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EXCEL - IDEA: XBRL DOCUMENT - SUNVESTA, INC. | Financial_Report.xls |
EX-32 - CERTIFICATION - SUNVESTA, INC. | exhibit32.htm |
EX-31 - CERTIFICATION - SUNVESTA, INC. | exhibit31.htm |
EX-10.10 - DEBT SETTLEMENT - SUNVESTA, INC. | exhibit1010.htm |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
þ
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2012.
o
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: 000-28731
SUNVESTA, INC.
(Exact name of registrant as specified in its charter)
Florida
98-0211356
(State or other jurisdiction of
(I.R.S. Employer
incorporation or organization)
Identification No.)
Seestrasse 97, Oberrieden, Switzerland CH-8942
(Address of principal executive offices) (Zip Code)
011 41 43 388 40 60
(Registrants telephone number, including area code)
n/a
(Former name, former address and former fiscal year, if changed since last report)
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 o No þ
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web
site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation
S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant
was required to submit and post such files). Yes þ No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated
filer, or a smaller reporting company. See the definitions of large accelerated filer, accelerated filer and
smaller reporting company in Rule 12b-2 of the Exchange Act.
Large accelerated filer o Accelerated filer o Non-accelerated filer o Smaller reporting company þ
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange
Act). Yes o No þ
Indicate the number of shares outstanding of each of the issuers classes of common stock, as of the latest
practicable date. The number of shares outstanding of the issuers common stock, $0.01 par value (the only
class of voting stock), at April 15, 2013, was 75,041,603.
1
TABLE OF CONTENTS
PART 1- FINANCIAL INFORMATION
Item1.
3
Consolidated Balance Sheets as of March 31, 2012 (Unaudited) and December 31,
4
2011
Unaudited Consolidated Statements of Operations and Comprehensive Loss for the
5
three months ended March 31, 2012 and March 31, 2011 and cumulative amounts
Unaudited Consolidated Statements of Stockholders Equity (Deficit)
6
Unaudited Consolidated Statements of Cash Flows for the three months ended
7
March 31, 2012 and March 31, 2011 and cumulative amounts
Notes to Unaudited Consolidated Financial Statements
8
Item 2.
Managements Discussion and Analysis of Financial Condition and Results of
24
Operations
Item 3.
Quantitative and Qualitative Disclosures about Market Risk
33
Item 4.
Controls and Procedures
34
PART II-OTHER INFORMATION
Item 1.
35
Item 1A.
35
Item 2.
Unregistered Sales of Equity Securities and Use of Proceeds
35
Item 3.
Defaults Upon Senior Securities
35
Item 4.
Mine Safety Disclosures
35
Item 5.
Other Information
35
Item 6.
35
36
Index to Exhibits
37
2
PART I FINANCIAL INFORMATION
ITEM 1.
FINANCIAL STATEMENTS
As used herein, the terms Company, we, our, and us refer to SunVesta, Inc., a Florida
corporation, and its predecessors and subsidiaries, unless otherwise indicated. In the opinion of
management, the accompanying unaudited, consolidated financial statements included in this Form 10-Q
reflect all adjustments (consisting only of normal recurring accruals) necessary for a fair presentation of
the results of operations for the periods presented. The results of operations for the periods presented are
not necessarily indicative of the results to be expected for the full year.
3
SUNVESTA, INC.
(A Development Stage Company)
CONSOLIDATED BALANCE SHEETS
March 31, 2012
December 31, 2011
Assets
(Unaudited)
Current assets
Cash and cash equivalents
$
184,613
505,500
Short term investments
0
75,000
Other assets
21,901
7,775
Receivables from related parties
554,705
443,499
Total current assets
761,219
1,031,774
Non-current assets
Property and equipment - net
12,370,324
11,390,280
Debt issuance cost - net
1,751,540
1,511,759
Down payment for property and equipment
4,400,140
3,100,057
Others
249,135
241,500
Receivables from related parties
613,260
0
Total non-current assets
19,384,399
16,243,596
Total assets
$
20,145,618
17,275,370
Liabilities and stockholders' equity (deficit)
Current liabilities
Accounts payable
$
1,440,242
1,401,137
Accrued expenses
2,486,326
2,421,864
Notes payable to related parties
1,039,308
94,315
Total current liabilities
4,965,876
3,917,316
Non-current liabilities
EUR-Bond
10,517,908
9,598,537
CHF-Bond
5,454,430
3,818,898
Notes payable to related parties
4,584,159
3,192,848
Pension liabilities
63,115
50,341
Total non-current liabilities
20,619,612
16,660,624
Total liabilities
$
25,585,488
20,577,940
Stockholders' equity (deficit)
Preferred stock, $0.01 par value;
50,000,000 share authorized
no shares issued and outstanding
-
-
Common stock, $0.01 par value;
200,000,000 share authorized;
54,092,186 shares issued and outstanding
$
540,922
540,922
Additional paid-in capital
18,728,391
18,728,391
Accumulated other comprehensive loss
(840,652)
(37,877)
Retained earnings prior to development stage
1,602
1,602
Deficit accumulated during the development stage
(23,846,378)
(22,511,853)
Treasury stock, 157,220 and 157,220 shares
(23,755)
(23,755)
Total stockholders' equity (deficit)
(5,439,870)
(3,302,570)
Total liabilities and stockholders' equity (deficit)
$
20,145,618
17,275,370
The accompanying notes are an integral part of these consolidated financial statements.
4
SUNVESTA, INC.
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
Three months
Cumulative*
ended March 31,
Amounts
2012
2011
(Unaudited)
(Unaudited)
(Unaudited)
Revenues
Revenues, net
$
-
-
-
Cost of revenues
-
-
-
Gross profit
-
-
-
Operating expenses
General and administrative expenses
$
(971,627)
(438,018)
(17,713,869)
Sales and marketing
-
(5,984)
(480,872)
Impairment on property and equipment
-
0
(1,311,000)
Total operating expenses
$
(971,627)
(444,002)
(19,505,741)
Loss from operations
$
(971,627)
(444,002)
(19,505,741)
Other income / - expenses
Loss on disposals of assets
$
-
-
(3,258)
Loss on sale of investments
-
-
(1,137,158)
Loss on extinguishment of debt
-
-
(1,806,758)
Interest income
3,060
-
69,941
Interest expense
(280,995)
(33,626)
(1,244,841)
Amortization of debt issuance cost and
commissions
(229,288)
-
(604,658)
Exchange differences
130,272
-
299,508
Other income / - expenses
14,053
-
86,588
Total other income / - expenses
$
(362,898)
(33,626)
(4,340,636)
Loss before income taxes
$ (1,334,525)
(477,628)
(23,846,377)
Income taxes
-
-
-
Net loss
$ (1,334,525)
(477,628)
(23,846,377)
Comprehensive loss:
Foreign currency translation
(802,775)
(83,074)
(819,652)
Comprehensive loss
$
(2,137,300)
(560,702)
(24,666,030)
Loss per common share
Basic and diluted
$
(0.02)
(0.01)
Weighted average common shares
Basic and diluted
54,092,186
54,092,186
* Cumulative: January 1, 2005 (date of inception) to March 31, 2012
The accompanying notes are an integral part of these consolidated financial statements.
5
SUNVESTA, INC.
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
January 1, 2005 (Date of Inception) to March 31, 2012
Common
Additional Paid
Accumulated
Prior Earnings
Deficit Accumulated
Treasury Stock
Total
Stock
in Capital
Other
During Development
Stockholders
Comprehensive
Stage
Equity (Deficit)
Income (Loss)
January 1, 2005
$
210,000 $
281,521 $
128 $
1,602 $
- $
-
$
493,251
Net loss
-
-
-
-
(807,118)
-
(807,118)
Translation adjustments
-
-
23,149
-
-
-
23,149
December 31, 2005
210,000
281,521
23,277
1,602
(807,118)
-
(290,718)
Net loss
-
-
-
-
(3,575,713)
-
(3,575,713)
Translation adjustments
-
-
(163,151)
-
-
-
(163,151)
December 31, 2006
210,000
281,521
(139,874)
1,602
(4,382,831)
-
(4,029,582)
Net loss
-
-
-
-
(2,912,578)
-
(2,912,578)
Translation adjustments
-
-
35,580
-
-
-
35,580
Acquisition of OpenLimit, Inc.
14,000
(63,080)
-
-
-
-
(49,080)
Issuance of stock for debt
64,312
10,742,025
-
-
-
-
10,806,337
December 31, 2007
288,312
10,960,466
(104,294)
1,602
(7,295,409)
-
3,850,677
Net loss
-
-
-
-
(1,188,377)
-
(1,188,377
Translation adjustments
-
-
(367,601)
-
-
-
(367,601)
Issuance of stock for compensation
417
61,852
-
-
-
-
62,269
Issuance of stock for debt
18,182
2,709,091
-
-
-
-
2,727,273
December 31, 2008
306,911
13,731,409
(471,895)
1,602
(8,483,786)
-
5,084,241
Net loss
-
-
-
-
(2,471,845)
-
(2,471,845)
Translation adjustments
-
-
401,460
-
-
-
401,460
Issuance of stock for compensation
600
44,400
-
-
-
-
45,000
Issuance of stock for cash
10,000
290,000
-
-
-
-
300,000
Issuance of stock for debt
77,259
3,785,668
-
-
-
-
3,862,927
Purchase of treasury stock
-
-
-
-
-
(12,200)
(12,200)
December 31, 2009
394,770
17,851,477
(70,435))
1,602
(10,955,631)
(12,200)
7,209,583
Net loss
-
-
-
-
(1,173,292)
-
(1,173,292)
Translation adjustments
-
-
10,983
-
-
-
10,983
Issuance of stock for debt
146,152
876,914
-
-
-
-
1,023,066
Purchase of treasury stock
-
-
-
-
-
(11,555)
(11,555)
December 31, 2010
540,922
18,728,391
(59,452)
1,602
(12,128,923)
(23,755)
7,058,785
Net loss
-
-
-
-
(10,382,930)
-
(10,382,930)
Translation adjustments
-
-
21,575
-
-
-
21,575
December 31, 2011
$
540,922 $
18,728,391 $
(37,877) $
1,602 $
(22,511,853) $
(23,755)
$
(3,302,570)
Net loss
-
-
-
-
(1,334,525)
-
(1,334,525)
Translation adjustments
-
-
(802,775)
-
-
-
(802,775)
March 31, 2012
$
540,922 $
18,728,391 $
(840,652) $
1,602 $
(23,846,378) $
(23,755)
$
(5,439,870)
The accompanying notes are an integral part of these consolidated financial statements.
6
SUNVESTA, INC.
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF CASH FLOWS
January 1 to
January 1 to
Cumulative *
March 31, 2012
March 31, 2011
Amounts
(Unaudited)
(Unaudited)
(Unaudited)
Cash flows from operating activities
Net loss
$
(1,334,525)
(477,628)
(23,846,377)
Adjustments to reconcile net loss to net cash
Depreciation and amortization
22,443
689
311,178
Amortization of debt issuance cost and commissions
229,288
19,383
612,357
Unrealized exchange differences
(130,272)
-
(299,508)
Impairment of property and equipment
-
-
1,311,000
Other income / expenses
(60,701)
-
(60,701)
Stock compensation expense
-
-
107,269
Loss on securities acquired as deposit on stock
-
-
1,008,324
Loss on disposal of assets
-
-
3,258
Loss on extinguishment of debt
-
-
1,806,758
Increase in pension fund commitments
12,774
-
63,115
- Increase / decrease in:
Other current assets
(14,126)
7,616
(22,730)
Accounts payable
39,106
160,191
1,976,059
Accrued expenses
64,462
16,943
2,889,056
Net cash used in operating activities
(1,171,550)
(272,806)
(14,140,942)
Cash flows from investing activities
Proceeds from securities available-for-sale
-
-
1,740,381
Short term investments
75,000
-
0
Other receivables related parties
(673,293)
-
(1,116,792)
Purchase of property and equipment
(1,002,487)
(129,804)
(14,203,267)
Down payments on purchase of investment
(1,300,082)
-
(4,400,139)
Other non-current assets
-
-
(241,500)
Net cash used in investing activities
(2,900,862)
(129,804)
(18,221,317)
Cash flows from financing activities
Net proceeds from deposit on stock
-
-
3,664,417
Proceeds from stock issuance
-
-
300,000
Proceeds from notes payable related parties
2,178,258
135,957
16,327,550
Repayment of notes payable related parties
-
-
(778,243)
Advances from third parties
-
-
700,000
Note payable
-
-
(714,819)
Proceeds from bond issuance, net of commissions
1,871,681
397,656
16,208,975
Payment for debt issuance costs
(316,189)
-
(2,506,480)
Purchase of treasury stock
-
-
(23,755)
Net cash provided by financing activities
3,733,750
533,613
33,177,646
Effect of exchange rate changes
17,775
(64,929)
(631,329)
Net increase / - decrease in cash
(320,887)
66,074
184,058
Cash, beginning of period
505,500
44,018
555
Cash, end of period
$
184,613
110,092
184,613
Additional information
Interest paid
-
-
Income taxes paid
-
-
* Cumulative: January 1, 2005 (date of inception) to March 31, 2012
The accompanying notes are an integral part of these consolidated financial statements.
7
SUNVESTA, INC.
(A Development Stage Company)
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2012
1.
CORPORATE INFORMATION
On August 27, 2007, SunVesta Inc. (SunVesta) acquired SunVesta Holding AG (SunVesta AG)
(collectively the Company). SunVesta AG has three wholly-owned subsidiaries: SunVesta
Projects and Management AG, a Swiss Company; Rich Land Investments Limitada, a Costa
Rican Company (Rich Land); and SunVesta Costa Rica Limitada, a Costa Rican Company.
In January 2005 (date of inception of development stage), the Company changed its business
focus to the development of holiday resorts and investments in the hospitality and related
industry. The Company has not materialized any revenues yet and is therefore a development
stage company.
These consolidated financial statements are prepared in US Dollars (US $) on the basis of
generally accepted accounting principles in the United States of America (US GAAP).
The accompanying unaudited consolidated financial statements have been prepared by
management in accordance with the instructions in Form 10-Q and, therefore, do not include all
information and footnotes required by generally accepted accounting principles and should,
therefore, be read in conjunction with the Companys Form 10-K, for the year ended December
31, 2011, filed with the Securities and Exchange Commission. These statements do include all
normal recurring adjustments which the Company believes necessary for a fair presentation of the
statements. The interim results of operations are not necessarily indicative of the results to be
expected for the full year ended December 31, 2012.
Except as indicated in the notes below, there have been no other material changes in the
information disclosed in the notes to the financial statements included in the Companys Form
10-K for the year ended December 31, 2011, filed with the Securities and Exchange
Commission. Therefore, those footnotes are included herein by reference.
2.
SIGNIFICANT ACCOUNTING POLICIES
New accounting standards - adopted
In May 2011, the Financial Accounting Standards Board (FASB) issued Accounting Standards
Update ("ASU") 2011-04, Fair Value Measurement (Topic 820): Amendments to Achieve
Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs,
which results in a consistent definition of fair value and common requirements for measurement
of and disclosure about fair value between accounting principles generally accepted in the United
States and IFRS. ASU 2011-04 is effective for interim and annual periods beginning after
December 15, 2011. The adoption of this standard had no effect on our results of operation or our
financial position. See Note 13 for additional information.
8
SUNVESTA, INC.
(A Development Stage Company)
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2012
2.
SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
New accounting standards - not yet adopted
In December 2011, the FASB released ASU 2011−11, Balance Sheet (Topic 210): Disclosures
about Offsetting Assets and Liabilities. ASU 2011−11 requires companies to provide new
disclosures about offsetting and related arrangements for financial instruments and derivatives.
The provisions of ASU 2011−11 are effective for annual reporting periods beginning on or after
January 1, 2013, and are required to be applied retrospectively. When adopted, ASU 2011−11 is
not expected to materially impact the Company's consolidated financial statements.
In February 2013, the FASB released ASU 2013-02 Other Comprehensive Income (Topic
220). The amendments in this Update supersede and replace the presentation requirements for
reclassifications out of accumulated other comprehensive income in ASUs 2011-05 (issued in
June 2011) and 2011-12 (issued in December 2011) for all public and private organizations. The
amendments would require an entity to provide additional information about reclassifications out
of accumulated other comprehensive income. This Accounting Standards Update is the final
version of Proposed Accounting Standards Update 2012-240Comprehensive Income (Topic
220) which has been deleted. The amendments do not change the current requirements for
reporting net income or other comprehensive income in financial statements. However, the
amendments require an entity to provide information about the amounts reclassified out of
accumulated other comprehensive income by component. In addition, an entity is required to
present, either on the face of the statement where net income is presented or in the notes,
significant amounts reclassified out of accumulated other comprehensive income by the
respective line items of net income but only if the amount reclassified is required under U.S.
GAAP to be reclassified to net income in its entirety in the same reporting period. For other
amounts that are not required under U.S. GAAP to be reclassified in their entirety to net income,
an entity is required to cross-reference to other disclosures required under U.S. GAAP that
provide additional detail about those amounts. For public entities, the amendments are effective
prospectively for reporting periods beginning after December 15, 2012. The adoption of this ASU
is not expected to materially impact the Companys consolidated financial statements.
In December 2011, the FASB released ASU 2011−10, Property, Plant and Equipment (Topic
360): Derecognition of in Substance Real Estatea Scope Clarification (a consensus of the
FASB Emerging Issues Task Force). ASU 2011−10 clarifies when a parent (reporting entity)
ceases to have a controlling financial interest in a subsidiary that is in substance real estate as a
result of default on the subsidiarys nonrecourse debt, the reporting entity should apply the
guidance for Real Estate Sale (Subtopic 360−20). The provisions of ASU 2011−10 are effective
for public companies for fiscal years and interim periods within those years, beginning on or after
June 15, 2012. When adopted, ASU 2011−10 is not expected to materially impact the Company's
consolidated financial statements.
9
SUNVESTA, INC.
(A Development Stage Company)
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2012
3.
GOING CONCERN
The Company is currently working on building the Paradisus Papagayo Bay Resort & Luxury
Villas project in the Papagayo Gulf Tourism Project area of Guanacaste, Costa Rica.
The project is expected to open in the fourth quarter of 2014. Until the completion of the project,
the following expenditures are estimated to be incurred:
Gross project cost
$
195,000,000
Less: Proceeds from sale of villas
$
- 24,000,000
Net project cost
$
171,000,000
Overhead expenses
$
21,000,000
Less: Recuperated in gross project cost
$
-12,000,000
Total, excluding other potential projects
$
180,000,000
60 % of Net project cost is going to be financed by traditional mortgage loans, for which
promising negotiations have been initiated. The remaining 40 % of Net project cost, as well as
non-recuperated overhead expenses and the cost of potential other projects are going to be
financed by the main shareholders or lenders of the project, i.e. Zypam Ltd., shareholder, Mr.
Hans Rigendinger, shareholder and board member of SunVesta Inc., Mr.Max Rössler, majority
shareholder of Aires International Investment, Inc. (Aires) (also refer to Note 6), Mr Josef
Mettler, shareholder, director and Chief Executive Officer.
Subsequent to March 31, 2012 they signed a Guaranty Agreement (refer to Note 15). Based on
this guaranty agreement, management therefore believes that available funds are sufficient to
finance cash flows for the twelve months subsequent to March 31, 2012 and the filing date of this
report though future anticipated cash outflows for investing activities will continue to depend on
the availability of financing and can be adjusted as necessary.
4.
PROPERTY & EQUIPMENT
March 31, 2012
December 31, 2011
$
$
Land
7,000,000
7,000,000
IT equipment
185,846
185,846
Other equipment and furniture
68,412
53,440
Leasehold improvements
66,617
66,617
Construction in progress
5,370,324
4,382,809
Gross
12,691,199
11,688,712
Less: Accumulated depreciation
(320,875)
(298,432)
Net
12,370,324
11,390,280
Depreciation expense for the three months periods ended March 31, 2012 and 2011 amounted
to $22,443 and $689, respectively.
10
SUNVESTA, INC.
(A Development Stage Company)
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2012
5.
CONSTRUCTION IN PROCESS
The Company possesses a concession for a piece of land (~84000 m2), i.e. a right to build a
hotel and apartments in the Papagayo Gulf Tourism Project, Guanacaste, Costa Rica, which
was acquired for $7 million and recorded as land in property and equipment.
The concession is a right to use the property for a specific purpose over a term of 20 years, which
term thereafter can be renewed at no further cost, if the Company is up to date with its obligations
as stipulated by the Costa Rican government and if no significant change in government policies
takes place. The current concession expires in June 2022.
The construction in process amount that was spent as of March 31, 2012 is attributed primarily to
architectural and project work related to the hotel and apartments.
11
SUNVESTA, INC.
(A Development Stage Company)
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2012
6.
RECEIVABLES AND NOTES PAYABLE TO RELATED PARTIES
Receivables
Payables
March 31,
December 31,
March 31,
December 31,
2012
2011
2012
2011
$
$
$
$
01-R Hans Rigendinger
-
53,212
-
-
01-P Hans Rigendinger
-
-
885,828
02
Josef Mettler
295,502
185,759
-
-
03
Turan Turkay
164,731
128,539
-
-
04
Adrian Oehler
-
-
33,218
31,928
05-R Zypam Ltd
278,860
39,118
-
-
05-P Zypam Ltd
-
-
2,598
-
06
Sportiva
94,472
36,872
-
-
07
Aires International
-
-
4,584,159
3,194,842
08
4f capital AG
334,400
-
-
-
Total excluding
interest
1,167,965
443,499
5,505,803
3,226,770
Accrued interest
-
-
117,664
62,387
Total
1,167,965
443,499
5,623,467
3,287,163
of which non-current
613,260
-
4,584,159
3,192,848
Related party
Capacity
Interest
Repayment
Security
Rate
Terms
01-R
Hans Rigendinger
Shareholder, and chairman of the
board of SunVesta Inc.
0.00%
None
None
01-P
Hans Rigendinger
Shareholder
3.00%
12.31.2012
None
02
Josef Mettler
Shareholder, chief executive officer,
chief financial officer and director
3.00%
12.31.2012
None
03
Turan Tokay
Shareholder
3.00%
12.31.2012
None
04
Adrian Oehler
Shareholder and director of SunVesta
Inc.
0.00%
None
None
Shareholder and company owned by
05-R
Zypam Ltd
the Company's director and chief
3.00%
None
None
executive officer
Shareholder and company owned by
05-P
Zypam Ltd
the Company's director and chief
0.00%
12.31.2012
None
executive officer
06
Sportiva
Company owned by the Company's
director and chief executive officer
3.00%
12.31.2012
None
07
Aires International
*** see hereinafter Note 7 and Note 15 ***
08
4f capital AG
Company owned by the Company's
director and chief executive officer
3.00%
None
None
12
SUNVESTA, INC.
(A Development Stage Company)
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2012
7.
NOTES PAYABLE TO RELATED PARTIES
Loan agreement with Aires International Investments, Inc.
On July 27, 2011 the Company signed a loan agreement with Aires, a company owned by a board
member of SunVesta AG, and which includes the following major conditions:
The lender grants Company a terminable, interest bearing and non-secured loan in the
maximum amount of CHF 6,000,000.
The loan is drawn in various portions between September 23, 2011 and December 9, 2011,
optionally, not later than February 29, 2012 with the option to exercise a conversion option
upon payment of the entire amount of CHF 6,000,000.
In principle, the loan will become due on September 30, 2015 being the latest date in time
when Aires can exercise its conversion option.
The interest rate is 7.25% and interest is due on September 30 of each year.
Provided that the entire amount of CHF 6,000,000 is paid in, the lender has the right to convert
this amount into 10% of the shares of Rich Land Investments Ltda. This conversion option is
valid until September 30, 2015.
As the above mentioned conversion option is contingent upon payment of the entire amount of
CHF 6 million and this contingency was not resolved as of March 31, 2012, the loan was valued
at fair value, which equals face value.
The loan agreement was also amended subsequent to balance sheet date of this quarterly reporting
(refer to Note 15).
8.
RELATED PARTY TRANSACTIONS
Receivables from related parties
All the shareholders listed under Note 6 have directly or indirectly - invested significant
amounts of money in the Company. As a result, some of them incurred short term cash needs,
which the Company satisfied by short term advances. Subsequent as of March 31, 2012 all
material receivables from related parties have been settled (refer to Note 15).
13
SUNVESTA, INC.
(A Development Stage Company)
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2012
9.
NON-CURRENT LIABILITIES
SunVesta Holding AG has bonds outstanding with the following major conditions.
Description
EUR () bond
CHF bond
Issuer:
SunVesta Holding AG
SunVesta Holding AG
Type of securities:
Bond in accordance with Swiss lawBond in accordance with Swiss law
Approval by SunVesta Holding May 12, 2010
June 3, 2011
AG Board of Directors
Volume:
Up to 25,000,000
Up to CHF 15,000,000
Units:
1,000
CHF 50,000
Offering period:
11/10/2010 04/30/2011
09/01/2011 02/28/2012
Due date:
November 30, 2013
August 31, 2015
Issuance price:
100 %
100%
Issuance day::
December 1, 2010
September 1, 2011
Interest rate:
8.25% p.a.
7.25% p.a.
Interest due dates:
November 30 of each year,
August 31 of each year,
the first time 30 November 2011 the first time August 31, 2012
Applicable law:
Swiss
Swiss
The nominal amounts have changed as follows:
EUR-Bond
CHF Bond
EUR-Bond
CHF Bond
2012
2012
2011
2011
$
$
$
$
Balances January 1
9,598,537
3,818,898
265,273
-
Cash inflows
465,981
1,405,701
9,883,151
4,188,870
Foreign currency adjustments
617,920
488,717
(360,179)
(91,382)
Sub-total (Fair value)
10,682,429
5,713,316
9,788,236
4,097,488
Commissions paid to
(248,195)
(295,778)
(248,195)
(295,778)
bondholders
Amortization of such
commissions
83,674
36,892
58,487
17,188
Balance March 31, 2012 and
December 31, 2011, respectively
(Carrying value)
10,517,908
5,454,430
9,598,537
3,818,898
14
SUNVESTA, INC.
(A Development Stage Company)
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2012
10.
PENSION PLAN
The Company maintains a pension plan covering all employees in Switzerland; it is considered a
defined benefit plan and accounted in accordance with ASC 715 ("compensation - retirement
benefits"). This model allocates pension costs over the service period of employees in the plan.
The underlying principle is that employees render services rateably over this period, and
therefore, the income statement effects of pensions should follow a similar pattern. ASC 715
requires recognition of the funded status, or difference between the fair value of plan assets and
the projected benefit obligations of the pension plan on the balance sheet, with a corresponding
adjustment to accumulated other comprehensive income. If the projected benefit obligation
exceeds the fair value of plan assets, then that difference or unfunded status represents the
pension liability.
The Company records a net periodic pension cost in the statement of operations. The liabilities
and annual income or expense of the pension plan is determined using methodologies that involve
several actuarial assumptions, the most significant of which are the discount rate and the long-
term rate of asset return (based on the market-related value of assets). The fair values of plan
assets are determined based on prevailing market prices.
Actuarial valuation
Net periodic pension cost has been included in the Companys results as follows:
March 31, 2012
March 31, 2011
Pension expense
Current service cost
$
25,383
25,383
Past service cost
-
-
Interest cost
772
772
Expected return on assets
(692)
(692)
Employee contributions
(10,164)
(10,164)
Net periodic pension cost
$
15,299
15,299
During the three-month periods ended March 31, 2012 and March 31, 2011 the Company made
cash contributions of $10,000 and $10,000, respectively, to its defined benefit pension plan.
All of the assets are held under the collective contract by the plans re-insurer Company and are
invested in a mix of Swiss and international bond and equity securities within the limits
prescribed by the Swiss Pension Law.
The expected future cash flows to be paid by the Company in respect of employer contributions
to the pension plan for the year ended December 31, 2012 are approximate $30,000.
15
SUNVESTA, INC.
(A Development Stage Company)
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2012
11.
AGREEMENT TO PURCHASE NEIGHBORING PIECE OF LAND
In 2010 SunVesta Holding AG concluded a sale and purchase agreement with a company called
DIA S.A. (DIA), being domiciled in San José, Costa Rica. The scope is the acquisition of a
neighboring piece of land with approximately 120,000 m2 having direct beach access through
acquisition of 100% of the shares of Altos del Risco S.A. shares of DIA. The total purchase
consideration is $12.7 million. Upon payment of the entire amount, ownership will be transferred
to the Company. As at March 31, 2012 and December 31, 2011, $3.9 million and $3.1 million has
been paid, respectively.The sixth addendum dated November 12, 2012, stipulates that:
$8.7 million has already been paid
$4.0 million has still to be paid
The current contractual situation does not call for any penalties in case of delays of payments.
The purchase of the neighbouring piece of land was officially completed within the 1st Quarter
2013.
12.
FUTURE LEASE COMMITMENTS
Since January 1, 2010 the Company has had sub-rental agreements for its Swiss offices with a
related party called Sportiva. The annual sub-rental expense is approximately $110,000. The
sub-rental agreement is concluded for an undetermined period of time, however, there is a verbal
agreement to maintain the agreement at least until December 31, 2013.
Subsequent to the period, on December 1, 2012, the Company entered into a new lease
agreement for the premises for its Swiss office with an unrelated entity. The annual rental
expense amounts to approximately $130,000 on a fixed term expiring on December 31, 2017.
13.
MANGEMENT AGREEMENT WITH MELIA HOTELS & RESORTS
In March 2011 the Company concluded an agreement with Sol Meliá, S.A. (Sol Meliá) for the
management of the planned resort in Guanacaste, Costa Rica. This agreement includes a clause
saying that if the Company is not able to conclude the purchase of the property described in Note
10 by November 30, 2011, then a penalty of $1 million would become due to Sol Meliá.
Therefore the Company recorded a liability in the full amount as of December 31, 2011 with the
corresponding expense recorded in general and administrative expense in the year ended
December 31, 2011.
On March 3, 2012, the deadline to pay the penalty of $1 million was extended by Sol Meliá to
June 30, 2012. By June 30, 2012, neither the whole penalty nor any part of the penalty had been
paid. Therefore the the deadline to pay the penalty of $1 million was extended from June 30,
2012 to August 31, 2012.
Regarding current situation subsequent to March 31, 2012 refer to Note 15 (Subsequent Events).
16
SUNVESTA, INC.
(A Development Stage Company)
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2012
14.
FAIR VALUE MEASUREMENT
The guidance on fair value measurements defines fair value as the exchange price that would be
received for an asset or paid to transfer a liability (an exit price) in the principal or most
advantageous market for the asset or liability in an orderly transaction between market
participants. This guidance also specifies a fair value hierarchy based upon the observability of
inputs used in valuation techniques. Observable inputs (highest level) reflect market data obtained
from independent sources, while unobservable inputs (lowest level) reflect internally developed
market assumptions. In accordance with this guidance, fair value measurements are classified
under the following hierarchy:
Level 1 Quoted prices for identical instruments in active markets.
Level 2 Quoted prices for similar instruments in active markets; quoted prices for
identical or similar instruments in markets that are not active; and model-derived
valuations in which all significant inputs or significant value drivers are observable in
active markets.
Level 3 Model-derived valuations in which one or more significant inputs or
significant value-drivers are unobservable.
When available, we use quoted market prices to determine fair value, and we classify such
measurements within Level 1. In some cases where market prices are not available, we make use
of observable market based inputs to calculate fair value, in which case the measurements are
classified within Level 2. If quoted or observable market prices are not available, fair value is
based upon internally developed models that use, where possible, current market-based
parameters such as interest rates, yield curves and currency rates. These measurements are
classified within Level 3.
Fair value measurements are classified according to the lowest level input or value-driver that is
significant to the valuation. A measurement may therefore be classified within Level 3 even
though there may be significant inputs that are readily observable.
Fair value measurement includes the consideration of nonperformance risk. Nonperformance risk
refers to the risk that an obligation (either by a counterparty or us) will not be fulfilled. For
financial assets traded in an active market (Level 1), the nonperformance risk is included in the
market price. For certain other financial assets and liabilities (Level 2 and 3), our fair value
calculations have been adjusted accordingly.
As of March 31, 2012 and December 31, 2011, respectively, there are no financial assets or
liabilities measured on a recurring basis at fair value.
17
SUNVESTA, INC.
(A Development Stage Company)
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2012
FAIR VALUE MEASUREMENT - CONTINUED
In addition to the methods and assumptions we use to record the fair value of financial
instruments as discussed above, we used the following methods and assumptions to estimate the
fair value of our financial instruments.
Cash and cash equivalents carrying amount approximated fair value.
Short term investments carrying amount approximated fair value.
Receivables from related parties (current) carrying amount approximated fair value due to the
short term nature of the receivables.
Receivables related parties (non current) The fair values of the receivables due from related
parties (non current) is classified as level 3 fair values. The fair values of the notes were
determined by discounting cash flow projections discounted at the respective interest rates of
similar transactions of 3.00%. Hence, the carrying value approximate fair value.
Accounts Payable carrying amount approximated fair value.
EUR-bond The fair values of the bonds payable are classified as level 3 fair values. The fair
values of the bonds have been determined by discounting cash flow projections discounted at the
respective interest rates of 8.25% for EUR bonds, which represents the current market rate based
on the creditworhiness of the Company. Hence, the carrying values approximate fair value.
CHF-bond The fair values of the bonds payable are classified as level 3 fair values. The fair
values of the bonds have been determined by discounting cash flow projections discounted at the
respective interest rates of 7.25% for CHF bonds, which represents the current market rate based
on the creditworhiness of the Company. Hence, the carrying values approximate fair value.
Notes payable to related parties (current) Rigendinger carrying amount approximated fair
value due to the short term nature of the note payable.
Notes payable to related parties (current) other carrying amount approximated fair value due
to the short term nature of the note payable.
Notes payable to related parties Aires The fair values of the notes payable to Aires
International Investments Inc. is classified as level 3 fair values. The fair values of the notes were
determined by discounting cash flow projections discounted at the respective interest rates of
7.25%, which represents the current market rate based on the creditworhiness of the Company.
Hence, the carrying value approximate fair value.
18
SUNVESTA, INC.
(A Development Stage Company)
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2012
14.
FAIR VALUE MEASUREMENT CONTINUED
The fair value of our financial instruments is presented in the table below:
March 31, 2012
December 31, 2011
Carrying
Carrying
Fair
Fair Value
Amount
Fair Value
Amount
Value
Levels
Reference
Cash and cash
equivalents
184,613
184,613
505,500
505,500
1
None
Short term
investments
0
0
75,000
75,000
1
None
Receivables from
related parties
554,705
554,705
443,499
443,499
3
(current)
Note 6
Receivables related
parties (non-
613,260
0
0
0
current)
3
Note 6
Accounts
Payable
1,440,243
1,440,243
1,401,137
1,401,137
1
None
Notes payable to
related parties
35,816
35,816
31,928
31,928
other (current)
3
Note 6
Notes payable to
related parties
885,828
885,828
0
0
Rigendinger
3
Note 6, 15
(current)
EUR-bond
10,517,908
10,517,908
9,598,537
9,598,537
3
Note 9
CHF-bond
5,454,430
5,454,430
3,818,898
3,818,898
3
Note 9
Notes payable to
related parties
4,584,159
4,584,159
0
0
3
Note 6,7,15
Aires (non-current)
19
SUNVESTA, INC.
(A Development Stage Company)
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2012
15.
SUBSEQUENT EVENTS
General
The Company has evaluated subsequent events after the date balance sheet date through the
issuance of the financial statements for appropriate disclosure. With the exception of what is
stated hereafter, the Company is not aware of such events, which would require adjustments to or
disclosure in the consolidated financial statements.
Intention to purchase two additional concession properties at Polo Papagayo, Guanacaste
On April 20, 2012, the Company entered into an agreement to purchase two additional concession
properties located at Polo Papagayo, Guanacaste, with a total surface of approximately 230,000
square meters for a price of $22,895,806, whereof fifty percent is to be paid in cash and the other
fifty percent in ten percent equity of La Punta (the concession properties in Polo Papagayo) and
five percent in equity of Paradisus Papagayo Bay Resort & Luxury Villas (the hotel currently
under construction), both located in Costa Rica. The payment schedule is as follows:
$0.5 million is required as a cash payment by May 16, 2012
$5.0 million is required as a cash payment by August 31, 2012
$5.698 million is required as a cash payment by January 31, 2013
Equity is required to be transferred upon final payment
If the Company elects not to proceed with the purchase, the purchaser is in default and will lose
its funds on deposit.
On November 13, 2012 the above agreement was amended to decrease the total purchase price to
$17.2 million with no equity payment. The terms and conditions of the cash payment are yet to be
defined. Furthermore, all payments by the Company to date and in the future are refundable.
Subsequent to signing the agreements, the Company paid down-payments on the purchase of the
properties of approximately $1,400,000 of which $500,000 was paid as of March 31, 2012.
Advisory Services Agreements
In order to raise the necessary funds for the completion of the project, various advisory service
agreements have been concluded, both in Europe as well as Central America. In addition, a
European rating agency has been engaged in order to receive a rating. While the basic cost for the
advisory services are not significant, the actual funding will be accompanied by costs (finders
fees).
20
SUNVESTA, INC.
(A Development Stage Company)
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2012
15.
SUBSEQUENT EVENTS
Amendments to Line of Credit Agreement with Aires International Investment, Inc.
The line of credit agreement with Aires, which is described in Note 5 and Note 6, was amended
on May 11, 2012 with the following clauses:
The loan amount was increased by an additional CHF 4,000,000 (four million Swiss Francs) to a
total amount of CHF 10,000,000 (ten million Swiss francs). The additional CHF 4,000,000 will
be paid in installments through the end of July 2012.
Once the entire amount of CHF 10,000,000 has been drawn down, Aires has the right to convert
its entire loan of CHF 10,000,000 into a 20% holding of the capital of the Company.
The conversion right granted in the original contract to convert the balance of the line of credit
into 10% ownership interest in Rich Land was cancelled.
The entire amount of CHF 10,000,000 is subordinated in favor of other creditors.
A letter signed by Aires on June 21, 2012 agreed to increase the line of credit by CHF 2,000,000
to a total amount of CHF 12,000,000.
The Company and Aires are currently negotiating a revised conversion option to replace the one
stated above. The major contemplated change is that Aires International will convert its
receivable into preferred shares of shares of the Company with a fixed interest payment with the
option to convert into shares of the Companys common stock at a discount to market within a
limited time frame. The parties are yet to come to an agreement.
As of the filing date of this report the Company has borrowed CHF 16.24 million (approximately
$17.30 million) from the Aires line of credit.
Guaranty Agreement
On July 16, 2012, certain principal shareholders of the Company or principal lenders to the
project entered into a guaranty agreement in favour of SunVesta AG. The purpose of the
guarantee is to ensure that until such time as financing is secured for the entire project that they
will act as a guarantor to creditors to the extent of the projects ongoing capital requirements. The
guaranty agreement requires that within 30 days of receiving a demand notice, the guarantors are
required to pay to SunVesta AG that amount required for ongoing capital requirements, until such
time as financing of the project is secured. The guaranty may not be terminated until such time as
SunVesta AG has secured financing for the completion of the project.
21
SUNVESTA, INC.
(A Development Stage Company)
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2012
15.
SUBSEQUENT EVENTS
Hotel Project Atlanta
During the 3rd Quarter 2012 the Company entered into an purchase agreement for a hotel and
entertainment complex in Atlanta, Georgia (United States of America).
The entire purchase amount of $26 million for the assets has no firm financing commitment.
Additionally, approximately an additional $18 millions for renovations would need to be invested
in the hotel and entertainment complex. The Company is in negotations with various parties to
finalize a financing package for this project and is confident that it will be able to procure such
financing.
Nonwithstanding of all other facts the Company may terminate this agreement within a due
dilligence period, if it is not satisfied with the property after a examination of the assets.
The agreement includes a non-refundable deposit of $250,000.
Opening Date Paradisius Papagayo Bay Resort & Luxury Villas
During the 3rd Quarter 2012 the Company postponed the opening date for the Papagayo Gulf
Tourism Project of Costa Rica, which is now scheduled for winter 2014.
Tax Liability Contingency
On April 2, 2012 the Company was advised by the Internal Revenue Services (IRS) of aggregate
penalties amounting to $140,000 in connection with failure to file certain tax return for the years
ended 2008, 2009 and 2010. The Company is still in correspondence with the IRS in order to seek
an abatement of the penalties.
Since the abatement has not been sought through an appeal process the Company recorded a
liability in the full amount of $140,000 within the 2nd Quarter 2012.
EUR Bond Offering
The Company initiated a EUR bond offering on December 1, 2010 of up to EUR 25,000,000 in
units of EUR 1,000 that bear 8.25 % interest per annum payable each November 30 over the term
of the bonds due November 30, 2013.
A cumulative amount of EUR 9.45 million ($12.36 million) has been realized by the Company
from the initial date up to April 4, 2013.
22
SUNVESTA, INC.
(A Development Stage Company)
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2012
15.
SUBSEQUENT EVENTS
CHF Bond Offering
The Company initiated a CHF bond offering on September 1, 2011 of up to CHF 15,000,000 in
units of CHF 50,000 that bear 7.25 % interest per annum payable each August 31 over the term of
the bonds due August 31, 2015.
A cumulative amount of CHF 5.6 million ($5.9 million) has been realized by the Company from
the initial date up to April 4, 2013.
Management Agreement with Melia Hotels & Resorts (current)
On February 5, 2013, the Company extended the deadline to complete the purchase of the
property described in Note 12, pursuant to the terms of the management agreement with Sol
Meliá, to March 15, 2013 and concluded the purchase of the property on March 9, 2013.
Since the Company concluded the purchase of the property described within the extension period
the penalty otherwise payable to Sol Meliá and the corresponding allowance will be eliminated as
of March 9, 2013. Therefore, the Company will recognize a book entry gain related to this
transaction in the 1st Quarter 2013.
Related Party Transactions receivables from related parties
As described in Note 6 and Note 8 the Company had as of March 31, 2012 various receivables
from related parties. All these balances have been repayed as per December 31, 2012 and
therefore the Company no longer has any receivables from related parties as per end of the
financial year 2012.
Notes payable to related parties Rigendinger (current)
As described in Note 6 the Company owed to Mr. Hans Rigendinger, who was appointed chief
operating officer as of February 4, 2013, an amount of $885,828 and $0 as of March 31, 2012
December 31, 2011, respectively . A debt settlement agreement, effective December 31, 2012,
settled the outstanding balance of $717,977 as of December 31, 2012 with Mr. Rigendinger, as
described hereinafter:
The Company issued 17,949,417 of its common shares ($0.01 par value) at a conversion price of
$0.04 for purposes of this debt settlement agreement.
Loans Dr. Max Rössler (current)
Subsequent to March 31, 2012, the Company entered into various short term loan agreements
with Dr. Max Rössler that have not been repaid as originally stipulated on or before December
17, 2012. Therefore, the Company agreed with Mr. Rössler, on February 5, 2013, that all of these
short term loans will be repayable on May 30, 2013.
23
ITEM 2.
MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
This Managements Discussion and Analysis of Financial Condition and Results of Operations and other
parts of this quarterly report contain forward-looking statements that involve risks and uncertainties.
Forward-looking statements can be identified by words such as anticipates, expects, believes,
plans, predicts, and similar terms. Forward-looking statements are not guarantees of future
performance and our actual results may differ significantly from the results discussed in the forward-
looking statements. Factors that might cause such differences include but are not limited to those
discussed in the subsection entitled Forward-Looking Statements and Factors That May Affect Future
Results and Financial Condition below. The following discussion should be read in conjunction with our
financial statements and notes hereto included in this report. All information presented herein is based on
our three month periods ended March 31, 2012 and March 31, 2011. Our fiscal year end is December 31.
Discussion and Analysis
Business Overview
We are in the process of developing high-end luxury hotels and resorts in emerging tourist destinations.
We are initially concentrating on offering luxury hotel products located in attractive, top-class coastal
vacation destinations in countries such as Costa Rica, Vietnam, and Turkey that are fast emerging as
popular tourist destinations. Country specific conditions are taken into account when properties are
considered for development. General considerations as to where to develop properties include the stability
of local political conditions, geologically useful cultivability, and the types of destinations that attract a
five-star clientele. Each potential investment is first compared against a validation checklist and then, if
warranted, subjected to a substantial due diligence process. Since location is the key to the success of any
tourist based luxury real estate project, each development will be carefully considered during the
eligibility process.
Initial Development
Our initial real estate development, to be constructed on 20.5 hectares of prime land located in
Guanacaste Province, Costa Rica, is the Paradisus Papagayo Bay Resort & Luxury Villas, a five star
luxury hotel scheduled to open in November 2014 subject to requisite financing.
Specifications
Paradisus Papagayo Bay Resort & Luxury Villas initial specifications are to be as follows:
Eco-luxury all-inclusive resort;
381- keys
Direct beach access;
Five restaurants and five bars;
Yhi Spa and Health Club;
Paradisus adults-only Royal Service level of accommodations;
Paradisus Family Concierge program; and
19,000 square feet of meeting facilities with the business traveler in mind.
24
Royal Service
Our Royal Service will include an extensive range of services such as butler service, private pools for
each Garden Villa and/or a Jacuzzi in every suite.
The Royal Service area will include:
112 Junior Suites Grand Deluxe
(53-60* square meters)
3 Junior Suites Grand Deluxe for Handicapped Guests
(53* square meters)
6 Grand Master Suites
(82* square meters)
1 Grand Presidential Suite (4 bedrooms)
(145* square meters)
20 one or two bedroom Garden Villas
(91 117* square meters)
*
Room size does not include balconies and terraces.
All ground floor suites will have direct access to swim-up pools. Each of the suites and villas will have a
full view of the sea. Royal Service guests will furthermore have access to restaurants, bars, lounges,
fitness equipment, spas and outside massage areas.
Family Concierge
The Family Concierge will be the family orientated part of the Paradisus Papagayo Bay Resort & Luxury
Villas. The accommodations will be designed to satisfy the needs of the modern family.
166 Junior Suites Deluxe
(47* square meters)
34 Suites Deluxe
(87* square meters)
34 Suites Premium
(93* square meters)
6 Handicapped Junior Suites Deluxe
(47* square meters)
1 Presidential Suite
(189* square meters)
*
Room size does not include balconies and terraces.
All ground floor suites will have direct access to swim-up pools. Each of the suites will have a full view
of the sea. Family Concierge guests will furthermore have access to restaurants, bars, and lounges. The
intended Onyx Night Club and the Gabi Club will be located near the beach.
The Paradisus Papagayo Bay Resort & Luxury Villas will feature other highlights including:
Over 65 private, swim up and resort pools including the worlds second largest Infinity Pool all
within idyllic landscaped grounds.
A wedding chapel with a stunning ocean view.
Rain forest walkways that permit guests to experience the flora and fauna of the rain forest.
A multipurpose convention hall with over 2,000 square metres of space that can be utilized as a whole
or divided to create smaller meeting rooms.
A full service spa committed to providing for the wellbeing of our guests. The spa will be located
with a 180 degree sea view within approximately 1,000 square metres that will include 12 large
treatment rooms, a hairdresser, relaxation areas, pools, saunas and steam rooms.
The 20 private villas will be located within the Royal Service area of the resort. The present intention
being that these villas will be sold to individuals who will then let them back to the resort when not
occupied by the owners.
25
Management
Overall project development is lead by Josef Mettler, our chief executive officer, Charles Fessel, project
director Paradisus Papagayo Bay Resort & Luxury Villas, Hans Rigendinger, chairman of the board
SunVesta Inc. and Ernst Rosenberger, the Companys corporate controller. The lead architect is
Ossenbach, Pendones & Bonilla, one of Costa Ricas largest architectural offices with over 45 architects
and designers. Civil engineering services are provided by DEHC Engineers and structural engineering
services by IEAC. Landscape architects are TPA and interior designers are lead by Concreta Srl.
Resort management is to be provided by Meliá Hotel International, S.A. (Sol Meliá). Paradisus is Sol
Meliás five star all-inclusive luxury hotel brand that is well recognized in the hospitality industry around
the world. Sol Meliá was founded in 1956 in Palma de Mallorca, Spain and is today one of the worlds
largest resort hotel chains, as well as Spains leading hotel chain for business or leisure. The company
currently offers more than 300 hotels in 26 countries over four continents under its Gran Meliá, Meliá,
ME by Sol Meliá, Innside by Sol Meliá, Tryp, Sol, Sol Meliá Vacation Club, and Paradisus brands. The
Paradisus brand represents all-inclusive luxury resorts with hotels in Mexico and the Dominican
Republic, including:
Paradisus Palma Real (Dominican Republic):
o 496 oversized suites; and
o numerous pools and whirlpools, five tennis courts, casino, beach, golf, meeting space,
five restaurants, two buffets, nine bars, etc.
The Reserve at Palma Real (Dominican Republic):
o 184 rooms Residential Concierge Suites; and
o Private beach, swimming pools, 7800 sq ft Kids Zone, 24,000 sq. ft. Yhi Spa, three
restaurants, two buffets, two bars, etc.
Paradisus Punta Cana (Dominican Republic):
o 884 oversized suites (500 - 1000+ sq ft); and
o seven pools, four tennis courts, casino, beach, Kids Zone, Yhi Spa and fitness, meeting
rooms, 12 restaurants, eight bars, etc.
The Reserve at Punta Cana (Dominican Republic):
o 132 residential suites; and
o pools (with partially underwater pool beds, water features, etc), private beach, spa,
cabanas, etc.
La Esmeralda at Playa del Carmen (Mexico opening November 2011)
o 512 suites including 56 swim-up suites; and
o spas, meeting spaces, 11 restaurants, 10 bars, etc. (partially shared with La Perla at Playa
del Carmen).
La Perla at Playa del Carmen (Mexico opening November 2011)
o 394 suites including 60 swim-up suites;
o Paradisus adults-only Royal Service level of accommodations; and
o spas, meeting spaces, 11 restaurants, 10 bars, etc. (partially shared with La Esmeralda at
Playa del Carmen).
Our Paradisus Papagayo Bay Resort & Luxury Villas development is intended to replace Paradisus
Resorts former Paradisus Playa Conchal in Guanacaste, Costa Rica which property was operated by Sol
Meliá until April 30, 2011. Our project is part of Sol Meliás master expansion plan, which includes the
opening of two resorts in Playa del Carmen, Mexico in November of 2011. Sol Meliá aims to solidify
Paradisus Resorts as a leader in the luxury all-inclusive market segment with the new properties in Playa
del Carman and our own Paradisus Papagayo Bay Resort & Luxury Villas project.
26
Additional Concession Properties
Subsequent to the period of this report, on April 20, 2012, SunVesta AG entered into an agreement with
Meridian IBG to purchase two additional concession properties. The additional concession properties
have a total surface of approximately 230,000 square metres purchased for a total of $22,895,806, on
terms whereby fifty percent was to be paid in cash and the other fifty percent with the transfer of a ten
percent equity interest in La Punta (the concession properties in Polo Papagayo on which the project will
be located) and a five percent equity interest in Paradisus Papagayo Bay Resort & Luxury Villas. The
payment schedule was as follows:
$0.5 million is required as a cash payment by May 16, 2012
$5.0 million is required as a cash payment by August 31, 2012
$5.698 million is required as a cash payment by January 31, 2013
Equity is required to be transferred upon final payment
Subsequent to the period of this report, on November 13, 2012, the purchase agreement for additional
concession properties in Polo Papagayo was amended to decrease the total cash purchase price to $17.2
million and to delete the equity component for both La Punta and the Paradisus Papagayo Bay Resort &
Luxury Villas. New terms and conditions for the payment of the new purchase price are yet to be defined.
SunVesta AG has paid down-payments on the purchase of the additional concession properties of
approximately $1,400,000 as of the filing date of this report.
Hotel and Entertainment Complex (Atlanta, Georgia, U.S.A)
Subsequent to the period of this report, during the third quarter 2012, the Company entered into
an agreement to purchase a hotel and entertainment complex in Atlanta, Georgia, U.S.A. The
entire purchase amount of $26 million for the assets has no firm financing commitment.
Additionally, approximately an additional $18 million for renovations would need to be invested
in the hotel and entertainment complex. The Company is in negotiations with various parties to
finalize a financing package for this project and is confident that it will be able to procure such
financing. Nonwithstanding all other factors, the Company may terminate this agreement, within
a due dilligence period, if it is not satisfied with the property after an examination of the assets.
The agreement includes a non-refundable deposit of $250,000.
Finance
The anticipated completion of the Paradisus Papagayo Bay Resort & Luxury Villas in November of 2014
will require a total investment of approximately $180 million of which approximately $16 million has
been spent as of March 31, 2012. We expect to realize a minimum of $20 million in new funding over the
next twelve months to progress the development and an additional $144,000,000 in funding by the time
the development is completed. New funding over the next twelve months is expected to be raised from
debt financing through bonds, a fixed line of credit and, as necessary, the guaranty agreement in place as
described in the going concern paragraph.
SunVesta AG, our wholly owned subsidiary, is in the process of issuing fixed-income Euro denominated
bonds up to an aggregate amount of 25,000,000 and fixed income CHF denominated bonds up to an
aggregate amount of CHF 15,000,000 to fund the initial development of the Paradisus Papagayo Bay
Resort & Luxury Villas project.
27
The Euro bonds are unsecured, have a three year term, bear interest at 8.25% per annum payable each
November 30 over the term due November 30, 2013. SunVesta AG raised $9,598,537 in the twelve
months ended December 31, 2011 and $919,371 in the three months ended March 31, 2012, for a total of
approximately $12,360,000 as of the filing date of this report, in connection with the Euro bond offering.
The CHF bonds are unsecured, have a three year term, bear interest at 7.25% per annum payable each
August 31 over the term due August 31, 2015. SunVesta AG raised $3,818,898 in the twelve months
ended December 31, 2011 and $1,635,532 in the three months ended March 31, 2012, for a total of
approximately $5,900,000 as of the filing date of this report in connection with the CHF bond offering.
SunVesta AG entered into a line of credit agreement with Aires International Investment, Inc. (Aires)
on July 27, 2011 allowing it to borrow up to CHF 6,000,000 by February 29, 2012. The line of credit
bears interest at 7.25% and was secured by 10% of the stock of Rich Land. Interest payments are due
September 30 of each year with the line of credit maturing on September 30, 2015. Prior to maturity, if
the maximum credit limit was borrowed, Aires had the option to convert the balance of the line of credit
into a 10% ownership interest in Rich Land.
Subsequent to the period of this report, on May 11, 2012, the parties to the Aires line of credit agreement
executed an addendum to the existing line of credit agreement that includes the following clauses:
The line of credit amount was increased by CHF 4,000,000 to a total amount of CHF 10,000,000.
The additional CHF 4,000,000 to be paid in installments through the end of July 2012.
Should the entire amount of CHF 10,000,000 be drawn down, Aires will have the right to convert
the entire line of credit of CHF 10,000,000 into a 20% holding of the capital of SunVesta.
The conversion right granted in the original contract to convert the balance of the line of credit
into a 10% ownership interest in Rich Land was cancelled.
The entire amount of CHF 10,000,000 is subordinated in favor of other creditors.
Subsequent to the period of this report, on June 21, 2012, pursuant to a letter agreement, Aires
agreed to increase the line of credit by CHF 2,000,000 to a total amount of CHF 12,000,000.
SunVesta AG and Aires are currently in the process of negotiating a revised conversion option to
replace the existing option to convert CHF 10,000,000 into a 20% holding in the capital of the
Company. The major contemplated change is that Aires will convert its receivable at the time of
conversion into 20% of the preferred shares of the Company, at a price and with preferential
rights yet to be determined. The parties are yet to reach an agreement.
As of December 31, 2011 SunVesta AG had borrowed CHF 3,000,000 ($3,195,000) from the
Aires line of credit, and as of March 31, 2012 SunVesta AG had borrowed CHF 4,140,000
($4,584,210) for a total of approximately CHF 16.24 million ($17,300,000) as of the filing date of
this report.
The Aires line of credit has been fully exhausted as of the filing date of this report.
The Company expects that the remaining amounts required to complete the Paradisus Papagayo Bay
Resort & Luxury Villas will be realized in the form of a construction loan, equity placements and, as
necessary, the guaranty agreement.
28
Timeline
Our expected timeline for developing the Paradisus Papagayo Bay Resort & Luxury Villas is as follows:
Complete revisions of architectural plans which will incorporate Sol Meliá requirements in the 1st
quarter of 2013;
Receive traditional construction loan in the 2nd quarter of 2013;
Receive final building permits in 2nd quarter of 2013;
Begin construction in the 2nd quarter of 2013; and
Complete construction work in the 4th quarter of 2014.
Results of Operations
During the three months ended March 31, 2012, our operations were focused on (i) funding the terms of
an agreement with DIA S.A. to purchase an additional 12 hectares contiguous with our existing property
that will provide the project with direct private beach access; (ii) deliberations with local authorities to
obtain building permits for the development of the property; (iii) discussions with prospective project
development partners; (iv) pursuing additional debt or equity financing arrangements including a bond
offering through SunVesta Holding AG in Europe and a line of credit with Aires.
The Company has been funded since inception from debt or equity placements and by shareholders or
partners in the form of loans. All of the capital raised as of the filing date of this report has been allocated
to the development of the Costa Rican property including the purchase of the land and general and
administrative costs.
Comprehensive Losses
For the period from the date of inception of development stage on January 1, 2005, until March 31, 2012,
the Company had incurred comprehensive losses of $24,666,030. Comprehensive losses for the three
months ended March 31, 2012 were $2,137,300 as compared to $560,702 for the three months ended
March 31, 2011. The increase in comprehensive losses over the comparative periods can be attributed to
the loss on foreign currency translation of $802,775 as compared to a loss of $83,074, which loss is due to
volatility between Swiss Francs and US Dollars, the related foreign currency translation difference on
intercompany loans that is classified as a permanent investment and the translation of the financial
positions and results of operations of our foreign subsidiaries. Other contributing factors to the increase in
comprehensive losses over the comparative three month periods ended March 31, 2012 and March 31,
2011, respectively, include increases in general and administrative expenses to $971,627 from $438,018,
of which significant components were an increase in finders fees of approximately $180,000 associated
with the management agreement with Sol Meliá, an increase in investor relations expenses incurred in
connection with the bond offerings of approximately $161,000 and other expenses which increased
approximately $192,000, in addition to interest expenses on outstanding debt which increased to
$280,995 from $33,626, as the result of the debt associated with the bond offerings, non-cash
amortization of debt issuance costs of $229,288, also the result of the bond offerings and the notes
payable to related parties, offset by interest income of $3,060, the gain on currency exchange differences
of $130,272, due to volatility in the currency markets and other income of $14,053.
We did not generate revenue during this period and we expect to continue to incur losses through the year
ended December 31, 2012.
29
Income Tax Expense (Benefit)
The Company has a prospective income tax benefit resulting from a net operating loss carry-forward and
startup costs that will offset future operating profits.
Capital Expenditures
The Company expended a significant amount on capital expenditures for the period from January 1, 2005
to March 31, 2012, in connection with the purchase of land that includes a hotel concession in Costa Rica
and expects to incur future cash outflows on capital expenditure as discussed in the "Liquidity and Capital
Resources" and the "Going Concern" paragraphs below.
Liquidity and Capital Resources
The Company has been in the development stage since inception and has experienced significant changes
in liquidity, capital resources, and stockholders equity.
As of March 31, 2012, we had a working capital deficit of $4,204,657. We had current assets of $761,219
and total assets of $20,145,618. Our current assets consisted of $184,613 in cash, $21,901 in other assets
and $554,705 in receivables from related parties. Our total assets consisted of current assets and property
and equipment of $12,370,324, net debt issuance costs of $1,751,540, down payments for property and
equipment of $4,400,140, other assets of $249,135 and receivables from related parties of $613,260. We
had current liabilities of $4,965,876 and total liabilities of $25,585,488. Our current liabilities consisted of
$1,440,242 in accounts payable, $2,486,326 in accrued expenses, and $1,039,308 in notes payable to
related parties. Our total liabilities consisted of current liabilities and EUR bond debt of $10,517,908,
CHF bond debt of $5,454,430, note payable to related parties of $4,584,159 and pension liabilities of
$63,115. Total stockholders deficit in the Company was $5,439,870 at March 31, 2012.
For the period from January 1, 2005 to March 31, 2012, net cash used in operating activities was
$14,140,942. Net cash used in operating activities for the three months ended March 31, 2012, was
$1,171,550 as compared to $272,806 for the three months ended March 31, 2011. Net cash used in
operating activities in the current three month period ended March 31, 2012, can be attributed primarily to
general and administrative expenses, that include but are not limited to, personnel costs, accounting fees,
consulting expenses, finders fees and professional fees, such as for auditing purposes and legal
consultation, offset by changes in accounts payable and accrued expenses. Net cash used in operating
activities in the prior three month period ended March 31, 2011, can also be primarily attributed to
general and administrative expenses, offset by changes in accounts payable and accrued expenses.
We expect to use net cash in operating activities until such time as net losses transition to net income
which transition is not anticipated until we complete the Paradisus Papagayo Bay Resort & Luxury Villas
project.
For the period from January 1, 2005 to March 31, 2012, net cash used in investing activities was
$18,221,317. Net cash used in investing activities for the three months ended March 31, 2012, was
$2,900,862 as compared to $129,804 for the three months ended March 31, 2011. Net cash used in
investing activities in the current three month period can be attributed to receivables from related parties,
the purchase of property and equipment and down payments for property, offset by the receipt of short
term investments. Net cash used in investing activities in the prior three month period ended March 31,
2011, can be attributed to the purchase of property and equipment.
30
We expect to use net cash in investing activities in future periods while we develop the Paradisus
Papagayo Bay Resort & Luxury Villas.
For the period January 1, 2005 to March 31, 2012, net cash provided by financing activities was
$33,177,646. Net cash provided by financing activities for the three months ended March 31, 2012, was
$3,733,750 as compared to $533,613 for the three months ended March 31, 2011. Net cash provided by
financing activities in the current three month period ended March 31, 2012, can be attributed to proceeds
from SunVesta AGs bond issuance net of commissions and proceeds from notes payable to related
parties offset by the payment of debt issuance costs. Net cash provided by financing activities in the prior
three month period ended March 31, 2011, can be attributed to proceeds from notes payable to related
parties and proceeds from SunVesta AGs bond issuance net of commissions.
We expect net cash provided by financing activities in future periods from SunVesta AGs bond offering,
the credit line with Aires, equity placements and, as necessary the guaranty agreement.
Management believes that our cash on hand in addition to the guaranty agreement in place as described in
the going concern paragraph below are sufficient for us to conduct operations over the next twelve
months. Debt financing efforts consist of bond offerings in progress and a credit line commitment agreed
with Aires that permits us to draw capital as necessary to meet ongoing operational requirements. The
Company has, as of the filing date of this filing, realized $18,260,000 through its bond offerings and
drawn down approximately $17,300,000 from its credit line with Aires.
We had a line of credit in place with Aires against which SunVesta Holding AG has borrowed CHF
3,000,000 ($3,195,000) as of December 31, 2011, and CHF 4,140,000 ($4,584,210) as of March 31, 2012
and CHF 16,240,000 ($17,300,000) as of the filing date of this report. The amount borrowed to date is in
excess of that anticipated by the line of credit agreement and the Aires debt facility is exhausted as of the
filing date of this report. Otherwise, we had no lines of credit or other bank financing arrangements as of
March 31, 2012.
We have commitments to DIA, S.A (DIA) and other third parties as of March 31, 2012, in connection
with the purchase of property parcels made part of the development, and certain commitments to the
Costa Rican government for water and development rights as well as for the planning and construction of
the resort project. As of the filing date of this report our commitment to DIA has been met.
As of the filing date of this report, the Company has the following cancellable commitments which are
not included in the overall financing of $180 million to complete the Papagayo Gulf Tourism Project.
The Company entered into an agreement to purchase two additional concession properties located
at Polo Papagayo, Guanacaste, with a total surface of approximately 230,000 square meters for a
price of $17.2 million. The terms and conditions of the cash payment are yet to be defined.
Furthermore, all payments by the Company to date and in the future are refundable.
The Company entered into an agreement to purchase a hotel and entertainment complex in
Atlanta, Georgia (United States of America). The entire purchase amount of $26 million for the
assets has no firm financing commitment. Additionally, approximately an additional $18 million
for renovations would need to be invested in the hotel and entertainment complex. The Company
is in negotiations with various parties to finalize a financing package for this project and is
confident that it will be able to procure such financing. Notwithstanding all other factors, the
Company may terminate this agreement, within a due diligence period, if it is not satisfied with
the property after an examination of the assets. The agreement includes a non-refundable deposit
of $250,000.
31
We maintain a defined benefit plan that covers all of our Swiss employees though we have no contractual
commitment with our sole officer and director.
We have no current plans for significant purchases or sales of plant or equipment, except in connection
with the planned construction of the Paradisus Papagayo Bay Resort & Luxury Villas as discussed above.
We have no current plans to make any changes in the number of our employees.
Future Financings
We will continue to rely on debt or equity sales of our shares of common stock to fund our business
operations. Unfortunately, there is no assurance that we will be able to secure the financing requisite to
fund our business.
Off-Balance Sheet Arrangements
As of March 31, 2012, we had no significant off-balance sheet arrangements that have or are reasonably
likely to have a current or future effect on our financial condition, changes in financial condition,
revenues or expenses, results of operations, liquidity, capital expenditures, or capital resources that are
material to stockholders.
Going Concern
The Company intends to build a hotel in the Papagayo Gulf Tourism Project area of Guanacaste, Costa
Rica. The total net investment is estimated to be approximately $180 million.
The project is expected to open in the fourth quarter of 2014. Until the completion of the project,
the following expenditures are estimated to be incurred:
$1,000
a. Gross project cost
195,000
b. Less: Proceeds from sale of villas
-24,000
c. Net project cost
171,000
d. Overhead expenses
21,000
e. Less: Recuperated in gross project cost
-12,000
f Total, excluding other potential projects
180,000
Sixty percent (60%) of net project cost is expected to be financed by traditional mortgage loans, for which
negotiations have been initiated. The remaining forty percent (40%) of net project cost, as well as non-
recuperated overhead expenses and the cost of prospective other projects are expected to be financed by
the primary promoters of the project, i.e.:
a.
Zypam Ltd.
b.
Mr. Hans Rigendinger
c.
Mr. Max Rössler
d.
Mr. Josef Mettler
Based on the guaranty agreement, management therefore believes that available funds are sufficient to
finance cash flows for the next twelve months though future anticipated cash outflows for investing
activities will continue to depend on the availability of financing and can be adjusted as necessary.
32
Subsequent to period end, certain principal shareholders of the Company or principal lenders to the
project entered into a guaranty agreement in favor of SunVesta AG. The purpose of the guarantee is to
ensure that until such time as financing is secured for the entire project that they will act as a guarantor to
creditors to the extent of the projects ongoing capital requirements. The guaranty agreement requires that
within 30 days of receiving a demand notice, the guarantors are required to pay to SunVesta AG that
amount required for ongoing capital requirements, until such time as financing of the project is secured.
The guaranty may not be terminated until such time as SunVesta AG has secured financing for the
completion of the project.
Forward-Looking Statements and Factors That May Affect Future Results and Financial Condition
The statements contained in the section titled Managements Discussion and Analysis of Financial
Condition and Results of Operations and elsewhere in this current report, with the exception of historical
facts, are forward-looking statements. We are ineligible to rely on the safe-harbor provision of the Private
Litigation Reform Act of 1995 for forward looking statements made in this current report. Forward-
looking statements reflect our current expectations and beliefs regarding our future results of operations,
performance, and achievements. These statements are subject to risks and uncertainties and are based
upon assumptions and beliefs that may or may not materialize. These statements include, but are not
limited to, statements concerning:
our anticipated financial performance and business plan;
the sufficiency of existing capital resources;
our ability to raise additional capital to fund cash requirements for future operations;
uncertainties related to our future business prospects;
our ability to generate revenues to fund future operations;
the volatility of the stock market; and
general economic conditions.
We wish to caution readers that our operating results are subject to various risks and uncertainties that
could cause our actual results to differ materially from those discussed or anticipated. We also wish to
advise readers not to place any undue reliance on the forward-looking statements contained in this report,
which reflect our beliefs and expectations only as of the filing date of this report. We assume no
obligation to update or revise these forward-looking statements to reflect new events or circumstances or
any changes in our beliefs or expectations, other than as required by law.
Recent Accounting Pronouncements
Please see Note 2 to the accompanying consolidated financial statements for recent accounting
pronouncements.
ITEM 3.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not applicable.
33
ITEM 4.
CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
In connection with the preparation of this quarterly report, an evaluation was carried out by the
Companys management, with the participation of the chief executive officer and chief financial officer,
of the effectiveness of the Companys disclosure controls and procedures (as defined in Rules 13a-15(e)
under the Securities Exchange Act of 1934 (Exchange Act)). Disclosure controls and procedures are
designed to ensure that information required to be disclosed in reports filed or submitted under the
Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the
Commissions rules and forms, and that such information is accumulated and communicated to
management, including the chief executive officer and chief financial officer, to allow timely decisions
regarding required disclosures.
Based on that evaluation, the Companys management concluded that due to a lack of independent
oversight, failure to segregate duties, insufficient accounting resources and lack of US GAAP knowledge,
as of the end of the period covered by this report, that the Companys disclosure controls and procedures
were ineffective in recording, processing, summarizing, and reporting information required to be
disclosed, within the time periods specified in the Commissions rules and forms, and such information
was not accumulated and communicated to management, including the chief executive officer and the
chief financial officer, to allow timely decisions regarding required disclosures.
Changes in Internal Control over Financial Reporting
During the period ended March 31, 2012, there has been no change in internal control over financial
reporting that has materially affected, or is reasonably likely to materially affect our internal control over
financial reporting.
34
PART II OTHER INFORMATION
ITEM 1.
LEGAL PROCEEDINGS
None.
ITEM 1A.
RISK FACTORS
Not required of smaller reporting companies.
ITEM 2.
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
None.
ITEM 3.
DEFAULTS ON SENIOR SECURITIES
None.
ITEM 4.
MINE SAFETY DISCLOSURES
Not applicable.
ITEM 5.
OTHER INFORMATION
None.
ITEM 6.
Exhibits required to be attached by Item 601 of Regulation S-K are listed in the Index to Exhibits on page
37 of this Form 10-Q, and are incorporated herein by this reference.
35
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.
SunVesta, Inc.
Date
/s/ Josef Mettler
April 15, 2013
Josef Mettler
Chief Executive Officer, Chief Financial Officer,
Principal Accounting Officer and Director
/s/ Hans Rigendinger
April 15, 2013
Hans Rigendinger
Chief Operating Officer and Director
36
INDEX TO EXHIBITS
Exhibit
Description
3.1.1*
Articles of Incorporation (incorporated by reference from the Form 10-SB filed with the Commission on
December 31, 1999).
3.1.2*
Amended Articles of Incorporation (incorporated by reference from the Form 10-KSB filed with the
Commission on April 9, 2003).
3.1.3*
Amended Articles of Incorporation (incorporated by reference from the Form 10-QSB filed with the
Commission on November 17, 2003).
3.1.4*
Amended Articles of Incorporation (incorporated by reference from the Form 8-K filed with the Commission
on September 27, 2007).
3.2.1*
Bylaws (incorporated by reference from the Form 10-SB filed with the Commission on December 31, 1999).
3.2.2*
Amended Bylaws (incorporated by reference from the Form 10-QSB filed with the Commission on
November 17, 2003).
10.1*
Securities Exchange Agreement and Plan of Exchange dated June 18, 2007 between the Company and
SunVesta AG (formerly ZAG Holdings AG) (incorporated by reference from the Form 8-K filed with the
Commission on June 21, 2007).
10.2*
Purchase and Sale Agreement between ZAG Holding AG and Trust Rich Land Investments, Mauricio Rivera
Lang dated May 1, 2006 for the acquisition of Rich Land Investments Limitada.
10.3*
Debt Settlement Agreement dated September 29, 2008 with Zypam Ltd. (incorporated by reference from the
Form 10-Q filed with the Commission on November 13, 2008).
10.4*
Debt Settlement Agreement dated April 21, 2009 between the Company and Zypam, Ltd. (incorporated by
reference from the Form 8-K filed with the Commission on April 30, 2009).
10.5*
Debt Settlement Agreement dated March 1, 2010 between the Company and Zypam, Ltd. (incorporated by
reference from the Form 8-K filed with the Commission on March 10, 2010).
10.6*
Debt Settlement Agreement dated March 1, 2010 between the Company and Hans Rigendinger (incorporated
by reference from the Form 8-K filed with the Commission on March 10, 2010).
10.7*
Employment Agreement dated January 1, 2001 between the SunVesta Projects & Management AG and Josef
Mettler (incorporated by reference from the Form 10-K filed with the Commission on February 14, 2013).
10.8*
Guaranty Agreement dated July 16, 2012 between SunVesta Holding AG, Josef Mettler, Hans Rigendinger
and Max Rössler (incorporated by reference from the Form 10-K filed with the Commission on February 14,
2013).
10.9*
Employment Agreement dated January 1, 2013 between the Company and Hans Rigendinger (incorporated
by reference to the Form 8-K filed with the Commission on February 4, 2013.
Debt Settlement between the Company and Hans Rigendinger dated December 31, 2012 (attached).
14*
Code of Ethics adopted March 1, 2004 (incorporated by reference from the 10-KSB filed with the
Commission on April 14, 2004).
21*
Subsidiaries of the Company (incorporated by reference from the Form 10-K filed with the Commission on
February 14, 2013).
Certification of the Chief Executive Officer and Chief Financial Officer pursuant to Rule 13a-14 of the
Securities and Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002 (attached).
Certification of the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350
as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (attached).
101. INS
XBRL Instance Document
101. PRE
XBRL Taxonomy Extension Presentation Linkbase
101. LAB
XBRL Taxonomy Extension Label Linkbase
101. DEF
XBRL Taxonomy Extension Label Linkbase
101. CAL
XBRL Taxonomy Extension Label Linkbase
101. SCH
XBRL Taxonomy Extension Schema
*
Incorporated by reference to previous filings of the Company.
Pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed furnished and not
filed or part of a registration statement or prospectus for purposes of Section 11 or 12 of the Securities
Act of 1933, or deemed furnished and not filed for purposes of Section 18 of the Securities and
Exchange Act of 1934, and otherwise is not subject to liability under these sections.
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