UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


                                  FORM 10-KSB


(Mark One)

[x] Annual Report to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the Fiscal Year ended December 31, 2000.

[ ] 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. 0-22809

                                  AZUREL LTD.
                                  -----------
             (Exact name of registrant as specified in its charter)

          DELAWARE                                          13-3842844
          --------                                          ----------
(State or other jurisdiction of                         (I.R.S. Employer
 incorporation or organization)                         Identification No.)

                   1275 Bloomfield Ave., Fairfield, NJ 07004
                   -----------------------------------------
                    (Address of principal executive offices)
                                   (Zip code)

Registrant's telephone number, including area code: (973) 575-9500
                                                    --------------

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class                             Name of Each Exchange on
                                                    Which Registered
Not Applicable                                          NONE

Securities registered pursuant to Section 12(g) of the Act:

                         Common Stock, $.001 Par Value
                         -----------------------------
                                (Title of Class)

                   Redeemable Common Stock Purchase Warrants
                   -----------------------------------------
                                (Title of Class)

<PAGE>


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 prior that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.     Yes   X          No
                                            ---            ---

     Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K 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-KSB or any amendment to
this Form 10-KSB.               Yes              No  X
                                     ---            ---

     The issuer's net sales for the most recent fiscal year were $2,565,488.

     The aggregate market value of the voting stock held by non-affiliates based
upon the last sale price on March 31, 2001 was approximately $547,651.

     As of March 31, 2001 there were 6,911,796 shares of Common Stock, par value
$.001 per share, outstanding.


<PAGE>
                                     PART I

ITEM 1. BUSINESS

General

     The Company, through wholly-owned subsidiaries manufactures, distributes
and assembles perfumes and color kit products under the Company's own brand
names. In order to take advantage of the Company's product development
expertise, the Company develops color cosmetic and fragrance lines which it
markets under brand names created internally. These products are sometimes
referred to as "Branded Products." To date, the Company has developed two lines
of Branded Products internally.

     In March 2000, the Company met with the NASDAQ Listing Qualifications Panel
to respond to concerns raised by NASDAQ. On April 28, 2000, the Panel determined
to delist the Company's securities for public interest concerns. The Company
subsequently applied for and has been listed on the bulletin board.

     In May 2000, the Company sold its Private Label Group which consisted of
subsidiaries acquired in August 1996 from Michael J. Assante.

Products and Services

     The Company sells Branded Products in the United States and
internationally. In the United States, the Company sells directly to retail
outlets that sell similar products, such as chain drug stores and department
stores. The Company's personnel and independent sales representatives sell the
Branded Products in the United States. The Company entered into distribution
agreements with two foreign distributors which cover certain countries in the
Middle East and the Far East, pursuant to which such distributors will purchase
the Company's products for resale in their distribution territories. In
addition, the Company currently has a sales agency agreement with a foreign
sales agent which covers certain countries in Europe. The Company's foreign
distribution agreements are exclusive for the Far East and the Middle East and
do not require the distributor to purchase any minimum quantity of products. The
Company established a sales and distribution facility in France during the
latter part of 1998. In November 2000, the Company decided not to sell in the
International market and closed its sales facility in France.

     In October 1997, the Company began developing cosmetics, fragrances and
related products for sales under the HANG TEN trade name pursuant to a license
agreement with the owner of the HANG TEN trade name (the "Licensor"). The HANG
TEN trade name is a brand name used on men's outerwear, active wear and a wide
variety of other merchandise which has been marketed in print media in both the
United States and internationally.

     The license agreement covered the period from January 1, 1999 until
December 31, 2003. In January 2001, the licensor cancelled the license agreement
due to the fact that the Company could not meet the minimum payments required in
the agreement.

<PAGE>


     In July 1998, the Company purchased all of the assets of Ben Rickert Inc.
from Summit Bank. Ben Rickert Inc. was founded in 1970 by Ben Rickert and
throughout the years became a leading manufacturer, distributor and assembler of
luxury bath and body products. With the purchase of the Ben Rickert Inc. assets,
the Company created a wholly-owned subsidiary and named it Ben Rickert Corp.
(which was subsequently changed to Azurel Sales and Distribution), which
manufactures, distributes and assembles bath and body products and perfumes,
sold mostly in gift sets. Azurel Sales and Distribution sells its products under
its own brand names including Benandre, Privilege, and American Country Garden.
Azurel Sales and Distribution's products are sold primarily to department stores
and mass merchandisers such as, J.C. Penny, Federated Department Stores,
Marshall Field's and AAFES (Military). The purchasers of Azurel Sales and
Distribution products are primarily women between the ages of 12 and 65 years of
age.

     Azurel Sales and Distribution believes that its products are differentiated
from its competitors products by three distinct factors: 9i) aesthetics; (ii)
price (value; and (iii) and fragrance. Azurel Sales and Distribution's products
compete effectively with its competition by creating handsomely designed quality
products at reasonable prices, and its products have established the concept of
"high gift value" as its core selling strategy.

     While the Company has had discussions with other companies, it has not
entered into any other formal agreements for the development of cosmetic and
fragrance lines under brand names owned by other companies. There can be no
assurance that the Company will market successfully any original cosmetic or
fragrance line, or that the Company will enter into any additional formal
agreements for the development of cosmetic and fragrance lines for other
companies either under brand names created internally or owned by others and
licensed to the Company.

     The Company also sells cosmetic kits, which are varieties of color cosmetic
items packaged in containers and manufactured in Asia, which are custom made for
retailers such as Marshall Field's and Bloomingdales as well as cosmetic
companies. This sector of the overall cosmetic market is growing rapidly and
should continue to expand in the future.

     In October 1997, the Company acquired all of the outstanding capital stock
of Cambridge Business Services, Inc. Cambridge provides outsourcing and
distribution services such as: accounting, sales, marketing, warehousing and
other administrative and back offices services to cosmetic, fragrance and
accessory companies. The Company dissolved the Corporation during the fourth
quarter 2000 and discontinued the aforementioned service operations in February
2001.

Competition

     All aspects of the cosmetic and fragrance industry are subject to intense
competition throughout the world. In all aspects of its business, the Company
will compete with numerous companies, many of which are better known in the
industry and have established channels of distribution and substantially all of
which have greater financial and other resources than the Company. These
competitors include Estee Lauder, Revlon, Avon, Maybelline, Coty and Dial.


                                      -2-
<PAGE>

     In selling the Branded Products, licensed products and cosmetic kits and
accessories the Company competes against numerous companies. Many of these
competitors are better known in the industry, have established channels of
distribution and greater financial and other resources than the Company.

     The Company believes that the primary elements of competition in the sale
of Branded Products are product awareness and consumer acceptance of the
competing brands. Achieving market acceptance may require substantial marketing
efforts and expenditure of significant funds. The Company markets its Branded
Products to niche markets such as chain drug stores, discount stores and mass
merchandisers and develops Branded Products which it believes will appeal to the
customers of these retailers.

Government Regulation

     Various laws and regulations relating to safe working conditions, and
other employment matters, including the Occupational Safety and Health Act, are
also applicable to the Company. The Company believes it is in substantial
compliance with all material federal, state and local laws and regulations
regarding safe working conditions, and other employment matters.

Trademarks

     The Company has fifteen United States registered trademarks, Scent
Overnight(R), Scent 123(R) and Sports Extreme(R), U.S.-  Privilege(R),
Benandre(R), Bene(R), PP Parfums Privilege & Design(R), American Country
Garden(R), Ben Rickert(R), Extreme Berry(R), Extreme Girl(R), Extreme
Vanilla(R), Private Part(R), France - Privilege(R) and Japan - Ben Rickert(R).

     The right to use trademarks and trade names in connection with the sale of
the Branded Products is material to the Company's business. In cases where the
Company is the licensee of the trademark or trade name, the ownership of the
trademark or tradename will be retained by the licensor. In such cases, the
Company may be subject to material claims of infringement by third-parties and
may or may not be indemnified by the licensor.

     The Company will be the owner of brand names developed by it and will seek
to establish protection of names. There can be no assurance, however, that
trademark rights would sufficiently protect the Company's right to use such
names or that, if and when the Company files trademark applications for such
names, such applications would be approved. Notwithstanding such ownership,
third-parties may claim that such names infringe such third party's rights. Such
claims may seek to require the Company to cease use of the names as well as pay
monetary damages. At the time any such claim is brought, the Company may not
have the financial resources to defend against such claim. The cessation of the
use of any brand name used by the Company might have a material adverse effect
on it.



                                      -3-
<PAGE>


Insurance

     In view of the activities conducted by the Company, there are inherent
risks of exposure to certain liabilities including product liability and
negligence claims resulting from the use of the Company's products. The Company
currently carries a general liability insurance policy (including products
liability) and property damage insurance which provides for coverage of
$1,000,000 per occurrence and $2,000,000 in the aggregate. Additionally, the
Company has a $4,000,000 umbrella liability insurance policy per occurrence and
in the aggregate. Although the Company believes such insurance is sufficient, no
assurance can be given that the amount of the Company's present coverage will
prove to be adequate.

     The Company currently maintains officer and director liability insurance
which provides for coverage of $3,000,000 per occurrence and $3,000,000 in the
aggregate. The Company also maintains an employment practices insurance policy
with a coverage of $1,000,000 per occurrence and $1,000,000 in the aggregate.

Employees

     As of December 31, the Company employed approximately 43 persons in the
United States. Of its 43 employees, 41 were located at its Azurel Sales and
Distribution facility in New Jersey, which was comprised of one executive
officer, 29 assembly/shipping personnel, ten administrative personnel and one in
sales, marketing and customer service. The other two employees, located in New
York City, consisted of one administrative employee and one sales executive.

Seasonality and Backlog

     The cosmetic and fragrance business in general is subject to seasonal
fluctuations, with net sales in the second half of the year substantially higher
than those in the first half as a result of increased demand by retailers in the
United States in anticipation of and during the back-to-school, Thanksgiving and
Holiday seasons. The Company anticipates that the sales of Branded and Azurel
Sales and Distribution Products will follow the general industry trend. At
December 31, 2000, the backlog of orders was minimal due to the fact that the
majority of its business occurs during the holiday season.

ITEM 2. PROPERTIES

     At December 31, 2000, the Company leases 2,400 square feet of space at 509
Madison Avenue, New York, New York, which was used as its executive office. The
lease, which was to expire in April 2001 and provided for an annual base rent of
$75,000, including utilities. In January 2001, the Company closed this office as
part of an overall consolidation plan.

     At December 31, 2000, the Company leased a 55,000 square foot building in
Fairfield, New Jersey, which was used as a packaging plant and as Azurel Sales
and Distributions executive office. Approximately 10,000 square feet was used
for office space and 45,000 square feet housed its assembling, warehousing and
shipping operations. The lease was to expires in July 2004 and provided for
annual rent of approximately $336,000. In January 2001, the Company defaulted on
its rental payments and made arrangements with the landlord, which enabled it to
remain until the middle of March. At that time it moved to another facility in
Fairfield, New Jersey of approximately 10,000 square feet, with annual rental
payments of approximately $18,000 annually.


                                      -4-
<PAGE>

ITEM 2. LEGAL PROCEEDINGS

     DOWEL ASSOCIATES v. AZUREL, LTD. On March 21, 2000, plaintiff landlord of
defendant's business premises brought an action in Essex County Superior Court
in New Jersey seeking unpaid rend of $87,937.37, plus attorneys' fees and
additional future rent to accrue, and also seeking a judgment for possession of
the premises. This matter has been settled by an agreement awarding plaintiff a
judgment of possession that will be permanently stayed provided Azurel makes
timely monthly payments in compliance with an agreed upon schedule. In January
2001, the Company defaulted and relocated in March 2001.

TWINCRAFT v. BEN RICKERT CORP. AND AZUREL, LTD. This is an action in the United
States District Court for the District of Vermont in which plaintiff is in the
process of obtaining a default judgment in excess of $339,000.

W.F. CALLIGARO. In December 1999, Azurel Ltd. and Ben Rickert Corp. entered into
an agreement with this former executive (modifying a prior severance agreement)
requiring various payments to be made in exchange for a release of any further
claims. The Company defaulted on its payment obligations after making the first
payment under the agreement, and $25,262.50 remains unpaid and is subject to
acceleration together with the reasonable attorneys' fees and costs of
collecting that unpaid balance. In April 2000, plaintiff commenced an action in
Superior Court of Morris County, New Jersey seeking $27,262.50. The Court
permitted the plaintiff to attach a lien against the defendant and collected
$22,844.66, leaving a balance of $4,417.84 as of December 31, 2000.

PACTRANS AIR & SEA. In December 1999, Ben Rickert, Inc. entered into an
agreement with Pactrans Air & Sea requiring various payments to be made in
exchange for the forebearance of any legal action and the provision of a general
release upon full payment. Ben Rickert, Inc. has defaulted on its payment
obligations and cure period has expired, which will permit acceleration of the
entire amount due of $63,108.54 plus 15% for attorneys' fees and costs.

ENSIGNIA GROUP v. BEN RICKERT. CORP. In this suit, presently pending in the
Passaic County Superior Court in New Jersey, plaintiff originally sued for
$51,935.23. After several interim payments were made pursuant to an informal
settlement agreement, plaintiff obtained an arbitration award in the amount of
$7,305.93, plus interest and costs, which amount represented the balance due as
previously agreed by the defendant although the defendant has since sought to
reconsider its agreement on the grounds that the previously agreed balance was
not calculated correctly. Ben Rickert has requested a trial de novo, in effect
nullifying the arbitration award, and it is expected that a trial or a summary
judgment motion will be forthcoming shortly.

VAN CHRISTAKOS v. AZUREL LTD., GERARD SEMHON AND BEN RICKERT CORP. This is a
suit presently pending in New York State Supreme Court in which a former
executive of Azurel, Ltd. is seeking unspecified damages exceeding $500,000 on
allegations of breach of contract and related claims. Defendant has moved to
dismiss the complaint and plaintiff has cross-moved for summary judgment on
liability; oral argument on the motions was held on April 7, 2000 and the
parties are awaiting a decision from the Court.



                                      -5-
<PAGE>


CHEMAID LABORATORIES v. BEN RICKERT CORP. AND AZUREL, LTD. This is a suit
pending in Bergen County Superior Court in New Jersey seeking damages of
$94,549.98 on a guarantee agreement. Defendants have filed an answer denying the
allegations and asserting affirmative defenses including plaintiff's own breach
of contract rendering defendants' alleged obligations null and void. In March
2001, a judge ruled in favor of the Company and the case was dismissed.

NEW JERSEY FILL PACK, INC. v. NEW JERSEY LOGISTICS AND DISTRIBUTION SERVICES,
INC., JOSE AVECILLAS, ABRAHAM AVECILLAS, AND BEN RICKERT CO. This action naming
"Ben Rickert Co." as a defendant was brought in Passaic County Superior Court in
New Jersey. Pursuant to a subsequent settlement agreement, "Ben Rickert Co."
agreed to make periodic payments totaling $26,000 to the plaintiff and
$23,984.30 to New Jersey Logistics: no such payments have been made pursuant to
the agreement after an initial total payment of $5,000.

TRICOR BRAUN v. BEN RICKERT CORP. This action in Superior Court of Essex County,
New Jersey was served in April 2000 and seeks compensatory damages of $45,178.06
plus allegedly agreed-upon attorneys' fees totaling an additional 20% for a
total of $59,273.61 plus interest and costs.


ITEM 4. BANKRUPTCY

     On February 2, 2001, the Company filed a voluntary petition of bankruptcy
under Chapter 11 in the United States Bankruptcy Court, District of New Jersey,
located in Newark. All creditors have been notified and all legal proceedings,
including those indicated in ITEM 3, have been terminated.


ITEM 5. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     There were no matters submitted to a vote of security holders during the
fourth quarter of 2000.



                                      -6-
<PAGE>


                                    PART II

ITEM 6. MARKET FOR THE COMPANY'S COMMON STOCK

     As of the date hereof, the Company has outstanding 6,211,796 shares of its
Common Stock $.001 par value ("Common Stock"). The Company's Common Stock is
traded on the Nasdaq SmallCap Market ("Nasdaq SmallCap") under the symbol
"AZUR." The following table sets forth the high and low bid prices for the
Common Stock as reported by on the Nasdaq SmallCap. The high and low bid prices
reflect inter-dealer prices, without retail mark-up, mark-down or commission,
and may not represent actual transactions.

                                                COMMON STOCK

FISCAL 1999                             HIGH                    LOW

First                                   $3.28125                $1.00
Second                                   2.313                   1.063
Third                                    1.75                    1.00
Fourth                                   2.50                    0.938

FISCAL 2000

First                                   $1.531                  $0.25
Second                                   0.25                    0.15
Third                                    0.15                    0.07
Fourth                                   0.14                    0.08

     On March 31, 2001, there were approximately 59 holders of record of the
Company's 6,911,796 outstanding shares of Common Stock.

     On April 16, 2001, the last sale price of the Common Stock as reported on
the Nasdaq Bulletin Board was $0.08.

                                DIVIDEND POLICY

The Company has never paid or declared dividends on its Common Stock. The
payment of cash dividends, if any, in the future is within the discretion of the
Board of Directors and will depend upon the Company's earnings, its capital
requirements, financial condition and other relevant factors. The Company
intends, for the foreseeable future, to retain future earnings for use in the
Company's business.



                                      -7-
<PAGE>



 ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS

AZUREL LTD. AND SUBSIDIARIES

FORWARD-LOOKING STATEMENTS

     When used in this Form 10-KSB and in future filings by the Company with the
Securities and Exchange Commission, the words or phrases "will likely result"
and "the company expects," "will continue," "is anticipated," "estimated,"
"project," or "outlook" or similar expressions are intended to identify
"forward-looking statements." The Company wishes to caution readers not to
place undue reliance on any such forward-looking statements, each of which speak
only as of the date made. Such statements are subject to certain risks and
uncertainties that could cause actual results to differ materially from
historical earnings and those presently anticipated or projected. The Company
has no obligation to publicly release the result of any revisions which may be
made to any forward-looking statements to reflect anticipated or unanticipated
events or circumstances occurring after the date of such statements.

General

     Azurel, through its wholly-owned subsidiaries, manufactures, markets and
sells private label cosmetics, fragrances and skincare products and also
provides accounting, marketing, warehousing and other administrative services.

     In August 1996, Azurel acquired the stock of the Private Label Group, and
in October 1996, Azurel acquired the assets of Scent Overnight. In October 1997,
Azurel acquired the stock of Cambridge Business Services. In July 1998, Azurel's
wholly-owned subsidiary, Azurel Sales and Distribution, acquired the assets of
Ben Rickert Inc., a 28-year-old cosmetic company, for $1.5 million.

     The following discussion and analysis should be read together with the
financial statements and notes for Azurel included herein.




                                      -8-
<PAGE>

Results of Operations

     The following table sets forth, for the periods indicated, the percentage
of net sales represented by certain items included in the statements of
operations:

                                                YEAR ENDED DECEMBER 31,
                                                (Dollars in thousands)

                                          1999        %        1998       %
                                         AMOUNT               AMOUNT
                                        -------------------------------------

New Sales ......................        $ 2,565      100%     $ 4,759    100%
Cost of goods sold .............          3,547      138        6,189    130
                                        -------      ---      -------    ---
Gross profit ...................           (982)     (38)      (1,430)   (30)

Selling, general and
   administrative expenses .....          4,475      175        4,752    100
                                        -------      ---      -------    ---

Operating (loss) ...............         (5,457)    (213)      (6,182)  (130)
Interest expense ...............           (568)     (12)        (560)   (12)

Gain on sale of fixed assets ...           --        --           236      5
Other income ...................            264       10          439      9
                                        -------      ---      -------    ---
Net loss from continuing
  operations ...................         (5,761)    (225)      (6,607)  (128)
                                        -------      ---      -------    ---
Gain (loss) from operations of
  Private Label Cosmetics ......            197        8           (8)    --
Provision for loss on
  divestiture ..................           --        --        (1,156)   (24)
                                        -------      ---      -------    ---
Net loss from discontinued
  operations ...................            197        8       (1,164)   (24)
                                        -------      ---      -------    ---
Net loss .......................        $(5,564)    (217)%    $(7,231)  (152)%
                                        =======      ===      =======    ===


YEAR ENDED DECEMBER 31, 2000 (THE "2000 PERIOD") AND YEAR ENDED DECEMBER 31,
1999 (THE "1999 PERIOD")

Net sales of $2,565,488 for the year ended December 31, 2000 declined $2,193,225
or 46.1%, as compared to the 1999 Period. Sales decreased in the 2000 Period due
to increased competitive pressure and the Company's decision to discontinue its
bath and body products.

Cost of goods sold for the 2000 Period was $3,547,111 or 138% of net sales, as
compared to $6,188,999 or 130% of net sales for the 1999 Period. The decrease in
gross profit percentage in the 2000 Period was primarily related to the sales of
closeout merchandise and the disposal of obsolete inventory.

Selling, general and administrative expenses for the 2000 Period were
$4,475,390 or 174.4% of sales as compared to $4,779,552 or 100% of sales for the
1999 Period. The increase in SG&A expenses was due primarily to expenses
associated with the Azurel Sales and Distribution operations.

Interest expense was $567,815 for the 2000 Period, compared to $559,952 for the
1999 Period. The increase represents interest expense associated with the
increase of notes payable offset by the elimination of the Company's revolving
line of credit.

Non-operating income in 2000, includes an overestimate of loss relating to the
sale of the Company's Private Label Group operations, while non-operating income
in 1999 includes $500,000 related to a web design and consulting agreement, and
a $236,000 gain on the sale of fully depreciated soap machines at the Azurel
Sales and Distribution operation.


                                      -9-
<PAGE>


LIQUIDITY AND CAPITAL RESOURCES

     From inception to date, Azurel's operations have been funded by a
combination of debt and equity financings. Azurel completed its initial public
offering of its securities in August 1997, whereby the Company issued 1,200,000
shares of common stock and 1,200,000 common stock purchase warrants. The Company
received approximately $5,538,000 from its initial public offering. In addition,
prior to the Company's initial public offering, it sold 750,000 shares of Common
Stock at $2.00 per share from February through July 1996 and in January and
April of 1997 the Company secured additional debt financing in connection with
the completion of private placements of $200,000 and $350,000 respectively,
which were repaid upon the completion of the Company's initial public offering.

     In December 1997 the Company secured a 4-year term loan of $800,000 at
11.3% from GE Capital. Such loan is secured by the Company's existing machinery
and equipment. During 1998, the Company arranged a new machinery and equipment
line of credit with CIT, which finances 100% of new machinery and equipment
purchases of the Private Label Group over a five-year term at a rate of
approximately 10.5%, which line of credit will remain with the Private Label
Group upon completion of the sale. In 1998, the Company purchased $281,518 of
equipment through capital leases under this arrangement and an additional
$80,490 in 1999. In February 1998, the Company secured a revolving lien of
credit of $3,500,000 with Finova Capital Corporation which will be transferred
to the Private Label Group upon completion of the sale. This line of credit
bears an interest rate of 2.5% above the prime rate and is secured by the
Company's receivables, inventory and a second lien on machinery and equipment.
An additional line of credit of $4,000,000 was secured for the Company's
wholly-owned subsidiary, Azurel Sales and Distribution, in September 1998 with
Finova Capital Corp. The terms and expiration date are the same as the
$3,500,000 line of credit except that the $,4000,000 line is secured by Azurel
Sales and Distribution's receivables, inventory and a first lien on Azurel Sales
and Distribution's machinery and equipment. In September 1999, Finova notified
the Company of a default condition with respect to its security agreement,
pursuant to which it increased the interest rate by an additional 2%, to 4 1/2%
above the prime rate, in accordance with the terms of the security agreement.
However, Finova has continued to provide financing to the Company under modified
terms, including a $15,000 per month administration fee.

     In May 2000, the Company sold its Private Label Group operation and the
financing arrangement with Finova Capital was terminated.

     On August 12, 1998, the Company sold shares of its Series A Convertible
Preferred Stock receiving net proceeds of approximately $1,237,587.

     In April 1999 and May 1999, the Company sold an aggregate of 716,667 shares
of its Common Stock at a price of $1.50 per share, for an aggregate sale price
of $1,075,000, to several private investors, pursuant to an exemption from the
registration requirements of the Securities Act of 1933, as amended.
Additionally, an aggregate of 179,167 warrants (one warrant for every four
shares purchased) to purchase shares of the Company's Common Stock at an
exercise price of $2.00 per share were issued to the above investors. In
December 1999, the Company sold an additional 100,000 shares of its common stock
at a price of $1.00 per share in a private transaction pursuant to an exemption
from the registration requirements of the Securities Act of 1933, as amended.



                                      -10-
<PAGE>

     In May 1999, the Company obtained $1,528,167, secured by an 8% 2-year
promissory note and a majority of PLC common stock.

     In September 1999, the Company sold $800,000 of its Series C Convertible
Preferred Stock.

     In June 1999, the Company entered into a web-site design and consulting
agreement with Tadeo E-Commerce Corp. In connection with the agreement Tadeo
paid the Company a $500,000 non-refundable fee for the right to develop the
website and for the Company's consulting services pertaining to the cosmetics
industry. The Company believes it has substantially fulfilled all of its
requirements under the contract prior to June 30, 1999. In connection with the
agreement, Tadeo is entitled to receive a 5% royalty on gross revenues generated
from the website until it receives an aggregate of $500,000 in royalties, at
which time its royalty shall be reduced to 3% of gross revenues generated from
the website.

     In May 2000, the Company sold its interest in the Private Label Group for
an aggregate of $3,085,821 plus forgiveness of $600,000 of indebtedness to
Michael Assante.

     In March 2001, the Company issued 700,000 shares of its common stock to
private investors for an aggregate of $350,000.

     During the last 9 months of 2000, the Company raised approximately $500,000
through the issuance various unsecured notes at an interest rate of 8% per
annum.

     Net loss from operations of $5,563,727 were partially funded by a decrease
in inventories, $2,020,694, a decrease in accounts receivable, $1,217,067, and
an increase in accounts payable and accrued expenses, $1,014,068.

Net cash provided by financing activities was $887,497. the proceeds from the
sale of the Company's Private Label Group, $1,212,797, borrowings on notes,
$497,533, and net proceeds from issuance of common stock, $350,000, were
partially offset by a decrease in the Company's revolving line of credit,
$1,168,950.



                          ITEM 8. FINANCIAL STATEMENTS


                          ITEM 1 FINANCIAL STATEMENTS
                          ---------------------------
                          AZUREL LTD. AND SUBSIDIARIES
                          ----------------------------
                           CONSOLIDATED BALANCE SHEET
                           --------------------------
                         DECEMBER 31, 2000 (UNAUDITED)
                         -----------------------------
<TABLE>
<CAPTION>

                                     ASSETS
                                     ------
CURRENT ASSETS:
<S>                                                             <C>
        Cash                                                    $   15,796
        Accoutns receivable, net of allowance
                for doubtful accounts of $51,000                   617,557
        Inventory                                                  704,103
        Due from related parties                                    18,098
        Prepaid expenses and other current assets                   18,050
                                                                ----------
                TOTAL CURRENT ASSETS                             1,373,604

FURNITURE AND EQUIPMENT                                            185,773

GOODWILL                                                           135,197

LONG-TERM NOTE RECEIVABLE                                        1,800,000

OTHER ASSETS                                                         2,119
                                                                ----------
                                                                $3,496,693
                                                                ==========
                     LIABILITIES AND STOCKHOLDERS' DEFICIT
                     -------------------------------------

CURRENT LIABILITIES:
        Bank Loans                                              $   13,656
        Accounts payable                                         2,360,618
        Notes payable                                            3,154,533
        Accrued expenses and other liabilities                   2,072,104
        Current portion of long-term debt                        1,577,741
        Capital lease obligation - current portion                 200,000
                                                                ----------
                TOTAL CURRENT LIABILITIES                        9,378,652

MINORITY INTEREST                                                      357

STOCKHOLDERS' DEFICIT:
        Preferred stock $.001 par value, authorized
                4,000,000 shares; issued and
                outstanding 1,001,500 shares                     2,237,587
        Common stock, $.001 par value, authorized
                24,000,000 shares, issued and
                outstanding 6,911,796 shares                         6,912
        Additional paid-in-capital                               8,998,983
        Accumulated deficit                                    (17,125,084)
        Translation loss                                              (714)
                                                                ----------
                TOTAL STOCKHOLDERS' DEFICIT                     (5,882,316)
                                                                ----------
                                                                $3,496,693
                                                                ==========
</TABLE>

                See notes to consolidated financial statements.


                                     F-1


<PAGE>


                          AZUREL LTD. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF OPERATIONS
                                  (UNAUDITED)
<TABLE>
<CAPTION>

                                                  YEARS ENDED DECEMBER 31,
                                                ----------------------------
                                                   2000            1999
                                                -----------     ------------

<S>                                             <C>             <C>
NET SALES                                       $ 2,565,488     $ 4,758,713

COST OF GOODS SOLD                                3,547,411       6,188,999
                                                -----------     -----------
GROSS PROFIT (LOSS)                                (981,923)     (1,430,286)

SELLING, GENERAL AND ADMINISTRATIVE
        EXPENSES                                  4,475,390       4,779,552
                                                -----------     -----------
LOSS FROM OPERATIONS                             (5,457,313)     (6,209,838)

INTEREST EXPENSE                                   (567,815)       (559,952)

GAIN ON SALE OF FIXED ASSETS                        --              236,000

OTHER INCOME                                        264,140         439,404
                                                -----------     -----------
NET LOSS FROM CONTINUING OPERATIONS             $(5,760,987)    $(6,094,386)

DISCONTINUED OPERATIONS:
        Income (loss) from operations of
                Private Label Group                 197,260          (&,185)
        Provision for loss on sale of
                Private Label Group                 --           (1,156,381)
                                                -----------     -----------
NET INCOME FROM DISCONTINUED OPERATIONS             197,260      (1,163,566)
                                                -----------     -----------
NET LOSS                                        $(5,563,727)    $(7,257,952)
                                                ===========     ===========
BASIC (LOSS) EARNINGS PER COMMON SHARE:
        CONTINUING OPERATIONS                   $     (0.87)    $     (1.03)
        DISCONTINUED OPERATIONS                        0.03           (0.20)
                                                -----------     -----------
BASIC LOSS PER COMMON SHARE                     $     (0.84)    $     (1.23)
                                                ===========     ===========

WEIGHTED AVERAGE COMMON SHARES
        OUTSTANDING                               6,620,130       5,905,480
                                                ===========     ===========

</TABLE>

                See notes to consolidated financial statements.


                                      F-2


<PAGE>

                          AZUREL LTD. AND SUBSIDIARIES
                CONSOLIDATED STATEMENT OF STOCKHOLDERS' DEFICIT
         FOR THE PERIODS ENDED DECEMBER 31, 1999 AND DECEMBER 31, 2000

<TABLE>
<CAPTION>


                                                                              ADDITIONAL                 CUMULATIVE
                                     PREFERRED STOCK        COMMON STOCK       PAID-IN     ACCUMULATED   TRANSLATION
                                  SHARES       AMOUNT     SHARES     AMOUNT    CAPITAL       DEFICIT      ADJUSTMENT    TOTAL
                                ---------    ----------  ----------  -------  ----------  ------------    --------    -----------

<S>                                 <C>     <C>         <C>         <C>       <C>         <C>             <C>        <C>
Balance at January 1, 1999          1,500   $1,237,587  5,318,745   $ 5,319   $7,475,476  $ (4,303,405)   $    --    $ 4,414,977
        Sale of common stock          --        --        893,051       893    1,174,207        --             --      1,175,100
        Sale of convertible
          preferred stock       1,000,000    1,000,000     --          --        --             --             --      1,000,000
        Net loss                      --        --         --          --        --         (7,257,952)        --     (7,257,952)
        Change in translation
          adjustment                  --        --         --          --        --             --          (9,916)       (9,916)
                                ---------   ----------  ----------  -------   ----------  ------------    --------   -----------
Balance at December 31, 1999    1,001,500   $2,237,587  6,211,796   $ 6,212   $8,649,683  $(11,561,357)   $ (9,916)  $  (677,791)
                                ---------   ----------  ----------  -------   ----------  ------------    --------   -----------
        Sale of common stock          --        --        700,000       700      349,300        --             --        350,000
        Net loss                      --        --         --          --        --         (5,563,727)        --     (5,563,727)
        Change in translation
          adjustment                  --        --         --          --        --             --           9,202         9,202
                                ---------   ----------  ----------  -------   ----------  ------------    --------   -----------
Balance at December 31, 2000    1,001,500   $2,237,587  6,911,796   $ 6,912   $8,998,983  $(17,125,084)   $   (714)  $(5,882,316)

</TABLE>


                 See notes to consolidated financial statements


                                      F-3


<PAGE>


                          AZUREL LTD. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                                  (UNAUDITED)


                                                  YEARS ENDED DECEMBER 3
                                                  ----------------------
                                                  2000            1999
                                                  ----            ----
CASH FLOWS FROM OPERATING ACTIVITIES:
     Net Loss                                 $(5,563,727)   $ (7,257,952)

     Adjustments to reconcile net loss
     to net cash used in operating
     activities:
          Depreciation                             53,299          22,254
          Amortization                              7,956           8,169
          Loss (gain) on disposal of fixed
          assets                                    3,305        (236,000)
          Loss on debt forgiveness                    --            --
          Provision for discontinued operations   132,000       1,156,381
          Increase in minority interest               --              357

     Changes in assets and liabilities:
          Decrease in accounts receivables      1,217,067          756,745
          Decrease in inventories               2,020,694          629,902
          Decrease (increase) in prepaid
            expenses and other current assets     119,423          (81,526)
          Decrease in due from related parties     13,186             --
          Decrease (increase) in other assets     108,402          (75,481)
          Increase in accounts payable and
            accrued expenses                    1,014,068        1,091,572
          Increase in net assets of
            discontinued operations                 --             201,732
                                                 --------       ----------
          NET CASH USED IN OPERATING ACTIVITIES  (874,328)      (3,723,251)
                                                 --------       ----------
     CASH FLOWS FROM INVESTING ACTIVITIES:

          Purchase of property and equipment      (12,691)        (213,899)
          Disposal of property and equipment          879          236,000
                                                 --------       ----------
          NET CASH (USED IN) PROVIDED
            BY INVESTING ACTIVITIES               (11,812)          22,101
                                                 --------       ----------
     CASH FLOW FROM FINANCING ACTIVITIES:
          Proceeds from repayment of short-term
          note receivable                               0              --
          Decrease in revolving line of credit (1,168,950)      (2,552,770)
          Increase in bank loans                   13,656              --
          Proceeds from borrowing on notes        497,533        2,757,000
          Borrowings from long term debt              --         1,742,104
          Principal payments of capital
            lease obligations                         --            (2,105)
          Payment of long term debt               (27,539)        (207,650)
          Net proceeds from issuance
            of common stock                       350,000        1,175,100
          Net proceeds from issuance of
            preferred stock                          --            800,000
          Proceeds from sale of Private
            Label Group                         1,212,797             --
                                               ----------       ----------
          NET CASH PROVIDED BY
            FINANCING ACTIVITIES                  877,497        3,711,679
                                               ----------       ----------
          Effect of exchange rate                   9,202           (9,916)

     NET INCREASE IN CASH                             599              613

     CASH, beginning of period                     15,237           14,624
                                               ----------       ----------
     CASH, end of period                      $    15,797      $    15,237
                                               ==========       ==========


                See notes to consolidated financial statements.

                                      F-4


<PAGE>

               Yes  __                       No __


<PAGE>



                          AZUREL LTD. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                                  (UNAUDITED)


<TABLE>
<CAPTION>

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

<S>                                             <C>             <C>
        Cash paid for interest                  $  107,862      $  353,511
                                                ==========      ==========
        Cash paid for income taxes              $   11,908      $    4,087
                                                ==========      ==========
        Notes received in connection with
          sale of subsidiary                    $2,024,403      $    --
                                                ==========      ==========
        Conversion of notes to common stock     $  350,000      $    --
                                                ==========      ==========

</TABLE>


                 See notes to consolidated financial statements.

                                      F-5


<PAGE>

                          AZUREL LTD. AND SUBSIDIARIES
                          ----------------------------

                         NOTES TO FINANCIAL STATEMENTS
                         -----------------------------

                          YEAR ENDED DECEMBER 31, 2000
                          ----------------------------

                                  (Unaudited)
                                  -----------

1.   BASIS OF PRESENTATION
     ---------------------

     The accompanying consolidated financial statements as of December 31, 2000
     have note been audited by independent auditors, but in the opinion of
     management, such unaudited statements include all adjustments consisting of
     normal recurring accruals necessary for a fair presentation of the
     financial position, the results of operations and cash flows for the year
     ended December 31, 2000.

     The consolidated financial statements should be read in conjunction with
     the financial statements and related notes concerning the Company's
     accounting policies and other matters contained in the Company's annual
     report on Form 10-KSB. Certain prior year amounts have been reclassified to
     conform with the current year's presentation.

2.   GOING CONCERN
     -------------

     The accompanying financial statements have been prepared assuming that the
     Company will continue as a going concern. The Company sustained losses of
     approximately $5,564,000 for the year ended December 31, 2000 and had a
     working capital deficiency of approximately $8,005,000 as of that date.
     Although the Company was current with respect to payments of year 2000
     payroll tax obligations, it has not remitted 1999 third and fourth quarter
     federal and state payroll taxes of approximately $325,000. These conditions
     raise substantial doubt about the Company's ability to continue as a going
     concern. Management's plans with respect to these matters include
     restructuring its existing debt, raising additional capital through
     issuance of stock and debentures, and ultimately developing a viable
     business through new leadership. The accompanying financial statements do
     not include any adjustments that might be necessary should the Company be
     unable to continue as a going concern.

3.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
         ------------------------------------------

         a.    Principles of consolidation - The consolidated financial
               statements include the accounts of the Company and its wholly
               owned subsidiaries. All material intercompany transactions and
               balances have been eliminated.

         b.    Accounting estimates - The preparation of financial statements in
               accordance with generally accepted accounting principles requires
               management to make significant estimates and assumptions that
               affect the reported amounts of assets and liabilities at the date
               of the financial statements and the reported amounts of revenues
               and expenses during the reporting period. Actual results could
               differ from those estimates.

         c.    Inventories - Inventories are recorded at the lower of cost or
               market. Cost was determined using the FIFO method.

         d.    Property and equipment - Property and equipment are stated at
               cost and depreciated using the straight-line method over the
               estimated useful lives of the assets.



                                      F-6



<PAGE>

                          AZUREL LTD. AND SUBSIDIARIES
                          ----------------------------
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
             ------------------------------------------------------


         e.    Fair value of financial instruments - The carrying amounts
               reported in the balance sheet for cash, receivables, accounts
               payable, and accrued expenses approximate fair value based on the
               short-term maturity of these instruments.

         f.    Income taxes - The Company accounts for income taxes under the
               provisions of Statement of Financial Accounting Standards No.
               109, "Accounting for Income Taxes" (SFAS No. 109). SFAS No. 109
               requires the recognition of deferred tax assets and liabilities
               for both the expected impact of differences between the financial
               statements and tax basis of assets and liabilities, and for the
               expected future tax benefit to be derived from tax loss and tax
               credit carryforwards. SFAS No. 109 additionally requires the
               establishment of a valuation allowance to reflect the likelihood
               of realization of deferred tax assets.

         g.    Stock based compensation - The Company accounts for employee
               stock transactions in accordance with APB Opinion No. 25,
               "Accounting For Stock Issued To Employees." The Company has
               adopted the proforma disclosure requirements of Statement of
               Financial Accounting Standards No. 123, "Accounting For
               Stock-Based Compensation."

         h.    Goodwill - Goodwill is amortized on a straight line basis over a
               period of 20 years. The Company periodically assesses the
               recoverability of the cost of its goodwill for impairment.

         i.    Impairment of long-lived assets - The Company reviews long-lived
               assets for impairment whenever circumstances and situations
               change such that there is an indication that the carrying amounts
               may not be recovered. At December 31, 2000, the Company believes
               that there has been no impairment of its long-lived assets.


         j.    Earnings per share - Basic net loss per common share is based on
               the weighted average number of shares outstanding. Potential
               common shares includable in the computation of fully diluted per
               share results are not presented in the financial statements as
               their effect would be anti-dilutive.

  4.     DISCONTINUED OPERATIONS
         -----------------------

         In December 1999, the Company defaulted on its note to the former
         shareholder of approximately $600,000 and current President of the
         Private Label Group. Such officer issued a notice of default and the
         collateral on such note representing one third of the stock of Private
         Label Group was transferred to the officer.

         In May, the Company sold its remaining two thirds interest in the
         Private Label Group to its President for cash of $886,000 and two
         notes, one

                                       F-7

<PAGE>


                          AZUREL LTD. AND SUBSIDIARIES
                          ----------------------------
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
             ------------------------------------------------------


         DISCONTINUED OPERATIONS - CONTINUED
         -----------------------------------


         for $1,800,000 bearing interest of 7.5 % per annum due 24 months after
         the closing date of the sale and another note for $400,000 bearing
         interest at 9% per annum due 12 months after the closing date of the
         sale. In addition, receivables of approximately $400,000 due from the
         Private Label Group are to be repaid. The Company's two thirds interest
         in the Private Label Group had been pledged as collateral for
         approximately $1,500,000 in notes to another entity. On April 10, 2000,
         the Company and the lender agreed to a substitution of collateral being
         the aforementioned $1,800,000 note.


                                                           FOR THE YEAR ENDED
         RESULTS OF OPERATIONS                               DECEMBER 31,
         ---------------------                               ------------


                                                         1999           2000
                                                         ----           ----
         Net Sales                                   $14,025,390    $ 7,349,015
         Gain/Loss from operations
          (net of income tax benefit)                $    (7,185)   $   197,260
         Loss on disposal                            $(1,156,381)
                                                     -----------    -----------
         Total gain/loss on discontinued operations  $(1,163,566)   $   197,260
                                                     ===========    ===========




                                      F-8
<PAGE>


                          AZUREL LTD. AND SUBSIDIARIES
                          ----------------------------
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
             ------------------------------------------------------



5.       INVENTORIES

         Inventories at December 31, 2000 consisted of the following:


              Raw Materials             $  270,997
              Work In Process               18,312
              Finished Goods               414,794
                                        ----------
                                        $  704,103
                                        ==========

6.       NOTES RECEIVABLE

         The $1,800,000 long-term note receivable from Private Label Cosmetics,
         Inc., pursuant to the sale of the Company's ownership in its subsidiary
         in May 2000, is collateralized against a $1,528,167 note, payable in
         June 2001. Furthermore, the note is in the hand of the lender's
         attorney who also issued a default letter to the Company relative to
         non-payment of interest as explained above.


                                      F-9


<PAGE>



                          AZUREL LTD. AND SUBSIDIARIES
                          ----------------------------
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
             ------------------------------------------------------



7.       RELATED PARTY TRANSACTIONS

         Amounts due from related parties consist of advances to officers in the
         amount of $18,098.


8.       PROPERTY AND EQUIPMENT

         The following is a summary of property held under capital lease at
         December 31, 2000:

                   DESCRIPTION                              AMOUNT
                   -----------                              ------
         Computer software equipment                       $200,000
         Less: Accumulated Depreciation                      46,671
                                                           --------
                                                           $153,329
                                                           ========

9.       GOODWILL:

         Goodwill which results from the acquisition of Cambridge Business
         Services is as follows:

                                                 ESTIMATED
                                                USEFUL LIFE        COST
                                                -----------        ----
         Goodwill                                20 Years        $159,059
         Less accumulated amortization                             23,862
                                                                 --------
                                                                 $135,197
                                                                 ========



                                      F-10
<PAGE>


                          AZUREL LTD. AND SUBSIDIARIES
                          ----------------------------
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
             ------------------------------------------------------


10.      NOTES PAYABLE

         During the first quarter of 2000, the Company borrowed an aggregate of
         $350,000 in unsecured short term notes at an interest rate of 8%. These
         notes were converted to 700,000 shares of the Company's common stock at
         a price of $0.50 per share in June 2000. The Company has extended a
         $500,000 note to a lender which came due during the first quarter of
         2000 to the first quarter of 2001, in return for a security interest in
         the Company's inventory. Another lender notified the Company that it
         was in default of payment of a $300,000 note due on July 19, 2000,
         along with accrued interest of $27,000. A third lender notified the
         Company on August 2, 2000, that it is in default of its obligations to
         repay a $550,000 note along with approximately $50,000 of interest on
         June 30,2000. The same lender also notified the Company, on the same
         day, that it is in default of making interest payments of approximately
         $130,000 on a two-year, $1,528,167 note, as of June 30,2000. This note
         is collateralized by the $1,800,000 long term note receivable from
         Private label Cosmetics, Inc. (see Note 4). Azurel borrowed an
         aggregate of approximately $328,000 in unsecured notes during the
         third quarter, and $170,000 during the fourth quarter, at an interest
         rate of 8%.


11.      REVOLVING CREDIT FACILITY

         On May 26, 2000, on the same day that the Company consummated the sale
         of its Private Label subsidiary, the Company used the proceeds obtained
         at the closing, to pay off the remaining balance on its revolving line
         of credit.




                                      F-11
<PAGE>


                          AZUREL LTD. AND SUBSIDIARIES
                          ----------------------------
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
             ------------------------------------------------------



12.      LONG-TERM DEBT
         --------------

         In May 2000, the Company sold Private Label Group and repaid the
         balance remaining to the financial institutions.

         The following is a summary of long-term debt at December 31, 2000:

         Note payable with interest at 8% per annum, payable
         monthly. Principal amount due June 2001 and is
         secured by a $1,800,000 long-term note received in
         connection with the sale of the Private Label
         Group. The Company granted 500,000 warrants at an
         exercise price of $1.50 per share to the lender
         which was reduced to $.60 per share as
         consideration of the substitution of collateral.             $1,528,167

         Note payable to shareholder, interest at 9%,
         principal payment due April 2000.                                49,574

                                                                      ----------
                                                                       1,577,741
         Less: current portion                                         1.577,741
                                                                      ----------
                                                                      $        0
                                                                      ==========

         Long-term debt matures as follows:

                           2001                                        1,577,741
                                                                      ----------
                                                                      $1,577,741
                                                                      ==========

         The fair value of the Company's long term debt approximates its
         carrying amount.




                                      F-12


<PAGE>

13.      LEGAL

         The Company has received legal notification of claims from certain
         vendors and former employees and is in the process of negotiating
         settlements to most of these claims. In February 2001, the Company
         filed a voluntary petition for bankruptcy under Chapter 11. All
         creditors have been notified and all legal proceedings against the
         Company have been terminated.


14.      PURCHASE ORDER FINANCING AND FACTORING AGREEMENT

         In July 2000, the Company signed a purchase order financing and
         factoring agreement, whereby 100 percent of its overseas purchases
         could be funded by letters of credit, and the receivables generated by
         the sale of this merchandise would be factored. The aforementioned
         inventory and receivables would be secured by the financing company and
         factoring company, respectively. In February 2001, subsequent to filing
         bankruptcy. Azurel made the factor whole, and terminated the agreement.



                                      F-13


<PAGE>


                                    PART III

ITEM 9.  DIRECTORS NAD EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSON


NAME                AGE       POSITION
----                ---       --------

Norman Grief        69        Director

Brian Bookmeier     42        Director



OTHER SIGNIFICANT EMPLOYEES

NAME                AGE       POSITION
----                ---       --------

Edward Adamcik      58        Vice-President, Operations

     Directors are elected to serve until the next meeting of sotck holders nad
until their successors are duly elected nad qualified. Meetings of stockholders
of the Company will be held on an annual basis. However, if at any time an
annual meeting is not held for the election and qualified. Vacancies and newly
created directorships reesulting from any increase in the number of directors
may be filled by a majority vote of Directors then in office. Officers are
appointed by, and serve at the discretion of,t he Board of Directors.
Non-employee directors are eligible to receive options under the 1997 Stock
Option Plan.

     The following is a brief summary of the background of each director,
executive officer and significant employee of the Company:

     NORMAN GRIEF was elected to the Company's Board of Directors on February
23, 1998.  Mr. Grief is presently the Chief Executive officer of The Jarrott
Group, Inc., a full service marketing agency with a specialty in developing
cosmetic brands, a position which he has served as since January 3, 1995.  From
March 1, 1981 to December 1, 1994 Mr. Grief was the President of Givandan.
From March 9, 1970 to December 15, 1986 Mr. Grief served as the Vice President
of Research and Development at Revlon.

     BRIAN BOOKMEIER was appointed as a director of the Company in March 2000.
Since August 1997, Mr. Bookmeier has been the Vice President of Seven Sons,
Inc., d/b/a Las Vegas Gold & Tennis, a company in the business of franchised
retailing of golf and tennis equipment. From July 1995 to February 2000, Mr.
Bookmeier served as the President, Chief Executive Officer and a director or
TekInsight.com, Inc., a publicly-traded company. From 1989 Mr. Bookmeier served
as Executive Vice President and a director of Patient Care Services, a home
medical equipment supply company that specialized in diabetes management, and
the sale of related equipment and supplies, until its merger into
TekInsight.com. Mr. Bookmeier has been a director of the American Diabetes
Association since June 1995.

     EDWARD ADAMCIK joined the Company in September 1998.  Mr. Adamcik worked as
Vice-President for various companies from 1992 to 1998.  From 1987 to 1992, Mr.
Adamcik was Chief Financial Officer and Vice-President of Operations for Parlux
Fragrances Inc.  Mr. Adamcik served as Controller of Onyx Chemical from 1976 to
1986 and for ten years prior, Mr. Adamcik was Controller of Faberge Inc.


<PAGE>


     MEETINGS OF THE BOARD OF DIRECTORS

          The Company's Board of Directors met in July 2000.  At this meeting, a
majority of the Board of Directors passed a revolution to relieve Mr. Gerard
Semhon of his duties as Chairman and Chief Executive Officer of the Company.
The Board appointed Mr. Norman Grief as Chairman of the Board and agreed to run
the Company by committee going forward.  The position of Chief Executive Officer
remained unfilled for the remainder of the year.

ITEM 10.  EXECUTIVE COMPENSATION

                         SUMMARY OF COMPENSATION TABLE

     The following table sets forth all cash compensation for services rendered
in all capacities to be Company, for the year ended December 31, 2000.  There
was one other person whose compensation in 2000 exceeded $100,000 per annum.

<TABLE>
<CAPTION>



                                                       RESTRICTED               ALL OTHER
NAME AND PRINCIPAL                                       STOCK     OPTIONS       C0MPEN-
POSITION                 YEAR      SALARY    BONUS      AWARDS       SARS        SATION
--------                 ----      ------    -----      ------       ----        ------
<S>                    <C>       <C>         <C>        <C>         <C>          <C>
Edward Adamcik           2000      $104,000   -0-        -0-         -0-          -0-
Vice-President
Operations

</TABLE>

OPTIONS TO NAMED EXECUTIVE OFFICER

     There were no options granted to any of the executive officers named in the
Summary Compensation Table above.

EMPLOYMENT AGREEMENTS

     As of December 31, 2000, there were no employment agreements.

STOCK OPTION PLAN

     In March 1997 the Board of Directors adopted, and the stockholders
subsequently approved, the Company's 1997 Stock Option Plan (the "1997 Plan").
In December 1998, the 1997 Plan was amended whereby the number of options to
acquire common stock which may be granted was increased from 750,000 to
1,750,000. The 1997 Plan provides for grants to officers and other employees of
the Company, non-employee directors, consultants and advisors and other persons
who may perform significant services on behalf of the Company and will be
administered by the Board of Directors, or a committee (the "Committee") of two
or more directors, each of whom is a "Non-Employee Director," within the meaning
of Rule 16b-3 under the Exchange Act. Pursuant to the 1997 Plan, options to
acquire an aggregate of 1,750,000 shares of Common Stock may be granted subject
to adjustment as provided in the 1997 Plan.

     The 1997 Plan authorizes the issuance of incentive stock options ("ISOs"),
as defined in Section 422A of the internal Revenue Code of 1986 (the "Code"), as
amended, as well as non-qualified stock options ("NQSOs").  Only "employees"
(within the meaning of Section 3401(c) of the Code) of the Company shall be
eligible for the grant of Incentive Stock Options.  The exercise price of each
ISO may not be less than 100% of the fair market value of the Common Stock at
the time of grant, except that in the case of a grant to an employee who owns
10% or more of the then outstanding stock of the Company or a subsidiary or
parent of the Company (a "10% Stockholder"), the exercise price shall be at
least 110% of the fair market value of the Common Stock on the date of grant.
The exercise price of each NQSO is determined by the Committee, but shall not be
less than 85% of the fair market value of the Common Stock on the date of the
grant.  Notwithstanding the foregoing, the exercise price of any option granted
on or after the effective date of the registration of any class of equity
security of the Company pursuant to Section 12 of the Exchange Act, and prior to
six months after the termination of such registration, may be no less than 100%
of the fair market value per share on the date of the grant.  The Board or the
Committee shall provide, in each stock option agreement, when the term of the
option subject to such agreement expires and the date when it becomes
exercisable, but in no event will an option granted under the 1997 Plan be
exercisable after the expiration of ten years from the date it is granted.
Options may not be transferred during the lifetime of an option holder and are
only exercisable during the optionee's lifetime only by the optionee or by his
or her guardian or legal representative.  The 1997 Plan shall terminate
automatically as of the close of business on the day preceding the 10th
anniversary date of its adoption, subject to earlier termination.

     To the extent Fair Market Value, as defined in the Code, of Common Stock
with respect to which Incentive Stock Options granted hereunder are exercisable
for the first time by an optionee in any calendar year exceeds $100,000, such
options granted shall be treated as NQSO's to the extent required by Section 422
by the Code.

     If the outstanding shares of Common Stock are changed by reason of an
adjustment to the capitalization of the Company or as a result of a merger or
consolidation, an appropriate adjustment shall be made by the Board of the
Committee in the number, kind and price of shares as to which options may be
granted and exercised.

     Subject to the provisions of the 1997 Plan, the Board of Directors or the
Committee has the authority to determine the individuals to whom stock options
are to be granted, the number of shares to be covered by each option, the
exercise price, the type of option, the option period, the restrictions, if any,
on the exercise of the option, the terms for payment of the option price and all
other terms and provisions of such options (which need not be identical).
Payments by holders of options, upon exercise of an option, may be made (as
determined by the Board or the Committee) in cash or such other form of payment
as may be permitted under the 1997 Plan, including without limitation, by
promissory note or by delivery of shares of Common Stock.

EMPLOYEE PENSION PLAN

The Company does not currently have an employee pension plan.

SECTION 16(A) REPORTING

          Under the securities laws of the United States, the Company's
directors, its executive (and certain other) officers, and any persons holding
ten percent or more of the Company's Common Stock must report on their ownership
of the Company's Common Stock and any changes in that ownership to the
Securities and Exchange Commission and to the National Association of Securities
Dealers, Inc.'s Automated Quotation System.  Specific due dates for these
reports have been established.  During the year ended December 31, 2000, the
Company does not believe that all reports required to be filed by Section 16(a)
were filed on a timely basis, if at all.

ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The following table sets forth certain information as of December 31, 2000
with respect to each beneficial owner of five percent (5%) or more of the
outstanding shares of Common Stock of the Company, each officer and director of
the Company and all officers and directors as a group. The table does not
include options that have not yet vested or are not exercisable within 60 days
of the date hereof. Unless otherwise indicated, the address of each such person
or entity is 509 Madison Avenue, New York, New York 10022.

Name and Address         Number of Shares         Percentage of
of Beneficial Owner      Beneficially Owned (1)   Common Stock
-------------------      ----------------------   ------------
Norman Grief                       -0-               0.0%

Brian Bookmeier                    -0-               0.0%

All officers and Directors as      -0-               0.0%
a group (2 persons)

----------
(1) Pursuant to the rules and regulations of the Securities and Exchange
Commission, shares of Common Stock that an individual or group has a right to
acquire within 60 days pursuant to the exercise of options or warrants are
deemed to be outstanding for the purposes of computing the percentage ownership
of such individual or group, but are not deemed to be outstanding for the
purposes of computing the percentage ownership of any other person shown in the
table.

ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     Between June 1995 and June 1996, the Company advanced an aggregate of
$184,480 to Messrs. Semhon and Bezas. Of the $184,480, $48, 130 is jointly and
Bezas, $120,750 is owed by Mr. Semhon and $15,750 is owed by Mr. Bezas. Such
advances were offset against accrued consulting fees due Messrs. Semhon and
Bezas. After such offset Mr. Semhon owes the Company $70,426 and Mr. Bezas will
not be indebted to the Company. The advance does not bear interest and has been
assigned to Scent Overnight in part payment of the Scent Note.

     In October 1997, the Company acquired all of the outstanding capital stock
of Cambridge Business Services, Inc., of which Frank DeSimone, the Company's
Executive Vice President, owned 50 percent, for a purchase price of $212,000, of
which $95,000 was paid in October 1997 and the balance was paid in February
1998.

     On September 30, 1999, Mr. Semhon agreed to convert $100,000 of debt owed
to him by the Company into shares of the Company's Series C Convertible
Preferred Stock.

     In May 2000, the Company sold its interest in the Private Label Group,
Inc., a majority-owned subsidiary, to Michael J. Assante for an aggregate
purchase price of $3,085,821, plus forgiveness of $600,000 of indebtedness owed
to Mr. Assante in connection with the Company's purchase of the Private Label
Group from Mr. Assante in August 1996.

     Except as disclosed above and pursuant to certain loan transactions with
officers, all previous transactions between the Company and its officers,
directors or 5% stockholders, and their affiliates were made on terms no less
favorable to the Company than those available from unaffiliated parties. All
future transactions between the Company and its officers, directors or 5%
stockholders, and their affiliates, will be on terms no less favorable than
could be obtained from unaffiliated third parties.
severally owed by Messrs. Semhon and


<PAGE>

ITEM 13. EXHIBITS, LISTS AND REPORTS ON FORM 8-K.

(A) EXHIBITS (NUMBERED IN ACCORDANCE WITH ITEM 601 OF REGULATION S-B).

EXHIBIT NUMBER           DESCRIPTION OF EXHIBIT
--------------           ----------------------
     27                  Financial Data Schedule



<PAGE>


                                   SIGNATURES

     In accordance with Section 13 or 15(d) of the Securities Exchange Act of
1934, the Registrant has duly caused this Annual Report on Form 10-KSB to be
signed on its behalf by the undersigned, thereunto duly authorized.


                                             AZUREL LTD.


                      Edward Adamcik         By: /s/ Edward Adamcik
                                             ----------------------
                                             Vice President, Operations

     In accordance with the Exchange Act, this report has been duly signed below
by the following persons and in the capacities and on the date indicated.

SIGNATURE                TITLE                              DATE


/S/ Edward Adamcik       Vice President, Operations         April 17, 2001
------------------
Edward Adamcik

/S/ Norman Grief         Director                           April 17, 2001
----------------
Norman Grief

/s/ Brian Bookmeier      Director                           April 17, 2001
-------------------
Brian Bookmeier