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CANNON SQUARE CORPORATION
2003 Annual Review
Growth
Building steadily upon the company’s growth in 2000-2002, 2003 has proved to be a dynamic year filled with successes for the myriad ventures of the Cannon Square family of companies. The successes that unfolded in the course of 2003 have made it possible to pave the way for an unprecedented period of growth for the company as it approaches its ten year anniversary in 2005. In a dramatic series of decisions reached amid rapid-fire negotiations through-out the second half of the year Cannon Square has initiated a number of sweeping changes in its organization that will be implemented beginning in January 2004.
Relocation
After nearly a decade of growth at its offices in Mystic, CT the determination was made that future investment by the company in new business relationships would require a renewed commitment to the vision of Cannon Square as a company uniquely adept at identifying opportunities for fruitful investment in the midst of ever-changing trends within the marketplace.
Restructuring
The current business environment in the company’s home state was a key factor in formulating the choice of direction for future investment. Following an advisory board meeting in August, 2003 the necessary steps to close the independent corporations developed with assistance from Cannon Square that were originally established in the state of Connecticut (Sterling Yacht Corporation and HomeArts Funding Corporation) were taken so that by year’s end all corporations as well as the Cannon Square proprietary brands (Alpha Projects, Meetings in Mystic, Gurdon Pendleton General Contracting and Zamek Productions) would be registered in the states of Maine and Pennsylvania as divisions of the parent company. In a further step towards fulfilling the company’s reorganization plan all real estate holdings were moved into a new entity, High Street Partners, LLC.
Merger
A second key element of the re-organization of Cannon Square came as a result of the particularly fruitful working relationship that has developed over the past four years from the company’s initial attempt at investment in firms located outside the company’s home state. As the outcome of extensive discussions between the parties Cannon Square Corporation is pleased to announce its merger with VirtuaLux, Inc of Philadelphia, PA.
VirtuaLux, Inc. was an internet start-up enterprise selected in 2000 to be granted funding by Cannon Square as a part of its New Leaf Investment Program. Under the New Leaf Investment Program VirtuaLux became the first independently owned company to be granted assistance. The funding package provided capital for initial expenditures, together with an intermediate term loan for working capital and a three year contract to provide marketing and IT services to the existing companies of Cannon Square.
Despite the dramatic and pervasive losses for new internet enterprises beginning in 2001 VirtuaLux was able to fulfill its commitments to Cannon Square and simultaneously develop new and profitable activities for the company that have enabled it to attain a consistent growth and return on investment.
In 2002 following completion of its full-service graphic arts, advertising, and state of the art digital recording studio, VirtuaLux, Inc expanded the scope of its operations to create, GreenArtPrints.com a fine arts publishing venture featuring fine art prints by the renowned contemporary author and artist Michael Green. With the creation of LuxMusica an internet store dedicated to promoting a variety of musical and visual artists on the internet VirtuaLux reached a new plateau in its growth.
In early 2004 Cannon Square Corporation will close its operations currently based in Mystic, Connecticut and Newport, Rhode Island to consolidate the administrative, marketing and IT functions of the company at the VirtuaLux Philadelphia location. The Cannon Square Executive Offices will move to Portland, Maine. The melding of the two companies will be coordinated by VirtuaLux co-founder, James Reilly who will continue as CEO of VirtuaLux while becoming President of Cannon Square’s Pennsylvania operations.
In addition to the effort to consolidate operations, the subsequent next phase of expansion for VirtuaLux and Cannon Square calls for the companies to partner in a non-profit venture that will build on the combined strengths of their production capabilities. The Philadelphia Society for Art, Literature & Music will be a not-for-profit organization with the mission of promoting inter-cultural expression of the creative and performing arts. PSALM will operate under the direction of a board of distinguished educators, professionals, community and religious leaders, and representatives of the arts. Several exciting projects are already underway with more in the planning stages.
Sterling Yacht Corporation
A third factor in the reorganization of Cannon Square comes as the culmination of a year-long negotiation process between Sterling Yachts and the Board of Directors of its primary client Clean Waste, Inc of Grand Cayman, C.I, BWI . In a decision reached in early May of 2003 the parties agreed to defer plans for a new round of spending on M/Y NEWS until 2005. Clean Waste, Inc. further opted to extend Sterling Yachts’ contract for management services through the period to preserve the relationship enjoyed between the two companies. The intervening period will be used to formulate an interim maintenance plan developed by Ernie Allaire, of Nautical Innovation, Inc., that will prepare the ground work for a return to full operations and an extensive refit program for the yacht beginning in the 4th quarter of 2004.
The HomeArts Companies
In a separate negotiation between HomeArts Funding Corporation (HAF) and FPj Investments of Hamden, CT an agreement to form a real estate acquisition and development enterprise between the two firms was reached. The agreement calls for FPj Investments to partner with HAF and establish an office in Portland, Maine to explore opportunities for investment in commercial, mixed use or multi-unit residential real estate properties throughout Maine. Michael Conti of HomeArts Corporation will join the project as General Manager of the new venture
Cannon Square Corporation has concluded lease negotiations with the Center for Cultural Exchange for office space located on the top floor of their building at One Longfellow Square in Portland, Maine. The new office is expected to be ready for occupation in March, 2004.
New Leaf Investment Program
Candidates currently under consideration for the company’s New Leaf Investment Program in 2004 include:
E-Board Development Corporation, a research and development company based in Chester County, Pennsylvania focusing on the development of a proprietary process for the manufacture of a new type of patented environmentally friendly building material.
The Illumination Company, which is based on Michael Green’s and Coleman Barks' visually stunning work, the best-selling, “The Illuminated Rumi “(America’s most widely read poet, Jelaluddin Rumi the 13th century Persian mystic.) and The Illumination Band which grew out of that effort. The goal is to build a bridge of meaningful dialog between the East and the West through the timeless beauty and eloquence of one of the most sympathetic figures in Islam known to the west.
X / M Management, an Import/Export start-up based in Philadelphia with extensive contacts in Istanbul and Ankara as well as other EEU member countries.
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