SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2000
Commission File No. 000-28251
SUNVEST RESORTS, INC.
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(Exact name of small business issuer as specified in its charter)
Florida 65-0693150
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(State of Incorporation) (I.R.S. Employer Identification No.)
3500 NW Boca Raton Boulevard, Building 811, Boca Raton, Florida 33431
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(Address of Principal Executive Offices)
(561) 368-0032
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(Issuer's Telephone Number, Including Area Code)
307 South 21st Avenue, Hollywood, Florida 33020
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(Former Name, Former Address and Former Fiscal Year, if
Changed Since Last Report)
Check whether the issuer (1) 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 issuer was required to file
such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No ____
APPLICABLE ONLY TO CORPORATE ISSUERS: Indicate the
number of shares outstanding of each of the issuer's classes
of common equity as of the latest practicable date.
Common stock, par value $.02 per share, 25,000,000
shares issued and outstanding as of May 12, 2000.
Transitional Small Business Disclosure Format (Check
one): Yes __ No X
PART I
FINANCIAL INFORMATION
Item 1. Financial Statements
SUNVEST RESORTS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS - MARCH 31, 2000 & 1999
ASSETS
2000 1999
---- ----
Cash and Equivalents $ 284,316 $ 533,653
Mortgage notes receivable 1,838,927 1,244,622
Condominium units held for sale 3,286,078 3,126,061
Condominium units under development 1,454,200 1,298,200
Income producing property 4,547,691 4,730,285
Land held for future development 1,842,500 1,828,396
Deferred costs 260,763 380,943
Deferred tax asset 9,630 403,100
Due from affiliates 51,259 412,963
Other 13,220 4,700
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$13,568,584 $13,962,923
=========== ===========
LIABILITIES AND SHAREHOLDERS' DEFICIT
Liabilities
Notes and mortgages payable $12,438,450 $11,048,746
Accounts payable and accrued liabilities 969,408 1,296,287
Deposit on sales contracts 44,006 203,315
Due to condominium associations 13,354 0
Advances from shareholders 874,088 874,444
Due to related parties 1,780,984 1,201,038
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16,120,288 14,623,828
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Monthly interest 48,500 114,900
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Shareholders' deficit
Common stock, $.02 par, authorized
25,000,000 shares; issued and
outstanding 9,000,000 and 8,877,532 180,000 177,500
shares in 2000 and 1999
Capital in excess of par 699,600 579,600
Accumulated deficit (3,479,804) (1,532,905)
(2,600,204) (775,805)
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$13,568,584 $13,962,923
=========== ===========
SUNVEST RESORTS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
THREE MONTHS ENDED MARCH 31, 2000 & 1999
2000 1999
---- ----
Revenues:
Condominium units $159,468 $654,906
Timeshare units 122,320 27,950
Rents 361,877 426,602
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643,665 1,109,486
Cost of sales:
Condominium units 40,100 328,461
Timeshare units 45,000 10,000
Rents 173,657 221,833
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258,757 560,284
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384,908 549,174
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Operating expenses:
Advertising 27,568 41,230
Selling and promotion 151,187 31,237
General and administrative 229,325 173,955
Depreciation and amortization 44,000 61,200
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452,080 307,622
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Income before other income (expenses) (67,172) 241,552
and income taxes ------- -------
Other income (expenses)
Interest income 2,298 7,602
Other 887,989 51,400
Interest expense (279,919) (190,459)
-------- -------
610,368 (131,457)
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Income before minority interest 543,196 110,095
and income taxes
Minority interest 0 0
Income before income tax 543,196 110,095
expense (benefit)
Income tax expense (benefit) 200,000 44,000
-------- ------
Net income 343,196 66,095
======== ======
Income per share of common
stock:
Basic $0.04 $0.01
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Diluted $0.04 $0.01
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SUNVEST RESORTS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
THREE MONTHS ENDED MARCH 31, 2000 & 1999
2000 1999
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) $343,196 $66,095
ADJUSTMENT TO RECONCILE NET INCOME
(LOSS) TO NET CASH PROVIDED BY
OPERATING ACTIVITIES
(Increase) decrease in assets:
Deposits 35,300 43,900
Mortgage notes receivable (1,235,527) (148,522)
Project costs, property and land 505,831 (832,342)
Deferred assets (57,863) (67,943)
Other 32,491 (99,263)
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Cash used (719,768) (1,104,170)
Increase (decrease) in liabilities:
Notes and mortgages payable 183,250 (249,454)
Accounts payable (105,494) 706,287
Deposits (28,294) 141,915
Due to condominium associations (20,946) (56,300)
Advances 551,172 53,980
Cash provided 579,688 596,428
-------- ------
Cash (used) provided by operating 203,116 (441,647)
activities
NET INCREASE (DECREASE) IN CASH 203,116 (441,647)
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CASH - BEGINNING 9,200 852,800
------- -------
CASH - ENDING $212,316 $411,153
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SUNVEST RESORTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
THREE MONTHS ENDED MARCH 31, 2000 AND 1999
Basis of Presentation:
The accompanying unaudited consolidated financial
statements have been prepared in accordance with generally
accepted accounting principles for the interim financial
information and with the instructions to Form 10-QSB.
Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting
principles for complete financial statements. In the
opinion of management, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair
presentation have been included. Operating results for the
three-month period ended March 31, 2000, are not necessarily
indicative of the results that may be expected for the year
ended December 31, 2000. For further information, refer to
the consolidated financial statements and footnotes thereto
included in the Company's Annual Report on Form 10-KSB for
the year ended December 31, 1999.
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
Net income for the quarter ended March 31, 2000, was
$343,196 (or $.04 per share), compared to net income of
$66,095 (or $.01 per share) for the quarter ended March 31,
1999. This increase has occured in spite of a 42% (from
$1,109,458 to $643,665) decrease in revenues and a 47% (from
$307,622 to $452,080) increase in operating expenses in the
first quarter of 2000 compared to the first quarter of 1999,
and is attributable to the extraordinary item of other
income of $887,989, which was generated from the sale of land
and the front desk rental operation at the Colony Plaza project.
The decrease in revenue was attributable to a reduction
in available inventory of condominium units at the Colony
Plaza and Pirates Cove projects. The increase in operating
expenses was primarily attributable to a 484% (from $31,237
to $151,187) increase in selling and promotional expenses.
This increase was due to an intense marketing effort to sell
units at the Lakeshore Club project carried out by the
Company during the first quarter of 2000.
PART II
OTHER INFORMATION
Item 1. Legal Proceedings.
There are no material pending legal proceedings to
which the Registrant or any of its property is the subject.
Item 2. Changes in Securities.
(a) None.
(b) None.
Item 3. Defaults Upon Senior Securities.
None.
Item 4. Submission of Matters to a Vote of Security Holders.
None.
Item 5. Other Information.
During late April 2000, the Company underwent a
fundamental transformation. Specifically:
1. On April 21, 2000, Colony Plaza Development, Inc., a
wholly-owned subsidiary of the Company, merged into Cove
Development, Inc., another wholly-owned subsidiary of the
Company ("Cove"). On April 25, 2000, the Company
distributed all of its assets, consisting of 9,000,000
shares of the common stock of Cove and 9,000,000 membership
Units in Lakeshore Club Development, L.C., a Florida limited
liability company wholly-owned by the Company, to all the
shareholders pro-rata as a special dividend.
2. On April 25, 2000, the current directors and officers
of the Company resigned and elected (a) as directors, five
individuals who then served as the directors of US Data
Authority, Inc. ("USDA"), a Florida corporation engaged in
an Internet-related business (see below) and (b) as officers
the then corresponding officers, of USDA.
3. On April 28, 2000, the Common Stock underwent a 3.6:1
reverse stock split, whereby the 9,000,000 shares
outstanding turned into 2,500,000 shares outstanding. As a
result, the Company's trading symbol on the OTC Bulletin
Board was changed from "SUNE" to "SUNED."
4. Effective May 1, 2000, with the Company having
essentially no assets or liabilities, USDA merged with and
into the Company (the "Merger"), the shareholders of USDA
receiving in the merger approximately 22,500,000 new post-
reverse stock split shares of the Common Stock, or
approximately 90% of the equity of the Company.
USDA is a Total Solutions Provider (TSP)
headquartered in Boca Raton, Florida. For its first fiscal
year of operations, the year ended December 31, 1999 (11
months), USDA had audited pre-tax earnings of $178,066 on
net sales of $441,436. Prior to the merger with the Company,
in late April, USDA completed a $2.4 million private
placement.
USDA offers an integrated communications service
built on a unique hybrid network of AT&T and Cable &Wireless
backbones. These leading fiber networks offer an award-
winning Internet protocol backbone. They deliver a coast-to-
coast fiber optic system using AT&T's premier integration,
which contains the largest closed circuit network with
100,000 miles of redundant fiber nationwide, and Cable and
Wireless's superior Internet backbone. The Asynchronous
Transfer Mode (ATM) backbone links information using USDA's
national network of 40 Network Access Points (NAP) located
around North America. These NAP's offer superior redundancy
and diverse routing technology, the keys to successful
Internet, Extranet and Intranet communications.
Furthermore, USDA's network runs on AT&T's SONET
(Synchronous Optical NETwork) architecture, using bi-
directional configuration to reroute traffic in
milliseconds. If a fiber cut does occur, data is
automatically redirected, greatly enhancing reliability.
USDA's services include Internet access, co-
location and remote access. USDA's customers are
businesses, including Applications Service Providers,
Internet Service Providers and telecommunication firms.
Item 6. Exhibits and Reports on Form 8-K.
A. Exhibits:
27 Financial Data Schedule
B. Reports on Form 8-K
Registrant filed no reports on Form 8-K during the
quarter ended March 31, 2000.
SIGNATURES
Pursuant to the requirements of the Securities Exchange
Act of 1934, the Registrant has duly caused this report to
be signed on its behalf by the undersigned thereunto duly
authorized.
SUNVEST RESORTS, INC.
Date: May 12, 2000 BY: /S/ Dominick F. Maggio
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Dominick F. Maggio
President, Principal Executive, Financial and
Accounting Officer
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