted accounting principles.
 
 Management
assessed the effectiveness of internal control over financial reporting as of
December 31, 2008. We carried out this assessment using the criteria of the
Committee of Sponsoring Organizations of the Treadway Commission (COSO) in
Internal Control—Integrated Framework. Management concluded in this assessment
that as of December 31, 2008, our internal control over financial reporting is
effective.
 
 This
annual report does not include an attestation report of our registered public
accounting firm regarding internal control over financial
reporting.  Management's report was not subject to attestation by our
registered public accounting firm, pursuant to temporary rules of the Securities
and Exchange Commission that permit us to provide only management's report in
this annual report.
 
 There
have been no significant changes in our internal control over financial
reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act)
during the fourth quarter of 2008 that have materially affected, or are
reasonably likely to materially affect, our internal control over financial
reporting.
 
  Item
9B. Other Information.
   None.
  22
  PART
III
  Item
10. Directors, Executive Officers, and Corporate Governance.
 
 We have
three officers and directors as follows:
 
 Name
                          Age
                          Positions
      and Offices HeldNikolay
      Lobachev
                          27
                          President,
      Chief Executive Officer
                            and
      DirectorIvan
      Sorokoumov
                          26
                          Chief
      Financial Officer and DirectorDmitry
      Terikov
                          26
                          Chief
      Operating Officer, Secretary
                            and
      Director
 
 Our
Officer and Directors:
 
 Nikolay
Lobachev
 
 Mr.
Nikolay Lobachev, 27, graduated from Moscow State Open University in Russia with
a Bachelors Degree in Law.  He is currently the President, Chief
Executive Officer and a director of the Company.  He has held these
positions since July 2006, when he became one of the three original founding
shareholders of the Company, and from March 2005 to July 2006 operated an
installation and remodeling business in the Orlando area, which was the
predecessor business to the Company’s business.  From August 2004 to
March 2005 Mr. Lobachev worked as a manager for Daynova LLC, a construction
company located in Orlando, Florida.  Prior to that Mr. Lobachev was
as a consultant for Garant Ltd., a legal advice office in Moscow, Russia from
June 2001 to May 2003.  He is also bilingual, speaking fluent Russian
and English.
 
 Ivan
Sorokoumov
 
 Mr. Ivan
Sorokoumov, 26, is presently the Chief Financial Officer and a director of the
Company.  He has been a director of the Company since July, 2006 when
he became one of the three original founding shareholders of the Company, and
from March 2005 to July 2006 worked with an installation and remodeling business
that was the predecessor business to the Company’s business.  From
August 2004 to March 2005 Mr. Sorokoumov was the CEO and Co-owner of Daynova
LLC, a construction company located in Orlando, Florida.  From June
2001, Mr. Sorokoumov worked as a Design Administrator for Air Flow Design Inc.,
also located in Orlando, Florida. He resigned from that position in August
2003.  From 1999 until 2001 Mr. Sorokoumov attended Zaoksky Adventist
University located in Zaoksky, Russia. His major areas of study were accounting
and economics.  He is fluent in both Russian and English.
 
 Dmitry
Terikov
 
 Mr.
Dmitry Terikov, 26, is presently the Chief Operating Officer and a director of
the Company.  He has been a director of the Company since July, 2006
when he became one of the three original founding shareholders of the Company,
and from March 2005 to July 2006 worked with an installation and remodeling
business that was the predecessor business to the Company’s business. From
August 2004 to March 2005 Mr. Terikov worked as project manager for Daynova LLC,
a construction company located in Orlando, Florida.  From August 2000
until March 2002 Mr. Terikov was the General Manager of Silikat Ltd, a brick and
paver factory located in Zaoksky, Russia.  In June 1997, Mr. Terikov
was a director for Luch Ltd, a commercial property development company located
in Krasnodar, Russia.  He resigned from that position in August
2000.  From 2000 until 2002 Mr. Terikov attended Zaoksky Adventist
University located in Zaoksky, Russia.  He received honors while
studying for his Major in Business Administration.  He is fluent in
both Russian and English.
 
 EMPLOYMENT
AGREEMENTS
 
 At this
time, we have no employment agreements in effect with any of our executives or
employees.
 
 
 AUDIT
COMMITTEE
 
 We do not
have a separate Audit Committee. Our Board of Directors performs the functions
usually designated to an Audit Committee.
 
 23
 
 CODE OF
CONDUCT
 
 We are
reviewing a corporate code of conduct and a corporate disclosure policy, which
will provide for internal procedures concerning the reporting and disclosure of
corporate matters that are material to our business and to our stockholders. Our
corporate code of conduct will include a code of ethics for our officers and
employees as to workplace conduct, dealings with customers, compliance with
laws, improper payments, conflicts of interest, insider trading, company
confidential information, and behavior with honesty and integrity. Our corporate
disclosure policy includes guidelines for publicly disseminating financial and
other material developments to the investing public.
  
 COMPLIANCE
WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF 1934
 
 Section
16(a) of the Securities Exchange Act of 1934, as amended, requires the Company's
directors and executive officers and persons who own more than 10% of a
registered class of the Company's equity securities to file various reports with
the Securities and Exchange Commission concerning their holdings of, and
transactions in, securities of the Company.  Copies of these filings
must be furnished to the Company.
 
 Mr.
Nikolay Lovachev, our President, Chief Executive Officer and director, Mr. Ivan
Sorokoumov, our Chief Financial Officer and director, our Chief Operating
Officer and director were required to file Form 3’s on February 18,
2009.  Such forms will be filed shortly.
  Item
11. Executive Compensation.
  
 
 SUMMARY
COMPENSATION TABLE
 
 
 Name
      and
                                                                                                      Principal
                                                                                                      Position
                                                                                                    Year
                                                                                                    Salary
                                                                                                      ($)
                                                                                                    Bonus
                                                                                                      ($)
                                                                                                    Stock
                                                                                                      Awards
                                                                                                      ($)
                                                                                                    Option
                                                                                                      Awards
                                                                                                      ($)
                                                                                                    Non-Equity
                                                                                                      Incentive
                                                                                                      Plan
                                                                                                      Compens-
                                                                                                      ation
                                                                                                      ($)
                                                                                                    Change
      in
                                                                                                      Pension
                                                                                                      Value
      and
                                                                                                      Nonquali-
                                                                                                      fied
                                                                                                      Deferred
                                                                                                      Compensation
                                                                                                      Earnings
                                                                                                    All
      Other
                                                                                                      Compen-
                                                                                                      sation
                                                                                                    Total
                                                                                                      ($)(a)
                                                                                                    (b)
                                                                                                    (c)
                                                                                                    (d)
                                                                                                    (e)
                                                                                                    (f)
                                                                                                    (g)
                                                                                                    (h)
                                                                                                    (i)
                                                                                                    (j)Nikolay
      Lobachev, President and Chief Executive Officer
                                                                                                    2007
                                                                                                    $64,432
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    $64,4322008
                                                                                                    $33,085
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    $33,085Ivan
      Sorokoumov, Chief Financial Officer
                                                                                                    2007
                                                                                                    $61,904
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    $61,9042008
                                                                                                    $33,085
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    $33,085Dmitry
      Terikov, Chief Operating Officer
                                                                                                    2007
                                                                                                    $81,012
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    $81,0122008
                                                                                                    $33,085
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    
                                                                                                    $33,085
 
 24
 
 The
Company has no stock option or other executive compensation plans.
 
 The
Company does not compensate its three directors separately for services
performed in their capacity as directors.
 
  Item
12. Security Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters.
  
 The
following table sets forth, as of January 1, 2008, each person known by us to be
the beneficial owner of five percent or more of the Company's voting Stock, all
directors individually and all directors and officers of the Company as a group.
Except as noted, each person has sole voting and investment power with respect
to the shares shown. At December 1, 2008, 4,500,000 shares of common stock were
issued and outstanding.
  Name
                                Number
      of
                                  Shares
      Owned
                                  Beneficially
                                
                                Ownership
                                  Percentage
                                  of
      ClassNikolay
      Lobachev
                                  470
      Majestic Way
                                  Altamonte
      Springs, FL 32714
                                1,000,000
                                
                                22.2%Dmitry
      Terikov
                                  324
      Spring Leap Circle
                                  Winter
      Garden, FL 34787
                                1,000,000
                                
                                22.2%Ivan
      Sorokoumov
                                  573
      Setting Sun Drive
                                  Winter
      Garden, FL 34787
                                1,000,000
                                
                                22.2%Alexander
      Sorokoumov
                                  1240
      Winter Garden Vineland Road. #W1
                                  Winter
      Garden, FL 34787
                                500,000
                                
                                11.1%Nikolaj
      Uraev
                                  32
      Amirkhana Prospect, Apt. 63
                                  Kazan,
      Republic of Tatarstan 420132
                                500,000
                                
                                11.1%Iossif
      Yenikeyev
                                  375
      Palm Springs Dr., #1116
                                  Altamonte
      Springs, FL 32701
                                500,000
                                
                                11.1%All
      Officers and Directors as a Group (3 persons)
                                3,000,000
                                
                                66.6%
  The
Articles of Incorporation of the Company as originally filed on July 7, 2006
provided for authorized capital stock of 100 shares of common stock, par value
$.10 per shares.  On July 10, 2006, the Company issued one share of
common stock to each of the three founding stockholders.  Effective
October 9, 2008, the Company amended its articles of incorporation to increase
the number of authorized common stock to 100,000,000 shares of common stock, par
value $.001 per share; to authorize a new class of preferred stock, par value
$.001 per share; and to change each of the three outstanding shares of common
stock, par value $.10 per share, into 1,000,000 shares of common stock, par
value $.001 per share.
  25
  Item
13. Certain Relationships and Related Transactions, and Director
Independence.
 
 Related
Party Transactions
 
 On June
10, 2006, the Company issued one share each to Nikolay Lobochev, Ivan Sorokoumov
and Dmitry Terikov, the founders of the Company for nominal stated
consideration.  Effective October 9, 2008, the Company amended its
articles of incorporation to increase the number of authorized common stock to
100,000,000 shares of common stock, par value $.001 per share; to authorize a
new class of preferred stock, par value $.001 per share; and to change each of
the three outstanding shares of common stock, par value $.10 per share, into
1,000,000 shares of common stock, par value $.001 per share.  On
October 9, 2008, the Company issued 500,000 shares of common stock to Alexander
Sorokoumov, the father of Ivan Sorokoumov, Chief Financial Officer, for
consulting services to be performed in the area of business growth and
development.
 
 
 Director
Independence
 
 All of
our directors are employees and would not be classified as “independent” under
the rules of the Securities and Exchange Commission.
 
  Item
14.  Principal Accountant Fees and Services
  (1)
      Aggregate fees for the last two years:2008
                                        2007----
                                        ----$23,671
                                        $10,000(2)
      Audit related fees:
                                        2008
                                        2007----
                                        ----$23,671
                                        $10,000(3)
      Tax fees:2008
                                        2007----
                                        ----$-0-
                                        $-0-
 (4) All
other fees: NA
 
 (5) Audit
committee pre-approval processes, percentages of services approved by audit
committee, percentage of hours spent on audit engagement by persons other than
principal accountant's full time employees: NA
  Item
15. Exhibits and Financial Statement Schedules.
   (a)(3)
Exhibits
  
 
 Exhibit
                  No.
                
                Description3.1*
                
                Articles
      of Incorporation, filed July 7, 20063.1a*
                
                Amendment
      to Articles of Incorporation, filed October 9, 20083.2*
                
                By-Laws10.1*
                
                Form
      of Customer Estimate.10.2*
                
                Lease
      Agreement dated September 1, 2008, between the Company and
      Marlon Industrial Park.
 
 *
Previously filed.
  
 31.1
                    Certification
      of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley
      Act of 2002, filed herewith.31.2
                    Certification
      of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley
      Act of 2002, filed herewith.32.1
                    Certification
      of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted
      Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, filed
      herewith.32.2
                    Certification
      of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted
      Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, filed
      herewith.
 26
 
 SIGNATURES
 
 In
accordance with Section 13 or 15(d) of the Exchange Act, the Company caused this
report to be signed on its behalf by the undersigned, thereunto duly authorized.
  ROYAL
      STYLE DESIGN, INC.Dated: 
      March 19, 2009By:
                                                          /s/ Nikolay
      LobachevNikolay
      Lobachev, President, ChiefExecutive
      Officer and DirectorBy:
                                                          /s/
      Ivan SorokoumovIvan
      SorokoumovChief
      Financial Officer
   Pursuant
to the requirements of the Securities Exchange Act of 1934, this report has been
signed below by the following person on behalf of the Registrant in the
capacities indicated, on  March 19, 2009.
 
 By:
                                /s/ Nikolay
      LobachevNikolay
      Lobachev, President, Chief Executive Officer and Director
 
 By:
                                  /s/ Ivan
      SorokoumovIvan
      Sorokoumov, Chief Financial Officer and Director
 
 By:
                                  /s/ Dmitry
      TerikovDmitry
      Terikov, Chief Operating Officer and Director
 
  27