UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

               QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

                  For the quarterly period ended MARCH 31, 2001
                                                 --------------



Commission File Number: 0-18201
                       --------



                             EQUIVEST FINANCE, INC.
                             ----------------------
             (Exact name of Registrant as specified in its charter)

Delaware                                                   59-2346270
--------                                                   ----------
(State or other jurisdiction of                          (I.R.S. Employer
Incorporation or organization)                            Identification  No.)

100 Northfield Street, Greenwich, Connecticut                   06830
---------------------------------------------                   -----
(Address of principal executive offices)                   (Zip code)

Registrant's telephone number, including area code:  (203) 618-0065

Securities registered pursuant to Section 12(b) of the Act:  None

Indicate by check mark whether the Company (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 Company was
required to file such reports) and (2) has been subject to such filing
requirements for the past 90 days. Yes [X] No [ ]


As of March 31, 2001, 28,089,722 shares of common stock of Equivest Finance,
Inc. were outstanding.


Transitional Small Business Disclosure Format. Yes [ ] No [X]



                                       1

<PAGE>


                     EQUIVEST FINANCE, INC. AND SUBSIDIARIES
                                    FORM 10-Q


                          QUARTER ENDED MARCH 31, 2001


                                      INDEX

PART I       FINANCIAL INFORMATION
------

Item 1.      Financial Statements


<TABLE>
<CAPTION>
             Consolidated Condensed Financial Information:
<S>                                                                                                             <C>
                  Consolidated Condensed Balance Sheets - March 31, 2001 (unaudited) and                        3
                        December 31, 2000
                  Unaudited Consolidated Condensed Statements of Income  - Three Months Ended March             4
                        31, 2001 and 2000
                  Unaudited Consolidated Statement of Equity Accounts                                           5
                  Unaudited Consolidated Condensed Statements of Cash Flow - Three Months Ended March 31,       6
                        2001 and 2000
                  Notes to Consolidated Condensed Financial Statements                                          7

Item 2.      Management's Discussion and Analysis of Financial                                                 13
             Condition and Results of Operations

Item 3.      Quantitative and Qualitative Disclosures About Market Risk                                        22


PART II      OTHER INFORMATION
-------

Item 1.      Legal Proceedings                                                                                 22

Item 2.      Changes in Securities and Use of Proceeds                                                         23

Item 3.      Defaults Upon Senior Securities                                                                   23

Item 4.      Submission of Matters to a Vote of Security Holders                                               23

Item 5.      Other Information                                                                                 23

Item 6.      Exhibits and Reports on Form 8-K                                                                  23
</TABLE>


SIGNATURES



                                       2

<PAGE>


                         PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.

                                     EQUIVEST FINANCE, INC. and SUBSIDIARIES
                                       CONSOLIDATED CONDENSED BALANCE SHEETS


<TABLE>
<CAPTION>
                                                               March 31,      December 31,
                                                                 2001            2000
                                                           ---------------   ------------
                                                               Unaudited
ASSETS

<S>                                                          <C>            <C>
Cash and cash equivalents                                    $  3,372,215   $  4,805,366
Receivables, net                                              252,352,285    258,950,064
Inventory                                                      95,332,556     95,577,521
Property and equipment, net                                    21,229,547     21,580,157
Goodwill, net                                                  43,661,573     44,109,482
Other assets                                                   15,171,459     11,951,491
                                                             ------------   ------------
TOTAL ASSETS                                                 $431,119,635   $436,974,081
                                                             ============   ============

LIABILITIES AND STOCKHOLDERS' EQUITY

LIABILITIES

Accounts payable                                             $  8,011,541   $  9,624,115
Accrued expenses and other liabilities                         24,732,743     23,194,002
Income taxes                                                   30,830,804     29,974,986
Notes payable                                                 278,806,961    288,374,503
                                                             ------------   ------------
TOTAL LIABILITIES                                             342,382,049    351,167,606

CONTINGENCIES, COMMITMENTS
  AND LIQUIDITY

STOCKHOLDERS' EQUITY

Cumulative Redeemable Preferred Stock--Series 2
Class A, $3 par value; 15,000 shares authorized,
  10,000 shares outstanding; $10,000,000 liquidation value         30,000         30,000
Common Stock, $.01 par value; 50,000,000
  shares authorized; 28,089,722 shares outstanding                280,897        280,897
Additional paid in capital                                     62,246,553     62,246,553
Retained earnings                                              26,180,136     23,249,025
                                                             ------------   ------------
TOTAL STOCKHOLDERS' EQUITY                                     88,737,586     85,806,475
                                                             ------------   ------------


TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                   $431,119,635   $436,974,081
                                                             ============   ============
</TABLE>



                                       3

     See Accompanying Notes to Consolidated Condensed Financial Statements


<PAGE>



                     EQUIVEST FINANCE, INC. AND SUBSIDIARIES
             CONSOLIDATED CONDENSED STATEMENTS OF INCOME (UNAUDITED)




                                         Three Months Ended March 31,
                                         ----------------------------
                                               2001         2000
                                               ----         ----
REVENUE

    Timeshare interval sales               $14,581,621   $22,404,641
    Interest                                 9,079,698     9,365,057
    Resort operations                        5,002,652     5,011,302
    Other income                               574,405       418,676
                                           -----------   -----------


                                            29,238,376    37,199,676
                                           -----------   -----------

COSTS AND EXPENSES


    Interest                                 5,582,321     6,049,003
    Cost of timeshare intervals sold         3,252,156     5,417,880
    Sales and marketing                      6,476,935    10,415,773
    Resort management                        2,486,776     3,037,887
    Depreciation and amortization            1,073,580     1,153,564
    Provision for doubtful receivables       1,788,961     1,782,756
    General and administrative               3,421,536     4,726,539
                                           -----------   -----------


                                            24,082,265    32,583,402
                                           -----------   -----------


INCOME BEFORE PROVISION FOR INCOME TAXES     5,156,111     4,616,274

PROVISION FOR INCOME TAXES                   2,225,000     1,950,000
                                           -----------   -----------


NET INCOME                                 $ 2,931,111   $ 2,666,274
                                           ===========   ===========



Basic earnings per common share            $      0.10   $      0.09
                                           ===========   ===========


Diluted earnings per common share          $      0.10   $      0.09
                                           ===========   ===========


                                       4

     See Accompanying Notes to Consolidated Condensed Financial Statements


<PAGE>





                     EQUIVEST FINANCE, INC. AND SUBSIDIARIES
             CONSOLIDATED STATEMENTS OF EQUITY ACCOUNTS (UNAUDITED)
                        THREE MONTHS ENDED MARCH 31, 2001








<TABLE>
<CAPTION>
                                                                                Redeemable
                                                   Preferred       Common          Stock          Additional        Retained
                                     Total        Stock-Series     Shares          Amount         Paid in         Earnings
                                                   2 Class A                                      Capital
                                  ------------    ------------   ------------    -----------   --------------   --------------
<S>                                <C>              <C>            <C>             <C>            <C>            <C>
Balances at December 31, 2000      $85,806,475      $   30,000     28,089,722      $ 280,897      $62,246,553    $  23,249,025

Net Income                          2,931,111                                                                       2,931,111
                                  ------------    ------------   ------------    -----------   --------------   --------------

Balances at March 31, 2001        $88,737,586       $  30,000     28,089,722      $ 280,897     $ 62,246,553     $ 26,180,136
                                  ============    ============   ============    ===========   ==============   ==============
</TABLE>





                                       5

     See Accompanying Notes to Consolidated Condensed Financial Statements

<PAGE>


                     EQUIVEST FINANCE, INC. AND SUBSIDIARIES
           CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOW (UNAUDITED)


<TABLE>
<CAPTION>
                                                                             Three Months Ended March 31,
                                                                             ---------------------------
                                                                                 2001           2000
                                                                              ---------       ------
CASH FLOWS USED IN OPERATING ACTIVITIES
<S>                                                                        <C>             <C>
   Net Income                                                              $  2,931,111    $  2,666,274
   Adjustments to reconcile net income to
     net cash used in operating activities:
     Amortization and depreciation                                            1,073,580       1,153,564
     Provision for doubtful receivables                                       1,788,961       1,782,756
     Changes in assets and liabilities
       Other assets                                                          (3,287,245)     (9,979,502)
       Inventory                                                                244,965        (267,059)
       Accounts payable and accrued expenses                                    (73,833)      6,275,056
       Income taxes payable                                                     855,818      (4,670,669)
                                                                           ------------    ------------
                                   NET CASH USED IN OPERATING ACTIVITIES      3,533,357      (3,039,580)

CASH FLOWS PROVIDED BY INVESTING ACTIVITIES
   (Increase)/Decrease in receivables, net                                    4,679,135      (7,177,590)
   Purchase of equipment                                                        (70,034)            -0-
                                                                           ------------    ------------
                               NET CASH PROVIDED BY INVESTING ACTIVITIES      4,609,101      (7,177,590)

CASH FLOWS (USED IN) PROVIDED BY FINANCING ACTIVITIES
   Proceeds from notes payable                                               22,528,441      90,396,127
   Payments on notes payable                                                (32,104,050)    (86,087,695)
   Payments on non-recourse notes payable                                           -0-         (35,922)
                                                                           ------------    ------------
                    NET CASH  (USED IN) PROVIDED BY FINANCING ACTIVITIES     (9,575,609)      4,272,510
                                                                           ------------    ------------
                                             (DECREASE) INCREASE IN CASH     (1,433,151)     (5,944,660)
                                                                           ------------    ------------

Cash and Cash Equivalents at beginning of period                              4,805,366       8,010,888
                                                                           ------------    ------------
                             CASH AND CASH EQUIVALENTS AT END OF  PERIOD   $  3,372,215    $  2,066,228
                                                                           ============    ============
Supplemental Cash Flow Information:
     Interest paid                                                         $  5,653,475    $  6,042,885
                                                                           ============    ============
     Income taxes paid                                                     $  1,486,954    $  2,531,951
                                                                           ============    ============
</TABLE>


                                       6

     See Accompanying Notes to Consolidated Condensed Financial Statements

<PAGE>



                             EQUIVEST FINANCE, INC.


              NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS


A.       Basis of Presentation

         The accompanying consolidated condensed interim financial statements as
of March 31, 2001 and for the three-month period ended March 31, 2001 and 2000
have been prepared in accordance with generally accepted accounting principles
for interim financial information and with the instructions to Form 10-Q and
Rule 10-01 of Regulation S-X. Accordingly, these statements do not include all
of the information and footnotes required by generally accepted accounting
principles for complete financial statements. In the opinion of management, all
adjustments (consisting of normal accruals) considered necessary for fair
presentation have been included. Operating results for the three-month period
ended March 31, 2001 are not necessarily indicative of the results expected for
the year ended December 31, 2001. For further information, please refer to the
consolidated financial statements and footnotes thereto included in Equivest
Finance, Inc.'s (the "Company") Form 10-K for the year ended December 31, 2000.

         Principles of Consolidation

         The accompanying consolidated financial statements include the accounts
of the Company and its subsidiaries, Resort Funding, Inc. and its subsidiary,
BFICP Corporation (collectively, "Resort Funding"), EFI Funding Company, Inc.,
EFI Development Funding, Inc., Equivest Capital Funding, Inc. (inactive), Resort
Marketing Services, Inc., Mirror Lake Development, Inc., Mirror Lake Realty,
Inc., Eastern Resorts Corporation and its subsidiaries, Eastern Resorts Company,
LLC and Long Wharf Marina Restaurant, Inc. (collectively, "Eastern Resorts");
Bluebeard's Castle, Inc., and subsidiaries thereof, Castle Acquisition, Inc.,
Avenue Plaza LLC, Ocean City Coconut Malorie Resort, Inc., St. Augustine Resort
Development Group, Inc., Equivest Washington, Inc., Equivest St. Thomas, Inc.,
Equivest Maryland, Inc., Equivest Florida, Inc., and Equivest Louisiana, Inc.
(all of which were acquired or created in connection with the acquisition by the
Company of six timeshare vacation resorts, one resort development site,
management contracts and consumer notes receivable from Kosmas Group
International, Inc. ("KGI") in March 1999 (the "Kosmas Acquisition"); Peppertree
Resorts Ltd., and its subsidiaries, Peppertree Resort Villas, Inc., Peppertree
Resorts Vacation Club, Inc. (now known as Equivest Vacation & Travel Club,
Inc.), Peppertree Vacation Club, Inc. (now known as Equivest Club, Inc.), and
Peppertree Resorts Management, Inc. (all of which were acquired in connection
with the acquisition by the Company of fifteen timeshare vacation resorts,
management contracts and consumer notes receivable from Peppertree Resorts, Ltd.
("Peppertree Resorts") in November 1999 (the "Peppertree Acquisition"); and
Equivest Texas, Inc, which was created in connection with the acquisition by the
Company of a resort development site on May 3, 2000 (known as Riverside Suites).
All significant intercompany balances and transactions have been eliminated in
consolidation.

B.       Summary of Significant Accounting Policies

         Use of Estimates

         The preparation of these 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
disclosures of contingent assets and liabilities at the date of the financial
statements, and the reported amounts of revenues and costs and expenses during
the reporting period. Actual results could differ from the Company's estimates.

         Inventory and Cost of Timeshare Intervals Sold

         Inventory is stated at the lower of cost or market and consists of
timeshare intervals held for sale and construction in progress of new timeshare


                                       7

<PAGE>

units, including the cost of land for future timeshare units. These costs are
charged to cost of property sold based upon the relative sales values of the
intervals sold. Intervals re-acquired are placed back into inventory at the
lower of their original historical cost basis or market value.

         Property and Equipment


         Property and equipment (including equipment under capital lease) net of
accumulated depreciation, are stated at cost. The Company computes depreciation
using the straight-line method over the estimated useful lives of the assets,
which have been estimated as follows:

          Buildings and improvements                           5-40 years
          Furniture and equipment                              3-7 years


         Earnings Per Share


         Pursuant to SFAS 128, a reconciliation of the numerators and the
denominators of the basic and diluted per-share computation follows:

<TABLE>
<CAPTION>
                                                                     For the Quarter Ended March 31, 2001

                                                               Income               Shares           Per-Share
                                                             (Numerator)          (Denominator)        Amount
                                                             -----------          -------------      ---------
<S>                                                           <C>                    <C>                <C>
    Net Income                                               $2,931,111
    Less: Preferred Stock dividends                            (150,000)
                                                            ------------

    Basic earnings per share:
      Income available to common stockholders                 2,781,111              28,089,722         $.10
                                                                                                        ====

    Effect of dilutive securities:
      Stock options                                                 ---             156,201
                                                             -----------            -----------

    Diluted earnings per share:
      Income available to common stockholders
        plus assumed conversions                             $2,781,111              28,245,923         $.10
                                                             ===========            ===========         ====

                                                                      For the Quarter Ended March 31, 2000

                                                               Income               Shares           Per-Share
                                                             (Numerator)          (Denominator)        Amount
                                                             -----------          -------------      ---------
    Net Income                                                $2,666,274
    Less: Preferred Stock dividends                            (150,000)
                                                            ------------

    Basic earnings per share:
      Income available to common stockholders                 2,516,274              28,089,722         $.09
                                                                                                        ====

    Effect of dilutive securities:
      Warrants                                                       ---                 16,123
      Stock options                                                  ---                281,449
                                                             -----------            -----------

    Diluted earnings per share:
      Income available to common stockholders
        plus assumed conversions                             $2,516,274              28,387,294         $.09
                                                             ===========            ===========         ====
</TABLE>


                                       8

<PAGE>


             Redeemable Preferred Stock

         At March 31, 2001, the cumulative undeclared and unpaid dividends
amount to $1,650,000.

         SFAS No. 133 - Accounting for Derivative Instruments and Hedging
Activities

         In June 1998, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standard No. 133, "Accounting for Derivative Instruments
and Hedging Activities" ("SFAS No. 133"). SFAS No. 133, as amended, is effective
for fiscal years beginning after June 15, 2000 and will be adopted for the
period beginning January 1, 2001. SFAS No. 133 requires that all derivative
instruments be recorded on the balance sheet at their fair value. Changes in the
fair value of the derivatives are recorded each period in current earnings or
other comprehensive income depending on whether a derivative is designated as
part of a hedge transaction, and if it is, the type of hedge transaction. The
Company currently has no derivative instruments.

         Reclassifications

         Certain amounts for the three months ended March 31, 2000 have been
reclassified to be consistent with the year 2001 classifications.


C.       Contingencies, Commitments and Liquidity

         CSFB Credit Facility. In November 1997, the Company entered into a
credit facility with Credit Suisse First Boston Mortgage Capital LLC ("CSFB"),
which provided up to $75.0 million to finance purchased receivables and to make
hypothecation loans, and $30.0 million to fund acquisition and development loans
(the "CSFB A&D Line"). The Company paid the CSFB consumer receivables debt in
full in February 2000. As of March 31, 2001, $12.5 million was outstanding under
the CSFB A&D Line, whose maturity has been extended until February 16, 2002 in
accordance with the terms of an agreement with CSFB (the "CSFB Extension"). The
CSFB Extension also extends until February 2002 the maturity date of certain
mortgage loans made by CSFB on the Company's properties in New Orleans,
Louisiana, St. Thomas, US Virgin Islands, and Ocean City, Maryland with an
aggregate unpaid principal amount of approximately $27.8 million. These loans
were originally made by CSFB to these companies, prior to the Kosmas
Acquisition. All of the mortgage loans to the Company and the third party
acquisition and development loans are repaid through release fee payments each
time a vacation ownership interval ("VOI") in any such property is sold.

         DG Credit Facility. In January 2000, the Company, through its
subsidiary EFI Funding Company, Inc., entered into a $150 million consumer loan
credit facility with DG Bank Deutche Genossenschaftsbank AG ("DG Bank") as Agent
for Autobahan Funding Company LLC ("DG Credit Facility"). The term of this
facility is five years, and the interest rate is based on lender's commercial
paper rate plus 1.35%. The facility currently acts as the main facility for
funding all subsidiary consumer loans and third party loans. Under the terms of
the DG Credit Facility, the Company is responsible for all loan servicing,
administration and processing. The Company in cooperation with DG Bank is
seeking to increase both the advance rate and the size of the total credit
allowable under the DG Credit Facility. There is no guarantee that the Company
will be successful in achieving these increases. If the Company does not obtain
an increase in the size of the DG Credit Facility, the Company may need to
develop alternative credit facilities with other lending institutions later in
2001. As of March 31, 2001, approximately $138.0 million was outstanding under
the DG Credit Facility, although aggregate portfolio growth after prepayments
tends to be relatively slow, particularly in the first and second quarters. The
Company believes that it has an excellent relationship with DG Bank, and that
the DG Credit Facility will be expanded to accommodate future portfolio growth.


                                      9

<PAGE>

However, there is no assurance that the current DG Credit Facility will be
expanded, or that changes will occur when needed by the Company.

         Bank of America Loan. In November 1999, the Company entered into a
$20.7 million bridge loan with Bank of America, N.A. ("B of A Bridge Loan") in
connection with the Peppertree Acquisition. This B of A Bridge Loan had an
outstanding balance of $15.4 million as of March 31, 2001. The Company and Bank
of America have reached an agreement extending this loan for an additional two
years (the "B of A Extension Agreement"), subject to certain conditions and debt
covenants. These conditions include periodic monthly amortization payments
similar to what the Company has been paying Bank of America since August 2000,
and $3.5 million in principal pay downs ($1 million in November 2001, and $2.5
million in January 2002, out of the proceeds of sales of land and other assets
the Company plans to sell). The Company currently has contracts of sale in place
covering more than the necessary amount of principal pay downs, although there
is no assurance that such contracts will close as expected.

         1999 Finova Loan Agreement. The Company has $50 million in revolving
credit facilities with Finova Capital Corporation ("Finova"), comprised of a $20
million revolving facility to fund third party A&D and other loans (the "Finova
Third Party Line"), and a $30 million revolving facility to fund construction at
the Company's own resorts (the "Finova Internal Line") The outstanding balance
as of March 31, 2001, was $6.8 million on the Finova Internal Line, and $3.3
million on the Finova Third Party Line. Finova has filed for bankruptcy
protection and may not be able to fund commitments of this type. Furthermore,
any new loan commitments under these revolving lines could be subject to
approval of the U.S. Bankruptcy Court overseeing the Finova bankruptcy. The
Company believes that Finova is in default of its obligations under both
revolving facilities.

         Other Indebtedness. The Company has some additional facilities that
were either undertaken or assumed in conjunction with its development
activities. These facilities include some of the traditional timeshare industry
lenders as well as smaller regional or community banks. The aggregate balances
of these loans as of March 31, 2001, were approximately $37.4 million. While
there is approximately $18 million of availability under these credit
facilities, the Company plans on using its other facilities, which have more
favorable terms, and replacing outstanding balances with lower cost financing
whenever possible under the terms of such indebtedness. The Company also has
approximately $8.3 million in additional debt relating to Peppertree Resort
properties. The majority of these other loans mature after the year 2001, and
are repaid out of release fees on sales of VOIs.

         Beginning in September 1996, the trustee reached settlements of the
claims of certain lenders against the Bennett Estate (as defined more fully
under "Bankruptcy of Related Entities" in the company's 10-K filed April 2,
2001) relating to claims to certain lease collateral of the Bennett Estate.
These settlements required the settling banks to make new non-callable term
loans to Resort Funding at concessionary interest rates of 0.5% to 4.0% (the
"Settlement Loans"). Resort Funding is also obligated to pay the Bennett Estate
an annual arrangement fee of 3% of the unpaid principal balance of the
Settlement Loans. The Settlement Loans have a weighted average interest rate of
2.1% as of March 31, 2001. The Settlement Loans are also collateralized by note
receivables of the Company as to 100% of the face value of such notes. As of
March 31, 2001, Resort Funding's total outstanding balance on the Settlement
Loans was approximately $17.3 million and the weighted average remaining
maturity was 26 months. In addition to these Settlement Loans, Resort Funding
also has an additional $9.3 million in additional debts to other community
banks. Beginning in 2001, the Company will have to begin refinancing the
settlement loans. Any replacement loans will carry higher interest rates, and
will most likely require some level of additional collateralization.


         Liquidity. At March 31, 2001, the Company's debt to equity ratio was
3.1:1 compared to 3.8:1 at December 31, 1999. The Company is seeking to reduce
its leverage further through a program of selected sale of land and other
assets, as well as normal debt repayment through timeshare release fees.


                                       10

<PAGE>

Aggregate notes payable decreased by $9.6 million due to net debt paydowns
during the first quarter of 2001.

         The Company has high overall levels of debt, and substantially all of
the Company's assets have been pledged as collateral on its loans. The level of
indebtedness could have important consequences to investors including:

     o    Increasing the Company's vulnerability to general adverse economic or
          industry conditions;

     o    Limiting its ability to obtain additional financing to fund future
          lending, resort acquisition and development and general corporate
          requirements; and

     o    Requiring it to dedicate a substantial portion of its cash flow from
          operations to the payment of indebtedness, thereby reducing operating
          flexibility and opportunities for growth.

         The Company requires continuous financing to conduct its finance and
resort acquisition and development businesses. The Company needs sources of
liquidity to make new loans to consumers for the purchase of timeshare VOIs, to
replace existing facilities that are maturing, to acquire land and develop new
timeshare resorts, and to lend to third party developers. To meet its capital
needs, the Company plans to expand its equity base through retained earnings and
equity investments whenever possible; and to increase it's borrowing
availability under warehouse lines like the DG Credit Facility. In addition, the
Company is exploring the possibility of entering into additional financing
transactions in which it either sells or borrows against the collateral in its
loan portfolio, or issuing other debt securities in the capital markets as
operations and market conditions permit.



                                       11

<PAGE>



D.       Segment Information

         Financial information with respect to the financing and resort
development segments in which the Company operates follows for the periods
indicated:

<TABLE>
<CAPTION>
                                                                                   Resort
                                                             Financing            Development             Total

Three months ended March 31, 2001:

<S>                                                         <C>                 <C>                  <C>
    Revenues from external customers                        $ 9,225,630         $ 20,012,746         $ 29,238,376

    Intersegment revenues                                     1,053,339                   --            1,053,339

    Segment Profit                                            2,726,307            3,127,942            5,854,249

   Reconciliation of total segment profit
   to consolidated income before income
   taxes:

   Total segment profit                                                                                 5,854,249

    Unallocated corporate expenses                                                                      (698,138)

   Consolidated income before provision for
   income taxes                                                                                         5,156,111


Three months ended March 31, 2000:


    Revenues from external customers                       $  9,686,577         $ 27,513,099         $ 37,199,676

    Intersegment revenues                                       280,461                   --              280,461

    Segment Profit                                            2,326,168            3,016,112            5,342,280

   Reconciliation of total segment profit
   to consolidated income before income
   taxes:

   Total segment profit                                                                                 5,342,280

    Unallocated corporate expenses                                                                      (726,006)

   Consolidated income before provision for
   income taxes                                                                                         4,616,274
</TABLE>


                                       12

<PAGE>



Item 2. Management's Discussion and Analysis of Financial Condition and Results
        of Operations.

         Forward-looking Statements

         Certain matters discussed or incorporated herein by reference contain
forward-looking statements. These statements may be identified by the use of
words or phrases such as "believe," "expect," "anticipate," "should," "planned,"
"estimated," and "potential." Forward-looking statements are based on the
Company's current expectations. The Private Securities Litigation Reform Act of
1995 provides a "safe harbor" for such forward-looking statements. In order to
comply with the terms of the safe harbor, the Company notes that a variety of
factors could cause actual results and experience to differ materially from the
anticipated results or other expectations expressed in such forward-looking
statements. These factors include, among others, general economic and business
conditions, industry trends, changes in business strategy or development plans,
availability and quality of management, adverse weather conditions or other
natural causes affecting any of the Company's sales centers, costs of marketing
programs, including no-show rates among tour guests and price increases by third
party tour vendors, a downturn in the real estate cycle or other factors which
result in lower sales of vacation ownership interests, possible financial
difficulties of one or more of the developers with whom the Company does
business (such as the risk of carrying non-performing assets or losses if
defaulted loans prove to have insufficient collateral backing), fluctuations in
interest rates, increases in fees or interest costs associated with the
Company's indebtedness, availability of adequate liquidity, prepayments by
consumers of indebtedness, prepayments by developers, inability of developers to
honor replacement obligations for defaulted consumer notes, and competition from
organizations with greater financial resources.


                                       13

<PAGE>


                        THREE MONTHS ENDED MARCH 31, 2001

                   March 31, 2001 Compared to March 31, 2000


         During the first three months of 2001, the Company's results included
revenue and expense from the Company's subsidiary in Texas, Riverside Suites,
which was acquired in the second quarter of 2000. Other than the addition of the
Riverside Suites project, whose results were not material, results of the first
quarter for both 2001 and 2000 include the same locations.

Net Income

         Income before provision for income taxes increased 12% to $5.2 million
for the three months ended March 31, 2001, as compared to $4.6 million for the
same period in 2000. Net income increased 10% to $2.9 million for the first
quarter of 2001 from $2.7 million for the same period in 2000. Diluted earnings
per share increased 11% to $0.10 for the first quarter of 2001 from $0.09 for
same time period in 2000. The increase in net income is primarily attributable
to increased profit margins in the timeshare operations at the former Eastern
Resorts and cost reduction measures implemented at Peppertree Resorts, including
the elimination of marginal sales locations and unprofitable sales and marketing
efforts, as well as significant personnel cost reductions at Peppertree Resorts
and other acquired locations. These increases were partially offset by a
reduction in VOI sales and profit margins in the St. Thomas locations.

         The Company's pretax income as a percent of revenues increased to 17.6%
for the first quarter of 2001 from 12.4% for the first quarter of 2000. During
the same period, total expenses decreased 26% from $32.6 million for the first
quarter of 2000 to $24.1 million for the same time period in 2001. The decline
in expenses is primarily due to the decrease in variable costs (cost of
timeshares sold and sales and marketing costs) associated with the reduction in
VOI sales.  In addition, the restructuring at the Peppertree Resorts, the
reduction in general and administrative overhead, the reduction in resort
management expense and the increase in net interest margin also contributed to
the reduction in overall expenses and the increase in pretax income.

         Total revenue decreased 21% to $29.2 million for the three months ended
March 31, 2001 as compared to $37.2 million for the same time period in 2000.
The decline in revenue is due almost entirely to reduced VOI sales revenue,
which fell $7.8 million in the first quarter of 2001 compared to the comparable
period in 2000. This reduction in sales revenue in the Company's Peppertree
subsidiary is due to the closure of five former sales centers and two
telemarketing centers during 2000. The aggregate reduction in sales revenues
also reflected reduced tour volumes at non-Peppertree Resorts' sales centers,
partly the result of the Company eliminating higher cost tour sources, and
partly the result of slower overall economic activity. Of the total reduction in
VOI sales, $5.4 million came from former Peppertree locations and $2.4 million
came from non-Peppertree Resorts sales locations. Most of the decline in
non-Peppertree Resorts VOI sales revenue came from reduced sales volumes in St.
Thomas.



                                       14

<PAGE>


Interest Income

         Interest income includes interest earned from the Company's consumer
receivable portfolio and interest earned from the Company's third party loan
portfolio. Interest income decreased 3% to $9.1 million for the first quarter of
2001 from $9.4 million for the first quarter of 2000. The slight decrease in
interest income is primarily due to lower average outstanding balances on third
party purchased receivables and acquisition and development loans.

         Interest income related to the consumer loan portfolio increased to 94%
of total interest income for the first quarter of 2001, compared to 91% of
interest income for the same period in 2000. The increase is primarily due to
higher average outstanding balances of the owned consumer portfolio.

         Interest on A&D Loans decreased 45% to $0.4 million for the three
months-ended March 31, 2001 from $0.8 million for the same period in 2000,
mainly due to lower average outstanding balances. Third party A&D Loan
originations declined 61% from $3.7 million for the first quarter of 2000 to
$1.5 million for the first quarter of 2001. The decline in A&D loan originations
is attributable to the continued shift in the Company's consumer loan growth
strategy from generating receivables through new A&D lending to relying on
captive originations from the sale of VOIs in the Company's own resorts. All of
the Company's portfolio growth in the aggregate now comes from
internally-generated receivables.

VOI Sales

         VOI revenues decreased 35% to $14.6 million for the first quarter of
2001, from $22.4 million for the same period in 2000. Vacation ownership revenue
decreased to 49.8% of total revenue for the first quarter of 2001 as compared to
60.2% for the same period in 2000 due to the decline in VOI sales revenues.
Approximately $5.4 million of the aggregate reduction in sales revenue came from
former Peppertree Resorts and $2.4 million came from non-Peppertree Resorts
sales locations. Most of the $2.4 million decrease in non-Peppertree Resorts VOI
sales revenue was a result of reduced sales volumes in St. Thomas. The $5.4
million reduction in sales revenue in the Company's Peppertree subsidiary is due
to the closure of five former sales centers and two telemarketing centers during
2000. The aggregate reduction in sales revenues also reflected reduced tour
volumes at non-Peppertree Resorts sales centers, partly the result of the
Company eliminating higher cost tour sources, and partly the result of slower
overall economic activity.

         For the quarter ending March 31, 2001, the Company sold 839 fixed-week
VOIs and 254 points packages, at a combined average sales price of approximately
$12,849. VOI sales revenues for first quarter of 2001, reflected a 48% decrease
in the number of VOIs sold, and a 22% increase in the average sales price of a
VOI compared to the same period in 2000. The Company now owns or manages 29
timeshare resort locations with a completed inventory of approximately 26,734
VOIs. The Company operates twelve sales centers, five of which sell points in
the Company's "Vacation Club", as described herein.

         The following tables sets forth the number of timeshare intervals sold
and the average sales price per timeshare interval:


                                              For the Quarter-ended
                                       March 31,                   March 31,
                                         2001                        2000
                                         ----                        ----

Timeshare intervals and
points packages sold                    1,093                        2,110
Average Sales Price                   $12,849                      $10,550
Number of VOIs in inventory
at period end                          26,734                       25,577

         Five of the Company's sales centers sell points in the Company's
Vacation Club rather than traditional timeshare weeks. Pricing policies for
vacation points involve a greater range of variation due to different sizes of
points packages than prices for fixed or floating week VOIs. Sales of biennial
VOIs are counted as a sale of an interval, though the customer pays a lower

                                       15


<PAGE>

absolute price for his or her alternate year usage rights. Inclusion of biennial
sales tends to lower the average sales price per interval, though the available
number of VOIs in inventory would be much greater if used as biennials rather
than as whole weeks or their equivalent in points. Based on all the foregoing
factors, the stated average sales price per timeshare interval may not reflect
fully the actual revenues received for each equivalent to a whole week of resort
usage.

Resort Operations

         Resort operations revenue remained constant at $5.0 million for the
first quarter of 2001 and 2000. However, resort management expenses decreased
$0.5 million to $2.5 million in the first quarter of 2001 compared with $3.0
million in the prior year. Resort management expense as a percentage of resort
operation revenue dropped to 49.7% for the first quarter of 2001 as compared
with 60.6% for same period in 2000. The decline in resort management expense
generally reflects cost reduction measures.

Other Income

         Other income increased 37% to $0.6 million for the first quarter of
2001 as compared to $0.4 million for the same period in 2000. The increase in
other income is primarily due to increased processing fee income.

Provision For Doubtful Receivables

         The provision for doubtful receivables remained constant at $1.8
million for the first quarter of 2001 and 2000. The increase in the provision
for doubtful accounts as a percentage of timeshare sales reflects an increase in
the Company's rate of provisioning for doubtful receivables from 8.0% of VOI
sales during the first three months of 2000 to 12.3% of VOI sales for the same
period in 2001. Increases in the rate of provisioning for doubtful receivables
are driven by the Company's Target Reserve Methodology ("TRM"), which requires
additional provisions to reflect both portfolio growth and increases in
receivable aging. The increased percentage rate of reserving for doubtful
receivables was necessary to maintain an adequate level of reserves during a
time period in which sales declined by 35% during the first quarter of 2001 as
compared to the first quarter in 2000. The Company assumes all default risk for
receivables relating to purchases of VOIs in the Company's own resorts. However,
the Company has a right to "chargeback" defaulted consumer receivables relating
to consumer purchases in third party resorts to the third party developers.
Thus, as the proportion of the Company's total consumer loan portfolio that
relates to the Company's own resorts grows, the total level of provisioning for
doubtful receivables relating to the Company's own sales becomes more
significant.

         As part of its TRM, the Company has established a Minimum Target
Reserve ("MTR") for its owned consumer loans based on the principal aging of the
consumer loans. The following list sets forth the target reserve level based on
the aging of any given owned consumer note receivable:

                  o    Current - 29 days past due     5%
                  o    30 - 59 days past due         10%
                  o    60 - 89 days past due         50%
                  o    90+ days past due             95%

         The targeted reserve level is based on the outstanding principal
balance of the Consumer loan less an inventory recapture amount. When the
Company believes that collectibility of a receivable is unlikely, that amount is
charged against the allowance for doubtful receivables.


                                       16

<PAGE>

         At March 31, 2001, the Company had total reserves (including over
collateralization on the Hypothecation Loans) for its loan portfolio equal to
$34.5 million or 13.0% of total loans. Included in this amount were total
reserves and over collateralization of $23.1 million on third party consumer
receivables or approximately 20.6% of the outstanding consumer receivables
portfolio attributable to third party resorts. This represented a reserve
coverage ratio of 15.5 times the $1.5 million of such receivables that were 60
or more days past due at March 31, 2001.

         At March 31, 2001 the Company also maintained an aggregate allowance
for doubtful receivables of $11.3 million, or 7.7% of the outstanding consumer
receivable portfolio from owned resorts. This represented a reserve coverage
ratio of 1.8 times the approximate $6.4 million in consumer receivables from
owned resorts that were 60 days or more past due as of that date. The $11.3
aggregate allowance for doubtful receivables represented an increase of 13%
compared with $10.0 million at March 31, 2000.

         The following table sets forth the performance of the consumer
receivable portfolio at March 31, 2001:

                                       Consumer Receivable Loan
                                              Portfolio
                                           (In Thousands)

<TABLE>
<CAPTION>
                                          Current      30-59 days      60-89 days        90+ days           Total

<S>                                      <C>               <C>             <C>             <C>           <C>
Subsidiary Consumer Loans                $136,264          $4,056          $2,172          $4,283        $146,775
                                            92.8%            2.8%            1.5%            2.9%          100.0%

Third Party Loans  (1)                   $108,452          $2,565            $824            $670        $112,511
                                            96.4%            2.3%            0.7%            0.6%          100.0%

Total                                    $244,716          $6,621          $2,996          $4,953        $259,286
                                            94.4%            2.5%            1.2%            1.9%          100.0%
</TABLE>

(1)  Includes the consumer receivables that collateralize the Hypothecation
     Loans.

         At March 31, 2001, 94.4% of the aggregate consumer receivable portfolio
was current, and there were 890 notes with a principal balance of $4.9 million
that were over 90 days past due. Of this amount, $4.2 million relates to the
consumer receivables in the Company's resorts. During 2001, the company wrote
off 375 consumer notes with an outstanding principal balance of $2.9 million,
leading to a charge after inventory recovery of $2.2 million. This total level
of charges to the allowance for doubtful receivables represents an increase of
18% over the first quarter of 2000. Total reserves and overcollateralization of
approximately $34.5 million at March 31, 2001, compared with $7.9 million in
total consumer receivables that were 60 days or more past due represented an
overall reserve coverage ratio of 4.3 times the volume of 60 day past due notes.


                                       17

<PAGE>


         The following table sets forth the current and historic composition of
reserves and over collateralization, reserves as a proportion of total loans,
and the levels of past due loans and chargebacks:

<TABLE>
<CAPTION>
                                                                Loan Reserves Coverage
                                                                (Dollars in thousands)

                                                          As of December 31,                             March 31,
                                             --------------------------------------------------
                                               1997          1998           1999           2000           2001
                                               ----          ----           ----           ----           ----

<S>                                          <C>           <C>            <C>              <C>            <C>
A&D Loans past due                           $9,485        $3,435         $3,821           $376           $369
Consumer Financing past due                   1,458         1,790          2,708          4,600          4,953
                                              -----         -----         ------         ------         ------
Total past due loans                        $10,943        $5,225         $6,529         $4,976         $5,322

Total loans                                $136,530      $160,952       $260,090        275,082        264,685

Total past due loans as % of                   8.0%          3.2%           2.5%           1.8%           2.0%
    Total loans

General reserves                             $2,442        $3,835        $10,073        $11,763        $11,346
Specific reserves                            17,320        18,392         18,507         17,406         16,956
Overcollateralization                         1,006         3,588          4,308          5,981          6,168
                                              -----        ------         ------        -------        -------
Total reserves and
   Overcollateralization (1)                $20,768       $25,815        $32,888        $35,150        $34,470
Total reserves and
   overcollateralization as % of
   total loans                                15.2%         16.0%          12.6%          12.8%          13.0%

Chargebacks                                   6,376         5,875          5,542          5,796          1,589

Chargebacks as % of
   Consumer Financing (2)                      6.6%          5.5%           5.1%           5.4%           1.5%
</TABLE>

------------------------
(1)  Specific reserves and the overcollateralized contracts relate to specific
     developers, and any application of these reserves or overcollateralized
     contracts to defaulted loans would be done on a developer by developer
     basis.
(2)  Chargeback percentage is based on Consumer Financing, because only these
     loans can be charged back.


                                       18

<PAGE>



         The following two tables show current and historic levels of 90 day
past due loans and changes in the Company's allowance for doubtful accounts:

<TABLE>
<CAPTION>
                                                           90 Day Past Due Loans
                                                          (Dollars in thousands)
                                                           As of December 31, 2000
                                        ---------------------------------------------------------   March 31,
                                             1997          1998          1999          2000          2001
                                             ----          ----          ----          ----          ----
<S>                                         <C>          <C>            <C>          <C>           <C>
  Total loan portfolio balance              $136,530     $160,952       $260,090     $275,082      $264,685
  Principal amount of past due loans:
  A&D Loans                                   $9,485       $3,435         $3,821         $376          $369
  Purchased Receivables                        1,458        1,253          1,364          800           670
  Hypothecation Loans                             --           --             --           --            --
  Consumer Loans                                  --          537          1,344        3,800         4,283
  Other Loans                                     --           --             --           --            --
                                               -----       ------         ------       ------        ------
  Total principal amount of past due
     loans                                   $10,943       $5,225         $6,529       $4,976        $5,322
  Past due loans as a percentage of
     total principal amount of loans
     outstanding                                 8.0%        3.2%           2.5%         1.8%          2.0%


                                                                 Consolidated
                                                 Changes in Allowance for Doubtful Accounts
                                                             (Dollars in thousands)
                                                         Year-ended December 31, 2000
                                             ----------------------------------------------       March 31,
                                               1997          1998          1999        2000          2001
                                               ----          ----          ----        ----          ----
Allowance for doubtful accounts,
   beginning of year                        $1,979        $2,442        $3,835      $10,073       $11,763
Allowance related to acquisitions
                                                --           793         6,639          501            --
Provision for loan losses                      925           791         2,192        9,078         1,789
Charges to allowance for doubtful
   accounts                                  (601)         (424)       (2,593)      (7,889)       (2,206)
Charges applied against specific
   developer   holdbacks (1)
                                               139           233            --           --            --
                                            ------        ------       -------      -------       -------
Allowance for doubtful accounts, end
   of year                                  $2,442        $3,835       $10,073      $11,763       $11,346
</TABLE>
----------------
 (1) In accordance with the terms of certain agreements with developers, the
     Company charges certain bad debts directly against developer holdbacks,
     rather than against the general allowance for doubtful accounts.



                                       19

<PAGE>



Interest Expense

         Interest expense, net of capitalized amounts, decreased 8% to $5.6
million for the first three months of 2001 as compared to $6.0 million for the
same period in 2000. The decrease in interest expense is a result of several
loan facilities that were repaid during the first quarter of 2001, as well as
significant reduction in interest rates. The average outstanding balance
decreased approximately $13 million, while the weighted average interest rate on
outstanding debt decreased from 8.5% for the first quarter of 2000 to 7.8% for
the first quarter of 2001.

         The Company has not traditionally hedged against its interest rate risk
due to the wide spread on its receivables and the speed with which new
originations occur. However, under the new $150 million DG Credit Facility, the
facility requires the Company to hedge within the facility once the interest
rate spread has been reduced to approximately 600 basis points. This is
currently the largest financing facility that the Company maintains. The
significant reductions in market interest rates experienced in late 2000 and
continuing into 2001 result in lower interest costs on virtually all the
Company's debt while its interest receivable rates are largely fixed.

Cost Of Timeshare Intervals Sold

         The cost of timeshare intervals sold for the first quarter of 2001
decreased to $3.3 million or 22.3% of VOI revenue, compared to $5.4 million for
the first quarter of 2000, or 24.2% of VOI revenue. The decline in dollar volume
is a result of the reduced volume of VOIs sold during the first quarter of 2001.
The decline in the cost as a percentage of VOI revenue is due to an increase in
the average sales price.

Depreciation And Amortization

         Depreciation and amortization decreased 7% to $1.1 million for the
first quarter of 2001 from $1.2 million for the same period in 2000. The
decrease is primarily due to $0.2 million reduction associated with debt issue.

         Goodwill amortization increased 18% to $0.4 million for the first
quarter of 2001 from $0.3 million for the same period in 2000. Goodwill
associated with the Peppertree Acquisition is approximately $18.0 million and is
being amortized over 20 years, while goodwill associated with the acquisition of
Eastern Resorts is approximately $25.7 million and is being amortized over 40
years.

         Depreciation of the properties increased 17% to $0.3 million for the
first quarter of 2001 from $0.2 million for the same period in 2000. The
increase in depreciation is a result of a larger base of depreciable assets.

Sales And Marketing

         Sales and marketing expense decreased 38% to $6.5 million for the first
quarter of 2001 from $10.4 million for the same period in 2000. The decrease in
total sales and marketing dollar expense is due to the decline in VOIs sold
during the quarter and to the reduction of sales and marketing expenses at
Peppertree.

         Sales and marketing costs in the first quarter fell to 44.4% of VOI
sales revenues, down from 46.5% in the first quarter of 2000, and 47.2% for the
full year 2000. Sales and marketing costs as a percentage of VOI sales revenue
in the former Peppertree resorts fell to 40.7% in the first quarter of 2001,
compared with 50.9% in the first quarter of 2000 and 51.2% for the full year
2000.



                                       20

<PAGE>




Resort Management

         Resort management expense for the first quarter of 2001 totaled $2.5
million or 49.7% of resort operation revenue as compared $3.0 million or 60.6%
of resort operation revenue for the comparable period in 2000. The decline in
resort management expenses as a percentage of resort operation revenue is
primarily due to personnel cost reductions.

General And Administrative

         General and administrative expense decreased 28% to $3.4 million for
the first quarter of 2001 from $4.7 million for the same period in 2000. General
and administrative expense as a percentage of total revenue decreased to 11.7%
of total revenue for first quarter of 2001, compared with 12.7% of total revenue
for the first quarter of 2001. The decrease in general and administrative
expense as a percentage of total revenue principally reflects decreases in
personnel costs at Peppertree and other acquired locations.

Provision For Income Taxes

         The provision for income taxes for the first quarter of 2001 increased
14% to $2.2 million from $1.9 million for the same period in 2000. The increase
is attributable to the increase in pretax income during 2001 as compared to the
same period in 2000. The provision for income taxes represents approximately 43%
and 42% of pretax income for 2001 and 2000, respectively.

Inflation

         Inflation has not had a material impact on the Company's revenues,
operating income and net income during any of the Company's three most recent
years. However, to the extent inflationary pressures affect short-term interest
rates, a significant portion of the Company's debt service costs may be
affected, as may be the interest rates the Company charges to its customers
(both customers and developers).



                                       21

<PAGE>





Item 3. Quantitative and Qualitative Disclosures About Market Risk

Information required by Item 3 is incorporated herein by reference to
Management's Discussion and Analysis of Financial Condition and Result of
Operations in Item 2 above.



PART II - OTHER INFORMATION


Item 1. Legal Proceedings.

         The Company is currently subject to litigation and claims arising from
employment, tort, contract, alleged negligence and construction matters, among
others, all arising in the ordinary course of its business.
Management does not expect any of these lawsuits or claims, even if adversely
decided, to have a material adverse effect on the Company or its business. The
Company is, however, required to disclose any material proceeding to which any
director or officer has a material interest adverse to the Company, and any
material bankruptcy, receivership or similar proceeding with respect to the
Company. The Company is also required to disclose any proceeding that involves
primarily a claim for damages if the amount involved, exclusive of interests and
costs, exceeds ten percent (10%) of the current assets of the Company on a
consolidated basis. Except as set forth herein, there have not been any new
developments with respect to material proceedings to which any director or
officer has a material adverse interest in to the Company or any material
bankruptcy, receivership, or similar proceedings with respect to the Company,
except as previously disclosed inclusive of the Company's most recent 10-K
filing for year ending December 31, 2000.

         For additional information regarding these legal proceedings and other
litigation involving the Company, its subsidiaries and affiliates, reference is
made to the Company's Form 10-KSB for the year-ending December 31, 1999, the
Company's Form 10-Q filed May 15, 2000, for the quarterly period ending March
31, 2000, the Company's 10-Q filed August 15, 2000, for the quarterly period
ending June 30, 2000, the Company's 10-Q filed November 14, 2000, for the
quarterly period ending September 30, 2000, and the Company's 10-K filed April
2, 2001, for the year ending December 31, 2000, which are incorporated herein by
reference.

         The Company has filed a complaint in the Supreme Court of New York, in
and for the County of Onondaga, against C. Wayne Kinser ("Kinser"), a director
and former principal owner of Peppertree, and Pioneer Hotel Corporation, the
sole general partner of Great Smokies Hotel Associates, L.P. The complaint is a
result of the breach, by Kinser and the additional defendants, of the November
1999 Agreement and Plan of Reorganization pursuant to which the Company
purchased various Peppertree entities. The complaint sets forth multiple causes
of action, including a default under a promissory note held by a wholly owned
subsidiary of the Company, and guaranteed by Kinser. The complaint further
alleges that Kinser defaulted upon his obligation to make payment of taxes due
and owing by various Peppertree entities and incurred prior to their acquisition
by the Company, and that Kinser breached his fiduciary duty to the Company, as a
result of his improper inducement of the Company to make a tax payment at a time
when he served as a Director of the Company. The Company's action seeks recovery
of more than $3 million from Mr. Kinser. This complaint has been amended to add
an additional count, asserting that defendant Kinser has further breached his
fiduciary duty to the Company by refusing to honor in good faith long standing
business relationships, thereby tortuously interfering with the business of the
Company and its subsidiaries.



                                       22

<PAGE>



Item 2. Changes in Securities.


         None.


Item 3. Defaults Upon Senior Securities.


         None.


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

         None.

Item 5. Other Information.

         None.

Item 6. (a) Exhibits.

         The following exhibits are filed herewith:

     10.1 Third Amendment to Credit Agreement dated as of March 30, 2001, to
          that certain Credit Agreement dated as of November 17, 1999 (as
          amended by the First Amendment to Credit Agreement, dated as of June
          30, 2000, and the Second Amendment and Waiver to Credit Agreement
          dated as of November 17, 2000, as extended by the Letter Agreement,
          dated February 17, 2001, and the Letter Agreement, dated March 17,
          2001, the "Credit Agreement"), among Equivest Finance, Inc. (the
          "Borrower"), Peppertree Acquisition Corp. ("Newco"), Peppertree
          Acquisition Corp. II ("Newco II") and Bank of America, N.A. (the
          "Lender").

         (b) Reports on Form 8-K:

         The Company filed the following reports on Form 8-K during the quarter
covered by this report:

              None

SIGNATURES


         Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has caused this Report to be signed on its
behalf by the undersigned, there unto duly authorized.


EQUIVEST FINANCE, INC.



BY: /s/ Gerald L. Klaben, Jr.
-------------------------------------
Gerald L. Klaben, Jr.
Senior Vice President and Chief Financial Officer

Dated:  May 15, 2001