<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
---------
FORM 10-Q
---------
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934.
For the quarterly period ended: March 31, 1999
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934.
For the transition period from ________ to ________
Commission file number: 0-24531
REALTY INFORMATION GROUP, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 52-2091509
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification Number)
7475 WISCONSIN AVENUE
BETHESDA, MD 20814
(301) 215-8300
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [ X ] - No [ ]
As of April 30, 1999, there were 9,785,729 shares outstanding of the
Registrant's Common Stock, par value $.01.
<PAGE> 2
REALTY INFORMATION GROUP, INC.
TABLE OF CONTENTS
PART I - FINANCIAL INFORMATION
Item 1 - Financial Statements
Condensed Consolidated Statements of Operations..................3
Condensed Consolidated Balance Sheets............................4
Condensed Consolidated Statements of Cash Flows..................5
Notes to Condensed Consolidated Financial Statements.............6
Item 2 - Management's Discussion and Analysis of
Financial Condition and Results of Operations....................9
PART II - OTHER INFORMATION
Item 1 - Legal Proceedings...............................................14
Item 2 - Changes 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
Signatures...............................................................15
2
<PAGE> 3
PART 1 FINANCIAL INFORMATION
ITEM 1 FINANCIAL STATEMENTS
Realty Information Group, Inc.
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
(unaudited)
<TABLE>
<CAPTION>
For the Three Months
Ended March 31,
--------------------
1999 1998
--------------------
<S> <C> <C>
Revenues $ 6,127 $ 2,839
Cost of revenues 2,594 904
--------------------
Gross margin 3,533 1,935
Operating expenses:
Selling and marketing 3,500 1,264
Software development 240 118
General and administrative 2,019 899
--------------------
5,759 2,281
--------------------
Loss from operations (2,226) (346)
Interest and other income (expense) 62 (38)
--------------------
Net loss $ (2,164) $ (384)
====================
Basic and diluted net loss per share $ (0.22) $ (0.07)
====================
Weighted average common shares 9,624 5,754
====================
</TABLE>
See accompanying notes.
3
<PAGE> 4
Realty Information Group, Inc.
Condensed Consolidated Balance Sheet
(in thousands)
<TABLE>
<CAPTION>
March 31, December 31,
1999 1998
--------------------------------
ASSETS (unaudited)
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 10,051 $ 19,667
Accounts receivable, less allowance for doubtful
accounts of $424 and $326 as of
March 31, 1999 and December 31, 1998 2,683 1,245
Prepaid expenses and other current assets 513 326
---------------------------------
Total current assets 13,247 21,238
Property and equipment 4,608 3,385
Accumulated depreciation (1,434) (1,228)
---------------------------------
3,174 2,157
Capitalized product development costs, net of accumulated
amortization of $1,333 and $990 as of
March 31, 1999 and December 31, 1998 4,775 1,857
Other assets 19,503 2,098
Deposits 189 192
---------------------------------
Total assets $ 40,888 $ 27,542
=================================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 1,340 $ 801
Accrued wages and commissions 1,736 1,078
Accrued expenses 972 812
Deferred revenue 3,312 1,647
Line of credit 3,000 -
---------------------------------
Total current liabilities 10,360 4,338
Stockholders' equity 30,528 23,204
---------------------------------
Total liabilities and stockholders' equity $ 40,888 $ 27,542
=================================
</TABLE>
See accompanying notes.
4
<PAGE> 5
Realty Information Group, Inc.
Condensed Consolidated Statements of Cash Flows
(in thousands)
(unaudited)
<TABLE>
<CAPTION>
For the Three Months
Ended March 31,
--------------------------
1999 1998
--------------------------
<S> <C> <C>
Operating activities:
Net loss $ (2,164) $ (384)
Adjustments to reconcile net loss to net cash
provided by (used in) operating activities:
Depreciation 206 93
Amortization 845 137
Provision for losses on accounts receivable 98 47
Non cash charges 4 4
Changes in operating assets and liabilities (313) 125
--------------------------
Net cash provided by (used in) operating activities (1,324) 22
Investing activities:
Net purchases of property and equipment (889) (130)
Capitalization of product development costs (410) (95)
Acquisitions (net of acquired cash) (9,993) -
--------------------------
Net cash used in investing activities (11,292) (225)
Financing activities:
Proceeds from line of credit 3,000 -
--------------------------
Net cash provided by financing activities 3,000 -
Net increase (decrease) in cash and cash equivalents (9,616) (203)
Cash and cash equivalents at beginning of period 19,667 1,069
--------------------------
Cash and cash equivalents at end of period $ 10,051 $ 866
==========================
</TABLE>
See accompanying notes.
5
<PAGE> 6
REALTY INFORMATION GROUP, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION
Realty Information Group, Inc. ("the Company") is a Delaware corporation and was
incorporated in February 1998 to succeed its predecessors, Realty Information
Group L.P. ("RIGLP") and OLD RIG, Inc. ("RIGINC"). RIGLP is an operating entity,
while RIGINC is a shell holding entity. In connection with the Company's Initial
Public Offering on July 1, 1998 ("the Offering"), RIGLP and RIGINC merged with
the Company pursuant to the RIG Contribution Agreement dated March 5, 1998. The
limited partners of RIGLP (other than RIGINC) and all of the stockholders of
RIGINC received 3.03 shares of Common Stock of the Company per each limited
partnership unit or share of common stock exchanged, for a total of 5,754,017
shares. As a result of the reorganization of these entities, the Company owns
(directly or indirectly) all of the capital stock of RIGINC and all the equity
of RIGLP.
The merger has been accounted for as a reorganization of entities under common
control similar to a pooling of interests. Following the merger each shareholder
of the Company maintains their exact same ownership of the operating entity,
RIGLP, as before the merger. The transfer of assets and liabilities of RIGLP and
RIGINC have been recorded at the historical carrying values. The financial
statements are presented as if the Company was in existence throughout all
periods presented, as one operating entity. All share amounts have been restated
to reflect the conversion of partnership units to common stock of the Company.
On January 1, 1999, RIGLP and RIGINC were merged into a newly formed
corporation, CoStar Realty Information, Inc. a wholly owned subsidiary of the
Company.
USE OF 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 at the date of the
financial statements and the associated amounts of revenues and expenses during
the reporting period. Actual results could differ from the estimates.
RECENT ACCOUNTING PRONOUNCEMENTS
In March 1998, the Accounting Standards Executive Committee of the AICPA issued
Statement of Position 98-1, Accounting for the Costs of Computer Software
Developed or Obtained for Internal Use ("SOP 98-1"). SOP 98-1, which has been
adopted prospectively as of January 1, 1999, requires the capitalization of
certain costs incurred in connection with developing or obtaining internal use
software. Prior to the adoption of SOP 98-1, the Company expensed all internal
use software related costs as incurred. There was no material impact on the
Statement of Operations for the quarter ended March 31, 1999.
In April 1998, the Accounting Standards Executive Committee of the AICPA issued
Statement of Position 98-5, Reporting the Costs of Start-up Activities ("SOP
98-5"). The Company adopted the provisions of SOP 98-5 as of January 1, 1999.
There was no material impact on the Statement of Operations for the quarter
ended March 31, 1999.
6
<PAGE> 7
2. ACQUISITIONS
On January 8, 1999, the Company acquired all of the common stock of LeaseTrend,
Inc. ("LeaseTrend"), a Cincinnati based provider of commercial real estate
information, for $4,500,000 in cash and 566,671 shares of the Company's Common
Stock. The transaction was accounted for as a purchase and the consideration was
valued for accounting purposes at approximately $9,200,000 including acquisition
expenses.
On January 22, 1999, the Company acquired all of the common stock of Jamison
Research, Inc. ("Jamison"), an Atlanta based provider of commercial real estate
information, for $5,284,000 in cash and 448,031 shares of the Company's common
stock. The transaction was accounted for as a purchase and the consideration was
valued for accounting purposes at approximately $10,300,000 including
acquisition expenses.
The Company adjusted the historical carrying value of certain acquired assets
and liabilities of LeaseTrend and Jamison to fair market value as discussed
below. Working capital and property and equipment accounts of LeaseTrend and
Jamison are recorded at book value, and represent an increase in amounts
allocated to the accounts shown below of approximately $600,000 and $400,000,
respectively. The approximate allocation of purchase price to capitalized
product development costs and intangible assets (including amounts previously
capitalized by LeaseTrend and Jamison) is as follows:
<TABLE>
<CAPTION>
Estimated
LeaseTrend Jamison Totals Life
----------------- ---------------- ----------------- --------------
<S> <C> <C> <C> <C>
Capitalized product development
Developed software products $ 200,000 $ 200,000 $ 400,000 2 years
Proprietary databases 1,100,000 1,300,000 2,400,000 5 years
Other assets
Customer base 8,100,000 8,800,000 16,900,000 10 years
Other intangible assets 400,000 400,000 800,000 2 years
----------------- ---------------- -----------------
$9,800,000 $ 10,700,000 $ 20,500,000
================= ================ =================
</TABLE>
Capitalized product development includes those developed software products and
proprietary databases which are expected to produce revenues currently, until
their conversion by the Company into products with a format consistent with the
Company's products. This effort is expected to take up to 2 years. The
underlying proprietary databases are expected to continue in use beyond the
conversion period.
The Company's unaudited pro forma consolidated condensed statement of operations
for the three months ended March 31, 1999 and 1998, assuming the acquisition of
LeaseTrend and Jamison was effected at the beginning of the period, is
summarized as follows:
<TABLE>
<CAPTION>
For the Three Months
Ended March 31,
---------------------------------------------
1999 1998
---------------------------------------------
<S> <C> <C>
Revenues $ 6,439,000 $4,730,000
================= ==============
Net loss $ (2,308,000) $(932,000)
================= ==============
Weighted average shares 9,786,000 6,769,000
================= ==============
Basic and diluted net loss per share $ (.24) $ (.14)
================= ==============
</TABLE>
7
<PAGE> 8
3. LINE OF CREDIT
In October 1998, the Company renewed its line of credit agreement with Silicon
Valley East (a Division of Silicon Valley Bank). The new line provides for a
total of $5,000,000 in borrowing bearing an interest rate at the bank's prime
rate plus 1%, and has a one-year term. On February 2, 1999, the Company borrowed
$3,000,000 against this line of credit. The proceeds from this borrowing were
repaid on May 13, 1999.
4. PUBLIC OFFERING
On May 10, 1999, the Company completed a public offering of its common stock in
which a total of 3,019,495 shares were issued (including 269,495 shares issued
in connection with the underwriters' over-allotment option) at $34.50 per share.
The total net proceeds to the Company were approximately $97.4 million, after
deducting underwriting discounts and commissions and estimated offering
expenses.
8
<PAGE> 9
ITEM 2
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following Management's Discussion and Analysis of Financial Condition and
Results of Operations contains forward-looking statements, which involve risks
and uncertainties. Our actual results could differ materially from those in such
forward-looking statements as a result of certain factors, including those set
forth in the Company's registration statement filed on Form S-1 on March 24,
1999, and the Company's other filings with the Securities and Exchange
Commission. The following discussion should be read in conjunction with the
Company's filings with the Securities and Exchange Commission and the unaudited
condensed consolidated financial statements included herein.
OVERVIEW
Realty Information Group is the nation's largest digital provider of commercial
real estate information and analysis. We are creating a digital marketplace
where the members of the commercial real estate and related business community
can continuously interact and facilitate transactions by efficiently exchanging
accurate and standardized information. Our wide array of digital service
offerings includes a leasing marketplace, a selling marketplace, decision
support, tenant information, property marketing, and industry news.
Substantially all of our current services are digitally delivered and a majority
of our clients receive daily service updates over the Internet.
We completed our initial public offering in July 1998 and received net proceeds
of approximately $22.7 million. We primarily used those net proceeds to fund the
geographic and service expansion of our business, including three strategic
acquisitions, and to expand our sales and marketing organization. In May 1999,
we completed a follow-on public offering and received net proceeds of
approximately $97.4 million. We expect to use these proceeds primarily for
development and distribution of new services, expansion of all existing services
across our current markets, geographic expansion in the U.S. and international
markets, strategic acquisitions and working capital and general corporate
purposes.
From 1994 through 1998, we expanded the geographical coverage of our existing
services and developed new services. In addition to internal growth, this
expansion included the acquisitions of Chicago ReSource, Inc. in Chicago in 1996
and New Market Systems, Inc. in San Francisco in 1997. In August of 1998, we
expanded into the Houston region through the acquisition of Houston-based real
estate information provider C Data Services, Inc. In January of 1999, we
expanded further by acquiring LeaseTrend and Jamison.
We consider regions that have had ongoing operations for at least 18 months to
be established, and we currently generate positive cash flow from our operations
in each established region. As of March 31, 1999, the following regions are
those that have been in operation for more than 18 months and that we consider
to be established: Washington (includes Baltimore), Chicago, New York (includes
Northern New Jersey, Long Island, Westchester, and Connecticut), Los Angeles
(includes Orange County), San Francisco, and Philadelphia. These regions provide
us with substantial cash flow which we reinvest into the business. Since its
inception, the development of our business has required substantial investments
for the expansion of services and the establishment of operating regions, which
has resulted in substantial net losses on an overall basis.
The incremental cost of introducing new services in an established region in the
future may reduce the profitability of a region or cause it to incur losses. We
expect continued development and distribution of new services, expansion of all
existing services across current markets and geographic expansion in the U.S.
and international markets. Therefore, while we expect operations in existing
established regions to remain profitable and provide substantial funding, we
expect our overall expansion plans to generate significant losses and negative
cash flow from operations for at least the next two years.
9
<PAGE> 10
THREE MONTHS ENDED MARCH 31, 1998 COMPARED TO
THREE MONTHS ENDED MARCH 31, 1999
REVENUES. Revenues increased 116% from $2,839,000 for the three months ended
March 31, 1998 to $6,127,000 for the three months ended March 31, 1999. This
increase in revenue resulted principally from growth in our client base in
established regions of the country, the expansion of emerging regions (Boston,
Sacramento, Houston, Phoenix, and San Diego) and revenues from the newly
acquired Atlanta, Dallas, Midwest, and Florida regions.
GROSS MARGINS. Gross margins increased 83% from $1,935,000 for the three months
ended March 31, 1998 to $3,533,000 for the three months ended March 31, 1999,
while gross margin percentages were 68% and 58%, respectively. The increase in
gross margins resulted from significant revenue growth, while the decline in
gross margin percentages resulted from expansion of services in established
regions, an increase in the number of emerging regions, and lower gross margin
percentages in the newly acquired regions. Furthermore, our cost of revenues for
the three months ended March 31, 1999 includes purchase price amortization from
the LeaseTrend and Jamison acquisitions of approximately $138,000.
SELLING AND MARKETING EXPENSES. Selling and marketing expenses increased 177%
from $1,264,000 for the three months ended March 31, 1998 to $3,500,000 for the
three months ended March 31, 1999. Selling and marketing expenses increased as a
result of the cost of the acquired sales organizations and purchase price
amortization of approximately $353,000 for the Jamison and LeaseTrend
acquisitions during the first quarter of 1999. In addition, continued expansion
of the sales organization and marketing efforts required for growth,
particularly in emerging regions, including Boston, Sacramento, San Diego,
Phoenix, Houston, Tampa, Miami, and Denver, of which only Boston was in
operation during the first quarter of 1998, contributed to the increased
expenses.
SOFTWARE DEVELOPMENT. Software development expenses increased 103% from
$118,000 for three months ended March 31, 1998 to $240,000 for the three months
ended March 31, 1999 reflecting development costs for the expansion of services
for emerging and established regions and new service initiatives.
GENERAL AND ADMINISTRATIVE EXPENSES. General and administrative expenses
increased 125% from $899,000 for the three months ended March 31, 1998 to
$2,019,000 for the three months ended March 31, 1999. General and administrative
expenses increased due to the hiring of new employees to support the expanding
scope of our operation and client base, as well as the increased administrative
costs of a public company. Additionally, our general and administrative expenses
include approximately $83,000 of purchase price amortization from the LeaseTrend
and Jamison acquisitions.
INTEREST AND OTHER INCOME (EXPENSE). Interest and other income increased from an
expense of $38,000 for the three months ended March 31, 1998 to income of
$62,000 for the three months ended March 31, 1999. This was a direct result of
interest earned on the initial public offering proceeds.
10
<PAGE> 11
LIQUIDITY AND CAPITAL RESOURCES
Our cash balance was $10,051,000 at March 31, 1999, a decrease of $9,616,000
from $19,667,000 at December 31, 1998, due principally to the acquisitions of
Jamison and LeaseTrend in January 1999. During the first quarter of 1999, we
financed our operations and growth through cash flow from the established
regions, short-term credit lines and the proceeds of the Initial Public
Offering. Net cash used in operations for the three months ended March 31, 1999
was $1,324,000 compared to net cash provided by operating activities of $22,000
for the three months ended 1998. This was a direct result of increased expansion
in the emerging and acquired regions. Additionally, we received advance payments
from clients on a number of contracts, resulting in the generation of cash as
reflected in deferred revenue balances of $1,647,000, and $3,312,000 as of
December 31, 1998 and March 31, 1999, respectively. We continued to experience
overall operating losses as a result of our recent expansion into emerging and
acquired regions, while established regions continue to generate substantial
cash flow from operations.
Net cash used in investing activities amounted to $11,292,000 for the three
months ended March 31, 1999, including $9,993,000 (net of acquired cash) for the
acquisition of LeaseTrend and Jamison. Additional investing activities included
capitalized product development costs, consisting principally of building
photography, and fixed-asset purchases, consisting principally of computer and
office equipment. We currently have no material commitments for capital
expenditures.
Effective October 5, 1998, we renewed our line of credit and increased the
amount of the facility from $1,000,000 to $5,000,000. On February 2, 1999 we
borrowed $3,000,000 against this line of credit. The proceeds from this
borrowing were repaid on May 13, 1999.
On May 10, 1999, the Company completed a public offering of its common stock in
which a total of 3,019,495 shares were issued (including 269,495 shares issued
in connection with the underwriters' over-allotment option) at $34.50 per share.
The total net proceeds to the Company were approximately $97.4 million, after
deducting underwriting discounts and commissions and estimated offering
expenses.
To date, we have grown in part by acquiring other companies, and we may continue
to make acquisitions. Our acquisitions may vary in size and could be material to
our current operations. We expect to use cash, stock, or other means of funding
to make these acquisitions.
We expect to incur significantly higher costs, particularly as we introduce new
and upgraded services, expand geographically, and develop the infrastructure to
support the expanding organization and client base. Based on current plans, we
believe that our available cash combined with our line of credit and positive
cash flow from our established regions should be sufficient to fund our
operations for at least the next two years.
Through June 30, 1998, we operated as either a Subchapter S corporation or a
limited partnership, and we were not subject to corporate income taxes. After
June 30, 1998, we became a taxable entity. Although we have experienced losses
to date, future profits, to the extent not offset by the benefits of loss
carryforwards, would result in income tax liabilities. We do not expect to
benefit substantially from tax loss carryforwards generated prior to July 1998.
We do not believe the impact of inflation has significantly affected our
operations.
11
<PAGE> 12
IMPACT OF THE YEAR 2000
We believe that we may be affected by computer problems associated with the Year
2000. The Year 2000 issue arises because some computer hardware and software
will not work properly after 1999. That failure occurs because many older
systems express dates in a two-digit format. For example, under this format the
year 1999 is expressed as 99. As a result, these older systems may be unable to
distinguish between the year 1900 and the year 2000. That inability may cause
hardware system failures, software miscalculations, and disruptions of data
transmissions.
Our plans to resolve the Year 2000 issue involve the following steps:
assessment, remediation, and confirmation through testing. To date, we have
completed our preliminary assessment of the issue and approximately 60% of the
remediation phase. We have undertaken testing as particular aspects of the
remediation phase are completed.
Assessment
Our Year 2000 assessment has included:
- - cataloging and evaluating internal hardware and software systems obtained
from third parties;
- - testing the software we have developed ourselves; and
- - contacting our clients, suppliers, and service providers.
Remediation and Testing Efforts
We have identified three areas that require evaluation and remediation: internal
infrastructure, our proprietary software, and impacts from systems of vendors
and our clients.
Internal Infrastructure. We are currently cataloging and evaluating our hardware
to determine its Year 2000 compliance. Our workstation supplier has informed us
that all workstations we have obtained from it are compliant. We have
successfully completed testing on 20% of those workstations. We have purchased
new, compliant servers to replace older hardware and expect those servers to be
operational by June 1999. We have scheduled our laptops for compliance testing
by June 1999.
We are also in the process of making the software used in our internal
infrastructure Year 2000 compliant. We have already installed a new, compliant
enterprise accounting system. We expect to convert all of our network server
operating systems to compliant software and to replace our non-compliant phone
and voice mail systems with compliant systems by August 1999.
Proprietary Software and Databases. Our commercial real estate information
systems use extensive proprietary software and databases. We performed Year 2000
compliance measures for much of this software in prior years since various
fields, like tenant lease expirations, required compliance in the early 1990's
to accommodate post-2000 dates. Since that time, we have assessed all our
proprietary commercial real estate information software to identify areas
vulnerable to these problems. This led us to recode common date routines,
functions, and methods so they would interpret both entered and stored dates
with a compliant approach. We believe that our proprietary systems are now
compliant, but we might still encounter additional Year 2000 defects. In
addition, we are upgrading our older internal software applications with newer
systems to provide greater assurance of Year 2000 compliance.
We have identified additional potential Year 2000 risks with respect to our
recently acquired LeaseTrend and Jamison subsidiaries. We believe that a
significant percentage of their hardware and internal proprietary software are
non-compliant. We are currently upgrading these computer systems and are
converting the acquired databases into our centralized system to replace the
non-compliant products we acquired used by those subsidiaries. We plan to
complete this process in the next several months in the normal course of
business.
12
<PAGE> 13
Client and Vendor Issues. Our assessment has also revealed that some of our
clients use hardware and software that is not Year 2000 compliant. As a result,
our clients' systems may not support the use of our software. We have notified
our clients of this potential issue. Where we have uncovered such problems, we
have attempted to ensure compatibility by coding our own alternatives or
replacements. Despite these efforts, our clients' success in continuing to
install and use our services depends significantly on their own compliance
efforts, which we do not control. If necessary, we will develop in the next
several months a contingency plan to address problems arising from our clients'
failure to have compliant computer equipment and software.
Third party Year 2000 compliance problems may also affect us by interrupting
services which we need to conduct our business. For example, most of our data
updates are delivered via the Internet. If Year 2000 problems result in
disruption of the Internet as a delivery system, we believe we could use
alternative delivery systems, which would mitigate to some extent the impact of
this disruption. We also rely on telecommunications providers for communication
services and distribution of our product data updates. Any compliance problems
by these providers could lead to extended loss of their services and significant
unanticipated expenses to remedy the situation.
Compliance Costs
Our incremental costs expended to date in connection with Year 2000 compliance
have not been significant, as we have undertaken most of our activities in the
normal course of business. We estimate, however, that during the remainder of
1999 we will spend $1,000,000 in connection with Year 2000 compliance. A large
part of this cost will result from upgrading LeaseTrend and Jamison equipment
and software, much of which was planned independently of the Year 2000 issue.
13
<PAGE> 14
PART II. OTHER INFORMATION
ITEM 1 LEGAL PROCEEDINGS
None
ITEM 2 CHANGE IN SECURITIES
On January 8, 1999, we acquired LeaseTrend Inc., through a transaction in which
Blue Chip Capitol Fund Limited Partnership, Keith D. Sant, and trusts
established by Fred A. Heitzman III and Gregory Benkert (the shareholders of
LeaseTrend) received 566,671 shares of Common Stock and $4,500,000 in cash. The
shares were purchased for investment purposes. The issuance of these shares was
effected in reliance on the exemption from registration under Section 4(2) of
the Securities Act.
On January 22, 1999, we acquired Jamison Research, Inc., in a transaction in
which Henry D. Jamison IV, Leslie Lees Jamison, The Church of the Apostles of
Atlanta and David P. Evemy (the shareholders of Jamison Research and their
assignees) received 448,031 shares of Common Stock and $5,284,000 in cash. These
shares were purchased for investment purposes. The issuance of these shares was
effected in reliance on the exemption from registration under Section 4(2) of
the Securities Act.
No underwriters were involved in either of the foregoing sales of securities.
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 EXHIBITS AND REPORTS ON FORM 8-K
A report on Form 8-K was filed with the SEC on January 22, 1999 reporting, under
Item 2, the acquisition of LeaseTrend, Inc. An amendment to that report filed
with the SEC on March 26, 1999 provided financial statements and financial
information required under Item 7.
A report on Form 8-K was filed with the SEC on February 2, 1999 reporting, under
Item 2, the acquisition of Jamison Research, Inc. An amendment to that report
filed with the SEC on April 7, 1999 provided financial statements and financial
information required under Item 7.
EXHIBIT NUMBER: EXHIBIT DESCRIPTION:
27 Financial Data Schedule
14
<PAGE> 15
SIGNATURES
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.
REALTY INFORMATION GROUP, INC.
Date: May 14, 1999 By: /s/ Frank A. Carchedi
---------------------
Frank A. Carchedi
Chief Financial Officer
(Principal Financial and Accounting Officer
and Duly Authorized Officer)
15
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
The schedule contains summary financial information extracted from the condensed
consolidated balance sheet and statement of operations of REALTY INFORMATION
GROUP, INC. as of and for the three months ended March 31, 1999 and is qualified
in its entirety by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> MAR-31-1999
<CASH> 10,051,000
<SECURITIES> 0
<RECEIVABLES> 3,107,000
<ALLOWANCES> 424,000
<INVENTORY> 0
<CURRENT-ASSETS> 13,247,000
<PP&E> 4,608,000
<DEPRECIATION> 1,434,000
<TOTAL-ASSETS> 40,888,000
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0
0
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</TABLE>
