U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(Mark One)
[x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 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 Number
BILTMORE VACATION RESORTS INC.
--------------------------------------------------------------------------------
(Exact name of small business issuer as specified in its charter)
Utah 88-0355447
State or other jurisdiction (IRS Employer
of incorporation or organization) Identification No.)
2110 E FLAMINGO RD STE. 110, LAS VEGAS, NV 89119
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(Address of principal executive offices)
702-650-2889
------------
(Issuer's telephone number)
Not Applicable
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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 Exchange Act of 1934 during the past 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
----- -----
As of September 30, 2000, the Company had 4,846,756 shares of its $.001 par
value common stock issued and outstanding.
Transitional Small Business Disclosure Format (check one):
Yes No X
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<PAGE>
INDEX
PART I FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Balance
Sheet at September 30, 2000 (unaudited)
Condensed Consolidated Statements of Operations
for the Quarter Ended September 30, 2000
and September 30, 1999 (unaudited)
Condensed Consolidated Statements of Operations
for the Nine Months Ended September 30, 2000
and September 30, 1999 (unaudited)
Condensed Consolidated Statements of Cash Flows
for the Nine Months Ended September 30, 2000
and September 30, 1999 (unaudited)
Notes to Condensed Consolidated
Financial Statements (unaudited)
Item 2. Management's Discussion and Analysis or Plan of Operations
PART II OTHER INFORMATION
Item 1. Legal Proceedings
Item 2. Changes in Securities
Item 3. Defaults Upon Senior Securities
Item 4. Submission of Matters to a Vote of Security Holders
Item 5. Other Information
Item 6. Exhibits and Reports on Form 8-K
Signatures
<PAGE>
<TABLE>
BILTMORE VACATION RESORTS, INC. AND SUBSIDIARIES
(A DEVELOPMENT STAGE COMPANY)
Condensed Consolidated Balance Sheet
(Unaudited)
<CAPTION>
September 30, 2000
------------
<S> <C>
ASSETS
Real estate projects $ 7,428,344
Cash 24,749
Property and equipment 240,538
Other 1,010
------------
$ 7,694,641
============
LIABILITIES AND SHAREHOLDERS' EQUITY
Notes payable $ 3,108,536
Due to affiliate 550,000
Accounts payable 508,387
Accrued liabilities 195,217
------------
Total liabilities 4,362,140
------------
Commitments and contingencies -
Shareholders' equity:
Common stock 4,847
Additional paid-in capital 5,678,939
Deficit accumulated during the development stage (2,351,285)
------------
Total shareholders' equity 3,332,501
------------
$ 7,694,641
============
</TABLE>
<PAGE>
BILTMORE VACATION RESORTS, INC. AND SUBSIDIARIES
(A DEVELOPMENT STAGE COMPANY)
Condensed Consolidated Statements of Operations
(Unaudited)
THREE MONTHS ENDED SEPTEMBER 30,
--------------------------------
2000 1999
------------ ------------
General and administrative $ 149,887 $ 96,661
------------ ------------
OPERATING LOSS (149,887) (96,661)
Interest expense (19,873) (3,497)
------------ ------------
NET LOSS $ (169,760) $ (100,158)
============ ============
BASIC AND DILUTED NET
LOSS PER SHARE $ (0.04) $ (0.03)
============ ============
BASIC AND DILUTED WEIGHTED
AVERAGE COMMON SHARES 4,440,215 3,933,231
============ ============
<PAGE>
<TABLE>
BILTMORE VACATION RESORTS, INC. AND SUBSIDIARIES
(A DEVELOPMENT STAGE COMPANY)
Condensed Consolidated Statements of Operations
(Unaudited)
CUMULATIVE
NINE MONTHS ENDED SEPTEMBER 30, FROM INCEPTION
---------------------------- (FEBRUARY 28, 1998)
2000 1999 TO SEPTEMBER 30, 2000
------------ ------------ ------------
<S> <C> <C> <C>
General and administrative $ 687,584 $ 305,191 $ 2,298,699
------------ ------------ ------------
OPERATING LOSS (687,584) (305,191) (2,298,699)
Interest expense (28,418) (2,238) (52,586)
------------ ------------ ------------
NET LOSS $ (716,002) $ (307,429) $(2,351,285)
============ ============ ============
BASIC AND DILUTED NET
LOSS PER SHARE $ (0.16) $ (0.08)
============ ============
BASIC AND DILUTED WEIGHTED
AVERAGE COMMON SHARES 4,374,064 3,918,891
============ ============
</TABLE>
<PAGE>
<TABLE>
BILTMORE VACATION RESORTS, INC. AND SUBSIDIARIES
(A DEVELOPMENT STAGE COMPANY)
Condensed Consolidated Statements of Cash Flows
(Unaudited)
<CAPTION>
CUMULATIVE
NINE MONTHS ENDED SEPTEMBER 30, FROM INCEPTION
---------------------------- (FEBRUARY 28, 1998)
2000 1999 TO SEPTEMBER 30, 2000
------------ ------------ ------------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (716,002) $ (307,429) $(2,351,285)
Adjustments to reconcile net income to
net cash used by operating activities:
Amortization of stock compensation - 200,000 230,000
Depreciation and amortization 52,211 110,090 147,128
Common stock issued as compensation - - 1,213,622
Common stock issued in lieu of financing fees 15,767 - 650,142
Increase in real estate projects (1,685,670) (1,796,779) (6,084,044)
(Increase) decrease in other assets 34,867 (2,020) 7,389
Increase in accounts payable 407,047 - 508,387
Increase (decrease) in accrued liabilities 53,936 (19,660) 195,218
------------ ------------ ------------
Net cash used by operating activities (1,837,844) (1,815,798) (5,483,443)
------------ ------------ ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of equipment (13,805) (136,987) (325,450)
------------ ------------ ------------
Net cash used by investing activities (13,805) (136,987) (325,450)
------------ ------------ ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock 1,325,547 1,471,440 3,464,034
Cash contributed at inception - - 11,072
Proceeds from notes payable 384,536 1,230,654 3,308,536
Payments on notes payable - (50,000) (200,000)
Reduction in due to affiliate - (750,000) (750,000)
------------ ------------ ------------
Net cash provided by financing activities 1,710,083 1,902,094 5,833,642
------------ ------------ ------------
Net (decrease) increase in cash (141,566) (50,691) 24,749
CASH, BEGINNING OF PERIOD 166,315 158,680 -
------------ ------------ ------------
CASH, END OF PERIOD $ 24,749 $ 107,989 $ 24,749
============ ============ ============
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Interest paid, net of amounts capitalized $ 28,418 $ 19,238 $ 52,586
============ ============ ============
NON-CASH INVESTING AND FINANCING ACTIVITIES:
Real estate contributed $ - $ - $ 1,344,300
Assumption of amounts due to affiliate - - (1,300,000)
Other assets contributed, -
including $11,073 in cash - - 81,689
------------ ------------ ------------
Common stock issued for net
assets contributed at inception $ - $ - $ 125,989
============ ============ ============
Repayment of affiliate advances with
common stock $ 663,997 $ 1,451,287 $ 2,762,983
============ ============ ============
</TABLE>
<PAGE>
BILTMORE VACATION RESORTS, INC. AND SUBSIDIARIES
(A DEVELOPMENT STAGE COMPANY)
Notes to Condensed Consolidated Financial Statements
September 30, 2000
(Unaudited)
1. BACKGROUND AND BASIS OF PRESENTATION
------------------------------------------
On February 28, 1998, Biltmore Vacation Village, Inc. ("BVVI"), a
diversified real estate company owned by George Wuagneux, contributed one
of its projects (the "Bullhead Property") and related debt, at BVVI's
basis, to a newly formed entity, Biltmore Vacation Resorts, Inc. ("BVRI"),
a Nevada corporation, to be developed as a time share resort. Also on
February 28, 1998, BVRI acquired control of Cyber Information, Inc.
("Cyber"), an inactive public shell with no assets or liabilities, in a
reverse merger transaction. For accounting purposes, the combination is
treated as a recapitalization of BVRI.
The accompanying consolidated financial statements include the accounts of
BVRI and its wholly owned subsidiaries, Biltmore Vacations, LLC, St.
Tropez Vacations, LLC, Nevada Realty and Management, Inc., Sage Design
Builders, Inc. and Dynamic Design Architecture, LLC (collectively, the
"Company"). Although Dynamic Design Architecture, LLC is only 30% owned by
Sage Design Builders, Inc., the majority owner has contractually placed
all power and day-to-day decisions in the hands of Sage Design Builders,
Inc. Further, the majority owner is not required to make good on any
losses and has agreed that any future profits up to $5,000,000 will accrue
entirely to Sage Design Builders, Inc.'s benefit. All material
intercompany transactions and accounts have been eliminated in
consolidation.
The Company is classified as a development stage company because its
principal activities involve obtaining the capital necessary to execute
its strategic business plan.
Interim periods
---------------
The accompanying unaudited condensed consolidated financial statements do
not include all of the information required by generally accepted
accounting principles for complete financial statements. In the opinion of
the Company's management, all necessary adjustments (consisting of normal
recurring adjustments) for a fair presentation have been included.
Operating results for the three and nine month periods ended September 30,
2000, are not necessarily indicative of results for any future period.
These statements should be read in conjunction with the consolidated
financial statements and notes thereto for the year ended December 31,
1999 included in the Company's Form 10-SB.
Real estate property under development
--------------------------------------
Real estate projects are stated at the lower of cost or net realizable
value. Project costs include the cost of the land and land improvements,
engineering and design, construction materials, direct labor and overhead
and interest, taxes and other carrying costs incurred during the
construction period.
<PAGE>
BILTMORE VACATION RESORTS, INC. AND SUBSIDIARIES
(A DEVELOPMENT STAGE COMPANY)
Notes to Condensed Consolidated Financial Statements
September 30, 2000
(Unaudited)
Shareholders' equity
--------------------
The majority shareholder and president of the Company has advanced funds
to the Company. The advanced funds have been periodically converted into
common shares at the current market price. Conversions were as follows:
Number of Amount of
Date Shares consideration
-------------------- ------------ -----------------
June 30, 2000 14,824 $ 111,177
September 30, 2000 440,656 $ 550,820
2. CONTINGENCIES
-------------------
Litigation
----------
From time to time the Company is a party to various lawsuits and claims
which have arisen in the normal course of its business. While it is not
possible to predict with certainty the outcome of such litigation and
claims, it is the opinion of Company management, based in part on
consultations with counsel, that the liability of the Company, if any,
arising from the ultimate disposition of any or all such lawsuits and
claims is not material to the consolidated financial statements of the
Company.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS OR PLAN OF OPERATIONS
THE FOLLOWING DISCUSSION OF OUR FINANCIAL CONDITION AND RESULTS OF
OPERATIONS SHOULD BE READ IN CONJUNCTION WITH THE FINANCIAL STATEMENTS AND NOTE
1. TO THE FINANCIAL STATEMENTS INCLUDED ABOVE. SUCH DISCUSSION CONTAINS
FORWARD-LOOKING STATEMENTS THAT RELATE TO FUTURE EVENTS OR THE COMPANY'S FUTURE
FINANCIAL PERFORMANCE AND INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTANITIES AND
OTHER FACTORS THAT MAY CAUSE THE COMPANY'S OR THE INDUSTRY'S ACTUAL RESULTS,
LEVELS OF ACTIVITY, PERFORMANCE OR ACHIEVEMENTS TO BE MATERIALLY DIFFERENT FROM
ANY FUTURE RESULTS, LEVELS OF ACTIVITY, PERFORMANCE OR ACHIEVEMENTS EXPRESSED OR
IMPLIED BY THESE FORWARD-LOOKING STATEMENTS.
PLAN OF OPERATIONS
The Company has begun development of its timeshare resort project in
Bullhead City, Arizona, and is completing the acquisition of the St. Tropez
Hotel in Las Vegas, Nevada, for renovation and conversion into a timeshare
project. The Company has obtained a loan commitment from M.K.D. Capital Corp. of
approximately $41,500,000 to purchase the hotel property, and pay the renovation
and construction costs for the first phase of the project. Closing of that loan
was originally to take place on June 2, 2000 but did not take place as scheduled
because of delays occasioned by the lender's failure to timely fulfill its
commitment.
The Company is currently in negotiations with various banking and other
financial institutions , as well as private parties to obtain additional debt
and equity financing to continue development of the Bullhead City project and to
pay for the subsequent phase of development for the St. Tropez project.
LIQUIDITY AND CAPITAL RESOURCES
During the three months ended September, 30, 2000, the Company obtained a loan
of $550,820 from its President and CEO, George Waugeux and another related
party. These loans were repaid through the issuance of 440,656 common shares.
Net cash used in operating activities was $1,837,844 for the nine months ended
September 30, 2000. Net cash provided by financing activities was $1,710,083 for
the nine months ended September 30, 2000, primarily attributable to proceeds
from issuance of common stock and notes payable.
The Company's continued operating losses, limited capital and operating
requirements raise substantial doubt about its ability to continue as a going
concern. The Company's year end audited financial statements include a going
concern modified opinion.
<PAGE>
PART II OTHER INFORMATION
Item 1. Legal Proceedings
There are no legal proceedings against the Company and the Company is
unaware of proceedings contemplated against it.
Item 2. Changes in Securities
During the period from June 30, 2000 to the date of this filing, the
Company issued 440,656 shares of common stock to Biltmore Vacation Village, Inc.
for conversion of debt totaling $550,820. In addition, the Company sold 35,219
common shares for $127,494.
The Company intends to finance future activities by (1) obtaining
equity financing through the sale of its stock; (2) obtaining construction loans
and lines of credit from financing institutions to fund construction and
development of its Bullhead City and St. Tropez projects; and (3) selling
vacation ownership units in the projects and using the proceeds to repay the
construction financing.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Submission of Matters to a Vote of Security Holders
No matters were submitted to the security holders for a vote.
Item 5. Other Information
There is no other information deemed material by management for
disclosure herein.
Item 6. Exhibits and Reports on Form 8-K
Exhibits
--------
27 Financial Data Schedule
Reports on Form 8-K
-------------------
Inapplicable
<PAGE>
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
BILTMORE VACATION RESORTS INC
By: /s/ George Waugeux
--------------------
George Waugeux
Director and President
Dated: November 20, 2000
