UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[ x ] Quarterly Report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the quarterly period ended September 30, 2000
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 No. ___________
ORIGIN INVESTMENT GROUP, INC.
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(Exact name of registrant as specified in its charter)
Maryland 36-4286069
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1620 26th Street, Third Floor, Santa Monica, CA 90266
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(Address of principal executive offices) (Zip Code)
(310) 255-8834
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(Registrant's telephone number, including area code)
980 North Michigan Avenue, Suite 1400, Chicago, Illinois 60611
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(Former name, former address and former fiscal year, if changed since last
report)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities and Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the registrant
has been required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes [x] No [ ]
The registrant has 5,353,216 shares of common stock outstanding as of
November 20, 2000.
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS
The accompanying notes are an integral part of these financial statements.
ORIGIN INVESTMENT GROUP, INC.
(A Development Stage Company)
BALANCE SHEETS
September 30, 2000 (Unaudited) and December 31, 2000
<TABLE>
<CAPTION>
ASSETS
September 30, December 31,
2000 1999
---------------- -----------------
---------------- -----------------
<S> <C> <C>
Cash and cash equivalents $33,431 $ 908
Advances to officer for business expenses -- 12,103
Miscellaneous receivable -- 4,250
Prepaid expenses -- 25,000
Other assets 4,000 8,550
Total Current Assets 37,431 50,811
PROPERTY AND EQUIPMENT, Net 2,622 3,822
OTHER ASSETS
Other long term assets 8,339 --
TOTAL ASSETS $48,392 $54,633
</TABLE>
ORIGIN INVESTMENT GROUP, INC.
(A Development Stage Company)
BALANCE SHEETS
September 30, 2000 (Unaudited) and December 31, 1999
LIABILITIES AND STOCKHOLDERS' DEFICIENCY
<TABLE>
<CAPTION>
September 30, December 31,
2000 1999
---------------- -----------------
---------------- -----------------
<S> <C> <C>
LIABILITIES
Accounts payable and accrued expenses $ 61,971 $ 58,062
Loans payable 50,000 --
TOTAL LIABILITIES 111,971 58,062
COMMITMENTS
STOCKHOLDERS' EQUITY
Common stock, $.001 par value, 50,000,000 shares authorized;
5,353,216 and 4,000,000, respectively, issued and outstanding 5,353 4,000
Paid-in-capital 2,471,063 396,000
Options and Warrants (800,543) --
Subscription receivable (705,500) (198,000)
Deficit accumulated during development stage (1,033,952) (205,429)
TOTAL STOCKHOLDERS' DEFICIENCY (63,579) (3,429)
TOTAL LIABILITIES AND STOCKHOLDERS'
DEFICIENCY $ 48,392 $ 54,633
</TABLE>
(A Development Stage Company)
STATEMENTS OF OPERATIONS (UNAUDITED)
For the Three Months and Nine Months ended September 30, 2000 and 1999 and
for the Period April 6, 1999 (Inception) Through September 30, 2000
<TABLE>
<CAPTION>
For the
Period April
6, 1999
(Inception)
through
Three Months Ended Nine Months Ended September
September 30, September 30, 30,
------------------------------- ------------------------------- --------------
--------------- --------------- --------------- --------------- --------------
2000 1999 2000 1999 2000
--------------- --------------- --------------- --------------- --------------
--------------- --------------- --------------- --------------- --------------
<S> <C> <C> <C> <C> <C>
OPERATING EXPENSES
Professional fees 8,995 -- 164,170 -- 273,612
Travel and entertainment 30,049 -- 183,697 -- 215,352
Office expenses 15,969 -- 62,104 -- 85,111
Payments to
officers/directors 51,142 -- 112,921 -- 112,921
Others 17,905 -- 69,510 -- 104,776
TOTAL OPERATING
EXPENSES 124,060 -- 592,402 -- 791,772
OTHER EXPENSES
Interest expense, net 36,277 -- 36,121 -- 36,121
Other expenses -- -- 200,000 -- 206,059
TOTAL OTHER
EXPENSES (INCOME) (36,277) -- 236,121 -- 242,180
NET LOSS $(160,337) $-- $(828,523) $-- $(1,033,952)
NET LOSS PER COMMON SHARE
- BASIC $(0.03) -- $(0.19) -- $(0.24)
- DILUTED $(0.03) -- $(0.17) -- $(0.22)
WEIGHTED AVERAGE SHARES OUTSTANDING
- BASIC 4,875,460 -- 4,445,868 -- 4,224,573
- DILUTED 5,254,735 -- 4,825,143 -- 4,603,848
</TABLE>
The accompanying notes are an integral part of these financial statements.
ORIGIN INVESTMENT GROUP, INC.
(A Development Stage Company)
STATEMENTS OF STOCKHOLDERS' DEFICIENCY
For the Period April 6, 1999 (Inception) through December 31, 1999 and
--------------------------------------------------------------------------------
For the Nine Months ended September 30, 2000 (unaudited)
<TABLE>
<CAPTION>
Deficit
Accumulated
Issuance Of Shares Of During
Common Stock Paid-in Options and Subscription Development
Issued On: Common Stock Capital Warrants Receivable Stage Total
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Shares Amount
<S> <C> <C> <C> <C> <C> <C> <C>
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
5/5/99 - 12/3/99 4,000,000 4,000 $ 396,000 $ -- $198,000) $ -- $ 202,000
Net loss -- -- -- -- -- (205,429) (205,429)
BALANCE AT 12/21/99 4,000,000 4,000 396,000 -- (198,000) (205,429) (3,429)
1/18/2000 100,000 100 99,900 -- -- -- 100,000
2/12/2000 21,390 21 99,977 -- -- -- 99,998
4/14/2000 50,000 50 49,950 -- -- -- 50,000
5/8/2000 142,000 142 106,358 -- -- -- 106,500
5/30/2000 324,999 325 243,425 -- -- -- 243,750
6/12/2000 20,000 20 24,980 -- -- -- 25,000
8/24/2000 344,827 345 99,655 -- -- -- 100,000
9/12/2000 350,000 350 507,150 -- (507,500) -- --
Issuance of warrants -- -- 843,668 (800,543) -- -- 43,125
Net loss -- -- -- -- -- _ (828,523) (828,523)
BALANCE AT 9/30/00 5,353,216 5,353 $2,471,063 $(800,543) $(705,500) $(1,033,952) $ (63,579)
The accompanying notes are an integral part of these financial statements.
</TABLE>
ORIGIN INVESTMENT GROUP, INC.
(A Development Stage Company)
STATEMENTS OF CASH FLOWS (UNAUDITED)
For the Nine Months Ended September 30, 2000 and
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For the period April 6, 1999 (Inception) Through September 30, 2000
<TABLE>
<CAPTION>
For the Period
April 6, 1999
(Inception)
Through
September 30, September 30,
2000 2000
---------------- -----------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $(828,523) $(1,033,952)
Adjustments to reconcile net loss
to net cash used in operating activities:
Depreciation and amortization 1,200 1,589
Amortization of financing costs 43,125 43,125
Decrease in miscellaneous receivable 4,250 --
Decrease in advances to Officer 12,103 --
Decrease in prepaid expenses 25,000 --
Increase in other assets (3,113) (11,663)
Increase in accounts payable and accrued expenses 3,909 61,971
TOTAL ADJUSTMENTS 86,474 95,022
NET CASH PROVIDED BY OPERATING ACTIVITIES (742,049) (938,930)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of office equipment -- (4,211)
Purchase of investment securities (676) (676)
NET CASH USED IN INVESTING ACTIVITIES (676) (4,887)
CASH FLOWS PROVIDED BY FINANCING ACTIVITIES
Proceeds from common stock issuance 725,248 927,248
Proceeds from notes payable 80,992 80,992
Repayment of note payable (30,992) (30,992)
NET CASH USED IN FINANCING ACTIVITIES 775,248 977,248
NET INCREASE IN CASH AND
CASH EQUIVALENTS 32,523 33,431
CASH AND CASH EQUIVALENTS - Beginning 908 --
CASH AND CASH EQUIVALENTS - Ending $ 33,431 $ 33,431
</TABLE>
ORIGIN INVESTMENT GROUP, INC.
(A Development Stage Company)
STATEMENTS OF CASH FLOWS (UNAUDITED), continued
For the Nine Months Ended September 30, 2000 and
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For the period April 6, 1999 (Inception) Through September 30, 2000
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
<TABLE>
<CAPTION>
For the Period
April 6, 1999
(Inception)
Through
September 30, September 30,
2000 2000
---------------- -----------------
<S> <C> <C>
Cash paid during the years for:
Interest $50 $50
Non-cash financing activities:
Subscription receivable for common stock subscribed
in connection with an offering $507,500 $705,500
</TABLE>
ORIGIN INVESTMENT GROUP, INC.
NOTES TO FINANCIAL STATEMENTS
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NOTE 1 - Description of Business
Origin Investment Group, Inc. (the "Company") was incorporated on April 6,
1999 and is in the business of venture capital, which is providing growth
capital to emerging companies. The Company has elected to be regulated as a
business development company under the Investment Company Act of 1940 and will
operate as a nondiversified company. Since its inception, the Company's efforts
have been devoted to raising capital and seeking out companies to invest in.
Accordingly, through the date of these financial statements, the Company is
considered to be in the development stage and the accompanying financial
statement represent those of a development stage enterprise.
The Company has experienced losses since inception and has negative cash
flows from operations and has a stockholders' deficiency. For the quarter ended
September 30, 2000, the Company experienced a net loss of $160,337.
The Company's ability to continue as a going concern is contingent upon its
ability to raise additional capital. In addition, the Company's ability to
continue as a going concern must be considered in light of the problems,
expenses and complications frequently encountered by entrance into established
markets and the competitive environment in which the Company operates.
Management is pursuing various sources to raise capital and has purchase
agreements in place to acquire certain companies, contingent on due diligence
and the ability to raise capital when needed or obtain such on terms
satisfactory to the Company, if at all. Failure to raise capital may result in
the Company depleting its available funds and not being able to fund its
investment pursuits.
NOTE 2 - Presentation
The accompanying balance sheet of the Company as of September 30, 2000, the
related statement of operations and cash flow for the nine months ended
September 30, 2000 have been prepared, without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission. Certain information and
footnote disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles have been condensed or
omitted pursuant to such rules and regulations, although the Company believes
that the disclosures are adequate to make the information presented not
misleading. The condensed financial statements and these notes should be read in
conjunction with the financial statements of the Company included in the
Company's Annual Report of Form 10-K for the period from inception (April 6,
1999) through December 31, 1999. The balance sheet at December 31, 1999 has been
derived from the audited financial statement at that date and condensed.
NOTE 2 - Presentation, continued
The information furnished herein reflects all adjustments consisting only
of normal recurring accruals which are, in the opinion of management, necessary
for a fair presentation of the results of operations for the interim period.
Results of operations for the nine months ended September 30, 2000 are not
necessarily indicative of results to be expected for the entire year.
NOTE 3 - Status of Purchase of Encore Investments and Sigma Solutions
The Company was not able to raise the requisite amount of capital necessary
to close the purchase of stock of Encore Investments, Inc. and Sigma Solutions,
Inc. as outlined in the agreement dated December 31, 1999. The closing was to
occur on or before May 16, 2000. Thus, at the present time, the Company and
Encore Investments, Inc. and Sigma Solutions, Inc. are currently no longer
contractually obligated to consummate a purchase and sale of Encore Investments,
Inc. and Sigma Solutions, Inc. stock. The Company has been in discussions with
the principals of Encore/Sigma and the principals have agreed to revisit the
purchase opportunity upon the Company's ability to secure funds necessary to
purchase Encore Investments, Inc. and Sigma Solutions, Inc. stock. Accordingly,
the break up fee paid to the principals of Encore/Sigma by the Company in the
amount of $200,000 has been forfeited by the Company.
NOTE 4 - Return of Funds Held in Escrow Re Encore/Sigma Transaction
On June 23, 2000, the Company returned to its Class 1 Series A Convertible
Preferred Stockholders an aggregate of $638,762.50 plus interest accrued from
the date the escrow was established to the date of the disbursements. These
funds, previously classified as "restricted cash" were returned to the Class 1
Preferred stockholders in connection with the escrow agreement, which indicated
that in the event that the purchase of Encore Investments, Inc. and Sigma
Solutions, Inc. was not consummated, all funds deposited within the escrow
account, plus interest accrued, would be returned to all Class 1 Preferred
Stockholders.
NOTE 5 - Equity Transactions
The Company sold 100,000 shares of common stock to an investor on January
18, 2000 for $100,000 and sold 21,390 shares of common stock for $99,998 to
another on February 12, 2000. The price of the common stock for the January 19,
2000 sale was based on the Company's reasonable estimate as to the market value
of the stock, as the Company's stock had not commenced trading as of that date.
This estimate had no basis on the net asset value of the stock, which was
considerably lower, nor was any other NOTE 5 - Equity Transactions, continued
quantifiable factor used to determine the stock price offered to the
accredited investor at the time. The price of the common stock for the February
12, 2000 sales was equal to the closing bid price of the common stock on the
date of sale. These investors were persons personally know to Origin officers.
Each of the sales was conducted according to the requirements of Regulation E,
exempting the shares issued from registration.
The Company sold 50,000 shares of common stock on April 14, 2000 to an
investor personally known to Origin officers. These shares are restricted from
resale pursuant to Rule 144 of the Securities Act of 1933.
On May 8, 2000 the Company sold 142,000 Units to eleven accredited
investors for an aggregate of $106,500 or $0.75 per Unit. Each Unit was
comprised of one share of common stock and one Class A common stock purchase
warrant. Each Class A common stock purchase warrant is redeemable for one
restricted common stock upon a payment of $.75 per warrant. The price of the
Unit was equal to the closing bid price of the Company's common stock on the
date of sale. The Unit sales were conducted according to the requirements of
Regulation E, exempting the common stock portion of the Unit from registration
under the Securities Act of 1933. The Class A warrants nor the underlying common
stock were registered or filed for exemption pursuant to Regulation E.
On May 30, 2000 the Company converted each Class 2 Series A Convertible
Preferred Stock and restricted stock award issued in connection therewith into
383.33 Units. Each Class 2 Series A Convertible Preferred shareholder was
comprised of one common stock and one Class B Common Stock Purchase Warrant
where each Class B Common Stock Purchase Warrant is redeemable for one common
stock upon the payment of $1.50 to the Company by the warrant holder. As a
result of this conversion, the Company issued 324,999 shares of common stock to
the Class 2 Series A Convertible Preferred Stockholders.
On June 12, 2000 the Company sold 20,000 shares of its restricted common
stock to two accredited investors for $25,000 or $1.25 per share. This sale was
conducted in accordance to Section 4(6) of the Securities Act of 1933 as a
private placement transaction.
On August 24, 2000 the Company sold an aggregate of 344,827 shares of
common stock to ten investors at a purchase price of $.29 per share, based on
the closing bid price on that date. Total funds received was $99,999.98. The
shares were exempt pursuant to being issued in accordance with Rule 606 of
Regulation E of the Securities Act of 1933. These shares were issued to
accredited investors and a Form 1-E was filed with the Securities and Exchange
Commission.
On September 12, 2000, the Company sold an aggregate of 350,000 shares of
its common stock to an accredited investor residing in Frankfurt, Germany at a
purchase price of $1.45 per share. The offering was conducted pursuant to and in
accordance with Regulation E. The Company received an aggregate of $507,500 from
the sale during the month of October, 2000 and booked the transaction as a
subscription receivable during the Third Quarter.
NOTE 6 - Short Term Bridge Loan
On July 10, 2000, July 19, 2000, August 9, 2000 and August 10, 2000 the
Company received an aggregated of $80,992 in the form of short term bridge loans
from four accredited investors. These bridge loans varied in duration between
one month and three months prior to maturity and carried simple interest rates
between 8-12% per annum. Each bridge loan payee also received an issuance of
Class A Common Stock Purchase Warrants for an aggregate of 248,968 warrants,
exercisable at $.40 per share that were redeemable for between one to four
shares of common stock for every dollar loaned. As of the date of this quarterly
report filing, all principal and interest had been returned to each of the four
accredited investors.
ORIGIN INVESTMENT GROUP, INC.
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
Except for historical information, the following discussion of our
financial condition and results of operations contains forward looking
statements based on current expectations that involve certain risks and
uncertainties. Our actual results could differ materially from those set forth
in these forward-looking statements as a result of a number of factors. Unless
specified otherwise, the terms, "we", "us", "our", "the company", and "Origin"
refer to Origin Investment Group, Inc.
Overview
We are a business development company incorporated in the State of Maryland
on April 6, 1999. We are in the start up stage and we have not had any revenues
to date and we have not made any investments. Since inception our operations
have been limited to identifying, investigating and conducting due diligence
upon private companies involved within the Information Technology industry for
the purpose of investing in such companies. Our strategy is to identify several
profitable IT service businesses, invest in such companies, consolidate their
operations and technologies to create a profitable e-business solutions company.
Our financial statements are presented on a going concern basis, which
contemplates the realization of assets and satisfaction of liabilities in the
normal course of business.
We have experienced a loss since inception and have negative cash flows
from operations and have a stockholder's equity deficiency. For the period ended
September 30, 20000, we experienced a net loss of $160,337.
Our ability to continue as a going concern is contingent upon our ability
to raise additional capital. In addition, the ability to continue as a going
concern must be considered in light of the problems, expenses and complications
frequently encountered by entrance into established markets and the competitive
environment in which we operate.
The report of the Company's Independent Certified Public Accountants'
includes an explanatory paragraph expressing substantial doubt about the our
ability to continue as a going concern. The financial statements do not include
any adjustments to reflect the possible future effects on the recoverability and
classification of assets or the amounts and classification of liabilities that
may result from our possible inability to continue as a going concern.
Liquidity and Capital Resources
Since our inception, we have funded our operations solely through payments
received from the sale of our equity securities and from short term bridge loans
received from certain accredited investors. Our current liquidity and capital
resources are contingent on our ability to continue to fund our operations
through the sale of our equity securities. If we are unsuccessful in continuing
to raise capital through the sale of our securities, we will have difficulty in
meeting our short term obligations and may cease to continue as a going concern.
Our ability to sell our equity securities to fund operations and to make
investments within identified eligible portfolio companies, in large part, is
contingent upon the depth and liquidity of our secondary market of our common
stock. Any failure to raise sufficient capital pursuant to the current or future
Origin offerings could require us to substantially curtail our
portfolio-investment acquisition efforts in general, and could require us to
cease operations.
Our cash flow requirements have continuously exceeded our capital resources
during the quarter, requiring us to issue additional equity securities for sale
to meet our short term obligations. We anticipate operating at such a deficit
for the next several months until we are able to secure additional working
capital.
INCREASE TO STRUCTURED EQUITY FUNDING LINE
One September 12, 2000 we entered into a revised agreement ("Revised FFC
Agreement") with First Fidelity Capital, Inc. ("FFC") an investment advisor to
the Alpha Group of Funds, ("Alpha Funds"), whereby the Alpha Funds have
committed to purchase an initial five million dollars ($5,000,000) as previosuly
agreed pusuant to our June 14, 2000 FFC Agreement (See Form 10-Q for Second
Quarter 2000 incorporated by reference herein) of our common stock and increase
and have amended this commitment whereby Alpha Funds agree to purchase an
additional five million dollars ($5,000,000) of our common stock if we draw down
at least two million dollars ($2,000,000) during the first six months upon
commencement of the funding line. The Structured Equity Funding Line is subject
to, among other things, the completion of a Regulation E Common Stock Private
Equity Line Subscription Agreement ("Subscription Agreement") and obtaining
third party approvals and opinions. Our ability to draw on this Structured
Equity Funding Line is directly tied to the trading activity within our common
stock on the over-the-counter market. Our Put Right is limited to a maximum of
$500,000 and a minimum of $100,000 but is subject always to a limit of two (2)
times the "Trading Volume" on the trading day immediately preceding delivery of
the draw notice by us to the Alpha Funds. As of the date of filing this Form
10-Q quarterly rreport, we are in the process of finalizing negotiations and
approving definitive agreements associated with securing the Structured Equity
Funding Line.
Management is confident that further amounts of equity capital in the form
of additional equity lines of credit as well as private placement and secondary
offerings will be available to the Company after the Company successfully
commences a public and investor relations campaign to bring awareness to the
Company's business plan and to the businesses in which Origin will invest. Such
a campaign of public and investor relations has not yet commenced since
management has held the position from inception that such a campaign should only
commence once one or more eligible portfolio companies have been successfully
identified and agreements to invest in such companies are in place.
Results of Operations
Our operations have been limited to obtaining additional capital through
the sale of our equity securities, obtaining short term bridge loans and
negotiating with additional potential eligible portfolio companies for possible
investment. To date we have had negative cash flows and anticipate continuing to
do so in the near future. We anticipate that upon completion of an investment
within an eligible portfolio company, our operational costs will increase
substanially in light of the need to hire additional personnel, including a
Chief Financial Officer and additional support staff.
Our strategy and plan for the remainder of this fiscal year is to raise
additional capital through the sale of our stock and purchase controlling
interests within one or more profitable private businesses involved in the
Internet infrasturcture and services sector of the IT industry. Our investment
strategy is to acquire controlling interests within two or more "core"
profitable IT businesses involved in ASP, Systems Integration and Internet
Services to create, on consolidation of such entities, a profitable e-business
solutions company that provides its customers with web/e-commerce applications,
IT consulting and solutions and other value added services and which utilizes
ASP delivery and co-location hosting strategies on a cost effective basis to end
users. We intend on creating such an eligible portfolio company by consolidating
one or more systems integrators, value added resellers and a cutting edge
e-business solutions companies that we have identified and may identify over the
next several months. Our initial investments will be within these "core"
businesses that have built and have executed profitable business models and
therafter combine such core businesses with technology resources found within
development stage Internet web design and e-commerce integration companies.
SPECIAL NOTICE REGARDING FORWARD LOOKING STATEMENTS
This Form 10-Q, the quarterly report, and certain information provided
periodically in writing or orally by the Company's Officers or its agents
contains statements which constitute "forward-looking statements" within the
meaning of Section 27A of the Securities Act, as amended and Section 21E of the
Securities Exchange Act of 1934. The words "expect," "believe," "plan,"
"intend," "estimate", "anticipate", "strategy", "goal" and similar expressions
and variations thereof if used are intended to specifically identify
forward-looking statements. Those statements may appear in a number of places in
this Form 10-Q and in other places, particularly, "Management's Discussion and
Analysis of Financial Condition and Results of Operations", and include
statements regarding the intent, belief or current expectations of the Company,
its directors or its officers with respect to, among other things:
(i) the successful completion of investment(s) within one or more eligible
portfolio companies that we have identified, (ii) our liquidity and capital
resources; and (iii) our future performance and operating results.
Investors and prospective investors are cautioned that any such
forward-looking statements are not guarantees of future performance and involve
risks and uncertainties, and that actual results may differ materially from
those projected in the forward-looking statements as a result of various
factors. The factors that might cause such differences include, among others,
the following:
(i) any adverse effect or limitations caused by any governmental
regulations or actions; (ii) any increased competition in our business of
providing venture capital to eligible portfolio companies; (iii) successfully
identifying, negotiating, structuring and making investments within one or more
eligible portfolio companies; (iv) our ability to raise necessary investment
capital within the time frame agreed to between us and the principals of an
eligible portfolio company in order to successfully invest in such eligible
portfolio company; (v) the continued relationship with and success of the
management and owners of an eligible portfolio company after our investment; and
(vi) the continued performance of our eligible portfolio companies with
respect to their operations, including, but not limited to:
a. continued employment of key personnel, hiring of qualified additional
personnel;
b. the eligible portfolio company's mitigation of excessive and
extraordinary costs, and achieving projected profits and additional
customers for their growth.
c. Any other factors which would otherwise impede our eligible portfolio
company in achieving its performance goals upon which we based a
favorable return on our investment.
We undertake no obligation to publicly update or revise the forward looking
statements made in this Form 10-Q or annual report to reflect events or
circumstances after the date of this Form 10-Q and annual report or to reflect
the occurrence of unanticipated events.
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
We have no securities that are subject to interest rate fluctuations,
foreign currency risk, commodity price or any other relevant market risks during
the period covered by this Quarterly Report. We have not entered into any
hedging transactions or acquired any derivative instruments during the period
covered by this Quarterly Report.
PART II - OTHER INFORMATION
Item 2. Changes in Securities and Use of Proceeds.
Recent Sales of Unregistered Securities; Use of Proceeds from Registered
Securities
On April 14, 2000 we sold directly to a known accredited investor 50,000
shares of common stock, restricted pursuant to Rule 144, for $50,000 or $1.00
per share. This transaction was conducted privately in reliance on Sections 4(2)
and/or 4(6) of the Securities Act of 1933.
On July 10, 2000, July 19. 2000, August 9, 2000, and August 10, 2000 the
Company received an aggregate of $80,992 in the form of short term bridge loans
from four accredited investors. These bridge loans varied in duration between
one month and three months prior to maturity and carried simple interest rates
between 8-12% per annum. Each bridge loan payee also received an issuance of
Class A Common Stock Purchase Warrants, exercisable at $.40 per share that were
redeemable for between one to four shares of common stock for every dollar
loaned. As of the date of this quarterly report filing, all principal and
interest had been returned to each of the four accredited investors.
On August 24, 2000 the Company sold an aggregate of 344,827 shares of
common stock to ten investors at a purchase price of $.29 per share, based on
the closing bid price on that date. Total funds received was $99,999,98. The
shares were exempt pursuant to being issued in accordance with Rule 606 of
Regulation E of the Securities Act of 1933. These shares were issued to
accredited investors and a Form 1-E was filed with the Securities and Exchange
Commission.
Item 5. Other Items
On September 8, 2000, the Company relocated its headquarters from Chicago,
Illinois to Santa Monica, California. The new address for its corporate
headquarters and phone number are: 1620 26th Street, Third Floor, Santa Monica,
California 90404. Phone # 310-255-8834.
On September 12, 2000, the Company sold an aggregate of 350,000 shares of
its common stock to an accredited investor residing in Frankfurt, Germany at a
purchase price of $1.45 per share. The offering was conducted pursuant to and in
accordance with Regulation E. The Company received an aggregate of $507,500 from
the sale during the month of October, 2000 and booked the transaction as a
subscription receivable during the Third Quarter.
Item 6. Exhibits and Reports on Form 8-K.
1. Exhibits
Exhibit Description
3.1 Articles of Incorporation of Origin filed on April 6, 1999
(incorporated by reference to Exhibit 3(i) to Form 10 filed by Origin
on August 16, 1999)
3.2 Bylaws of Origin. (Incorporated by reference to Exhibit 3(ii) to Form
10 filed by Origin on August 16, 1999)
4.1 Form 1-E. (Incorporated by reference to Form 1-E filed on August 10,
2000 in connection with Rule 606 Regulation E offering.
27 Financial Data Schedule.
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 on November 21
2000 by the undersigned thereunto duly authorized.
ORIGIN INVESTMENT GROUP, INC.
/s/ OMAR A. RIZVI
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Omar A. Rizvi
President, Chairman of the Board of Directors
