UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 for the quarterly period ended ~~September~~March 3031, ~~2017~~2018.

☐ 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 (State or other jurisdiction of incorporation or organization) 98-0211356 (I.R.S. Employer Identification No.)

Florida	98-0211356
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

Seestrasse 97, Oberrieden, Switzerland CH-8942

(Address of principal executive offices) (Zip Code)

+ 41 43 388 40 60

(Registrant’s 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 ☒ No ☐

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 ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company”, and “~~smaller reporting~~emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐ Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting company ☒ Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. The number of shares outstanding of the issuer’s common stock, $0.01 par value (the only class of voting stock), at ~~November~~May 10, 132018, ~~2017,~~ was ~~104~~107,~~741~~241,603.

TABLE OF CONTENTS

PART I – FINANCIAL INFORMATION	PAGE
	PAGE
Item 1. Financial Statements	3
PART I – FINANCIAL INFORMATION	3
Consolidated Balance Sheets as of September 30, 2017 (unaudited) and December 31, 2016	4
Item 1. Financial Statements
Unaudited Consolidated Statements of Comprehensive Loss for the three and nine months ended September 30, 2017 and September 30, 2016	5
Consolidated Balance Sheets as of March 31, 2018 (unaudited) and December 31, 2017	4
Unaudited Consolidated Statements of Stockholders, Equity for the nine months ended September 30, 2017	6
Unaudited Consolidated Statements of Comprehensive Loss for the three months ended March 31, 2018 and March 31, 2017	5
Unaudited Consolidated Statements of Cash Flows for the nine months ended September 30, 2017 and September 30, 2016	7
Unaudited Consolidated Statements of Stockholders, Equity for the three months ended March 31, 2018	6
Notes to Unaudited Consolidated Financial Statements	8
Unaudited Consolidated Statements of Cash Flows for the three months ended March 31, 2018 and March 31, 2017	7
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations	32
Notes to Unaudited Consolidated Financial Statements	9
Item 3. Quantitative and Qualitative Disclosures about Market Risk	40
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations	29
Item 4. Controls and Procedures	40
Item 3. Quantitative and Qualitative Disclosures about Market Risk	37
Item 4. Controls and Procedures	37
PART II – OTHER INFORMATION
Item 1. Legal Proceedings	4138
Item 1A. Risk Factors	4138
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	4138
Item 3. Defaults upon Senior Securities	4138
Item 4. Mine Safety Disclosures	4138
Item 5. Other Information	4138
Item 6. Exhibits	4138
Signatures	4239
Index to Exhibits	4340

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 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.

Due to rounding, the sum of individual positions may be higher or lower than 100%.

SUNVESTA, INC.

CONSOLIDATED BALANCE SHEETS

	September 30, 2017 (Unaudited)			December 31, 2016
	March 31, 2018			December 31, 2017
	(unaudited)			(audited)
Assets
Current assets
Cash and cash equivalents		4,~~553~~356,~~872~~184			~~806~~4,~~440~~058,982
Receivable from related parties		—			49,292
Other assets		861,872			772,182
Other assets		737,459			456,099
Total current assets	$	5,218,056			4,831,164
Total current assets	$	5,291,330			1,311,830
Non-current assets
Property and equipment - net		7379,~~053~~126,~~771~~023			6676,~~216~~423,~~658~~695
Deposits related to construction work		1664,~~069,477~~391			~~190~~851,~~549~~665
Notes receivable		—			280,242
Restricted cash		1,673,013			1,669,917
Restricted cash		1,670,164			1,667,052
Total non-current assets	$	81,463,426			78,945,277
Total non-current assets	$	75,793,412			68,354,502
Total assets	$	86,681,482			83,776,440
Total assets	$	81,084,743			69,666,332
Liabilities and stockholders' deficit
Current liabilities
Accounts payable		21,~~312~~388,~~044~~449			31,~~311~~796,~~512~~917
Accrued expenses		3,~~453~~946,~~700~~921			3,~~160~~083,~~723~~131
Note payable		—			1,500,000
Other liabilities		47,522			28,720
Notes payable to related parties		—			307,088
Convertible CHF-Bonds		11,382,794			11,032,145
Other liabilities		26,013			120
Liability related to conversion feature		629,373			922,087
Convertible CHF-Bonds		12,711,869			6,202,921
Provisions for liquidated damages		5,120,000			5,120,000
Liability related to conversion feature		1,334,210			—
Total current liabilities	$	22,515,058			21,983,000
EUR-Bond		—			484,463
Total current liabilities	$	19,837,836			14,966,826
Non-current liabilities
Convertible CHF-Bonds		—			31,892,613
CHF-Bonds		40,070,402			31,853,298
CHF-Bonds		30,087,541			16,384,893
Notes payable to related parties not subordinated		16,879,878			20,490,817
Liability related to conversion feature		—			5,936,378
Notes payable to related parties subordinated		82,628,834			79,339,011
Notes payable to related parties		93,153,232			51,473,793
Pension liabilities		215,036			210,031
Pension liabilities		192,947			184,469
Total non-current liabilities	$	139,794,150			131,893,157
Total non-current liabilities	$	123,433,720			105,872,146
Total liabilities	$	162,309,208			153,876,156
Total liabilities	$	143,271,556			120,838,972
Stockholders' deficit
Preferred stock, $0.01 par value; 50,000,000 shares authorized, no shares issued and outstanding		—			—
Common stock, $0.01 par value; 200,000,000 shares authorized; 101,841,603 shares issued and outstanding		1,018,416			959,416
Common stock, $0.01 par value; 200,000,000 shares authorized; 104,741,603 shares issued and outstanding		1,047,416			1,047,416
Additional paid-in capital		23,~~373~~407,~~567~~880			23,~~238~~404,~~526~~808
Accumulated other comprehensive income / (loss)		(561,389	)		2,997,562
Accumulated other comprehensive income/(loss)		(3,178,287	)		(769,600	)
Accumulated deficit		(8696,~~017~~904,~~407~~734	)		(7893,~~368~~782,~~143~~340	)
Total stockholders' deficit	$	(6275,~~186~~627,~~813~~726	)		(5170,~~172~~099,~~639~~716	)
Total liabilities and stockholders' deficit	$	8186,~~084~~681,~~743~~482			6983,~~666~~776,~~332~~440

The accompanying notes are an integral part of these unaudited consolidated financial statements.

SUNVESTA, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

	Three months ended						~~Nine months ended~~
	September 30, 2017			September 30, 2016			September 30, 2017			September 30, 2016
	March 31, 2018			March 31, 2017
	(Unaudited)			(Unaudited)			~~(Unaudited)~~			~~(Unaudited)~~
Revenues
Revenues, net		—			—			—			—
Cost of revenues		—			—			—			—
Gross profit	$	—			—			—			—
Operating expenses
General and administrative expenses		(1953,~~740,343~~502	)		(1,~~071~~375,~~827~~970	)		~~(4,253,599~~	)		~~(3,998,562~~	)
Impairment expenses		—			—(280,242	)		~~(280,242~~	)		~~(296,663~~	)
Total operating expenses	$	(1953,~~740,343~~502	)		(1,~~071~~656,~~827~~212	)		~~(4,533,841~~	)		~~(4,295,224~~	)
Loss from operations	$	(1,740,343	)		(1,071,827	)		(4,533,841	)		(4,295,224	)
Income/(loss) from operations	$	(953,502	)		(1,656,212	)
Other income/(expenses)
Interest income		2918,~~460~~310			1517,~~134~~170			~~60,309~~			~~46,162~~
Interest expense		(1,~~949~~853,~~695~~770	)		(1791,~~859,825~~303	)		~~(4,687,418~~	)		~~(4,799,665~~	)
Change in fair value of conversion feature		311,666			680,580			1,297,206			1,860,806
Change in Fair Value of Conversion Feature		316,366			662,601
Gain/loss on extinguishment of debt		(106,762	)		—			2,138,858			(1,071,317	)
Exchange differences		(968,684	)		(584,554	)
Exchange differences		790,470			(1,240,451	)		(1,749,921	)		322,882
Other income/(expenses)		268,646			(5,754	)
Other income/(expenses)		(22,811	)		(15,064	)		(88,018	)		(25,589	)
Total other expenses	$	(2,219,133	)		(701,840	)
Total other expenses	$	(947,672	)		(2,419,625	)		(3,028,985	)		(3,666,721	)
Loss before income taxes		(3,172,635	)		(2,358,053	)
Loss before income taxes		(2,688,015	)		(3,491,452	)		(7,562,826	)		(7,961,945	)
Income Taxes		—			—
Income Taxes		(1,305	)		—			(86,438	)		—
Net income/(loss)	$	(3,172,635	)		(2,358,053	)
Net loss	$	(2,689,320	)		(3,491,452	)		(7,649,265	)		(7,961,945	)
Comprehensive income/(loss)
Other comprehensive income/(loss)
Foreign currency translation		(2,408,688	)		(1,280,496	)
Foreign currency translation		1,479,171			119,460			(3,558,951	)		(2,702,023	)
Actuarial gains/(losses)		—			—
Actuarial gains/(losses)		—			—			—			—
Comprehensive income/(loss)	$	(5,581,323	)		(3,638,549	)
Comprehensive loss	$	(1,210,149	)		(3,371,991	)		(11,208,216	)		(10,663,968	)
Earnings/(loss) per common share
Loss per common share
Basic and diluted	$	(0.03	)		(0.02	)
Basic and diluted	$	(0.03	)		(0.03	)		(0.07	)		(0.08	)
Weighted average common shares
Weighted average common shares
Basic and diluted		107,241,603			108,234,104
Basic and diluted		104,741,603			101,740,479			105,905,770			99,707,537

The accompanying notes are an integral part of these unaudited consolidated financial statements.

SUNVESTA, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT

	~~Common Stock~~	Common Stock		~~Additional Paid-in Capital~~	Additional Paid-in Capital		~~Accumulated Other Comprehensive Loss~~	Accumulated Other Comprehensive Loss			~~Accumulated deficit~~	Accumulated deficit			~~Treasury Stock~~	Total Stockholders’ Deficit			~~Total Stockholders’ Deficit~~
December 31, 2016	$	959,416		$	23,238,526		$	2,997,562			$	(78,368,143	)		$	—			$	(51,172,639	)
January 1, 2018		$	1,047,416		$	23,404,808		$	(769,600	)		$	(93,782,340	)		$	(70,099,716	)
Translation adjustments		—	—		—	—		~~(3,558,951~~	)(2,408,688	)		—	50,241			—	(2,358,447	)		~~(3,558,951~~	)
Net loss		—	—		—	—		—	—			~~(7,649,264~~	)(3,172,635	)		—	(3,172,635	)		~~(7,649,264~~	)
Stock based compensation expense		59,000			135,041			—				—				—				194,041
Actuarial gains/(losses)			—			—			—				—				—
September 30, 2017	$	1,018,416		$	23,373,567		$	(561,389	)		$	(86,017,407	)		$	—			$	(62,186,814	)
Stock based compensation expense			—			3,072			—				—				3,072
March 31, 2018		$	1,047,416		$	23,407,880		$	(3,178,287	)		$	(96,904,734	)		$	(75,627,727	)

The accompanying notes are an integral part of these unaudited consolidated financial statements.

SUNVESTA, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

	January 1 to September 30, 2017			January 1 to September 30, 2016
	January 1 to March 31, 2018			January 1 to March 31, 2017 (restated)
	(Unaudited)			(Unaudited)
Cash flows from operating activities
Net loss	$	(73,~~649~~172,~~264~~635	)		(72,~~961~~358,~~945~~052	)
Adjustments to reconcile net loss to net cash
Depreciation and amortization		~~29,880~~52			2910,~~585~~024
Impairment expenses		~~269,695~~—			~~296~~269,~~663~~695
Amortization of debt issuance costs and commissions		1,236,543			1,776,231
Amortization of debt issuance costs, commissions and discounts		205,286			374,094
Accrued interest on debt		31,~~716~~807,~~523~~298			2987,~~696,792~~398
Extinguishment of debt		~~(2,138,858~~—	)		~~1,071,317~~—
Unrealized exchange differences		1971,~~766,165~~190			~~(411~~604,~~374~~839	)
Stock compensation expense		~~194~~3,~~041~~072			~~(235~~271,~~153~~030	)
Other income related to conversion feature		(1,337,364	)		(1,457,502	)
Capitalised interest on construction in process		(910,908	)		(934,955	)
- Cash flow impact of increase / decrease in:
Other income related to conversion feature		(316,366	)		(702,758	)
Other current assets		(526,401	)		759,303
Cash flow impact of increase / decrease in:
Accounts payable		(1,271,338	)		(3,042,107	)
Other assets		(73,614	)		(170,509	)
Accrued expenses		(2,762,378	)		424,203
Accounts payable		(444,625	)		(1,262,470	)
Other liabilities		25,524			—
Accrued expenses		807,401			(399,695	)
Net cash used in operating activities	$	(8,447,232	)		(6,053,988	)
Other liabilities		18,214			1,529
Net cash used in operating activities	$	(1,105,636	)		(3,309,830	)
Cash flow from investing activities
Payments to acquire property, plant and equipment		(21,~~768~~604,~~445~~184	)		(1628,~~198,012~~668	)
Proceeds from sale of property, plant and equipment		~~32,260~~—			3632,~~578~~260
Deposits related to construction work		(878,903	)		(641,818	)
Net cash used in investing activities	$	(1,604,184	)		(596,408	)
Down payments for property and equipment		—			309,023
Restricted cash		2,549			14,050
Net cash used in investing activities	$	(3,612,539	)		(1,480,178	)
Cash flows from financing activities
Repayments of bank liabilities		—			(178,053	)
Proceeds from notes payable related parties		2,923,745			7,027,584
Proceeds from notes payable related parties		17,794,570			8,233,385
Proceeds from bond issuance, net of commissions and debt issuance costs		(1,055	)		908,705
Repayment of notes payable related parties		—			(7,784,216	)
Repayment of bonds		—			(2,305,714	)
Proceeds from bond issuance, net of commissions and debt issuance costs		1,275,655			11,127,996
Proceeds from note payable and other debt		—			525,055
Repayment of bonds		(2,305,714	)		(890,379	)
Repayments of note payable and other debt		—			(500,000	)
Proceeds from note payable and other debt		525,055			(23,090	)
Net cash provided by financing activities	$	2,922,691			5,655,631
Repayments of note payable and other debt		(1,500,000	)		(102,679	)
Effect of exchange rate changes		87,427			3,360
Net cash provided by financing activities	$	15,789,566			10,382,963
Net increase / - decrase in cash		300,298			1,752,753
Effect of exchange rate changes		17,637			25,070
Cash and cash equivalents incl. restricted cash, beginning of period		5,728,898			2,473,492
Net increase / - decrase in cash		3,747,431			2,873,867
Cash and cash equivalents incl. restricted cash, end of period	$	6,029,197			4,226,245
Cash and cash equivalents, beginning of period		806,440			111,830
Additional information		January 1 to March 31, 2018			January 1 to March 31, 2017
Cash and cash equivalents, end of period	$	4,553,871			2,985,697
Increase of CHF Bond III by debiting loan due to Global Care AG (non-cash)		7,381,864			—
Additional information
Interest paid		—			—
Capitalized interest and debt issuance costs for construction (non-cash)		2,976,526			2,679,526
Transfer of Convertible CHF-Bond II to CHF-Bond IV (non-cash)		26,138,355			—
Transfer of Convertible CHF-Bond II to notes payable to Global Care AG (non-cash)		1,035,894			—
Transfer of CHF Bond III original to notes payable to Global Care AG (non-cash)		15,375,505			—
Assumption of payables due from AIRES by Global Care AG (non-cash)		—			7,621,345
Assumption of payables due from AIRES by Sportiva (non-cash)		—			1,533,150
Reversal of capitalized payment obligations for constructions (non-cash)					451,816
Interest paid		1,405,175			—

The accompanying notes are an integral part of these unaudited consolidated financial statements.

SUNVESTA, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

~~September~~MARCH 3031, ~~2017~~2018

1. Corporate Information

On August 27, 2007, SunVesta Inc. (“Company”) acquired SunVesta Holding AG (“SunVesta AG”). SunVesta AG has three wholly-owned subsidiaries: SunVesta Projects and Management AG, a Swiss company; SunVesta Costa Rica SA, a Costa Rican company and SunVesta Holding España SL, a Spanish company.

The Company is focused on the development of a holiday resort in Costa Rica. Planning for this project has been fully completed, all but one of the required consents have been granted, and excavation work ~~began~~is innear ~~March 2013~~completion. The Company is in the process of securing financing for the project and has not realized revenue to date. Since the financing of the project is not complete, the Company’s ~~activities~~ activities are subject to significant risks and uncertainties.

These consolidated financial statements are prepared in US Dollars on the basis of generally accepted accounting principles in the United States of America (“US GAAP”).

2. Significant Accounting Policies

New accounting standards – not adopted

In January 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update 2016-01, Financial Instruments—Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. The update requires several changes with respect to recognition and measurement as well as disclosure requirements with respect to financial instruments). The amendments to (ASU) 2016-01 are effective for the annual period ending after December 15, 2017, and for annual periods and interim periods thereafter. Early application is permitted. The Company has concluded that (ASU) 2016-01 will not have an impact on its consolidated results of operations, financial condition, cash flows, and financial statement disclosures.

In February 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update 2016-02, Leases (Topic 842). The standard requires the recognition of lease assets and lease liabilities by lessees for those leases classified as operating leases. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition. The standard requires lessors to classify leases as either sales-type, finance or operating. A sales-type lease occurs if the lessor transfers all of the risks and rewards, as well as control of the underlying asset, to the lessee. If risks and rewards are conveyed without the transfer of control, the lease is treated as a financing lease. If the lessor does not convey risks and rewards or control, an operating lease results. The standard will become effective for the Company beginning January 1, 2019. The Company is currently assessing the impact adoption of this standard will have on its consolidated results of operations, financial condition, cash flows, and financial statement disclosures.

In June 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Updates ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, requiring certain changes to the recognition and measurement as well as disclosure of incurred and expected credit losses. The standard will become effective for the Company beginning January 1, 2020. The Company is currently assessing the impact adoption of this standard will have on its consolidated results of operations, financial condition, cash flows, and financial statement disclosures.

SUNVESTA, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

~~September 30~~MARCH 31, ~~2017~~2018

2. SIGNIFICANT ACCOUNTING POLICIES - CONTINUED

New accounting standards – not adopted

In November 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Updates ASU 2016-18, requiring that restricted cash and restricted cash equivalents be included with cash and cash equivalents when reconciling the beginning-of-period and end-of- period total cash amounts shown on the statement of cash flows. Consequently, transfers between cash and restricted cash will not be presented as a separate line item in the operating, investing or financing sections of the cash flow statement. The amendments are effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The Company considers that ASU 2016-18 will have a limited impact on the presentation of the statement of cash flows.

In March 2017, the Financial Accounting Standards Board (FASB) issued Accounting Standards Updates ASU 2017-07, requiring certain changes to the presentation of the expenses related to postretirement benefits accounted for under Topic 715. The amendments are effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The Company is currently assessing the impact adoption of this standard will have on its consolidated results of operations, financial condition, cash flows, and financial statement disclosures.

In May 2017, the Financial Accounting Standards Board (FASB) issued Accounting Standards Updates ASU 2017-09, requiring certain changes to the presentation and disclosures of changes to share-based payment awards under Topic 718. The amendments are effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The Company is currently assessing the impact adoption of this standard will have on its consolidated results of operations, financial condition, cash flows, and financial statement disclosures.

In July 2017, the Financial Accounting Standards Board (FASB) issued Accounting Standards Updates ASU 2017-11, requiring certain changes to the presentation and disclosures of changes to liability or equity classification of financial instruments. The amendments are effective for public business entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. The Company is currently assessing the impact adoption of this standard will have on its consolidated results of operations, financial condition, cash flows, and financial statement disclosures.

New accounting standard updates - adopted

In August 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Updates ASU 2016-15, requiring that cash payments for debt prepayment or other debt extinguishment costs, including third-party costs, premiums paid, and other fees paid to lenders that are directly related to the debt prepayment or extinguishment, be classified as financing activities in the statement of cash flows. The amendments are effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The Company considers that ASU 2017-07 has had no material impact on the financial statements.

In November 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Updates ASU 2016-18, requiring that restricted cash and restricted cash equivalents be included with cash and cash equivalents when reconciling the beginning-of-period and end-of- period total cash amounts shown on the statement of cash flows. Consequently, transfers between cash and restricted cash is not presented as a separate line item in the operating, investing or financing sections of the cash flow statement. The amendments were effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The Company considers that ASU 2016-18 has had only a limited impact on the presentation of the statement of cash flows.

In March 2017, the Financial Accounting Standards Board (FASB) issued Accounting Standards Updates ASU 2017-07, requiring certain changes to the presentation of the expenses related to postretirement benefits accounted for under Topic 715. The amendments are effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The Company considers that ASU 2017-07 has had no material impact on the financial statements.

In May 2017, the Financial Accounting Standards Board (FASB) issued Accounting Standards Updates ASU 2017-09, requiring certain changes to the presentation and disclosures of changes to share-based payment awards under Topic 718. The amendments are effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The Company considers that ASU 2017-09 has had no material impact on the financial statements.

SUNVESTA, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

~~September 30~~MARCH 31, ~~2017~~2018

23. ~~SIGNIFICANT~~GOING ~~ACCOUNTING POLICIES - CONTINUED~~CONCERN

~~New~~The ~~accounting~~Company ~~standard~~is ~~updates~~in the process of developing a hotel project in the Papagayo Gulf Tourism Project area of Guanacaste, Costa Rica. The project is expected to open mid-2020. ~~adopted~~Until the completion of the project, the following expenditures are estimated to be incurred:

In August 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Updates (ASU) 2014-15 requiring an entity’s management to evaluate whether there are conditions or events, considered in aggregate, that raise substantial doubt about entity’s ability to continue as a going concern within one year after the date that the financial statements are issued (or within one year after the date that the financial statements are available to be issued when applicable). The amendments to (ASU) 2014-15 are effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. The Company has assessed that ASU 2014-15 has no effect on its financial statements, as a note with respect to the going concern assumption is already presented.

a.	Gross project cost	$	240,000,000
b.	Less: Proceeds from sale of villas		(25,000,000	)
c.	Net project cost		215,000,000
d.	Overhead expenses		20,000,000
e.	Total, excluding other potential projects	$	235,000,000

InSixty ~~March~~to ~~2016,~~seventy ~~the~~percent ~~Financial~~of ~~Accounting~~the ~~Standards~~net ~~Board~~project ~~(FASB)~~cost ~~issued~~is ~~Accounting~~intended ~~Standards~~to ~~Updates~~be ~~ASU~~financed ~~2016-9,~~through ~~Compensation—Stock Compensation~~the ~~(Topic~~issuance ~~718):~~of ~~Improvements~~secured todebt ~~Employee Share-Based Payment Accounting~~facilities, ~~requiring~~for ~~certain changes to recognition and~~which ~~measurement~~negotiations asare ~~well~~in ~~as disclosure of Share-Based Payments~~progress. The ~~standard~~remaining ~~will~~thirty ~~become~~to ~~effective~~forty ~~for~~percent of the ~~Company~~net ~~beginning~~project ~~January 1~~cost, ~~2017.~~as ~~The~~well ~~Company~~as ~~has~~non-recuperated ~~assessed~~overhead expenses ~~the~~are ~~impact~~intended ~~that~~to ~~adoption~~be offinanced ~~this~~by ~~standard~~the ~~has~~main onshareholders ~~its~~or ~~consolidated~~lenders ~~results~~ of ~~operations,~~the ~~financial condition~~project, ~~cash flows, and financial statement disclosures~~i.e ~~ASU~~Hans ~~2016-9~~Rigendinger, isshareholder, ~~part~~Company Director ~~of the FASB’s simplification initiative~~ and ~~offers~~ ~~certain~~Chief ~~accounting~~Executive ~~policy~~Officer, ~~choices~~ and ~~simplifications~~Dr. ~~Based~~Max onRӧssler, ~~the~~controlling ~~current~~shareholder ~~stock~~of ~~option~~Aires ~~plans,~~International ~~there~~Investment ~~is no effect from~~Inc. ~~ASU~~and ~~2016-9~~Global onCare ~~the Company’s consolidated results of operations~~AG, ~~financial~~as ~~condition,~~well ~~cash~~as ~~flows,~~a ~~and~~Company ~~financial statement disclosures~~Director.

On July 16, 2012, certain principal shareholders of the Company or principal lenders to the project entered into a Guaranty Agreement in favor of the Company. The purpose of the guaranty is to ensure that until such time as financing is secured for the entire project that each will act as guarantors to creditors of SunVesta Holding AG.

The Guaranty Agreement requires that within 30 days of receiving a demand notice, requested funds are made available by the guarantors to the Company. Based on this guaranty, management believes that available funds are sufficient to finance cash flows for the twelve months subsequent to March 31, 2018, and the filing date, though future anticipated cash outflows for investing activities are dependent on the availability of financing.

On September 22, 2015, the signatories to the guaranty formally agreed to maintain the guaranty, as necessary, until December 31, 2018.

On October 28, 2016, Hans Rigendinger and Dr. Max Rössler formally agreed to maintain the guaranty, as necessary, until completion of the construction of Paradisus Papagayo Bay Resort & Luxury Villas, after which date the guaranty will expire.

SUNVESTA, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

~~September 30~~MARCH 31, ~~2017~~2018

3. GOING CONCERN

The Company is currently working on building a holiday resort in the Papagayo Gulf Tourism Project area of Guanacaste, Costa Rica. The project is not expected to open before the end of 2018. Until the completion of the project, the following expenditures are estimated to be incurred:

a.	Gross project cost	$	242,000,000
b.	Less: Proceeds from sale of villas		(25,000,000	)
c.	Net project cost		217,000,000
d.	Overhead expenses		20,000,000
e.	Total, excluding other potential projects	$	237,000,000

Seventy percent of the net project cost is intended to be financed through the issuance of secured debt facilities, for which negotiations are in progress. The remaining thirty percent of the net project cost, as well as non-recuperated overhead expenses are intended to be financed by the main shareholders or lenders of the project, i.e Dr. Hans Rigendinger, shareholder, Company Director and Chief Executive Officer, and Dr. Max Rӧssler, controlling shareholder of Aires International Investment Inc. and Global Care AG as well as Company Director.

On July 16, 2012, certain principal shareholders of the Company or principal lenders to the project entered into a Guaranty Agreement in favor of the Company. The purpose of the guaranty is to ensure that until such time as financing is secured for the entire project that they will act as guarantors to creditors of SunVesta Holding AG.

On September 22, 2015, the signatories to the guaranty formally agreed to maintain the guaranty, as necessary, until December 31, 2018.

On October 28, 2016, Dr. Hans Rigendinger and Dr. Max Rössler formally agreed to maintain the guaranty, as necessary, until completion of the construction of Paradisus Papagayo Bay Resort & Luxury Villas, after which date the guaranty will expire.

4. CASH AND CASH EQUIVALENTS

Cash and cash equivalents are available to the Company without any restriction or limitation on withdrawal and/or use of these funds. The Company’s cash equivalents are placed with financial institutions that maintain high credit ratings. The carrying amounts of these assets approximate their fair value.

Cash and cash equivalents

USD

CHF

Other

Total

September 30, 2017

December 31, 2016

March 31, 2018

December 31, 2017

original currency

41,~~600~~341

4,~~419~~138,~~670~~792

12,~~905~~742

in $

41,~~600~~341

4,~~535~~341,~~977~~406

13,~~295~~437

4,~~553~~356,~~872~~184

~~806~~4,~~440~~058,982

USD ($) = US Dollar ~~CHF = Swiss Francs Other = Australian Dollar and Costa Rican Colón~~

CHF = Swiss Francs

5. RESTRICTED CASH

As of March 31, 2018, the Company has the following restricted cash positions:

	March 31, 2018		December 31, 2017
	$		$
Credit Suisse in favor of BVK pension fund		133,910		130,814
Banco Lafise in favor of the Costa Rican Tourism Board		933,350		933,350
Banco Lafise in favor Costa Rican Environmental Agency – SETANA		605,753		605,753
Gross		1,673,013		1,669,917

Restricted cash positions in favor of Costa Rican Tourism Board and Costa Rican Environmental Agency – SETANA are related to the hotel project in Costa Rica and therefore their release is not expected before finalization of the corresponding project.

The restricted cash position in favor of BVK pension fund is a rental deposit related to a long term lease contract for office space (the contract ends as of December 31, 2018, but will most likely be prolonged). Due to this fact this restricted cash position is classified as long term.

SUNVESTA, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

~~September 30~~MARCH 31, ~~2017~~2018

56. ~~RESTRICTED~~PROPERTY ~~CASH~~& EQUIPMENT

As of September 30, 2017, the Company has the following restricted cash positions:

	March 31, 2018			December 31, 2017
Concession Land	$	19,700,000			19,700,000
IT Equipment		236,320			230,820
Other equipment and furniture		236,303			230,836
Leasehold improvements		79,112			77,271
Construction in-process		59,425,113			56,722,733
Gross		79,676,848			76,961,659
Less accumulated depreciation		(550,825	)		(537,965	)
Net	$	79,126,022			76,423,694
Depreciation expenses for the period ended March 31, 2018 and December 2017		53			39,562

	September 30, 2017		December 31, 2016
	$		$
Credit Suisse in favor of BVK pension fund		131,061		125,400
Banco Lafise in favor of the Costa Rican Tourism Board		933,350		933,350
Banco Lafise in favor Costa Rican Environmental Agency – SETENA		605,753		608,302
Gross		1,670,164		1,667,052

Property and equipment is comprised primarily of land in Costa Rica and capitalized project costs incurred as of period end in connection with the Papagayo Gulf Tourism project. The land amounts to $19.7 million comprised of $7 million related to the concession formerly held by Rich Land (~84,000 m2) and $12.7 million formerly held by AdR (~120,000 m2).

~~Restricted~~The ~~cash~~$7 ~~positions~~million inconcession ~~favor~~is ofa ~~Costa~~right ~~Rican~~to ~~Tourism~~use ~~Board~~the ~~and~~property ~~Costa~~for ~~Rican~~a ~~Environmental~~specific ~~Agency~~period –of ~~SETANA~~time ~~are~~of ~~related~~initially to20 ~~the~~years ~~hotel project~~from inthe ~~Costa~~date ~~Rica~~of ~~and~~grant, which ~~therefore~~thereafter ~~their~~can ~~release~~be isrenewed ~~not~~at ~~expected~~no ~~before~~further ~~finalization~~cost, ofif the ~~corresponding~~landholder ~~project.~~is ~~Due~~up to ~~this fact~~date ~~these~~with ~~restricted~~its ~~cash~~obligations ~~positions~~and ~~have~~if ~~been~~there ~~classified~~is asno ~~long~~significant change ~~term. The restricted cash position~~ in ~~favor~~government ofpolicies. ~~BVK~~The ~~pension~~current ~~fund is~~concession awas ~~rental~~initially ~~deposit~~set ~~related~~ to aexpire ~~long~~in ~~term~~June ~~lease contract for office space~~2022.

6The $12.7 million concession is also a right to use the property for a specific period of time of initially 30 years from the date ~~NOTE~~of ~~RECEIVABLE~~grant, which thereafter can be renewed at no further cost, if the landholder is up to date with its obligations and if there is no significant change in government policies. The current concession was initially set to expire in November 2036.

On ~~June~~July 1514, 2015, the ~~Company~~Consejo ~~loaned~~del ~~REP~~Polo ~~Caribbean~~de ~~Development~~DesarrolloTuristico ~~Corporation~~Papagayo ~~(“REP~~at ~~Caribbean”),~~ICT a(Council ~~third party, $250,000 secured by a non-related Swiss individual. The loan was due on November 30, 2015, in addition to a fixed interest payment~~ of ~~$5,000. On~~Papagayo ~~September~~Tourism ~~15,~~Development ~~2015~~Project), ~~the Company entered into an agreement with REP Caribbean and 4f Capital, a related party, netting receivables~~ ~~due~~unanimously toapproved the ~~respective~~extension ~~parties that resulted in the satisfaction~~ of ~~the~~both ~~full~~concessions ~~loan~~until ~~amount due from REP Caribbean to the Company and a receivable against 4f Capital in the amount of approximately $250,000 as of December 31, 2016 and $250,000 as of December 31, 2015~~2052. On December 10, 2015, the Company loaned an additional unsecured amount of $25,000 to REP Caribbean. The Company erroneously reported as of December 31, 2016 and December 31, 2015, that the amount due from REP Caribbean was approximately $280,000. Since 4f Capital is in liquidation, and the likelihood that REP Caribbean will repay the unsecured $25,000 due is in doubt, the receivable erroneously reported as approximately $280,000, was fully impaired as of March 31, 2017.

7.The ~~PROPERTY~~construction &in ~~EQUIPMENT~~process through March 31, 2018 and December 31, 2017, is represented primarily by architectural work related to the Papagayo Gulf Tourism project as well as excavation and infrastructure work.

	September 30, 2017			December 31, 2016
Concession Land	$	19,700,000			19,700,000
IT Equipment		231,220			221,060
Other equipment and furniture		231,233			219,734
Leasehold improvements		77,405			74,004
Vehicles		—			74,000
Construction in-process		53,343,006			46,457,172
Gross		73,582,864			66,745,970
Less accumulated depreciation		(529,093	)		(529,312	)
Net	$	73,053,771			66,216,658
Depreciation expenses for the period ended September 30, 2017 and December 2016		29,880			61,771

Deposit related to construction work

The Company placed deposits with contractors for excavation and infrastructure work to be offset against invoices as work is completed. As of March 31, 2018 and December 31, 2017, the Company has deposits of $664,391 and $851,665 respectively, which have not yet been set off.

SUNVESTA, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

~~September 30~~MARCH 31, ~~2017~~2018

7. FAIR ~~PROPERTY~~VALUE ~~& EQUIPMENT – CONTINUED~~MEASUREMENT

Concession Properties

Property and equipment is comprised of concession land held in Costa Rica that is being developed for a hotel, planning expenses, earth works and capitalized project costs in connection with the Papagayo Gulf Tourism project. The concession land amounts to $19.7 million related to the concessions held by SunVesta Costa Rica SA. $7 million (~94,000 m2) and $12.7 million (~133,000 m2).

The $7 million concession is a right to use the property for a specific period of time of initially 20 years from the date of grant, which thereafter can be renewed at no further cost, if the landholder is up to date with its obligations and if there is no significant change in government policies. The current concession was to expire in June 2022.

The $12.7 million concession is also a right to use the property for a specific period of time of initially 30 years from the date of grant, which thereafter can be renewed at no further cost, if the landholder is up to date with its obligations and if there is no significant change in government policies. The current concession was to expire in November 2036.

On July 14, 2015 the Consejo del Polo de DesarrolloTuristico Papagayo at ICT (Council of Papagayo Tourism Development Project), unanimously approved the extension of both concessions until 2052.

Additional Properties

On April 24, 2013, the Company entered into a new agreement to purchase two additional concession properties located in Polo Papagayo, Guanacaste for a total of $17,500,000 payable to the seller and a third party against a refundable deposit of $1,369,816 payable over terms minus $300,000 in liqudated damages of 5% in the event the purchase did not close. The Company failed to perform according to the terms of the purchase agreement and the transaction was terminated by the third party and thereafter by the Company.

The Company initiated legal proceedings against the seller and separately the third party for the recovery of that portion of the refundable deposits paid to the seller and to the third party. The aggregate amount in dispute was approximately $1.5 million. The legal proceeding againt the seller has since been dismissed on technical grounds and the legal proceeding against the third party has been withdrawn by the Company on contractual grounds. The Company is assessing whether to file a new complaint against the seller.

As of September 30, 2017, no gain has been recognized with respect to the claims against the seller and the third party in connection with the additional concession properties.

All expenses related to the agreements with the seller and the agreement with the third party seller, were impaired as of December 31, 2016.

Deposit related to construction work

The Company placed deposits with contractors for earth moving groundwork and infrastructure work. These deposits will be offset against invoices as such works is completed. As of September 30, 2017 and December 31, 2016, the Company has deposits of $1,069,477 and $190,549 respectively, which have not yet been set off.

SUNVESTA, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2017

8. 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 process 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 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.

Level 1 Quoted prices for identical instruments in active markets.

Level 2 Quoted process 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 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, the Company uses quoted market prices to determine fair value, and classifies such measurements within Level 1. In some cases, where market prices are not available, the Company makes 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 counterparty or the Company) 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), the Company’s fair value calculations have been adjusted accordingly.

As of ~~September~~March 3031, ~~2017~~2018 and December 31, ~~2016~~2017, respectively, there are no financial assets or liabilities measured on a recurring ~~basis~~ basis at fair value with the exception of the liability related to the conversion feature.

SUNVESTA, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2018

7. FAIR VALUE MEASUREMENT – CONTINUED

In addition to the methods and assumptions to record the fair value of financial instruments as discussed above, the Company used the following methods and assumptions to estimate the fair value of our financial instruments:

—	Cash and cash equivalents – carrying amount approximated fair value.
—	Restricted cash – carrying amount approximated fair value.
—	Accounts payable – carrying amount approximated fair value.
—	Notes receivable - carrying amount approximated fair value.
—	CHF-bonds – 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 6.5% respectively for CHF bonds, which represented the current market rate based on the creditworthiness of the Company at issuance. Hence, the carrying values approximate fair value.
—	Notes payable to related parties – Aires and Global Care (non-current) – The fair values of the notes payable to Aires International Investments Inc. and Global Care AG are classified as Level 3. 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 creditworthiness of the Company. Hence, the carrying value approximates fair value.
—	Convertible CHF-bonds – The fair values of the convertible bonds payable are classified as Level 3 fair values. The fair values of the convertible bonds have been determined by discounting cash flow projections discounted at the respective interest rates of 6.00% for convertible CHF bonds, which represents the current market rate based on the creditworthiness of the Company. Hence, the carrying values approximate fair value.
—	Liability related to conversion feature - The fair value of the liability related to conversion feature is classified as Level 3 in the fair value hierarchy. The fair value of the liability is determined using a Black Scholes model to calculate the option value at each reporting date and multiplied by the number of potentially convertible shares.

SUNVESTA, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

~~September 30~~MARCH 31, ~~2017~~2018

8 7. FAIR VALUE MEASUREMENT – CONTINUED

— Cash and cash equivalents – carrying amount approximated fair value. — Restricted cash – carrying amount approximated fair value. — Receivables from related parties (current) – carrying amount approximated fair value due to the short term nature of the receivables. — Accounts payable – carrying amount approximated fair value. — Note payable – carrying amount approximated fair value due to the short term nature of the note payable. — Notes receivable - carrying amount approximated fair value. — Notes payable to related parties – (current) – carrying amount approximated fair value due to the short term nature of the notes payable. — EUR– bond (old) – carrying amount approximated fair value due to its short term nature — EUR- bonds – 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 EUR bonds, which represents the current market rate based on the creditworthiness of the Company. Hence, the carrying values approximate fair value. ~~— CHF-bonds – The fair values~~ of ~~the~~our ~~bonds~~financial ~~payable~~instruments 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% or 6.5% respectively for CHF bonds, which represented the current market rate based on the creditworthiness of the Company at issuance. Hence, the carrying values approximate fair value. — Notes payable to related parties – Aires and Global Care (non-current) – The fair values of the notes payable to Aires International Investments Inc. and Global Care AG are classified as level 3. 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 creditworthiness of the Company. Hence, the carrying value approximates fair value. — Convertible CHF-bonds – The fair values of the convertible bonds payable are classified as level 3 fair values. The fair values of the convertible bonds have been determined by discounting cash flow projections discounted at the respective interest rates of 6.00% for convertible CHF bonds, which represents the current market rate based on the creditworthiness of the Company. Hence, the carrying values approximate fair value. — Liability related to conversion feature - The fair value of the liability related to conversion feature is ~~classified~~presented ~~as level 3~~ in the ~~fair~~table value hierarchy. The fair value of the liability is determined using a Black Scholes model to calculate the option value at each reporting date and multiplied by the number of potentially convertible shares.below:

	March 31, 2018				December 31, 2017
	Carrying Amount $		Fair Value $		Carrying Amount $		Fair Value $		Fair Value Levels		Reference
Cash and cash equivalents		4,356,184		4,356,184		4,058,982		4,058,982		1		Note 4
Restricted cash		1,673,013		1,673,013		1,669,917		1,669,917		1		Note 5
Accounts Payable		1,388,449		1,388,449		1,796,917		1,796,917		1		—
Convertible CHF-bonds		11,382,794		11,382,794		11,032,145		11,032,145		3		Note 9
CHF-bonds		40,070,402		40,070,402		31,853,298		31,853,298		3		Note 9
Notes payable to related parties (non-current)		99,508,712		99,508,712		99,829,827		99,829,827		3		Note 8
Liability related to conversion feature		629,373		629,373		922,087		922,087		3		Note 7

The Company’s financial liabilities measured at fair value on a recurring basis consisted of the liability related to conversion feature as of the following date:

Balance at December 31, 2017	922,087
Additions/(Decrease)	—
Change in Fair Value of Conversion Feature	(316,366	)
(Gain)/loss on extinguishment of debt (in addition to any recognized gain/loss on extinguishment of the underlying financial instrument)	—
FX Revaluation	23,652
Balance at March 31, 2018	629,373

Total income related to the conversion feature in the three months up to March 31, 2018, amounts to $629,373. The Company used a Black-Scholes model to value the liability related to conversion feature as of March 31, 2018, and December 31, 2017. Decrease of the conversion feature due to a decrease of bond volume are accounted for within interest expense.

The assumptions as of March 31, 2018 are as follows:

Stock Price: CHF 5.08	Annualized Risk Free Rate: 0.001%
Exercise Price: CHF 8	Annualized Volatility: 80%
Time to Maturity: 0.50 years

The assumptions as of December 31, 2017 are as follows:

Stock Price: CHF 5.08	Annualized Risk Free Rate: 0.001%
Exercise Price: CHF 8	Annualized Volatility: 80%
Time to Maturity: 0.75 years

SUNVESTA, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

~~September 30~~MARCH 31, ~~2017~~2018

8. RELATED ~~FAIR~~PARTY ~~VALUE MEASUREMENT – CONTINUED~~TRANSACTIONS

The ~~fair~~advances ~~value~~from of(to) ~~our~~related ~~financial~~parties ~~instruments~~are iscomposed ~~presented~~as ~~in the table below~~follows:

		September 30, 2017						December 31, 2016
			Receivables						Payables
		Carrying Amount $			Fair Value $			Carrying Amount $			Fair Value $			Fair Value Levels		Ref-erence
			March 31, 2018			December 31, 2017			March 31, 2018			December 31, 2017
Cash and cash equivalents			4,553,872			4,553,872			806,440			806,440			1		Note 4
1a	Aires International subordinated			—			—			59,982,381			57,613,418
Restricted cash			1,670,164			1,670,164			1,667,052			1,667,052			1		Note 5
2a	Global Care AG subordinated			—			—			22,646,453			21,725,592
Receivables from related parties – other (current)			—			—			49,292			49,292			3		Note 9
2b	Global Care AG not subordinated			—			—			16,879,878			20,490,817
Accounts Payable			2,312,044			2,312,044			3,311,512			3,311,512			1		—
	Total			—			—			99,508,712			99,829,827
Note payable			—			—			1,500,000			1,500,000			1		Note 15
	of which non-current			—			—			99,508,712			99,829,827
Notes payable to related parties – other (current)			—			—			307,088			307,088			3		Note 9
	- therof suboridinated									82,628,834			79,339,011
Notes receivable			—			—			280,242			280,242			3		Note 6
	- therof not suboridinated									16,879,878			20,490,817
EUR-bonds			—			—			484,463			484,463			3		Note 10
Convertible CHF-bonds			12,711,869			12,711,869			38,095,533			38,095,533			3		Note 10
CHF-bonds			30,087,541			30,087,541			16,384,893			16,384,893			3		Note 10
Notes payable to related parties (non-current)			93,153,232			93,153,232			51,473,793			51,473,793			3		Note 9
Liability related to conversion feature			1,334,210			1,334,210			—			—			3		Note 10

~~The~~Additional ~~Company,s~~Details ~~financial liabilities measured at fair value~~ on ~~a recurring basis consisted of~~ the ~~liability~~Loan ~~related~~due to ~~conversion~~Aires ~~feature as~~International ofInvestment ~~the following date:~~Inc.

Balance at December 31, 2016	5,936,378
Additions/(Decrease)	(40,158	)
Change in Fair Value of Conversion Feature	(1,297,206	)
Gain/loss on extinguishment of debt (in addition to any recognized gain/loss on extinguishment of the underlying financial instrument)	(3,466,897	)
FX Revaluation	202,093
Balance at September 30, 2017	1,334,210

As of March 31, 2018, the Company owed Aires International Inc. the following:

Total income related to the conversion feature including the gain on the extinguishment of debt in the nine months up to September 30, 2017, amounts to $4,804,261. The Company used a Black-Scholes model to value the liability related to conversion feature as of September 30, 2017 and December 31, 2016. Decrease of the conversion feature due to a decrease of bond volume are accounted for within interest expense. In the consolidated statement of comprehensive loss, an amount of $3,466,897 has been reclassed from impact of the conversion feature to gain on extinguishment of debt, due to a reclass from the CHF convertible bonds to non-convertible CHF-bonds.

Borrower	Debt instrument denominated in CHF	Amount in CHF		Amount in USD		Annual interest rate			Repayment date *
SunVesta Inc.	Promissory note		10,044,371		10,290,860		7.25	%	After Dec 31, 2020
SunVesta Inc.	Promissory note		10,000,000		10,245,400		7.25	%	After Dec 31, 2020
SunVesta Inc.	Promissory note		10,000,000		10,245,400		7.25	%	After Dec 31, 2020
SunVesta Inc.	Loan agreement		13,395,300		14,713,011		7.25	%	After Dec 31, 2020
SunVesta Holding	Loan agreement		13,811,568		14,487,710		7.25	%	After Dec 31, 2020
Total			57,251,239		59,982,381

~~The~~Details ~~assumptions~~on asthe suborindation clauses: Claims of ~~September~~Aires 30are subordinated to all other existing and future claims against the Company. In the event of insolvency proceedings and the execution of a composition agreement with an assignment of assets(default), ~~2017~~Aires would waive its claims to the extent necessary that the claims of all other creditors, and the costs of the liquidation, debt moratorium or insolvency proceedings, were covered in full by the proceeds of the liquidation of the Company. Further, the claims and interests of Aires are asdeferred ~~follows:~~for the duration of the subordination agreement. None of the claims covered by the subordination agreement may be paid, settled by offsetting or replacement/novation, or newly secured, either in full or in part. The subordination agreement can only be terminated under restrictive preconditions.

Stock Price: CHF 5.08	Annualized Risk Free Rate: 0.001%
Exercise Price: CHF 8	Annualized Volatility: 80%
Time to maturity: 1.00 years

Additional Details on the Loan due to Global Care AG

~~The~~In ~~assumptions~~2018, asGlobal Care AG, a company owned by Dr. Rӧssler (a director of ~~December~~the 31Company), ~~2016~~provided $2,923,745 in cash. Additionally, the sale price of $7,381,864 for bonds sold to New Berlin Limited (a related party controlled by Dr. Max Rössler, a Director and related party) was debited to the non-subordinated loan due to Global Care AG. After a credit for capitalized interest of 7.25% and the recognition of foreign exchange differences (the loans are denominated in Swiss Francs) the respective period end balances as ~~follows:~~mentioned above are resulting. The subordination clauses are the same as those detailed above for Aires International Inc.

Stock Price: CHF 5.08	Annualized Risk Free Rate: 0.001%
Exercise Price: CFH 8	Annualized Volatility: 80%
Time to maturity: 1.75 years

SUNVESTA, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

~~September 30~~MARCH 31, ~~2017~~2018

9. ~~RELATED PARTY TRANSACTIONS~~BONDS

The advances from (to) related parties are composed as follows:

Description	Convertible CHF Bond I	Convertible CHF Bond II
Issuer:	SunVesta Holding AG	SunVesta Holding AG
Type of securities:	Senior convertible bonds, convertible into shares of the issuer at the discretion of the bondholder, in accordance with Swiss law	Senior convertible bonds, convertible into shares of the issuer at the discretion of the bondholder, in accordance with Swiss law
Approval by SunVesta AG BOD:	September 30, 2015	September 30, 2015
Volume:	Up to CHF 45,000,000	Up to CHF 15,000,000
Denomination:	CHF 5,000	CHF 5,000
Offering period:	October 01, 2015	October 01, 2015
Maturity date:	September 30, 2018	September 30, 2018
Issue price:	100%	100%
Redemption price:	100%	100%
Issuance date:	October 01, 2015	October 01, 2015
Coupon:	6.00 % p.a.	6.00 % p.a.
Interest due dates:	September 30 of each year, the first time September 30, 2016	September 30 of each year, the first time September 30, 2016
Reference price:	CHF 6.50	CHF 6.50
Initial conversion price:	CHF 8.00	CHF 8.00
Applicable law:	Swiss	Swiss

			Receivables						Payables
Convertible CHF BOND I	2018				2017
			September 30, 2017				December 31, 2016		September 30, 2017		December 31, 2016
	$				$
1	Aires International			—				—		56,684,218		51,473,793
Balances January 1		2,325,707				3,648,383
2	Global Care AG			—				—		36,469,014		—
Cash inflows		—				—
3	Turan Tokay			—				49,292		—		—
Cash outflows		—				—
	Total			—				49,292		93,153,232		51,473,793
Foreign currency adjustments		55,419				145,296
	of which non-current			—				—		93,153,232		51,473,793
Reclassification from/to bond (net)		—				(1,467,971	)
Sub-total		2,381,126				2,325,707
Discounts (commissions paid to bondholders) and debt issuance costs		(240,760				(240,760	)
Accumulated amortization of discounts and debt issuance costs, including expenses for extinguishment of debt		203,160				185,671
Reclassification from/to bond (net)		—				—
Total accumulated unamortized discounts and debt issuance costs		(37,600				(55,089	)
Balances March 31 and December 31 (Carrying value)		2,343,525				2,270,618

As ofper ~~December~~date ~~31, 2016, a payable~~ of ~~$290~~this report,~~000~~ ~~was presented as a liability to~~ the ~~related~~Company ~~party~~has ~~Akyinyi~~realized ~~Interior~~a ~~and~~cumulative ~~Exterior~~amount ~~Decoration and~~of $~~17,088~~2.4 million (CHF 2.3 million) related to the ~~late~~Convertible ~~Josef~~Bond ~~Mettler, each of which were no longer related parties at that time~~I.

The receivable due from Turan Tokay of $49,292 was fully impaired in 2017.

Related party

Capacity

Interest Rate

Repayment Terms

Security

Aires International

Company owned by Dr. Rössler, a board member

7.25

See below

none

Global Care AG

Company owned by Dr. Rössler, a board member

7.25

See below

none

Turan Tokay

Shareholder

none

Loan agreement Aires International Investment Inc.

As of September 30, 2017, the Company owed Aires International Inc. the following:

Borrower	Debt instrument denominated in CHF	Amount in CHF		Amount in USD		Annual interest rate			Repayment date *
SunVesta Inc.	Promissory note		10,044,371		10,308,739		7.25	%	After Dec 31, 2020
SunVesta Inc.	Promissory note		10,000,000		10,263,200		7.25	%	After Dec 31, 2020
SunVesta Inc.	Promissory note		10,000,000		10,263,200		7.25	%	After Dec 31, 2020
SunVesta Inc.	Loan agreement		11,866,619		12,174,254		7.25	%	After Dec 31, 2020
SunVesta Holding	Loan agreement		13,324,189		13,674,825		7.25	%	After Dec 31, 2020
Total					56,684,218

* The notes may be repaid in whole or in part.

Loan due to Global Care AG

In 2017, Global Care AG, a company owned by Dr. Rӧssler (a director of the Company), provided $36,469,014 ($1,564,444 with a transfer of convertible bonds to the loan and $15,375,505 with a transfer of bonds to the loan) to the Company at 7.25% interest, repayable not before December 31, 2020.

SUNVESTA, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

~~September 30~~MARCH 31, ~~2017~~2018

10 9. BONDS – CONTINUED

Description	EUR (€) bond new I (repaid)		EUR (€) bond new II (parallel) (repaid)
Convertible CHF BOND II	2018			2017
Issuer:	SunVesta Holding AG		SunVesta Holding AG
	$			$
Type of securities:	Bond in accordance with Swiss law		Bond in accordance with Swiss law
Balances January 1		9,012,791			36,770,369
Approval by SunVesta AG BOD:	October 31, 2013		May 19, 2014
Cash inflows		—			20,079
Volume:	Up to EUR15,000,000		Up to EUR 15,000,000
Cash outflows		—			(1,795,594	)
Units:	EUR10,000		EUR 10,000
Foreign currency adjustments		214,879			1,213,824
Offering period:	11/07/2013 – 03/31/2014		05/01/14 – 06/30/14
Reclassification from/to bond (net)		(21,091	)		(27,195,887	)
Due date:	December 2, 2016		December 02, 2016
Sub-total		9,206,579			9,012,791
Issuance price:	100%		100%
Discounts (commissions paid to bondholders) and debt issuance costs		(4,895,604	)		(4,895,604	)
Issuance day:	December 2, 2013		December 02, 2013 (retroactive)
Accumulated amortization of discounts and debt issuance costs		4,728,293			4,644,340
Interest rate:	7.25% p.a.		7.25 % p.a.
Total Accumulated Unamortized discounts and debt issuance costs		(167,311	)		(251,264	)
Interest due dates:	December 02		December 02
Balances March 31 and December 31 (Carrying value)		9,039,267			8,761,527
Applicable law:	Swiss		Swiss

EURO (€) Bond new I	EURO Bond (New) 2017			EURO Bond (New) 2016
	$			$
Balances January 1		31,541			6,871,630
Cash inflows		—			—
Cash outflows		—			(6,736,255	)
Reclassification from / to Bond (net)		(32,271	)		—
Foreign currency adjustments		730			(103,834	)
Sub-total		—			31,541
Discounts (commissions paid to bondholders) and debt issuance costs		(588,613	)		(588,613	)
Accumulated amortization of discounts and debt issuance costs		588,613			563,636
Total accumulated unamortized discounts and debt issuance costs		—			(24,977	)
Balances September 30 and December 31 (Carrying value)		—			6,564

As per date of this report the Company has realized a cumulative amount of $9.2 million (CHF 8.8 million) related to the Convertible Bond II.

The Company initiated another offering of senior unsecured CHF bonds on September 21, 2016, of up to CHF 20,000,000 in units of CHF 5,000 that bear interest at 6.50% per annum payable each August 15, over a four-year term that matures on August 15, 2020, with the following conditions:

Description		CHF Bond III
Issuer:		SunVesta Holding AG
Type of securities:		Senior bonds
Approval by SunVesta AG BOD:		July 7, 2016
Volume:		Up to CHF 20,000,000
Denomination:		CHF 5,000
Offering period:		November 30, 2016
Maturity date:		August 15, 2020
Issue price:		100%
Redemption price:		100%
Issuance date:		September 21, 2016
Coupon:		6.50 % p.a.
Interest due dates:		August 15 of each year, the first time August 15, 2017
Applicable law:		Swiss

SUNVESTA, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

~~September 30~~MARCH 31, ~~2017~~2018

10 9. BONDS – CONTINUED

EURO (€) Bond new II	EUR Bond new II 2017			EUR Bond new II 2016
CHF BOND III original	2018			2017
	$			$
Balances January 1		~~511~~3,~~805~~744,697			115,~~658~~601,~~300~~389
Cash inflows		—			—1,374,842
Cash outflows		~~(510,120~~—	)		~~(159,950~~—	)
Reclassification from / to Bond (net)		(9,761	)		(953,683	)
Foreign currency adjustments		50,052			927,598
Foreign currency adjustments		8,075			(32,862	)
Reclassification from/to bond (net)		7,381,864			(14,159,133	)
Sub-total		—11,176,613			~~511~~3,~~805~~744,697
Discounts (commissions paid to bondholders) and debt issuance costs		(~~174~~248,~~660~~819	)		(~~174~~248,~~660~~819	)
Accumulated amortization of discounts and debt issuance costs		174,660			140,754
Accumulated amortization of discounts and debt issuance costs, including expenses for extinguishment of debt		173,785			167,335
Reclassification from / to Bond (net)		—			—
Total accumulated unamortized discounts and debt issuance costs		(75,034	)		(81,484	)
Total accumulated unamortized discounts and debt issuance costs		—			(33,906	)
Balances March 31 and December 31 (Carrying value)		11,101,579			3,663,213
Balances September 30 and December 31 (Carrying value)		—			477,899

OnIn ~~September~~the 30first quarter of 2018, ~~2015~~$7,381,864 in bonds were sold to New Berlin Limited (a related party controlled by Dr. Max Rössler, a Director and related party). The respective amount was debited to the ~~Company~~non-subordinated ~~approved~~loan due to Global Care AG (a related party controlled by Dr. Max Rössler). As it was a non-cash transaction, the ~~issuance~~amount ofis ~~two~~included ~~new~~in ~~Convertible~~the ~~CHF~~line-item ‘Reclassification from/to bonds (net)’ in the table above.

~~The~~As ~~major~~per ~~terms~~date ~~and~~of ~~conditions~~this ~~are~~report, the ~~following:~~Company has realized a cumulative amount of $11.2 million (CHF 10.7 million) related to the CHF Bond III original.

Description	Convertible CHF Bond I	Convertible CHF Bond II
Issuer:	SunVesta Holding AG	SunVesta Holding AG
Type of securities:	Senior convertible bonds, convertible into shares of the issuer, in accordance with Swiss law	Senior convertible bonds, convertible into shares of the issuer, in accordance with Swiss law
Approval by SunVesta AG BOD:	September 30, 2015	September 30, 2015
Volume:	Up to CHF 45,000,000	Up to CHF 15,000,000
Denomination:	CHF 5,000	CHF 5,000
Offering period:	October 01, 2015	October 01, 2015
Maturity date:	September 30, 2018	September 30, 2018
Issue price:	100%	100%
Redemption price:	100%	100%
Issuance date:	October 01, 2015	October 01, 2015
Coupon:	6.00 % p.a.	6.00 % p.a.
Interest due dates:	September 30 of each year, the first time September 30, 2016	September 30 of each year, the first time September 30, 2016
Reference price:	CHF 6.50	CHF 6.50
Initial conversion price:	CHF 8.00	CHF 8.00
Applicable law:	Swiss	Swiss

Within the abovementioned facility, the Company initiated a new parallel offering of senior unsecured CHF bonds on September 21, 2016. An amount of $979,510 of which was reclassified from EUR Bond II in 2016.

CHF BOND III parallel	2018			2017
	$			$
Balances January 1		1,046,471			961,595
Cash inflows		—			—
Cash outflows		—			—
Foreign currency adjustments		24,936			41,861
Reclassification from/to bond (net)		—			43,015
Sub-total		1,071,408			1,046,471
Discounts (commissions paid to bondholders) and debt issuance costs		(84,021	)		(84,021	)
Accumulated amortization of discounts and debt issuance costs		31,252			26,743
Reclassification from/to bond (net)		—			—
Total accumulated unamortized discounts and debt issuance costs		(52,769	)		(57,278	)
Balances March 31 and December 31 (Carrying value)		1,018,639			989,193

As per date of this report, the Company has realized a cumulative amount of $1.1 million (CHF 1.0 million) related to the CHF Bond III parallel.

SUNVESTA, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

~~September 30~~MARCH 31, ~~2017~~2018

109. BONDS – CONTINUED

Convertible CHF BOND I	Convertible CHF Bond I 2017			Convertible CHF Bond I 2016
	$			$
Balances January 1		3,648,383			2,250,048
Cash inflows		—			1,640,887
Cash outflows		—			(103,008	)
Foreign currency adjustments		167,678			(105,058	)
Reclassification from / to Bond (net)		—			(34,486	)
Sub-total		3,816,061			3,648,383
Discounts (commissions paid to bondholders) and debt issuance costs		(240,760	)		(136,722	)
Accumulated Amortization of discounts and debt issuance costs		167,180			117,652
Reclassification from / to Bond (net)		—			(104,038	)
Total Accumulated Unamortized discounts and debt issuance costs		(73,580	)		(123,108	)
Balances September 30 and December 31 (Carrying value)		3,742,480			3,525,275

On March 6, 2017, the Company has approved issuance of a new bond with the following conditions.

In the first quarter of 2016, the Company reclassified $634,186 from Convertible CHF Bond I.

Description		CHF Bond IV
Issuer:		SunVesta Holding AG
Type of securities:		Senior bonds
Approval by SunVesta AG BOD:		March 6, 2017
Volume:		Up to CHF 50,000,000
Denomination:		CHF 1,000
Offering period:		May 1^st – November 1^st, 2017
Maturity date:		May 1, 2022
Issue price:		100%
Redemption price:		100%
Issuance date:		May 1, 2017
Coupon:		6.50 % p.a.
Interest due dates:		May 1^st of each year, the first time May 1^st, 2018
Applicable law:		Swiss

As per date of this report, the Company has realized a cumulative amount of $2.26 million (CHF 2.20 million) related to the CHF Convertible Bond I. The difference between the carrying value as of September 30, 2017 and the value as per date of this report is due to a transfer of $1.49 million in other bonds. The transfers in detail are: $1.23 million (CHF 1.2 million) to CHF Bond III original, $0.16 million (CHF 0.15 million) to Convertible CHF bond II and $0.1 million (CHF 0.1) to CHF Bond IV.

CHF BOND IV	2018			2017
	$			$
Balances January 1		28,468,904			—
Cash inflows		—			1,678,336
Foreign currency adjustments		678,277			372,407
Reclassification from/to bond (net)		21,091			26,418,161
Sub-total		29,168,271			28,468,904
Discounts (commissions paid to bondholders) and debt issuance costs		(1,454,894	)		(1,453,839	)
Accumulated Amortization of discounts and debt issuance costs		236,807			185,828
Total accumulated unamortized discounts and debt issuance costs		(1,218,087	)		(1,268,011	)
Balances March 31 and December 31 (Carrying value)		27,950,185			27,200,893

Convertible CHF BOND II	Convertible CHF Bond II 2017			Convertible CHF Bond II 2016
	$			$
Balances January 1		36,770,369			26,470,395
Cash inflows		20,079			7,142,850
Cash outflows		(1,795,594	)		(787,371	)
Foreign currency adjustments		1,229,708			(1,187,441	)
Reclassification from / to Bond (net)		(27,174,249	)		5,131,937
Sub-total		9,050,313			36,770,369
Discounts (commissions paid to bondholders) and debt issuance costs		(4,791,566	)		(4,890,690	)
Accumulated Amortization of discounts and debt issuance costs		4,710,642			2,586,541
Reclassification from / to Bond (net)		(0	)		104,038
Total Accumulated Unamortized discounts and debt issuance costs		(80,924	)		(2,200,111	)
Balances September 30 and December 31 (Carrying value)		8,969,389			34,570,259

As per date of this report, the Company has realized a cumulative amount of $29.2 million (CHF 27.8 million) related to the CHF Bond IV.

SUNVESTA, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

~~September 30~~MARCH 31, ~~2017~~2018

10. PENSION ~~BONDS – CONTINUED~~PLAN

In April 2016, Global Care AG (a related party controlled by Dr. Rössler, a Company board member) assumed a liability of CHF 4.5 million due to Aires International Investment Inc., (also a related party controlled by Dr. Rössler). This CHF 4.5 million was subsequently subscribed into bonds of the Convertible Bond II issue. As the conversion inclues a significant conversion option, the exchange is treated as an extinguishment of debt and an amount of $1,071,317 has been reclassified in the comprehensive statements of loss from revaluation of conversion feature to extinguishment of debt. In 2017, $26,138,355 was transferred to the new CHF-Bond IV and $1,035,894 to a note payable to Global Care AG. As the terms of the new bond are significantly different to the convertible bond, an unamortized transaction cost of $1,221,277 were recognized as a gain on extinuishment of debt in the statement of comprehensive income. As per date of this report, the Company has realized a cumulative amount of $9.13 million (CHF 8.89 million) related to the Convertible Bond II. The difference between the carrying value as of September 30, 2017 and the value as of date of this report is due to a transfer of $0.16 million (CHF 0.15 million) from the Convertible CHF Bond I.

The Company initiated a new offering of senior unsecured CHF bonds on September 21, 2016, of up to CHF 20,000,000 in units of CHF 5,000 that bear interest at 6.50% per annum payable each August 15, over a four-year term that matures on August 15, 2020, with the following conditions:

Description		CHF Bond III
Issuer:		SunVesta Holding AG
Type of securities:		Senior bonds
Approval by SunVesta AG BOD:		July 7, 2016
Volume:		Up to CHF 20,000,000
Denomination:		CHF 5,000
Offering period:		November 30, 2016
Maturity date:		August 15, 2020
Issue price:		100%
Redemption price:		100%
Issuance date:		September 21, 2016
Coupon:		6.50 % p.a.
Interest due dates:		August 15 of each year, the first time August 15, 2017
Applicable law:		Swiss

CHF BOND III original	CHF Bond III 2017			CHF Bond III 2016
	$			$
Balances January 1		15,601,389			—
Cash inflows		1,374,842			699,650
Cash outflows		—			—
Foreign currency adjustments		918,879			(290,665	)
Reclassification from / to Bond (net)		(15,375,505	)		15,192,404
Sub-total		2,519,605			15,601,389
Discounts (commissions paid to bondholders) and debt issuance costs		(188,000	)		(56,643	)
Accumulated Amortization of discounts and debt issuance costs		95,689			3,814
Reclassification from/to Bond (net)		—			(49,975	)
Total Accumulated Unamortized discounts and debt issuance costs		(92,311	)		(102,804	)
Balances September 30 and December 31 (Carrying value)		2,427,294			15,498,586

SUNVESTA, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2017

10. BONDS – CONTINUED

During the year 2016 an amount of $15,192,404 (CHF 15.2 million) was subscribed into this CHF Bond III with loans from related parties. Since the new debt was not significantly different from the old debt and did not include a conversion feature deemed substantive, the exchange was not treated as an extinguishment of debt. In the third quarter 2017, $ 15,375,505 (CHF 14.8 million) was transferred from this CHF Bond III to loans from related parties. The exchange was treated as an extinguishment of debt with a corresponding expense $106,762.

As per date of this report, the Company has realized a cumulative amount of $3.60 million (CHF 3.51 million) related to the CHF Bond III original. The difference between the carrying value as of September 30, 2017 and the value as of date of this report is due to a transfer from Convertible CHF Bond I.

Within the CHF Bond III, the Company initiated a new parallel offering of senior unsecured CHF bonds on September 21, 2016.

CHF BOND III parallel	CHF Bond III 2017			CHF Bond III 2016
	$			$
Balances January 1		961,595			—
Cash inflows		—			—
Cash outflows		—			—
Foreign currency adjustments		43,674			(17,915	)
Reclassification from / to Bond (net)		43,015			979,510
Sub-total		1,048,284			961,595
Discounts (commissions paid to bondholders) and debt issuance costs		(79,289	)		(79,289	)
Accumulated Amortization of discounts and debt issuance costs		15,959			4,001
Reclassification from / to Bond (net)		—			—
Total Accumulated Unamortized discounts and debt issuance costs		(63,330	)		(75,288	)
Balances September 30 and December 31 (Carrying value)		984,954			886,307

As per date of this report, the Company has realized a cumulative amount of $0.98 million (CHF 0.96 million) related to the CHF Bond III parallel.

SUNVESTA, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2017

10. BONDS – CONTINUED

As of March 6, 2017 the Company has approved issuance of a new bond with the following conditions.

Description		CHF Bond IV
Issuer:		SunVesta Holding AG
Type of securities:		Senior bonds
Approval by SunVesta AG BOD:		March 6, 2017
Volume:		Up to CHF 50,000,000
Denomination:		CHF 1,000
Offering period:		May 1st – November 1st, 2017
Maturity date:		August 15, 2022
Issue price:		100%
Redemption price:		100%
Issuance date:		May 1, 2017
Coupon:		6.50 % p.a.
Interest due dates:		May 1st of each year, the first time May 1st, 2018
Applicable law:		Swiss

CHF BOND IV	CHF Bond IV 2017
	$
Balances January 1		—
Cash inflows		1,405,881
Foreign currency adjustments		415,791
Reclassification from / to Bond (net)		26,138,355
Sub-total		27,960,026
Discounts (commissions paid to bondholders) and debt issuance costs		(1,388,875	)
Accumulated Amortization of discounts and debt issuance costs		104,142
Reclassification from / to Bond (net)		—
Total Accumulated Unamortized discounts and debt issuance costs		(1,284,733	)
Balances September 30 (Carrying value)		26,675,293

In 2017, $26,138,355 were transferred from CHF Bond III original.

As per date of this report, the Company has realized a cumulative amount of $26.77 million (CHF 26.08 million) related to the CHF Bond IV. The difference between the carrying value as of September 30, 2017 and the value as of date of this report is due to a transfer of $0.10 million (CHF 0.10 million) from Convertible CHF Bond I.

SUNVESTA, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2017

11. PENSION PLAN

The Company maintains a pension plan covering all employees in Switzerland. The plan is considered a defined benefit plan and accounted for 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 ratably 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 recorded in the net loss. 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 comprehensive loss. 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 Company,’s results as follows:

Pension expense

Three months ended September 30, 2017

Nine months ended September 30, 2017

Three months ended September 30, 2016

Nine months ended September 30, 2016

Three months ended March 31, 2018

Three months ended March 31, 2017

Pension expense

Current service cost

14,~~055~~685

4214,~~166~~055

~~15,357~~

~~46,070~~

Net actuarial (gain) loss recognized

—

Interest cost

~~577~~524

~~1,732~~577

~~945~~

~~2,836~~

Expected return on assets

(1,~~431~~573

)

(41,~~292~~431

)

~~(1,916~~

)

~~(5,749~~

)

Employee contributions

(5,~~020~~245

)

(155,~~059~~020

)

~~(5,877~~

)

~~(17,631~~

)

Net periodic pension cost

8,~~182~~392

248,~~546~~182

~~8,509~~

~~25,526~~

During the three month, periods ended ~~September~~March 3031, ~~2017~~2018 and ~~September~~March 3031, ~~2016~~2017, the Company made cash contributions of $5,~~020~~245 and $1527,~~534~~494, respectively, to its defined benefit pension plan.

All of the assets are held under a collective contract by the plan’s re-insurance company and are invested in a mix of Swiss and international fixed-income and equity securities within the limits set out by the Swiss pension law.

The remaining expected future cash flows to be paid by the Company in respect to employer contributions to the pension plan for the year ended December 31, ~~2017~~2018, are $1015,~~039~~735.

2421

SUNVESTA, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

~~September 30~~MARCH 31, ~~2017~~2018

1211. STOCK COMPENSATION

The Company has included share based compensation under the SunVesta Inc. Stock Option Plan 2013 (“Plan”) as part of the total remuneration in certain employment and Board of Director’s contracts. The Company is authorized to grant up to 50,000,000 stock options under the Plan to acquire shares of its common stock.

The purpose of the Plan is to advance the interests of the Company by encouraging its employees to remain associated with the Company and to assist it in building value. Such share based remuneration includes either shares or options to acquire shares of the Company’s common stock. For all employees, fair value is estimated at the grant date. Compensation costs for unvested shares are expensed over the requisite service period on a straight-line basis.

For all employees, fair value is estimated at the grant date. Compensation costs for unvested shares are expensed over the requisite service period on a straight-line basis.

Share Grants – Mr. Hans Rigendinger

On January 1, 2013, the Company granted 3,500,000 common shares to ~~Dr.~~ Hans Rigendinger, valued at $0.08 an amount equal to the share price and fair value of the shares on the grant date in connection with his employment agreement with the Company. His employment agreement obligates the Company to issue 2,500,000 common shares as a retention award on each anniversary of the employment agreement. The employment agreement ~~has~~had an initial term of three years with the option to extend for an additional two years. ~~Dr.~~Mr Rigendinger’s employment agreement was renewed for additional two years on January 1, 2016. Therefore, the Company may issue up to 1216,~~500~~000,000 common shares, of which ~~10,000,000~~ all have been earned as of December 31, ~~through~~2017. ~~January~~As 1of the date of this report, ~~2018~~an extension of Mr. Rigendinger’s agreement is being negotiated. The specific terms have not yet been agreed upon.

Share Grants – Dr. Max Rössler

On July 3, 2013, the Company granted to Dr. Max Rössler 3,000,000 common shares, valued at $0.07 an amount equal to the share price and fair value of the shares on the grant date in connection with his appointment to the Board of Directors.

Share Grants – Mr. Josef Mettler

On July 4, 2013, the Company granted 5,000,000 common shares to Josef Mettler, valued at $0.07, an amount equal to the share price and fair value of the shares on the grant date, in connection with his employment agreement with the Company. His employment agreement obligated the Company to issue 3,000,000 common shares as a retention award on each anniversary of the employment agreement. The employment agreement had an initial term of three years with the option to extend for two additional two-year periods. Mr. Mettler’s employment agreement was renewed on July 4, 2016. Therefore, in total the Company could have issued up to 21,000,000 common shares, of which 9,000,000 were earned prior to his death, through December 31, 2020.

Josef Mettler died during the third quarter of 2016. Subsequently, the necessary accrual up until his death was reversed as of September 30, 2016.

Share Grants – Mr. José María Figueres

On March 10, 2014, the Company granted 500,000 common shares to José María Figueres, valued at $0.10, an amount equal to the share price and therefore the fair value on grant date, in connection with his appointment to the Board of Directors. His appointment obligates the Company to issue 200,000 common shares for each fully completed year of service. José Maria Figueres resigned his position on the Company’s Board of Directors on January 10, 2018. Therefore, no more shares will be issued to José María Figueres in 2018.

SUNVESTA, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2017

12. STOCK COMPENSATION – CONTINUED

Share Grants –Howard Glicken

On March 10, 2014, the Company granted 500,000 common shares to Howard Glicken, valued at $0.10, an amount equal to the share price and therefore the fair value on grant date, in connection with his appointment to the Board of Directors. His appointment obligates the Company to issue 200,000 common shares for each fully completed year of service. Howard Glicken resigned his position on the Company’s Board of Directors on December 22, 2017. Therefore, no more shares will be issued to Howard Glicken in 2018.

Share Grants – Third party

On November 1, 2016, the Company ~~granted~~committed 10,000,000 common shares to a non-related individual, valued at a total of $240,947 (CHF 240,000) the fair value on grant date, in connection with his consulting services for the Company. His appointment obligated the Company to issue 1,666,667 common shares for each fully completed month of service. From November 1, 2016 to April 30, 2017, the individual earned a total of 10,000,000 shares, creating an expense for the Company in the amount of $240,947. In the second quarter of 2017, it was agreed with the third party to replace the ~~granted~~ shares committed with a cash compensation of $240,947 (CHF 240,000).

SUNVESTA, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2018

11. STOCK COMPENSATION – CONTINUED

Share Grants – Summary

Based on these contracts, the Company has included the following stock-based compensation in the Company’s results:

Stock-based compensation (shares)	~~Three and nine months ended September 30, 2017~~	~~Three~~Balances ~~and~~as ~~nine~~of ~~months~~March ~~ended September 30~~31, ~~2016~~2018		Balances as of December 31, 2017
Shares granted	~~57,200,000 shares~~	4657,~~800~~200,000 shares		57,200,000 shares
Fair Value respectively market price on grant date	~~$0.0659~~	$~~0.0737~~	0.0659	$	0.0659
Total maximal expenses (2013-2020)	~~$3,770,947~~	$~~3,450,000~~	3,770,947	$	3,770,947
Shares vested	~~32,700,000 shares~~	~~29,800,000 shares~~	35,200,000 shares		35,200,000 shares
Shares forfeited	~~22,000,000 shares~~	~~12,000,000 shares~~	22,000,000 shares		22,000,000 shares
Unvested shares	~~2,500,000 shares~~	~~17,000,000 shares~~	0 shares		0 shares

OfThe ~~the~~following ~~granted~~table ~~shares,~~gives ~~12,000,000~~an ~~were~~overview ~~forfeited~~on ~~due~~the tounrecognized ~~the~~share ~~death~~based ofcompensation ~~Josef~~expense ~~Mettler~~as ~~during~~per the ~~third~~end ~~quarter~~of ~~2016. In~~ the ~~second~~reporting ~~quarter 2017, 10,000,000 were forfeited when replaced by cash compensation~~period.

As of September 30, 2017, the Company expects to record compensation expense in the future up to $50,000 as follows:

Year ending December 31,

Stock-based compensation (shares)

Through December 31, 2018

2019

2020

2021

Unrecognized compensation expense

None

—

			Year ending December 31,
Stock-based compensation (shares)	Through December 31, 2017 $		2018 $		2019 $		2020 $
Unrecognized compensation expense		50,000		—		—		—

Stock Options – Dr. Hans Rigendinger

The Company granted 10,000,000 stock options to Dr. Hans Rigendinger on January 1, 2013, in connection with his employment contract. Each option entitles Dr. Rigendinger to buy one Company share at an exercise price of $0.05. These options vest in two identical installments (Installment A and Installment B) of 5,000,000.

26Installment A vesting was contingent on realizing a financing arrangement with a specific counterparty. As of the grant date, the fair value was $300,000. As of July 4, 2013, the Company assessed that this financing arrangement with the specific counterparty would not be completed. Therefore, the Company assessed the probability of completion to be zero and recognized no expense. On July 4, 2013, the Company authorized a revised stock option agreement that removed the requirement for financing with a specific counterparty and updated for any counterparty. As of the date of the revised stock option agreement, the fair value was $246,000. Since the modification changed the expectation that the options would ultimately vest and no expense had been recognized for the original award, the fair value of the modified award has been expensed on a straight-line basis over the recalculated expected remaining vesting period.

SUNVESTA, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

~~September 30~~MARCH 31, ~~2017~~2018

12 11. STOCK COMPENSATION – CONTINUED

Stock Options – Dr. Hans Rigendinger - continued

Installment AB vesting ~~was~~is contingent on ~~realizing~~Meliá aHotels ~~financing~~International ~~arrangement~~(“Melía”) ~~with~~assuming amanagement ~~specific~~responsibilities for ~~counterparty~~the Paradisus Papagayo Bay Resort & Luxury Villas. As of the grant date, the fair value was $~~300~~340,000. Asand ofthe ~~July~~Company 4,estimated that ~~2013,~~Meliá ~~the~~would ~~Company~~assume ~~assessed~~responsibility ~~that~~as ~~this~~of ~~financing~~July ~~arrangement~~1, ~~with~~2015. ~~the~~As ~~specific~~of ~~counterparty~~the ~~would~~date ~~not be~~of ~~completed.~~this ~~Therefore~~report, the ~~Company~~estimated ~~assessed~~opening ~~the~~date ~~probability~~has been ofpostponed ~~completion~~ to bemid-2020, ~~zero~~being ~~and~~the ~~recognized~~required nodate ~~expense~~of the performance condition. OnThe ~~July~~Company 4,has ~~2013,~~ assessed the ~~Company~~probability ~~authorized~~that this aperformance ~~revised~~condition ~~stock~~will ~~option~~be ~~agreement~~met ~~that~~at ~~removed~~100%. Hence, the ~~requirement~~remaining ~~for~~fair ~~financing~~value ~~with~~of athe ~~specific~~award ~~counterparty and~~has ~~updated~~been ~~for~~expensed ~~any~~on ~~counterparty.~~a Asstraight-line basis ofover the ~~date~~recalculated ofexpected ~~the~~remaining ~~revised~~vesting ~~stock~~period. ~~option~~The ~~agreement,~~assumption on the ~~fair~~probability ~~value~~to ~~was~~meet ~~$246,000.~~the ~~Since~~performance ~~the~~condition ~~modification~~is ~~changed~~currently ~~the~~under ~~expectation~~review ~~that~~due to the ~~options~~ongoing ~~would~~negotiations ~~ultimately~~with ~~vest~~Melía ~~and~~(please norefer ~~expense~~to ~~had~~Note ~~been~~14). ~~recognized~~If ~~for~~ the ~~original award,~~assumption on the probability ~~fair~~to ~~value~~meet of the ~~modified~~performance ~~award~~condition ~~has~~would ~~been~~be ~~expensed~~lowered, onexpenses arecognized ~~straight-line~~in ~~basis~~the ~~over~~past ~~the~~would ~~recalculated~~be ~~expected~~reversed ~~remaining~~which would ~~vesting~~reduce ~~period~~the net loss.

Installment B vesting is contingent on Meliá Hotels International (“Melía”) assuming management responsibilities for the Paradisus Papagayo Bay Resort & Luxury Villas. As of the grant date, the fair value was $340,000 and the Company estimated that Meliá would assume responsibility as of July 1, 2015. As of March 6, 2014, the Company assessed the probability that this performance condition would be met to be 100%, but the date on which the performance condition would have to be achieved was postponed to the fourth quarter 2015, in line with the expected opening date.

As of the date of this report, the estimated opening date has been postponed further to a date after the fourth quarter 2018, being the required date of the performance condition. The Company still assesses the probability that this performance condition will be met at 100%. Hence, the remaining fair value of the award has been expensed on a straight-line basis over the recalculated expected remaining vesting period.

Stock Options – Dr. Max Rӧssler

The Company granted 10,000,000 stock options to Dr. Max Rӧssler on July 3, 2013, in connection with his appointment to the Board of Directors. Each option entitles Dr. Rӧssler to buy one Company share at an exercise price of $0.05. These options vest in two identical installments (Installment A and Installment B) of 5,000,000 options.

Installment A vesting is contingent on realizing a financing arrangement to complete the development of the Paradisus Papagayo Bay Resort & Luxury Villas. As of the grant date, the fair value was $249,835. The Company has expensed the total fair value of the award on a straight-line basis over the expected vesting period.

Installment B vesting is contingent on Meliá assuming management responsibilities for the Paradisus Papagayo Bay Resort & Luxury Villas. As of the grant date the fair value was $258,210 and the Company estimated that Meliá would assume responsibility as of July 1, 2015. As of ~~March~~the 6date of this report, ~~2014~~the estimated opening date has been postponed to mid-2020, being the required date of the performance condition. The Company has assessed the probability that this performance condition ~~would~~will be met ~~to be~~at 100%. Hence, ~~but~~the remaining fair value of the ~~date~~award has been expensed on ~~which~~a straight-line basis over the recalculated expected remaining vesting period. The assumption on the probability to meet the performance condition ~~would~~is ~~have~~currently under review due to bethe ~~achieved~~ongoing negotiations ~~was~~with ~~postponed~~Melía (please refer to Note 14). If the ~~fourth~~assumption ~~quarter~~on ~~2015,~~the inprobability to meet the performance condition ~~line~~would ~~with~~be lowered, expenses recognized in the ~~expected~~past ~~opening~~would ~~date~~be reversed which would reduce the net loss.

SUNVESTA, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

~~September 30~~MARCH 31, ~~2017~~2018

1211. STOCK COMPENSATION – CONTINUED

Stock Options – Mr. Josef Mettler

The Company granted several installments of stock options in connection with his employment contract.

Due to his passing away during the third quarter 2016, the probability that any of the corresponding performance conditions will be met is 0%. Therefore, all previously recognized expenses in the amount of $561,064, corresponding to options that had not yet vested, were reversed as of September 30, 2016.

Stock Options – Summary

A summary of stock options outstanding as per ~~September~~March 3031, ~~2017~~2018 is as follows:

Options outstanding	Number of Options		Weighted average exercise price		Weighted average remaining contractual life
Outstanding January 1, 2017		20,000,000	$	0.05		6.38 years
Outstanding January 1, 2018		20,000,000	$	0.05		5.38 years
Granted		—
Exercised		—
Forfeited or expired		—
Outstanding September 30, 2017		20,000,000	$	0.05		5.63 years
Outstanding March 31, 2018		20,000,000	$	0.05		5.13 years
Exercisable September 30, 2017		—
Exercisable March 31, 2018		—

The following table depicts the Company’s non-vested options as of ~~September~~March 3031, ~~2017~~2018 and changes during the period:

Non-vested options	Shares under Options		Weighted average grant date fair value
Non-vested at January 1, 2017		20,000,000	$	0.075
Non-vested at January 1, 2018		20,000,000	$	0.075
Non-vested-granted		—		—
Vested		—		—
Non-vested, forfeited or cancelled		—		—
Non-vested at September 30, 2017		20,000,000	$	0.075
Non-vested at March 31, 2018		20,000,000	$	0.075

Under the provisions of ASC 718 Compensation – Stock Compensation, the Company is required to measure and recognize compensation expense related to any outstanding and unvested stock options previously granted, and thereafter recognize, in its consolidated financial statements, compensation expense related to any new stock options granted after implementation using a calculated fair value based option-pricing model. The Company uses the Black-Scholes option-pricing model to calculate the fair value of all of its stock options and its assumptions are based on historical and available market information. No stock options were granted for the periods ended ~~September~~March 3031, ~~2017~~2018 and ~~September~~March 3031, ~~2016~~2017.

Assumption	~~September~~March 3031, ~~2017~~2018	~~September~~March 3031, ~~2016~~2017
Dividend yield	n.a	n.a
Risk-free interest rate used (average)	n.a	n.a
Expected market price volatility	n.a	n.a
Average expected life of stock options	n.a	n.a

The computation of the expected volatility assumption used in the Black-Scholes calculation for new grants is based on historical volatilities of a peer group of similar companies in the same industry. The expected life assumptions are based on underlying contracts.

28As of March 31, 2018, the Company had unrecognized compensation expenses related to stock options currently outstanding, to be recognized in future quarters or years, respectively as follows:

Stock-based compensation (options)

As per
March 31,

2018

As per
December 31, 2017

Unrecognized compensation expense

27,651

30,723

SUNVESTA, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

~~September 30~~MARCH 31, ~~2017~~2018

12. ~~STOCK~~SUMMARY ~~COMPENSATION~~OF –SHARE ~~CONTINUED~~AND OPTION COMPENSATION EXPENSE

AsThe ofCompany ~~September~~recorded ~~30,~~the ~~2017,~~following ~~the~~amounts ~~Company~~related ~~had~~to ~~unrecognized~~stock based compensation ~~expenses~~expense ~~related~~during tothe ~~stock~~periods ~~options~~ended ~~currently~~March ~~outstanding~~31, to2018 beand ~~recognized~~March in31, ~~future quarters or years~~2017, respectively ~~as follows~~:

Stock-based compensation (options)	Through December 31, 2017 $		Year ending December 31, 2018 $
Summary of share and option based compensation expense	Three months ended March 31, 2018 $		Three months ended March 31, 2017 $
Unrecognized compensation expense		10,241		30,723
Share grants (see Note 11 for details)		0		260,789
Option grants (see Note 11 for details)		3,072		10,241
Total (recorded under general & administrative expense)		3,072		271,030

13. ~~SUMMARY~~FUTURE OFLEASE ~~SHARE AND OPTION COMPENSATION EXPENSE~~ COMMITTMENTS

The Company ~~recorded~~entered ~~the~~into ~~following~~a ~~amounts~~lease ~~related~~agreement tofor ~~stock~~the ~~based~~premises ~~compensation~~for ~~expense~~its ~~during~~Swiss ~~the~~office ~~periods~~with ~~ended~~an ~~September~~unrelated ~~30,~~entity. ~~2017~~The annual rental expense ~~and~~amounts ~~September~~to 30approximately $130,000 ~~2016~~on a fixed term expiring on December 31, ~~respectively:~~2018.

Summary of share and option based compensation expense	Three months ended September 30, 2017 $		Three months ended September 30, 2016 $			Nine months ended September 30, 2017 $		Nine months ended September 30, 2016 $
Future lease commitments		March 31, 2018 $		December 31, 2017 $
Share grants (see Note 12 for details)		50,000		60,000			163,318		285,000
Payable in 2018		97,500		130,000
Option grants (see Note 12 for details)		10,241		(550,823	)		30,723		(520,153	)
Total (recorded under general & administrative expense)		60,241		(490,823	)		194,041		(235,153	)

14. ~~FUTURE~~OPENING ~~LEASE~~DATE ~~COMMITTMENTS~~“Paradisus Papagayo Bay Resort & Luxury Villas”

OnDated ~~December~~April 127, ~~2012~~2016, the Company ~~entered~~amended ~~into~~its ~~a lease~~ agreement ~~for the premises for its Swiss office~~ with anMeliá ~~unrelated~~(“Seventh ~~entity.~~addendum ~~The annual rental expense amounts~~ to ~~approximately~~the ~~$130,000~~management onagreement aof ~~fixed term expiring on December 31~~March 8, ~~2017.~~2011”) ~~This contract was extended~~ to ~~December~~postpone ~~31, 2018 in~~ the ~~third~~opening ~~quarter~~date ~~2017.~~as follows:

Future lease commitments				September 30, 2017 $
	2017				162,500

15. NOTE PAYABLE

	September 30, 2017		December 31, 2016
		$		$
Promissory note		0		1,500,000
Total		0		1,500,000

On September 19, 2016, the Company signed an agreement with the counterparty, which stipulated payment terms of four quarterly installments of $500,000 each starting on November 21, 2016. The last tranch was repaid in the 3rd quarter 2017.

SUNVESTA, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2017

16. OPENING DATE “Paradisus Papagayo Bay Resort & Luxury Villas”

On April 27, 2016, the Company amended its agreement with Meliá (“Seventh addendum to the management agreement of March 8, 2011”) to postpone the opening date as follows:

New completion date: September 15, 2018 (subject to force majeure)

Should the completion not occur by September 15, 2018 and should the parties not have agreed in writing an extension to such date, after September 15, 2018, the Company will be obligated to pay Melía a daily amount of $2,000 as liquidated damages.

Should the completion not occur by November 15, 2018, Meliá will be entitled to terminate the agreement and $5,000,000 in liquidated damages unless the parties agree in writing to extend the completion date.

~~The~~Since ~~dates~~the ~~stipulated~~Company ~~above~~expects ~~are~~the noopening ~~longer~~of ~~likely~~the toParadisus bePapagayo ~~realized.~~Bay ~~Consequently,~~Resort it& ~~will~~Luxury beVillas ~~necessary~~by tomid-2020, ~~enter~~and ~~into~~another anaddendum ~~8th~~has not ~~Addendum~~yet ~~with Meliá.~~been ~~The~~secured, ~~Company~~it ishas ~~confident~~recognized ~~that~~a itprovision ~~will~~for beliquidated ~~able~~damages toof ~~achieve~~$5,120,000 ~~this~~as ~~objective~~of inDecember ~~due~~31, ~~course~~2017 and March 31, 2018.

~~17. EARNINGS PER SHARE~~26

Basic earnings per share are the result of dividing the Company’s net income (or net loss) by the weighted average number of shares outstanding for the contemplated period. Diluted earnings per share are calculated applying the treasury stock method. When there is a net income dilutive effect, all stock-based compensation awards or participating financial instruments are considered. When the Company posts a loss, basic loss per share equals diluted loss per share. The following table depicts how the denominator for the calculation of basic and diluted earnings per share was determined under the treasury stock method.

Earnings per share

Three-month period ended September 30, 2017

Three-month period ended September 30, 2016

Nine-month period ended September 30, 2017

Nine-month period ended September 30, 2016

Company posted

Net loss

Basic weighted average shares outstanding

104,741,603

101,740,479

105,905,770

99,707,537

Dilutive effect of common stock equivalents

None

Dilutive weighted average shares outstanding

104,741,603

101,740,479

105,905,770

99,707,537

A total of 2,900,000 common shares have vested, that had not been issued, as of the balance sheet date are included in the basic weighted average of shares outstanding.

SUNVESTA, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

~~September 30~~MARCH 31, ~~2017~~2018

1715. EARNINGS PER SHARE ~~- CONTINUED~~

~~The~~Basic ~~following~~earnings ~~table~~per ~~shows~~share are the ~~number~~result of ~~stock~~dividing ~~equivalents~~the ofCompany’s ~~SunVesta~~net ~~Inc.~~income ~~that~~(or ~~were~~net ~~excluded~~loss) ~~from~~by the ~~computation~~weighted average number of ~~diluted~~shares outstanding for the contemplated period. Diluted earnings per share are calculated applying the treasury stock method. When there is a net income dilutive effect, all stock-based compensation awards or participating financial instruments are considered. When the Company posts a loss, basic loss per share equals diluted loss per share. The following table depicts how the denominator for the ~~respective~~calculation ~~period~~of ~~because~~basic ~~the~~and ~~effect~~diluted ~~would~~earnings ~~have~~per ~~been~~share ~~anti-dilutive~~was determined under the treasury stock method.

Earnings per share	Three-month period ended ~~September~~March 3031, ~~2017~~2018		Three-month period ended ~~September~~March 3031, ~~2016~~2017		~~Nine-month period ended September 30, 2017~~		~~Nine-month period ended September 30, 2016~~
Options to Hans Rigendinger		10,000,000		10,000,000		10,000,000		10,000,000
Company posted		Net loss		Net loss
Options to Dr. M. Rössler		10,000,000		10,000,000		10,000,000		10,000,000
Basic weighted average shares outstanding		107,241,603		108,234,104
Options to Josef Mettler								12,000,000
Dilutive effect of common stock equivalents		None		None
Total Options		20,000,000		20,000,000		20,000,000		32,000,000
Dilutive weighted average shares outstanding		107,241,603		108,234,104
Shares to Hans Rigendinger (retention bonus – non vested)		2,500,000		5,000,000		2,500,000		5,000,000
Shares to Josef Mettler’s estate (retention award)		0		0		0		15,000,000
Shares to Howard Glicken and José Maria Figueres (retention award)		400,000		400,000		400,000		400,000
Total Shares		2,900,000		5,400,000		2,900,000		20,400,000
Total Options and Shares		22,900,000		25,400,000		22,900,000		52,400,000

A total of 2,500,000 common shares have vested, that had not been issued, as of the balance sheet date are included in the basic weighted average of shares outstanding.

The following table shows the number of stock equivalents of the Company that were excluded from the computation of diluted earnings per share for the respective period because the effect would have been anti-dilutive.

Earnings per share	Three-month period ended March 31, 2018		Three-month period ended March 31, 2017
Options to Hans Rigendinger		10,000,000		10,000,000
Options to Dr. M. Rössler		10,000,000		10,000,000
Total Options		20,000,000		20,000,000

Shares to Hans Rigendinger (retention bonus –not vested)		0		2,500,000
Shares to third party		0		1,666,665
Shares to Howard Glicken and José Maria Figueres (retention award)		0		400,000
Total Shares		0		4,566,665

Total Options and Shares		20,000,000		24,566,665

Options related to Convertible CHF bonds: Each bond in the principal amount of CHF 5,000 can be converted on any business day during the conversion period into 625 common shares of SunVesta Holding AG at a conversion price equal to CHF 8.

A number of 1,~~498~~380,~~928~~863 stock equivalents of SunVesta Holding AG associated with the Convertible CHF Bond were excluded from the computation of diluted earnings per share for the ~~nine~~three-month period ended ~~September~~March 3031, ~~2017~~2018, because the effect would have been anti-dilutive (43,~~259~~877,~~465~~625 for the ~~nine~~three-month period ended ~~September~~March 3031, ~~2016~~2017).

~~18. GENERAL AND ADMINISTRATIVE EXPENSES~~27

SUNVESTA, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2018

16. GENERAL AND ADMINISTRATIVE EXPENSES

General and administrative expenses according to the consolidated statement of comprehensive loss include:

Three-month period ended September 30, 2017

Three-month period ended September 30, 2016

Nine-month period ended September 30, 2017

Nine-month period ended September 30, 2016

Three-month period ended March 31, 2018

Three-month period ended March 31, 2017

Rental & related expenses

3533,~~192~~711

4939,~~032~~119

~~111,305~~

~~153,817~~

Audit

259,~~800~~148

6399,~~698~~610

~~152,406~~

~~251,338~~

Consulting

1454,~~206,332~~102

1695,~~022,910~~751

~~2,385,665~~

~~1,984,715~~

Marketing, Investor & public relations

~~12,770~~—

3610,~~055~~500

~~41,011~~

~~77,364~~

Travel expenses

9778,~~451~~778

66133,~~053~~958

~~403,957~~

~~262,966~~

Personnel costs including social security’s costs and share based remuneration

~~282~~212,~~557~~803

~~(219~~283,~~192~~533

)

~~796,525~~

~~686,963~~

Office expenses

—4,847

—203

~~203~~

—

Various other operating expenditures

~~103~~110,~~242~~113

53113,~~270~~295

~~362,527~~

~~581,397~~

Total according statement of comprehensive loss

1953,~~740,343~~502

1,~~071~~375,~~827~~970

~~4,253,599~~

~~3,998,562~~

1917. SUBSEQUENT EVENTS

Management has evaluated subsequent events after the balance sheet date, through the issuance of the financial statements, for appropriate accounting and disclosure. The Company has determined that there are no events that warrant disclosure or recognition in the financial statements.

3128

Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This Management’s 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 ~~nine~~three-month periods ended ~~September~~March 3031, ~~2017~~2018 and ~~September~~March 3031, ~~2016.~~ 2017. Our fiscal year end is December 31.

Discussion and Analysis

Business Overview

WeThe ~~are~~Company inis ~~the business of~~ developing ~~high-end~~a ~~luxury~~five ~~hotels~~star ~~and resorts in countries that are emerging as popular tourist destinations. Our intention is to develop~~ luxury hotel ~~products~~and ~~located~~resort ~~in countries such as Costa Rica that are emerging as popular tourist destinations. Our first hospitality development, to be constructed~~ on 20.5 hectares of prime land located in Guanacaste Province, ~~Costa~~ Costa Rica isto be known as the Paradisus Papagayo Bay Resort & Luxury Villas,. aAll ~~five-star~~planning ~~luxury~~and ~~hotel.~~essentially ~~All~~all permitting for the ~~project~~ project is in place. Furthermore, ~~including permission to incorporate the beachfront adjacent to the two concessions into the development and~~ all significant site work ~~completed~~is complete. Vertical construction iswill ~~expected to~~ commence ~~during~~as ~~the~~soon ~~fourth~~as ~~quarter~~a offinancing is ~~2017,~~in ~~while~~place. ~~the~~The ~~opening of the~~ Paradisus Papagayo Bay Resort & Luxury Villas is ~~scheduled~~expected ~~not~~to ~~before~~open ~~the~~by ~~fourth~~mid-2020. ~~quarter~~A ~~2018.~~start ~~The~~to ~~estimated~~vertical ~~commencement~~construction ofand ~~construction~~the ~~and~~expected opening ~~dates~~date are subject to the Company securing sufficient capital commitments to ~~complete~~finish the ~~development~~project.

Specifications

Paradisus Papagayo Bay Resort & Luxury Villas, initial specifications are to be as follows:

—	eco-luxury all-inclusive resort
—	382-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
—	19,000 square feet of meeting facilities with the business traveler in mind

3229

Vista Mar

Family Concierge

The Family Concierge will be a family orientated part of the Paradisus Papagayo Bay Resort & Luxury Villas. The accommodations will be designed to satisfy the needs of the modern family.

The Family Concierge area will include:

—	166 Junior Suites Deluxe	(47* square meters)
—	34 Suites Deluxe	(87* square meters)
—	33 Suites Premium	(93* square meters)
—	6 Handicapped Junior Suites Deluxe	(47* square meters)
—	1 Bridal Suites	(93* square meters)
—	2 Deluxe Suites Presidential	(88* square meters)
—	1 Presidential Suite	(194* 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. Family Concierge guests will furthermore have access to restaurants, bars, and lounges. The planned Onyx Night Club and the Gabi Club will be located near the beach.

Vista Bahia

Royal Service

Our Royal Service will include an extensive range of services such as a butler service, private pools for each Garden Villa and/or a Jacuzzi in every suite. The Royal Service area will include:

The Royal Service area will include:

—	108 Junior Suites Grand Deluxe	(43-60* square meters)
—	2 Junior Suites Grand Deluxe for Handicapped Guests	(53* square meters)
—	6 Grand Master Suites	(87* square meters)
—	2 Deluxe Suites Presidential	(60 square meters)
—	1 Grand Presidential Suite (4 bedrooms)	(145* square meters)
—	20 one or two-bedroom Garden Villas	(91–212* square meters)
—	Room size does not include balconies and terraces.
*	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.

The Paradisus Papagayo Bay Resort & Luxury ~~Villa,s~~Villas will feature other highlights including:

—	more than 65 private, swim up and resort pools including the world’s 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 meters 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 meters 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 lease them back to the resort when not occupied by the owners.

3330

Management

Overall project development is led by ~~Dr.~~ Hans Rigendinger, our Chairman of the Board and Chief Executive Officer, Charles Fessel, Project Director ~~Paradisus Papagayo Bay Resort & Luxury Villas~~, Cyrill Escher, Chief Funding Officer and Ernst Rosenberger, the Company’s Corporate Controller. The lead architect is Ossenbach, Pendones & Bonilla, one of Costa Rica’s 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 led by Laboratorio Quattro.

Resort management iswas to be provided by ~~Melía~~Meliá Hotels International (“~~Melía~~Meliá”). “Paradisus” is Meliá’s five-star all-inclusive luxury hotel brand that is well recognized in the hospitality industry around the world. ~~Melía~~Meliá was founded in 1956 in Palma de Mallorca, Spain and is today one of the world’s largest resort hotel chains, as well as Spain’s leading hotel chain for business or leisure. ~~Melía~~Meliá offers more than 300 hotels in 26 countries over four continents under its Gran Sol ~~Melía~~Meliá, Sol ~~Melía~~Meliá, ME by Sol ~~Melía~~Meliá, Innside by Sol ~~Melía~~Meliá, Tryp, Sol ~~Melía~~Meliá, Sol ~~Melía~~Meliá Vacation Club, and Paradisus brands. The Paradisus brand represents all-inclusive luxury resorts with hotels in Mexico and the Dominican Republic.

~~Since~~However, since the completion date for the Paradisus Papagayo Bay Resort & Luxury Villas development has been delayed tountil the ~~fourth quarter~~middle of ~~2018,~~2020 it is no longer possible for the Company ~~reached~~to anfufill ~~agreement~~the performance conditions agreed in its most recent amendment with Meliá dated April 28, 2016,. toThe ~~amend~~amendment to the original agreement with Meliá, dated March 8, 2011., ~~The current agreement~~ stipulates the following ~~major~~ conditions:

a. ~~New~~Completion ~~completion~~ date: September 15, 2018 (subject to force majeure)

b. Should the completion not occur by September 15, 2018, and ~~should~~if the parties have not have agreed ~~in writing~~ to an extension toby such date, ~~after September 15, 2018,~~ the Company will be required to pay ~~Melía~~Meliá ~~a daily amount of~~ $2,000 asa ~~liquidate~~day din liquidated damages.

c. Should the completion not occur by November 15, 2018, and should ~~the~~Meliá ~~parties to the management agreement~~ not agree to ana etime ~~xtension~~extension, the Company will be obligated to pay Meliá $5,000,000 asin liquidated damages.

~~Since~~No ~~the~~amendment ~~dates~~to ~~stipulated in~~ the ~~most~~management ~~recent~~ agreement with ~~Melía~~Meliá ~~are~~has ~~unlikely~~been toreached, benor ~~realized~~have ~~the~~we ~~Company~~engaged ~~understands~~an ~~that.it will~~alternative bemanagement ~~necessary~~company for tothe ~~draft~~project. ~~and~~Based ~~sign~~on anour ~~8th~~current ~~Addendum~~agreement with ~~Melia.~~Meliá, ~~The~~the Company ishas ~~confident~~recognized ~~that~~a itprovision ~~will~~for beliquidated ~~able~~damages in tothe ~~achieve~~amount ~~this objective~~of in$5,120,000 ~~due~~as ~~course~~of March 31, 2018 and December 31, 2017.

Additional Concession Properties

On April 24, 2013, the Company entered into new agreements for the purchase of two additional concession properties located in Polo Papagayo, Guanacastefor a total of $17,500,000. The terms of the agreements included amounts payable to the seller and a third party against a refundable deposit of $1,369,816 minus a non-refundable amount of $300,000 and a liqudated damages penalty of 5% in the event the purchase did not close. The Company failed to perform according to the terms of the purchase agreements and the transaction was terminated by the third party and thereafter by the Company.

Finance

The anticipated completion of the Paradisus Papagayo Bay Resort & Luxury Villas by mid-2020 will require a net investment of approximately $~~217~~215 million (excluding non-recuperated overhead expenses), of which approximately $7362 million (excluding capitalized interest) has been expended as of ~~September 30~~March 31, ~~2017~~2018. We aim to realize a minimum of $~~140~~150 million in new funding over the next ~~six~~twelve months. New funding over the next ~~six~~twelve months is expected to be raised from debt financing through bonds, shareholder loans and, if necessary, the guaranty agreement borne by certain principal shareholders and participants in management. Detailed below is a brief description of material debt obligations as of period end.

3431

Bonds:

~~The~~SunVesta ~~Company~~AG, has ~~four~~five bond issues outstanding as of March 31, 2018, all denominated in Swiss Francs (CHF).

~~Swiss~~Convertible ~~Francs~~Bond ~~(CHF)~~I ~~Convertible Bonds~~

The Company initiated an offering of senior unsecured CHF bonds on October 1, 2015, of up to CHF 1545,000,000 in units of CHF 5,000 that bear interest at 6.00% per annum payable each September 30, over a three-year term that ~~matures~~mature on September 30, 2018, ~~which are~~ convertible into shares of SunVesta Holding AG at CHF 8.00. Wea ~~had~~share ~~realized~~at ~~$3,816,061~~the asdiscretion of ~~September~~the ~~30,~~bondholder. ~~2017~~As ~~and~~of $3March 31,~~648~~ 2018,~~383 as~~ ofand December 31, ~~2016~~2017, inrespectively, ~~connection~~$2,381,127 ~~with~~and ~~this~~$2,325,707 ~~offering~~was outstanding.

~~The~~Convertible ~~Company~~Bond initiated a parallel offering of senior unsecured CHF bonds on October 1, 2015, of up to CHF 45,000,000 in units of CHF 5,000 that bear interest at 6.00% per annum payable each September 30, over a three-year term that matures on September 30, 2018, which are convertible into shares of SunVesta Holding AG at CHF 8.00. We had realized $9,050,313 as of September 30, 2017 and $36,770,369 as of December 31, 2016, in connection with this offering. Included in these amounts was approximately $6.2 million (CHF 6.32 million) that by agreement with certain bondholders deviated from the standard terms to provide for repayment by February 28, 2017.II

~~Swiss~~The ~~Francs~~Company (initiated a parallel offering of senior unsecured CHF) ~~Bonds~~bonds on October 1, 2015, of up to CHF 15,000,000 in units of CHF 5,000 that bear interest at 6.00% per annum payable each September 30, over a three-year term that matures on September 30, 2018, convertible into shares of SunVesta Holding AG at CHF 8.00 a share at the discretion of the bondholder. As of March 31, 2018, and December 31, 2017, respectively, $9,206,578 and $9,012,791 was outstanding.

~~The Company initiated a new offering of senior unsecured~~ CHF ~~bonds on September 21, 2016, of up to CHF 20,000,000 in units of CHF~~ ~~5,000~~Bond ~~that~~III ~~bear~~original ~~interest at 6.50% per annum payable each August 15, over a four-year term that matures on August 15, 2020. We had realized $2,519,605 as of September 30, 2017 and $15,601,389 as of December 31, 2016.~~

The Company initiated aan ~~new parallel~~ offering of senior unsecured CHF bonds on September 21, 2016, of up to CHF 20,000,000 in units of CHF 5,000 that bear interest at 6.50% per annum payable each August 1615, over a four-year term that matures on August 15, 2020. As Weof ~~had~~March ~~realized~~31, $12018,~~048,284~~ ofand ~~September~~December 3031, 2017, ~~and~~respectively, $~~961~~11,~~595~~176,613 asand ~~of December 31~~$3,744,697 ~~2016~~was outstanding.

~~The~~CHF ~~Company~~Bond ~~initiated~~III ~~a new~~ parallel offering of senior unsecured CHF bonds on March 6, 2017, of up to CHF 50,000,000 in units of CHF 1,000 that bear interest at 6.50% per annum payable each May 1, over a five-year term that matures on August 15, 2022. We had realized $27,960,026 of September 30, 2017.

~~Aires~~The ~~International~~Company ~~Investment~~initiated a parallel offering of senior unsecured CHF bonds on September 21, ~~Inc~~2016, of up to CHF 20,000,000 in units of CHF 5,000 that bear interest at 6.50% per annum payable each August 15, over a four year term that matures on August 15, 2020. As of March 31, 2018, and December 31, 2017, respectively, $1,071,408 and $1,046,471 was outstanding.

OnCHF ~~July~~Bond ~~27,~~IV 2011, SunVesta AG entered into a line of credit agreement with Aires International Investments Inc. (“Aires”), a company owned by Dr. Rӧssler (a director of the Company). The credit line was amended and then replaced by a new loan agreement on December 31, 2016, that includes the following conditions:

—The Company ~~All~~initiated ~~existing~~a ~~loan agreements or credit facilities, including amendments, between SunVesta AG and Aires were cancelled and superseded by the~~ new ~~loan~~offering ~~agreement.~~of —senior ~~The~~unsecured ~~loans~~CHF ~~are~~bonds ~~due~~on ~~after~~March ~~December 31~~6, ~~2020 and before December 31~~2017, ~~2022.~~of —up ~~After~~to ~~December 31~~CHF 50, ~~2020~~000,000 ~~Aires~~in ~~has~~units ~~the option to cancel the loan agreement with a prior notice period~~ of ~~90 days~~CHF 1,000 ~~requiring~~that ~~repayment~~bear ofinterest ~~the~~at ~~loans in full~~6.50% —per ~~SunVesta~~annum AGpayable ~~has~~each ~~the~~May ~~right~~1, toover ~~repay~~a ~~the~~five-year ~~loan~~term atthat ~~any~~matures ~~time~~on ~~with~~August a15, ~~prior~~2022. ~~notice~~As ~~period~~ of 90March 31, ~~days.~~2018, —and ~~Loan~~December ~~amounts~~31, ~~outstanding~~2017, ~~including~~respectively, ~~any~~$29,168,271 ~~additional amounts~~ and ~~additions are subordinated. — Interest on the loan amounts is 7.25% per annum~~$28,468,904 ~~which~~was ~~is accrued to the loan account~~outstanding.

~~The~~Aires ~~Company~~International ~~had borrowed $56~~Investment,~~684,218~~ ~~from Aires as of September 30, 2017 and $51,473,793 as of December 31, 2016~~Inc.:

35The Company has entered into a loan agreement with Aires International Investments Inc. (“Aires”), a company owned by Dr. Rӧssler (a director of the Company and related company). The Company had borrowed $59,982,381 from Aires as of March 31, 2018 (including accrued interest of $14,029,380). The loan is dominiated in Swiss Francs.

~~Loan Global Care AG~~32

InThe ~~2017,~~loan ~~Global~~agreement ~~Care~~includes ~~AG, a company owned by Dr. Rӧssler (a director of~~ the ~~Company),~~following ~~provided $36,469,014 to the Company at 7.25% interest, repayable not before December 31, 2020.~~conditions:

~~Promissory Note~~— ~~Blue~~Aires ~~Dot~~loan SAamounts ~~(formerly~~outstanding ~~DIA~~including Sany additional amounts and additions are subordinated to all other existing and future claims against the Company.A) In the event of insolvency proceedings and the execution of a composition agreement with an assignment of assets, Aires would waive its claims to the extent necessary that the claims of all other creditors, and the costs of the liquidation, debt moratorium or insolvency proceedings, are covered in full by the proceeds of the liquidation of the Company. Further, the claims and interests of Aires are deferred for the duration of the subordination agreement. None of the claims covered by the subordination agreement may be paid, settled by offsetting or replacement/ novation, or newly secured, either in full or in part. The subordination agreement can only be terminated under restrictive preconditions.

~~On March~~— 8,Interest ~~2013,~~on the ~~Company entered into an interest free~~ loan ~~agreement~~amounts ~~with~~is ~~Blue~~7.25% ~~Dot~~per SAannum, ~~(formerly~~which ~~DIA~~charge ~~SA)~~is ~~(“Blue Dot”) in connection with the purchase of the land concession for the Paradisus Papagayo Bay Resort & Luxury Villas project~~accrued.

OnLoan ~~September~~Global ~~21,~~Care ~~2016, the Company signed a new agreement, which stipulated that the total amount of $2,000,000 was repayable in four quarterly installments of $500,000 each, starting on November 21, 2016.~~AG:

~~The~~As ~~Promissory~~of ~~Note~~March 31, 2018, the loan due to ~~Blue~~Global ~~Dot~~Care ~~was~~AG ~~fully~~(an ~~paid~~entity ascontrolled by Dr. Max Rössler, a director of ~~September~~the 30Company and related party) amounts to $39,526,331 ~~2017~~at 7.25%. AsThereof, of$22,646,453 is subordinated to all other existing and future claims against the Company, on the same terms and conditions as those agreed for amounts due to Aires. The remaining amounts are due not before December 31, ~~2016~~2020, ~~the~~and ~~outstanding~~at ~~amount~~latest ~~was~~by $1December 31,~~500,000~~ 2022. The loan is denominated in Swiss Francs.

Results of Operations

During the ~~nine~~three-month period ended ~~September~~March 3031, ~~2017~~2018, our operations ~~were~~ focused on (i) completing ~~earth~~and ~~work~~restoring ~~excavations~~prior onearthwork; ~~the~~(ii) ~~Paradisus~~pursuing ~~Papagayo~~additional ~~Bay~~debt ~~Resort~~financing &to ~~Luxury~~fund ~~Villas~~construction ~~property~~of the project; and (iiiii) furthering discussions with prospective project development ~~partners; and~~ ~~(iii) pursuing additional debt financing to fund the construction of the project~~partners.

The Company has been funded since inception from debt or equity placements and by shareholders or partners in the form of loans. Capital raised to date has been ~~allocated~~used ~~primarily~~ to ~~the~~develop ~~development of~~ the Costa Rican property, including for the purchase of ~~the~~ land ~~and~~ concessions, earthwork, and general and administrative costs.

Comprehensive Losses

The variance in losses over the comparative ~~nine~~three- month periods is reconciled:

Three months July 1 to September 30 2016		(3,371,991	)
Three months January 1 to March 31, 2017	(3,638,549	)
Variances during the 3 months
Variances:
Increase in general and administrative expenses		(668,516	)	Increase in consulting expenses over the previous year
Decrease in general and administrative expenses	422,468		Less consulting, travel and personnel expenses
Increase in interest income		14,326		Immaterial
Decrease in foreign exchange result	(384,130	)	Currency fluctuations
Increase in interest expenses		(89,871	)	Increase in overall debt obligations.
Decrease in foreign exchange translation result (OCI)	(1,128,192	)	Currency fluctuations
Change in fair values of conversion features		(368,915	)	Decrease in gain due to lower volume change in conversion feature in 2017
Decrease in impairment expenses	280,242		In 2017, the loan due from REP Caribbean was impaired
Loss on extinguishment of debt		(106,762	)	Negative impact from debt extinguishment in 2017
Change in fair values of conversion features	(346,235	)	Less gain due to lower volume on conversion feature in 2018
Increase in foreign exchange exchange gains		2,030,920		Currency fluctuations
Increase in interest expenses	(1,062,467	)	More debt in 2018. Additionally, there was a change in the calculation of the interest accrual in 2017, resulting in lower expenses in 2017.
Increase in other income/(expenses)		(7,747	)	Immaterial
Decrease in other income/(expenses)	274,400		Gain on settlement of salary accrual
Income Taxes		(1,305	)	Immaterial
Increase in interest income	1,140		not material
Increase in foreign currency translation gains		1,359,710		Currency fluctuations
Total variances	(1,942,774	)
Total variances		2,161,842
Three months January to March 31, 2018	(5,581,323	)
Three months July to September 2017		(1,210,149	)

~~We did not generate revenue during this period and we expect to continue to incur losses through the year ended December 31, 2017.~~33

36We did not generate revenue during this period and we expect to continue to incur losses through the year ended December 31, 2018.

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 inception to ~~September~~March 3031, ~~2017~~2018, in connection ~~with~~ with the purchase of land concessions in Costa Rica, as well as the planning and construction of the project and expects to incur ~~future~~ future cash outflows on capital expenditure as discussed in the "Liquidity and Capital Resources" and the "Going Concern" paragraphs below.

Liquidity and Capital Resources

Since inception the Company has experienced significant changes in liquidity, capital resources, and stockholders, equity.

As of ~~September~~March 3031, ~~2017~~2018, and December 31, ~~2016~~2017, the following were working capital items:

	September 30, 2017			December 31, 2016
	March 31, 2018			December 31, 2017
Current assets
Cash and cash equivalents		4,~~553~~356,~~872~~184			~~806~~4,~~440~~058,982
Receivable from related parties		—			49,292
Other assets		861,872			772,182
Other assets		737,459			456,099
Total current assets		5,218,056			4,831,164
Total current assets		5,291,330			1,311,830
Current liabilities
Accounts payable		21,~~312~~388,~~044~~449			31,~~311~~796,~~512~~917
Accrued expenses		3,~~453~~946,~~700~~921			3,~~160~~083,~~723~~132
Notes payable		—			1,500,000
Bonds		11,382,794			11,032,145
Notes payable to related parties		—			307,088
Liability related to conversion feature		629,373			922,087
Bonds		12,711,869			6,687,384
Provisions for liquidated damages		5,120,000			5,120,000
Liability related to conversion feature		1,334,210			—
Other liabilities		47,522			28,720
Other liabilities		26,013			120
Total current liabilities		22,515,058			21,983,000
Total current liabilities		19,837,837			14,966,826
Net working capital		(17,297,003	)		(17,151,837	)
Net working capital		(14,546,506	)		(13,654,996	)

AsThe Company’s negative net working capital of ~~September~~$17.3 ~~30,~~million ~~2017,~~is ~~and~~a ~~December~~significant ~~31,~~concern ~~2016~~of management going forward. Nevertheless, based on the ~~following~~guaranty ~~were~~signed by certain principals, the ~~items~~Company ~~making~~believes upthat ~~the~~it ~~total~~can ~~stockholders,~~address ~~deficit:~~prospective liquidity problems in future periods.

	September 30, 2017			December 31, 2016
Assets
Current assets		5,291,330			1,311,830
Non-current assets		75,793,413			68,354,502
Total assets		81,084,743			69,666,332
Liabilities
Current liabilities		19,837,837			14,966,825
Non-current liabilities		123,433,720			105,872,146
Total liabilities		143,271,556			120,838,971
Total stockholders’ deficit		(62,186,813	)		(51,172,639	)

37As of March 31, 2018 and December 31, 2017, the following line items amount to the total stockholders’ deficit:

The Company’s negative net working capital of $14,546,506 is a concern going forward. However, based on the guaranty signed by certain principals, the Company believes that it can address liquidity problems.

	March 31, 2018			December 31, 2017
Assets
Current assets		5,218,056			4,831,164
Non-current assets		81,463,426			78,945,277
Total assets		86,681,482			83,776,440
Liabilities
Current liabilities		22,515,058			21,982,999
Non-current liabilities		139,794,150			131,893,157
Total liabilities		162,309,208			153,876,156
Total stockholders’ deficit		(75,627,726	)		(70,099,716	)
Subordinated debt		82,628,834			79,339,011
Surplus		7,001,108			9,239,295

Net cash flow used in operating activities for the ~~nine~~three-month period ended ~~September~~March 3031, ~~2017~~2018, was $81.1 million,~~447,232,~~ as compared to ~~$6,053,988~~ $3.3 million for the ~~nine~~three-month period ended ~~September~~March 3031, ~~2016~~2017.

We expect to continue to use net cash flow in operating activities until we complete the Paradisus Papagayo Bay Resort & Luxury Villas project, ~~which~~and realize revenue from the operation of the project. The completion date is projected ~~for~~to ~~the~~be ~~fourth~~by ~~quarter~~the ofmiddle ~~2018~~of 2020.

Net cash used in investing activities for the ~~nine~~three-month period ended ~~September~~March 3031, ~~2017~~2018, was $~~3,612,539~~1.6 million as compared to $~~1,480,178~~0.6 million for the ~~nine~~three-month period ended ~~September~~March 3031, ~~2016~~2017. Net cash used in investing activities in the current ~~nine~~three-month period is mainly comprised of the purchase of property ~~and equipment~~, ~~offset~~plant byand ~~the sale of~~ equipment. Net cash used in investing activities in the prior comparable ~~nine~~three-month period was similarly mainly comprised of the purchase of property, plant and equipment, ~~and deposits related to construction,~~ offset by ~~receivables~~proceeds from ~~related~~the ~~parties~~sale ~~and~~of ~~restricted cash~~property.

We expect negative net cash flow in investing activities to continue while in the process of developing the Paradisus Papagayo Bay Resort & Luxury Villas.

Net cash provided by financing activities for the ~~nine~~three-month period ended ~~September~~March 3031, ~~2017~~2018, was $~~15,789,566~~2.9 million as compared to $~~10,382,963~~5.7 million ~~for~~in the ~~nine~~three-month period ended ~~September~~March 3031, ~~2016~~2017. Net cash provided by financing activities in the current ~~nine~~three-month period is mainly comprised of proceeds from notes payable to related parties~~, proceeds from bond issuances net of commissions, and proceeds from other debt, offset by repayments of bonds and other debt~~. Net cash provided by financing activities in the prior comparable ~~nine~~three-month period was mainly comprised of proceeds from notes payable to related parties, and proceeds from bond issuances net of commissions, offset by the ~~decrease~~repayment inof ~~bank~~bonds ~~liabilities~~ and ~~the repayment of~~ other debt.

We expect net cash flow provided by financing activities to continue due to the financing necessary to complete the development of the Paradisus Papagayo Bay Resort & Luxury Villas.

Management believes that cash on hand, related party loans, current bond offerings and the assurance of the Guaranty Agreement as described in the going concern paragraph below are sufficient for us to conduct operations over the next twelve months.

We had no formal lines of credit or other bank financing arrangements as of ~~September~~March 3031, ~~2017~~2018.

We have commitments that include an award letter issued in favor of certain general contractors together with purchase orders and related agreements for $~~130~~150 million as of ~~September~~March 3031, ~~2017~~2018, in connection with the development of the Paradisus Papagayo Bay ~~Resort~~ Resort & Luxury Villas, which commitments are included in the required estimated net financing of $~~217~~215 million to complete the project.

~~We maintain a defined benefit plan that covers all of our Swiss employees.~~35

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.

We ~~have~~maintain noa ~~current~~defined ~~plans~~benefit toplan ~~make~~that ~~any~~covers ~~changes~~all ~~in the number~~ of our Swiss employees as of ~~September~~March 3031, ~~2017~~2018.

We have no current plans to make any changes in the number of our employees as of March 31, 2018.

Off-Balance Sheet Arrangements

As of ~~September~~March 3031, ~~2017~~2018, we had no significant off-balance sheet arrangements that have or are reasonably likely to have a current or 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 is currently working on building a ~~resort~~hotel in the Papagayo Gulf Tourism Project area of Guanacaste, Costa Rica. The project is ~~not~~ expected to open ~~before the end of 2018~~mid-2020. Until the completion of the project, the following expenditures are estimated to be incurred:

a.	Gross project cost	~~Gross project cost~~	$	$240,000,000	~~242,000,000~~
b.	Less: Proceeds from sale of villas	~~Less: Proceeds from sale of villas~~		(25,000,000	~~(25,000,000~~)	)
c.	Net project cost	~~Net project cost~~		215,000,000	~~217,000,000~~
d.	Overhead expenses	~~Overhead expenses~~		20,000,000	~~20,000,000~~
e.	Total, excluding other potential projects	~~Total, excluding other potential projects~~	$	$235,000,000	~~237,000,000~~

~~Seventy~~Sixty to seventy percent of the net project cost is intended to be financed through the issuance of secured ~~bonds~~debt facilities, for which negotiations are in progress. The remaining thirty to forty percent of the net project cost, as well as non-recuperated overhead expenses are intended to be financed by the main shareholders or lenders of the project, i.e ~~Dr.~~ Hans Rigendinger, shareholder, Company Director and Chief Executive Officer, and Dr. Max Rӧssler, controlling shareholder of Aires International Investment Inc. and Global Care AG as well as Company Director.

On July 16, 2012, certain principal shareholders of the Company or principal lenders to the project entered into a Guaranty Agreement in favor of the Company. The purpose of the guaranty is to ensure that until such time as financing is secured for the entire project that ~~signatores~~ they will act as guarantors to creditors of SunVesta Holding AG ~~to the extent of the project’s ongoing capital requirements~~.

OnThe ~~October~~Guaranty ~~28,~~Agreement ~~2016~~requires that within 30 days of receiving a demand notice, ~~Dr.~~requested ~~Hans~~funds ~~Rigendinger~~are ~~and~~made Dravailable by the guarantors to the Company. ~~Max~~Based ~~Rössler~~on ~~formally~~this ~~agreed~~guaranty, management believes that available funds are sufficient to ~~maintain~~finance cash flows for the twelve ~~guaranty,~~months assubsequent ~~necessary~~to March 31, ~~until completion~~2018, ofand the ~~construction~~filing ofdate, though future anticipated cash outflows for constructing the Paradisus Papagayo Bay Resort & Luxury Villas, ~~after~~continue ~~which~~to ~~date~~depend on the ~~guaranty~~availability ~~will~~of ~~expire~~third party financing.

~~The~~On ~~Guaranty~~October ~~Agreement~~28, ~~requires~~2016, ~~that~~Hans ~~within~~Rigendinger 30and ~~days~~Dr. ofMax ~~receiving~~Rössler aformally ~~demand~~agreed ~~notice,~~to ~~requested~~maintain ~~funds are made available by~~ the ~~guarantors to the Company. Based on this~~ guaranty, ~~management~~as ~~believes~~necessary, ~~that~~until ~~available~~completion of ~~funds~~the ~~are~~construction ~~sufficient~~of toParadisus ~~finance~~Papagayo ~~cash~~Bay ~~flows~~Resort ~~for~~& ~~the twelve~~Luxury ~~months subsequent to September 30~~Villas, ~~2017~~after ~~and~~which date the ~~filing~~guaranty ~~date~~will expire.

Forward-Looking Statements and Factors That May Affect Future Results and Financial Condition

The statements contained in the section titled Management’s 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. 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 complete the Paradisus Papagayo Bay Resort
—	our ability to generate revenues to fund future operations
—	the volatility of the stock market
—	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 elsewhere in this report. 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 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~~required.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

InBased ~~connection~~on ~~with the preparation of this current report,~~ an evaluation ~~was~~under ~~carried~~the ~~out~~supervision byand with the participation of Company’s management, ~~with~~ the ~~participation~~Company’s ~~of its chief~~ principal executive officer and ~~chief~~principal financial officer, ofhave ~~the~~concluded ~~effectiveness~~that of the Company'’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (“Exchange Act”)~~). Disclosure~~ ~~controls~~were ~~and~~effective as ~~procedures~~of ~~are~~March ~~designed~~31, 2018, to ensure that information required to be disclosed by the Company in reports ~~filed~~that it files or ~~submitted under~~submits under the Exchange Act is (i) recorded, processed, summarized, and reported within the time periods specified in the Commission~~’s rules~~ rules and forms, and ~~that~~(ii) ~~such information is~~ accumulated and communicated to the Company’s management, including ~~the~~its chief executive officer and ~~chief~~ principal financial officer, as appropriate to allow timely decisions regarding required ~~disclosures~~disclosure.

~~Based~~Changes ~~on that evaluation, the Company’s management concluded, as of the end of the period covered by this report, that the Company’s disclosure controls and procedures were not effective~~ in ~~recording,~~Internal ~~processing,~~Control ~~summarizing,~~over ~~and~~Financial ~~reporting~~Reporting information required to be disclosed, within the time periods specified in the Commission’s rules and forms, and that 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~~During the second quarter ended March 31, 2018, there were no changes in ~~Internal~~the ~~Control~~Company’s internal control over ~~Financial~~financial ~~Reporting~~reporting identified in connection with management’s evaluation required by paragraph (d) of Rules 13a-15 under the Exchange Act that have materially affected, or are reasonably likely to materially affect our internal control over financial reporting.

During the quarter ended September 30, 2017, 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.37

40PART II – OTHER INFORMATION

~~PART II~~ –ITEM ~~OTHER~~1. ~~INFORMATION~~LEGAL PROCEEDINGS

~~ITEM 1~~None. ~~LEGAL PROCEEDINGS~~

~~The Company~~ ~~initiated~~ITEM ~~legal proceedings against Meridian IBG, Inc~~1A. ~~(“Meridian”)~~RISK on April 21, 2017, in the Hennepin County District Court, Fourth Judicial District. The claim was based on Meridian’s alleged failure to perform according to the terms of a purchase and sale agreement dated April 24, 2013, pursuant to which Meridian was to return deposits in the amount of $1,669,701 paid against the purchase of certain properties in Guanacaste, Costa Rica on providing notice of cancellation minus 5% in liquidated damages. The Company sought return of the deposits, interest on the deposits and expenses accrued in pursuing its claim. Meridian did not respond to the Companys complaint and filed a motion to dismiss. On September 12, 2017, the court granted Meridian’s motion, without prejudice, on the grounds that Minnesota state courts were not an appropriate venue for the ligitation. The Company is assessing whether to file a new complaint against Meridian in a different venue.FACTORS

~~ITEM~~Not ~~1A.~~required ~~RISK~~of ~~FACTORS~~smaller reporting companies.

~~Not required~~ ofITEM ~~smaller~~2. ~~reporting~~RECENT ~~companies.~~SALES OF UNREGISTERED SECURITIES

~~ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS~~None

~~On August~~ ~~23,~~ITEM ~~2017, the Company authorized the issuance of 2,900,000 shares of restricted common stock valued at $0~~3.07 aDEFAULTS ~~share~~ON ~~to certain~~SENIOR individuals, earned in connection with either an employment agreement or service to the board of directors, in reliance on the exemptions from registration provided by Section 4(2) and Regulation S of the Securities Act of 1933, as amended (“Securities Act”) as follows:SECURITIES

Name

Consideration

Value

Exemption

Hans Rigendinger

2,500,000

Employment Agreement

0..07

Section 4(2)/Reg S

José Maria Figueres

200,000

BOD Services

0..07

Section 4(2) Reg S

Howard Glicken

200,000

BOD Services

0..07

Section 4(2)

None

~~The Company~~ ~~complied~~ITEM ~~with the exemption requirements of Section~~ 4(2) of the Securities Act based on the following factors: (1) the issuances were isolated private transactions that did not involve a public offering; (2) the offerees had access to the kind of information which registration would disclose; (3) the offerees were financially sophisticated; and (4) all of the offerees serve the Company as either officers, directors or both. ~~The~~MINE ~~Company~~SAFETY also complied with the exemption requirements of Regulation S, where applicable, with no offering efforts in the United States, offering securities only to offerees who were outside the United States, and ensuring that the offerees to whom the securities were offered were non-U.S. offerees with addresses in foreign countries. The shares were issued to the respective offerres subsequent to period end.DISCLOSURES

~~ITEM~~Not 3applicable. ~~DEFAULTS ON SENIOR SECURITIES~~

~~None~~ ITEM 5. OTHER INFORMATION

~~ITEM~~On December 27, 2017, the Company issued 400,000 shares of restricted common stock for certain individuals, earned in connection with service to the Board of Directors, in reliance upon the exemptions from registration provided by Section 4(2) and Regulation S of the Securities Act of 1933, as amended (“Securities Act), The issuances were previously reported on Form 10-K filed with the Commission on March 30, 2018. ~~MINE~~Subsequent ~~SAFETY~~to ~~DISCLOSURES~~the issuance, the Company received the resignation of those individuals from the Board of Directors thereby nullifying an annual retention award. On January 1, 2018, the 400,000 shares were cancelled and returned to authorized share capital.

~~Not applicable~~ ITEM 6. EXHIBITS

~~ITEM~~Exhibits 5.required ~~OTHER~~to ~~INFORMATION~~be attached by Item 601 of Regulation S-K are listed in the Index to Exhibits on page 40 of this Form 10-Q, and are incorporated herein by this reference.

~~None~~38

~~ITEM 6. EXHIBITS~~ SIGNATURES

~~Exhibits~~Pursuant ~~required~~ to bethe ~~attached~~requirements byof ~~Item~~the ~~601~~Securities ofExchange ~~Regulation~~Act ~~S-K~~of ~~are~~1934, ~~listed~~the inregistrant ~~the~~has ~~Index~~duly tocaused ~~Exhibits~~this onreport ~~page~~to 44be ofsigned ~~this~~on ~~Form~~its ~~10-Q,~~behalf ~~and~~by ~~are~~the ~~incorporated~~undersigned, ~~herein~~thereunto byduly ~~this reference~~authorized.

SunVesta, Inc.		Date

/s/ Hans Rigendinger		May 10, 2018
Hans Rigendinger
Chief Executive Officer, Chief Financial Officer
Principal Accounting Officer and Director

~~SIGNATURES~~39

~~Pursuant~~INDEX toTO ~~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.~~EXHIBITS

		Sunvesta, Inc.
Exhibit	Description
Date: November 13, 2017		/s/ Hans Rigendinger
3.1.1*	Articles of Incorporation (incorporated by reference from the Form 10-SB filed with the Commission on December 31, 1999).
		Hans Rigdendinger
3.1.2*	Amended Articles of Incorporation (incorporated by reference from the Form 10-KSB filed with the Commission on April 9, 2003).
		Chief Executive Officer, Chief Financial Officer
3.1.3*	Amended Articles of Incorporation (incorporated by reference from the Form 10-QSB filed with the Commission on November 17, 2003).
		Principal Accounting Officer and Director
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.(incorporated by reference from the Form 8-K filed with the Commission on September 27, 2007).
10.3*	Guaranty Agreement dated July 16, 2012, between SunVesta, Mr. Mettler, Mr. Rigendinger and Dr.Rӧssler (incorporated by reference from the Form 10-K filed with the Commission on February 14, 2013).
10.4*	Employment Agreement dated January 1, 2013 between the Company and Hans Rigendinger (incorporatedb y reference to the Form 8-K filed with the Commission on February 4, 2013).
10.5*	Employment Agreement dated July 4, 2013 between the Company and Josef Mettler (incorporated by reference to the Form 10-Q filed with the Commission on October 10, 2013).
10.6*	Assignment of Debt Agreement dated December 31, 2012, between the Company, SunVesta AG and Aires International Investments, Inc. (incorporated by reference to the Form 10-Q filed with the Commission on December 13, 2013).
10.7*	Loan Agreement dated October 31, 2013, between SunVesta AG and Aires International Investments, Inc. (incorporated by reference to the Form 10-Q filed with the Commission on December 13, 2013).
10.8 *	Assignment of Debt Agreement dated December 31, 2013, between the Company, SunVesta AG and Aires (incorporated by reference to the Form 10-Q filed with the Commission on May 20, 2014).
10.9*	Assignment of Debt Agreement dated December 31, 2014, between the Company, SunVesta AG and Aires International Investments, Inc. (incorporated by reference to the Form 10-Q filed with the Commission on August 19, 2015).
10.10*	Addendum to Employment Agreement dated March 6, 2015, between the Company and Josef Mettler (incorporated by reference to the Form 10-Q filed with the Commission on May 5, 2015).
14*	Code of Business Conduct and Ethics adopted on July 16, 2015 (incorporated by reference to the Form 10-Q filed with the Commission on August 19, 2015).
21*	Subsidiaries of the Company (incorporated by reference to the Form 10-K filed with the Commission on March 30, 2018)
31	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.
32	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.
99*	SunVesta, Inc. 2013 Stock Option Plan (incorporated by reference to the Form 10-Q filed with the Commission on October 10, 2013).
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†

42* Incorporated by reference to previous filings of the Company.

~~INDEX TO~~ ~~EXHIBITS~~† 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.

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 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).
10.4*	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).

10.5* Guaranty Agreement dated July 16, 2012, between SunVesta AG, Jthe late osef Mettler, Hans Rigendinger and Max Rӧssler.

10.6* 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.

10.7* Employment Agreement dated July 4, 2013 between the Company and the late Josef Mettler (incorporated by reference to the Form 10-Q filed with the Commission on October 10, 2013).

10.8* Assignment of Debt Agreement dated December 31, 2012, between the Company, SunVesta AG and Aires International Investments, Inc. (incorporated by reference to the Form 10-Q filed with the Commission on December 13, 2013).

10.9* Debt Settlement Agreement dated December 31, 2012, between the Company and Hans Rigendinger (incorporated by reference to the Form 10-Q filed with the Commission on December 13, 2013).

10.10* Loan Agreement dated October 31, 2013, between SunVesta AG and Aires International Investments, Inc. (incorporated by reference to the Form 10-Q filed with the Commission on December 13, 2013).

10.11* Assignment of Debt Agreement dated December 31, 2013, between the Company, SunVesta AG and Aires International Investments, Inc.(incorporated by reference to the Form 10-Q filed with the Commission on May 20, 2014).

10.12* Assignment of Debt Agreement dated December 31, 2014, between the Company, SunVesta AG and Aires International Investments, Inc. (incorporated by reference to the Form 10-Q filed with the Commission on August 19, 2015).

10.13*	Addendum to Employment Agreement dated March 6, 2015, between the Company and the late Josef Mettler (incorporated by reference to the Form 10-Q filed with the Commission on May 5, 2015).
14*	Code of Business Conduct and Ethics adopted on July 16, 2015 (incorporated by reference to the Form 10-Q filed with the Commission on August 19, 2015).

21* Subsidiaries of the Company (incorporated by reference from the Form 10-K filed with the Commission on March 17, 2017).

31 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.

32 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.

99*	SunVesta, Inc. 2013 Stock Option Plan (incorporated by reference to the Form 10-Q filed with the Commission on October 10, 2013).
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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