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, 2009


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. 
000-53524





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
            32807(Address of
      principal executive offices)
            (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 whether the registrant has submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding
12 months (or for such shorter period that the registrant was required to submit
and post such files). Yes o   No 
o




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 31, 2010:
93,638,511





Documents
incorporated by reference:  None














TABLE OF
CONTENTS





PART
      I
            1Item
      1. Business.
            1Item
      1A. Risk Factors.
            5Item
      1B. Unresolved Staff Comments.
            8Item
      2. Properties.
            8Item
      3. Legal Proceedings.
            8Item
      4. Reserved.
            8PART
      II
            9Item
      5. Market for Registrant's Common Equity, Related Shareholder Matters and
      Issuer Purchases of Equity Securities.
            9Item
      6. Selected Financial Data.
            9Item
      7. Management's Discussion and Analysis of Financial Condition and Results
      of Operations.
            9Item
      7A. Quantitative and Qualitative Disclosures About Market
      Risk.
            14Item
      8. Financial Statements and Supplementary Data.
            15Item
      9. Changes In and Disagreements With Accountants on Accounting and
      Financial Disclosure.
            39Item
      9A (T). Controls and Procedures.
            39Item
      9B. Other Information.
            39PART
      III
            40Item
      10. Directors, Executive Officers, and Corporate
    Governance.
            40Item
      11. Executive Compensation.
            43Item
      12. Security Ownership of Certain Beneficial Owners and Management and
      Related Stockholder Matters.
            44Item
      13. Certain Relationships and Related Transactions, and Director
      Independence.
            44Item
      14.  Principal Accountant Fees and Services
            46Item
      15. Exhibits and Financial Statement Schedules.
            47SIGNATURES
            48










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 2010, 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”, “RSD” or the “Company”) was incorporated in the
State of Florida on July 7, 2006.  We specialized 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.





Effective
November 20, 2009, we entered into a Share Exchange Agreement with the
stockholders of Diversified Global Holdings, Inc., a Delaware corporation
(“DGH”), providing for the acquisition by the Company of 100% of the outstanding
shares of common stock of DGH.   In connection with this
Agreement, as of November 20, 2009, we issued 86,235,800 shares of our common
stock to the stockholders of DGH. The issuance of these 86,235,800 shares
effectively gave control of RSD to the DGH shareholders.  Our Board
saw this action as essential to the survival to the Company and as the best
course of action for our shareholders.  At a closing held on November
20, 2009, we acquired from the five stockholders of DGH 100% of the outstanding
shares of common stock of DGH, in exchange for our issuance of 86,235,800 shares
of our common stock.DGH is a holding company
that owns all of the outstanding shares or equity interests in three companies:
Forms Gallery, Inc., Delray Beach, Florida; Wood Imagination, Inc., Orlando,
Florida; and Kontakt LLC, with its principal offices located at Kazan, Russian
Federation.





Effective
December 31, 2009, we entered into three Exchange and Acquisition
Agreements  for the acquisition of three companies: Fregat Ltd., a
limited company formed under the laws of Russia, for the acquisition of which we
issued 203,698 shares of our common stock to the owner of all of its outstanding
ownership interests; Bauelemente Kuhn GmbH, a limited liability company formed
under the laws of Germany, for the acquisition of which we issued 63,233 shares
of our common stock to the owner of all of its outstanding ownership interests;
and Kuechen-Schilling GmbH, a limited liability company formed under the laws of
Germany, for the acquisition of which we issued 635,780 shares of our common
stock to the owner of all of its outstanding ownership interests.  In
connection with these agreements, as of December 31, 2009, we issued an
aggregate of 902,711 shares of our common stock to the owners of the three
companies we acquired.





Each of
the agreements entered into with the three DGH subsidiaries and the three
companies acquired on December 31, 2009, provides for rights in the former
owners to require us to initiate the regulatory filing process for clearance by
the SEC of the spin-off to our shareholders of the shares of our subsidiary
formerly owned by such owner, subject to our Board approval, and for the right
of each former owner to repurchase ownership of the subsidiary they sold to us
at any time in the first year following the closing date, by such former owner
paying to us the value of that subsidiary, as such value is determined by our
Board of Directors.





The
original businesses of RSD and each of our recently-acquired subsidiaries are
described separately below.





1




Our
Businesses





Overview





Our
rationale in November 2009 for the transfer of control of our company to the
shareholders of DGH in the acquisition of DGH and its three subsidiaries was
that our Board of Directors had concluded that the Company’s original
construction business was not enough to support our operations as a public
company. We transferred the operations of the Company to a more capable
management team, so that additional assets and operations would be brought into
the company and thereby increase shareholder value. The companies we have
acquired are for the purpose of consolidation of similar types of business
operations and efficiencies of scale.  We desire to share best
practice business strategies among companies in related industries within the
corporate group, as well as use supply chain efficiencies to create sustainable
cost effective competitive advantages.





Construction
and Retail—United States





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 founders, Nikolay Lobachev, our Chief Financial Officer,
Dmitry Terikov and Ivan Sorokoumov, had been working together as a team over the
prior seven years developing expertise and a broad experience in our
business.





RSD is a
custom tile and stone installation company that specializes in ceramic,
porcelain, marble, pavers and natural stone installation in existing structures
for ceilings, 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. RSD
currently has six employees, our President and CEO, our Chief Operating Officer,
our Chief Financial Officer and three installers.





Wood
Imagination, Inc. (“Wood Imagination”) was founded by Victor Belitchenko and
incorporated in the State of Florida on February 14, 2008.  Wood
Imagination, located in Orlando, Florida, specializes in custom made wood
furnishings, including cabinetmaking and millwork in custom design homes in
Central Florida.  Wood Imagination’s areas of expertise include
libraries, home theaters, entertainment centers, kitchens, flooring and doors.
It also does the exterior of homes along with trim boards and brackets. Wood
Imagination currently has one employee, its President and Chief Executive
Officer, and has three subcontractors working for it as its projects
require.





Our U.S. construction companies serve a diverse range of
residential clients and builders; most of our clients are builders. Both
companies have corporate websites. We rely primarily on referrals from satisfied
customers for new projects.




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 materials and supplies are readily available
from a large number of sources.





We experience competition from other woodwork,
installation and remodeling companies and individual
subcontractors.  While there is significant competition, we have
concentrated on providing better services to our clients.  Some of our
competitors are significantly larger than us. There are approximately 40
woodworking and millwork companies in the Orlando area, as well as other
installation and remodeling companies and individual subcontractors, a number of
which are larger than us.





Forms
Gallery, Inc. (“Forms Gallery”) was founded by Carole C. Lynn and incorporated
in the State of Florida on February 14, 1992.  Forms Gallery
specializes in the retail sales, consulting, placement and shipping of fine art.
Forms Gallery, located in Delray Beach, Florida, specializes in high-end, unique
contemporary works of art and jewelry.  The gallery displays oil,
acrylic and water color paintings, bronze, clay, glass and wood sculpture, wood
turnings and pottery.  The collections are from established artists
primarily from the West Coast and the southwestern states. Many of these artists
have their works in the Smithsonian Permanent Collection in Washington
D.C.   The Company has annual sales to a global customer base.
The customer base consists of commercial art and design selections for the
common areas of new multi-family high-rise condominium units as well as for
individual private art collectors.  Approximately fifty percent of the
sales are to local or regional customers and fifty percent are to visiting out
of state or out of country vacationing customers.  Forms Gallery
currently has four employees, its President and its Vice President and two part
time subcontractors.





Forms
Gallery experiences competition from other art galleries and individual
artists.  While there is significant competition, it has concentrated
on providing better services to its clients.  There are approximately
21 art galleries in the downtown Delray Beach area. However, the Company
believes that none provides a similar collection or works of art and jewelry
selection based on both quality and cost.




2





RSD and
Forms Gallery are subject to the State of Florida Workers Compensation laws and
carry workers compensation insurance.  RSD has a business license
issued by the City of Altamonte Springs, Florida; Forms Gallery has a business
license issued by the City of Delray Beach; and Wood Imagination has business
licenses issued by the City of Winter Garden and by Orange County,
Florida.





RSD carries 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.Forms Gallery and Wood Imagination carry similar
levels of business insurance.








Construction—Europe





Kuechen-Schilling
GmbH (“Kuechen-Schilling”) is a custom design and installation company
specializing in larger commercial applications and projects used for
businesses.  The company primarily does kitchen and bathroom design
but can do other interiors as well.  Kuechen-Schillingdesigns, builds and
installs commercial bathrooms and kitchens including all furniture. Similarly to
Baulemente Kuhn, the company offers a wide range of high quality, traditional
and contemporary kitchen components which are custom assembled to order. Full
bespoke design services are certain to satisfy every individual in connection
with a wide range of appliances. The company also sells the appliances that are
installed in their designs.





The
company was formed as a publicly registered firm in Germany in October
2008.  Kuechen-Schilling operates
primarily in Germany, with its principal office located in
Rodinghausen-Bruchmuhlen, Germany.  All revenue is earned within
Germany, and 100% of the company’s assets are located in Germany.
Kuechen-Schilling presently has seven employees and six
subcontractors.





Kuechen-Schillinghas a variety of customers
including large companies such as, Küchen-Klewno, Küchen-Frank,
Küchen-Zinn, Küchen-Degele, Küchen-Benhardt, Küchen-Neufeld and Kitchen
Manufacturer Arndt Lindemann. Private persons accounted for approximately 45% of
revenues and government agencies accounted for approximately 5% of
revenues.





Mr. Viktor Schilling, age 40, is currently the president
and founder of Kuechen-Schilling, Gmbh. His background is in the manufacturing business, where
he negotiated long term variable material contracts involving inventory controls
while maintaining safety, security and quality of product.





Bauelemente
Kuhn GmbH is a custom interior design company with a primary focus in home
kitchen and bathroom design and installation projects.  Its principal
offices are located in Lohne, Germany. It was incorporated as a publicly
registered firm in Germany in April, 2008.  Bauelemente Kuhn provides quality preconstruction consulting, design and
project management services.Bauelemente Kuhn’s main services are the
measurement and design, transportation & installation of home
interiors.  This includes kitchens and bathrooms, windows, interior
& exterior doors, blinds and garage doors. The company offers a wide range
of high quality, traditional and contemporary kitchen components which are
custom assembled to order.  Baulemente Kuhn operates primarily in
Germany, all revenue is earned within Germany and 100% of the company’s assets
are located in Germany.  Bauelemente Kuhn presently has four
employees.





Bauelemente Kuhn has a variety of customers including
large companies such as, F&S gmbh, Planungsburo Feist Gmbh and Werre Hause
Gmbh.Bauelemente Kuhn’s primary market is in the civilian
construction market. It uses the most advanced energy efficient products
available and applying a commercial construction standard which is a higher
standard than civilian construction standards.




3





Mr.
Valerian Kuhn, age 48, is presently the CEO of Bauelemente Kuhn. He has held
this position since 1997.  As their chief executive, he designed and
implemented a company strategy to provide economical solutions for residential
and commercial needs alike.  From 1990
through 1996 he was the president of Ardi Ltd. located in Omsk,
Russia.  As president he was responsible forfinancial
management, strategic planning, bank negotiations, wholesale distribution,
accounting systems development, productivity, profitability, team leadership,
inventory control and cost control.  He prepared and organized various
projects and information packages for clients and management.  He
received a bachelor’s degree in Mechanical Engineering from the University
of Avtodorozni located in Omsk, Russia.




The
building materials and supplies, kitchen products and electrical components
utilized by Kuechen-Schilling and Bauelemente Kuhn are readily available from a
large number of sources.





Most of
Kuechen-Schilling’s competition is from similarGerman companies.  Its primary advantage is its software that
allows it to go to the job site and provide all design services on site. It also
has a cultural advantage as all of its employees are bi-lingual, speaking both
German and Russian.  This enables it to access the Russian population
living in Germany, which is approximately 6% of the total population of
Germany.





All Kuechen-Schilling employees have general liability
insurance for workers compensation and employers liability with coverage of
$1,500,000 for each occurrence, $1,500,000 personal injury insurance, and
$2,000,000 in the aggregate, provided by AMB GENERALI.Bauelemente Kuhn
is a member of Holz-berufsgenossenschaft, which is a government agency that
provides workers compensation and unemployment insurance. Bauelemente Kuhn also
has additional insurance through the company HDI Gerling Lebensversicherung AG
which protects the CEO if he loses the ability to work.





Most of
Bauelemente Kuhn’s competition is with German companies.  A small
amount of competition comes from companies located in Poland and the Czech
Republic.





Bauelemente
Kuhn is registered with the German Federal government and also registered
locally with the city of Bad Oeynhausen.  Kuechen-Schilling is registered with the German
Federal government and is also registered with the city of Bad
Oeynhausen.






Technology—Europe





Kontakt
LLC (“Kontakt”) is a limited liability company organized under the laws of the
Russian Federation on October 3, 2005.  The company was founded by
Nikolay Uraev.  The company has legal right to do trading,
foreign-economic activity, manufacturing, research, construction and raw
material processing. The company’s main focus is resale of electronic components
(electrical connectors). Kontakt operates as a retailer of electronic components
to businesses that vary from nationwide companies to small businesses. Kontakt
currently has 8 employees.





Kontakt
commenced operations in November, 2005 in the Republic of Tatarstan, Russia. The
main operations of the company are the commercial retail of electronic
components in the region.  There are only two major electronic
connector manufacturers in Russia, “Elecon” in Kazan city and “Isetskiy” in
Kamenets-Uralskiy.  These two factories supply approximately 90% of
the domestic demand in the Russian Federation. Kontakt is the official
representative of both factories. Over the years Kontakt has created strong
business connections with defense and space exploration companies in the Russian
Federation. In 2008 its major customers accounted for 22.6%, 20.1%, and 12%,
respectively, of total sales.





Fregat Limited Liability Company (“Fregat”) is a
supplier of electronic components, electromechanical and automation
devices.  Fregat is a Russian Federation Corporation formed in
2006.  Fregat operates primarily in the Russian Federation and all
revenue is earned within the Russian Federation and 100% of the Company’s assets
are located in the Russian Federation.  Fregat has a variety of
customers including major companies such as, FNPC OAO "NPO Mars", Sosenskyi
Priborostroitel'nyi Zavod Aerotex OJSC, Prima LLC andTemp-Avia LLC.Fregat has 39 employees.





Fregat’s
founder and General Director is Sergey Vilchenkov, 37. He was employed at “The
Plant of precision instruments from Saransk" starting in 1997 until 2000. Prior
thereto, he served in the Russian Army Forces from 1995-1997(retiring as senior
lieutenant). Mr. Vilchenkov graduated from the Mordovian State university
N.P.Ogaryov (Saransk) in 1995 as an electronic equipment engineer.





Kontakt and Fregat experience some competition from
imports ofcheaper and lower quality Chinese products in the Russian
market, but due to quality issues these products have not captured significant
market share.




4





Kontakt
is subject to regulation in the Republic of Tatarstan, Russian Federation, as a
domestic limited liability company.  It has a State registration
number issued by the local government. Fregat is
subject to the Republic of Mordovia, Russian Federation about Limited Liability
companies.







Item 1A. Risk Factors.





Our
business is subject to numerous risk factors, including the
following:





Risks Applicable to Our
Construction Operations





THE
FUTURE SUCCESS OF OUR CONSTRUCTION AND RETAIL BUSINESSES DEPENDS ON OUR ABILITY
TO RESPOND TO CHANGING CONSUMER DEMANDS, IDENTIFY AND INTERPRET TRENDS IN THE
INDUSTRY AND SUCCESSFULLY MARKET NEW PRODUCTS.





The
construction and retail industries are subject to rapidly changing consumer
demands, technological improvements and industry standards. Accordingly, we must
identify and interpret trends and respond in a timely manner. Demand for and
market acceptance of new products are uncertain and achieving market acceptance
for new products generally requires substantial development and marketing
efforts and expenditures. If we do not continue to meet changing consumer
demands and develop successful product lines in the future, the Company’s growth
and profitability will be negatively impacted.   If we fail to
anticipate, identify or react appropriately to changes in construction and
retail product style, quality and trends or is not successful in marketing new
products, we could experience an inability to profitably sell our services and
products even at lower cost margins.   These risks could have a
severe negative effect on our results of operations or financial
condition.




THE LABOR
COSTS OF OUR FLORIDA REMODELING AND INSTALLATION COMPANIES MAY INCREASE WITH A
POTENTIAL SHORTAGE OF QUALIFIED PERSONNEL.




Labor
costs accounted for the majority of the operating expenses of RSD and Wood
Imagination. 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-RELATED BUSINESSES EXPOSES OUR FLORIDA REMODELING AND
INSTALLATION COMPANIES 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.





IN
FLORIDA AND GERMANY OUR CONSTRUCTION-RELATED BUSINESSES 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 construction-related services and products.
Our markets in Germany have also shown a decline, as a result of the weaker real
estate markets in that country.  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 in Florida and Germany 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.





5





Risks Applicable to Our
Technology Businesses





OUR
BUSINESS IS SUBJECT TO FLUCTUATIONS IN DEMAND IN THE RUSSIAN FEDERATION AND TO
CHANGING DOMESTIC ECONOMIC AND POLITICAL CONDITIONS WHICH ARE BEYOND OUR
CONTROL.





Operating
in the Russian Federation marketplace exposes us to a number of risks
including:





abrupt
changes in government policies and regulations,





trade
restrictions;





tax
increases; and





international
hostilities.





The lack
of a well-developed legal system in the Russian Federation may make it difficult
to enforce our contractual rights. To the extent that our business in the
Russian Federation is affected by unexpected and adverse economic and political
conditions, we may experience business disruptions and losses. Such disruptions
and losses could significantly reduce our revenues and profits.





RECENT
CONSTRAINTS ON THE AVAILABILITY OF CREDIT IN THE WORLDWIDE BANKING SYSTEM AND IN
THE RUSSIAN FEDERATION MAY AFFECT OUR RESULTS OF OPERATIONS.





Recent
constraints on the availability of credit in the worldwide banking system and in
the Russian Republic could adversely affect the viability of our customers and
have a consequent adverse effect on our results of operations. As a result, we
would face risks of:




·
            inability
      of our customers to finance their businesses, which
      would  reduce the demand for our
  products;


·
            currency
      fluctuations resulting from economic conditions in the Russian Federation;
      and


·
            economic
      instability in our markets in the Russian
  Federation.




WE DEPEND
PARTICULARLY ON THE SERVICES OF THE FOUNDERS AND CHIEF EXECUTIVE OFFICERS OF
KONTAKT AND FREGAT, AND IMPLEMENTATION OF OUR BUSINESS PLAN COULD BE SERIOUSLY
HARMED IF WE LOST EITHER OF THEIR SERVICES.





The
operations of Kontakt and Fregat in the Russian Federation depend heavily on the
services of Nikolay Uraev, Kontakt’s Chief Executive Officer and Sergey
Vilchenkov, Fregat’s General Director. We do not have an employment agreement
with, nor do we have a “key person” life insurance policy on, these executives
to cover our losses in the event of the death of either of them. There can be no
assurance that these executives will remain in their management positions with
us, and the loss of services of their executive would disrupt our business
operations in the Russian Federation, which could reduce our revenues and
profits.





KONTAKT
AND ITS SUPPLIERS WILL BE REQUIRED TO MODERNIZE THEIR PRODUCTION AND
DISTRIBUTION OPERATIONS.





Current
Russian factories’ equipment and technology are outdated, modernization costs
are high, and all these industries currently require modernization. Kontakt
management sees the necessity of restructuring the current electronic component
factories and modernizing this industry, to be able to supply specialized,
preassembled electronic components on a nationwide basis.  In
connection with the predicted modernization of the Russian industrial and
component factories, Kontakt and its suppliers will be required to modernize
their production and distribution systems.




Risks Applicable to Our
Businesses Generally





COMPETITION
COULD HARM OUR BUSINESSES.





The
markets for our businesses are becoming increasingly competitive. If we are
unable to either respond adequately to the competitive challenges we face or
establish a sustainable competitive advantage, we may lose market share or be
forced to lower prices to unprofitable levels.  In addition, we may be
unable to respond quickly or adequately to the changes in the marketplace
brought on by new service offerings and the marketing and promotional efforts of
existing or new competitors.





6




WE ARE
DEPENDENT ON INTERNATIONAL SALES, AND OUR BUSINESS IS SUBJECT TO THE LOCAL
BUSINESS RISKS IN EACH COUNTRY IN WHICH WE DO BUSINESS.





The
majority of the revenue from the sale of our location services will be derived
from customers located outside of the United States. Our sales and operations
outside of the United States could be subject to certain risks, including
difficulties in staffing and managing foreign subsidiary and branch operations,
currency exchange risks and exchange controls, potentially adverse tax
consequences and the possibility of difficulty in accounts receivable
collection. Any of these factors could adversely affect our business, financial
condition and results of operations. Our products and services may be subject to
foreign government standards and regulations that are continually being amended
and may vary from country to country. Our inability to render our products or
services in compliance with foreign standards could have a material adverse
effect on our business, financial condition and results of
operations.





WE DEPEND
ON THE SERVICES OF THE FOUNDERS AND EXECUTIVES OF OUR U.S. OPERATING COMPANIES
AND IMPLEMENTATION OF OUR BUSINESS PLAN COULD BE SERIOUSLY HARMED IF WE LOST THE
SERVICES OF ANY ONE OF THESE OFFICERS.





We depend
heavily on the services of Richard Lloyd, our Chief Executive Officer, as well
as the services of the executives that manage RSD, Forms Gallery, Wood
Imagination, Baulemente Kuhn and Schilling. We do not have an employment
agreement with, nor do we have a “key person” life insurance policy on, any of
these executives. There can be no assurance that these executives will remain in
their management positions with us, and the loss of services of any of these
executives would disrupt our business operations, which could reduce our
revenues and profits.




INTEGRATION
OF THE BUSINESS AND PRODUCT OFFERINGS OF ACQUIRED COMPANIES COULD DISRUPT OUR
BUSINESS OPERATIONS.





We have
made a few acquisitions in the recent year and anticipate that we may, from time
to time, acquire additional businesses, assets or securities of companies that
we believe would provide a strategic fit with our business. Any business we
acquire will need to be integrated with our existing operations. While we have
not had difficulty in the past effectively assimilating the business or product
offerings of companies we have acquired, there can be no assurance that we will
not have difficulties doing so in the future. In addition, we could incur
unknown or contingent liabilities of acquired companies. Difficulties in
integrating the operations and personnel of the acquired companies could disrupt
our business operations, divert management's time and attention and impair
relationships with and risk the possible loss of key employees and customers of
the acquired business. Our failure to adequately manage the integration of any
acquisition could disrupt our business operations and lower our revenues and
profits.




WE COULD
FACE LIMITATIONS ON OUR ABILITY TO ACCESS THE CAPITAL MARKETS.





Our
ability to access the capital markets is 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.





FLUCTUATIONS
IN THE VALUE OF FOREIGN CURRENCIES COULD RESULT IN CURRENCY EXCHANGE
LOSSES.





Our
products and services through our German and Russian Federation subsidiaries are
sold in currencies other than the U.S. Dollar, which makes the management of
currency fluctuations difficult and exposes us to risks. Fluctuations in the
value of foreign currencies relative to the U.S. Dollar could cause us to incur
currency exchange losses. The risk will increase to the extent international
revenue increases. The effect of exchange rate fluctuations on future operating
results cannot be predicted. We have no experience in entering into currency
hedging contracts, and if we use hedging to try to manage any future foreign
currency exposure, we may incur hedging-related losses.




WE DO NOT
PLAN TO PAY CASH DIVIDENDS.





Holders
of our common stock are entitled to cash dividends when, as and if declared by
the board of directors out of funds legally available for the payment of
dividends. Our management does not anticipate the declaration or payments of any
dividends in the foreseeable future. We intend to retain earnings, if any, to
finance the development and expansion of our business. Our future dividend
policy will be subject to the discretion of our board of directors and will be
contingent upon future earnings, if any, our financial condition, capital
requirements, general business conditions and other factors.





7




Item 1B. Unresolved Staff Comments.




Not
applicable.






Item 2. Properties.




On July
1, 2007, Royal Style Design 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 year-to-year lease.  Approximately
120 sq. ft. is used as office space while the remaining space is used as a
warehouse. Royal Style Design is purchasing three Toyota pickup trucks,
purchased in December 2006 and January 2007, and has outstanding loans for the
purchase of these trucks with an aggregate principal balance of $71,152 as of
December 31, 2008.





On July
1, 2002, Forms Gallery started leasing a 2475 sq. ft. store front property
located at 415 E. Atlantic Avenue, Delray Beach, Fl. 33431.  It was
leased monthly at a rent of $2200 per month. On November 30, 2009 Forms
Gallery terminated the lease agreement and a founder of the company contributed
the building to the company.  Forms
Gallery is currently in default on the mortgage for this
building. Forms
Gallery has no leases of property or equipment.





On May
30, 2009 Kontakt started leasing office/warehouse space for $2,100 per month in
Kazan, Russian Federation. The lease requires the Company to pay certain lease
operating costs (such as maintenance and insurance).  The lease
contains no escalation clauses or capital improvement funding provisions and
requires three months’ notice to cancel.  The lease is renewable
annually.





Fregat
leases 2,411 sq feet, which includes 1,689 sq feet in Moscow and 721 sq feet in
Saransk (office location). These leases require the Company to pay certain
executory costs (such as maintenance and insurance).  The leases
contain no escalation clauses or capital improvement funding
provisions.  The leases are renewed annually.





On
February 1, 2009 Bauelemente Kuhn started leasing a 2150 sq. ft.
office/warehouse space for $1,180 per month and located in Lohne, Germany. The
lease renews annually and requires the Company to pay certain lease operating
costs (such as maintenance and insurance).  The lease contains no
escalation clauses or capital improvement funding provisions and requires three
months’ notice to cancel.  The lease is renewable
annually.





On
September 1, 2009Kuechen-Schilling
started leasing 8,600 sq. ft.office and warehouse space for $10,442 per month and located in
Rodinghausen-Bruchmuhlen, Germany.Some of these
leases require the Company to pay certain executory costs (such as maintenance
and insurance).  These leases are with Mr. Viktor Schilling, a related
party.  The agreement between Mr. Viktor Schilling and the Company may
be terminated by either party with a six month notice from the end of any
quarter.  The leases contain no escalation clauses or capital
improvement funding provisions.  These leases are currently on a month
to month basis.







Item 3. Legal Proceedings.




None.






Item 4. Reserved.




8





PART
II




Item 5. Market for Registrant's Common Equity, Related Shareholder
Matters and Issuer Purchases of Equity Securities.




Our
shares of common stock are traded on OTC Bulletin Board market under the symbol
“RYSD.OB”. Our common stock commenced trading on the OTC Bulletin Board market
on September 4, 2009. The following table sets forth, for the periods indicated,
the high and low bid prices of our common stock, as reported in published
financial sources.   Quotations reflect inter-dealer prices, without
retail mark-up, mark-down, commission, and may not represent actual
transactions.








Fiscal
      Year Ended December 31, 2009
            High
            LowQuarter
      ended September 30, 2009 (September 4 through September
30)
            $5.00
            $.05Quarter
      ended December 31, 2009
            $5.05
            $4.51Fiscal
      Year Ended December 31, 2010Quarter
      ended March 31, 2010
            $7.05
            $6.00




As of
March 31, 2010, we had approximately 207 record holders of our common
stock.





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 31,2009
            2008Statement
      of operations data:Net
      Sales
            $1,217,560
            $1,668,830Net
      Earnings (Loss)
            (175,240)
            125,140Balance
      sheet data:Total
      assets
            3,751,067
            737,815Current
      Liabilities
            2,053,138
            516,494Long-term
      obligations
            27,563







Item 7. Management's Discussion and Analysis of Financial Condition
and Results 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
specialized 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.





Effective
November 20, 2009, we entered into a Share Exchange Agreement with the
stockholders of Diversified Global Holdings, Inc., a Delaware corporation
(“DGH”), providing for the acquisition by the Company of 100% of the outstanding
shares of common stock of DGH.   In connection with this
Agreement, as of November 20, 2009, we issued 86,235,800 shares of our common
stock to the stockholders of DGH. The issuance of these 86,235,800 shares
effectively gave control of RSD to the DGH shareholders.  DGH is a
holding company that owns all of the outstanding shares or equity interests in
three companies: Forms Gallery, Inc., Delray Beach, Florida; Wood Imagination,
Inc., Orlando, Florida; and Kontakt LLC, with its principal offices located at
Kazan, Russian Federation.




9





Effective
December 31, 2009, we entered into three Exchange and Acquisition
Agreements  for the acquisition of three companies: Fregat Ltd., a
limited company formed under the laws of Russia (“Fregat”),; Bauelemente Kuhn
GmbH, a limited liability company formed under the laws of Germany (“Kuhn”); and
Kuechen-Schilling GmbH, a limited liability company formed under the laws of
Germany (“Schilling”).  In connection with these agreements, as of
December 31, 2009, we issued an aggregate of 902,711 shares of our common stock
to the owners of the three companies we acquired.





For
accounting purposes only, the transaction with DGH was treated as a
recapitalization of Royal Style Design, as of November 20, 2009, with DGH as the
acquirer.  The financial statements prior to November 20, 2009 are
those of DGH and reflect the assets and liabilities of DGH at historical
carrying amounts. The financial statements show a retroactive restatement of
DGH's historical stockholders' equity to reflect the equivalent number of shares
issued to DGH. Our balance sheet at December 31, 2009, includes the assets and
liabilities of Fregat, Kuhn and Schilling, which were acquired on December 31,
2009. Our results of operations for the two years ended December 31, 2009
include no operations of Fregat, Kuhn and Schilling, as the results of their
operations will be included in operations from the date of their
acquisition.








YEARS
ENDED DECEMBER 31, 2009 AND DECEMBER 31, 2008





Revenues





Revenues
for the year ended December 31, 2009 were $1,217,560 as compared to $1,668,830
for the year ended December 31, 2008 representing a 27% decrease of
approximately $451,000.  The Company attributes the decrease primarily
to a downturn in the housing market that severely impacted revenue and decreases
in revenue in our European market due to the economic crisis in
2009.





Cost
of Sales





Cost of
sales decreased approximately $231,000 or 23% from $1,017,952 for the year ended
December 31, 2008 to $787,199 for the year ended December 31,
2009.  The Company attributes the decrease primarily to the decrease
in sales during 2009.





General
and Administrative Expenses





General
and administrative expenses increased approximately $93,000 or 18.9% from
$492,233 for the year ended December 31, 2008 as compared to $584,910 for the
year ended December 31, 2009.  The Company attributes the increase
primarily to a write-off of bad debts in the amount of $105,000, increase in
legal and accounting expenses involved with the filings with the Securities and
Exchange Commission offset, in part, by lower operating expenses due to the
economic crisis during 2009.





Net
Earnings (Loss)





For the
year ended December 31, 2009, the Company incurred a net loss of approximately
$175,000 as compared with net income of $125,000 for the year ended December 31,
2008.  The Company attributes the net loss in 2009 primarily to a
decrease in revenue due to economic crisis and an increase in general and
administrative expenses due to increased bad debts and higher professional fees
during the year.





Liquidity
and Capital Resources





As of
December 31, 2009, the Company has a working capital of $287,000 and
stockholders' equity of $1.7 million.  The Company finances its
activities presently through operations and related party loans.





A
subsidiary of the Company is presently in default of a mortgage secured by a
building owned by the subsidiary.  No interest or principal payments
have been made since May 2008.  The terms of the mortgage state if the
mortgage is not paid, the balance should be immediately due and payable and the
mortgage may be foreclosed.  As of December 31, 2008, the entire
amount of approximately $162,000 is due.  No demand by the lender for
payment or any foreclosure action has been taken.




10





Cash
increased approximately $301,000 during the year ended December 31,
2009.  The increase is primarily due to $128,000 acquired in
connection with the Company's 2009 acquisitions, net cash provided by operating
activities of $129,000 and proceeds from loans of approximately
$38,000.





Accounts
receivable, inventory, accounts payable, accrued expenses and customer advances
increased substantially as of December 31, 2009 as compared to December 31,
2008.  The Company primarily attributes these increases to amounts
received as part of the acquisition of Fregat, Kuhn, and Schilling on December
31, 2009.  The increases were negligible in the Company's existing
operations.





Property
and equipment increased approximately $1.2 million due primarily to the
contribution of a building in the amount of $1.0 million by a shareholder of the
Company.




Trend
Analysis by Industry Segment





Construction





Net sales
for the year ended December 31, 2009 were $273,539 as compared to $271,631 for
the year ended December 31, 2008 representing a 1% increase of approximately
$1,908.  The Company attributes the increase primarily to an upturn in
the U.S. housing and European markets towards the end of 2009.  The
Company expects revenues to increase for 2010.





Capital
expenditures decreased approximately $5,099 or 100% from $5,099 for the year
ended December 31, 2008 to $0 for the year ended December 31,
2009.  The Company attributes the decrease primarily to the decrease
in sales during 2009 and not wanting to purchase equipment during the economic
downturn.  The Company cannot predict capital expenditures for 2010;
however if the economy has an upswing investment in capital assets is likely as
sales increase.





Technology





Net sales
for the year ended December 31, 2009 were $745,796 as compared to $1,126,080 for
the year ended December 31, 2008 representing a 34% decrease of approximately
$380,284.  The Company attributes the decrease primarily to n downturn
in the economy during 2009 and a lack of capital spending by
customers.  The Company expects revenues to increase for
2010.





Capital
expenditures decreased approximately $90,856 or 100% from $90,856 for the year
ended December 31, 2008 to $0 for the year ended December 31,
2009.  The Company attributes the decrease primarily to the decrease
in sales during 2009 and not wanting to purchase equipment during the economic
downturn.  The Company cannot predict capital expenditures for 2010;
however if the economy has an upswing, investment in capital assets is likely as
sales increase.





Consulting





Net sales
for the year ended December 31, 2009 were $47,333 as compared to $80,000 for the
year ended December 31, 2008 representing a 41% increase of approximately
$32,667.  The Company attributes the decrease primarily to the fact
that most consulting work was obtained at the end of 2009 when the economy
started to rebound.  A large contract was signed in 2009, part of that
income was allocated to 2010.  The Company expects revenues to
increase for 2010.





Capital
expenditures decreased approximately $1,780 or 100% from $1,780 for the year
ended December 31, 2008 to $0 for the year ended December 31,
2009.  The Company attributes the decrease primarily to the decrease
in sales during 2009 and not purchasing equipment during the economic
downturn.  The Company will expects increased capital expenditures in
2010 due to the fact that the Company is currently in the process of developing
office space which will be used by the Company beginning May 2010.





Retail





Net sales
for the year ended December 31, 2009 were $150,892 as compared to $191,119 for
the year ended December 31, 2008 representing a 21% decrease of approximately
$40,227.  The Company attributes the decrease primarily to a downturn
in consumer spending due to the economic crisis of 2009.  Sales began
rebounding towards the end of 2009 and the Company expects revenues to increase
for 2010.





Capital
expenditures increased approximately $17,093 or 100% from $0 for the year ended
December 31, 2008 to $17,0930 for the year ended December 31,
2009.  The Company attributes the increase to the purchase of a
vehicle which will be used for in home consultations and
deliveries.  The Company hopes that the purchase of this asset will
further help drive sales.  The Company cannot predict capital
expenditures for 2010; however if the economy has an upswing investment in
capital assets is likely as sales increase.





11





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.







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 Report discusses 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.





Allowance for Doubtful
Accounts





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 accountsis
estimated based on the Company’s historical losses, the existing economic
conditions in the construction industry and in the electronic component resale
industry in Europe, and the financial ability of our customers.  The
Company believes that no allowance for doubtful accounts is necessary at
December 31, 2009 and 2008 for the U.S. construction subsidiaries. For other
subsidiaries, allowances for doubtful accounts have been provided. In the future
we will continue to evaluate provisions for allowances 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.





Business
Combinations





During
2009, the Company adopted the revised accounting guidance related to business
combinations. This guidance 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 literature.  In accordance
with this guidance, acquisition-related costs, including restructuring costs,
must be recognized separately from the acquisition and will generally be
expensed as incurred.  That replaces the cost-allocation process
detailed in previous accounting literature, which required the cost of an
acquisition to be allocated to the individual assets acquired and liabilities
assumed based on their estimated fair values.   The Company
implemented this new guidance effective January 1, 2009 and as a result, a total
of $10,000 in acquisition related costs were charged to selling, general and
administrative expenses during 2009.





Goodwill





Goodwill
is tested for impairment on an annual basis or whenever events or changes in
circumstances indicate that the carrying amount of an asset may not be
recoverable.  The Company tests goodwill for impairment, and has
established December 31 as the annual impairment test date, using a fair value
approach at the reporting unit level.  A reporting unit is an
operating segment or one level below an operating segment for which discrete
financial information is available and reviewed regularly by
management.  Assets and liabilities of the Company have been assigned
to the reporting units to the extent they are employed in or are considered a
liability related to the operations of the reporting unit and are considered in
determining the fair value of the reporting unit.  The Company has
determined that its reportable operating segments are its reporting
units.




12





The
goodwill impairment test is a two-step process.  If the fair value of
a reporting unit exceeds its carrying amount, goodwill of the reporting unit is
considered not impaired and the second step of the impairment test is
unnecessary.  If the carrying amount of a reporting unit exceeds its
fair value, the second step of the goodwill impairment test is performed to
measure the amount of impairment loss, if any.  The second step of the
goodwill impairment test compares implied fair value of the reporting unit’s
goodwill (i.e., fair value of the reporting unit less the fair value of the
unit’s assets and liabilities, including identifiable intangible assets) with
the carrying amount of that goodwill.  If the carrying value of
goodwill exceeds its implied fair value, the excess is required to be recorded
as an impairment.








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 ASC 360-15-35.  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.





Foreign Currency
Translation





The
functional currency for foreign operations is the local currency and the United
States dollar is the reporting currency.





Assets
and liabilities of foreign operations are translated at exchange rates as of the
balance sheet date, and income, expense and cash flow items are translated at
the average exchange rate for the applicable period.  Translation
adjustments are recorded in Other comprehensive income (loss).







New Financial Accounting
Standards





During
2009, the Company adopted the revised accounting guidance related to business
combinations.  This guidance 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 literature.  In accordance
with this guidance, acquisition-related costs, including restructuring costs,
must be recognized separately from the acquisition and will generally be
expensed as incurred.  That replaces the cost-allocation process
detailed in previous accounting literature, which required the cost of an
acquisition to be allocated to the individual assets acquired and liabilities
assumed based on their estimated fair values.  The Company implemented
this new guidance effective January 1, 2009.





During
2009, the Company implemented an update to the accounting guidance related to
earnings per share.  In accordance with this accounting guidance,
unvested share-based payment awards with rights to dividends are participating
securities and shall be included in the computation of basic earnings per
share.  The Company adopted this guidance effective January 1,
2009.  This implementation did not have a material impact on prior
periods presented.





The FASB
has published a update to the accounting guidance on fair value measurements and
disclosures as it relates to investments in certain entities that calculate net
asset value per share (or its equivalent).  This accounting guidance
permits a reporting entity to measure the fair value of certain investments on
the basis of the net asset value per share of the investment (or its
equivalent).  This update also requires new disclosures, by major
category of investments, about the attributes of investments included within the
scope of this amendment to the Codification.  The guidance in this
update is effective for interim and annual periods ending after December 15,
2009.  The Company does not expect the adoption of this standard to
have a material impact on the Company's results of operations, financial
condition or cash flows.




13




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.














14




Item 8. Financial Statements and Supplementary Data.















ROYAL
STYLE DESIGN, INC.


FINANCIAL
STATEMENTS


December
31, 2009 and 2008

















15






Index


PageReport
      of Independent Registered Public Accounting Firm
              17Report
      of Independent Registered Public Accounting Firm
              18Consolidated
      Balance Sheets as of December 31, 2009and
      2008
              19Consolidated
      Statements of Operations for the YearsEnded
      December 31, 2009 and 2008
              20Consolidated
      Statement of Stockholders' Equity for
      Eachof
      the Two Years in the Period Ended December 31, 2009
              21Consolidated
      Statements of Cash Flows for the YearsEnded
      December 31, 2009 and 2008
              22-23Notes
      to Consolidated Financial Statements
              24-38










16




Madsen & Associates, CPA's Inc.


684 East
Vine Street


Murray,
UT 84107











REPORT OF
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM





Board of
Directors


Royal
Style Design, Inc. and Subsidiaries


Orlando.
Florida





We have
audited the accompanying consolidated balance sheet of Royal Style Design, Inc.
and Subsidiaries (collectively, the “Company”) as of December 31, 2009, and the
related consolidated statements of operations, stockholders’ equity and cash
flows for the year ended.  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
audit.  The financial statements of Royal Style Design, Inc. and
Subsidiaries as of December 31, 2008, were audited by other auditors whose
report, dated December 14, 2009, expressed an unqualified opinion on those
statements.





We
conducted our audit 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 audit provides a reasonable basis
for our opinion.





In our
opinion, the 2009 financial statements present fairly, in all material respects,
the financial position of the Company as of December 31, 2009, and the results
of its operations and its cash flows for the year then ended, in conformity with
accounting principles generally accepted in the United States of
America.











/s/
Madsen & Associates, CPA's Inc.





April 2,
2010








17




REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM





Board of
Directors


Royal
Style Design, Inc.


Altamonte
Springs, FL  32701





We have
audited the accompanying consolidated balance sheet of Royal Style Design, Inc.
and Subsidiaries (collectively, the “Company”) as of December 31, 2008 and 2007,
and the related consolidated statements of operations, stockholders’ equity and
cash flows for the years ended December 31, 2008.  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 consolidated financial statements referred to above present fairly,
in all material respects, the financial position of the Company as of December
31, 2008, and the results of its operations and its cash flows for the year then
ended, in conformity with accounting principles generally accepted in the United
States of America.








/s/
Wiener, Goodman & Company, P.C.


Eatontown,
New Jersey








December
14, 2009









18




ROYAL STYLE DESIGN, INC. AND SUBSIDIARIESCONSOLIDATED
      BALANCE SHEETSDecember
      31,2009
            
            
            2008ASSETSCurrent
      Assets:Cash
      and cash equivalents
            
            $
            320,345
            
            
            $
            19,581Accounts
      receivable-net of allowance of $39,000 and $34,000,
      respectively
            
            
            1,172,253
            
            
            
            188,704Notes
      receivable - related parties
            
            
            53,573
            
            
            
            30,500Inventories
            
            
            645,410
            
            
            
            342,326Other
      current assets
            
            
            148,604
            
            
            
            41,019Total
      Current Assets
            
            
            2,340,185
            
            
            
            622,130Property
      and equipment-net
            
            
            1,273,922
            
            
            
            115,685Goodwill
            
            
            49,610
            
            
            
            -Other
      assets
            
            
            87,350
            
            
            
            -Total
      Assets
            
            $
            3,751,067
            
            
            $
            737,815LIABILITIES
      AND STOCKHOLDERS' EQUITYCurrent
      Liabilities:Current
      portion of long-term debt
            
            $
            211,245
            
            
            $
            -Accounts
      payable
            
            
            962,352
            
            
            
            450,608Accrued
      expenses
            
            
            220,782
            
            
            
            18,179Customer
      advances
            
            
            485,871
            
            
            
            37,871Due
      to related parties
            
            
            117,948
            
            
            
            5,125Deferred
      revenue
            
            
            52,667
            
            
            
            -Income
      taxes payable
            
            
            2,273
            
            
            
            4,711Total
      Current Liabilities
            
            
            2,053,138
            
            
            
            516,494Long-term
      Liabilities:Long-term
      debt-less current portion above
            
            
            27,563
            
            
            
            -Total
      Liabilities
            
            
            2,080,701
            
            
            
            516,494Commitments
      & Contingencies
            
            
            -
            
            
            
            -Stockholders'
      Equity:Common
      Stock, $.001 par value; authorized 100,000,000 shares:93,638,511and
      86,235,800 shares issued and outstanding atDecember
      31, 2009 and 2008, respectively
            
            
            93,637
            
            
            
            86,235Additional
      paid-in capital
            
            
            1,716,579
            
            
            
            (72,886
            )Retained
      earnings (deficit)
            
            
            (97,668
            )
            
            
            242,914Accumulated
      other comprehensive loss
            
            
            (42,182
            )
            
            
            (34,942
            )Total
      Stockholders' Equity
            
            
            1,670,366
            
            
            
            221,321Total
      Liabilities and Stockholders' Equity
            
            $
            3,751,067
            
            
            $
            737,815




See Notes
to Consolidated Financial Statements


19




ROYAL STYLE DESIGN, INC. AND SUBSIDIARIESCONSOLIDATED
      STATEMENTS OF OPERATIONSFor
      the years endedDecember
      31,2009
              
              
              2008Net
      sales:Revenue
              
              $
              1,217,560
              
              
              $
              1,668,830Cost
      and expenses:Cost
      of sales
              
              
              787,199
              
              
              
              1,017,952General
      and administrative
              
              
              584,910
              
              
              
              492,2331,372,109
              
              
              
              1,510,185(Loss)
      income from operations
              
              
              (154,549
              )
              
              
              158,645Other
      income (expense):Interest
      expense
              
              
              (2,345
              )
              
              
              (4,080
              )(Loss)
      earnings  beforeprovision
      for income taxes
              
              
              (156,894
              )
              
              
              154,565Provision
      for income taxes
              
              
              18,346
              
              
              
              29,425Net
      (loss) earnings
              
              $
              (175,240
              )
              
              $
              125,140(Loss)
      earnings  per common share-
      basic and diluted
              
              $
              (0.00
              )
              
              $
              0.00Weighted
      average number of commonshares
      outstanding - basic and diluted
              
              
              86,897,177
              
              
              
              86,235,800











20





ROYAL
      STYLE DESIGN, INC. AND SUBSIDIARIESCONSOLIDATED
      STATEMENT OF STOCKHOLDERS' EQUITYAdditional
              
              
              Retained
              
              
              AccumulatedCommon
      Stock
              
              
              Paid-in
              
              
              Earnings
              
              
              Other
      Comprehensive
              
              
              ComprehensiveShares
              
              
              Amount
              
              
              Capital
              
              
              (Deficit)
              
              
              Income (Loss)
              
              
              Income (Loss)
              
              
              TotalBalance,
      January 1, 2008
              
              
              86,235,800
              
              
              $
              86,235
              
              
              $
              (85,356
              )
              
              $
              117,774
              
              
              $
              7,479
              
              
              
              
              
              $
              126,132Assets
      contributed by shareholders
              
              
              
              
              
              
              
              
              
              
              10,870
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              10,870Foreign
      currency adjustment
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (42,421
              )
              
              
              (42,421
              )
              
              
              (42,421
              )Contribution
      from shareholders
              
              
              
              
              
              
              
              
              
              
              1,600
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              1,600Net
      earnings
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              125,140
              
              
              
              
              
              
              
              125,140
              
              
              
              125,140Comprehensive
      income
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              $
              82,719Balance,
      December 31, 2008
              
              
              86,235,800
              
              
              
              86,235
              
              
              
              (72,886
              )
              
              
              242,914
              
              
              
              (34,942
              )
              
              
              
              
              
              
              221,321Assets
      contributed by shareholders
              
              
              
              
              
              
              
              
              
              
              728,815
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              728,815Effect
      of reverse acquisition
              
              
              6,500,000
              
              
              
              6,500
              
              
              
              158,842
              
              
              
              (165,342
              )
              
              
              
              
              
              
              
              
              
              
              -Foreign
      currency adjustment
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (7,240
              )
              
              $
              (7,240
              )
              
              
              (7,240
              )Issuance
      of common stock for acquisitions
              
              
              902,711
              
              
              
              903
              
              
              
              901,808
              
              
              
              
              
              
              
              -
              
              
              
              -
              
              
              
              902,711Net
      (loss)
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (175,240
              )
              
              
              
              
              
              
              (175,240
              )
              
              
              (175,240
              )Comprehensive
      loss
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              $
              (182,480
              )Balance,
      December 31, 2009
              
              
              93,638,511
              
              
              $
              93,638
              
              
              $
              1,716,579
              
              
              $
              (97,668
              )
              
              $
              (42,182
              )
              
              
              
              
              
              $
              1,670,367








21




ROYAL STYLE DESIGN, INC. AND SUBSIDIARIESCONSOLIDATED
      STATEMENTS OF CASH FLOWSFor
      the Years Ended,December
      31,2009
            
            
            2008Cash
      flows from operating activities:Net
      (loss) earnings
            
            $
            (175,240
            )
            
            $
            125,140Adjustments
      to reconcile net cashprovided
      by operating activities:Depreciation
      and amortization
            
            
            15,349
            
            
            
            5,846Allowances
      for bad debts
            
            
            (7,499
            )
            
            
            31,543Changes
      in operating assets andLiabilities
            
            
            295,971
            
            
            
            (118,722
            )Net
      cash provided by operating activities
            
            
            128,581
            
            
            
            43,807Cash
      flows from investing activities:Cash
      from acquisitions
            
            
            128,109
            
            
            
            -Advances
      on note receivable
            
            
            -
            
            
            
            (30,500
            )Repayments
      on note receivable
            
            
            30,500
            
            
            
            -Purchase
      of property and equipment
            
            
            (17,093
            )
            
            
            (97,735
            )Net
      cash provided by (used in) investing activities
            
            
            141,516
            
            
            
            (128,235
            )Cash
      flows from financing activities:Contribution
      from shareholder
            
            
            -
            
            
            
            1,600Payments
      on debt
            
            
            (6,792
            )
            
            
            -Proceeds
      from loan
            
            
            12,859
            
            
            
            -Proceeds
      from advances from related party
            
            
            24,600
            
            
            
            5,125Net
      cash provided by financing activities
            
            
            30,667
            
            
            
            6,725Effect
      of exchange rate changes on cash
            
            
            -
            
            
            
            592Net
      increase (decrease) in cash and cash equivalents
            
            
            300,764
            
            
            
            (77,111
            )Cash
      and cash equivalents-beginning of year
            
            
            19,581
            
            
            
            96,692Cash
      and cash equivalents-end of year
            
            $
            320,345
            
            
            $
            19,581














22




ROYAL STYLE DESIGN, INC. AND SUBSIDIARIESCONSOLIDATED
      STATEMENTS OF CASH FLOWS(Continued)For
      the Years Ended,December
      31,Supplementary
      Information:
            
            2009
            
            
            2008Cash
      paid during the year for:Interest
            
            $
            2,345
            
            
            $
            4,080Income
      taxes
            
            $
            -
            
            
            $
            21,101Noncash
      contribution of assets by shareholder
            
            $
            728,815
            
            
            $
            10,870Changes
      in operating assets and liabilities consist of:(Increase)
      decrease in accounts receivable
            
            $
            86,095
            
            
            $
            (252,580
            )Decrease
      in inventory
            
            
            86,505
            
            
            
            64,961Increase
      in prepaid expenses
            
            
            (19,005
            )
            
            
            -Decrease
      in accounts payable and accrued expenses
            
            
            29,918
            
            
            
            115,727Increase
      in customer advances
            
            
            62,229
            
            
            
            (44,448
            )Increase
      in deferred revenue
            
            
            52,667
            
            
            
            -Increase
      (decrease) in income tax payable
            
            
            (2,438
            )
            
            
            (2,382
            )Net
      cash provided by operating activities
            
            $
            295,971
            
            
            $
            (118,722
            )Details
      of Acquisitions:Fair
      market value of assets acquired
            
            $
            1,949,807Liabilities
      assumed
            
            
            1,047,096Common
      stock issued
            
            $
            902,711















23




ROYAL
STYLE DESIGN, INC. AND SUBSIDIARIES


NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS


AS OF AND
FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008








1. DESCRIPTION
OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES





Organization





Royal
Style Design, Inc. (the “Company” or “Royal Style Design”) operates primarily in
four industries in two geographical areas - the United States and
Europe.  The Company is engaged in custom construction activities in
Germany and as a wholesale distributor of electronic components in Russia, and
is engaged in similar custom construction activities for the design and
installation of stonework and cabinet making and millwork in custom design homes
and in the retail sale of high-end contemporary works of art and jewelry in the
United States.  The U.S. operations also separately provide business
investment consulting services to small private companies.  Sales are
predominantly in the United States, Russia and Germany.





Basis of
Presentation





On
November 20, 2009, Royal Style Design entered into a Share Exchange Agreement
("Agreement") with the stockholders of Diversified Global Holdings, Inc. a
Delaware corporation, ("DGH"), providing for the acquisition by Royal Style
Design of 100% of all the outstanding shares of common stock of
DGH.  In connection with the agreement, as of November 20, 2009, Royal
Style Design issued 86,235,800 shares of its common stock to the stockholders of
DGH.  The issuance of these 86,235,800 shares effectively gave control
of Royal Style Design to the stockholders of DGH.





For
accounting purposes only, the transaction was treated as a recapitalization of
DGH, as of November 20, 2009, with DGH as the acquirer.  The financial
statements prior to November 20, 2009 are those of DGH and reflect the assets
and liabilities of DGH at historical carrying amounts. The financial statements
show a retroactive restatement of DGH's historical stockholders' equity to
reflect the equivalent number of shares issued to DGH.





On July
1, 2009, the Financial Accounting Standards Board ("FASB") established
Accounting Standards Codification ("ASC") as the primary source of authoritative
generally accepted accounting principles ("GAAP") recognized by the FASB to be
applied by nongovernmental entities.  Although the establishment of
the ASC did not change current GAAP, it did change the way we refer to GAAP
throughout this document to reflect the updated referencing
convention.





Significant Accounting
Policies





Principles of
Consolidation




The
consolidated financial statements include the accounts of the Company and its
wholly-owned subsidiaries, including businesses acquired since their respective
dates of acquisition.  All intercompany transactions and balances have
been eliminated.





Economic and Political
Risks




Two of
the Company's subsidiaries, Kontakt Limited Liability Company ("Kontakt") and
Fregat Limited Liability Company ("Fregat"), face a number of risks and
challenges since their operations are in the Russian Federation and its primary
market is in the Russian Federation.  100% of Kontakt's and Fregat's
revenue are earned in the Russian Federation and 100% of Kontakt's and Fregat's
assets are located in the Russian Federation.  Management cannot
presently predict what future impact the political risk will have on the
Company, if any, or how the political climate in the Russian Federation will
affect the Company’s operations.  Accordingly, events resulting from
any change in the political climate could have a material effect on the
Company.




24


ROYAL
STYLE DESIGN, INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008


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.  Estimates are used in
determining such items as costs to complete performance contracts, income tax
exposures, accruals, depreciable/useful lives, allowance for doubtful accounts
and valuation allowances.  Actual results could differ from those
estimates.





Revenue
Recognition





The
Company recognizes revenue in accordance with the ASC 605, "Revenue
Recognition".





Revenue
is recognized for the retail sale of contemporary works of art when title to the
merchandise passes to the purchaser.





Revenue
is recognized in custom construction activities such as the design and
installation of stonework and cabinet making and millwork in custom design homes
as each stage is completed, based on a percentage of the projected
costs.  There are no customer acceptance provisions in its sales
contracts.  The majority of the revenue has been received from
developers.





Revenue
from the sale of electronic components and other custom construction activities
is recognized when the product has been delivered and title and risk have passed
to the customer, collection of the resulting receivable is deemed reasonable
assured, and the sales price is fixed and determinable.  Substantially
all of the shipments are FCA (free carrier) which provide for title to pass upon
delivery to the customer's freight carrier.





Revenue
from consulting fees is recognized when earned.  Consulting fees
received in advance are amortized over the life of the
contract.  Unearned consulting fees are recorded as deferred revenues
on the Company's consolidated balance sheet.





Cash and Cash
Equivalents





Cash and
cash equivalents include cash deposited in checking accounts, overnight
repurchase agreements and money market funds with maturities of 90 days or less
when purchased.  The cash balances are held at a few institutions and
may, at times, exceed insurable amounts.  The Company believes it
mitigates this risk by depositing cash in major financial
institutions.





Accounts
Receivables





Accounts
receivables are recorded after title passes to the purchaser and are presented
in the balance sheet net of allowances for doubtful
accounts.  Accounts receivables are written off when they are
determined to be uncollectible.  The Company receives advances from
customers prior to the delivery of the products.  The Company records
these advance payments as Customer Advances on the Company’s consolidated
balance sheet.  Customer advances as of December 31, 2009 and 2008
were $485,871 and $37,871, respectively.  The allowance for doubtful
accounts is estimated based on the Company's historical losses, the existing
economic condition in the industry, and the financial ability of its
customers.  For the years ended December 31, 2009 and 2008 the Company
established a reserve for doubtful accounts of $39,000 and $34,000,
respectively.




25


ROYAL
STYLE DESIGN, INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008




During
the years ended December 31, 2009 and 2008 the Company wrote off receivables in
the amount of $21,270 and $151,453, respectively, which is included in the
general and administrative expenses in the Consolidated Statement of
Operations.





Inventories





Inventories
are stated at the lower of cost or market.  The Company also receives
goods on consignment and payment is made to the consignor when title to the
merchandise passes to the purchaser.




Depreciation





Property
and equipment is carried at cost. Depreciation is computed using the
straight-line method over the estimated useful lives of the assets.




DepreciableAsset
                
                LivesVehicles
                
                3
      yearsMachinery
      and equipment
                
                5 -
      7 yearsSigns
                
                5
      yearsBuilding
      and improvements
                
                30
      years







Income
Taxes





The
Company accounts for income taxes under the asset and liability method, which
requires the recognition of deferred tax assets and liabilities for the expected
future tax consequences of events that have been included in the financial
statements.  Under this method, deferred tax assets and liabilities
are determined based on the differences between the financial statements and tax
basis of assets and liabilities using enacted tax rates in effect for the year
in which the differences are expected to reverse.  The effect of a
change in tax rates on deferred tax assets and liabilities is recognized in
income in the period that includes the enactment date.





The
Company records net deferred tax assets to the extent they believe these assets
will more-likely-than-not be realized.  In making such determination,
the Company considers all available positive and negative evidence, including
future reversals of existing taxable temporary differences, projected future
taxable income, tax planning strategies and recent financial
operations.  In the event the Company was to determine that it would
be able to realize its deferred income tax assets in the future in excess of its
net recorded amount, the Company would make an adjustment to the valuation
allowance which would reduce the provision for income taxes.





The
Company accounts for income taxes in accordance with the Internal Revenue Code
in the United States, the Internal Income Tax Law of the Russian Federation and
the Income Tax Law of the Republic of Germany. The Russian Federation
subsidiaries are taxed at a rate of 24% and the Republic of Germany subsidiaries
are taxed at a rate of 15%.





Business
Combinations





During
2009, the Company adopted the revised accounting guidance related to business
combinations. This guidance 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 literature.  In accordance
with this guidance, acquisition-related costs, including restructuring costs,
must be recognized separately from the acquisition and will generally be
expensed as incurred.  That replaces the cost-allocation process
detailed in previous accounting literature, which required the cost of an
acquisition to be allocated to the individual assets acquired and liabilities
assumed based on their estimated fair values.   The Company
implemented this new guidance effective January 1, 2009 and as a result, a total
of $10,000 in acquisition related costs were charged to selling, general and
administrative expenses during 2009.




26




ROYAL
STYLE DESIGN, INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008


Goodwill





Goodwill
is tested for impairment on an annual basis or whenever events or changes in
circumstances indicate that the carrying amount of an asset may not be
recoverable.  The Company tests goodwill for impairment, and has
established December 31 as the annual impairment test date, using a fair value
approach at the reporting unit level.  A reporting unit is an
operating segment or one level below an operating segment for which discrete
financial information is available and reviewed regularly by
management.  Assets and liabilities of the Company have been assigned
to the reporting units to the extent they are employed in or are considered a
liability related to the operations of the reporting unit and are considered in
determining the fair value of the reporting unit.  The Company has
determined that its reportable operating segments are its reporting
units.





The
goodwill impairment test is a two-step process.  If the fair value of
a reporting unit exceeds its carrying amount, goodwill of the reporting unit is
considered not impaired and the second step of the impairment test is
unnecessary.  If the carrying amount of a reporting unit exceeds its
fair value, the second step of the goodwill impairment test is performed to
measure the amount of impairment loss, if any.  The second step of the
goodwill impairment test compares implied fair value of the reporting unit’s
goodwill (i.e., fair value of the reporting unit less the fair value of the
unit’s assets and liabilities, including identifiable intangible assets) with
the carrying amount of that goodwill.  If the carrying value of
goodwill exceeds its implied fair value, the excess is required to be recorded
as an impairment.








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 ASC 360-15-35.  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, accounts receivable and notes
receivable.




The
Company's cash and cash equivalents are concentrated primarily in one bank in
the United States and various banks in Germany and Russia.  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.





The
Company is also subject to the risk of currency fluctuations that may affect the
prices paid for goods and the amounts received for revenue.




27


ROYAL
STYLE DESIGN, INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008


Earnings Per
Share





Basic
earnings per share are computed by dividing net earnings by the weighted average
number of common shares outstanding during the specified period. Diluted
earnings per common share is computed by dividing net income by the weighted
average number of common shares and potential common shares during the specified
period. For the years ended December 31, 2009 and 2008, there were no potential
shares outstanding.







Fair
Value of Financial Instruments





The
Company adopted ASC 820, "Fair Value Measurements and Disclosures" on
January 1, 2008, for all financial assets and liabilities that are
recognized or disclosed at fair value in the condensed consolidated financial
statements on a recurring basis or on a nonrecurring basis during the reporting
period. While the Company adopted the provisions of ASC 820 for nonfinancial
assets and liabilities that are recognized or disclosed at fair value in the
financial statements on a recurring basis, no such assets or liabilities existed
at the balance sheet date. As permitted by ASC 820, the Company delayed
implementation of this standard for all nonfinancial assets and liabilities
recognized or disclosed at fair value in the financial statements on a
nonrecurring basis and adopted these provisions effective January 1,
2009.




The fair
value is an exit price, representing the price that would be received to sell an
asset or paid to transfer a liability in an orderly transaction between market
participants at the measurement date.  The Company utilizes market
data or assumptions that market participants would use in pricing the asset or
liability.  ASC 820 establishes a three-tier fair value hierarchy,
which prioritizes the inputs used in measuring fair value.  These
tiers include:  Level 1, defined as observable inputs such as quoted
market prices in active markets; Level 2, defined as inputs other than quoted
prices in active markets that are either directly or indirectly observable; and
Level 3, defined as unobservable inputs about which little or no market data
exists, therefore requiring an entity to develop its own
assumptions.




As of
December 31, 2009, the Company held certain financial assets that are measured
at fair value on a recurring basis.  These consisted of cash and cash
equivalents.  The fair values of the cash and cash equivalents is
determined based on quoted market prices in public markets and is categorized as
Level 1.   The Company does not have any financial assets
measured at fair value on a recurring basis as Level 2 or Level 3 and there were
no transfers in or out of Level 2 or Level 3 during the year ended December 31,
2009.




The
following table sets forth by level, within the fair value hierarchy, the
Company’s financial assets accounted for at fair value on a recurring basis as
of December 31, 2009 and 2008.








28





ROYAL
STYLE DESIGN, INC. AND SUBSIDIARIES


NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS


AS OF AND
FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008




Assets
      at Fair Value as of December 31, 2009 and 2008 UsingDecember
      31, 2009
              
              Total
              
              
              Quoted
      Prices in Active
                Markets
      for Identical
                Assets (Level
      1)
              
              
              Significant
      Other
                Observable
                Inputs (Level
      2)
              
              
              Significant
                Unobservable
                Inputs (Level
      3)Cash
      and cash equivalents
              
              $
              320,345
              
              
              $
              320,345
              
              
              $
              -
              
              
              $
              -December
      31, 2008
              
              Total
              
              
              Quoted
      Prices in Active
                Markets
      for Identical
                Assets (Level
      1)
              
              
              Significant
      Other
                Observable
                Inputs (Level
      2)
              
              
              Significant
                Unobservable
                Inputs (Level
      3)Cash
      and cash equivalents
              
              $
              19,581
              
              
              $
              19,581
              
              
              $
              -
              
              
              $
              -


The
Company has other financial instruments, such as receivables, accounts payable
and other liabilities which have been excluded from the tables
above.  Due to the short-term nature of these instruments, the
carrying value of receivables, accounts payable and other liabilities
approximate their fair values.  The Company did not have any other
financial liabilities with the scope of the fair value disclosure requirements
as of December 31, 2009.




Non-financial
assets and liabilities, such as goodwill and long-lived assets, are accounted
for at fair value on a nonrecurring basis.  These items are tested for
impairment upon the occurrence of a triggering event or in the case of goodwill,
on at least an annual basis.  As of December 31, 2009, there was no
impairment to goodwill.  The Company's interim test on its long-lived
assets indicated that the carrying value of its long-lived assets was
recoverable and that no impairment existed as of the testing date.




Foreign Currency
Translation





The
functional currency for foreign operations is the local currency and the United
States dollar is the reporting currency.





Assets
and liabilities of foreign operations are translated at exchange rates as of the
balance sheet date, and income, expense and cash flow items are translated at
the average exchange rate for the applicable period.  Translation
adjustments are recorded in Other comprehensive income (loss).








New Financial Accounting
Standards





During
2009, the Company adopted the revised accounting guidance related to business
combinations.  This guidance 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 literature.  In accordance
with this guidance, acquisition-related costs, including restructuring costs,
must be recognized separately from the acquisition and will generally be
expensed as incurred.  That replaces the cost-allocation process
detailed in previous accounting literature, which required the cost of an
acquisition to be allocated to the individual assets acquired and liabilities
assumed based on their estimated fair values.  The Company implemented
this new guidance effective January 1, 2009.




29


ROYAL
STYLE DESIGN, INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008


During
2009, the Company implemented an update to the accounting guidance related to
earnings per share.  In accordance with this accounting guidance,
unvested share-based payment awards with rights to dividends are participating
securities and shall be included in the computation of basic earnings per
share.  The Company adopted this guidance effective January 1,
2009.  This implementation did not have a material impact on prior
periods presented.





The FASB
has published a update to the accounting guidance on fair value measurements and
disclosures as it relates to investments in certain entities that calculate net
asset value per share (or its equivalent).  This accounting guidance
permits a reporting entity to measure the fair value of certain investments on
the basis of the net asset value per share of the investment (or its
equivalent).  This update also requires new disclosures, by major
category of investments, about the attributes of investments included within the
scope of this amendment to the Codification.  The guidance in this
update is effective for interim and annual periods ending after December 15,
2009.  The Company does not expect the adoption of this standard to
have a material impact on the Company's results of operations, financial
condition or cash flows.







2. ACQUISITIONS





Effective
December 31, 2009, the Company entered into three Exchange and Acquisition
Agreements (the “Agreements”) for the acquisition of three companies: Fregat
Ltd., a limited company formed under the laws of Russia (“Fregat”), for the
acquisition of which the Company issued 203,698 shares of its common stock to
the owner of all of the outstanding ownership interests in Fregat; Bauelemente
Kuhn GmbH, a limited liability company formed under the laws of Germany
(“Kuhn”), for the acquisition of which the Company issued 63,233 shares of its
common stock to the owner of all of the outstanding ownership interests in Kuhn;
and Kuechen Schilling GmbH, a limited liability company formed under the laws of
Germany (“Schilling”), for the acquisition of which the Company issued 635,780
shares of its common stock to the owner of all of the outstanding ownership
interests in Schilling.  In connection with the Agreements, as of
December 31, 2009, the Company issued an aggregate of 902,711 shares of its
common stock to the owners of the three companies the Company
acquired.





Each of
the agreements entered into with the three companies acquired on December 31,
2009, provides the former owners to require the Company to initiate the
regulatory filing process for clearance by the Securities and Exchange
Commission to register the shares received by the former owners, subject to the
Company's Board approval, and for the right of each former owner to repurchase
ownership of the subsidiary they sold to the Company at any time in the first
year following the closing date, by such former owner paying the Company the
value of that subsidiary, as such value is determined by the Company's Board of
Directors.





The
aggregate purchase price was $902,711, the fair value of the common stock
issued.  The results of operations of the three companies acquired
will be included in the consolidated financial statements beginning January 1,
2010.  The following table presents the preliminary allocation of the
purchase price to the assets acquired and liabilities assumed, based on their
fair values.





30




ROYAL
STYLE DESIGN, INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008


At December 31,
2009




Purchase
      price:Common
      stock issued
                
                $
                902,711Total
      consideration
                
                
                
                
                
                $
                902,711Allocation
      of purchase price:Cash
                
                
                
                
                
                
                121,592Accounts
      receivable
                
                
                
                
                
                
                1,043,268Notes
      receivable - related parties
                
                
                
                
                
                
                53,573Inventories
                
                
                
                
                
                
                389,589Other
      current assets
                
                
                
                
                
                
                84,733Property,
      plant and equipment
                
                
                
                
                
                
                120,517Other
      assets
                
                
                
                
                
                
                86,925Goodwill
                
                
                
                
                
                
                49,610Total
      Assets Acquired
                
                
                
                
                
                
                1,949,807Current
      portion of long-term debt
                
                
                
                
                
                
                25,234Accounts
      payable
                
                
                
                
                
                
                500,358Accrued
      expenses
                
                
                
                
                
                
                135,733Customer
      advances
                
                
                
                
                
                
                385,771Total
      Liabilities Assumed
                
                
                
                
                
                
                1,047,096Net
      Assets Acquired
                
                
                
                
                
                $
                902,711







The
acquisitions have been accounted for using the purchase method of accounting,
and accordingly, the results of operations of Fregat, Kuhn and Schilling will be
included in the Company's consolidated financial statements from January 1,
2010.





The
following unaudited pro forma summary of results of operations assume Fregat,
Kuhn and Schilling had been acquired as of January 1, 2008:







Years
      EndedDecember
      31,2009
              
              
              2008Net
      revenue
              
              $
              5,816,992
              
              
              $
              6,778,469Net
      earnings (loss)
              
              
              (146,566
              )
              
              
              107,015Earnings
      (loss) per share - diluted
              
              
              (0.00
              )
              
              
              0.00


The
information above is not necessarily indicative of the results of operations if
the acquisition had been consummated as of January 1, 2008.  Such
information should not be construed as a representation of the future results of
operations of the Company.








3. GOODWILL
AND OTHER INTANGIBLE ASSETS





Goodwill
represents the excess of the purchase price over the value assigned to the net
intangible and other intangible assets with finite lives acquired in a business
acquisition.  Effective January 1, 2009, acquisition related costs
will be recognized separately from the acquisition in accordance with ASC 805,
"Business Combinations".




31


ROYAL
STYLE DESIGN, INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008


The
changes in the carrying value of goodwill for the year ended December 31, 2009
is as follows:




TotalBalance,
      December 31, 2008
              
              $
              -Acquired
      during the year endedDecember
      31, 2009
              
              
              49,610Balance,
      December 31, 2009
              
              $
              49,610




Nonfinancial
assets and liabilities, such as goodwill and long-lived assets, are accounted
for at fair value on a non recurring basis.  These items are tested
for impairment upon the occurrence of a triggering event or in the case of
goodwill, on at least an annual basis.







4. PROPERTY
and EQUIPMENT





Property,
plant and equipment consist of furniture and equipment used in the ordinary
course of business and are recorded at cost less accumulated
depreciation.





December
      31,2009
              
              
              2008Machinery
      & equipment
              
              $
              48,430
              
              
              $
              16,980Vehicles
              
              
              147,052
              
              
              
              8,051Buildings
      and building improvements
              
              
              1,113,268
              
              
              
              110,1311,308,750
              
              
              
              135,162Less:
      accumulated depreciation
              
              
              34,828
              
              
              
              19,477$
              1,273,922
              
              
              $
              115,685


In
November 2009, a shareholder of the Company contributed a building to the
Company with a fair value of approximately $1 million in accordance with an
appraisal performed by an independent third party, and related debt of
approximately $271,000.





Depreciation
expense for the years ended December 31, 2009 and 2008 was $15,349 and $5,846,
respectively.




5.           
 NOTES RECEIVABLE
- RELATED
PARTIES




A)
            In
      October 2008, the Company advanced Alfa Investment Fund, a company owned
      by a major shareholder of the Company, $30,500.  The advance is
      interest free.  The advance was repaid in full in
      2009.







B)
            In
      connection with the acquisition of Kuhn, the Company has a receivable from
      a shareholder as of December 31, 2009 in the amount of
      $53,573.  The note bears interest at 5% per anum and is due upon
      demand.






32




ROYAL
STYLE DESIGN, INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008




6. INVENTORIES








As of
December 31, 2009 and 2008, inventory consists of the following:




December
      31,2009
              
              
              2008Finished
      goods
              
              $
              394,272
              
              
              $
              112,176Work
      in progress
              
              
              148,815
              
              
              
              -Raw
      materials
              
              
              3,070
              
              
              
              -Advance
      deposits
              
              
              99,253
              
              
              
              230,150$
              645,410
              
              
              $
              342,326









The
Company prepays various suppliers for inventory.  The deposits paid in
advance are included as a component of the Company's inventory.






7. DEBT
   Long-term
debt consists of the following:




December
      31,2009
              
              
              2008Mortgage
      payable, interest at 10%, monthly payment
              
              $
              162,217
              
              
              $
              -of
      $2,200, due June 2011, collaterizedby
      a building and the personal guaranteeof
      a shareholder (1)Automobile
      loans, interest at 0 - 5.9%, monthly payments
              
              
              51,356
              
              
              
              -of
      $2,028, due December 2010 through December 2013Automobile
      loan, interest at 14%, monthly payment
              
              
              13,590
              
              
              
              -of
      $1,224 due November 2010Automobile
      loan, interest at 5%, monthly payment
              
              
              4,689
              
              
              
              -of
      $469 due October 2010Loan
      payable, interest free, due upon demand
              
              
              6,956
              
              
              
              -238,808
              
              
              
              -Less
      current portion
              
              
              211,245
              
              
              
              -$
              27,563
              
              
              $
              -
 
 33




ROYAL
STYLE DESIGN, INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008




The
following table shows the maturities by year of the total amount of long-term
debt as of December 31, 2009:




Year
      Ending December 31,2010
              
              
              211,2452011
              
              
              21,8102012
              
              
              3,2852013
              
              
              2,468$
              238,808




(1) The
mortgage is currently in default.  No payments of principal or
interest have been made since May 2008.  The terms of the mortgage
state if the mortgage is not paid, the balance shall be immediately due and
payable and the mortgage may be foreclosed.  As of the date of this
report, no demand by the lender for payment or any foreclosure action has been
taken.







8. ACCRUED
EXPENSES







December
      31,2009
              
              
              2008Professional
      fees
              
              $
              58,659
              
              
              $
              -Salaries
              
              
              36,166
              
              
              
              -Taxes
      payable
              
              
              62,197
              
              
              
              -Warranty
              
              
              18,434
              
              
              
              -Other
              
              
              45,326
              
              
              
              18,179$
              220,782
              
              
              $
              18,179




9.         
   COMMON STOCK





The
Company is authorized to issue 100,000,000 shares of $.001 par value common
stock of which 93,638,511 shares are outstanding as of December 31,
2009.





10.           INCOME
TAXES





The
Company adopted the provisions of FASB ASC 740, "Income Taxes", ("ASC 740") on
January 1, 2008.  As a result of the implementation of ASC 740, the
Company recognized no adjustment in the net liabilities or equity for
unrecognized income tax benefits.  The Company believes there are no
potential uncertain tax positions and all tax returns are correct as
filed.  Should the Company recognize a liability for uncertain tax
positions, the Company will separately recognize the liability for uncertain tax
positions on its balance sheet.  Included in any liability for
uncertain tax positions, the Company will setup a liability for interest and
penalties.  The Company policy is to recognize interest and penalties
related to uncertain tax positions as a component at the current provision for
income taxes.




34





ROYAL
STYLE DESIGN, INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008





The
provision for income taxes consists of the following:





For
      the Years EndedDecember
      31,2009
              
              
              2008Current:Federal:
              
              $
              -
              
              
              $
              4,711Foreign:
              
              
              18,346
              
              
              
              24,71418,346
              
              
              
              29,425Deferred:Federal:
              
              
              -
              
              
              
              -Foreign:
              
              
              -
              
              
              
              --
              
              
              
              -$
              18,346
              
              
              $
              29,425


A reconciliation of taxes on income
computed at the federal stated rate to amounts provided:





For
      the Years EndedDecember
      31,2009
              
              
              2008Tax
      computed at the federal statedrate
      of 34%:
              
              $
              (53,343
              )
              
              $
              52,552Increase
      (decease) in taxes resulting from:Different
      tax rates and permanentdifferences:
              
              
              18,346
              
              
              
              (23,127
              )Unused
      net operating losses
              
              
              53,343
              
              
              
              -$
              18,346
              
              
              $
              29,425


The
Company files income tax returns in all jurisdictions in which it has reason to
believe it is subject to tax.  The Company is subject to examination
by various taxing jurisdictions.  To date, none of these examinations
has resulted in any material additional tax.  Nonetheless, any tax
jurisdiction may contend that a filing position claimed by the Company regarding
one or more of its transactions is contrary to that jurisdictions laws or
regulations.  Significant judgment is required in determining the
worldwide provisions for income taxes.  In the ordinary course of
business of a global business, the ultimate tax outcome is uncertain for many
transactions.  It is the Company’s policy to establish provisions for
taxes that may become payable in future years as a result of an examination by
tax authorities.  The Company establishes the provisions based upon
management’s assessment of exposure associated with permanent tax differences
and tax credits applied to temporary difference adjustments.  The tax
provisions are analyzed periodically (at least quarterly) and adjustments are
made as events occur that warrant adjustments to those provisions.





35


ROYAL
STYLE DESIGN, INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008


Components
of deferred income tax assets are as follows:





December
      31,2009
              
              
              2008Tax EffectDeferred
      Tax Asset - CurrentForeign
      net operating loss carryforward
              
              $
              31,000
              
              
              $
              -U.S.
      net operating loss carryforward
              
              
              82,000
              
              
              
              58,000Valuation
      allowance
              
              
              (113,000
              )
              
              
              (58,000
              )$
              -
              
              
              $
              -


As of
December 31, 2009, the Company recorded a deferred tax asset with a foreign net
operating loss ("NOL") carryforward of approximately $205,000 and U.S. net
operating loss carryforward of approximately $240,000 that was fully offset by a
valuation allowance due to the determination that it was more than likely that
the Company would be unable to utilize those benefits in the foreseeable
future.  The Company's foreign NOL expires in 2015 and the U.S. NOL
expires in 2025.





Section
382 of the U.S. Internal Revenue Code imposes an annual limitation on the
availability of NOL carryforwards to offset taxable income when an ownership
change occurs.  The Company's reverse recapitalization meets the
definition of an ownership change and some of the NOL's will be
limited.








11.           RELATED
PARTY TRANSACTIONS





a)
            A
      stockholder of the Company advanced the Company $5,125 during the year
      ended December 31, 2008 and $24,600 during the year ended December 31,
      2009.  The advance is interest free and due on
      demand.  No payments have been made against the advance and the
      amount due the related party is $29,725 and $5,125 at December 31, 2009
      and 2008, respectively.





b)
            In
      connection with the contribution of a building to the Company by a
      shareholder, the Company is obligated to reimburse the shareholder for
      payments made by the shareholder in connection with the
      building.  The note to the shareholder bears interest of 5% per
      anum and is due upon demand.  As of December 31, 2009, the
      amount due the shareholder was
$88,223.




c)
              On
      May 1, 2009, a subsidiary of the Company entered into an investment
      consulting agreement with Alpha Limited, a company owned by a major
      shareholder of the Company.  The subsidiary paid Alpha Limited
      $50,000 in consulting fees during the year ended December 31,
      2009.





12.           BUSINESS
SEGMENT INFORMATION





FASB ASC
280-10-10 "Segment Reporting" ("ASC 280-10-10"), established standards for
reporting information about operating segments.  Operating segments
are defined as components of an enterprise about which separate financial
information is available that is evaluated regularly by
management.  The Company is organized by geographical area and
industry segment.








36


ROYAL
STYLE DESIGN, INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008




The
following financial information relating to the Company's business
segments:





2009
              
              
              2008Net
      sales by geographic areas:United
      States
              
              $
              471,764
              
              
              $
              542,750Europe
              
              
              745,796
              
              
              
              1,126,080$
              1,217,560
              
              
              $
              1,668,830Net
      sales by industry segment:Electronic
      components
              
              $
              745,796
              
              
              $
              1,126,080Art
      work and jewelry
              
              
              150,892
              
              
              
              191,119Construction
              
              
              273,539
              
              
              
              271,631Other
              
              
              47,333
              
              
              
              80,000$
              1,217,560
              
              
              $
              1,668,830


2009
              
              
              2008(Loss)
      income from operations:Electronic
      components
              
              $
              (106,811
              )
              
              $
              148,423Artwork
      and jewelry
              
              
              (6,262
              )
              
              
              2,076Construction
              
              
              (39,023
              )
              
              
              (12,366
              )Other
              
              
              (2,453
              )
              
              
              20,512$
              (154,549
              )
              
              $
              158,645Capital
      Expenditures:Electronic
      components
              
              $
              -
              
              
              $
              90,856Artwork
      and jewelry
              
              
              17,093
              
              
              
              -Construction
              
              
              -
              
              
              
              5,099Other
              
              
              -
              
              
              
              1,780$
              17,093
              
              
              $
              97,735Depreciation
      and Amortization:Electronic
      components
              
              $
              37
              
              
              $
              57Artwork
      and jewelry
              
              
              6,485
              
              
              
              1,248Construction
              
              
              8,471
              
              
              
              4,470Other
              
              
              356
              
              
              
              71$
              15,349
              
              
              $
              5,846Total
      Assets:United
      States
              
              $
              1,222,606
              
              
              $
              54,160Europe
              
              
              2,528,461
              
              
              
              683,655$
              3,751,067
              
              
              $
              737,815
 
 37





ROYAL
STYLE DESIGN, INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR THE YEARS ENDED DECEMBER 31, 2009 AND 2008





13.           COMMITMENTS
AND CONTINGENCIES





Leases





The
Company leases various office and warehouse facilities.  The leases
contain no escalation or capital improvement funding provisions.  Two
of the leases are to related parties.  The terms of the leases vary
with various leases on a month to month basis or long-term
basis.  Some leases contain terms as to when notices are needed to
terminate the leases by either lessor or lessee.





Future
minimum lease payments for operating leases are approximately as
follows:





Year
      EndingDecember
      31,2010
              
              $
              51,9752011
              
              
              -Thereafter
              
              
              -$
              51,975


Rent
expense was $34,576 and $62,352 for the years ended December 31, 2009 and 2008,
respectively.








14. SUBSEQUENT
EVENTS





In
February 2010, the Company entered into three Letters of Intent to purchase the
outstanding common stock of Technostroy, LTD ("Technostroy"),
Tatnefteprovodstroy, OJSC ("Tatnefteprovodstroy"), and Xerxis Consulting, LLC
("Xerxis").  Under the terms of the Letters of Intent, the companies
agree to negotiate the purchase of the outstanding shares and details the
conditions for the mutual exchange of information.  The Company
expects the due diligence process will take approximately three
months.





Technostroy
is a construction and logistics company located in the Romanian
Federation.  Tatnefteprovodstroy is a company located in the Russian
Federation that constructs oil, gas and product pipelines with completed
projects in the Russian Federation, China, Kuwait, Iraq and
France.  Xerxis formerly known as Rademacher Consulting GmbH, is a
skilled labor, temporary employment agency.  Xerxis recently relocated
its headquarters to Orlando, Florida, and has a database of over 1,000 skilled
workers.





Subsequent
events have been reviewed through April 2, 2010.








38




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, 2009, 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, 2009. 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, 2009, 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 2009 that have materially affected, or are
reasonably likely to materially affect, our internal control over financial
reporting.







Item 9B. Other Information.




None.







39





PART
III




Item 10. Directors, Executive Officers, and Corporate
Governance.







We have
three officers and directors as follows:





Name
            Age
            Positions
      and Offices HeldRichard
      Lloyd
            31
            President,
      Chief Executive Officer
              and
      DirectorNikolay
      Lobachev
            27
            Chief
      Financial Officer and DirectorDmitry
      Terikov
            26
            Chief
      Operating Officer, Secretary
              and
      Director




On
December 17, 2009, Mr. Ivan Sorokoumov resigned as a director and Chief
Financial Officer, and Mr. Nikolay Lobachev resigned as Chief Executive Officer,
and the Board appointed Mr. Richard Lloyd as a director to fill the vacancy
resulting from the resignation of Mr. Sorokoumov and as Chief Executive
Officer.  In addition, Mr. Lobachev was appointed as Chief Financial
Officer.





Richard
Lloyd; CEO & Director





Mr.
Richard Lloyd, age 31, was appointed President and Chief Executive Officer of
the Company on December 17, 2009.  He is also currently the CEO of
Alfa Investment Fund, a business consulting company located in Orlando,
Florida.  He has held this position since January 2006.  In
2008 he was elected as CFO of IAC Holdings which he resigned October,
2008.  From 2002 until 2004 he served in the United States
Army.   Mr. Lloyd's education includes the University of
Maryland, in College Park,Maryland in 2004and the University of
Central Florida in 2006; he received his AA degree in Management
Information Systems from Valencia College, Orlando, Florida in
2006.  At Valencia his accompanying major
areas of study were accounting and economics.  He received his
BA degree in Economics in 2009, from the University of Berkley, Chicago,
Illinois.





Nikolay
Lobachev; CFO, Secretary & Director





Mr.
Nikolay Lobachev, 27, graduated from Moscow State Open University in Russia with
a Bachelors Degree in Law.  He is currently the Chief Financial
Officer and a director of the Company.  He became one of the three
original founding shareholders of the Company in July 2006, acted as our Chief
Executive Officer from that time to December 17, 2009.  He was
appointed our Chief Financial Officer on that date. Prior thereto, from March
2005 to July 2006, he 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.





Dmitry
Terikov; COO & Director





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.





40




Director
Independence





All of
our directors are employees and would not be classified as “independent” under
the rules of the Securities and Exchange Commission.








Employment
Agreements





At this
time, we have no employment agreements in effect with any of our executives or
employees.








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.









Involvement
in Certain Legal Proceedings.





Except as
stated below, during the past five years, no director, person nominated to
become a director, executive officer, promoter or control person of our
Company:





·
            was
      a general partner or executive officer of any business against which any
      bankruptcy petition was filed, either at the time of the bankruptcy or two
      years prior to that time;





·
            was
      convicted in a criminal proceeding or named subject to a pending criminal
      proceeding (excluding traffic violations and other minor
      offenses);





·
            was
      subject to any order, judgment or decree, not subsequently reversed,
      suspended or vacated, of any court of competent jurisdiction, permanently
      or temporarily enjoining, barring, suspending or otherwise limiting his
      involvement in any type of business, securities or banking activities;
      or





·
            was
      found by a court of competent jurisdiction (in a civil action), the
      Securities and Exchange Commission or the Commodity Futures Trading
      Commission to have violated a federal or state securities or commodities
      law, and the judgment has not been reversed, suspended or
      vacated.








Compliance
with Section 16(a) of the Securities Exchange Act of 1934, as
amended.





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 Chief Financial Officer and
director, Mr. Ivan Sorokoumov, our former Chief Financial Officer and former
director, and Dmitry Terikov, our Chief Operating Officer and director were
required to file Form 3’s on February 18, 2009.  Such forms were filed
on April 28, 2009.  Mr. Richard Lloyd, our Chief Executive Officer and
a Director, was required to file a Form 3 on November 30, 2009; Mr. Lloyd’s Form
3 and Schedule 13D were filed onJanuary 8, 2010.








Corporate
Governance





Committees
of our Board of Directors





We do not
have a separate Audit Committee. Our Board of Directors performs the functions
usually designated to an Audit Committee. We intend shortly to establish an
Audit Committee with one or more independent directors.




41





The Board
does not have standing compensation or nominating committees. The Board does not
believe a compensation or nominating committee is necessary based on the size of
the Company, the current levels of compensation to corporate officers and the
beneficial ownership by three stockholders of more than 90% of the Company’s
outstanding common stock. The Board will consider establishing compensation and
nominating committees at the appropriate time.




The
entire Board of Directors participates in the consideration of compensation
issues and of director nominees. To date, the Board of Directors has not
formally established any criteria for Board membership. Candidates for director
nominees are reviewed in the context of the current composition of the Board,
the Company’s operating requirements and the long-term interests of its
stockholders. In conducting this assessment, the Board of Directors considers
skills, diversity, age, and such other factors as it deems appropriate given the
current needs of the Board and the Company, to maintain a balance of knowledge,
experience and capability. In particular, weight is given to experience relevant
to the Company’s operations in Florida and the Russian Federation and
familiarity with international business issues.





The
Board’s process for identifying and evaluating nominees for director, including
nominees recommended by stockholders, involves compiling names of potentially
eligible candidates, conducting background and reference checks, conducting
interviews with the candidate and others (as schedules permit), meeting to
consider and approve the final candidates and, as appropriate, preparing an
analysis with regard to particular recommended candidates.








Stockholder
Communications





The Board
has not established a formal process for stockholders to send communications,
including director nominations, to the Board; however, the names of all
directors are available to stockholders in this Information Statement. Any
stockholder may send a communication to any member of the Board of Directors, in
care of the Company, at 2561 Forsythe Road, Unit D, Orlando, FL 32807
(Attention: Secretary). Director nominations submitted by a stockholder will be
considered by the full Board. Each communication should clearly specify the name
of the individual director or group of directors to whom the communication is
addressed. Communications sent by email will be delivered directly to the
Corporate Secretary, who will promptly forward such communications to the
specified director addressees. Communications sent by mail will be promptly
forwarded by the Corporate Secretary to the specified director addressee or, if
such communication is addressed to the full Board of Directors, or to the
Chairman of the Board (when one is appointed), who will promptly forward such
communication to the full Board of Directors. Due to the infrequency of
stockholder communications to the Board, the Board does not believe that a more
formal process is necessary. However, the Board will consider, from time to
time, whether adoption of a more formal process for such stockholder
communications has become necessary or appropriate.





In
general, advance notice of nominations of persons for election to our Board or
the proposal of business to be considered by the shareholders must be given to
our Secretary no earlier than the October 1 or later than December 1 preceding
the next year's annual meeting, which would be scheduled in the month of May or
June.





A
shareholder's notice of nomination should set forth (i) as to each person whom
the shareholder proposes to nominate for election or re-election as a director,
all information relating to such person that is required to be disclosed in
solicitations of proxies for election of directors, or is otherwise required, in
each case pursuant to Regulation 14A under the Securities Exchange Act of 1934
(including such person's written consent to being named in the proxy statement
as a nominee and to serving as a director, if elected); (ii) as to any other
business that the shareholder proposes to bring before the meeting, a brief
description of the business desired to be brought before the meeting, the
reasons for conducting such business at the meeting and any material interest in
such business of such shareholder and the beneficial owner, if any, on whose
behalf the proposal is made; and (iii) as to the shareholder giving the notice
and the beneficial owner, if any, on whose behalf the nomination or proposal is
made, (A) the name and address of such shareholder, as they appear on our books,
and of such beneficial owner, (B) the number of shares of our common stock that
are owned (beneficially or of record) by such shareholder and such beneficial
owner, (C) a description of all arrangements or understandings between such
shareholder and such beneficial owner and any other person or persons (including
their names) in connection with the proposal of such business by such
shareholder and any material interest of such shareholder and of such beneficial
owner in such business, and (D) a representation that such shareholder or its
agent or designee intends to appear in person or by proxy at our annual meeting
to bring such business before the meeting.





42




Other
Information about our Board of Directors





During
2009, our Board of Directors acted five times by written consent.





Attendance
of Directors at Shareholder Meetings





We do not
have a formal policy on attendance at meetings of our shareholders; however, we
encourage all Board members to attend shareholder meetings that are held in
conjunction with a meeting of our Board of Directors.




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)Richard
      Lloyd, President and Chief Executive Officer (1)
            2009
            -0-
            
            
            
            
            
            
            -0-Nikolay
      Lobachev, President and Chief Executive Officer (2)
            2007
            $64,432
            
            
            
            
            
            
            $64,4322008
            $33,085
            
            
            
            
            
            
            $33,0852009
            $5,000
            
            
            
            
            
            
            $5,000Ivan
      Sorokoumov, Chief Financial Officer (3)
            2007
            $61,904
            
            
            
            
            
            
            $61,9042008
            $33,085
            
            
            
            
            
            
            $33,0852009
            $5,000
            
            
            
            
            
            
            $5,000Dmitry
      Terikov, Chief Operating Officer
            2007
            $81,012
            
            
            
            
            
            
            $81,0122008
            $33,085
            
            
            
            
            
            
            $33,0852009
            $5,000
            
            
            
            
            
            
            $5,000


(1)
            Mr.
      Lloyd was appointed as President and Chief Executive Officer on December
      17, 2009.


(2)
            Mr.
      Lobachev resigned as President and Chief Executive Officer on December 17,
      2009, and was appointed Chief Financial Officer on that
    date.


(3)
            Mr.
      Sorokoumov resigned as Chief Financial Officer on December 17,
      2009.




43





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 March 31, 2010, 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 March 31, 2010, 93,638,511 shares of common stock were
issued and outstanding.





Name
            Number
      of
              Shares
      Owned
              Beneficially
            
            Ownership
              Percentage
              of
      ClassRichard
      Lloyd
              12609
      Weatherford Way
              Orlando,
      FL. 32832 (1)
            28,000,100
            
            29.90%Vadim
      Enikeev
              320
      Golf Brook Cir. #210
              Longwood,
      FL. 32779 (1)
            28,000,100
            
            29.90%Nikolay
      Uraev
              32
      Amirkhana Prospect, Apt. 63
              Kazan,
      Republic of Tatarstan 420132
            29,600,000
            
            31.61%Nikolay
      Lobachev
              470
      Majestic Way
              Altamonte
      Springs, FL 32714
            1,000,000
            
            1.06%Dmitry
      Terikov
              324
      Spring Leap Circle
              Winter
      Garden, FL 34787
            1,000,000
            
            1.06%All
      Officers and Directors as a Group (3 persons)
            30,000,100
            
            32.03%




(1)    Richard
Lloyd and Vadim Enikeev each beneficially own 100 shares of common stock by
reason of their 50% each ownership of Alpha Investment Fund LLC, Orlando,
Florida, which owns 200 shares of 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 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 shares 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.






Item 13. Certain Relationships and Related Transactions, and
Director Independence.




Formation of
Company





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, our former Chief Financial Officer,
for consulting services to be performed in the area of business growth and
development.




44





November 20, 2009
Acquisitions





Effective
November 20, 2009, we entered into a Share Exchange Agreement (the “Agreement”)
with the stockholders of Diversified Global Holdings, Inc., a Delaware
corporation (“DGH”), providing for the acquisition by the Company of 100% of the
outstanding shares of common stock of DGH.  In connection with the
Agreement, as of November 20, 2009, we issued 86,235,800 shares of our common
stock to the stockholders of DGH. The issuance of these 86,235,800 shares
effectively gave control of RSD to the DGH shareholders.  Our Board
saw this action as essential to the survival to the Company and as the best
course of action for our shareholders.  At a closing held on November
20, 2009, pursuant to the Agreement we acquired from the five stockholders of
DGH 100% of the outstanding shares of common stock of DGH, in exchange for our
issuance of 86,235,800 shares of our common stock, valued at
$86,235.





DGH is a
holding company that owns all of the outstanding shares or equity interests in
three companies: Forms Gallery, Inc., Delray Beach, Florida; Wood Imagination,
Inc., Orlando, Florida; and Kontakt LLC, with its principal offices located at
Kazan, Russian Federation.




In
connection with the acquisition, the following shareholders of DGH received
shares of our common stock as follows in exchange for their shares of
DGH:





Name
            Number
      of SharesRichard
      Lloyd
            28,000,000Vadim
      Enikeev
            28,000,000Nikolay
      Uraev
            29,100,000Victor
      Belitchenko
            135,800Carole
      Lynn
            1,000,000








Our
rationale for the transfer of control of our company to the shareholders of DGH
was based on the following. In operating this public company, it came to the
attention of our Board that we are in need of additional management, resources
and cash. In our last quarterly report we received a going concern qualification
in regards to our cash flow and it has become evident that, without additional
management and experience and the addition of profitable operating assets to the
Company, we will not be able to support our operations. Our construction
business, and the construction business in Florida in particular, is not
adequate to support a profitable public company.  After much thought
and consideration the Board of Directors of the Company determined that it was
in the best interest of our shareholders to transfer control of the operations
of the Company to a more capable management team and to bring in some additional
assets in the form of three companies.  Through their experience with
DGH, the Board believes that this team has the ability to expand the operations
of the Company, and in particular as being capable of procuring additional
acquisitions, so as to increase shareholder value. We view this transaction as
possibly the first stage of an expansion of the company so that it will become a
viable operating entity.






December 31, 2009
Acquisitions





Effective
December 31, 2009, we entered into three Exchange and Acquisition Agreements
(the “Agreements”) for the acquisition of three companies: Fregat Ltd., a
limited company formed under the laws of Russia, for the acquisition of which we
issued 203,698 shares of our common stock to the owner of all of the outstanding
ownership interests in Fregat; Bauelemente Kuhn GmbH, a limited liability
company formed under the laws of Germany, for the acquisition of which we issued
63,233 shares of our common stock to the owner of all of the outstanding
ownership interests in Kuhn; and Kuechen-Schilling GmbH, a limited liability
company formed under the laws of Germany, for the acquisition of which we issued
635,780 shares of our common stock to the owner of all of the outstanding
ownership interests in Schilling.  In connection with the Agreements,
as of December 31, 2009, we issued an aggregate of 902,711 shares of our common
stock to the owners of the three companies we acquired on that
date.




45





In
connection with the acquisition, the following shareholders of the acquired
companies received shares of our common stock as follows in exchange for their
shares of the subsidiary transferred by them to the Company:





Name
            Number
      of Shares
            ValuationVictor
      Schilling
            635,780
            $635,780Valerian
      Kuhn
            63,233
            $63,233Sergey
      Vilchenkov
            203,698
            $203,698TOTAL
            902,711
            $902,711








Terms
of Acquisition Agreements





Each of
the Acquisition Agreements for the companies we acquired on November 20 and
December 31, 2009, provides that each of the former owners has the right, on or
before the third anniversary of the closing date, to require us to initiate the
regulatory filing process for clearance by the SEC of the spin-off to our
shareholders of the shares of our subsidiary formerly owned by such owner, and
following SEC approval of the regulatory filings in connection with the spin-off
and the pro-rata distribution of the shares of the subsidiary as a dividend to
our shareholders, the business of the subsidiary so spun off would be operated
by its management. Exercise of these rights by the former owners of our
subsidiaries would be subject to approval of our Board of Directors. In
addition, each former owner has the right to repurchase ownership of the
subsidiary they sold to us at any time in the first year following the closing
date, by such former owner paying to us the value of that subsidiary, as such
value is determined by our Board of Directors.




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
              
              
              2009$
              39,411
              
              
              $
              34,750(2)
      Audit related fees:
              
              
              2008
              
              
              
              2009$
              36,671
              
              
              $
              34,750(3)
      Tax fees:2008
              
              
              
              2009$
              -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




46




Item 15. Exhibits and Financial Statement
Schedules.




(a)(3)
Exhibits





Exhibit
      No.
            
            Description3.1
            
            Articles
      of Incorporation, filed July 7, 2006. [Incorporated by reference to
      Exhibit 3.1 to the Company’s Form 10-12G, filed with the Commission on
      December 10, 2008.]3.1a
            
            Amendment
      to Articles of Incorporation, filed October 9, 2008. [Incorporated by
      reference to Exhibit 3.1a to the Company’s Form 10-12G, filed with the
      Commission on December 10, 2008.]3.2
            
            By-Laws.
      [Incorporated by reference to Exhibit 3.2 to the Company’s Form 10-12G,
      filed with the Commission on December 10, 2008.]10.1
            
            Form
      of Customer Estimate. [Incorporated by reference to Exhibit 10.1 to the
      Company’s Form 10-12G, filed with the Commission on December 10,
      2008.]10.2
            
            Lease
      Agreement dated September 1, 2008, between the Company and Marlon
      Industrial Park. [Incorporated by reference to Exhibit 10.2 to the
      Company’s Form 10-12G, filed with the Commission on December 10,
      2008.]10.3
            
            Share
      Exchange Agreement, dated as of November 20, 2009, between the Company,
      Diversified Global Holdings, Inc. and its stockholders.[Incorporated by reference to Exhibit 10.3 to the
      Company’s Current Report on Form 8-K, filed with the Commission on
      November 25, 2009.]10.4
            
            Exchange
      and Acquisition Agreement, dated as of December 31,2009, between the
      Company, Fregat Ltd. and its owner.[Incorporated by reference to Exhibit 10.4 to the Company’s Current Report
      on Form 8-K, filed with the Commission on December 29,
      2009.]10.5
            
            Exchange
      and Acquisition Agreement, dated as of December 31, 2009, between the
      Company, Bauelemente Kuhn GmbH and its owner.[Incorporated by reference to Exhibit 10.5 to the
      Company’s Current Report on Form 8-K, filed with the Commission on
      December 29, 2009.]10.6
            
            Exchange
      and Acquisition Agreement, dated as of December 31, 2009, between the
      Company, Kuechen Schilling GmbH and its owner.[Incorporated by reference to Exhibit 10.6 to the
      Company’s Current Report on Form 8-K, filed with the Commission on
      December 29, 2009.]31.1
            
            Certification
      of Chief Executive Officer Pursuant to Section302
      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 theSarbanes-Oxley
      Act of 2002, filed herewith.











47




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:  April
      5, 2010
              By:/s/
      Richard LloydRichard
      LloydChief
      Executive OfficerBy:/s/
      Nikolay LobachevNikolay
      Lobachev, Chief FinancialOfficer
      and Principal AccountingOfficer






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 April 5, 2010.


By:/s/
      Richard LloydRichard
      Lloyd, Chief Executive Officer and DirectorBy:/s/
      Nikolay LobachevNikolay
      Lobachev, Chief Financial Officer and DirectorBy:/s/
      Dmitry TerikovDmitry
      Terikov, Chief Operating Officer, Secretary and Director