SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

[X]  Quarterly Report under Section 13 or 15d of the Securities  Exchange Act of
     1934 for the quarterly period ended: September 30, 2000

[]   Transition report pursuant to Section 13 or 15d of the Securities  Exchange
     Act of 1934 For the Transition period from ________ to _________.


                         Commission file number: 333-45210


                               Supreme Hospitality
                               -------------------
             (Exact name of registrant as specified in its charter)


                             Formerly Richwood, Inc.
                            Formerly Grubstake, Inc.
                            ------------------------
                   (Former name if changed since last report)

       Nevada                                        88-0460457
---------------------------                 ------------------------------------
(State of incorporation)                    (IRS employer identification number)

                              41919 Skywood Drive
                            Temecula, CA 92591-1877
                            -----------------------
                    (Address of principal executive offices)

          Issuer's telephone number, including area code: 909-506-3435

Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the  Exchange  Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports),  and (2) has been
subject to such filing requirements for the past 90 days.

Yes   X     No
     ---       ---


State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:

TITLE OF EACH CLASS                            OUTSTANDING September 30, 2000
-------------------                            ---------------------------------
Common Stock, par value  $.0001                10,000,000 shares of common stock
Preferred Stock, par value  $.0001



Transitional Small Business Disclosure Format (check one)
Yes       No  X
    ---      ---





<PAGE>



                               SUPREME HOSPITALITY

                                      INDEX
                                                                        PAGE
                                                                        ----

PART I   FINANCIAL INFORMATION
------------------------------

Item 1.  Financial Statements

         Consolidated Balance Sheet as of September 30, 2000              4-5

         Consolidated Statements of Operations for the Nine Months        6
             Ended September 30, 2000

           Consolidated Statements of Cash Flows for the Nine Months
             Ended September 30, 2000                                     7

         Notes to Financial Statements                                    8

Item 2.  Management's Discussion and Analysis or Plan of Operation       12


PART II - OTHER INFORMATION
---------------------------

Item 1.  Legal Proceedings                                               14

Item 2.  Change in Securities                                            14

Item 3.  Defaults Upon Senior Securities                                 14

Item 4.  Submission of Matters to a Vote of Security Holders             14

Item 5.  Other Information                                               14

Item 6.  Exhibits and Reports on Form 8-K                                14

         Signature                                                       14






                                                                    Page 2 of 14


<PAGE>




WEBB & RITCHEY
--------------------------------------------------------------------------------

                                                    CERTIFIED PUBLIC ACCOUNTANTS
                                                      A Professional Corporation


December 2, 2000

The Board of Directors
Supreme Hospitality
Temecula, California

We have  prepared  the  accompanying  unaudited  consolidated  balance  sheet of
Supreme  Hospitality  as  of  September  30,  2000  and  the  related  unaudited
statements of income,  shareholder's  equity  (deficit),  and cash flows for the
nine months then ended.

Unaudited  financial  statements  are  limited  to  presenting  in the  form  of
financial  statements  information that is the representation of management.  We
have  not  audited  or  reviewed  the  accompanying  financial  statements  and,
accordingly, do not express an opinion or any other form of assurance on them.



/s/  Webb & Ritchey, CPAs
-------------------------------------------------------
     Webb & Ritchey, CPA'S - A Professional Corporation















--------------------------------------------------------------------------------
41661 Enterprise Circle No. # 211 o Temecula, CA  92690 o (909)296-9755


                                                                    Page 3 of 14


<PAGE>

<TABLE>

<CAPTION>



PART I - FINANCIAL INFORMATION

Item 1 - Financial Statements


                              Supreme Hospitality
                      Unaudited Consolidated Balance Sheet
                               September 30, 2000

                                                   Jun 30, '00                      Sep 30, '00
                                               ---------------------           ---------------------
<S>                                            <C>                             <C>

ASSETS
      Current Assets
          Cash                                 $             61,303            $             17,017
          Receivables                                        29,169                          29,234
          Other Current Assets                               17,404                          17,404
                                               ---------------------           ---------------------

      Total Current Assets                                  107,876                          63,655


      Property and Equipment
          Building                                        3,002,961                       3,002,961
          Furniture & Equipment                           1,009,722                       1,017,776
          Land                                            1,362,048                       1,362,048
          Land Improvements                                 344,714                         344,714
          Vehicles                                           24,199                          24,199
          Accumulated Depreciation                         (382,713)                       (438,036)
                                               ---------------------           ---------------------
      Total Property and Equipment                        5,360,931                       5,313,662


      Other Assets
          Deposits                                            7,200                           7,200
          Franchise Costs                                         -                          22,000
          Loan Fees, Net of Amortization                     46,525                          45,280
                                               ---------------------           ---------------------
      Total Other Assets                                     53,725                          74,480
                                               ---------------------           ---------------------

TOTAL ASSETS                                   $          5,522,532            $          5,451,797
                                               =====================           =====================
</TABLE>



                             SEE ACCOUNTANT'S REPORT



                                                                    Page 4 of 14

<PAGE>

<TABLE>

<CAPTION>

                              Supreme Hospitality
                      Unaudited Consolidated Balance Sheet
                               September 30, 2000

                                                                   Jun 30, '00                 Sep 30, '00
                                                          ---------------------       ---------------------
<S>                                                       <C>                         <C>

LIABILITIES & EQUITY
      Liabilities
          Current Liabilities
                  Accounts Payable                        $            178,170        $            170,055
                  Accrued Interest                                      38,602                      38,602
                  Accrued Other Liabilities                             26,434                      35,192
                  Guest Advance Deposits                                12,573                      12,260
                  Current Maturities-LT Debt                           299,686                     284,686
                                                          ---------------------       ---------------------

          Total Current Liabilities                                    555,465                     540,795

          Total Long Term Liabilities                                5,091,207                   5,066,071
                                                          ---------------------       ---------------------

      Total Liabilities                                              5,646,672                   5,606,866
      Shareholder Equity
          Common Stock                                                   1,000                       1,000
          Additional Paid In Capital                                    21,950                      32,327
          Retained Earnings                                           (147,090)                   (188,396)
                                                          ---------------------       ---------------------
      Shareholders' (Deficit)                                         (124,140)                   (155,069)

TOTAL LIABILITIES & SHAREHOLDERS' DEFICIT                 $          5,522,532        $          5,451,797
                                                          =====================       =====================


</TABLE>




                             SEE ACCOUNTANT'S REPORT




                                                                    Page 5 of 14


<PAGE>

<TABLE>

<CAPTION>

                               Supreme Hospitality
                  Unaudited Consolidated Statement of Net Loss
                  For the Nine Months Ended September 30, 2000

                                              Six Months            Nine Months
                                             Ending June 2000     Ending September 2000
                                             ----------------     ---------------------
<S>                                          <C>                  <C>

REVENUES                                     $     684,711        $     1,085,712


OPERATING EXPENSES
    Salaries                                       147,922                222,548
    Depreciation and amortization                  115,902                172,470
    Professional Fees                               67,719                 71,565
    Other Operating Expenses                        91,921                197,376
    Utilities                                       27,466                 46,106
    Payroll tax and personnel costs                 14,799                 19,836
    Repairs and Maintenance                         22,315                 40,605

TOTAL OPERATING EXPENSES                           488,044                770,506
                                             --------------       ----------------

INCOME FROM OPERATIONS                             196,667                315,206
                                             --------------       ----------------

OTHER EXPENSE
    Interest Expense                               287,257                422,602

NET LOSS BEFORE EXTRAORDINARY ITEMS          $     (90,590)       $      (107,396)

                                             --------------       ----------------
EXTRAORDINARY ITEM-Fee Paid to Underwriter         (56,500)               (81,000)
                                             --------------       ----------------

NET LOSS                                     $    (147,090)       $      (188,396)
                                             ==============       ================

EARNINGS (LOSS) PER COMMON SHARE
    Before Extraordinary Items               $      (0.009)       $        (0.012)
                                             ==============       ================

    On Net Loss                              $      (0.015)       $        (0.019)
                                             ==============       ================

</TABLE>



                             SEE ACCOUNTANT'S REPORT

                                                                    Page 6 of 14

<PAGE>

<TABLE>

<CAPTION>

                               Supreme Hospitality
                        Unaudited Statement of Cash Flows
                  For the Nine Months Ended September 30, 2000

                                                                                  Jun 30, '00                   Sep 30, '00
                                                                               ---------------        ----------------------
<S>                                                                            <C>                    <C>

CASH FLOWS FROM OPERATING ACTIVITIES
              Net Loss                                                               (147,900)                     (188,396)
              Adjustments to reconcile net (loss) to net cash
                    provided by operating activities
                    Depreciation                                                      133,886                       172,470
                    (Increase) decrease in:
                           Receivables                                                135,248                       (11,512)
                           Other Current Assets                                        (6,081)                       (1,906)
                    (Increase) decrease in:
                           Current Liabilities                                         69,426                        88,058
                                                                               ---------------        ----------------------
              Net cash provided by operating activities                               184,579                        58,714

CASH FLOWS FROM FINANCING ACTIVITIES
              Cash paid on long-term debt                                             (98,456)                     (144,685)
                                                                               ---------------        ----------------------
                    Net cash (used) by financing activities                           (98,456)                     (144,685)

CASH FLOWS FROM INVESTING ACTIVITIES
              Purchase of franchise                                                         -                       (22,000)
              Purchase of furniture and equipment                                      12,596                        (9,344)
              Cash received on note receivable-Shareholder                            (73,388)                       68,425
              Cash received from reqacquired common stock                              21,950                        51,886
                                                                               ---------------        ----------------------
                    Net cash provided by investing activities                         (38,842)                       88,967


NET INCREASE (DECREASE) IN CASH                                                        47,281                         2,996

BEGINNING CASH                                                                         14,021                        14,021
                                                                               ---------------        ----------------------
ENDING CASH                                                                    $       61,302         $              17,017
                                                                               ===============        ======================

                                                                               ---------------        ----------------------
Supplemental Disclosures - Cash paid for interest                              $      287,257         $             407,725
                                                                               ===============        ======================
</TABLE>



                             SEE ACCOUNTANT'S REPORT

                                                                    Page 7 of 14


<PAGE>



                               SUPREME HOSPITALITY
                          NOTES TO FINANCIAL STATEMENTS
                                   (UNAUDITED)


Note 1 - History And Organization Of The Company
------------------------------------------------

In the opinion of management,  the accompanying  unaudited  condensed  financial
statements   contain  all  adjustments  (all  of  which  were  normal  recurring
adjustments)  necessary  to present  fairly the  financial  position  of Supreme
Hospitality  (the  "Company")  at  September  30,  2000,  and the results of its
operations and its cash flows for the three months ended September 30, 2000. The
results of operations for the interim  periods ended  September 30, 2000 are not
necessarily indicative of the results to be expected for the full year.


The Company was  organized  November  10,  1997,  under the laws of the State of
Nevada as  GRUBSTAKE,  INC.  The  Company  currently  has no  operations  and in
accordance  with SFAS #7, is  considered a development  company.  On December 1,
1998,  the Company  changed its name to RICHWOOD,  INC. On April 17,  2000,  the
Company changed its name to SUPREME HOSPITALITY.


Note 2 - Unaudited Interim Financial Information
------------------------------------------------

The accompanying unaudited financial statements have been prepared in accordance
with generally accepted accounting principles for interim financial information.
Accordingly,  they do not include all the information and footnotes  required by
generally accepted accounting principles for financial  statements.  For further
information, refer to the audited financial statements and notes thereto for the
two months ending  February 29, 2000 for Temecula  Valley Inn, Inc., and for the
one month  ending  April  30,  2000 for  Supreme  Hospitality,  included  in the
Company's  Form 10SB12G/A  filed with the Securities and Exchange  Commission on
June 29, 2000.


Note 3 - Summary Of Significant Accounting Policies
---------------------------------------------------

Accounting Method
-----------------

The Company records income and expenses on the accrual method.

Estimates
---------

The preparation of financial  statements in conformity  with generally  accepted
accounting principles requires management to make estimates and assumptions that
affect  the  reported  amounts  of assets  and  liabilities  and  disclosure  of
contingent  assets and  liabilities at the date of the financial  statements and
the reported amounts of revenue and expenses during the reporting period. Actual
results could differ from estimates.

Cash and Equivalents
--------------------

The  Company  maintains  a cash  balance  in a  non-interest-bearing  bank  that
currently  does not exceed  federally  insured  limits.  For the  purpose of the
statements  of cash flows,  all highly liquid  investments  with the maturity of
three months or less are  considered to be cash  equivalents.  There are no cash
equivalents as of September 30, 2000.

Income Taxes
------------

Income  taxes are  provided  for using the  liability  method of  accounting  in
accordance with Statement of Financial Accounting Standards No. 109 (SFAS #109),
"Accounting for Income Taxes". A deferred tax asset or liability is recorded for
all  temporary  difference  between  financial and tax  reporting.  Deferred tax
expense  (benefit)  results from the net change  during the year of deferred tax
assets and liabilities.


                                                                    Page 8 of 14

<PAGE>

Reporting on Costs of Start-Up Activities , Loss Per Share, Year End
--------------------------------------------------------------------

Statement of Position  98-5 ("SOP  98-5"),  "Reporting  on the Costs of Start-Up
Activities" which provides guidance on the financial reporting of start-up costs
and organization costs. It requires most costs of start-up activities and
organization costs to be expensed as incurred.  SOP 98-5 is effective for fiscal
years beginning  after December 15, 1998.  With the adoption of SOP 98-5,  there
has been little or no effect on the company's financial statements.

Net loss per  share is  provided  in  accordance  with  Statement  of  Financial
Accounting  Standards No. 128 (SFAS #128)  "Earnings Per Share".  Basic loss per
share is computed by dividing  losses  available to common  stockholders  by the
weighted average number of common shares outstanding during the period.  Diluted
loss per share  reflects per share  amounts that would have resulted if dilative
common stock  equivalents  had been  converted to common stock.  As of April 29,
2000,  the  Company  had no  dilative  common  stock  equivalents  such as stock
options.

The Company has selected December 31, as its fiscal year-end.


Note 4 - Income Taxes
---------------------

There is no provision for income taxes for the period ended  September 30, 2000,
due to the net  loss  and no  state  income  tax in  Nevada,  the  state  of the
Company's domicile and operations.  The Company's total deferred tax asset as of
December 31, 1999 is as follows:

Net operation loss carryforward             $2,755
Valuation allowance                         $2,755

Net deferred tax asset                      $    0

The federal net operating loss carry forward will expire between 2018 and 2019.

This  carry  forward  may  be  limited  upon  the  consummation  of  a  business
combination under IRC Section 381.


Note 5 - Stockholders' Equity
-----------------------------

Common  Stock,  .0001  par  value,  50,000,000  shares  authorized,  issued  and
outstanding 10,000,000

10% Preferred Stock, .0001 par value,  dividends  cumulative,  convertible after
three years into common stock at a ratio of three shares of common stock for one
share of preferred stock authorized 1,000,000,000 shares, none issued


Note 6 - Warrants And Options
-----------------------------

There are no warrants or options outstanding to acquire any additional shares of
common or preferred stock.


Note 7 - Related Party Transactions
-----------------------------------

An officer of the  corporation  provides office  services  without charge.  Such
costs are immaterial to the financial statements and accordingly,  have not been
reflected  therein.  The officers  and  directors of the Company are involved in
other  business  activities  and may in the  future,  become  involved  in other
business  opportunities.  If a specific business  opportunity becomes available,
such  persons  may face a conflict  in  selecting  between the Company and their
other  business  interests.  The  Company  has not  formulated  a policy for the
resolution of such conflicts.


                                                                    Page 9 of 14

<PAGE>


Note 8 - Prior Interim Quarterly Statements
-------------------------------------------

The SEC  requires  if the  interim  period  is more  than  one  quarter,  income
statements  must also be provided  for the most recent  interim  quarter and the
comparable  quarter of the preceding  fiscal year.  The Company did not have any
activity prior to the reverse merger on April 17, 2000.


Note 9 - Material Subsequent Events
-----------------------------------

The Company on July 1, 2000 entered into a franchise  agreement with Days Inn of
America. The franchise fee is 8 1/2% of gross room revenues payable monthly. The
first two months  were  charged at a reduced  rate of 2%.  The  Company  expects
increased  room revenues due to Days Inn of America  national and  international
marketing programs.

Note 10 - History Of The Consolidated Companies And Basis Of Statements
-----------------------------------------------------------------------

Temecula Valley Inn, Inc. was effectively  incorporated as of January 1, 2000 by
acquiring  the net assets of a sole  proprietorship,  which owned and operated a
hotel in Temecula California.

On April 30, 2000 Supreme Hospitality  acquired Temecula Valley Inn, Inc. by way
of an exchange of 9,000,000 shares of Supreme Hospitality's common stock for all
of the  outstanding  stock of Temecula Valley Inn, Inc.  Immediately  before the
exchange on April 30,  2000,  Supreme  Hospitality  had  nominal  assets and was
dormant for all practical purposes. Thus, these statements are essentially those
of Temecula Valley Inn, Inc. which owned and operated  substantially  all of the
assets of the consolidated group before and after the exchange.

Management  feels that the proper  accounting  treatment of the  above-described
acquisition  is  that  of  a  reverse  acquisition,   or  purchase,  of  Supreme
Hospitality  by Temecula  Valley Inn, Inc.  Both the  historical  costs and fair
market value of Supreme  Hospitality  before the exchange were approximately the
same and these  statements  do not reflect any  revision in the value of Supreme
Hospitality.

These compiled financial  statements are presented as a consolidation of Supreme
Hospitality and its wholly owned subsidiary, Temecula Valley Inn, Inc.

These unaudited financial  statements rely for historical figures on an audit of
Supreme  Hospitality  as of April 29, 2000 by Barry L. Friedman,  PC,  Certified
Public  Accountant,  and an audit of  Temecula  Valley  Inn,  Inc.  by Nystrom &
Company LLP, Certified Public Accountants as of February 29, 2000.

Note 11 - Additional Paid In Capital
------------------------------------

The Company reacquired some 95,300 shares of outstanding common stock and resold
it. The sale, net of acquisition cost, yielded $51,886.

Note 12 - Underwriting And Franchise Costs
------------------------------------------

On July 12, 2000,  the Company  became  affiliated  with a national hotel chain,
Day's Inn World,  by  purchasing a franchise  from that entity for $22,000.  The
franchise is for an initial term of five (5) years,  with renewal  options.  The
Company will amortize these costs over 60 months.

The Company is presently in the process of making an initial public  offering of
it's 10%  Preferred  stock and has  advanced  the  underwriters  $81,000 for the
initial costs. These underwriting fees are reflected as an extraordinary expense
on these statements.

                                                                   Page 10 of 14


<PAGE>

<TABLE>

<CAPTION>


Note 13 - Long-Term Debt
------------------------
<S>                                                                               <C>

Long-term debt at September 30, 2000 consists of the following:

Note payable to Valley  Independent  Bank,  collateralized by the Company's real
property,  payable in monthly  installments  of $21,981,  including  interest at
prime plus 1%;  final  payment  due  April,  2006.  The prime rate at  September
30,2000 was 9.25%.                                                                $2,744,836

Note  payable  to  Temecula  Valley  Bank,  guaranteed  by  the  Small  Business
Administration, payable in monthly installments of $9,453, including interest at
prime plus 2%, final payment due February 2023,  collateralized by the Company's
real property. The prime rate at
September 30, 2000 was 9.50%.                                                        980,997

Note  Payable  to Donald  Corp,  payable  in  monthly  installments  of  $4,825,
including interest at 10%, final payment due February 2003,
collateralized by the Company's real estate.                                         486,901

Capital  lease  obligation  payable  to  Telerent  Leasing,  payable  in monthly
installments  of  $28,800,  including  interest  ranging  from  12.4% to  14.4%,
collateralized by assets leased from Telerent
Leasing.                                                                             988,044

Note  Payable  to  Eastern   Municipal  Water   District,   payable  in  monthly
installments  of $2,454,  including  interest at 10%, final payment due November
2023; in the event of default water
service could be discontinued.                                                        79,634

Unsecured note payable to City of Temecula, including interest at 8%. Payable in
full September 2000 but now extended to December 2000.                                55,637

Note payable to City of Temecula Valley Bank, payable in monthly installments of
$500,  including  interest at 8% per annum,  final payment due September,  2004,
collateralized by 2000 Chevrolet Impala                                               22,955
                                                                                  ----------

Total Long-term debt                                                               5,359,004

Less current maturities                                                              284,686
                                                                                  ----------

Long-term debt net of current maturities                                          $5,066,071
                                                                                  ----------
</TABLE>

Maturities  of long-term  debt for the 3 months ended  December 31, 2000 and the
five years following are as follows:

        2000 (three months)                   $  175,767
        2001                                     293,416
        2002                                     335,192
        2003                                     831,745
        2004                                     110,780
        2005                                      32,759
        Thereafter                             3,579,345
                                              ----------
         Total                                $5,359,004
                                              ----------


Note 14 - Property And Equipment
--------------------------------

Property and Equipment is stated at cost to the Company or it's predecessor sole
proprietorship.  Depreciation  is provided on the straight- line method over the
following estimated useful lives:

         Building and Improvements              40  years
         Land Improvements                    15-40 years
         Furniture and Equipment               7-10 years

Note 15 - Intangible Assets
---------------------------

Loan fees are being  amortized  over the terms of the  related  long-term  notes
payable on a straight-line basis.

                                                                   Page 11 of 14


<PAGE>


Item 2 - Management's Discussion And Analysis Or Plan Of Operations
-------------------------------------------------------------------

The Company  was  organized  for the purpose of creating a corporate  vehicle to
seek,  investigate and, if such investigation  warrants,  acquire an interest in
one or more  business  opportunities  presented to it by persons or firms who or
which desire to seek perceived  advantages of a publicity held  corporation.  On
April 30, 2000 the Company (SUPREME  HOSPITALITY)  acquired TEMECULA VALLEY INN,
INC., (a Nevada corporation) as a wholly owned subsidiary of Supreme Hospitality
in exchange of Common Stock,  Sub Curia.  The primary activity of the Company is
the  hospitality  business  for both the business  and leisure  traveler,  and a
90-room hotel was built and opened in1998.  The executive offices of the company
are located at 41919 Skywood Drive,  Temecula,  California  92591. Its telephone
number is (909) 506-3435.  Of the 50,000,000 shares of the SUPREME HOSPITALITY'S
Common  Stock,  1,000,000  are  currently  freely  tradable  under the Rule 144k
exemption  promulgated under the Securities Act of 1933. See Item 8 "Description
of Securities."

The Company may obtain funds for additional hotel construction or acquisition by
private  placements,  equity or debt issues.  Persons  purchasing  securities in
these placements and other  shareholders will likely not have the opportunity to
participate in the decision relating to any acquisition.  Investors will entrust
their investment monies to the Company's management before they have a chance to
analyze any  ultimate  use to which their  money may be put.  Consequently,  the
Company's  potential success is heavily  dependent on the Company's  management,
which  will  have  virtually   unlimited   discretion  in  new  construction  or
acquisition.

The Company plans to develop and construct  additional  properties in the future
and has an  option to  purchase  for  $1,300,000,  approximately  2.61  acres of
approved  hotel  property,  including  a complete  package  which  consists of a
business  plan,  construction  costs,  drawings,  etc.  This property is located
adjacent to Interstate 5 and Hilltop Drive in Redding,  California.  This parcel
is the last available hotel property in this immediate area. The current plan is
to exercise  the purchase  option and develop and build a 99-room  hotel on this
property. This development is anticipated to be the next development the Company
will  undertake.  The cost is estimated to be $5,850,000 for land,  building and
improvements.  This  property is included in the  financial  projections  and is
scheduled to commence operations in the fourth quarter of 2001.

The Company has identified  other  properties in the Temecula Valley of Southern
California to acquire,  develop and build hotels.  This will be done through the
raising of  additional  equity  funds.  An  additional  property in the Temecula
Valley is included on the  financial  projections  commencing  operations in the
third  quarter of 2002.  Development  cost for a 120-room  hotel is estimated at
$7,800,000 for land development, building and improvements.

The  management  of the  Company  believes  that the  Temecula  Valley area will
continue to see unprecedented  growth not seen since the mid 1980's. The Company
is poised to take  advantage  of that  growth,  given it can meet its  financial
requirements.

The Company  believes that through the  acquisition  of the land and  subsequent
development  of these  properties,  shareholder  value  will be  increased.  The
management  team has the expertise to identify prime  properties and negotiate a
fair price for the land and develop it and build a quality facility,  which will
increase in value.

As is customary in the industry, the Company may pay a finder's fee for locating
an  acquisition  prospect.  If any such fee is paid,  it will be approved by the
Company's  Board of  Directors  and  will be in  accordance  with  the  industry
standards.  Such  fees  are  customarily  between  1% and 5% of the  size of the
transaction,  based upon a sliding scale of the amount  involved.  Such fees are
typically in the range of 5% on a $1,000,000 transaction ratably down to 1% in a
$4,000,000 transaction. Management has adopted a policy that such a finder's fee
or real estate  brokerage fee could,  in certain  circumstances,  be paid to any
employee,  officer,  director or 5% shareholder  of the Company,  if such person
plays a material role in bringing in a transaction to the Company.


                                                                   Page 12 of 14

<PAGE>


Item 3 - Description Of Property
--------------------------------

A 90-room 3-story hotel, Temecula Valley Inn (TVI) in Temecula,  California, was
constructed  and opened  for  business  on  December  5, 1998.  It is one of the
premier hotel properties in the Temecula Valley.  Though cyclical in nature, the
TV's  occupancy  rates  have  continued  to  grow.  TVI  has  chosen  to  remain
independent  of any  national or regional  franchise in order to keep costs down
and allow for  autonomous  management  TVI has developed its own website to take
advantage  of the  growing  Internet  market.  The  property's  web  address  is
Www.temeculavalley.com.

The Company currently serves the business traveler who requires  perceived value
for  the  nightly  rate  he/she  pays.   Through  active  marketing  to  various
corporations the Company has been successful during its first year of operations
of  attracting  a  reasonable  volume of corporate  business.  On weekends,  the
Company attracts customers who are typically in town to attend various community
functions  including but not limited to the "Balloon and Wine  Festival" and the
"Rod Run".  During the summer  months  there are  activities  in the area almost
every weekend.  Occupancy rates during these weekends approached 100% on average
during the first year of operations.

There are 11 hotels and motels,  with 810 rooms, in the community area including
Temecula Valley Inn. The property has excellent  visibility and easy access from
Interstate 15. There are numerous  restaurants  within  walking  distance of the
Hotel.

The Company is beyond the break-even point and can satisfy its cash requirements
in the  foreseeable  future.  The Company  expects  occupancy  rates to steadily
increase  every year due to its  marketing  efforts  and the growth of  Temecula
Valley.


"SAFE HARBOR" STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT:

With the  exception of  historical  information,  the matters  discussed in this
Report are "forward looking statements" as the term is defined in Section 27A of
The Securities Act of 1933, as amended (the "Securities Act") and Section 21E of
The Securities  Exchange Act of 1934, as amended (the "Exchange Act").  While we
Believe that our strategic plan is on target, several important factors, many of
Which are beyond our control, have been identified which could cause the
Successful  implementation  of our  business  plan  to  differ  materially  from
planned,  implied or predicted results. We are a development stage company;  our
profitability  will depend upon the  successful  implementation  of our business
plan or a merger or acquisition by a more  established  company in the industry.
Although   management   believes  that  the  expectations   reflected  in  these
forward-looking  statements are reasonable,  it can give no assurances that such
expectations will prove to have been correct. Important factors that could cause
actual results to differ  materially from the expectations are discussed in this
Report, including, without limitation, in conjunction with those forward-looking
statements contained in this Report.



                                                                   Page 13 of 14

<PAGE>



PART II - OTHER INFORMATION
---------------------------

Item 1 - Legal Proceedings
--------------------------

To the best of the Company's knowledge,  there are no material legal proceedings
pending against the Company or any of its property,  nor was any such proceeding
terminated during the quarter ended September 30, 2000.


Item 2 - Change In Securities
-----------------------------

This item is not applicable.


Item 3 - Defaults Upon Senior Securities
----------------------------------------

This item is not applicable.


Item 4 - Submission Of Matters To A Vote Of Security Holders
------------------------------------------------------------

This item is not applicable.


Item 5 - Other Information
--------------------------

This item is not applicable.


Item 6 - Exhibits And Reports On Form 8-K
-----------------------------------------

This item is not applicable.


                                    SIGNATURE

Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has duly  caused  this  Report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.



Dated:     Temecula, CA
           December 7, 2000                   Supreme Hospitality



                                            By:  /s/ Larry W. Lang
                                                --------------------------------
                                                     Larry W. Lang
                                                     Chief Executive Officer









                                                                   Page 14 of 14