<PAGE>

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB

[X]      Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
         Exchange Act of 1934
         For the quarterly period ended September 30, 2001.

                                       OR

[ ]      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: 0-29337

                         SUMMIT BROKERAGE SERVICES, INC.
             (Exact name of registrant as specified in its charter)

           FLORIDA                                      59-3041826
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
incorporation or organization)

                                 25 FIFTH AVENUE
                           INDIATLANTIC, FLORIDA 32903
                                 (321) 724-2303

  (Address, including zip code, and telephone number, including area code, of
                   Registrant's principal executive offices)


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.

                           Yes [X]       No [ ]

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.

<TABLE>
<CAPTION>
          CLASS                              OUTSTANDING AS OF NOVEMBER 12, 2001
          -----                              -----------------------------------
<S>                                          <C>
       Common Stock
Par value $.0001 per share                                4,700,064
</TABLE>

Transitional Small Business Disclosure Format [ ] Yes [X] No
<PAGE>

                         SUMMIT BROKERAGE SERVICES, INC.

                                      INDEX

<TABLE>
<CAPTION>
                                                                                                               PAGE
                                                                                                               ----
<S>                                                                                                            <C>
PART I - FINANCIAL INFORMATION:
     Item 1. Financial Statements
         Condensed Consolidated Statements of Financial Condition at September 30, 2001                          3
         Condensed Consolidated Statements of Income (Loss) for the Nine and Three
               Months Ended September 30, 2001 and 2000                                                          4
         Condensed Consolidated Statements of Cash Flows for the Nine Months Ended
                  September 30, 2001 and 2000                                                                    6
         Notes to Financial Statements                                                                           8
       Item 2. Management's Discussion and Analysis of Financial Condition and
                        Results of Operations
                                                                                                                10
PART II - OTHER INFORMATION
     Item 1. Legal Proceedings                                                                                  12
     Item 2. Changes in Securities and Use of Proceeds                                                          12
     Item 3. Defaults Upon Senior Securities                                                                    12
     Item 4. Submissions of Matters to a Vote of Security Holders                                               12
     Item 5. Other Information                                                                                  13
     Item 6. Exhibits and Reports on Form 8-K                                                                   13
SIGNATURES
</TABLE>

                           FORWARD LOOKING STATEMENTS

         This Report contains forward-looking statements within the meaning of
Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and Section 27A of the Securities Act of 1933, as amended (the
"Securities Act"). When used in this Report, the words "may," "will," "expect,"
"anticipate," "continue," "estimate," "project" or "intend" and similar
expressions identify forward-looking statements regarding events, conditions and
financial trends in connection with our future plan of operations, business
strategy, operating results and financial position. Discussions containing such
forward-looking statements may be found in "Management's Discussion and Analysis
of Financial Condition and Results of Operations." Current shareholders and
prospective investors are cautioned that any forward-looking statements are not
guarantees of future performance. Such forward-looking statements by their
nature involve substantial risks and uncertainties, certain of which are beyond
the Company's control, and actual results for future periods could differ
materially from those discussed in this Report, depending on a variety of
important factors, among which are the success or failure of management's
efforts to implement its business strategy; the level of acquisition
opportunities available to the Company and the Company's ability to price and
negotiate such transactions on a favorable basis; the Company's ability to
properly manage growth and successfully integrate acquired companies and
operations; the Company's ability to compete with major established companies;
the Company's ability to attract and retain qualified personnel; economic and
financial market conditions generally; and other risks which may be described
from time to time in the Company's filings with the Securities and Exchange
Commission (the "SEC").


                                       2
<PAGE>

                         PART I - FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

                SUMMIT BROKERAGE SERVICES, INC. AND SUBSIDIARIES

             CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL CONDITION

                         SEPTEMBER 30, 2001 (UNAUDITED)
<TABLE>
<S>                                                                                                         <C>
ASSETS
  Cash and cash equivalents                                                                                 $    94,679
  Cash with clearing broker                                                                                      25,079
  Investments available-for-sale                                                                                 13,060
  Commissions receivable                                                                                        622,205
  Prepaid expenses                                                                                               18,992
  Other receivables, net of allowance for doubtful accounts of $14,040                                           61,962
  Due from related parties                                                                                       42,491
  Secured demand notes                                                                                           40,000
  Property and equipment at cost, less accumulated depreciation of $155,834                                     179,206
                                                                                                            -----------

                                                                                TOTAL ASSETS                $ 1,097,674
                                                                                                            ===========

                           LIABILITIES AND STOCKHOLDERS' EQUITY

LIABILITIES
  Accounts payable and accrued expenses                                                                     $    13,543
  Accrued commission expense                                                                                    416,674
  Deferred income                                                                                                64,600
  Capital lease payable                                                                                          15,080
                                                                                                            -----------
                                                                           TOTAL LIABILITIES                $   509,897

LIABILITIES SUBORDINATED TO CLAIMS OF GENERAL CREDITORS                                                     $    40,000

STOCKHOLDERS' EQUITY
  Preferred stock, 12% cumulative convertible; par value $0.0001 per
    share; authorized 5,000,000 shares; 125,000 issued and outstanding
    (liquidation preference of $125,000)                                                                             13
  Common stock, par value $0.0001 per share; authorized 20,000,000
    shares; 4,702,548 issued and 4,700,064 outstanding                                                              470
  Additional paid-in capital                                                                                  3,019,145
  Unearned stock compensation                                                                                   (28,790)
  Treasury stock, at cost                                                                                        (4,397)
  Accumulated other comprehensive income                                                                            910
  Subscriptions receivable                                                                                      (10,250)
  Accumulated deficit                                                                                        (2,429,324)
                                                                                                            -----------

                                                                  TOTAL STOCKHOLDERS' EQUITY                    547,777
                                                                                                            -----------

                                                  TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                $ 1,097,674
                                                                                                            ===========
</TABLE>


                                       3
<PAGE>

                SUMMIT BROKERAGE SERVICES, INC. AND SUBSIDIARIES

               CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS)
                         AND COMPREHENSIVE INCOME (LOSS)

<TABLE>
<CAPTION>
                                                                                           FOR THE NINE MONTHS ENDED
                                                                                                  SEPTEMBER 30,
                                                                                        -------------------------------
                                                                                           2001                2000
                                                                                        -----------         -----------
                                                                                        (UNAUDITED)         (Unaudited)
<S>                                                                                     <C>                 <C>
REVENUES
  Commissions                                                                           $ 5,478,862         $ 5,845,759
  Interest and dividends                                                                     43,238              27,724
  Other                                                                                      29,650              62,274
                                                                                        -----------         -----------
                                                                                          5,551,750           5,935,757

EXPENSES
  Commissions                                                                             4,466,706           4,688,274
  Occupancy                                                                                  86,814              86,814
  Amortization of unearned stock compensation / consultant expenses                         178,942             309,874
  Salaries and benefits                                                                     565,519             503,099
  Recruiting expense                                                                         91,135             110,346
  Legal expense                                                                              43,613              85,677
  Other operating expenses                                                                  393,004             476,018
                                                                                        -----------         -----------
                                                                                          5,825,733           6,260,102
                                                                                        -----------         -----------

                                            NET LOSS BEFORE INCOME TAXES                   (273,983)           (324,345)

PROVISION FOR INCOME TAXES                                                                       --                  --
                                                                                        -----------         -----------

                                                                NET LOSS                $  (273,983)        $  (324,345)
                                                                                        ===========         ===========

WEIGHTED AVERAGE COMMON SHARES OUTSTANDING                                                4,702,548           4,533,133
                                                                                        ===========         ===========

BASIC AND DILUTED LOSS PER SHARE                                                        $     (0.06)        $     (0.07)
                                                                                        ===========         ===========

OTHER COMPREHENSIVE LOSS, NET OF TAX
  Net loss                                                                              $  (273,983)        $  (324,345)

UNREALIZED LOSS ON SECURITIES
  Loss arising during the period
                                                                                               (865)                 --
                                                                                        -----------         -----------

                   OTHER COMPREHENSIVE LOSS
                                                                                               (865)                 --
                                                                                        -----------         -----------

                                                      COMPREHENSIVE LOSS                $  (274,848)        $  (324,345)
                                                                                        ===========         ===========
</TABLE>


                                       4
<PAGE>

                SUMMIT BROKERAGE SERVICES, INC. AND SUBSIDIARIES

               CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS)
                         AND COMPREHENSIVE INCOME (LOSS)

<TABLE>
<CAPTION>
                                                                                          FOR THE THREE MONTHS ENDED
                                                                                                 SEPTEMBER 30,
                                                                                        -------------------------------
                                                                                           2001                2000
                                                                                        -----------         -----------
                                                                                        (UNAUDITED)         (Unaudited)
<S>                                                                                     <C>                 <C>
REVENUES
   Commissions                                                                          $ 1,955,562         $ 1,475,039
   Interest and dividends                                                                    13,486              10,733
   Other                                                                                      7,849              48,553
                                                                                        -----------         -----------
                                                                                          1,976,897           1,534,325

EXPENSES
  Commissions                                                                             1,655,410           1,288,049
  Occupancy                                                                                  28,938              27,452
  Amortization of unearned stock compensation / consultant expenses                          56,074             103,878
  Salaries and benefits                                                                     163,127             177,318
  Recruiting expense                                                                         30,517              37,536
  Legal expense                                                                                 796              73,625
  Other operating expenses                                                                  164,450             184,037
                                                                                        -----------         -----------
                                                                                          2,099,312           1,891,895
                                                                                        -----------         -----------

                                            NET LOSS BEFORE INCOME TAXES                   (122,415)           (357,570)

PROVISION FOR INCOME TAXES                                                                       --                  --
                                                                                        -----------         -----------

                                                                NET LOSS                $  (122,415)        $  (357,570)
                                                                                        ===========         ===========

WEIGHTED AVERAGE COMMON SHARES OUTSTANDING                                                4,702,548           4,533,133
                                                                                        ===========         ===========

BASIC AND DILUTED LOSS PER SHARE                                                        $     (0.03)        $     (0.08)
                                                                                        ===========         ===========

OTHER COMPREHENSIVE LOSS, NET OF TAX                                                    $  (122,415)        $  (357,570)

UNREALIZED LOSS ON SECURITIES
  Loss arising during the quarter                                                                --                  --
                                                                                        -----------         -----------

                                                OTHER COMPREHENSIVE LOSS                         --                  --
                                                                                        -----------         -----------

                                                      COMPREHENSIVE LOSS                $  (122,415)        $  (357,570)
                                                                                        ===========         ===========
</TABLE>


                                       5
<PAGE>

                SUMMIT BROKERAGE SERVICES, INC. AND SUBSIDIARIES

                        CONDENSED CONSOLIDATED STATEMENTS
                                  OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                                           FOR THE NINE MONTHS ENDED
                                                                                                  SEPTEMBER 30,
                                                                                        -------------------------------
                                                                                           2001                2000
                                                                                        -----------         -----------
                                                                                        (UNAUDITED)         (Unaudited)
<S>                                                                                     <C>                 <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Cash received from customers                                                            $ 5,365,647         $ 5,405,644
Cash paid to suppliers and employees                                                     (5,583,858)         (5,787,490)
Interest received                                                                            43,238              27,724
                                                                                        -----------         -----------

                                   NET CASH USED IN OPERATING ACTIVITIES                   (174,973)           (354,122)

CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of investments                                                                          --             (14,825)
Purchase of property and equipment                                                          (94,150)            (14,845)
                                                                                        -----------         -----------

                                   NET CASH USED IN INVESTING ACTIVITIES                    (94,150)            (29,670)

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of preferred stock                                                   120,248                  --
Purchase of treasury stock                                                                       --             (85,651)
Issuance of treasury stock                                                                   25,460              27,540
Proceeds received from subscription receivable                                                   --              96,750
Payments on capital lease obligation                                                         (8,056)             (6,248)
                                                                                        -----------         -----------

                               NET CASH PROVIDED BY FINANCING ACTIVITIES                    137,652              32,391
                                                                                        -----------         -----------


                               NET DECREASE IN CASH AND CASH EQUIVALENTS                   (131,471)           (351,401)

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD                                            226,150             434,089
                                                                                        -----------         -----------

CASH AND CASH EQUIVALENTS AT END OF PERIOD                                              $    94,679         $    82,688
                                                                                        ===========         ===========
</TABLE>

*  Cash and cash equivalents at March 31, 2000 and January 1, 2000 have
   been revised to exclude cash with clearing broker consistent with the
   March 31, 2001 presentation.


                                       6
<PAGE>

                SUMMIT BROKERAGE SERVICES, INC. AND SUBSIDIARIES

           CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)


<TABLE>
<CAPTION>
                                                                                           FOR THE NINE MONTHS ENDED
                                                                                                  SEPTEMBER 30,
                                                                                        -------------------------------
                                                                                           2001                2000
                                                                                        -----------         -----------
                                                                                        (UNAUDITED)         (Unaudited)
<S>                                                                                     <C>                 <C>

RECONCILIATION OF NET LOSS TO NET CASH
    USED IN OPERATING ACTIVITIES
       Net loss                                                                         $  (273,983)        $  (324,345)
       Adjustments to reconcile net loss to net cash
          used in operating activities:
              Depreciation                                                                   23,677
                                                                                                                 31,628
              Amortization of unearned stock compensation expense                           178,942             309,874
              Change in:
                  Cash with clearing broker                                                      --
                                                                                                                     62
                  Commissions receivable                                                   (113,215)           (488,724)
                  Other receivables                                                         (17,000)
                                                                                                                (44,107)
                  Prepaid expenses                                                          (20,917)
                                                                                                                 27,788
                  Due from related party                                                    (70,140)
                                                                                                                  2,287
                  Accounts payable and accrued expenses                                      99,792
                                                                                                                (63,482)
                  Accrued commission expense                                                 86,588
                                                                                                                 36,040
                  Due to related party                                                       43,740
                                                                                                                   (200)
                  Deferred income                                                             3,333
                                                                                                                 43,267
                                                                                        -----------         -----------

                                   NET CASH USED IN OPERATING ACTIVITIES                $  (174,973)        $  (354,122)
                                                                                        ===========         ===========
</TABLE>


                                       7
<PAGE>

                SUMMIT BROKERAGE SERVICES, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

       FOR THE NINE-MONTH AND THREE-MONTH PERIODS ENDED SEPTEMBER 30, 2001

NOTE 1 -  GENERAL

         The condensed consolidated financial statements for the nine month and
three month periods ended September 30, 2001 and September 30, 2000 reflect all
adjustments (consisting only of normal recurring adjustments) which are, in the
opinion of management, necessary for a fair presentation of the financial
position and operating results for the interim period. The consolidated
financial statements should be read in conjunction with the consolidated
financial statements and notes thereto, together with management's discussion
and analysis of financial condition and results of operations, contained in the
Company's Annual Report on Form 10-KSB for the fiscal year ended December 31,
2000. The results of operations for the nine and the three month periods ended
September 30, 2001 are not necessarily indicative of the results for the entire
fiscal year ending December 31, 2001.

NOTE 2 -  DUE FROM/TO RELATED PARTIES

         At September 30, 2001, the Company has advances receivable of $39,533
from a related company for expenses paid by Summit Brokerage Services, Inc. on
the related company's behalf. Summit Brokerage Services, Inc. had a receivable
from this related party of $42,033 at June 30, 2001. During the quarter ended
September 30, 2001, $2,500 was repaid to the Company. The related company is
100% owned by a shareholder who is also the majority shareholder of Summit
Brokerage Services, Inc.

         At September 30, 2001, the Company has advances of $23,451 receivable
from an entity 100% owned by a shareholder, who is also the Company's
majority shareholder. These advances were for occupancy related (i.e., property
taxes) expenses paid by Summit Brokerage Services, Inc. on the related company's
behalf. This related company owns an office building that the Company leases.

         At June 30, 2001, the Company had $12,032 receivable from an entity
100% owned by the Company's majority shareholder. During the quarter ended
September 30, 2001, the Company paid $20,921 on behalf this related entity. The
related entity paid $54,546 to Summit Brokerage Services, Inc. during the
quarter ended September 30, 2001. The outstanding balance due to the related
entity at September 30, 2001, of $21,593, is intended to be repaid by the
Company. This related company conducts educational and training seminars, which
generate income from fees paid by the participants.

NOTE 3 -  BILLED RECEIVABLES

         On October 1, 2000, the Company entered into a placement agent
agreement with another entity. The agreement states the entity will reimburse
the Company for all costs that it paid on behalf of the entity. During the
period of January 1, 2001 to September 30, 2001, the Company incurred expenses
of $31,258 on behalf of the entity. These amounts have been billed and, as such,
are included in the statement of financial position as other receivables. The
Company considers these receivables to be fully collectible; therefore, no
allowance has been recorded.

NOTE 4 -  STOCKHOLDERS' EQUITY

         Additional paid-in capital increased by $124,990 due to the sale of
125,000 shares of Series A 12% Convertible Preferred Stock during the nine-month
period ended September 30, 2001 for $1.00 per share.

         The 125,000 shares of outstanding preferred stock as of September 30,
2001 are convertible into shares of


                                       8
<PAGE>

common stock. The number of shares of common stock which may be issued in
respect of the shares of preferred stock shall be determined by dividing (i) a
numerator equal to the number of shares of Series A 12% Convertible Preferred
Stock being converted multiplied by 115% of the subscription price, (ii) a
denominator representing the per share price that is the lower of the closing
price and the average closing sale price for the 20 trading days immediately
preceding the Series A conversion date; provided, however, in no event shall the
denominator be less than the subscription price. All such preferred stock is
non-voting stock.

         The holders of Series A 12% Convertible Preferred Stock shall be
entitled to receive, out of funds legally available for that purpose, cash
dividends at the rate of $0.12 per annum, subject to voluntary conversion. Such
dividends shall accrue and be cumulative from the issue date. Dividends shall be
payable in arrears, when and as declared by the Board of Directors, on March 31,
June 30, September 30 and December 31 of each year; provided, however, the first
dividend payment date shall not occur before the last calendar day of the first
full fiscal quarter following the issue date. Undeclared dividends in arrears as
of September 30, 2001 amounted to $4,578.

         In the event of any liquidation, dissolution or winding up of the
Company's affairs for a price per share which is less than the subscription
price set forth herein, holders of the preferred shares will be entitled to a
liquidation preference of $1.00 per preferred share, plus the dividends set
forth above, prior to any distribution to the holders of common stock in full
and complete liquidation of the interest of the holders of preferred shares. In
the event that the Company does not have sufficient funds to pay the full
liquidation preference payable to the holders of preferred shares, and any other
shares issued on a parity with the preferred shares ("Parity Shares"), the
existing funds will be allocated among the holders of all such preferred shares
and Parity Shares pro rata in proportion to the full amounts to which they would
respectively be entitled.

         At any time after August 1, 2002, the Company may, unless otherwise
prevented by law, redeem from the holder thereof, the holder's preferred shares
at the subscription price ($1.00 per share) together with any accrued but unpaid
dividends thereon to and including the date of redemption, in whole or, from
time to time, or in part. Any partial redemption shall be allocated among the
holders of preferred shares pro rata or by lot, as determined by the Company.

         On August 8, 2001, the number of authorized shares of common stock was
increased from 10,000,000 to 20,000,000 shares. In addition, in August 2001, the
Company issued to employees, officers, representatives and directors 243,016
options to purchase the Company's common stock for $1.00 per share. The options
have ten-year terms and vest over four years.


                                       9
<PAGE>

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS

         The following discussion and analysis of the Company's financial
condition and results of its operations for the three and nine month periods
ended September 30, 2001 and 2000, should be read in conjunction with the
Company's condensed consolidated financial statements included elsewhere herein.
When used in the following discussions, the words "believes," "anticipates,"
"intends," "expects," and similar expressions are intended to identify
forward-looking statements. Such statements are subject to certain risks and
uncertainties, which could cause results to differ materially from those
projected.

RESULTS OF OPERATIONS

COMPARISON OF THREE MONTHS ENDED SEPTEMBER 30, 2001 AND SEPTEMBER 30, 2000

         Revenues. Revenues for the three months ended September 30, 2001 were
$1,976,897, reflecting an increase of $442,572 (or 29%) from $1,534,325 for the
three months ended September 30, 2000. This increase was largely due to higher
revenues received from the Company's new Insurance Division, which began
operating in January 2001.

         Expenses. Expenses for the three months ended September 30, 2001
increased by $207,417 (or 11%) to $2,099,312 from $1,891,895 for the three
months ended September 30, 2000. The increase in expenses was largely
attributable to the related direct costs of revenues-commissions expense (the
payments to the registered representatives for their portion of the revenue).
Such commission expenses were $1,665,410 for the three months ended September
30, 2001, compared to $1,288,049 for the three months ended September 30, 2000.

         Net Income. Net loss for the three months ended September 30, 2001 was
$122,415, reflecting a decrease of $235,155 or (66%) from a net loss of $357,570
during the three months ended September 30, 2000. Net loss for the three months
ended September 30, 2001 was 6.2% of revenues, compared to 23.3% of revenues for
the three months ended September 30, 2000. The Company's basic and diluted loss
per share was $0.03 for the three months ended September 30, 2001, compared to
$0.08 for the three months ended September 30, 2000.

COMPARISON OF NINE MONTHS ENDED SEPTEMBER 30, 2001 AND SEPTEMBER 30, 2000

         Revenues. Revenues for the nine months ended September 30, 2001 were
$5,551,750, reflecting a decrease of $384,007 (or 6%) from $5,935,757 for the
nine months ended September 30, 2000. This decrease was due to declines in the
financial markets and public investing activities, which resulted in lower sales
commissions to the Company.

         Expenses. Expenses for the nine months ended September 30, 2001
decreased by $434,369 (or 7%) to $5,825,733 from $6,260,102 for the nine months
ended September 30, 2000. The reduction in expenses was largely attributable to
the related direct costs of revenues - commissions expense (the payments to the
registered representatives for their portion of the revenue). Such commission
expenses were $4,466,706 for the nine months ended September 30, 2001, compared
to $4,688,274 for the nine months ended September 30, 2000.

         Net Income. Net loss for the nine months ended September 30, 2001 was
$273,983, reflecting a decrease of $50,362 (or 16%) from a net loss of $324,345
during the nine months ended September 30, 2000. Net loss for the nine months
ended September 30, 2001 was 4.94% of revenues, compared to 5.46% for the nine
months ended September 30, 2000. The Company's basic loss per share was $0.06
for the nine months ended September 30, 2001, compared to per share earnings of
$0.07 for the nine months ended September 30, 2000.

LIQUIDITY AND CAPITAL RESOURCES

         Net cash used in operating activities totaled $174,973 during the nine
months ended September 30, 2001, compared to net cash used of $354,122 for the
nine months ended September 30, 2000. The decrease in cash used


                                       10
<PAGE>

by operating activities is due, in part, to the Company's net loss for the nine
months ended September 30, 2001 being smaller than the net loss for the same
period in 2000.

         Cash used in investing activities (capital expenditures) totaled
$94,150 and $29,670 during the nine months ended September 30, 2001 and 2000,
respectively. Capital expenditures were primarily comprised of the Company's
investments in securities and replacement of office computer equipment.

         Net cash provided by financing activities totaled $137,652 and $32,391
during the nine months ended September 30, 2001 and 2000, respectively. During
2001, financing activities consisted primarily of the private offering and sale
of 125,000 shares of Series A 12% Convertible Preferred Stock at $1.00 per
share, for net proceeds of $120,248.

         On September 30, 2000, the Company entered into a secured demand note
collateral agreement with a corporation 100% owned by the Company's majority
shareholder. The note is due on July 30, 2002 and accrues interest at 12% per
annum. The subordinated borrowing in the amount of $40,000 is available in
computing net capital under the SEC's uniform net capital rule. To the extent
that such borrowings are required for the Company's continued compliance with
minimum net capital requirements, it may not be repaid.

         The Company believes that its working capital levels are adequate to
meet its current requirements. However, it is anticipated that the Company will
need to raise or borrow additional funds to support its operating requirements
in the near future due to the current condition of the economy and financial
markets which have impacted the Company's revenues. There can be no assurance
that any such sources of financing would be available when needed, on
commercially reasonable terms, or at all. Also, in the normal course of
business, the Company evaluates acquisitions of businesses that compliment its
business. In connection with any acquisitions, the Company may issue additional
securities, which could result in dilution for existing shareholders.

         Inflation. Inflation has not been a major factor in the Company's
business since inception. There can be no assurances that this will continue if
and when the Company completes an acquisition or merger.


                                       11
<PAGE>

                            PART II OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

         The Company is not involved in any material legal proceedings or
litigation, and the Company is not aware of any pending litigation.

ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS

         (a)      Not applicable.

         (b)      Not applicable.

         (c)      In August 2001, the Company granted stock options to certain
of its officers, directors, employees and registered representatives to purchase
an aggregate of 243,016 shares of common stock at an exercise price of $1.00 per
share. The options are exercisable for a period of ten years and vest 20% upon
the date of grant, with the remainder vesting 20% over four years from the date
of grant. The Company is relying on the exemption provided under Section 4(2) of
the Securities Act for the issuance of these options. Information about the
Company was provided to the optionees or made available to them, along with the
opportunity to ask questions of management about the information provided or
made available.

         (d)      Not applicable.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

         Not applicable.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

         (a)      On August 4, 2001, at an Annual Meeting of Shareholders, the
following was approved:

                  (i)      The election of directors; and

                  (ii)     Amendment to the Company's Articles of Incorporation
to increase the Company's authorized common stock from 10,000,000 shares to
20,000,000 shares.

         The total number of shares entitled to vote at this meeting was
4,700,064, and the tabulation of proxies was as follows:

         ELECTION OF DIRECTORS:

<TABLE>
<CAPTION>
                                              -------------  ------------  ----------       BROKER
         NAME                                      FOR         AGAINST      ABSTAIN       NON-VOTES
         -----------------------------------  -------------  ------------  ----------  ----------------
         <S>                                  <C>            <C>           <C>         <C>
         Richard Parker                         4,536,023       1,600        19,849           0
         Harry S. Green                         4,536,023       1,600        19,849           0
</TABLE>

         The elected directors do not constitute all of the directors of the
Company. After publication of the Proxy Statement filed with the SEC and
delivered to shareholders in connection with the Annual Meeting of Shareholders
held on August 4, 2001 and prior to said Annual Meeting of Shareholders, Jack B.
Root, a director of the Company, resigned for personal reasons. At the Annual
Meeting of the Board of Directors held immediately subsequent to the Annual
Meeting of Shareholders on August 4, 2001, Lester Wilmeth, H. Lee Rust and David
Lobdell were elected to serve on the Board of Directors of the Company until the
2002 Annual Meeting of Shareholders, thereby, with Messrs. Parker and Green,
constituting the five-member Board of Directors of the Company.


                                       12
<PAGE>

<TABLE>
<CAPTION>
         AMENDMENT TO ARTICLES OF             -------------  ------------  ----------       BROKER
         INCORPORATION:                            FOR         AGAINST      ABSTAIN       NON-VOTES
         -----------------------------------  -------------  ------------  ----------  ----------------
         <S>                                  <C>            <C>           <C>         <C>
                                                4,211,030       26,054       15,913            0
</TABLE>

         No other business was brought before the Annual Meeting.

         (b)      By written consent dated June 28, 2001, the majority
shareholder of the Company who held 3,298,595 shares of the Company's then
issued and outstanding common stock, representing approximately 70.2% of the
then issued and outstanding shares, approved the reorganization of the Company's
structure into that of a holding company. The Company determined that such
reorganization was not in the Company's or the shareholders' best interests and,
therefore, did not consummate the reorganization.

ITEM 5.  OTHER INFORMATION

         Not applicable.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

(A)      EXHIBITS

<TABLE>
<CAPTION>
NUMBER            NAME
------            -------------------------------------------------------------------------------------------
<S>               <C>
3.1               Amended and Restated Articles of Incorporation (1)
3.1.1             Amendment to Amended and Restated Articles of Incorporation (1)

3.2               Amended and Restated Bylaws * (Exhibit 3.2 filed with the Company's Quarterly Report on
                  Form 10-QSB for the fiscal quarter ended June 30, 2001 was filed prematurely and
                  subsequently not adopted by the Board of Directors. As a result, the Amended and Restated
                  Bylaws dated July 21, 2000 remain in effect and are re-filed herewith.)
10.1              2000 Incentive Compensation Plan (2)
10.2              Stock Option Agreement between the Company and Richard Parker (3)
10.3              Stock Option Agreement between the Company and William R. Turner (3)
10.4              Stock Option Agreement between the Company and Mark F. Caulfield (3)
10.7              Employment Agreement between the Company and Richard Parker (4)
10.8              Employment Agreement between the Company and Mark F. Caulfield (4)
10.9              Employment Agreement between William R. Turner, and Addendum thereto (4)
10.10             Secured Demand Note Collateral Agreement between the Company and Summit Group of
                  Companies, Inc. (5)
10.11             Amendment to Secured Demand Note Collateral Agreement (5)
16.1              Letter from Hoyman, Dobson & Company, dated October 18, 2001, to the SEC (6)
21.1              Subsidiaries of the Company (7)
22.1              Proxy Statement pursuant to Schedule 14A, filed with the SEC on July 31, 2000 (2)
22.2              Information Statement pursuant to Schedule 14C, filed with the SEC on September 26, 2000 (3)
</TABLE>


                                       13
<PAGE>

------------------
* Filed herewith

(1)      Incorporated by reference to the Company's Quarterly Report on Form
         10-QSB for the fiscal quarter ended June 30, 2001, filed August 20,
         2001, file no. 000-29337.
(2)      Incorporated by reference to the Company's Proxy Statement on Schedule
         14A, filed July 31, 2000, file no. 000-29337.
(3)      Incorporated by reference to the Company's Information Statement on
         Schedule 14C, filed September 26, 2000, file no. 000-29337.
(4)      Incorporated by reference to the Company's Quarterly Report for the
         fiscal quarter ended June 30, 2000 on Form 10-QSB, filed August 14,
         2000 and amended August 15, 2000, file no. 000-29337.
(5)      Incorporated by reference to the Company's Quarterly Report for the
         fiscal quarter ended March 31, 2001 on Form 10-QSB filed May 21, 2001,
         file no. 000-29337.
(6)      Incorporated by reference to the Company's Registration Statement on
         Form 10-SB, filed February 4, 2000, file no. 000-29337.
(7)      Incorporated by reference to the Company's Amended Current Report on
         Form 8-K, filed October 18, 2001, file no. 000-29337.

(B)      REPORTS ON FORM 8-K

         On October 9, 2001, the Company filed a Current Report on Form 8-K to
report a change in the Company's certifying accountant. On October 18, 2001, the
Company filed an Amended Current Report on Form 8-K/A revising certain
information contained in its Current Report on Form 8-K filed October 9, 2001.


                                       14
<PAGE>

                         SUMMIT BROKERAGE SERVICES, INC.

                                   SIGNATURES

Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

                                        SUMMIT BROKERAGE SERVICES, INC.

Date:  November 14, 2001                /s/ Richard Parker
                                        -------------------------------------
                                        Chairman and Chief Executive
                                        Officer (Principal Executive Officer)



                                       15
<PAGE>

                                 EXHIBIT INDEX

<TABLE>
<CAPTION>
NUMBER            NAME
------            -------------------------------------------------------------------------------------------
<S>               <C>
3.2               Amended and Restated Bylaws
</TABLE>


                                       16