UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549


FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933



[ALPCS1102417002.GIF]

( Exact name of registrant as specified in its charter)


Delaware

(State or other jurisdiction of

incorporation or organization)

 

6162

(Primary Standard Industrial

Classification Code Number)

 

90-0998139

(I.R.S. Employer

Identification No.)


200 East Campus View Blvd.

Suite 200

Columbus, OH 43235

(305) 704-3294

(Address, including zip code, and telephone number,

including area code, of registrant’s principal executive officer)


Todd C. Buxton

CEO

200 East Campus View Blvd.

Suite 200

Columbus, OH 43235

(305) 704-3294

Name, address, including zip code, and telephone number,

including area code, of agent for service)


Copies to:

Dale S. Bergman, Esq.

Gutiérrez Bergman Boulris, PLLC

100 Almeria Avenue, Suite 340

Coral Gables, Florida 33134

(305) 358-5100


Approximate date of commencement of proposed sale to the public:  From time to time after the effective date of this Registration Statement.


If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act, check the following box.   þ


If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.   o






If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.   o


If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.   o


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


Large accelerated filer o

Accelerated filer o

Non-accelerated filer o

Smaller reporting company x

(Do not check if a smaller reporting company)

 




Calculation of Registration Fee


Title of Each Class of

Securities to be Registered

Amount

to be

Registered

Proposed Maximum

Offering Price

Per Share

Proposed Maximum

Aggregate Offering Price

Amount of

Registration Fee

Common Stock, $0.001 par value

1,217,534

(1)(2 )

$15.00

(2)(3)

$18,263,010

$2,274

Common Stock, $0.001 par value

33,333,333

(4)

$15.00

(3)

$500,000,000

$62,250

Total

34,550,867

(2)

 

 

$518,263,010

$64,524


(1)

Represents shares of our common stock to be offered by the selling stockholders named herein at an offering price of $15.00 per share.


(2)

The selling stockholder swill offer the shares at $15.00 per share until the Company’s shares are quoted on the OTCQX or the OTCQB tiers of the over-the-counter-market operated by OTC Markets Group, Inc. and, assuming we secure this quotation, thereafter at prevailing market prices or privately negotiated prices.


(3)

The offering price has been estimated solely for the purpose of computing the amount of the registration fee in accordance with Rule 457.


(4)

Represents 33,333,333 shares of our common stock to be sold in a direct public offering at an estimated offering price of $15.00 per share.


The registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until this Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.





















2




The information in this preliminary prospectus is not complete and may be changed.  We may not sell these securities nor may offers to buy these securities be accepted until the registration statement filed with the Securities and Exchange Commission becomes effective.  This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.


SUBJECT TO COMPLETION, DATED OCTOBER 27, 2017


PROSPECTUS


34,550,867 Shares of Common Stock


[ALPCS1102417004.GIF]

200 East Campus View Blvd.

Suite 200

Columbus, OH 43235

(305) 704-3294


Alpha Investment Inc. (the “ Company ”) is offering directly up to 33,333,333 shares of our common stock (“ Shares ”) at a fixed offering price of $15.00 per Share for the duration of this offering (the “ Direct Offering ”).  This prospectus also covers 1,217,534 Shares which may be offered and sold by the selling stockholders named in this prospectus.  Our Shares are quoted on the OTC Pink tier of the over-the counter market operated by OTC Markets Group, Inc. (“ OTC Markets Group ”) under the symbol “ ALPC .” However, the trading market for our Shares has been extremely limited and there have only been minimal and sporadic public quotations for our Shares.  On October 24, 2017, the most recent date for which a quotation for our Shares is available, the closing sale price for our common stock on OTC Pink was $0.75 per Share as reported by OTC Markets Group. Given the foregoing, the selling stockholders will offer its Shares at a fixed offering price of $15.00 per Share until a liquid market develops on OTC Pink or any other tier of tier of the over-the counter market operated by OTC Markets Group or any other national securities exchange.  There can be assurance given that any liquid public market for our Shares will develop and be sustained.


The Shares in the Direct Offering are being offered and sold in a direct public offering on a “ self-underwritten, best efforts ” basis, which means (a) no minimum number of Shares need be subscribed for in order for the Company to consummate the sale of any of the Shares and utilize the proceeds therefrom; and (b) the Company will not use the services of an underwriter and our executive officers and directors will attempt to sell the Shares directly to investors.  The intended methods of communication with potential investors include, without limitation, telephone and personal contacts. The Company’s executive officers and directors may also reach out to personal contacts such as family, friends and acquaintances and may conduct investment presentations in the form of a roadshow at various industry and investor conferences. Subscription proceeds for Shares sold in the Direct Offering will be paid directly to the Company and will not be held in a segregated or escrow account. Our executive officers and directors will not receive commissions or any other remuneration from any such sales.


The Shares in the Direct Offering will be offered for sale for a period of one hundred and eighty (180) days from the date of this prospectus, unless extended by our board of directors for period or periods of up to an aggregate of an additional one hundred and eighty (180) days.


We will receive all proceeds from the offer and sale of the Shares in the Direct Offering. We will not receive any proceeds from the offer and sale of the Shares by the selling stockholder named in this prospectus.


The Company is an “ emerging growth company ” under the Jumpstart Our Business Startups Act of 2012 (the “ Jobs Act ”) and as such, may elect to comply with certain reduced public company reporting requirements for future filings.




3




The purchase of the Shares offered through this prospectus involves a high degree of risk.  See the section of this prospectus entitled “Risk Factors” beginning at page 10.


Neither the Securities and Exchange Commission (the “ SEC ”) nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus.  Any representation to the contrary is a criminal offense.


This prospectus is not an offer to sell, nor is it a solicitation of an offer to buy, our common stock in any jurisdiction in which such offer or sale is not permitted.



The date of this prospectus is , 2017

















4




TABLE OF CONTENTS


 

Page

Prospectus Summary

6

Summary Financial Information

9

Risk Factors

10

Special Note Regarding Forward-Looking Statements

17

Use of Proceeds

18

Capitalization

19

Dilution

19

Selling Stockholders

21

Market for Common Equity and Related Stockholder Matters

23

Proposed Business

24

Management’s Discussion and Analysis of Financial Condition and Results of Operations

28

Management

30

Executive Compensation

31

Principal Stockholders

33

Certain Relationships and Related Transactions

33

Plan of Distribution

35

Experts

36

Available Information

36

Disclosure of Commission Position on Indemnification for Securities Act Liabilities

36

Index to Financial Statements

F-1


You should rely only on the information contained in this prospectus. We have not authorized any dealer, salesperson or other person to provide you with information concerning us, except for the information contained in this prospectus. The information contained in this prospectus is complete and accurate only as of the date on the front cover page of this prospectus, regardless when the time of delivery of this prospectus or the sale of any common stock. This prospectus is not an offer to sell, nor is it a solicitation of an offer to buy, our common stock in any jurisdiction in which such offer or sale is not permitted.


  Unless otherwise indicated, information contained in this prospectus concerning our industry and the markets in which we operate or plan to operate, including our general expectations and market position, market opportunity and market share, is based on information from our own management estimates and research, as well as from industry and general publications and research, surveys and studies conducted by third parties. Management estimates are derived from publicly available information, our knowledge of our industry and assumptions based on such information and knowledge, which we believe to be reasonable. Our management estimates have not been verified by any independent source, and we have not independently verified any third-party information. In addition, assumptions and estimates of our and our industry’s future performance are necessarily subject to a high degree of uncertainty and risk due to a variety of factors, including those described in “ Risk Factors .” These and other factors could cause our future performance to differ materially from our assumptions and estimates. See “ Special Note Regarding Forward-Looking Statements .”











5





PROSPECTUS SUMMARY


This summary provides an overview of all material information contained in this prospectus.  It does not contain all the information you should consider before making a decision to purchase our Shares offered hereby.  You should very carefully and thoroughly read the more detailed information in this prospectus and review our financial statements and all other information that is included in this prospectus.


Unless the context otherwise requires, references in this prospectus to “ Alpha Investment ,” “ ALPC ,” “ the Company ,” “ we ,” “ our ” and “ us ” refers to Alpha Investment Inc.


Overview


We intend to provide capital directly to affiliated lenders to fund loans through their correspondent platforms and funding to small businesses in the commercial real estate and other asset-backed markets.  We also intend to acquire and manage performing commercial first mortgage loans, subordinate financings, commercial mortgage-backed securities and other commercial real estate-related debt investments, as well as engage in various direct participation equity ownership opportunities.  We expect to offer financing platforms across a broad-spectrum of asset types at all points within an asset’s capital structure.  Alpha Investment plans to leverage on the industry experience, platforms and resources of its principal stockholder, Omega Commercial Finance Corp, a publicly-held Wyoming corporation (“ Omega ”) and Omega’s affiliates, in order to expedite and facilitate ALPC’s ability to underwrite and structure complex financing transactions and enable the Company to develop and implement customized creative capital solutions for other lenders, mortgage bankers, borrowers, and owners.


Alpha’ Investments capital resources have been limited to date, which has restricted its business activities to organizational matters, as well as planning implementation of its proposed business.  Alpha Investment’s ability to implement that plan will be subject to raising significant capital, primarily from the proceeds of the Direct Offering.


Corporate History and Recent Developments


We were incorporated in the State of Delaware on February 22, 2013, to develop, create, manufacture and market, toys for small children which would be designed to attach to car seats and amuse and entertain children during a drive, without distracting the attention of the driver.  The Company, however, encountered significant constraints in raising sufficient capital to fully implement its business plan.


On March 17, 2017, Omega purchased all 35,550,000 outstanding “ restricted ” shares of the Company’s common stock (the “ Control Share Sale ”) from Malcolm Hargrave (35,000,000 shares), DTH International Corporation (500,000 shares) and Lisa Foster (50,000 shares) for aggregate consideration of $295,000.  The Control Share Sale was consummated in a private transaction pursuant to a common stock purchase agreement entered between Omega and Mr. Hargrave, acting individually and on behalf of the other selling stockholders.  Upon completion of the Control Share Sale, a “ Change in Control” of the Company took place and in connection therewith, Mr. Hargrave resigned as our sole director and officer and Omega, as the new majority stockholder of the Company, elected Timothy R. Fussell, Ph.D. as President, Chairman of the Board and a director and Todd C. Buxton, Omega’s Chief Executive Officer, as Chief Executive Officer, Vice Chairman of the Board and a director.


In addition to the foregoing, new management elected to focus the shift in the Company’s business focus to real estate and other commercial lending, which they believed offered better opportunities for shareholder growth.  In connection therewith, on March 30, 2017, we filed a Certificate of Amendment to our Certificate of Incorporation with the Delaware Secretary of State changing our name from “ Gogo Baby, Inc. ” to “ Alpha Investment Inc. ” to better reflect our new business plan.   The name change and a corresponding change in the Company’s OTC markets trading symbol from GGBY to ALPC received approval from FINRA and became effective as of April 19, 2017.


On September 5, 2017, Alpha consummated the sale of 56,667 “ restricted ” Shares to a single accredited investor for $850,000 or $15.00 per Share in a transaction exempt from the registration requirements of the Securities Act of 1933, as amended (the “ Securities Act ”) pursuant to Section 4(a)(2) thereof and Regulation D thereunder. (the “ $850,000 Private Offering ”). No commissions or placement fees were paid in connection with the offer and sale of the Shares . The proceeds from the offer and sale of the Shares in the $850,000 Offering are being used for working capital and other general corporate purposes.




6




On September 20, 2017, we consummated the sale of 166,667 “ restricted ” Shares to a single accredited investor for $2,500,000 or $15.00 per Share in a transaction exempt from the registration requirements of the Securities Act pursuant to Section 4(a)(2) thereof and Regulation D thereunder (the “ $2,500,000 Private Offering ”). No commissions or placement fees were paid in connection with the offer and sale of the Shares.


At closing, the proceeds were deposited in the escrow account of the purchaser’s counsel (the “ Escrow Agent ”). If at any time prior to October 25, 2017 (the “Release Date” ), the opening bid price of our Shares on the over-the-counter market as reported by OTC Markets Group is less than $15.00 per Share (a “Share Price Trigger” ), the purchaser shall have the option, exercisable for a period of sixty (60) days after the Release Date (the “Notice Period” ) by written notice to the Company and the Escrow Agent (the “Repurchase Notice” ), to require the Company to repurchase the Shares for the purchase price paid.  In addition, and notwithstanding the foregoing, if a $30 million preferred debt financing, for the benefit of an entity acceptable to the purchaser in the purchaser’s reasonable discretion (an “Approved Financing” ), is not approved, closed, and funded prior to the Release Date, the purchaser shall have the option to deliver a Repurchase Notice to the Company and to the Escrow Agent.


If and when released from escrow, the proceeds of the $2,500,000 Private Offering will be used to provide lending capital for the Company’s newly implemented business line of credit services.


The Shares issued in the $850,000 Private Offering and the $2,500,000 Private Offering are registered hereunder for resale by the respective selling stockholders.


The Company is an “ emerging growth company ” under the Jobs Act and as such, may elect to comply with certain reduced public company reporting requirements for future filings.


Corporate Information


Our executive offices are located at 200 East Campus View Blvd., Suite 200, Columbus, OH and our telephone number is (305) 704-3294. Our website is www.alphainc.us .  Information contained in our website shall not be deemed incorporated into this prospectus.




7




The Offering


Issuer:

Alpha Investment Inc., a Delaware corporation

 

 

Shares offered by us in the Direct Offering:

A maximum of 33,333,333 Shares

 

 

Shares offered by the selling stockholders:

1,217,534 Shares

 

 

Shares to be outstanding immediately after the Direct Offering:

A maximum of 73,731,667 Shares (1)

 

 

Offering Price:

$15.00 per Share

 

 

Total Direct Offering:

A maximum of $500,000,000

 

 

Plan of Distribution:

The Shares in the Direct Offering are being offered and sold in a direct public offering on a “ self-underwritten, best efforts ” basis, which means (a) no minimum number of Shares need be subscribed for in order for the Company to consummate the sale of any of the Shares and utilize the proceeds therefrom; and (b) the Company will not use the services of an underwriter and our executive officers and directors will attempt to sell the Shares directly to investors.  The intended methods of communication with potential investors include, without limitation, telephone and personal contacts. The Company’s executive officers and directors may also reach out to personal contacts such as family, friends and acquaintances and may conduct investment presentations in the form of a roadshow at various industry and investor conferences. Subscription proceeds for Shares sold in the Direct Offering will be paid directly to the Company and will not be held in a segregated or escrow account. Our executive officers and directors will not receive commissions or any other remuneration from any such sales.


In offering Shares in the Direct Offering on the Company's behalf, our executive officers and directors will rely on the “ safe harbor ” provisions of SEC Rule 3a4-1, promulgated under the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”). Generally speaking, Rule 3a4-1 provides an exemption from the broker-dealer registration requirements of the Exchange Act for persons associated with an issuer that participate in the sale of the securities of such issuer.


The Shares in the Direct Offering will be offered for sale for a period of one hundred and eighty (180) days from the date of this prospectus, unless extended by our board of directors for period or periods of up to an aggregate of an additional one hundred and eighty (180) days.


The selling stockholders will offer their respective Shares at a fixed offering price of $15.00 per Share until a liquid market develops on OTCPink or any other tier of tier of the over-the counter market operated by OTC Markets Group or any other national securities exchange.  There can be assurance given that any active public market for our Shares will be established and be maintained We have agreed to bear the expenses relating to the registration of the selling stockholders’ Shares.

 

 

Dividend policy:

We have never paid cash dividends on our common stock and we do not anticipate paying any cash dividends in the foreseeable future. See “ Dividend Policy .”

 

 

(1)

Assumes all 33,333,333 Shares being offered in the Direct Offering are sold.  Does not include and 625,000 Shares reserved for issuance under our 2017 Stock Incentive Plan (the “ Incentive Plan ”).



8





Use of Proceeds:

We estimate that the proceeds from the Direct Offering, net of expenses, will approximate $499,580,476, if all the Shares offered in the Direct Offering are sold. We intend to use the net proceeds from the sale of the Shares in the direct Offering to support core business operations in the commercial real estate lending and asset backed financing sectors, strategic acquisition of cash flowing real estate companies and or real estate holdings, as well as to expand administrative and support staff, as needed and for working capital and other general corporate purposes.


We will not receive any proceeds from the sale of Shares being offered by the selling stockholder.

 

 

Risk Factors:

You should carefully read and consider the information set forth under the caption “ Risk Factors ” beginning on page 10 and all other information set forth in this prospectus before investing in our Shares.

 

 

OTCPink Symbol:

ALPC



SUMMARY FINANCIAL INFORMATION


The following summary financial data should be read in conjunction with “ Management’s Discussion and Analysis of Financial Condition and Results of Operations ,” and the Financial Statements and Notes thereto, included elsewhere in this prospectus.


Statement of Operations

For the Six

Months Ended

June 30,

 

For the Year

Ended

December 31,

 

2017

 

2016

 

(unaudited)

 

 

 

 

 

 

 

 

 

Revenues

$

12,000 

 

$

General & Administrative Expenses

$

35,886 

 

$

17,608 

Net Income (Loss)

$

(23,886)

 

$

(19,309)


Balance Sheet Data

As of

June 30,

 

As of

December 31,

 

2017

 

2016

 

(unaudited)

 

 

 

 

 

 

 

 

 

Cash

$

 

$

382 

Total Assets

$

 

$

382 

 

 

 

 

 

 

Current Liabilities

$

1,640 

 

$

19,729 

Long Term Liabilities

$

 

$

38,622 

Total Liabilities

$

1,640 

 

$

58,351 

 

 

 

 

 

 

Total Stockholders’ Deficit

$

(1,640)

 

$

(57,969)

Total Liabilities & Stockholders’ Deficit

$

 

$

382 






9





RISK FACTORS


An investment in our Shares involves a high degree of risk. You should carefully consider the risks described below, together with all of the other information included in this prospectus, including information in the section of this prospectus entitled “ Special Note Regarding Forward-Looking Statements .”  The risks and uncertainties described below are not the only ones facing us.  Additional risks and uncertainties not presently known to us or that we currently believe are immaterial may also impair our business operations. If any of the following risks actually occur, our business, financial condition or results of operations could be materially adversely affected, the value of our common stock could decline, and you may lose all or part of your investment.


Risks Related to Our Business


We have a limited operating history upon which an evaluation of our prospects can be made.


Alpha Investment was incorporated on February 22, 2013 under the name GoGo Baby, Inc. to develop, create, manufacture and market, toys for small children which would be designed to attach to car seats and amuse and entertain children during a drive, without distracting the attention of the driver.  The Company, however, encountered significant constraints in raising sufficient capital to fully implement such business plan.  The Company only shifted its business focus to commercial estate and other asset-based lending activities upon completion of the Control Share Acquisition on March 17, 2017.  To date, he Company has realized only minimal revenues therefrom and has no operating history in its present line of business upon which an evaluation of our future prospects can be made. Based upon current plans, we expect to incur operating losses in future periods as we incur expenses associated with the implementation of our new business plan.  Further, we cannot guarantee that we will be successful in realizing revenues from our new line of business or in achieving or sustaining positive cash flow at any time in the future. Any such failure could result in the possible closure of our business or force us to seek additional capital through loans or additional sales of our equity securities to continue business operations, which would dilute the value of any Shares you purchase.


We have a history of losses, our accountants expressed doubts about our ability to continue as a going concern and we require additional capital to execute our business plan.


As of the date of this prospectus, we have not yet achieved profitable operations.  We have accumulated losses, a working capital deficiency and we expect to incur further losses in the implementation of our current business plan, all of which, according to our accountants, casts substantial doubt about our ability to continue as a going concern. We will require additional funds through the receipt of conventional sources of capital or through future sales of our Shares, until such time as our revenues are sufficient to meet our cost structure, and ultimately achieve profitable operations. These actions will result in dilution of the ownership interests of existing stockholders and may further dilute our book value, and that dilution may be material.


We may use the proceeds of the Direct Offering to pay for our expenses even if our business is terminated and this means you may lose your entire investment.


Any funds raised in from the Direct Offering may be used immediately for our incurred expenses, even if we are later unable to fully implement our business plan. If this occurs, you may not receive your entire investment back because either we have used it to pay for offering costs or we have decided to liquidate and we are required to pay for other debts and liabilities. You may lose your entire investment.


ALPC, as a company, has limited experience in commercial lending and accordingly, will be dependent in significant part on its principal stockholder, Omega and its affiliates to generate loans through their correspondent platforms.


ALPC, as a company, has limited experience in commercial lending and accordingly, will be dependent in significant part on it principal stockholder, Omega and its affiliates to generate loans through their correspondent platforms.  If Omega and its affiliates are not able to do so, if their business is harmed for any reason or if there is an adverse development in the relationship between Alpha Investment and these affiliated lenders, our business, results of operations, financial condition and prospects may be seriously harmed.


Any loans we make, whether through our affiliated lenders’ correspondent platforms or directly, may be highly illiquid therefore we may not be able to liquidate such investments in a timely manner.


Any loans we make, whether through our affiliated lenders’ correspondent platforms or directly, may be highly illiquid with no established market, and there can be no assurance that we will be able to liquidate such investments in a timely manner.  Although loans and other investments we seek to make may generate current income, the return of capital and the realization of gains, if any, from such investments generally will occur only upon the partial or complete realization or disposition of such loan or investment.




10




Loans made by us may become uncollectible and large amounts of uncollectible debt may materially affect our performance.


The loans made by may be highly illiquid and involve substantial risks.  Many, and possibly all, of the loans will not be personally guaranteed. We will attempt to use information to help eliminate uncollectible debt resulting from bankruptcy, but no assurance can be made that we will be able to do so. If our debt portfolio contains a large portion of uncollectible debt, our performance may be negatively affected. In addition, if any borrower defaults on a loan, we may be required to expend monies in connection with foreclosure proceedings and other remedial actions which could adversely affect our performance. Certain loans may be affected negatively by economic, political, interest rate and other risks, any of which could result in an adverse change in the value of the asset that is used as collateral for the loan.


We intend to use leverage as part of our investment strategy which may substantially increase our risk of loss.


We have anticipated that certain loans will be originated or purchased using leverage available to us, thus increasing both net returns as well as risk.  Although the use of leverage as part of our investment strategy may enhance returns and increase the number of investments that can be made, it may also substantially increase our risk of loss.


Our investment strategy is dependent upon servicers to originate and administer loans; failure of our or our affiliated lenders’ servicers to originate loans in sufficient quantity and quality may cause us to fail to effectively implement our investment strategy.


We will be largely dependent upon servicers (i.e., third-party firms that specialize in loan origination and servicing) to originate and administer loans in our portfolio. Should our and our affiliated lenders’ servicers fail to originate the loans in sufficient quantity and quality, we will be unable to effectively implement our investment strategy. Should such servicers fail to properly administer and service loans, including monitoring borrower’s compliance with the terms of the relevant loan documents, collecting and forwarding loan payments to us, and adequately pursuing and protecting our rights under the loan documents, any such failure could have a material adverse effect on us and our investment operations. In addition, should any servicer default on its guaranty, if any, of a borrower’s obligation to repay a loan, such default could significantly harm our business, results of operations, financial condition and prospects.


In addition to servicers, we and our affiliated lenders may retain mortgage brokers to introduce loans to us that satisfy our investment criteria, and pay commissions to such mortgage brokers based on the value of such loans. Some of these mortgage brokers may be deemed to be affiliates of management. We believe that all commissions payable to such persons or other affiliates of management will be reasonable and consistent with industry standards.


We may appraise loans at a value that is materially different from the value ultimately realized.


We intend to make and value loans, in part, on the basis of information and data gathered from independent appraisal professionals. Although we expect to evaluate all such information and data and may seek independent corroboration when appropriate and reasonably available, we are not in a position to confirm the completeness, genuineness or accuracy of such information and data, and in some cases, complete and accurate information may not be available. It is possible that the appraised value of a loan may differ materially from the actual value ultimately realized by us with respect to such loan.


Our loan portfolio may be concentrated which could lead to increased risk.


It is possible that the portfolio of loans we make or any loan portfolio we may acquire will likely be concentrated in a limited number of loan investments.  Thus, our stockholders may have limited diversification.  In addition, if we make an investment in a single transaction with the intent of refinancing or selling a portion of the investment, there is a risk that we will be unable to successfully complete such a financing or sale. This could lead to increased risk as a result of having an unintended long term investment and reduced diversification.


We intend to make collateralized real estate loans which will subject us to various risks associated with the real estate industry.


We intend to make loans collateralized by real estate. Therefore, an investment in us may be subject to certain risks associated with the real estate industry in general. These risks include, without limitation: possible declines in the value of real estate; risks related to general and local economic conditions; possible lack of availability of mortgage funds; overbuilding; extended vacancies of properties; increases in competition, property taxes and operating expenses; changes in zoning laws; costs resulting from the clean-up of, and liability to third parties for damages resulting from, environmental problems; casualty or condemnation losses; uninsured damages from floods, earthquakes or other natural disasters; limitations on and variations in rents; and changes in interest rates. To the extent that our investments, or the assets of underlying or collateralizing our investments, are concentrated geographically, by property type or in certain other respects, we may be subject to the foregoing risks to a greater extent.




11




If third parties default or enter bankruptcy, we could suffer losses.


We may engage in transactions in securities and financial instruments that involve counterparties. Under certain conditions, we could suffer losses if counterparty to a transaction were to default or if the market for certain securities and/or financial instruments were to become illiquid. In addition, we could suffer losses if there were a default or bankruptcy by certain other third parties, including brokerage firms and banks with which we do business, or to which securities have been entrusted for custodial purposes.


We may make loans or purchase investments in foreign countries which may lead to additional risks not inherent to domestic lending.


We may make loans or purchase investments in foreign countries, some of which may prove to be unstable. As with any investment in a foreign country, there exists the risk of adverse political developments, including nationalization, acts of war or terrorism, and confiscation without fair compensation. Furthermore, any fluctuation in currency exchange rates will affect the value of investments in foreign securities or other assets and any restrictions imposed to prevent capital flight may make it difficult or impossible to exchange or repatriate foreign currency. In addition, laws and regulations of foreign countries may impose restrictions or approvals that would not exist in the United States and may require financing and structuring alternatives that differ significantly from those customarily used in the United States. Foreign countries also may impose taxes on us. We will analyze risks in the applicable foreign countries before making such investments, but no assurance can be given that a political or economic climate, or particular legal or regulatory risks, might not adversely affect our investments.


We currently rely on our executive officers and the loss of either of their services could have an adverse effect on the Company.


Until we further build up our management infrastructure, our success depends in large part upon the services of our officers, Todd C. Buxton, our CEO and Timothy R. Fussell, Ph.D., our President.  The loss of either of their services would currently have a material adverse effect on Alpha Investment.  We are not party to an employment agreement with our either of our executive officers and do not anticipate having key man insurance in place on them in the foreseeable future. Moreover, our CEO also serves as CEO of Omega.  While we do not believe that such position will materially interfere with his duties at Alpha Investment or pose any conflict of interest, there can be no assurance given in this regard.


If we are unable to attract and retain additional personnel in the commercial lending field, our ability to compete will be harmed.


Attracting and retaining qualified personnel in the commercial lending field will be critical to our success, and competition for qualified personnel is intense. We may not be able to attract and retain such personnel on acceptable terms given the competition for such personnel.  The inability to attract and retain qualified personnel could harm our business and our ability to compete.


We will face significant competition and if we are unable to effectively compete, our business, results of operations, financial condition and prospects may be seriously harmed.


The commercial lending field is highly competitive and we will face significant competition from other lenders, including banks, insurance companies and other lenders, many of which have significantly longer operating histories and financial resources than does Alpha Investment.  We believe that we will be able to effectively compete based on our ability to leverage on the industry experience, platforms and resources of Omega and its affiliates, in order to expedite and facilitate our ability to underwrite and structure complex financing transactions and enable Alpha Investment to develop and implement customized creative capital solutions for other lenders, mortgage bankers, borrowers, and owners.  However, there can be no assurance given that we can successfully do so and if we are unable to effectively compete, our business, results of operations, financial condition and prospects may be seriously harmed.





12




Risks Related to Our Status as a Public Company


We are and will continue to be subject to the periodic reporting requirements of the Exchange Act that require us to incur audit fees and legal fees in connection with the preparation of such reports.  These additional costs could reduce or eliminate our ability to earn a profit.


We are, and following the effective date of the registration statement of which this prospectus is a part, will be required to file periodic reports with the SEC pursuant to the Exchange Act and the rules and regulations promulgated thereunder.  In order to comply with these requirements, our independent registered public accounting firm is required to review our financial statements on a quarterly basis and audit our financial statements on an annual basis.  Moreover, our legal counsel has to review and assist in the preparation of such reports.  The future costs charged by these professionals for such services cannot be accurately predicted at this time because factors such as the number and type of transactions that we engage in and the complexity of our reports cannot be determined at this time and will have a major effect on the amount of time to be spent by our auditors and attorneys.  However, the incurrence of such costs will obviously be an expense to our operations and thus have a negative effect on our ability to meet our overhead requirements and earn a profit.  If we cannot provide reliable financial reports or prevent fraud, our business and operating results could be harmed, investors could lose confidence in our reported financial information, and the trading price of our Shares, if a market ever develops, could drop significantly.


Our internal controls may be inadequate, which could cause our financial reporting to be unreliable and lead to misinformation being disseminated to the public.


Our management is responsible for establishing and maintaining adequate internal control over financial reporting.  As defined in Rule 13a-15(f) under the Exchange Act, internal control over financial reporting is a process designed by, or under the supervision of, the principal executive and principal financial officer and effected by the board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that:


pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the Company;


provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and/or directors of the Company; and


provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements.


We will be required to include a report of management on the effectiveness of our internal control over financial reporting.  We expect to incur additional expenses and diversion of management’s time as a result of performing the system and process evaluation, testing and remediation required in order to comply with the management certification requirements.


We do not have a sufficient number of employees to segregate responsibilities and may be unable to afford increasing our staff or engaging outside consultants or professionals to overcome our lack of employees.  During the course of our testing, we may identify other deficiencies that we may not be able to timely remediate.  Moreover, effective internal controls, particularly those related to revenue recognition, are necessary for us to produce reliable financial reports and are important to help prevent financial fraud.  If we cannot provide reliable financial reports or prevent fraud, our business and operating results could be harmed, investors could lose confidence in our reported financial information, and the trading price of our common stock, if a market ever develops, could drop significantly.


The Jobs Act has reduced the information that the Company is required to disclose.


Under the Jobs Act, the information that the Company will be required to disclose has been reduced in a number of ways.




13




As a company that had gross revenues of less than $1 billion during the Company’s last fiscal year, the Company is an “ emerging growth company ,” as defined in the Jobs Act (an “ EGC ”). The Company will retain that status until the earliest of (a) the last day of the fiscal year which the Company has total annual gross revenues of $1,000,000,000 (as indexed for inflation in the manner set forth in the Jobs Act) or more; (b) the last day of the fiscal year of following the fifth anniversary of the date of the first sale of the common stock pursuant to an effective registration statement under the Securities Act; (c) the date on which the Company has, during the previous three year period, issued more than $1,000,000,000 in non-convertible debt; or (d) the date on which the Company is deemed to be a “ large accelerated filer ,” as defined in Rule 12b-2 under the Exchange Act or any successor thereto. As an EGC, the Company is relieved from the following:  


The Company is excluded from Section 404(b) of Sarbanes-Oxley Act ( Sarbanes-Oxley ), which otherwise would have required the Company s auditors to attest to and report on the Company s internal control over financial reporting. The Jobs Act also amended Section 103(a)(3) of Sarbanes-Oxley to provide that (i) any new rules that may be adopted by the PCAOB requiring mandatory audit firm rotation or changes to the auditor’s report to include auditor discussion and analysis (each of which is currently under consideration by the PCAOB) shall not apply to an audit of an EGC; and (ii) any other future rules adopted by the PCAOB will not apply to the Company’s audits unless the SEC determines otherwise.


The Jobs Act amended Section 7(a) of the Securities Act to provide that the Company need not present more than two years of audited financial statements in an initial public offering registration statement and in any other registration statement, need not present selected financial data pursuant to Item 301 of Regulation S-K for any period prior to the earliest audited period presented in connection with such initial public offering. In addition, the Company is not required to comply with any new or revised financial accounting standard until such date as a private company (i.e., a company that is not an “ issuer ” as defined by Section 2(a) of Sarbanes-Oxley) is required to comply with such new or revised accounting standard. Corresponding changes have been made to the Exchange Act, which relates to periodic reporting requirements, which would be applicable if the Company were required to comply with them.


As long as the Company is an EGC, the Company may comply with Item 402 of Regulation S-K, which requires extensive quantitative and qualitative disclosure regarding executive compensation, by disclosing the more limited information required of a smaller reporting company .


In the event that the Company registers its common stock under the Exchange Act as it intends to do, the Jobs Act will also exempt the Company from the following additional compensation-related disclosure provisions that were imposed on U.S. public companies pursuant to the Dodd-Frank Act: (i) the advisory vote on executive compensation required by Section 14A(a) of the Exchange Act; (ii) the requirements of Section 14A(b) of the Exchange Act relating to shareholder advisory votes on “ golden parachute ” compensation; (iii) the requirements of Section 14(i) of the Exchange Act as to disclosure relating to the relationship between executive compensation and our financial performance; and (iv) the requirement of Section 953(b)(1)of the Dodd-Frank Act, which requires disclosure as to the relationship between the compensation of the Company’s chief executive officer and median employee pay.


Our status as an “emerging growth company” under the Jobs Act may make it more difficult to raise capital as and when we need it.


Because of the exemptions from various reporting requirements provided to us as an “ emerging growth company ” and because we will have an extended transition period for complying with new or revised financial accounting standards, we may be less attractive to investors and it may be difficult for us to raise additional capital as and when we need it.  Investors may be unable to compare our business with other companies in our industry if they believe that our financial accounting is not as transparent as other companies in our industry.  If we are unable to raise additional capital as and when we need it, our business, results or operations, financial condition and prospects may be materially and adversely affected.


Risks Related to Our Shares and this Offering


You will experience immediate and substantial dilution as a result of this Direct Offering and may experience additional dilution in the future.


If you purchase Shares in the Direct Offering, you will incur immediate and substantial dilution of $8.18 per Share, representing the difference between the assumed initial public offering price of $15.00 per Share and our pro forma net tangible book value per Share after giving effect to consummation of the Direct Offering, assuming all the Shares offered hereby in the Direct Offering are sold.




14




We do not expect to pay cash dividends in the foreseeable future.


We have never paid cash dividends on our common stock.  We do not expect to pay cash dividends on our common stock at any time in the foreseeable future.  The future payment of dividends directly depends upon our future earnings, capital requirements, financial requirements and other factors that our board of directors will consider.  Since we do not anticipate paying cash dividends on our common stock, return on your investment, if any, will depend solely on an increase, if any, in the market value of our common stock.


The future issuance of equity or of debt securities that are convertible into equity will dilute our Share capital.


We may choose to raise additional capital in the future, depending on market conditions, strategic considerations and operational requirements. To the extent that additional capital is raised through the issuance of Shares or other securities convertible into Shares, our stockholders will be diluted. Future issuances of our common stock or other equity securities, or the perception that such sales may occur, could adversely affect the trading price of our common stock and impair our ability to raise capital through future offerings of Shares or equity securities. No prediction can be made as to the effect, if any, that future sales of common stock or the availability of common stock for future sales will have on the trading price of our common stock.


The ability of Omega, our principal stockholder, to effectively control our business may limit or eliminate minority stockholders’ ability to influence corporate affairs.


Omega, our principal stockholder, will own, assuming the sale of all 33,333,333 Shares offered in the Direct Offering, approximately 48.3% of our issued and outstanding common stock. Accordingly, they will be able to effectively control the election of directors, as well as all other matters requiring stockholder approval.  The interests of Omega may differ from the interests of other stockholders with respect to the issuance of Shares, business transactions with other companies, selection of other directors and other business decisions.  The minority stockholders have no way of overriding decisions made by Omega.  This level of control may also have an adverse impact on the market value of our Shares because Omega may institute or undertake transactions, policies or programs that result in losses may not take any steps to increase our visibility in the financial community and / or may sell sufficient numbers of Shares to significantly decrease our price per Share.


Our Certificate of Incorporation and Bylaws provide for indemnification of officers and directors at our expense and limit their liability that may result in a major cost to us and hurt the interests of our stockholders because corporate resources may be expended for the benefit of officers and/or directors.


Our Certificate of Incorporation and Bylaws provide for the indemnification of our officers and directors.  We have been advised that, in the opinion of the SEC, indemnification for liabilities arising under federal securities laws is against public policy as expressed in the Securities Act of 1933, as amended (the “Securities Act”) and is therefore, unenforceable.


The offering price of the Shares and the other terms of the Direct Offering have been arbitrarily determined by the Company.


The offering price of the Shares and other terms of the Direct Offering have been arbitrarily determined by the Company and bear no relationship to the Company’s assets, book value, potential earnings or any other recognized criterion of value. In addition, no investment banker, appraiser, or other independent third party has been consulted concerning the offering price for the Shares or the fairness of the offering price used for the Shares.


The Shares in the Direct Offering are being offered and sold on a “self-underwritten, best efforts” basis.


The Shares in the Direct Offering are being offered and sold in a direct public offering on a “ self-underwritten, best efforts ” basis, which means (a) no minimum number of Shares need be subscribed for in order for the Company to consummate the sale of any of the Shares and utilize the proceeds therefrom; and (b) the Company will not use the services of an underwriter and our executive officers and directors will attempt to sell the Shares directly to investors.  Subscription proceeds for Shares sold in the Direct Offering will be paid directly to the Company and will not be held in a segregated or escrow account. Moreover, the Direct Offering is self-underwritten and accordingly, there is no lead underwriter who would undertake a due diligence or comparable examination of the Company, its business and affairs.




15




Because our management will have broad discretion over the use of the net proceeds from the sale of Shares in the Direct Offering, you may not agree with how we use them and the proceeds may not be invested successfully.


We intend to use the net proceeds from the sale of the Shares in the direct Offering to support core business operations in the commercial real estate lending and asset backed financing sectors, strategic acquisition of cash flowing real estate companies and or real estate holdings, as well as to expand administrative and support staff, as needed and for working capital and other general corporate purposes. Therefore, our management will have broad discretion as to the use of the net proceeds from the Direct Offering. Accordingly, you will be relying on the judgment of our management with regard to the use of these net proceeds, and you will not have the opportunity, as part of your investment decision, to assess whether the such proceeds are being used appropriately. It is possible that the proceeds will be invested in a way that does not yield a favorable, or any, return for the Company.


A liquid trading market for our Shares may not develop and be sustained.


Our Shares are quoted on the OTCPink tier of the over-the counter market operated by OTC Markets Group under the symbol “ ALPC .” However, the market for our Shares has been extremely limited and there have only been mimimal and sporadic public quotations for our Shares.  A liquid trading market for our Shares may never develop or be sustained following the Direct Offering. If a liquid market for our common stock does not develop, or if developed, is not sustained, it may be difficult for you to sell Shares you purchase in the Direct Offering without depressing the market price for the Shares or at all.  In addition, quotation of our securities on the OTCPink may limit the liquidity and price of our securities more than if our securities were quoted or listed on the OTCQB tier of the over-the-counter market, the Nasdaq Stock Market or other national securities exchange. Further, institutional and other investors may have investment guidelines that restrict or prohibit investing in securities traded on the OTCPink. These factors may have an adverse impact on the trading and price of our common stock, if a liquid market develops and is sustained.


The market price for our common stock, assuming a liquid trading market develops and is sustained, may be particularly volatile given our status as a relatively unknown company with a small and thinly traded public float, limited operating history and lack of profits which could lead to wide fluctuations in our Share price. You may be unable to sell your Shares at or above your purchase price, which may result in substantial losses to you.


The market for our common stock, assuming a liquid trading market develops and is sustained may be characterized by significant price volatility when compared to seasoned issuers, and we expect that our Share price will continue to be more volatile than a seasoned issuer for the indefinite future.  The volatility in our Share price is attributable to a number of factors. First, as noted above, our common stock is sporadically and thinly traded. As a consequence of this lack of liquidity, the trading of relatively small quantities of Shares by our stockholders may disproportionately influence the price of those Shares in either direction. The price for our Shares could, for example, decline precipitously in the event that a large number of our common stock are sold on the market without commensurate demand, as compared to a seasoned issuer which could better absorb those sales without adverse impact on its share price. Secondly, we are a speculative or “ risky ” investment due to our limited operating history and lack of profits to date, and uncertainty of future market acceptance for our potential products and services.  As a consequence of this enhanced risk, more risk-adverse investors may, under the fear of losing all or most of their investment in the event of negative news or lack of progress, be more inclined to sell their Shares on the market more quickly and at greater discounts than would be the case with the stock of a seasoned issuer.  Many of these factors are beyond our control and may decrease the market price of our common stock, regardless of our operating performance.  We cannot make any predictions or projections as to what the prevailing market price for our common stock will be at any time, including as to whether our common stock will sustain their current market prices, or as to what effect that the sale of Shares or the availability of common stock for sale at any time will have on the prevailing market price.


If securities or industry analysts do not publish research or reports about our business, or if they issue an adverse or misleading opinion regarding our stock, our stock price and trading volume could decline.


The trading market for our common stock, assuming a liquid market develops and is sustained, will be influenced by the research and reports that industry or securities analysts publish about us or our business. We do not currently have and may never obtain research coverage by securities and industry analysts. If no or few securities or industry analysts commence coverage of us, the trading price for our Shares would be negatively impacted. In the event we obtain securities or industry analyst coverage, if any of the analysts who cover us issue an adverse or misleading opinion regarding us, our business model, our intellectual property or our stock performance, or if our target studies and operating results fail to meet the expectations of analysts, our stock price would likely decline. If one or more of these analysts cease coverage of us or fail to publish reports on us regularly, we could lose visibility in the financial markets, which in turn could cause our stock price or trading volume to decline.





16





SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

 

This prospectus contains forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. The SEC encourages companies to disclose forward-looking information so that investors can better understand a company’s future prospects and make informed investment decisions. This prospectus and other written and oral statements that we make from time to time contain such forward-looking statements that set out anticipated results based on management’s plans and assumptions regarding future events or performance. We have tried, wherever possible, to identify such statements by using terminology such as “ may, ” “ could, ” “ will ,” “ would ,” “ should ,” “ expect ,” “ plan ,” “ anticipate ,” “ believe ,” “ estimate ,” “ intend ,” “ predic t,” “ seek ,” “ contemplate ,” “ project ,” “ continue ,” “ potential ,” “ ongoing ” or the negative of these terms or other comparable terminology. These statements relate to future events or to our future financial performance and involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements. Factors that may cause actual results to differ materially from current expectations include, among other things, those described in the section titled “ Risk Factors ” and elsewhere in this prospectus.

 

Any forward-looking statement in this prospectus reflects our current view with respect to future events and is subject to these and other risks, uncertainties and assumptions relating to our operations, results of operations, industry and future growth. Given these uncertainties, you should not place undue reliance on these forward-looking statements. Except as required by law, we assume no obligation to update or revise these forward-looking statements for any reason, even if new information becomes available in the future.




17





USE OF PROCEEDS


The Shares in the Direct Offering are being offered and sold in a direct public offering on a “ self-underwritten, best efforts ” basis, which means (a) no minimum number of Shares need be subscribed for in order for the Company to consummate the sale of any of the Shares and utilize the proceeds therefrom; and (b) the Company will not use the services of an underwriter and our executive officers and directors will attempt to sell the Shares directly to investors.  Subscription proceeds for Shares sold in the Direct Offering will be paid directly to the Company and will not be held in a segregated or escrow account.


We estimate that the net proceeds from the Direct Offering will be approximately $499,580,476 if all 33,333,333 Shares offered hereby are purchased, after deducting estimated expenses of $414,524 of the Direct Offering. We expect to use the net proceeds from the Direct Offering over the next twelve (12) months for the purposes set forth in the table below. The following table sets forth a breakdown of the estimated use of the net proceeds as of the date of this prospectus, assuming the sale of 100%, 75%, 50% and 25% of the Shares offered in the Direct Offering:


Assumed Percentage of Shares Sold

 

100%

 

 

75%

 

 

50%

 

 

25%

Price to Public @ $15.00

$

499,580,476

 

$

374,685,357

 

$

249,790,238

 

$

124,895,119

Offering expenses

 

499,995

 

 

374,996

 

 

249,997

 

 

124,998

Net proceeds

$

499,080,481

 

$

374,310,360

 

$

249,540,240

 

$

124,770,120

 

 

 

 

 

 

 

 

 

 

 

 

Lending operations that encompasses commercial real estate mortgage financing and asset backed loan financing

$

492,086,768

 

$

369,065,076

 

$

246,043,384

 

$

123,021,692

Acquisitions of income-producing core assets and/or other non-core related assets or income producing core asset

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expansion of administrative operations and support staff

 

4,995,804

 

 

3,746,853

 

 

2,497,384

 

 

1,248,692

Working capital and other general corporate purposes

 

2,497,902

 

 

1,873,426

 

 

1,248,951

 

 

624,475

Total application of net proceeds

$

499,080,481

 

$

374,310,360

 

$

249,540,240

 

$

124,770,120


The expected use of the net proceeds from this Offering represents our intentions based upon our current plans and business conditions, which could change in the future as our plans and business conditions evolve. The amounts and timing of our actual expenditures depend on numerous factors, including lending and acquisition opportunities which arise, as well as the state of the markets we plan to operate in.  Accordingly, we will have broad discretion in the use of the net proceeds from the Direct Offering and could spend the proceeds in ways that do not improve our results of operations or enhance the value of our Shares.


Pending the application  of the proceeds from the Direct Offering, we intend to invest the net proceeds in short-term, interest-bearing, investment-grade securities, certificates of deposit or government securities.


In the event we do not sell all of the Shares being offered in the Direct Offering, we may seek additional financing to support the intended use of proceeds discussed above. If we secure additional equity funding, investors in the Direct Offering would be diluted. In all events, there can be no assurance that additional financing would be available when needed and, if available, on terms acceptable to us.


We will not receive any of the net proceeds from the sale of Shares in by the selling stockholders pursuant to this prospectus.




18





CAPITALIZATION


The following table sets forth our cash and cash equivalents and capitalization as of June 30, 2017:


·

on an actual basis; and


·

on a pro forma as adjusted basis to reflect the offer and sale of (a) 223,334 Shares in the $850,000 Private Offering and the $2,500,000 Offering and (b) all 33,333,333 Shares offered by us in the Direct Offering at an initial public offering price of $15.00 per Share, after deducting estimated expenses of the Direct Offering payable by us.


You should read this table in conjunction with our financial statements and related notes and the sections titled “ Use of Proceeds ,” “ Management’s Discussion and Analysis of Financial Condition and Results of Operations ,” and “ Description of Capital Stock ” appearing elsewhere in this prospectus.


 

As of June 30, 2017

 

Actual

 

Pro forma

As Adjusted

Stockholders' Equity (Deficit):

 

 

 

 

 

Preferred Stock ($0.0001 par value, 20,000,000 shares authorized; zero shares issued and outstanding as of June 30, 2017 and pro forma as adjusted

$

 

$

Common Stock, ($0.0001 par value, 100,000,000 shares authorized; and 40,175,000 and 73,731,667 Shares issued and outstanding as of June 30, 2017 and pro forma as adjusted

 

4,018 

 

 

7,373 

Additional paid-in capital

 

80,703 

 

 

502,162,823 

Deficit accumulated

 

(86,360)

 

 

(86,360)

Total Stockholders' Equity (Deficit)

$

(1,640)

 

$

502,083,836 


The number of Shares issued and outstanding actual and pro forma as adjusted in the table above excludes an additional 625,000 Shares reserved for issuance under the Incentive Stock Plan.


DILUTION


If you invest in our Shares in the Direct Offering, your interest will be diluted to the extent of the difference between the public offering price per Share that you pay and the pro forma as adjusted net tangible book value per Share stock after the Direct Offering. Net tangible book value per Share is determined by dividing our total tangible assets less our total liabilities by the number of Shares outstanding. Our historical net tangible book value as of June 30, 2017 was $(1,640) or $(0.000041) per Share, based on 40,175,000 Shares outstanding as of June 30, 2017.


Net tangible book value dilution per Share represents the difference between the amount per Share paid by new investors who purchase Shares from us in the Direct Offering and the pro forma net tangible book value per Share outstanding immediately after completion of the Direct Offering. As of June 30, 2017, after giving pro forma effect to our offer and sale of (a) 223,334 Shares in the $850,000 Private Offering and the $2,500,000 Offering and (b) all 33,333,333 Shares offered by us in the Direct Offering at an initial public offering price of $15.00 per Share, after deducting estimated expenses of $414,524 of the Direct Offering payable by us, our pro forma as adjusted net tangible book value would have been $502,083,836 or $6.81 per Share. This represents an immediate increase in pro forma net tangible book value of $6.81 per Share to existing stockholders, and an immediate dilution in pro forma net tangible book value of $8.19 per Share to new investors purchasing Shares in the Direct Offering. The table below illustrates this per Share dilution as of June 30, 2017.


Initial public offering price per Share

$

15.00  

Net tangible book value per Share as of June 30, 2017

$

(0.000041) 

Increase in pro forma net tangible book value per Share attributable to new investors participating in the Direct Offering

$

6.81  

Pro forma as adjusted net tangible book value per share after the Direct Offering

$

6.81  

Dilution of pro forma net tangible book value per share to new investors

$

8.19  

Percentage of dilution of pro forma net tangible book value per share to new investors

 

54.53%





19




The following table sets forth, on a pro forma as adjusted basis as of June 30, 2017, the number of Shares purchased or to be purchased from us, the total consideration paid or to be paid and the average price per Share paid or to be paid by existing holders of common stock and by new investors, at a public offering price of $15.00 per Share, before deducting estimated expenses of the Direct Offering Payable by us.


 

 

SHARES PURCHASED

 

 

TOTAL CONSIDERATION

 

 

AVERAGE PRICE

 

 

NUMBER

 

PERCENT

 

 

AMOUNT

 

PERCENT

 

 

PER SHARE

Existing stockholders

 

40,175,000

 

54

%

 

$

84,721

 

.01

%

 

$

.002

New investors

 

33,556,334

 

46

%

 

 

503,345,010

 

99.9

%

 

 

15.00

Total

 

73,731,334

 

100

%

 

$

503,429,731

 

100

%

 

$

14.98


The foregoing discussion and tables are based on the number of Shares outstanding as of June 30, 2017, giving pro forma effect to after giving pro forma effect to our offer and sale of 223,334 Shares in the $850,000 Private Offering and the $2,500,000 Offering, but excluding 625,000 Shares reserved for issuance under our Incentive Plan.







20





SELLING STOCKHOLDERS


This prospectus covers the resale from time to time by the selling stockholders identified in the table below of up to an aggregate 1,217,000 Shares, of which (a) 994, 300 were offered and sold in our initial public offering and subsequently acquired by the 33 Capital Street LLC; (b) 56,6627 Shares offered and sold to Dr. Assia Benhacene in the $850,000 Private Offering; and (c) 166,667 Shares offered and sold to Hoosier Real Estate Investors, LLC in the $2,500,000 Offering.


We are registering the Shares to permit the selling stockholder and any of their respective pledgees, donees, transferees, assignees and successors-in-interest to, from time to time, sell any or all of its Shares on any stock exchange, market or trading facility on which the Shares are traded or in private transactions when and as they deem appropriate in the manner described below.


Except as described hereinThere are no agreements between the Company and any of the selling stockholders pursuant to which the Shares subject to this registration statement were issued.  Neither Dr. Benhacene or Hoosier Real Estate Investors, LLC has had a material relationship with the Company within the past three years.  Erika L. Hasty, the managing member of 33 Capital Street LLC functions as an independent loan origination consultant to the Company


The following table sets forth, as of the date of this prospectus, the name of each selling stockholder, the number and percentage of Shares beneficially owned by such selling stockholder as of to the date of this prospectus, the number of Shares registered for resale hereunder and the number and percentage of Shares beneficially owned by the selling stockholder after the resale offering of the Shares (without giving effect to the offer and sale of Shares in the Direct Offering).  Beneficial ownership is determined in accordance with the rules of the SEC, and includes any Shares to which the selling stockholder has sole or shared voting power or investment power and any Shares which the selling stockholder has the right to acquire within sixty (60) days of the date of this prospectus through the exercise of any option, warrant or right, through conversion of any security or pursuant to the automatic termination of a power of attorney or revocation of a trust, discretionary account or similar arrangement.


Name of Selling Stockholder

 

Total Shares

Owned by

Selling

Stockholder

**

 

 

Total Shares to

be Registered

Pursuant to this

Offering

 

Percentage of

Common Stock

Before

Offering **

 

Number of Shares

Owned by Selling

Stockholder After

Offering

 

 

Percentage of

Common Stock

After Offering

**

 

 

 

 

 

 

 

 

 

 

 

 

 

33 Capital Street LLC (1)

 

2,244,200

(1)

 

994,200

 

5.6%

 

1,250,000

(1)

 

3.1%

Dr. Assia Benhacene

 

56,667

 

 

56,667

 

(2)

 

0

 

 

0

Hoosier Real Estate Investors, LLC (3)

 

166,667

 

 

166,667

 

(2)

 

0

 

 

0


** Based on 43,398,334 Shares outstanding as of the date of this prospectus.

(1)

Erika L. Hasty is the managing member of the selling stockholder and exercises voting and dispositive control over these Shares.  Ms. Hasty was awarded a grant of 1,250,000 “ restricted ” Shares under our Incentive Plan, which are included herein.

(2)

Less than 1.0%.

(3)

Thomas C. Guthrie is the manager of the selling stockholder and exercises voting and dispositive control over these Shares,


The selling stockholders and any of their respective pledgees, donees, transferees, assignees and successors-in-interest may, from time to time, sell any or all of their Shares on any stock exchange, market or trading facility on which the shares are traded or in private transactions. Our Shares are quoted on the OTCPink tier of the over-the counter market operated by OTC Markets Group, Inc. “ ALPC .”  However, the market for our Shares has been extremely limited and there have only been minimal and sporadic public quotations for our Shares.  Given the foregoing, the selling stockholders will offer their Shares at a fixed offering price of $15.00 per Share until a liquid market develops on OTCPink or any other tier of tier of the over-the counter market operated by OTC Markets Group or any other national securities exchange.  There can be assurance given that any liquid public market for our Shares will develop and be sustained.


Assuming an active trading market develops and is sustained, thereafter the Shares may be sold at fixed or negotiated prices.  The selling stockholders may use any one or more of the following methods when selling Shares:


·

ordinary brokerage transactions and transactions in which the broker-dealer solicits investors;


·

block trades in which the broker-dealer will attempt to sell the Shares as agent but may position and resell a portion of the block as principal to facilitate the transaction;




21




·

purchases by a broker-dealer as principal and resale by the broker-dealer for its account;


·

an exchange distribution in accordance with the rules of the applicable exchange;


·

privately negotiated transactions;


·

to cover short sales made after the date that this registration statement is declared effective by the SEC;


·

broker-dealers may agree with the selling stockholders to sell a specified number of such Shares at a stipulated price per share;


·

through the distribution of Shares by a selling stockholder to which is a limited liability company to its members;


·

any other method permitted pursuant to applicable law; and


·

a combination of any such methods of sale.


Broker-dealers engaged by a selling stockholder may arrange for broker-dealers to participate in sales.  Broker-dealers may receive commissions or discounts from the selling stockholder (or, if any broker-dealer acts as agent for the purchaser of Shares, from the purchaser) in amounts to be negotiated.  The selling stockholders do not expect these commissions and discounts to exceed what is customary in the types of transactions involved.


A selling stockholder may from time to time pledge or grant a security interest in some or all of the Shares owned by such selling stockholder and, if the selling stockholder defaults in the performance of such secured obligations, the pledgees or secured parties may offer and sell the Shares from time to time under this prospectus, or under an amendment to this prospectus under Rule 424(b)(3) or other applicable provision of the Securities Act amending the list of selling stockholders to include the pledgee, transferee or other successors in interest as selling stockholders under this prospectus.


Upon a selling stockholder’s notification to us that any material arrangement has been entered into with a broker-dealer for the sale of the selling stockholder’s Shares through a block trade, special offering, exchange distribution or secondary distribution or a purchase by a broker or dealer, a supplement to this prospectus will be filed, if required, pursuant to Rule 424(b) under the Securities Act disclosing (a) the names of the selling stockholder and the participating broker-dealer(s); (b) the number of Shares involved; (c) the price at which such Shares were sold; (d) the commissions paid or discounts or concessions allowed to such broker-dealer(s), where applicable; (e) that such broker-dealer(s) did not conduct any investigation to verify the information set out or incorporated by reference in this prospectus;, and (f) other facts material to the transaction. In addition, upon our being notified in writing by the selling stockholder that a donee or pledgee intends to sell more than 500 Shares, a supplement to this prospectus will be filed if then required in accordance with applicable securities law.


A selling stockholder also may transfer Shares in other circumstances, in which case the donees, assignees, transferees, pledgees or other successors in interest will be the selling beneficial owners for purposes of this prospectus and may sell the Shares from time to time under this prospectus after we have filed any necessary supplements to this prospectus under Rule 424(b), or other applicable provisions of the Securities Act supplementing or amending the list of selling stockholders to include such donee, assignee, transferee, pledgee, or other successor-in-interest as a selling stockholder under this prospectus.


In the event that a selling stockholder is deemed to be an “ underwriter ,” any broker-dealers or agents that are involved in selling the Shares will be deemed to be “ underwriters ” within the meaning of the Securities Act, in connection with such sales.  In such event, any commissions received by such broker-dealers or agents and any profit on the resale of the Shares purchased by them may be deemed to be underwriting commissions or discounts under the Securities Act.  Discounts, concessions, commissions and similar selling expenses, if any, that can be attributed to the sale of the Shares of will be paid by such selling stockholder and/or the purchasers.


If the selling stockholders use this prospectus for any sale of Shares, they will be subject to the prospectus delivery requirements of the Securities Act.  The selling stockholders will be responsible to comply with the applicable provisions of the Securities Act and the Exchange Act and the rules and regulations thereunder promulgated, including, without limitation, Regulation M, as applicable to the selling stockholders in connection with resales of the Shares under this registration statement.


 We are required to pay all fees and expenses incident to the registration of the Shares for resale by the selling stockholders, but we will not receive any proceeds from the sale of such Shares.



22





MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS


Our Shares are quoted on the OTC Pink tier of the over-the counter market operated by OTC Markets Group, Inc. under the symbol “ALPC.” However, the trading market for our Shares has been extremely limited and there have only been minimal and sporadic public quotations for our Shares.  On October 24, 2017, the most recent date for which a quotation for our Shares is available, the closing sale price for our common stock on OTC Pink was $0.75 per Share as reported by OTC Markets Group.  We anticipate applying for quotation of our Shares on the OTCQX or the OTCQB tiers of the over-the-counter market operated by OTC Markets Group or listing of out Shares on a national securities exchange following the effectiveness of the registration statement of which this prospectus forms a par, and subject to completion of the Direct Offering. However, we cannot assure you that our Shares will be quoted on any tier of OTC Markets Group or listed on any national securities exchange or, if quoted or listed, that a liquid market will develop and if developed, be sustained.


As of the date of this prospectus, we had 43,398,334 Shares issued and outstanding and 38 holders of record of our common stock.


Transfer Agent


Signature Stock Transfer Inc., at 14673 Midway Road, Suite #220 Addison, Texas 75001, is the transfer agent for the Company’s common stock.


Dividend Policy


We have not paid any dividends on our common stock since inception and we currently expect that, in the foreseeable future, all earnings (if any) will be retained for the development of our business and no dividends will be declared or paid. Any future dividends will be subject to the discretion of our board of directors and will depend upon, among other things, our earnings (if any), operating results, financial condition and capital requirements, general business conditions and other pertinent facts.





23




PROPOSED BUSINESS


Overview


We intend to provide capital directly to affiliated lenders to fund loans through their correspondent platforms and funding to small businesses in the commercial real estate and other asset-backed markets.  We also intend to acquire and manage performing commercial first mortgage loans, subordinate financings, commercial mortgage-backed securities and other commercial real estate-related debt investments, as well as engage in various direct participation equity ownership opportunities.  We expect to offer financing platforms across a broad-spectrum of asset types at all points within an asset’s capital structure.  Alpha Investment plans to leverage on the industry experience, platforms and resources of its principal stockholder, Omega Commercial Finance Corp, a publicly-held Wyoming corporation (“ Omega ”) and Omega’s affiliates, in order to expedite and facilitate ALPC’s ability to underwrite and structure complex financing transactions and enable the Company to develop and implement customized creative capital solutions for other lenders, mortgage bankers, borrowers, and owners.


Alpha’s capital resources have been limited to date, which has restricted its business activities to organizational matters, as well as planning implementation of its proposed business.  Alpha’s ability to implement that plan will be subject to raising significant capital, primarily from the proceeds of the Direct Offering.


Corporate History


We were incorporated in the State of Delaware on February 22, 2013, to develop, create, manufacture and market, toys for small children which would be designed to attach to car seats and amuse and entertain children during a drive, without distracting the attention of the driver.  The Company, however, encountered significant constraints in raising sufficient capital to fully implement its business plan.


On March 17, 2017, Omega purchased all 35,550,000 outstanding “ restricted ” shares of the Company’s common stock in the Control Share Sale from Malcolm Hargrave (35,000,000 shares), DTH International Corporation (500,000 shares) and Lisa Foster (50,000 shares) for aggregate consideration of $295,000.  The Control Share Sale was consummated in a private transaction pursuant to a common stock purchase agreement entered between Omega and Mr. Hargrave, acting individually and on behalf of the other selling stockholders.  Upon completion of the Control Share Sale, a “ Change in Control” of the Company took place and in connection therewith, Mr. Hargrave resigned as our sole director and officer and Omega, as the new majority stockholder of the Company, elected Timothy R. Fussell, Ph.D. as President, Chairman of the Board and a director and Todd C. Buxton, Omega’s Chief Executive Officer, as Chief Executive Officer, Vice Chairman of the Board and a director.


In addition to the foregoing, new management elected to focus the shift in the Company’s business focus to real estate and other commercial lending, which they believed offered better opportunities for shareholder growth.  In connection therewith, on March 30, 2017, we filed a Certificate of Amendment to our Certificate of Incorporation with the Delaware Secretary of State changing our name from “ Gogo Baby, Inc. ” to “ Alpha Investment Inc. ” to better reflect our new business plan.   The name change and a corresponding change in the Company’s OTC markets trading symbol from GGBY to ALPC received approval from FINRA and became effective as of April 19, 2017.


Plan of Operations


Our core objective will be to achieve advantageous yields and consistent interest income on short and medium term loans (“ Loans ”) by:


furnishing capital to our affiliated lenders to make Loans through their correspondent platforms primarily to borrowers such as commercial real estate developers and speculators, business owners, landlords and owners of core assets when traditional financing is unavailable to such borrowers for acquisitions, refinancing of commercial property loans and other asset backed transactions; and


making Loans directly to small businesses in the commercial real estate and other asset-backed markets.


Either directly or in conjunction with our affiliated lenders, we plan to consult on various financing programs with an emphasis on Loans secured by commercial real estate, including office buildings, multi-family residences, shopping centers, industrial, and hotels, as well as asset backed Loans secured by account receivables from established companies. Loans may consist of senior debt loans, mezzanine or subordinated loans, preferred equity and other equity participation financing structures, and in the case of specialty financing, for the factoring of receivables secured by a Uniform Commercial Code security interest.




24




We intend to follow a “ conservative lending ” profile for the Loans we fund.  Our strategy is to seek low leveraged first lien senior debt mortgage loans and high debt service structured financing programs, as opposed to riskier, less secure, mezzanine or equity positions.


Many times when a company decides to pursue new opportunities, they find that the barriers of entry are often high or unattainable. Typically, this is due to a lack of capital and the proper advisory services and solutions necessary for these companies to achieve their business potential. We have determined to address that need by focusing our business efforts primarily for the purpose of underwriting or investing in Loans and/or specialty financing programs backed or secured by real estate or other types of related assets or equity interests.


Regardless of the type of Loan, our focus is will be earning rates of return that exceed the commensurate level of risk associated with each Loan and specialty financing program. We plan to use our and our affiliated lender’s third-party relationships with seasoned providers to independently assess the value, volatility, and adequacy of the collateral for each Loan we fund, whether through our affiliated lenders or directly, to assure that all Loans made are appropriately collateralized. As part of our assurance procedures, a third party independent asset loan manager will assess the ease of repossessing and disposing of collateral for each loan. We also will ensure that underlying Loans will be adequately insured.  We plan to use only third-party credit and risk assessment firms that utilize standard securitization underwriting protocols and criteria in the credit and risk assessment process, prior to final approval of any Loan.


The Company has the authority to provide our affiliated lenders with capital to or directly fund or invest in a wide variety of Loans, securities, and other real estate related investments, domestic or foreign, of all kinds and descriptions, whether publicly traded or privately placed, including but not limited to common and preferred stocks, bonds and other debt securities, direct ownership interests in real estate, interests in real estate investment funds, Loans of all kind (including the Loans herein), accounts receivable, notes, convertible securities, limited partnership interests, limited liability company interests, mutual fund shares, options, warrants, derivatives, currencies, monetary instruments and cash and cash equivalents. We will not trade in commodities or financial futures.


Business Objectives and Strategy


Our core business objective is to achieve advantageous and consistent rates of return from short and medium term Loans to borrowers when traditional financing is unavailable to such borrowers for acquisitions, refinancing of commercial property loans and other asset backed transactions. We plan to focus on various alternative commercial real estate financings with an emphasis on Loans secured by commercial real estate and also seek to invest in financing of core real estate assets that include office buildings, multi-family residences, shopping centers, and hospitality, plus ground up entitled land developments. The Loans may consist of senior debt loans, mezzanine or subordinated loans, preferred equity and other equity participation financing structures. We intend to follow a “ conservative lending ” profile for the Loans we fund, which means low loan to value and high debt service cover ratios. Our strategy is to seek Loans that are first lien, senior debt mortgage loans and specialty financing programs, as opposed to riskier, yet much more profitable, and less secure mezzanine or equity positions.


With respect to asset backed Loans, we plan to fund, either through our affiliated lenders or directly, accounts receivable based lines of credit better known as factoring. Factoring assists small to medium sized business owners in resolving their short term working capital needs. This service will be supported by a back office underwriting, due diligence, sales, marketing, servicing, training, and collections provider working either directly with us or with our affiliated lenders. We plan to utilize state of the art software that will allow us to facilitate and organize a seamless stream of completed transactions. Further, we plan to leverage our assets at a multiple of up to 6(x) times that will maximize our capital. We believe that this will position us to create capitalization models that offer us high yielding short term Loans as the result of the ability of this financing product to garner high returns and turnover of the deployed capital that is secured by receivables due from established companies such as a Wall Mart, GM and Best Buy,


Use of Loan Servicers


In carrying out our business strategy, we will likely utilize third-party firms that specialize in Loan origination and servicing (“ Servicers ”), either directly or through our affiliated lenders.  We intend to perform due diligence on each Servicer which we, directly or indirectly, plan use in the origination and servicing of Loans, in order to evaluate the firm’s experience and expertise in originating and servicing Loans that satisfy our lending and investment criteria.


Use of Other Third-Party Service Providers


We, either directly or through our affiliated lenders, will utilize other third parties to provide various ancillary services, such as such as evaluation and feasibility services, closing and escrow services and fund administration services.




25




Sale of Participations; Co-Investments and Participations


In the discretion of management, we may sell participation rights in the Loans we originate to other entities.


We may from time to time co-invest and or syndicate participation interest in loans as the administrative agent or buying a participation interest. We plan to only employ this strategy with seasoned well-established organizations in the CRE lending industry such as private trusts, real estate financing institutions, mutual funds, pension funds, investment houses, or hedge funds of fund.  We believe that this will afford the Company with an additional opportunity to participate in well-structured transactions with organizations with proven track records involving originating, underwriting, and servicing.


The Commercial Real Estate Lending Product


Operationally, management believes the market for commercial mortgage loans will offer opportunities for the deployment of capital we raise.  The commercial real estate (CRE) markets have suffered greatly in recent years beginning with the 2008 U.S. financial market crisis, which resulted in a steep and prolonged recession. However, as the lending markets have steadily recovered along with market leaders such as large banks Wells Fargo, JP Morgan Chase, Bank of America and Capital One, believe CRE lending landscape has now stabilized in select Centralized Business Districts known as “ CBD’s ” and afford extremely attractive opportunities for deploying capital. Thus, we will focus on positioning the Company to seize this opportunity within this market.  We believe that our proposed business model is comparable to that currently being used by some of the top-level commercial real estate lender industry professionals. However, to compete and succeed within this industry, we, in conjunction with our affiliated lenders and building on the work of leaders in this market sector, have vetted and designed what we believe to be proprietary pricing and lending model for the commercial real estate finance debt and equity market.  We believe that this lending model and strategic positioning will enable us, working together with our affiliated lenders, to successfully compete.


Key Operational Highlights – CRE Loans


·

The overall core property commercial real estate (“ CRE ”) lending market is vast and global pushing well above a trillion dollars so we believe there are significant business opportunities that will afford the Company continued growth.


·

We expect that our lending model will allow for smaller increments of loans designed for quicker closings to permit investors to monitor development of the ongoing balance sheet and enable us to more rapidly achieve milestones.


·

Trepp.com a CMBS research firm, estimates the current size of the CMBS loan market at approximately $680 billion with $10.0 billion of underlying mortgages maturing between now and 2018.


·

We plan to retain or use seasoned commercial real estate securitization in-house and independent specialists retained by our affiliated lenders to coordinate our loan underwriting model centered on mitigating loan-loss risks and to perform all other related and required third party due diligence.


·

Since the securitization industry has standardized the underwriting criteria, we anticipate that it will allow for each third - party service provider we use to integrate and exchange information effectively and efficiently.


·

We believe that we will have low cost and prudent leverage available to us to fund Loans originated or made either through our affiliated lenders or directly.


·

We intend to utilize our own internal industry knowledge as well as our affiliated lenders’ significant loan origination, structuring, and closing experience to serve our needs to generate revenues.


·

Our strategy has been developed with the input of experienced industry veterans.




26




The Commercial Real Estate Market Forecast


According to Trepp Inc, a leading commercial real estate research firm,  there was no ‘Mayday call’ signaled by the CMBS market in May, as a number of factors – namely a large chunk of resolved maturities, lower delinquency rate, and heightened volume of new issuance – led to a pleasant month. As we near the halfway point of 2017, the monthly volumes of maturing loans will gradually begin to shrink. However, June represents the largest monthly total for the rest of the year as nearly $10 billion in CMBS needs to be refinanced. Also based on a May 2017 snapshot, more than $266.6 billion in CMBS loans have been paid off in any manner since January 2015, including disposals with losses. Those disposed loans were written off with cumulative losses of more than $10.5 billion at an average loss in the 12-month period between June 2016 and May 2017, $122.5 billion in securitized mortgage debt was liquidated, 8.30% of which incurred losses at resolution.  Those loans that were disposed with losses were written down at an average severity of 41.65%.  Based on underwritten maturity dates for loans that were scheduled to pay off during this time frame, 12,346 loans totaling $32.58 billion are still outstanding. For the month of May, a little more than $7.8 billion in maturing CMBS loans were resolved.


Loan Production Relationships


Our affiliated lenders and we have strategically aligned ourselves with top commercial real estate mortgage bankers nationwide with the goal of utilizing their production networks.  We have focused on firms that have experienced loan origination back office staff to ensure our CRE Loan services will be appropriately and professionally being marketed. Also, management has a proprietary database of 50 to 100 mortgage bankers to market their CRE Loan products to and generate Loan production internally for consistent deal flow.  In addition, we believe that as our operations expand, we always have the opportunity to establish and retain an in-house sales team.


Key Operational Highlights – Asset-Backed Financing


Our asset-backed lending operations will be based on the premise that business does not always go as planned; therefore we will work with clients to get them realigned financially with viable solutions for optimum profitability. Key among the services provided through this division, is a line of factoring products.


Our main product will be advance factoring, which enables clients to turn accounts receivable into cash-on-hand with secured working capital loans. Accounts receivable, inventory or other assets such as real estate, equipment and intellectual property will secure the factoring division’s working capital Loans. Advance rates are determined based on analysis of appropriate metrics for each collateral class (e.g. accounts receivable dilution, assessed value of tangible assets).


Competition


A number of much larger proven commercial real estate lenders such as JP Morgan Chase, Bank of America, Goldman, Apollo Commercial Real Estate, and RAIT currently have established operations with large balance sheets and back office staff. However, we are a non-banking institution and are not regulated like the larger banks or typical CMBS lender in that we are not “pigeon holed” into immediately securitizing our assets. Rather we elect to use the standardized securitization underwriting characteristics to originate loans, consequently to mitigate liquidly-risk (i.e. recapitalization) with the ability to hold these loans on the un-tainted balance sheet in order to garner stable income to yield strong growth and market share.  However, as most of these lenders have far longer operating histories and significantly larger financial resources than we do, there can be no assurance given that we can effectively compete.


Employees


We currently have no employees other than our executive officers.  As noted above, we intend to rely on third parties retained by us and our affiliated lenders and third parties retained by them for services in areas such as loan origination and production, credit analysis, underwriting, due diligence, and loan servicing.  As our operations grow, we may elect to bring certain, if not all of these services in house.


Properties


Our principal executive offices are located at 200 East Campus View Blvd. Suite 200 Columbus, OH 43235, where we lease space from Omega, our principal stockholder, on a month to month basis at a monthly rent of $95.


Legal Proceedings


Currently there are no legal proceedings pending or threatened against us.  However, from time to time, we may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business.  Litigation is subject to inherent uncertainties, and an adverse result in any such matter may harm our business, results of operations, financial condition and business prospects.




27




MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS


We qualify as an “ emerging growth company ” under the JOBS Act. As a result, we are permitted to, and intend to, rely on exemptions from certain disclosure requirements. For so long as we are an emerging growth company, we will not be required to:


Ÿ

have an auditor report on our internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act;


Ÿ

comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis);


Ÿ

submit certain executive compensation matters to shareholder advisory votes, such as “ say-on-pay ” and “ say-on-frequency ;” and


Ÿ

disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the CEO’s compensation to median employee compensation.


In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage of the benefits of this extended transition period. Our financial statements may therefore not be comparable to those of companies that comply with such new or revised accounting standards.


We will remain an “ emerging growth company ” for up to five years, or until the earliest of (a) the last day of the first fiscal year in which our total annual gross revenues exceed $1 billion; (b) the date that we become a “large accelerated filer” as defined in Rule 12b-2 under the Securities Exchange Act, which would occur if the market value of our ordinary shares that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter or (c) the date on which we have issued more than $1.0 billion in non-convertible debt during the preceding three year period.


Going Concern


Our auditor has issued a going concern opinion as of June 30, 2017. This means that there is substantial doubt that we can continue as an on-going business for the next twelve months unless we obtain additional working capital to pay our bills.  Our cash balance on June 30, 2017 was $0.  As of this offering’s filing date, the Company raised additional funds subsequent to the $0 cash balance stated for June 30, 2017 through the $850,000 Private Offering and the $2,500,000 Private Offering, and as such we believe that we shall require additional capital to fund our planned lending programs, primarily through the Direct Offering. ( please reference “ Use of Proceeds” page 18 herein above ).


Results of Operations


Six months ended June 30, 2017 as compared to six months ended June 30, 2016


For the six months ended June 30, 2017 we generated $12,000 in revenues from our new line of business and had $35,886 in general and administrative expenses, consisting of $14,186 in administrative costs, $14,500 in stock compensation for consulting services and $7,200 in professional fees, resulting in a net loss of $23,886.


For the six months ended June 30, 2016 we generated no revenues and had $10,086 in general and administrative expenses, consisting of $4,086 in administrative costs and 6,000 in professional fees.  We recorded $754 in interest expense, resulting in a net loss of $10,840.


Year ended December 31, 2016 as compared to year ended December 31, 2015


For the year ended December 31, 2016 we generated no revenues and had $17,608 in general and administrative expenses, consisting of $7,608 in administrative costs and $10,000 in professional fees. We recorded $1,696 in interest expense and $5 in impairment loss, resulting in a net loss of $19,309.


For the year ended December 31, 2015 we generated no revenues and had $21,991 in general and administrative expenses, consisting of $11,491 in administrative costs and $10,500 in professional fees. We recorded $1,168 in interest expense, resulting in a net loss of $23,159.



28




Liquidity and Capital Resources


Prior to September 2017, our working capital was extremely limited, primarily generated from loans from affiliates.  In connection with the Control Share Sale, in on March 17, 2017, Malcolm Hargrave, our former sole director and executive officer signed an agreement to forgive all debt, including unpaid interest, amounting $ 55,715, due to him from the Company. This was classified as additional paid -in capital.


On March 29, 2017, Omega, the principal stockholder of the Company, made an additional capital contribution to the Company of $10,000. This was classified as additional paid-in capital.


Our cash balance at June 30, 2017 was $0.  Although we raised additional funds subsequent to such date through the $850,000 Private Offering and the $2,500,000 Private Offering, we believe that we will require substantial additional capital to fund our planned operations, primarily through the Direct Offering.


Critical Accounting Policies


Use of Estimates


The preparation of financial statements in conformity with accounting principles generally accepted in the United States 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 expenses during the reporting period.  Actual results could differ from those estimates.  Significant estimates included deferred revenue, costs incurred related to deferred revenue, the useful lives of property and equipment and the useful lives of intangible assets.


Income Taxes


The Company accounts for income taxes in accordance with ASC 740, Accounting for Income Taxes, as clarified by ASC 740-10, Accounting for Uncertainty in Income Taxes.  Under this method, deferred income taxes are determined based on the estimated future tax effects of differences between the financial statement and tax basis of assets and liabilities given the provisions of enacted tax laws.  Deferred income tax provisions and benefits are based on changes to the assets or liabilities from year to year.  In providing for deferred taxes, the Company considers tax regulations of the jurisdictions in which the Company operates, estimates of future taxable income, and available tax planning strategies.  If tax regulations, operating results or the ability to implement tax-planning strategies vary, adjustments to the carrying value of deferred tax assets and liabilities may be required.  Valuation allowances are recorded related to deferred tax assets based on the “more likely than not” criteria of ASC 740.


ASC 740-10 requires that the Company recognize the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit.  For tax positions meeting the “more-likely-than-not” threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority.


Off-Balance Sheet Arrangements


There are no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.




29





MANAGEMENT


Directors and Executive Officers


The following table sets forth the name, age and position of each person who is a director or executive officer as of the date of this prospectus.


Name

Age

Positions and Offices to be Held

 

 

 

Timothy R. Fussell, Ph.D.

53

President, Chairman and director

Todd C. Buxton

48

Chief Executive Officer, Vice Chairman and director


Both of our directors bring to our board of directors executive leadership experience derived from their prior business experience. Each of them has demonstrated strong business acumen and an ability to exercise sound judgment and has a reputation for integrity, honesty and adherence to ethical standards.  Set forth below is a brief description of the background and business experience of our directors and executive officers


Timothy R. Fussell, Ph.D. , has served as Omega’s Executive Vice President of Corporate Business Affairs since July 2016.  Dr. Fussell has over thirty years’ experience as a financial strategist, working with both individuals and entities in the financial planning, capital raising and merger and acquisition spheres.  In 2012, Dr. Fussell founded Partners South Estate Planning, Inc., a Florida-based financial and estate planning firm and has served as its President since that time, building it into a nationally recognized firm in its field.  Since 2006, Dr. Fussell has also served as President of Fussell Insurance and Benefits, LLC, a Florida licensed insurance brokerage which he founded as an adjunct to his financial planning business.  For over 20 years prior thereto, Dr. Fussell was a principal of T.R. Fussell, Inc., a North-Carolina-based financial and estate planning firm.


Todd C. Buxton, has served as Omega’s Chief Executive Officer since April 2015. Mr. Buxton carries out initiatives to significantly improve the company's strategic operational execution and integration of new and existing subsidiaries with a goal to accelerate profitability, shareholder value and growth for the company. This includes planning the overall strategic business direction and facilitating creative development business models for Omega specifically within the capacity of the Omega's M&A contractual negotiations and internal business contract facilitation for sales transactions, mergers and acquisitions, and capital markets growth strategies. Prior to serving as Omega ‘s Chief Executive Officer, from 2010 through 2015, Mr. Buxton served in the same capacity for Bentley-Addison Capital Finance, which directly brokered and advised companies as an intermediary for commercial real estate financing opportunities. Mr. Buxton has a strong foundation in the commercial real estate construction management industry and real estate developer/contracting business as well as the information technology field going back to 1992. Overall Mr. Buxton has an entrepreneurial spirit and had owned and directed various successful business ventures in the past.


Terms of Office


Our directors are appointed for a one-year term to hold office until the next annual meeting of our stockholders and until a successor is appointed and qualified, or until their removal, resignation, or death.  Executive officers serve at the pleasure of the board of directors.


Director Independence


At present, neither of our directors are “ independent ” as defined under Rule 10A-3(b)(1) under the Exchange Act.


Board Committees


Our board of directors does not currently have an audit committee, a compensation committee, or a corporate governance committee.  As we expand our board in the future to add “ independent ” directors, we may seek to establish such committees, all the members of which will be “ independent ” directors.


Code of Ethics


We have adopted a Code of Ethics that applies to employees, including our principal executive officer, principal financial officer, or persons performing similar functions.




30




Board of Directors Role in Risk Oversight


Members of the board of directors have periodic meetings with management and the Company’s independent auditors to perform risk oversight with respect to the Company’s internal control processes. The Company believes that the board’s role in risk oversight does not materially affect the leadership structure of the Company .


EXECUTIVE COMENSATION


Summary Compensation Table


The table below summarizes all compensation awarded to, earned by or paid to Malcom Hargrave, who was our sole executive officer for 2016 and 2015 and who resigned from such positions upon consummation of the Control Share Sale on March 17, 2017.


SUMMARY COMPENSATION TABLE


Name and

principal position

 

Year

 

Salary

($)

 

Bonus

($)

 

Stock

Awards

(#)

 

Option

Awards

(#)

 

Non-Equity

Incentive Plan

Compensation

($)

 

Nonqualified

Deferred

Compensation

Earnings

($)

 

All Other

Compensation

($)

 

Total

($)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Malcom Hopkins,

 

2016

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

President, CEO and CFO

 

2015

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0


Employment Agreements


The Company is presently not party to an employment agreement with either of its executive officers.


Outstanding Equity Awards at Fiscal Year-End Table


The table below summarizes all unexercised options, stock that has not vested, and equity incentive plan awards outstanding as of December 31, 2016 for Malcom Hargrave, who was our sole executive officer until his resignation upon completion of the Control Share Sale on March 17, 2017.


OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END


 

 

OPTION AWARDS

 

STOCK AWARDS

Name

 

Number of

Securities

Underlying

Unexercised

Options

(#)

Exercisable

 

Number of

Securities

Underlying

Unexercised

Options

(#)

Unexercisable

 

Equity

Incentive

Plan

Awards:

Number of

Securities

Underlying

Unexercised

Unearned

Options

(#)

 

Option

Exercise

Price

($)

 

Option

Expiration

Date

 

Number of

Shares or

Shares of

Stock That

Have Not

Vested

(#)

 

Market

Value of

Shares or

Shares of

Stock That

Have Not

Vested

($)

 

Equity

Incentive

Plan Awards:

Number of

Unearned

Shares, Shares

or Other Rights

That Have Not

Vested

(#)

 

Equity

Incentive

Plan Awards:

Market or

Payout Value

of Unearned

Shares,

Shares or

Other Rights

That Have

Not Vested

(#)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Malcom Hargrave

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0





31




Compensation of Directors Table


The table below summarizes all compensation paid for our last completed fiscal year to Malcom Hargrave, who was our sole director, until his resignation upon completion of the Control Share Sale on March 17, 2017.


DIRECTOR COMPENSATION


Name

 

Fees Earned

or

Paid in Cash

($)

 

Stock

Awards

($)

 

Option

Awards

($)

 

Non-Equity

Incentive

Plan

Compensation

($)

 

Non-Qualified

Deferred

Compensation

Earnings

($)

 

All Other

Compensation

($)

 

Total

($)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Malcolm Hargrave

 

0

 

0

 

0

 

0

 

0

 

0

 

0


Narrative Disclosure to the Director Compensation Table


We currently do not compensate our directors for their services as such. When we expand our board to include “ independent ” directors we intend to implement a plan and compensate them with a combination of cash and stock option awards, depending on our financial resources at that time.


Incentive Plan


Our Incentive Plan provides for equity incentives to be granted to our employees, executive officers or directors or to key advisers or consultants.  Equity incentives may be in the form of stock options with an exercise price not less than the fair market value of the underlying Shares as determined pursuant to the Incentive Plan, restricted stock awards, other stock based awards, or any combination of the foregoing.  The Incentive Plan is administered by the board of directors.  5,000,000 Shares are reserved for issuance pursuant to the exercise of awards under the Incentive Plan.  The number of shares so reserved automatically adjusts upward on January 1 of each year, so that the number of shares covered by the  Incentive Plan is equal to 15% of our issued and outstanding common stock. As of the date of this prospectus, we have granted restricted stock awards of 4,375,000 Shares to six consultants.





32





PRINCIPAL STOCKHOLDERS


The following table sets forth, as of the date of this prospectus, the beneficial ownership of our common stock by each director and executive officer, by each person known by us to beneficially own 5% or more of our common stock and by directors and executive officers as a group.  Unless otherwise stated, the address of the persons set forth in the table is c/o the Company, 200 East Campus View Blvd., Suite 200, Columbus, OH 43235.


Names and addresses

 

Number of shares of

 

 

Percentage of class

of

 

common stock

 

 

beneficially owned (%)

beneficial owners

 

beneficially owned (#)

 

 

Before Offering

 

After Offering (1)

 

 

 

 

 

 

 

 

Directors and executive officers:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Timothy R. Fussell, Ph.D.

 

0

(2)

 

0.0

 

0.0

Todd C. Buxton

 

0

(2)

 

0.0

 

0.0

All executive officers and directors as a group (two persons)

 

0

(2)

 

0.0

 

0.0

 

 

 

 

 

 

 

 

Other 5% percent beneficial owners:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Omega Commercial Finance Corp.

 

35,550,000

 

 

88.0

 

48.2

33Capital Street LLC

 

2,244,200

(3)

 

5.6

 

(4)


The persons named above have full voting and investment power with respect to the shares indicated.  Under the rules of the SEC, a person (or group of persons) is deemed to be a “ beneficial owner ” of a security if he or she, directly or indirectly, has or shares the power to vote or to direct the voting of such security, or the power to dispose of or to direct the disposition of such security.  Accordingly, more than one person may be deemed to be a beneficial owner of the same security.


(1)

Assumes the sale of all 33,333,333 Shares offered by the Company in the Direct Offering.

(2)

Does not include 35,550,000 Shares held by Omega.  The director and executive officer is also an executive officer of Omega, but does not have voting or dispositive control over such Shares and accordingly, disclaims beneficial ownership of those Shares.

(3)

Includes 1,250,000 “ restricted ” Shares awarded to Erika L. Hasty under our Incentive Plan. Erika L. Hasty is the managing member of 33 Capital Street LLC and exercises voting and dispositive control over the Shares held by 33 Capital Street LLC.

(4)

Less than 1%.


CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS


Related Party Transactions


In connection with the Control Share Sale, in on March 17, 2017, Malcolm Hargrave, our former sole director and executive officer signed an agreement to forgive all debt, including unpaid interest, amounting $ 55,715, due to him from the Company. This was classified as additional paid -in capital.


On March 29, 2017, Omega, the principal stockholder of the Company, made an additional capital contribution to the Company of $10,000. This was classified as additional paid-in capital.


Review, Approval and Ratification of Related Party Transactions


All related party transactions are subject to the review, approval or ratification of our board of directors or an appropriate committee thereof.



33





DESCRIPTION OF CAPITAL STOCK


Capital Stock


Our authorized capital stock consists of 105,000,000 shares of common stock, par value $0.0001 and 5,000,000 shares of preferred stock, par value $0.0001.


Common Stock


As of the date of this prospectus, 43,398,334 shares of common stock are issued as outstanding.  The shares of common stock presently outstanding are, and the Shares being offered and sold in the Direct Offering, when issued and paid for as contemplated herein, will be, fully paid and non-assessable.  Each holder of common stock is entitled to one vote for each share owned on all matters voted upon by shareholders, and a majority vote is required for all actions to be taken by shareholders.  In the event we liquidate, dissolve or wind-up our operations, the holders of the common stock are entitled to share equally and ratably in our assets, if any, remaining after the payment of all our debts and liabilities and the liquidation preference of any shares of preferred stock that may then be outstanding.  The common stock has no preemptive rights, no cumulative voting rights, and no redemption, sinking fund, or conversion provisions.


Holders of common stock are entitled to receive dividends, if and when declared by the board of directors, out of funds legally available for such purpose, subject to the dividend and liquidation rights of any preferred stock that may then be outstanding.


Preferred Stock


Our board of directors has the authority, without further action by the stockholders, to issue shares of preferred stock in one or more series and to fix the rights, preferences and the number of shares constituting any series or the designation of such series.  While our Certificate of Incorporation and bylaws do not contain any provisions that may delay, defer or prevent a change in control, the issuance of preferred stock may have the effect of delaying or preventing a change in control or make removal of our management more difficult. No shares of preferred stock are outstanding as of the date of this prospectus.


SHARES ELIGIBLE FOR FUTURE SALE


Commencing ninety (90) days after the date of this prospectus, all of the 41,750,000 shares of our common stock outstanding as of the date of this prospectus and not covered by this Registration Statement , will be eligible for sale in the public market from time to time thereafter pursuant to Rule 144 under the Securities Act, and in some cases, subject to the volume and other restrictions of Rule 144. The sale of a significant number of shares of our common stock in the public market or the perception that such sales may occur could significantly reduce the market price of our common stock.


Rule 144


In general, under Rule 144 under the Securities Act, beginning ninety (90) days after the effective date of the registration statement of which this prospectus is a part, a person (or persons whose shares are aggregated) who is not deemed to have been an affiliate of ours at any time during the three months preceding a sale, and who has beneficially owned restricted securities within the meaning of Rule 144 for at least six (6) months (including any period of consecutive ownership of preceding non-affiliated holders) would be entitled to sell those shares, subject only to the availability of current public information about us. A non-affiliated person who has beneficially owned restricted securities within the meaning of Rule 144 for at least one year would be entitled to sell those shares without regard to the provisions of Rule 144.


A person (or persons whose shares are aggregated) who is deemed to be an affiliate of ours and who has beneficially owned restricted securities within the meaning of Rule 144 for at least six (6) months would be entitled to sell within any three-month period a number of shares that does not exceed the greater of one percent of the then outstanding shares of our common stock or the average weekly trading volume of our common stock reported through Nasdaq or such other market on which our shares of common stock are listed for trading during the four calendar weeks preceding such sale. Such sales are also subject to certain manner of sale provisions, notice requirements and the availability of current public information about us.




34





PLAN OF DISTRIBUTION


Terms of the Direct Offering


The Shares in the Direct Offering are being offered and sold in a direct public offering on a “ self-underwritten, best efforts ” basis, which means (a) no minimum number of Shares need be subscribed for in order for the Company to consummate the sale of any of the Shares and utilize the proceeds therefrom; and (b) the Company will not use the services of an underwriter and our executive officers and directors will attempt to sell the Shares directly to investors.  The intended methods of communication with potential investors include, without limitation, telephone and personal contacts. The Company’s executive officers and directors may also reach out to personal contacts such as family, friends and acquaintances and may conduct investment presentations in the form of a roadshow at various industry and investor conferences. Subscription proceeds for Shares sold in the Direct Offering will be paid directly to the Company and will not be held in a segregated or escrow account. Our executive officers and directors will not receive commissions or any other remuneration from any such sales.


In offering the Shares in the Direct Offering on our behalf, our executive officers and directors will rely on the “ safe harbor ” provisions of SEC Rule 3a4-1, promulgated under the Exchange. Generally speaking, Rule 3a4-1 provides an exemption from the broker-dealer registration requirements of the Exchange Act for persons associated with an issuer that participate in the sale of the securities of such issuer.


Our executive officers and directors meet the conditions of the Rule 3a4-1 exemption, as: (a) they are not subject to any statutory disqualification, as that term is defined in Section 3(a)(39) of the Exchange Act; (b) they will not be compensated in connection with their participation in the direct public offering or resale offering by the payment of commissions or other remuneration based either directly or indirectly on transactions in our securities; and (c) they will not be associated persons of a broker or dealer at the time of their participation in the direct public offering and resale offering. Further, our officers and directors: (a) at the end of the offerings, will continue to primarily perform substantial duties for the Company or on its behalf otherwise than in connection with transactions in securities; (b) are not, nor have been within the preceding twelve (12) months, a broker or dealer, and they are not, nor have they been within the preceding twelve (12) months, an associated person of a broker or dealer; and (c) they have not participated in another offering of securities pursuant to the Exchange Act Rule 3a4-1 in the past twelve (12) months and they have not and will not participate in selling an offering of securities for any issuer more than once every twelve (12) months other than in reliance on the Exchange Act Rule 3a4-1(a)(4)(i) or (iii).


In order to comply with the applicable securities laws of certain states, the securities will be offered or sold in those states only if they have been registered or qualified for sale, an exemption from such registration is available, or if qualification requirement is available and with which the Company has complied. In addition, and without limiting the foregoing, the Company will be subject to applicable provisions, rules and regulations under the Exchange Act with regard to security transactions during the period of time when this Registration Statement is effective.


Offering Period and Expiration Date


The Shares in the Direct Offering will be offered for sale for a period of one hundred and eighty (180) days from the date of this prospectus, unless extended by our board of directors for period or periods of up to an aggregate of an additional one hundred and eighty (180) days.


Procedures for Subscribing


If you decide to subscribe for any shares in the Direct Offering, you must:


execute and deliver a Subscription Agreement; and


deliver the subscription price to the Company by cashier’s check or wire transfer of immediately available funds.


The Subscription Agreement requires you to disclose your name, address, social security number, telephone number, email address, number of Shares you are purchasing, and the price you are paying for your Shares.


Acceptance of Subscriptions


Upon the Company’s acceptance of a subscription and receipt of full payment, and subject to the timing qualification set forth above, the Company shall countersign the Subscription Agreement and issue a stock certificate along with a copy of the Subscription Agreement.




35




Right to Reject Subscriptions


We have the right to accept or reject subscriptions in whole or in part, for any reason or for no reason. All monies from rejected subscriptions will be returned immediately by us to the subscriber, without interest or deductions. Subscriptions for securities will be accepted or rejected within three (3) business days after we receive them.


LEGAL MATTERS


The validity of the common stock being offered hereby has been passed upon by Gutiérrez Bergman Boulris, PLLC, Coral Gables, Florida.


EXPERTS


The audited financial statements included in this prospectus and elsewhere in the registration have so been included in reliance upon the report of PLS CPA, a professional corp., independent registered public accountants, upon the authority of said firm as experts in accounting and auditing in giving said report.


WHERE YOU CAN FIND MORE INFORMATION


We have filed a registration statement on Form S-1 under the Securities Act with the SEC with respect to the Shares offered through this prospectus.  This prospectus is filed as a part of that registration statement, but does not contain all of the information contained in the registration statement and exhibits.  Statements made in the registration statement are summaries of the material terms of the referenced contracts, agreements or documents of the company.  We refer you to our registration statement and each exhibit attached to it for a more detailed description of matters involving the company.  You may inspect the registration statement, exhibits and schedules filed with the SEC at the SEC’s principal office in Washington, D.C.  Copies of all or any part of the registration statement may be obtained from the Public Reference Section of the SEC, 100 F Street, N.E. Washington, D.C. 20549.  Please Call the Commission at 1-800-SEC-0330 for further information on the operation of the public reference rooms.  The SEC also maintains a web site at http://www.sec.gov that contains reports, proxy Statements and information regarding registrants that files electronically with the SEC.  Our registration statement and the referenced exhibits can also be found on this site.


DISCLOSURE OF SEC POSITION ON INDEMNIFICATION

FOR SECURITIES ACT LIABILITIES


In accordance with the provisions in our Certificate of Incorporation, we will indemnify an officer, director, or former officer or director, to the full extent permitted by law.


Insofar as indemnification for liabilities arising under the Securities Act may be permitted to our directors, officers and controlling persons pursuant to the foregoing provisions, or otherwise, we have been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable.






36





ALPHA INVESTMENT INC.

INDEX TO FINANCIAL STATEMENTS


 

Page

Audited Financial Statements:

 

 

 

Report of Independent Registered Public Accounting Firm

F-2

Balance Sheets as of December 31, 2016 and 2015

F-3

Statements of Operations for the years ended December 31, 2016 and 2015

F-4

Statements of Changes in Equity for the years ended December 31, 2016 and 2015

F-5

Statements of Cash Flows for the years ended December 31, 2016 and 2015

F-6

Notes to Financial Statements

F-7


Unaudited Financial Statements:


Balance Sheets as of June 30, 2017 (unaudited) and December 31, 2016

F-14

Statements of Operations for the six months ended June 30, 2017 and 2016 (unaudited)

F-15

Statements of Cash Flows for the six months ended June 30, 2017 and 2016 (unaudited)

F-16

Notes to Financial Statements (unaudited)

F-17








F-1






PLS CPA, A PROFESSIONAL CORP.

t 4725 MERCURY STREET #210 t SAN DIEGO t CALIFORNIA 92111 t

t TELEPHONE (858)722-5953 t FAX (858) 761-0341  t FAX (858) 433-2979

t E-MAIL changgpark@gmail.com t




Report of Independent Registered Public Accounting Firm


To the Board of Directors and Stockholders

Gogo Baby, Inc.

 

We have audited the accompanying balance sheets of Gogo Baby, Inc. (the “Company”) as of December 31, 2016 and 2015, and the related statements of operations, changes in shareholders’ equity (deficit) and cash flows for the years ended December 31, 2016 and 2015. These financial statements are the responsibility of the Company’s management.  Our responsibility is to express an opinion on these financial statements based on our audits.


We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.  An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements.  An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statements presentation.  We believe that our audit provides a reasonable basis for our opinion.


In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Gogo Baby, Inc. as of December 31, 2016 and 2015, and the result of its operations and its cash flows for the years ended December 31, 2015 and 2014 in conformity with U.S. generally accepted accounting principles.


The financial statements have been prepared assuming that the Company will continue as a going concern.  As discussed in Note 6 to the financial statements, the Company’s losses from operations raise substantial doubt about its ability to continue as a going concern.  The financial statements do not include any adjustments that might result from the outcome of this uncertainty.




/s/ PLS CPA                                                                         

PLS CPA, A Professional Corp.


March 16, 2017

San Diego, CA. 92111







Registered with the Public Company Accounting Oversight Board






F-2






GoGo Baby, Inc.


Balance Sheets




 

 

As of

 

As of

 

 

December 31,

 

December 31,

 

 

2016

 

2015

ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

Current Assets

 

 

 

 

 

 

Cash

 

$

382 

 

$

416 

Total Current Assets

 

 

382 

 

 

416 

 

 

 

 

 

 

 

Other Assets

 

 

 

 

 

 

Intangible Assets, net

 

 

 

 

Total Other Assets

 

 

 

 

 

 

 

 

 

 

 

TOTAL ASSETS

 

$

382 

 

$

421 

 

 

 

 

 

 

 

LIABILITIES & STOCKHOLDERS' DEFICIT

 

 

 

 

 

 

 

 

 

 

 

 

 

Current Liabilities

 

 

 

 

 

 

Accounts payable

 

$

5,636 

 

$

5,562 

Promissory notes payable--long term notes due in one year

 

 

13,000 

 

 

15,000 

Accrued interest

 

 

1,093 

 

 

1,111 

Total Current Liabilities

 

 

19,729 

 

 

21,673 

 

 

 

 

 

 

 

Long-Term Liabilities

 

 

 

 

 

 

Accrued interest

 

 

2,122 

 

 

408 

Promissory note payable

 

 

36,500 

 

 

17,000 

Total Long-Term Liabilities

 

 

38,622 

 

 

17,408 

 

 

 

 

 

 

 

Total Liabilities

 

 

58,351 

 

 

39,081 

 

 

 

 

 

 

 

Stockholders' Deficit

 

 

 

 

 

 

Preferred Stock ($0.0001 par value, 20,000,000 shares authorized; zero shares issued and outstanding as of December 31, 2016 and December 31, 2015

 

 

 

 

Common stock, ($0.0001 par value, 100,000,000 shares authorized; 36,550,000 and 36,550,000 shares issued and outstanding as of December 31, 2016 and December 31, 2015

 

 

3,655 

 

 

3,655 

Additional paid-in capital

 

 

850 

 

 

850 

Deficit accumulated

 

 

(62,474)

 

 

(43,165)

Total Stockholders' Deficit

 

 

(57,969)

 

 

(38,660)

 

 

 

 

 

 

 

TOTAL LIABILITIES & STOCKHOLDERS' DEFICIT

 

$

382 

 

$

421 


The accompanying notes are an integral part of these financial statements




F-3





GoGo Baby, Inc.


Statements of Operations




 

 

Year

 

Year

 

 

Ended

 

Ended

 

 

December 31,

 

December 31,

 

 

2016

 

2015

Revenues

 

 

 

 

 

 

Revenues

 

$

 

$

Total Revenues

 

 

 

 

 

 

 

 

 

 

 

General & Administrative Expenses

 

 

 

 

 

 

Administrative expenses

 

 

7,608 

 

 

11,491 

Professional fees

 

 

10,000 

 

 

10,500 

Total General & Administrative Expenses

 

 

17,608 

 

 

21,991 

 

 

 

 

 

 

 

Loss from Operation

 

 

(17,608)

 

 

(21,991)

 

 

 

 

 

 

 

Other Expense

 

 

 

 

 

 

Impairment loss

 

 

 

 

Interest expense

 

 

1,696 

 

 

1,168 

Total Other Expenses

 

 

1,701 

 

 

1,168 

 

 

 

 

 

 

 

Net Income (Loss)

 

$

(19,309)

 

$

(23,159)

 

 

 

 

 

 

 

Basic earnings per share

 

$

(0.00)

 

$

(0.00)

 

 

 

 

 

 

 

Weighted average number of common shares outstanding

 

 

36,550,000 

 

 

36,550,000 


The accompanying notes are an integral part of these financial statements





F-4





GoGo Baby, Inc.

 

Statement of Changes in Shareholders' Equity (Deficit)

For the years from December 31, 2014 to ended December 31, 2016




 

 

 

 

 

 

 

Additional

 

 

 

 

 

 

 

 

Common Stock

 

Paid-in

 

Deficit

 

 

 

 

 

Shares

 

Amount

 

Capital

 

Accumulated

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance,  December 31, 2014

 

36,550,000

 

$

3,655

 

$

850

 

$

(20,006)

 

$

(15,501)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss for the period ending December 31, 2015

 

 

 

 

 

 

 

 

 

 

(23,159)

 

 

(23,159)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance, December 31, 2015

 

36,550,000

 

 

3,655

 

 

850

 

 

(43,165)

 

 

(38,660)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss for the period ending December 31, 2016

 

 

 

 

 

 

 

 

 

 

(19,309)

 

 

(19,309)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance, December 31, 2016

 

36,550,000

 

$

3,655

 

$

850

 

$

(62,474)

 

$

(57,969)


The accompanying notes are an integral part of these financial statements







F-5





GoGo Baby, Inc.


Statements of Cash Flows

(Audited)




 

 

Year

 

Year

 

 

Ended

 

Ended

 

 

December 31,

 

December 31,

 

 

2016

 

2015

 

 

 

 

 

 

 

CASH FLOWS FROM OPERATING ACTIVITIES

 

 

 

 

 

 

Net income (loss)

 

$

(19,309)

 

$

(23,159)

Adjustments to reconcile net loss to net cash provided by (used in) operating activities:

 

 

 

 

 

 

Impairment loss

 

 

 

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

Increase (Decrease) in accounts payable and accrued liabilities

 

 

74 

 

 

5,062 

Increase in accrued interest

 

 

1,696 

 

 

1,168 

Net cash provided by (used in) operating activities

 

 

(17,534)

 

 

(16,929)

 

 

 

 

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES

 

 

 

 

 

 

Acquisition of Intangible Assets

 

 

 

 

Net cash provided by (used in) investing activities

 

 

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES

 

 

 

 

 

 

Proceed from notes payable - related party

 

 

17,500 

 

 

13,000 

Net cash provided by (used in) financing activities

 

 

17,500 

 

 

13,000 

 

 

 

 

 

 

 

Net increase (decrease) in cash

 

 

(34)

 

 

(3,929)

Cash at beginning of period

 

 

416 

 

 

4,345 

Cash at end of period

 

$

382 

 

$

416 

 

 

 

 

 

 

 

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash paid during period for:

 

 

 

 

 

 

Interest

 

$

 

$

Income Taxes

 

$

 

$


The accompanying notes are an integral part of these financial statements





F-6





GoGo Baby, Inc.

 

Notes To Financial Statements

December 31, 2016




NOTE 1 – ORGANIZATION AND DESCRIPTION OF BUSINESS


GoGo Baby, Inc.  (the “Company”) was incorporated on February 22, 2013  under the laws of the State of Delaware to enter into the toy industry.  The GoGo Baby invention of a wireless car seat toy system was created with the objective to provide a car seat toy system that the driver can activate from the steering wheel.  It is Gogo Baby’s first objective to sell the patent to a major company or secondly have the toy manufactured, set up an online store and market the product.


The Company’s activities to date have been limited to organization and capital.  The Company’s fiscal year end is December 31.


NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES


Accounting Basis


The statements were prepared following generally accepted accounting principles of the United States of America consistently applied.


Use of Estimates


The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods presented.  The Company is required to make judgments and estimates about the effect of matters that are inherently uncertain.  The Company regularly evaluates estimates and assumptions related to the useful life and recoverability of long-lived assets, deferred income tax asset valuations and loss contingences.  The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources.  Although, we believe our judgments and estimates are appropriate, actual future results may be different; if different assumptions or conditions were to prevail, the results could be materially different from our reported results.


Cash and Cash Equivalents


Cash equivalents include short-term, highly liquid investments with maturities of three months or less at the time of acquisition.


Property and Equipment


Property and equipment are stated at cost.  Equipment and fixtures are being depreciated using the straight-line method over the estimated asset lives, 5 year.


Intangible Assets


Initial Measurement


Intangible asset acquisitions in which the consideration given is cash are measured by the amount of cash paid, which generally includes the transaction costs of the asset acquisition. However, if the consideration given is not in the form of cash (that is, in the form of noncash assets, liabilities incurred, or equity interests issued), measurement is based on either the cost which shall be measured based on the fair value of the consideration given or the fair value of the assets (or net assets) acquired, whichever is more clearly evident and, thus, more reliably measurable.





F-7




GoGo Baby, Inc.

 

Notes To Financial Statements

December 31, 2016




NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)


Subsequent Measurement


The company accounts for its intangible assets under the Financial Accounting Standards Board ("FASB") Accounting Standards Codification Subtopic ("ASC") 350-30-35 “Intangibles—Goodwill and Other—General Intangibles Other than Goodwill-Subsequent Measurement”. Under this method the company is required to test an indefinite-lived intangible asset for impairment on at least an annual basis. This is done by comparing the asset’s fair value with its carrying amount. If the carrying amount exceeds the asset’s fair value, the difference in those amounts is recognized as an impairment loss.


Income Taxes


The Company accounts for its income taxes in accordance with FASB Accounting Standards Codification (“ASC”) No. 740, "Income Taxes".  Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax balances.  Deferred tax assets and liabilities are measured using enacted or substantially enacted tax rates expected to apply to the taxable income in the years in which those differences are expected to be recovered or settled.  Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized.  The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the date of enactment or substantive enactment.


Financial Instruments


Fair value measurements are determined based on the assumptions that market participants would use in pricing an asset or liability.  ASC 820-10 establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. FASB ASC 820 establishes a fair value hierarchy that prioritizes the use of inputs used in valuation methodologies into the following three levels:


Ÿ

Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets. A quoted price in an active market provides the most reliable evidence of fair value and must be used to measure fair value whenever available.


Ÿ

Level 2: Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.


Ÿ

Level 3: Significant unobservable inputs that reflect a reporting entity’s own assumptions about the assumptions that market participants would use in pricing an asset or liability. For example, level 3 inputs would relate to forecasts of future earnings and cash flows used in a discounted future cash flows method.


The carrying amounts reported in the balance sheet for cash, accounts payable and notes payable approximate their estimated fair market value based on the short-term maturity of this instrument.


In addition, FASB ASC 825-10-25 “Fair Value Option” was effective for January 1, 2008. ASC 825-10-25 expands opportunities to use fair value measurements in financial reporting and permits entities to choose to measure many financial instruments and certain other items at fair value.




F-8





GoGo Baby, Inc.

 

Notes To Financial Statements

December 31, 2016




NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)


Net Loss Per Share


Basic loss per share includes no dilution and is computed by dividing loss available to common stockholders by the weighted average number of common shares outstanding for the period.  Dilutive loss per share reflects the potential dilution of securities that could share in the losses of the Company.  Because the Company does not have any potentially dilutive securities, the accompanying presentation is only of basic loss per share.


Recently Issued Accounting Pronouncements


Recent accounting pronouncements that the Company has adopted or that will be required to adopt in the future are summarized below.


In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2014-09 – Revenue From Contracts with Customers, which will supersede nearly all existing revenue recognition guidance under U.S. GAAP. The core principal of this ASU is that an entity should recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This ASU also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract.


In June 2014, the Financial Accounting Standards Board issued Accounting Standards Update No. 2014-10, which eliminated certain financial reporting requirements of companies previously identified as "Development Stage Entities" (Topic 915). The amendments in this ASU simplify accounting guidance by removing all incremental financial reporting requirements for development stage entities. The amendments also reduce data maintenance and, for those entities subject to audit, audit costs by eliminating the requirement for development stage entities to present inception-to-date information in the statements of income, cash flows, and shareholder equity.   Early application of each of the amendments is permitted for any annual reporting period or interim period for which the entity's financial statements have not yet been issued (public business entities) or made available for issuance (other entities). Upon adoption, entities will no longer present or disclose any information required by Topic 915.  The Company has adopted this standard.


The original effective date for ASU 2014-09 would have required the Company to adopt beginning in its first quarter 2017. In July 2015, the FASB voted to amend ASU 2014-09 by approving a one year deferral of the effective date as well as providing the option to early adopt the standard on the original effective date. Accordingly, the Company may adopt the standard in either its first quarter of 2017 or 2018. The new revenue standard may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of adoption. The Company is currently evaluating the timing of its adoption and the impact of adopting the new revenue standard on its consolidated financial statements.


In April 2015, the FASB issued ASU2015-03, Imputation of Interest, requiring entities to present debt issuance costs related to a debt liability as a reduction of the carrying amount of the liability. In August 2015, the FASB issued ASU 2015-15 to provide additional guidance related to debt issuance costs related to line-of-credit arrangements. The guidance is effective for annual and interim periods beginning after December 15, 2015, and early adoption is permitted. The Company is evaluating the impact, if any, that the adoption of this guidance will have on the Company’s consolidated financial statements and related disclosures.





F-9





GoGo Baby, Inc.


Notes To Financial Statements

December 31, 2016




NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)


The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.


NOTE 3 – INTANGIBLE ASSETS


The Company capitalized as intangible assets the purchase cost of the rights to a certain creation acquired from Lesa Foster in exchange for 50,000 common shares of GoGo Baby, Inc. valued at $0.0001 per share for a total value of $5 on June 6, 2013. As of 2016, the company recognized as an impairment loss $5.


NOTE 4 - PROVISION FOR INCOME TAXES


Realization of deferred tax assets is dependent upon sufficient future taxable income during the period that deductible temporary differences and carry-forwards are expected to be available to reduce taxable income.  As the achievement of required future taxable income is uncertain, the Company recorded a valuation allowance.  As of December 31, 2016 the Company had a net operating loss carry-forward of approximately $62,423.  Net operating loss carry-forward, expires twenty years from the date the loss was incurred.


The Company is subject to United States federal and state income taxes at an approximate rate of 34%.  The reconciliation of the provision for income taxes at the United States federal statutory rate compared to the Company’s income tax expense as reported is as follows:


 

December 31,

 

December 31,

 

2016

 

2015

 

 

 

 

 

 

Accumulated loss before income taxes per financial  statements

$

62,474  

 

$

43,165  

Income tax rate

 

34%

 

 

34%

Income tax recovery

 

(21,241) 

 

 

(14,676) 

Permanent differences

 

-  

 

 

-  

Temporary differences

 

-  

 

 

-  

Valuation allowance change

 

21,241  

 

 

14,676  

Provision for income taxes

 

-  

 

 

-  


Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.  Deferred income taxes arise from temporary differences in the recognition of income and expenses for financials reporting and tax purposes.  The significant components of deferred income tax assets and liabilities at December 31, 2016 are as follows:





F-10





GoGo Baby, Inc.

 

Notes To Financial Statements

December 31, 2016




NOTE 4 - PROVISION FOR INCOME TAXES- CONTINUED


 

December 31,

 

December 31,

 

2016

 

2015

 

 

 

 

 

 

Net operating loss carryforward

$

21,241 

 

$

14,676 

Valuation allowance

 

(21,241)

 

 

(14,676)

 

 

 

 

 

 

Net deferred income tax  asset

 

 

 


The Company has recognized a valuation allowance for the deferred income tax asset since the Company cannot be assured that it is more likely than not that such benefit will be utilized in future years.  The valuation allowance is reviewed annually. When circumstances change and which cause a change in management’s judgment about the realizability of deferred income tax assets, the impact of the change on the valuation allowance is generally reflected in current income.


NOTE 5 - COMMITMENTS AND CONTINGENCIES


Litigation


The Company is not presently involved in any litigation.


NOTE 6 – GOING CONCERN


Future issuances of the Company’s equity or debt securities will be required in order for the Company to continue to finance its operations and continue as a going concern. The Company’s present revenues are insufficient to meet operating expenses. The financial statement of the Company have been prepared assuming that the Company will continue as a going concern, which contemplates, among other things, the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has incurred cumulative net losses of $62,474 since its inception and requires capital for its contemplated operational and marketing activities to take place. The Company's ability to raise additional capital through the future issuances of common stock is unknown. The obtainment of additional financing, the successful development of the Company's contemplated plan of operations, and its transition, ultimately, to the attainment of profitable operations are necessary for the Company to continue operations. The ability to successfully resolve these factors raise substantial doubt about the Company's ability to continue as a going concern. The financial statements of the Company do not include any adjustments that may result from the outcome of these aforementioned uncertainties.


NOTE 7 – RELATED PARTY TRANSACTIONS


Malcolm Hargrave, the sole officer and director of the Company, may in the future, become involved in other business opportunities as they become available, thus he may face a conflict in selecting between the Company and his other business opportunities.  The Company has not formulated a policy for the resolution of such conflicts.


NOTE 8 – NOTES PAYABLE - RELATED PARTY


Since inception the Company received cash totaling $49,500 from Malcolm Hargrave in the form of a promissory note. As of December 31, 2016 and 2015, the amount due to Malcolm Hargrave was $49,500 and $32,000.





F-11





GoGo Baby, Inc.


Notes To Financial Statements

December 31, 2016




NOTE 8 – NOTES PAYABLE – RELATED PARTY- CONTINUED


On December 31, 2013, the Company received a $4,000 loan. This loan is at 4% interest with principle and interest all due on December 31, 2015. On December 31, 2015, the loan was extended to December 31, 2017.


On June 30, 2014, the Company received a $6,000 loan. This loan is at 4% interest with principle and interest all due on June 30, 2016. On June 30, 2016, the loan was extended to June 30, 2018.


On September 9, 2014, the Company received a $9,000 loan. This loan is at 4% interest with principle and interest all due on September 9, 2016. On September 9, 2016, the loan was extended to September 9, 2018.


On January 5, 2015, the Company received a $4,000 loan. This loan is at 4% interest with principle and interest all due on January 5, 2017.


On April 20, 2015, the Company received a $9,000 loan. This loan is at 4% interest with principle and interest all due on April 20, 2017.


On February 26, 2016, the Company received a $5,000 loan. This loan is at 4% interest with principle and interest all due on February 26, 2018.


On April 11, 2016, the Company received a $5,000 loan. This loan is at 4% interest with principle and interest all due on April 11, 2018.


On August 3, 2016, the Company received a $1,500 loan. This loan is at 4% interest with principle and interest all due on August 3, 2018.


On November 7 2016, the Company received a $5,000 loan. This loan is at 4% interest with principle and interest all due on November 7, 2018.


On December 21, 2016, the Company received a $1,000 loan. This loan is at 4% interest with principle and interest all due on December 21, 2018.


As of December 31, 2016, accrued interest is $ 3,215 and December 31, 2015 is $1,519.


NOTE 9 – STOCK TRANSACTIONS


On June 6, 2013, the Company issued a total of 50,000 shares of common stock to Lesa Foster in exchange for a toy patent for a cash value of $0.0001 per share for a total value of $5


On June 21, 2013 the Company issued a total of 10,000,000 shares of common stock to one director for cash in the amount of $0.0001 per share for a total of $1,000


On November 14, 2013, the Company issued a total of 1,500,000 shares of common stock to DTH for cash in the amount of $0.000666 per share for a total of $1,000.


On June 9, 2014 the Company issued a total of 25,000,000 shares of common stock to one director for cash in the amount of $0.0001 per share for a total of $2,500


As of December 31, 2016 the Company had 36,550,000 shares of common stock issued and outstanding.




F-12





GoGo Baby, Inc.

 

Notes To Financial Statements

December 31, 2016




NOTE 10 – STOCKHOLDERS’ EQUITY


The stockholders’ equity section of the Company contains the following classes of capital stock as of December 31, 2016:


Common stock, $ 0.0001 par value: 100,000,000 shares authorized; 36,550,000 shares issued and outstanding.


Preferred stock, $ 0.0001 par value: 20,000,000 shares authorized; no shares issued and outstanding.


NOTE 11 – SUBSEQUENT EVENT


On January 13, 2017, the Company received a $1,000 loan. This loan is at 4% interest with principle and interest all due on January 13, 2019 On February 28, 2017 the Company received a $2,000 loan. This loan is at 4% interest with principle and interest all due on February 28, 2019.




F-13





Alpha Investment Inc.

Balance Sheets



 

 

As of

 

As of

 

 

June 30,

 

December 31,

 

 

2017

 

2016

 

 

(Unaudited)

 

 

 

ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

Current Assets

 

 

 

 

 

 

Cash

 

$

 

$

382 

Total Current Assets

 

 

 

 

382 

 

 

 

 

 

 

 

Other Assets

 

 

 

 

 

 

Intangible Assets, net

 

 

 

 

Total Other Assets

 

 

 

 

 

 

 

 

 

 

 

TOTAL ASSETS

 

$

 

$

382 

 

 

 

 

 

 

 

LIABILITIES & STOCKHOLDERS' DEFICIT

 

 

 

 

 

 

 

 

 

 

 

 

 

Current Liabilities

 

 

 

 

 

 

Accounts payable

 

$

1,640 

 

$

5,636 

Promissory notes payable--long term notes due in one year

 

 

 

 

13,000 

Accrued interest

 

 

 

 

1,093 

Total Current Liabilities

 

 

1,640 

 

 

19,729 

 

 

 

 

 

 

 

Long-Term Liabilities

 

 

 

 

 

 

Accrued interest

 

 

 

 

2,122 

Promissory note payable

 

 

 

 

36,500 

Total Long-Term Liabilities

 

 

 

 

38,622 

 

 

 

 

 

 

 

Total Liabilities

 

 

1,640 

 

 

58,351 

 

 

 

 

 

 

 

Stockholders' Deficit

 

 

 

 

 

 

Preferred Stock ($0.0001 par value, 20,000,000 shares authorized; zero shares issued and outstanding as of June 30, 2017 and December 31, 2016

 

 

 

 

Common stock, ($0.0001 par value, 105,000,000 shares authorized; 40,175,000 and 36,550,000 shares issued and outstanding as of June 30, 2017 and December 31, 2016

 

 

4,018 

 

 

3,655 

Additional paid-in capital

 

 

80,703 

 

 

850 

Deficit accumulated

 

 

(86,360)

 

 

(62,474)

Total Stockholders' Deficit

 

 

(1,639)

 

 

(57,969)

 

 

 

 

 

 

 

TOTAL LIABILITIES & STOCKHOLDERS' DEFICIT

 

$

 

$

382 


The accompanying notes are an integral part of these financial statements





F-14





Alpha Investment Inc.

Statements of Operations

(Unaudited)



 

Three Months

 

Three Months

 

Six Months

 

Six Months

 

Ended

 

Ended

 

Ended

 

Ended

 

June 30,

 

June 30,

 

June 30,

 

June 30,

 

2017

 

2016

 

2017

 

2016

Revenues

 

 

 

 

 

 

 

 

 

 

 

Revenues

$

12,000 

 

$

 

$

12,000 

 

$

Total Revenues

 

12,000 

 

 

 

 

12,000 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

General & Administrative Expenses

 

 

 

 

 

 

 

 

 

 

 

Administrative expenses

 

10,954 

 

 

2,520 

 

 

14,186 

 

 

11,491 

Stock compensation for consulting services

 

14,500 

 

 

 

 

 

14,500

 

 

 

Professional fees

 

2,700 

 

 

2,000 

 

 

7,200 

 

 

10,500 

Total General & Administrative Expenses

 

28,154 

 

 

4,520 

 

 

35,886 

 

 

21,991 

 

 

 

 

 

 

 

 

 

 

 

 

Loss from Operation

 

(16,154)

 

 

(4,520)

 

 

(23,886)

 

 

(21,991)

 

 

 

 

 

 

 

 

 

 

 

 

Other Expense

 

 

 

 

 

 

 

 

 

 

 

Impairment loss

 

 

 

 

 

 

 

Interest expense

 

 

 

415 

 

 

 

 

754 

Total Other Expenses

 

 

 

415 

 

 

 

 

754 

 

 

 

 

 

 

 

 

 

 

 

 

Other Income

 

 

 

 

 

 

 

 

 

 

 

Donation from Shareholders

 

 

 

 

 

 

 

Gain on Debt Forgiveness

 

 

 

 

 

 

 

Total Other Income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income (Loss)

$

(16,154)

 

$

(4,935)

 

$

(23,886)

 

$

(10,840)

 

 

 

 

 

 

 

 

 

 

 

 

Basic earnings per share

$

(0.00)

 

$

(0.00)

 

$

(0.00)

 

$

(0.00)

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average number of common shares outstanding

 

40,135,165 

 

 

36,550,000 

 

 

36,730,249 

 

 

36,550,000 


The accompanying notes are an integral part of these financial statements







F-15





Alpha Investment Inc.

Statements of Cash Flows

(Unaudited)



 

 

Six Months

 

Six Months

 

 

Ended

 

Ended

 

 

June 30,

 

June 30,

 

 

2017

 

2016

 

 

 

 

 

 

 

CASH FLOWS FROM OPERATING ACTIVITIES

 

 

 

 

 

 

Net income (loss)

 

$

(23,886)

 

$

(10,840)

Adjustments to reconcile net loss to net cash provided by (used in) operating activities:

 

 

 

 

 

 

Stock compensation for consulting services

 

 

14,500 

 

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

Increase (Decrease) in accounts payable and accrued liabilities

 

 

(3,996)

 

 

(136)

Net cash provided by (used in) operating activities

 

 

(13,382)

 

 

(10,976)

 

 

 

 

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES

 

 

 

 

 

 

Acquisition of Intangible Assets

 

 

 

 

Net cash provided by (used in) investing activities

 

 

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES

 

 

 

 

 

 

Proceed from donation from shareholder

 

 

10,000 

 

 

10,000 

Proceed from notes payable - related party

 

 

3,000 

 

 

Net cash provided by (used in) financing activities

 

 

13,000 

 

 

10,000 

 

 

 

 

 

 

 

Net increase (decrease) in cash

 

 

(382)

 

 

(222)

Cash at beginning of period

 

 

382 

 

 

416 

Cash at end of period

 

$

 

$

194 

 

 

 

 

 

 

 

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash paid during period for:

 

 

 

 

 

 

Interest

 

$

 

$

Income Taxes

 

$

 

$



The accompanying notes are an integral part of these financial statements





F-16





Alpha Investment Inc.

Notes To Condensed Financial Statements (Unaudited)

June 30, 2017




NOTE 1 – ORGANIZATION AND DESCRIPTION OF BUSINESS


Corporate History


Alpha Investment Inc., formerly GoGo Baby, Inc. (the “ Company ”) was incorporated on February 22, 2013 under the laws of the State of Delaware to develop, create, manufacture and market, toys for small children which would be designed to attach to car seats and amuse and entertain children during a drive, without distracting the attention of the driver.  The Company, however, encountered significant constraints in raising sufficient capital to fully implement its business plan.


On March 17, 2017, Omega Commercial Finance Corp. purchased all 35,550,000 outstanding “ restricted ” shares of the Company’s common stock (the “ Control Share Sale ”) from Malcolm Hargrave (35,000,000 shares), DTH International Corporation (500,000 shares) and Lisa Foster (50,000 shares) for aggregate consideration of $295,000.  The Control Share Sale was consummated in a private transaction pursuant to a common stock purchase agreement entered between Omega and Mr. Hargrave, acting individually and on behalf of the other selling stockholders.  Upon completion of the Control Share Sale, a “ Change in Control” of the Company took place and in connection therewith, Mr. Hargrave resigned as our sole director and officer and Omega, as the new majority stockholder of the Company, elected Timothy R. Fussell, Ph.D. as President, Chairman of the Board and a director and Todd C. Buxton, Omega’s Chief Executive Officer, as Chief Executive Officer, Vice Chairman of the Board and a director.


In addition to the foregoing, new management elected to focus the shift in the Company’s business focus to real estate and other commercial lending, which they believed offered better opportunities for shareholder growth.  In connection therewith, on March 30, 2017, we filed a Certificate of Amendment to our Certificate of Incorporation with the Delaware Secretary of State changing our name from “ Gogo Baby, Inc. ” to “ Alpha Investment Inc. ” to better reflect our new business plan.   The name change and a corresponding change in the Company’s OTC markets trading symbol from GGBY to ALPC received approval from FINRA and became effective as of April 19, 2017.


The Company’s activities to date have been limited to activities organizational matters, as well as planning implementation of its proposed business.  The Company’s fiscal year end is December 31.


Basis of Presentation – Unaudited Financial Statements


The accompanying unaudited financial statements have been prepared in accordance with generally accepted accounting principles for financial information and with the instructions to Form 10-Q.  They do not include all information and footnotes required by United States generally accepted accounting principles for complete financial statements.  However, except as disclosed herein, there has been no material changes in the information disclosed in the notes to the financial statements for the fiscal year ended December 31, 2016 included in the Company’s Form 10-K filed with the Securities and Exchange Commission on March 16, 2017.  The unaudited financial statements should be read in conjunction with those financial statements included in the Form 10-K. In the opinion of Management, all adjustments considered necessary for a fair presentation, consisting solely of normal recurring adjustments, have been made. Operating results for the three and six months ended June 30, 2017 are not necessarily indicative of the results that may be expected for the year ending December 31, 2017.




F-17





Alpha Investment Inc.

Notes To Condensed Financial Statements (Unaudited)

June 30, 2017




NOTE 2 – GOING CONCERN


Future issuances of the Company’s equity or debt securities will be required in order for the Company to continue to finance its operations and continue as a going concern. The Company’s present revenues are insufficient to meet operating expenses. The financial statement of the Company have been prepared assuming that the Company will continue as a going concern, which contemplates, among other things, the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has incurred cumulative net losses of $86,360 since its inception and requires capital for its contemplated operational and marketing activities to take place. The Company's ability to raise additional capital through the future issuances of common stock is unknown. Securing additional financing, the successful development of the Company's contemplated plan of operations, and its transition, ultimately, to the attainment of profitable operations are necessary for the Company to continue operations. The ability to successfully resolve these factors raise substantial doubt about the Company's ability to continue as a going concern. The financial statements of the Company do not include any adjustments that may result from the outcome of these aforementioned uncertainties.


NOTE 3 – RELATED PARTY TRANSACTION


1.  Related Party Loan


 

June 30,

 

December 31,

 

2017

 

2016

 

 

 

 

 

 

Long Term Notes Payable-related part

$

0

 

$

49,500

Less: Due in one year

 

0

 

 

17,000

Balance

$

0

 

$

32,500


Since inception the Company received cash totaling $52,500 from Malcolm Hargrave, the previous director, in the form of a promissory note. The loan is at interest 4%. On March 17, 2017 Malcolm Hargrave signed an agreement to forgive all debt, including unpaid interest, amounting $ 55,715, due to him from the Company and as of June 30, 2017, the amount due to Malcolm Hargrave was $0.


2. Consulting revenue


On May 1, 2017 the company billed Omega Commercial Finance Corp., the 88.48% shareholder,  $12,000 for consulting services in capital markets activities rendered, such as defining appropriate capital raising mechanisms and types of Offerings to utilize what best benefits the Company’s verticals overall, strategies to implement within the capital markets for growth and increased shareholder value, effective means to create relationships within the CRE sector for target mergers and acquisitions, loan financing requests, distressed commercial real estate portfolios.





F-18





Alpha Investment Inc.

Notes To Condensed Financial Statements (Unaudited)

June 30, 2017




NOTE 4 – STOCKHOLDERS’ EQUITY


The stockholders’ equity section of the Company contains the following classes of capital stock as of June 30, 2017:


Ÿ

Common stock, $ 0.0001 par value: 105,000,000 shares authorized; 40,175,000 shares issued and outstanding.


Ÿ

Preferred stock, $ 0.0001 par value: 20,000,000 shares authorized; no shares issued and outstanding.


On March 17, 2017, Malcolm Hargrave signed an agreement to forgive all debt, including unpaid interest, amounting $ 55,715, due to him from the Company. This was classified as additional paid -in capital.


On March 29, 2017, Omega, the principal stockholder of the Company, made an additional capital contribution to the Company of $10,000. This was classified as additional paid-in capital.


On June 21, 2017 the company filed an S-8 with the SEC to register an additional 5,000,000 shares of common stock with a par value of $0.0001.


On June 22, 2017 3,625,000 shares of common stock were issued at a value of $0.004 per share to various individuals in exchange for consulting services.

 




F-19





PART II


INFORMATION NOT REQUIRED IN THE PROSPECTUS


ITEM 13.  OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION


Registration Fees

 

$

64,524.00

Transfer Agent Fees

 

$

*

Accounting Fees and Expenses

 

$

*

Legal Fees and Expenses

 

$

*

Miscellaneous Fees and Expenses

 

$

*

Total

 

$

*

*To be filed by amendment.


All amounts are estimates other than the SEC’s registration fee.  We are paying all expenses of the offering listed above.  No portion of these expenses will be borne by the selling stockholders.  The selling stockholders, however, will pay any other expenses incurred in selling their common stock, including any brokerage commissions or costs of sale.


ITEM 14.  INDEMNIFICATION OF DIRECTORS AND OFFICERS


Our Certificate of Incorporation provides for indemnification of our officers and directors to the fullest extent permitted by the Delaware General Corporation Law (the “ DGCL ”)


Section 145 of the DGCL provides that the Company may indemnify any officer or director who was made a party to a suit because of his or her position, including derivative suits, if he was acting in good faith and in a manner he or she reasonably believed was in the best interest of the Company, except, in certain circumstances, for negligence or misconduct in the performance of his or her duty to the Company. If the director or officer is successful in his or her suit, he or she is entitled to indemnification for expenses, including attorneys' fees.


ITEM 15.  RECENT SALES OF UNREGISTERED SECURITIES


During the past two years, we effected the following transactions in reliance upon exemptions from registration under the Securities Act, as amended:


(a)       On June 21, 2017, we issued 3,625,000 shares of our common stock to six consultants pursuant to restricted stock awards under our 2017 Stock Incentive Plan.


(b)       On September 20, 2017, we sold an aggregate of 56,667 shares of our common stock to a single investor in a private transaction for aggregate consideration of $850,000.


(c)      On September 25, 2017, we sold an aggregate of 166,667 shares of our common stock to a single investor in a private transaction for aggregate consideration of $2,500,000


All of the foregoing securities were issued in accordance with the exemption from registration afforded by Section 4(a) (2) of and Regulation D or Rule 701 promulgated under the Securities Act, as amended, as the persons receiving such shares having provided the Company with appropriate representations as to their investment intent and their status as “ accredited investors ” as defined in Rule 501(a) of Regulation D promulgated under the Securities Act.





II-1





ITEM 16.  EXHIBITS


Exhibit

Number

Description


3 (i)

Certificate of Incorporation, as amended (1)


3 (ii)

By-Laws (2)


5.1

Opinion of Gutiérrez Bergman Boulris, PLLC (3)


10.1

2017 Incentive Stock Plan (4) *


10.2

Form of Direct Offering Subscription Agreement (4)


10.3

Subscription Agreement with Dr. Assia Benhacene (5)


10.4

Subscription Agreement with Hoosier Real Estate Investors, LLC (4)


10.7

Code of Ethics (4)


23.1

Consent of Independent Registered Public Accounting Firm (4)


23.2

Consent of Gutiérrez Bergman Boulris, PLLC (Included in Exhibit 5.1) (3)


24

Power of Attorney (included in signature page to this registration statement) 


(1)

Filed as an Exhibit of the same number to registrant’s Registration Statement on Form S-1 (File No. 333-198772) and incorporated herein by reference, as amended by an amendment thereto, filed as Exhibit 3.1 to registrant’s Current Report on Form 8-K dated April 19, 2017 and incorporated herein by reference.


(2)

Filed as an Exhibit of the same number to registrant’s Registration Statement on Form S-1 (File No. 333-198772) and incorporated herein by reference.


(3)

To be filed by amendment.


(4)

Filed herewith.


(5)

Filed as Exhibit 10.1 to the registrant’s Current Report on Form 8-K dated September 5, 2017 and incorporated herein by reference.


*

Management compensation plan or arrangement.




II-2




ITEM 17.  UNDERTAKINGS


The undersigned registrant hereby undertakes:


1.             To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement;


(a)           to include any prospectus required by Section 10(a) (3) of the Securities Act of 1933;


(b)           to reflect in the prospectus any facts or events which, individually or together, represent a fundamental change in the information in the registration statement; and notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospects filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in the volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement.; and


(c)           to include any material information with respect to the plan of distribution not previously disclosed in this registration statement or any material change to such information in the registration statement.


2.             That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered herein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.


3.             To remove from registration by means of a post-effective amendment any of the securities being registered hereby which remain unsold at the termination of the offering.


4.             That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities:, the undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:


(a)           Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424 (§230.424 of this chapter);


(b)           Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;


(c)           The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and


(d)           Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.


Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to our directors, officers and controlling persons pursuant to the provisions above, or otherwise, we been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act of 1933, and is, therefore, unenforceable.  In the event that a claim for indemnification against such liabilities, other than the payment by us of expenses incurred or paid by one of our directors, officers, or controlling persons in the successful defense of any action, suit or proceeding, is asserted by one of our directors, officers, or controlling persons in connection with the securities being registered, we will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification is against public policy as expressed in the Securities Act of 1933, and we will be governed by the final adjudication of such issue.


Each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B of the Securities Act or other than prospectuses filed in reliance on Rule 430A of the Securities Act, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness,  provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.



II-3





SIGNATURES


In accordance with the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-1 and authorized this Registration Statement to be signed on its behalf by the undersigned, in Columbus Ohio on October 27, 2017.


 

ALPHA INVESTMENT INC.

 

 

 

 

By:

/s/ Todd C. Buxton

 

 

Todd C. Buxton, Chief Executive Officer

 

 

(Principal Executive, Financial and Accounting Officer)

 

 

 



POWER OF ATTORNEY


KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Timothy T. Fussell, Ph.D. and Todd C. Buxton and each of them, as a true and lawful attorney-in-fact and agent, with full power of substitution and re-substitution, for each of them and in each name, place and stead, in any and all capacities, to sign any and all pre- or post-effective amendments to this registration statement, and to file the same with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact and agent, full power and authority to do and perform each and every act and thing requisite or necessary to be done in and about the premises, as fully to all intents and purposes as each might or could do in person, hereby ratifying and confirming all that said attorney-in-fact and agent or his substitute, may lawfully do or cause to be done by virtue hereof.  In accordance with the requirements of the Securities Act of 1933, as amended, this registration statement was signed by the following person in the capacities and on the dates stated.


Signatures

 

Title(s)

 

Date

 

 

 

 

 

 

/s/ Todd C. Buxton

 

Chief Executive Officer, Vice Chairman and Director

 

October 27, 2017

 

Todd C. Buxton

 

(Principal Executive, Financial and Accounting Officer)

 

 

 

 

 

 

 

 

 

/s/ Timothy R. Fussell

 

President, Chairman and Director

 

October 27, 2017

 

Timothy R. Fussell

 

 

 

 







II-4



Exhibit 10.1



ALPHA INVESTMENT INC.


2017 STOCK INCENTIVE PLAN


1.

Purposes of the Plan .  The purposes of this Plan are to attract and retain the best available personnel, to provide additional incentives to Employees, Directors and Consultants and to promote the success of the Company’s business.

2.

Definitions .  The following definitions shall apply as used herein and in the individual Award Agreements except as defined otherwise in an individual Award Agreement.  In the event a term is separately defined in an individual Award Agreement, such definition shall supersede the definition contained in this Section 2 .

(a)

Administrator ” means the Board or any of the Committees appointed to administer the Plan.

(b)

Affiliate ” and “ Associate ” shall have the respective meanings ascribed to such terms in Rule 12b-2 promulgated under the Exchange Act.

(c)

Applicable Laws ” means the legal requirements relating to the Plan and the Awards under applicable provisions of federal securities laws, state corporate and securities laws, the Code, the rules of any applicable stock exchange or national market system, and the rules of any non-U.S. jurisdiction applicable to Awards granted to residents therein.

(d)

Assumed ” means that pursuant to a Corporate Transaction either (i) the Award is expressly affirmed by the Company or (ii) the contractual obligations represented by the Award are expressly assumed (and not simply by operation of law) by the successor entity or its Parent in connection with the Corporate Transaction with appropriate adjustments to the number and type of securities of the successor entity or its Parent subject to the Award and the exercise or purchase price thereof which at least preserves the compensation element of the Award existing at the time of the Corporate Transaction as determined in accordance with the instruments evidencing the agreement to assume the Award.  

(e)

Award ” means the grant of an Option, SAR, Dividend Equivalent Right, Restricted Stock, Restricted Stock Unit or other right or benefit under the Plan.

(f)

Award Agreement ” means the written agreement evidencing the grant of an Award executed by the Company and the Grantee, including any amendments thereto.

(g)

Board ” means the Board of Directors of the Company.

(h)

Cause ” means, with respect to the termination by the Company or a Related Entity of the Grantee’s Continuous Service, that such termination is for “ Cause ” as such term (or word of like import) is expressly defined in a then-effective written agreement between the Grantee and the Company or such Related Entity, or in the absence of such then-effective written agreement and definition, is based on, in the determination of the Administrator, the Grantee’s:  (i) performance of any act or failure to perform any act in bad faith and to the detriment of the Company or a Related Entity; (ii) dishonesty, intentional misconduct or material breach of any agreement with the Company or a Related Entity; or (iii) commission of a crime involving dishonesty, breach of trust, or physical or emotional harm to any person; provided, however, that with regard to any agreement that defines “ Cause ” on the occurrence of or in connection with a Corporate Transaction or a Change in Control, such definition of “ Cause ” shall not apply until a Corporate Transaction or a Change in Control actually occurs.



1 | Page




(i)

Change in Control means a change in ownership or control of the Company after the Registration Date effected through either of the following transactions:

(i)

the direct or indirect acquisition by any person or related group of persons (other than an acquisition from or by the Company or by a Company-sponsored employee benefit plan or by a person that directly or indirectly controls, is controlled by, or is under common control with, the Company) of beneficial ownership (within the meaning of Rule 13d-3 of the Exchange Act) of securities possessing more than fifty percent (50%) of the total combined voting power of the Company’s outstanding securities pursuant to a tender or exchange offer made directly to the Company’s stockholders which a majority of the Continuing Directors who are not Affiliates or Associates of the offeror do not recommend such stockholders accept, or

(ii)

a change in the composition of the Board over a period of twelve (12) months or less such that a majority of the Board members (rounded up to the next whole number) ceases, by reason of one or more contested elections for Board membership, to be comprised of individuals who are Continuing Directors.

(j)

Code ” means the Internal Revenue Code of 1986, as amended.

(k)

Committee ” means any committee composed of members of the Board appointed by the Board to administer the Plan.

(l)

Common Stock ” means the common stock of the Company.

(m)

Company ” means Alpha Investment Inc., a Delaware corporation, or any successor entity that adopts the Plan in connection with a Corporate Transaction.

(n)

Consultant ” means any person (other than an Employee or a Director, solely with respect to rendering services in such person’s capacity as a Director) who is engaged by the Company or any Related Entity to render consulting or advisory services to the Company or such Related Entity.

(o)

Continuing Directors ” means members of the Board who either (i) have been Board members continuously for a period of at least twelve (12) months or (ii) have been Board members for less than twelve (12) months and were elected or nominated for election as Board members by at least a majority of the Board members described in clause (i) who were still in office at the time such election or nomination was approved by the Board.

(p)

Continuous Service ” means that the provision of services to the Company or a Related Entity in any capacity of Employee, Director or Consultant is not interrupted or terminated.  In jurisdictions requiring notice in advance of an effective termination as an Employee, Director or Consultant, Continuous Service shall be deemed terminated upon the actual cessation of providing services to the Company or a Related Entity notwithstanding any required notice period that must be fulfilled before a termination as an Employee, Director or Consultant can be effective under Applicable Laws.  A Grantee’s Continuous Service shall be deemed to have terminated either upon an actual termination of Continuous Service or upon the entity for which the Grantee provides services ceasing to be a Related Entity. Continuous Service shall not be considered interrupted in the case of (i) any approved leave of absence; (ii) transfers among the Company, any Related Entity, or any successor, in any capacity of Employee, Director or Consultant; or (iii) any change in status as long as the individual remains in the service of the Company or a Related Entity in any capacity of Employee, Director or Consultant (except as otherwise provided in the Award Agreement).  Notwithstanding the foregoing, except as otherwise determined by the Administrator, in the event of any spin-off of a Related Entity, service as an Employee, Director or Consultant for such Related Entity following such spin-off shall be deemed to be Continuous Service for purposes of the Plan and any Award under the Plan.  An approved leave of absence shall include sick leave, military leave, or any other authorized personal leave.  For purposes of each Incentive Stock Option granted under the Plan, if such leave exceeds three months, and reemployment upon expiration of such leave is not guaranteed by statute or contract, then the Incentive Stock Option shall be treated as a Non-Qualified Stock Option on the day three months and one day following the expiration of such three month period.



2 | Page




(q)

Corporate Transaction ” means any of the following transactions, provided, however, that the Administrator shall determine under parts (iv) and (v) whether multiple transactions are related, and its determination shall be final, binding and conclusive:  

(i)

a merger or consolidation in which the Company is not the surviving entity, except for a transaction the principal purpose of which is to change the state in which the Company is incorporated;

(ii)

the sale, transfer or other disposition of all or substantially all of the assets of the Company;

(iii)

the complete liquidation or dissolution of the Company;

(iv)

any reverse merger or series of related transactions culminating in a reverse merger (including, but not limited to, a tender offer followed by a reverse merger) in which the Company is the surviving entity but (A) the shares of Common Stock outstanding immediately prior to such merger are converted or exchanged by virtue of the merger into other property, whether in the form of securities, cash or otherwise; or (B) in which securities possessing more than forty percent (40%) of the total combined voting power of the Company’s outstanding securities are transferred to a person or persons different from those who held such securities immediately prior to such merger or the initial transaction culminating in such merger, but excluding any such transaction or series of related transactions that the Administrator determines shall not be a Corporate Transaction; or

(v)

acquisition in a single or series of related transactions by any person or related group of persons (other than the Company or by a Company-sponsored employee benefit plan) of beneficial ownership (within the meaning of Rule 13d-3 of the Exchange Act) of securities possessing more than fifty percent (50%) of the total combined voting power of the Company’s outstanding securities but excluding any such transaction or series of related transactions that the Administrator determines shall not be a Corporate Transaction.

(r)

Covered Employee ” means an Employee who is a “covered employee” under Section 162(m) (3) of the Code.

(s)

Director ” means a member of the Board or the board of directors of any Related Entity.

(t)

Disability ” means as defined under the long-term disability policy of the Company or the Related Entity to which the Grantee provides services regardless of whether the Grantee is covered by such policy.  If the Company or the Related Entity to which the Grantee provides service does not have a long-term disability plan in place, “Disability” means that a Grantee is unable to carry out the responsibilities and functions of the position held by the Grantee by reason of any medically determinable physical or mental impairment for a period of not less than ninety (90) consecutive days.  A Grantee will not be considered to have incurred a Disability unless he or she furnishes proof of such impairment sufficient to satisfy the Administrator in its discretion.

(u)

Dividend Equivalent Right ” means a right entitling the Grantee to compensation measured by dividends paid with respect to Common Stock.

(v)

Employee ” means any person, including an Officer or Director, who is in the employ of the Company or any Related Entity, subject to the control and direction of the Company or any Related Entity as to both the work to be performed and the manner and method of performance.  The payment of a Director’s fee by the Company or a Related Entity shall not be sufficient to constitute “ employment ” by the Company.

(w)

Exchange Act ” means the Securities Exchange Act of 1934, as amended.

(x)

Fair Market Value ” means, as of any date, the value of Common Stock determined as follows:



3 | Page




(i)

If the Common Stock is listed on one or more established stock exchanges or national market systems, including without limitation The NASDAQ Global Select Market, The NASDAQ Global Market, The NASDAQ Capital Market of The NASDAQ Stock Market LLC, the New York Stock Exchange or the NYSE MKT, its Fair Market Value shall be the closing sales price for such stock (or the closing bid, if no sales were reported) as quoted on the principal exchange or system on which the Common Stock is listed (as determined by the Administrator) on the date of determination (or, if no closing sales price or closing bid was reported on that date, as applicable, on the last trading date such closing sales price or closing bid was reported), as reported in The Wall Street Journal or such other source as the Administrator deems reliable;

(ii)

If the Common Stock is regularly quoted on an automated quotation system (including the various tiers of the over-the-counter market maintained by OTC Markets Group, Inc. or by a recognized securities dealer, its Fair Market Value shall be the closing sales price for such stock as quoted on such system or by such securities dealer on the date of determination or the average of any such prices for such period as determined by the Administrator in good faith not to exceed thirty (30) trading days prior to the date of determination, but if selling prices are not reported, the Fair Market Value of a share of Common Stock shall be the mean between the high bid and low asked prices for the Common Stock on the date of determination (or, if no such prices were reported on that date, on the last date such prices were reported) or the average thereof for such period prior to the date of determination as established by the Administrator above, as reported in The Wall Street Journal or such other source as the Administrator deems reliable; or

(iii)

In the absence of an established market for the Common Stock of the type described in (i) and (ii), above, the Fair Market Value thereof shall be determined by the Administrator in good faith.

(y)

Good Reason means the occurrence after a Corporate Transaction or Change in Control of any of the following events or conditions unless consented to by the Grantee (and the Grantee shall be deemed to have consented to any such event or condition unless the Grantee provides written notice of the Grantee’s non-acquiescence within thirty (30) days of the effective time of such event or condition):

(i)

a change in the Grantee’s responsibilities or duties that represents a material and substantial diminution in the Grantee’s responsibilities or duties as in effect immediately preceding the consummation of a Corporate Transaction or Change in Control;

(ii)

a reduction in the Grantee’s base salary to a level below that in effect at any time within six months preceding the consummation of a Corporate Transaction or Change in Control or at any time thereafter; provided that an across-the-board reduction in the salary level of substantially all other individuals in positions similar to the Grantee’s by substantially the same percentage amount shall not constitute such a salary reduction; or

(iii)

requiring the Grantee to be based at any place outside a 50-mile radius from the Grantee’s job location or residence prior to the Corporate Transaction or Change in Control except for reasonably required travel on business that is not materially greater than such travel requirements prior to the Corporate Transaction or Change in Control.  

(z)

Grantee ” means an Employee, Director or Consultant who receives an Award under the Plan.

(aa)

Incentive Stock Option ” means an Option intended to qualify as an incentive stock option within the meaning of Section 422 of the Code.

(bb)

Non-Qualified Stock Option ” means an Option not intended to qualify as an Incentive Stock Option.

(cc)

Officer ” means a person who is an officer of the Company or a Related Entity within the meaning of Section 16 of the Exchange Act and the rules and regulations promulgated thereunder.



4 | Page




(dd)

Option ” means an option to purchase Shares pursuant to an Award Agreement granted under the Plan.

(ee)

Parent ” means a “parent corporation”, whether now or hereafter existing, as defined in Section 424(e) of the Code.

(ff)

Performance-Based Compensation ” means compensation qualifying as “performance-based compensation” under Section 162(m) of the Code.

(gg)

Plan ” means this 2017 Stock Incentive Plan.

(hh)

Registration Date ” means the first to occur of (i) the closing of the first sale, subsequent to the date this Plan is adopted, to the general public pursuant to a registration statement filed with and declared effective by the Securities and Exchange Commission under the Securities Act, of (A) the Common Stock; or (B) the same class of securities of a successor corporation (or its Parent) issued pursuant to a Corporate Transaction in exchange for or in substitution of the Common Stock; (ii) the date the Common Stock is otherwise registered under and the Company becomes subject to the reporting requirements of Sections 13 or 15 (d) or the Exchange Act; and (iii) in the event of a Corporate Transaction, the date of the consummation of the Corporate Transaction if the same class of securities of the successor corporation (or its Parent) issuable in such Corporate Transaction shall have been sold to the general public pursuant to a registration statement filed with and declared effective by the Securities and Exchange Commission under the Securities Act, on or prior to the date of consummation of such Corporate Transaction.

(ii)

Related Entity ” means any Parent or Subsidiary of the Company.

(jj)

Replaced ” means that pursuant to a Corporate Transaction the Award is replaced with a comparable stock award or a cash incentive program of the Company, the successor entity (if applicable) or Parent of either of them which preserves the compensation element of such Award existing at the time of the Corporate Transaction and provides for subsequent payout in accordance with the same (or a more favorable) vesting schedule applicable to such Award.  The determination of Award comparability shall be made by the Administrator and its determination shall be final, binding and conclusive.

(kk)

Restricted Stock ” means Shares issued under the Plan to the Grantee for such consideration, if any, and subject to such restrictions on transfer, rights of first refusal, repurchase provisions, forfeiture provisions, and other terms and conditions as established by the Administrator.  

(ll)

Restricted Stock Units ” means an Award that may be earned in whole or in part upon the passage of time or the attainment of performance criteria established by the Administrator and that may be settled for cash, Shares or other securities or a combination of cash, Shares or other securities as established by the Administrator.

(mm)

Rule 16b-3 ” means Rule 16b-3 promulgated under the Exchange Act or any successor thereto.

(nn)

SAR ” means a stock appreciation right entitling the Grantee to Shares or cash compensation, as established by the Administrator, measured by appreciation in the value of Common Stock.

(oo)

Securities Act ” means the Securities Act of 1933, as amended.

(pp)

Share ” means a share of the Common Stock.

(qq)

Subsidiary ” means a “subsidiary corporation”, whether now or hereafter existing, as defined in Section 424(f) of the Code.



5 | Page




3.

Stock Subject to the Plan .

(a)

Subject to the provisions of Section  10, below, the maximum aggregate number of Shares that may be issued pursuant to all Awards is 5,000,000 Shares, plus an annual increase to be added on the first day of the calendar year beginning January 1, 2018 equal to (i) the greater of such number of shares as (A) will set the maximum number of Shares that may be issued pursuant to all Awards equal to 15% of the number of Shares outstanding as of such date; or (B) 2% of the number of Shares outstanding as of such date; or (ii) a lesser number of Shares determined by the Administrator. Notwithstanding the foregoing, subject to the provisions of Section  10, below, of the number of Shares specified above, the maximum aggregate number of Shares available for grant of Incentive Stock Options shall be 2,500,000 Shares, increased on the first day of the calendar year beginning January 1, 2018, in a number of Shares proportionate to the increase in the total number of Shares that may be issued pursuant to all Awards under this Plan, as set forth in this Section 3 .  The Shares to be issued pursuant to Awards may be authorized, but unissued or reacquired Shares.  

(b)

Any Shares covered by an Award (or portion of an Award) that is forfeited, canceled or expires (whether voluntarily or involuntarily) shall be deemed not to have been issued for purposes of determining the maximum aggregate number of Shares that may be issued under the Plan.  Shares that actually have been issued under the Plan pursuant to an Award shall not be returned to the Plan and shall not become available for future issuance under the Plan, except that if unvested Shares are forfeited, or repurchased by the Company at the lesser of their original purchase price or their Fair Market Value at the time of repurchase, such Shares shall become available for future grant under the Plan

(c)

To the extent not prohibited by the listing requirements of The NASDAQ Stock Market LLC (or other established stock exchange or national market system on which the Common Stock is traded) or Applicable Law, any Shares covered by an Award that are surrendered (i) in payment of the Award exercise or purchase price (including pursuant to the “net exercise” of an option pursuant to Section 7(b)(v)) or (ii) in satisfaction of tax withholding obligations incident to the exercise of an Award shall be deemed not to have been issued for purposes of determining the maximum number of Shares that may be issued pursuant to all Awards under the Plan, unless otherwise determined by the Administrator.  

4.

Administration of the Plan .

(a)

Plan Administrator .  

(i)

Administration with Respect to Directors and Officers .

    With respect to grants of Awards to Directors or Employees who are also Officers or Directors of the Company, the Plan shall be administered by (A) the Board or (B) a Committee designated by the Board, which Committee shall be constituted in such a manner as to satisfy the Applicable Laws and to permit such grants and related transactions under the Plan to be exempt from Section 16(b) of the Exchange Act in accordance with Rule 16b-3.  Once appointed, such Committee shall continue to serve in its designated capacity until otherwise directed by the Board.  

(ii)

Administration With Respect to Consultants and Other Employees .

With respect to grants of Awards to Employees or Consultants who are neither Directors nor Officers of the Company, the Plan shall be administered by (A) the Board or (B) a Committee designated by the Board, which Committee shall be constituted in such a manner as to satisfy the Applicable Laws.  Once appointed, such Committee shall continue to serve in its designated capacity until otherwise directed by the Board.  The Board may authorize one or more Officers to grant such Awards and may limit such authority as the Board determines from time to time.

(iii)

Administration With Respect to Covered Employees .  Notwithstanding the foregoing, as of and after the date that the exemption for the Plan under Section 162(m) of the Code expires, as set forth in Section 18 below, grants of Awards to any Covered Employee intended to qualify as Performance-Based Compensation shall be made only by a Committee (or subcommittee of a Committee) that is comprised solely of two or more Directors eligible to serve on a committee making Awards qualifying as Performance-Based Compensation.  In the case of such Awards granted to Covered Employees, references to the “ Administrator ” or to a “ Committee ” shall be deemed to be references to such Committee or subcommittee.



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(iv)

Administration Errors .

In the event an Award is granted in a manner inconsistent with the provisions of this subsection (a) , such Award shall be presumptively valid as of its grant date to the extent permitted by the Applicable Laws.  

(b)

Powers of the Administrator .

Subject to Applicable Laws and the provisions of the Plan (including any other powers given to the Administrator hereunder), and except as otherwise provided by the Board, the Administrator shall have the authority, in its discretion:

(i)

to select the Employees, Directors and Consultants to whom Awards may be granted from time to time hereunder;

(ii)

to determine whether and to what extent Awards are granted hereunder;

(iii)

to determine the number of Shares or the amount of other consideration to be covered by each Award granted hereunder;

(iv)

to approve forms of Award Agreements for use under the Plan;

(v)

to determine the terms and conditions of any Award granted hereunder;

(vi)

to amend the terms of any outstanding Award granted under the Plan, provided that

(A)

any amendment that would adversely affect the Grantee’s rights under an outstanding Award shall not be made without the Grantee’s written consent, provided , however , that an amendment or modification that may cause an Incentive Stock Option to become a Non-Qualified Stock Option shall not be treated as adversely affecting the rights of the Grantee;

(B)

the reduction of the exercise price of any Option awarded under the Plan and the base appreciation amount of any SAR awarded under the Plan shall be subject to stockholder approval; and

(C)

canceling an Option or SAR at a time when its exercise price or base appreciation amount (as applicable) exceeds the Fair Market Value of the underlying Shares, in exchange for another Option, SAR, Restricted Stock, or other Award or for cash shall be subject to stockholder approval, unless the cancellation and exchange occurs in connection with a Corporate Transaction.  Notwithstanding the foregoing, canceling an Option or SAR in exchange for another Option, SAR, Restricted Stock, or other Award or for cash with an exercise price, purchase price or base appreciation amount (as applicable) that is equal to or greater than the exercise price or base appreciation amount (as applicable) of the original Option or SAR shall not be subject to stockholder approval;

(vii)

to construe and interpret the terms of the Plan and Awards, including without limitation, any notice of award or Award Agreement, granted pursuant to the Plan;

(viii)

to grant Awards to Employees, Directors and Consultants employed outside the United States on such terms and conditions different from those specified in the Plan as may, in the judgment of the Administrator, be necessary or desirable to further the purpose of the Plan; and

(ix)

to take such other action, not inconsistent with the terms of the Plan, as the Administrator deems appropriate.

The express grant in the Plan of any specific power to the Administrator shall not be construed as limiting any power or authority of the Administrator; provided that the Administrator may not exercise any right or power reserved to the Board.  Any decision made, or action taken, by the Administrator or in connection with the administration of this Plan shall be final, conclusive and binding on all persons having an interest in the Plan.



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(c)

Indemnification .

In addition to such other rights of indemnification as they may have as members of the Board or as Officers or Employees of the Company or a Related Entity, members of the Board and any Officers or Employees of the Company or a Related Entity to whom authority to act for the Board, the Administrator or the Company is delegated shall be defended and indemnified by the Company to the extent permitted by law on an after-tax basis against all reasonable expenses, including attorneys’ fees, actually and necessarily incurred in connection with the defense of any claim, investigation, action, suit or proceeding, or in connection with any appeal therein, to which they or any of them may be a party by reason of any action taken or failure to act under or in connection with the Plan, or any Award granted hereunder, and against all amounts paid by them in settlement thereof (provided such settlement is approved by the Company) or paid by them in satisfaction of a judgment in any such claim, investigation, action, suit or proceeding, except in relation to matters as to which it shall be adjudged in such claim, investigation, action, suit or proceeding that such person is liable for gross negligence, bad faith or intentional misconduct; provided, however, that within 30 days after the institution of such claim, investigation, action, suit or proceeding, such person shall offer to the Company, in writing, the opportunity at the Company’s expense to defend the same.

5.

Eligibility .

Awards other than Incentive Stock Options may be granted to Employees, Directors and Consultants.  Incentive Stock Options may be granted only to Employees of the Company or a Parent or a Subsidiary of the Company.  An Employee, Director or Consultant, who has been granted an Award may, if otherwise eligible, be granted additional Awards.  Awards may be granted to such Employees, Directors or Consultants who are residing in non-U.S. jurisdictions as the Administrator may determine from time to time.

6.

Terms and Conditions of Awards .

(a)

Types of Awards .

The Administrator is authorized under the Plan to award any type of arrangement to an Employee, Director or Consultant that is not inconsistent with the provisions of the Plan and that by its terms involves or might involve the issuance of (i) Shares; (ii) cash; (iii) an Option; (iv) a SAR; or (v) a similar right with a fixed or variable price related to the Fair Market Value of the Shares and with an exercise or conversion privilege related to the passage of time, the occurrence of one or more events, or the satisfaction of performance criteria or other conditions.  Such awards include, without limitation, Options, SARs, sales or bonuses of Restricted Stock, Restricted Stock Units or Dividend Equivalent Rights, and an Award may consist of one such security or benefit, or two or more of them in any combination or alternative.

(b)

Designation of Award .

Each Award shall be designated in the Award Agreement.  In the case of an Option, the Option shall be designated as either an Incentive Stock Option or a Non-Qualified Stock Option.  However, notwithstanding such designation, an Option will qualify as an Incentive Stock Option under the Code only to the extent the $100,000 limitation of Section 422(d) of the Code is not exceeded.  The $100,000 limitation of Section 422(d) of the Code is calculated based on the aggregate Fair Market Value of the Shares subject to Options designated as Incentive Stock Options that become exercisable for the first time by a Grantee during any calendar year (under all plans of the Company or any Parent or Subsidiary of the Company).  For purposes of this calculation, Incentive Stock Options shall be taken into account in the order in which they were granted, and the Fair Market Value of the Shares shall be determined as of the grant date of the relevant Option.  In the event that the Code or the regulations promulgated thereunder are amended after the date the Plan becomes effective to provide for a different limit on the Fair Market Value of Shares permitted to be subject to Incentive Stock Options, then such different limit will be automatically incorporated herein and will apply to any Options granted after the effective date of such amendment.

(c)

Conditions of Award .

Subject to the terms of the Plan, the Administrator shall determine the provisions, terms, and conditions of each Award including, but not limited to, the Award vesting schedule, repurchase provisions, rights of first refusal, forfeiture provisions, form of payment (cash, Shares, or other consideration) upon settlement of the Award, payment contingencies, and satisfaction of any performance criteria.  The performance criteria established by the Administrator may be based on any one of, or combination of, the following:  (i) increase in share price; (ii) earnings per share; (iii) total stockholder return; (iv) operating margin; (v) gross margin; (vi) return on equity; (vii) return on assets; (viii) return on investment; (ix) operating income; (x) net operating income; (xi) pre-tax profit; (xii) cash flow; (xiii) revenue; (xiv) expenses; (xv) earnings before interest, taxes and depreciation; (xvi) economic value added; and (xvii) market share.  The performance criteria may be applicable to the Company, Related Entities and/or any individual business units of the Company or any Related



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Entity.  Partial achievement of the specified criteria may result in a payment or vesting corresponding to the degree of achievement as specified in the Award Agreement.  In addition, the performance criteria shall be calculated in accordance with generally accepted accounting principles, but excluding the effect (whether positive or negative) of any change in accounting standards and any extraordinary, unusual or nonrecurring item, as determined by the Administrator, occurring after the establishment of the performance criteria applicable to the Award intended to be performance-based compensation.  Each such adjustment, if any, shall be made solely for the purpose of providing a consistent basis from period to period for the calculation of performance criteria in order to prevent the dilution or enlargement of the Grantee’s rights with respect to an Award intended to be performance-based compensation.

(d)

Acquisitions and Other Transactions .

The Administrator may issue Awards under the Plan in settlement, assumption or substitution for, outstanding awards or obligations to grant future awards in connection with the Company or a Related Entity acquiring another entity, an interest in another entity or an additional interest in a Related Entity whether by merger, stock purchase, asset purchase or other form of transaction.  

(e)

Deferral of Award Payment .

The Administrator may establish one or more programs under the Plan to permit selected Grantees the opportunity to elect to defer receipt of consideration upon exercise of an Award, satisfaction of performance criteria, or other event that absent the election would entitle the Grantee to payment or receipt of Shares or other consideration under an Award.  The Administrator may establish the election procedures, the timing of such elections, the mechanisms for payments of, and accrual of interest or other earnings, if any, on amounts, Shares or other consideration so deferred, and such other terms, conditions, rules and procedures that the Administrator deems advisable for the administration of any such deferral program.

(f)

Separate Programs .

The Administrator may establish one or more separate programs under the Plan for the purpose of issuing particular forms of Awards to one or more classes of Grantees on such terms and conditions as determined by the Administrator from time to time.  

(g)

Individual Limitations on Awards .  

(i)

Individual Limit for Options and SARs .

  Following the date that the exemption from application of Section 162(m) of the Code described in Section 18 (or any exemption having similar effect) ceases to apply to Awards, the maximum number of Shares with respect to which Options and SARs may be granted to any Grantee in any calendar year shall be 100,000 Shares.  In connection with a Grantee’s commencement of Continuous Service, a Grantee may be granted Options and SARs for up to an additional 150,000 Shares that shall not count against the limit set forth in the previous sentence. The foregoing limitations shall be adjusted proportionately in connection with any change in the Company’s capitalization pursuant to Section 10 , below.  To the extent required by Section 162(m) of the Code or the regulations thereunder, in applying the foregoing limitations with respect to a Grantee, if any Option or SAR is canceled, the canceled Option or SAR shall continue to count against the maximum number of Shares with respect to which Options and SARs may be granted to the Grantee.  For this purpose, the repricing of an Option (or in the case of a SAR, the base amount on which the stock appreciation is calculated is reduced to reflect a reduction in the Fair Market Value of the Common Stock) shall be treated as the cancellation of the existing Option or SAR and the grant of a new Option or SAR.

(ii)

Individual Limit for Restricted Stock and Restricted Stock Units .

Following the date that the exemption from application of Section 162(m) of the Code described in Section 18 (or any exemption having similar effect) ceases to apply to Awards, for awards of Restricted Stock and Restricted Stock Units that are intended to be Performance-Based Compensation, the maximum number of Shares with respect to which such Awards may be granted to any Grantee in any calendar year shall be 250,000 Shares.  The foregoing limitation shall be adjusted proportionately in connection with any change in the Company’s capitalization pursuant to Section 10 .  

(h)

Deferral .

If the vesting or receipt of Shares under an Award is deferred to a later date, any amount (whether denominated in Shares or cash) paid in addition to the original number of Shares subject to such Award will not be treated as an increase in the number of Shares subject to the Award if the additional amount is based either on a reasonable rate of interest or on one or more predetermined actual investments such that



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the amount payable by the Company at the later date will be based on the actual rate of return of a specific investment (including any decrease as well as any increase in the value of an investment).

(i)

Early Exercise .

The Award Agreement may, but need not, include a provision whereby the Grantee may elect at any time while an Employee, Director or Consultant to exercise any part or all of the Award prior to full vesting of the Award.  Any unvested Shares received pursuant to such exercise may be subject to a repurchase right in favor of the Company or a Related Entity or to any other restriction the Administrator determines to be appropriate.  

(j)

Term of Award .

The term of each Award shall be the term stated in the Award Agreement, provided, however, that the term of an Award shall be no more than ten years from the date of grant thereof.  However, in the case of an Incentive Stock Option granted to a Grantee who, at the time the Option is granted, owns stock representing more than ten percent (10%) of the voting power of all classes of stock of the Company or any Parent or Subsidiary of the Company, the term of the Incentive Stock Option shall be five (5) years from the date of grant thereof or such shorter term as may be provided in the Award Agreement.  Notwithstanding the foregoing, the specified term of any Award shall not include any period for which the Grantee has elected to defer the receipt of the Shares or cash issuable pursuant to the Award.

(k)

Transferability of Awards .

Incentive Stock Options may not be sold, pledged, assigned, hypothecated, transferred, or disposed of in any manner other than by will or by the laws of descent or distribution and may be exercised, during the lifetime of the Grantee, only by the Grantee.  Other Awards shall be transferable (i) by will and by the laws of descent and distribution and (ii) during the lifetime of the Grantee, to the extent and in the manner authorized by the Administrator but only to the extent such transfers are made to family members, to family trusts, to family controlled entities, to charitable organizations, and pursuant to domestic relations orders or agreements, in all cases without payment for such transfers to the Grantee.  Notwithstanding the foregoing, the Grantee may designate one or more beneficiaries of the Grantee’s Award in the event of the Grantee’s death on a beneficiary designation form provided by the Administrator.  

(l)

Time of Granting Awards .

The date of grant of an Award shall for all purposes be the date on which the Administrator makes the determination to grant such Award, or such other later date as is determined by the Administrator.

7.

Award Exercise or Purchase Price, Consideration and Taxes .

(a)

Exercise or Purchase Price .

The exercise or purchase price, if any, for an Award shall be as follows:

(i)

In the case of an Incentive Stock Option:

(A)

granted to an Employee who, at the time of the grant of such Incentive Stock Option owns stock representing more than ten percent (10%) of the voting power of all classes of stock of the Company or any Parent or Subsidiary of the Company, the per Share exercise price shall be not less than one hundred ten percent (110%) of the Fair Market Value per Share on the date of grant; or

(B)

granted to any Employee other than an Employee described in the preceding paragraph, the per Share exercise price shall be not less than one hundred percent (100%) of the Fair Market Value per Share on the date of grant.

(ii)

In the case of a Non-Qualified Stock Option, the per Share exercise price shall be not less than one hundred percent (100%) of the Fair Market Value per Share on the date of grant.

(iii)

In the case of Awards intended to qualify as Performance-Based Compensation, the exercise or purchase price, if any, shall be not less than one hundred percent (100%) of the Fair Market Value per Share on the date of grant.



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(iv)

In the case of SARs, the base appreciation amount shall not be less than one hundred percent (100%) of the Fair Market Value per Share on the date of grant.

(v)

In the case of other Awards, such price as is determined by the Administrator.

(vi)

Notwithstanding the foregoing provisions of this Section 7(a) , in the case of an Award issued pursuant to Section 6(d) , above, the exercise or purchase price for the Award shall be determined in accordance with the provisions of the relevant instrument evidencing the agreement to issue such Award.

(b)

Consideration .

Subject to Applicable Laws, the consideration to be paid for the Shares to be issued upon exercise or purchase of an Award including the method of payment shall be determined by the Administrator.  In addition to any other types of consideration the Administrator may determine, the Administrator is authorized to accept as consideration for Shares issued under the Plan the following, provided that the portion of the consideration equal to the par value of the Shares must be paid in cash or other legal consideration permitted by the Nevada Business Corporations Law:

(i)

cash;

(ii)

check;

(iii)

surrender of Shares, or delivery of a properly executed form of attestation of ownership of Shares as the Administrator may require, that have a Fair Market Value on the date of surrender or attestation equal to the aggregate exercise price of the Shares as to which said Award shall be exercised;

(iv)

with respect to Options, if the exercise occurs on or after the Registration Date, payment through a broker-dealer sale and remittance procedure pursuant to which the Grantee (A) shall provide written instructions to a Company designated brokerage firm to effect the immediate sale of some or all of the purchased Shares and remit to the Company sufficient funds to cover the aggregate exercise price payable for the purchased Shares and (B) shall provide written directives to the Company to deliver the certificates for the purchased Shares directly to such brokerage firm in order to complete the sale transaction;

(v)

with respect to Options, payment through a “ net exercise ” such that, without the payment of any funds, the Grantee may exercise the Option and receive the net number of Shares equal to the number of Shares as to which the Option is being exercised, multiplied by (A) a fraction, the numerator of which is the Fair Market Value per Share (on such date as is determined by the Administrator) less the exercise price per Share, and (B) the denominator of which is such Fair Market Value per Share (the number of net Shares to be received shall be rounded down to the nearest whole number of Shares); or

(vi)

any combination of the foregoing methods of payment.

The Administrator may at any time or from time to time, by adoption of or by amendment to the standard forms of Award Agreement described in Section 4(b) (iv) , or by other means, grant Awards that do not permit all of the foregoing forms of consideration to be used in payment for the Shares or that otherwise restrict one or more forms of consideration.

(c)

Taxes .

No Shares shall be delivered under the Plan to any Grantee or other person until such Grantee or other person has made arrangements acceptable to the Administrator for the satisfaction of any non-U.S., federal, state, or local income and employment tax withholding obligations, including, without limitation, obligations incident to the receipt of Shares.  Upon exercise or vesting of an Award the Company shall withhold or collect from the Grantee an amount sufficient to satisfy such tax obligations, including, but not limited to, by surrender of the whole number of Shares covered by the Award sufficient to satisfy the minimum applicable tax withholding obligations incident to the exercise or vesting of an Award (reduced to the lowest whole number of Shares if such number of Shares withheld would result in withholding a fractional Share with any remaining tax withholding settled in cash).



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8.

Exercise of Award .

(a)

Procedure for Exercise; Rights as a Stockholder .  

(i)

Any Award granted hereunder shall be exercisable at such times and under such conditions as determined by the Administrator under the terms of the Plan and specified in the Award Agreement.

(ii)

An Award shall be deemed to be exercised when written notice of such exercise has been given to the Company in accordance with the terms of the Award by the person entitled to exercise the Award and full payment for the Shares with respect to which the Award is exercised has been made, including, to the extent selected, use of the broker-dealer sale and remittance procedure to pay the purchase price as provided in Section 7(b) (iv) .  

(b)

Exercise of Award Following Termination of Continuous Service .  In the event of termination of a Grantee’s Continuous Service for any reason other than Disability or death (but not in the event of a Grantee’s change of status from Employee to Consultant or from Consultant to Employee), such Grantee may, but only during the post-termination exercise period (but in no event later than the expiration date of the term of such Award as set forth in the Award Agreement), exercise the portion of the Grantee’s Award that was vested at the date of such termination or such other portion of the Grantee’s Award as may be determined by the Administrator.  Unless otherwise provided in the Grantee’s Award Agreement or as determined in writing by the Committee or the Board, the Grantee’s right to exercise the Award shall terminate concurrently with the termination of Grantee’s Continuous Service, if Grantee’s Continuous Service is terminated for Cause and three months and one day after the termination of the Grantee’s Continuous Service, if Grantee’s Continuous Service is terminated without Cause.  In the event of a Grantee’s change of status from Employee to Consultant, an Employee’s Incentive Stock Option shall convert automatically to a Non-Qualified Stock Option on the day three months and one day following such change of status.  To the extent that the Grantee’s Award was unvested at the date of termination, or if the Grantee does not exercise the vested portion of the Grantee’s Award within the post-termination exercise period, the Award shall terminate.

(c)

Disability of Grantee .

In the event of termination of a Grantee’s Continuous Service as a result of his or her Disability, such Grantee may, but only within six months from the date of such termination (or such longer period as specified in the Award Agreement but in no event later than the expiration date of the term of such Award as set forth in the Award Agreement), exercise the portion of the Grantee’s Award that was vested at the date of such termination; provided, however, that if such Disability is not a “disability” as such term is defined in Section 22(e)(3) of the Code, in the case of an Incentive Stock Option such Incentive Stock Option shall automatically convert to a Non-Qualified Stock Option on the day three months and one day following such termination.  To the extent that the Grantee’s Award was unvested at the date of termination, or if Grantee does not exercise the vested portion of the Grantee’s Award within the time specified herein, the Award shall terminate.

(d)

Death of Grantee .

In the event of a termination of the Grantee’s Continuous Service as a result of his or her death, or in the event of the death of the Grantee during the post-termination exercise period or during the six month period following the Grantee’s termination of Continuous Service as a result of his or her Disability, the Grantee’s estate or a person who acquired the right to exercise the Award by bequest or inheritance may exercise the portion of the Grantee’s Award that was vested as of the date of termination, within six months from the date of death (or such longer period as specified in the Award Agreement but in no event later than the expiration of the term of such Award as set forth in the Award Agreement).  To the extent that, at the time of death, the Grantee’s Award was unvested, or if the Grantee’s estate or a person who acquired the right to exercise the Award by bequest or inheritance does not exercise the vested portion of the Grantee’s Award within the time specified herein, the Award shall terminate.  

(e)

Extension if Exercise Prevented by Law .  Notwithstanding the foregoing, if the exercise of an Award within the applicable time periods set forth in this Section 8 is prevented by the provisions of Section 9 below, the Award shall remain exercisable until one month after the date the Grantee is notified by the Company that the Award is exercisable, but in any event no later than the expiration of the term of such Award as set forth in the Award Agreement and only in a manner and to the extent permitted under Code Section 409A.



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9.

Conditions Upon Issuance of Shares .

(a)

If at any time the Administrator determines that the delivery of Shares pursuant to the exercise, vesting or any other provision of an Award is or may be unlawful under Applicable Laws, the vesting or right to exercise an Award or to otherwise receive Shares pursuant to the terms of an Award shall be suspended until the Administrator determines that such delivery is lawful and shall be further subject to the approval of counsel for the Company with respect to such compliance.  The Company shall have no obligation to effect any registration or qualification of the Shares under federal or state laws.

(b)

As a condition to the exercise of an Award, the Company may require the person exercising such Award to represent and warrant at the time of any such exercise that the Shares are being purchased only for investment and without any present intention to sell or distribute such Shares if, in the opinion of counsel for the Company, such a representation is required by any Applicable Laws.

10.

Adjustments Upon Changes in Capitalization .

Subject to any required action by the stockholders of the Company and Section 11 hereof, the number of Shares covered by each outstanding Award, and the number of Shares that have been authorized for issuance under the Plan but as to which no Awards have yet been granted or that have been returned to the Plan, the exercise or purchase price of each such outstanding Award, the maximum number of Shares with respect to which Awards may be granted to any Grantee in any calendar year, as well as any other terms that the Administrator determines require adjustment shall be proportionately adjusted for (i) any increase or decrease in the number of issued Shares resulting from a stock split, reverse stock split, stock dividend, recapitalization, combination or reclassification of the Shares, or similar transaction affecting the Shares; (ii) any other increase or decrease in the number of issued Shares effected without receipt of consideration by the Company; or (iii)  any other transaction with respect to Common Stock including a corporate merger, consolidation, acquisition of property or stock, separation (including a spin-off or other distribution of stock or property), reorganization, liquidation (whether partial or complete) or any similar transaction; provided , however that conversion of any convertible securities of the Company shall not be deemed to have been “effected without receipt of consideration.”  In the event of any distribution of cash or other assets to stockholders other than a normal cash dividend, the Administrator shall also make such adjustments as provided in this Section 10 or substitute, exchange or grant Awards to effect such adjustments (collectively “ adjustments ”).  Any such adjustments to outstanding Awards will be effected in a manner that precludes the enlargement of rights and benefits under such Awards.  In connection with the foregoing adjustments, the Administrator may, in its discretion, prohibit the exercise of Awards or other issuance of Shares, cash or other consideration pursuant to Awards during certain periods of time. Except as the Administrator determines, no issuance by the Company of shares of any class, or securities convertible into shares of any class, shall affect, and no adjustment by reason hereof shall be made with respect to, the number or price of Shares subject to an Award.

11.

Corporate Transactions and Changes in Control .

(a)

Termination of Award to Extent Not Assumed in Corporate Transaction .

Effective upon the consummation of a Corporate Transaction, all outstanding Awards under the Plan shall terminate.  However, all such Awards shall not terminate to the extent they are Assumed in connection with the Corporate Transaction.

(b)

Acceleration of Award Upon Corporate Transaction or Change in Control .

The Administrator shall have the authority, exercisable either in advance of any actual or anticipated Corporate Transaction or Change in Control or at the time of an actual Corporate Transaction or Change in Control and exercisable at the time of the grant of an Award under the Plan or any time while an Award remains outstanding, to provide for the full or partial automatic vesting and exercisability of one or more outstanding unvested Awards under the Plan and the release from restrictions on transfer and repurchase or forfeiture rights of such Awards in connection with a Corporate Transaction or Change in Control, on such terms and conditions as the Administrator may specify.  The Administrator also shall have the authority to condition any such Award vesting and exercisability or release from such limitations upon the subsequent termination of the Continuous Service of the Grantee within a specified period following the effective date of the Corporate Transaction or Change in Control.  The Administrator may provide that any Awards so vested or released from such limitations in connection with a Change in Control, shall remain fully exercisable until the expiration or sooner termination of the Award.



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(c)

Effect of Acceleration on Incentive Stock Options .

Any Incentive Stock Option accelerated under this Section 11 in connection with a Corporate Transaction or Change in Control shall remain exercisable as an Incentive Stock Option under the Code only to the extent the $100,000 dollar limitation of Section 422(d) of the Code is not exceeded.  

12.

Effective Date and Term of Plan .

The Plan shall become effective upon the earlier to occur of its adoption by the Board or its approval by the stockholders of the Company.  It shall continue in effect for a term of ten years unless sooner terminated.  Subject to Section 17 , below, and Applicable Laws, Awards may be granted under the Plan upon its becoming effective.

13.

Amendment, Suspension or Termination of the Plan .

(a)

The Board may at any time amend, suspend or terminate the Plan; provided, however, that no such amendment shall be made without the approval of the Company’s stockholders to the extent such approval is required by Applicable Laws.

(b)

No Award may be granted during any suspension of the Plan or after termination of the Plan.

(c)

No suspension or termination of the Plan (including termination of the Plan under Section 11 , above) shall adversely affect any rights under Awards already granted to a Grantee.

14.

Reservation of Shares .

(a)

The Company, during the term of the Plan, will at all times reserve and keep available such number of Shares as shall be sufficient to satisfy the requirements of the Plan.

(b)

The inability of the Company to obtain authority from any regulatory body having jurisdiction, which authority is deemed by the Company’s counsel to be necessary to the lawful issuance and sale of any Shares hereunder, shall relieve the Company of any liability in respect of the failure to issue or sell such Shares as to which such requisite authority shall not have been obtained.

15.

No Effect on Terms of Employment/Consulting Relationship .

The Plan shall not confer upon any Grantee any right with respect to the Grantee’s Continuous Service, nor shall it interfere in any way with his or her right or the right of the Company or any Related Entity to terminate the Grantee’s Continuous Service at any time, with or without cause, including, but not limited to, Cause, and with or without notice.  The ability of the Company or any Related Entity to terminate the employment of a Grantee who is employed at will is in no way affected by its determination that the Grantee’s Continuous Service has been terminated for Cause for the purposes of this Plan.

16.

No Effect on Retirement and Other Benefit Plans .

Except as specifically provided in a retirement or other benefit plan of the Company or a Related Entity, Awards shall not be deemed compensation for purposes of computing benefits or contributions under any retirement plan of the Company or a Related Entity, and shall not affect any benefits under any other benefit plan of any kind or any benefit plan subsequently instituted under which the availability or amount of benefits is related to level of compensation.  The Plan is not a “Pension Plan” or “Welfare Plan” under the Employee Retirement Income Security Act of 1974, as amended.

17.

Stockholder Approval .

The grant of Incentive Stock Options under the Plan shall be subject to approval of the Plan by the stockholders of the Company within twelve (12) months before or after the date the Plan is adopted excluding Incentive Stock Options issued in substitution for outstanding Incentive Stock Options pursuant to Section 424(a) of the Code.  Such stockholder approval shall be obtained in the degree and manner required under Applicable Laws.  The Administrator may grant Incentive Stock Options under the Plan prior to approval by the stockholders, but until such approval is obtained, no such Incentive Stock Option shall be exercisable.  In the event that stockholder approval is not obtained within the twelve (12) month period provided



14 | Page




above, all Incentive Stock Options previously granted under the Plan shall be exercisable as Non-Qualified Stock Options.

18.

Effect of Section 162(m) of the Code .

Section 162(m) of the Code does not apply to the Plan prior to the Registration Date.  Following the Registration Date, the Plan, and all Awards issued thereunder, are intended to be exempt from the application of Section 162(m) of the Code, which restricts under certain circumstances the Federal income tax deduction for compensation paid by a public company to named executives in excess of $1 million per year.  The exemption is based on Treasury Regulation Section 1.162-27 (f), in the form existing on the effective date of the Plan, with the understanding that such regulation generally exempts from the application of Section 162(m) of the Code compensation paid pursuant to a plan that existed before a company becomes publicly held.  Under such Treasury Regulation, this exemption is available to the Plan for the duration of the period that lasts until the earlier of (i) the expiration of the Plan; (ii) the material modification of the Plan; (iii) the exhaustion of the maximum number of shares of Common Stock available for Awards under the Plan, as set forth in Section (a) ; (iv) the first meeting of stockholders at which Directors are to be elected that occurs after the close of the third calendar year following the calendar year in which the Company first becomes subject to the reporting obligations of Section 13 or 15(d) of the Exchange Act; or (v) such other date required by Section 162(m) of the Code and the rules and regulations promulgated thereunder.  To the extent that the Administrator determines as of the date of grant of an Award that (i) the Award is intended to qualify as Performance-Based Compensation; and (ii) the exemption described above is no longer available with respect to such Award, such Award shall not be effective until any stockholder approval required under Section 162(m) of the Code has been obtained.

19.

Unfunded Obligation .

Grantees shall have the status of general unsecured creditors of the Company.  Any amounts payable to Grantees pursuant to the Plan shall be unfunded and unsecured obligations for all purposes, including, without limitation, Title I of the Employee Retirement Income Security Act of 1974, as amended.  Neither the Company nor any Related Entity shall be required to segregate any monies from its general funds, or to create any trusts, or establish any special accounts with respect to such obligations.  The Company shall retain at all times beneficial ownership of any investments, including trust investments, which the Company may make to fulfill its payment obligations hereunder.  Any investments or the creation or maintenance of any trust or any Grantee account shall not create or constitute a trust or fiduciary relationship between the Administrator, the Company or any Related Entity and a Grantee, or otherwise create any vested or beneficial interest in any Grantee or the Grantee’s creditors in any assets of the Company or a Related Entity. The Grantees shall have no claim against the Company or any Related Entity for any changes in the value of any assets that may be invested or reinvested by the Company with respect to the Plan.

20.

Construction .

Captions and titles contained herein are for convenience only and shall not affect the meaning or interpretation of any provision of the Plan.  Except when otherwise indicated by the context, the singular shall include the plural and the plural shall include the singular.  Use of the term “ or ” is not intended to be exclusive, unless the context clearly requires otherwise.

21.

Nonexclusivity of the Plan .

Neither the adoption of the Plan by the Board, the submission of the Plan to the stockholders of the Company for approval, nor any provision of the Plan will be construed as creating any limitations on the power of the Board to adopt such additional compensation arrangements as it may deem desirable, including, without limitation, the granting of Awards otherwise than under the Plan, and such arrangements may be either generally applicable or applicable only in specific cases.



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Exhibit 10.2



DIRECT OFFERING SUBSCRIPTION AGREEMENT


The undersigned (the “ Subscriber ”), desires to become a holder of shares of common stock (the “ Shares” ) of ALPHA INVESTMENT, INC. , a Delaware corporation (the “ Company” ), having its principal place of business located at 200 East Campus View Blvd., Suite 200, Columbus, OH 43235.


Accordingly, the Subscriber hereby agrees as follows:


1.

Subscription .


1.1

The Subscriber hereby subscribes for and agrees to accept from the Company that number of Shares set forth in Section 10 of this Subscription Agreement (the “Agreement”), in consideration of $15.00 per Share.  This offer to purchase is submitted in accordance with and subject to the terms and conditions described in this Agreement. The Subscriber acknowledges that the Company reserves the right, in its sole and absolute discretion, to accept or reject this subscription and the subscription will not be binding until accepted by the Company in writing.


1.2

The closing of the subscription (the “Closing”) shall occur immediately upon: (a) receipt and acceptance by the Company of a properly completed and executed Agreement; and (b) receipt of all funds for the subscription of Shares hereunder.


2.

Purchase Procedure .   The Subscriber acknowledges that, in order to subscribe for Shares, Subscriber shall deliver to the Company the full purchase price for the Shares subscribed for in the amount set forth in Section 10 , either by cashier’s check made payable to the Company or by wire transfer of immediately available funds in accordance with wire transfer instructions provided by the Company.


3.

Representations and Acknowledgements of Subscriber .   By executing this Agreement, the Subscriber makes the following representations, declarations, acknowledgements and warranties to the Company, with the intent and understanding that the Company will rely thereon:


3.1

Such Subscriber acknowledges the public availability of the Company's current prospectus (the " Prospectus "). This Prospectus is made available in the Company's Registration Statement on Form S-1 (File No. 333-       ), declared effective by the Securities and Exchange Commission on __________ __, 201_. This Prospectus sets forth the terms and conditions of the offering of Shares (the “ Offering ”) and the risks associated therewith are described.


3.2

All information herein concerning the Subscriber is correct and complete as of the date hereof and as of the date of Closing.


3.3

If the Subscriber is purchasing the Shares in a fiduciary capacity for another person or entity, including without limitation a corporation, partnership, trust or any other entity, the Subscriber has been duly authorized and empowered to execute this Subscription Agreement and all other subscription documents.  Upon request of the Company, the Subscriber will provide true, complete and current copies of all relevant documents creating the Subscriber, authorizing its investment in the Company and/or evidencing the satisfaction of the foregoing.


3.4

In connection with the Offering, the Company intends to seek a listing of its common stock on a securities exchange registered with the Securities and Exchange Commission (SEC) under Section 6(a) of the Securities Exchange Act of 1934, as amended, such as the NASDAQ Capital Market (the act of achieving such listing or quotation, generally referred to hereafter as a “Public Listing”), but there can be no assurance that the Company will ever achieve a Public Listing (See Risk Factors – Risks Related to the Offering in the Prospectus). The Subscriber understands that until such time as




the Company achieves a Public Listing of its Shares, a public market for the Shares may be extremely limited and sporadic or may not exist at all and it may be difficult to sell the Shares purchased in the Offering.  No U.S. federal or state agency has made any finding or determination as to the fairness of the terms of the Offering. These securities have not been recommended or endorsed by any U.S. federal or state securities commission or regulatory agency.


4.

Governing Law .   This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, without regard to principles of conflicts of law.


5.

Counterparts; Severability .   This Agreement may be executed in one or more counterparts.   If any provision of this Agreement shall be held invalid or unenforceable in any jurisdiction, such invalidity or unenforceability shall not affect the validity or enforceability of the remainder of this Agreement or the validity or enforceability of this Subscription Agreement in any other jurisdiction.


6.

Persons Bound .   This Agreement shall, except as otherwise provided herein, inure to the benefit of and be binding on the Company and its successors and assigns and on each Subscriber and his, her or its respective heirs, legal representatives and successors and assigns, as the case may be.


7.

Section Headings .

The section headings contained in this Agreement are inserted for purposes of convenience of reference only and shall not affect the meaning or interpretation of this Agreement.


8.

Notices .   Any notice or other communication required or permitted hereunder shall be in writing and shall be delivered personally or sent by national recognized overnight courier, to the address of each party set forth in this Agreement.


9.

CERTIFICATION .    THE SUBSCRIBER CERTIFIES THAT SUBSCRIBER HAS READ THIS ENTIRE SUBSCRIPTION AGREEMENT AND THAT EVERY STATEMENT MADE BY THE SUBSCRIBER HEREIN IS TRUE AND COMPLETE.


10.

Ownership Information .

Please print here the number of Shares to be purchased, the Purchase Price and the exact name(s) in which the Shares will be registered.


Number of Shares Purchased:

 


Purchase Price @ $15.00 per Share:  $

 


Purchaser Name(s):

 

 

 

 

 

 

 


_____Single Person


_____Husband and Wife, as community property


_____Joint Tenants (with right of survivorship)


_____Tenants in Common


_____Corporation or other organization


_____A Partnership


_____IRA


_____Tax-Qualified Retirement Plan





_____Trust


(i)

Trustee(s)/Custodian

 


(ii)

Trust Date

 


(iii)

Name of Trust

 


(iv)

For the Benefit of:

 


_____  Other:



(Please explain)


Social Security or Tax I.D.:

 



Street Address (If P.O. Box, include address for surface delivery if different than residence)



City

State

Zip Code



Email address


Telephone Numbers:


Home:

                             (             )


Cell:

                                 (             )









[Signature Pages Follow]













Subscriber Signature Page

 

The undersigned, desiring to subscribe for the number of Shares of the Company as is set forth above, acknowledges that he/she has received and understands the terms and conditions of the Subscription Agreement attached hereto and that he/she does hereby agree to all the terms and conditions contained therein.

 

IN WITNESS WHEREOF , the undersigned has hereby executed this Subscription Agreement as of the date set forth below.


Date and Signatures .

 

Dated:  _________________ 201___

 

 

 

Signature(s)

 

Print Purchaser Name (s)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 








(Each co-owner or joint owner must sign – names must be signed exactly as listed under “ Purchaser Name(s) ”)





Company Counterpart Signature Page


ACCEPTED:


ALPHA INVESTMENT INC.



By:

 

 

Dated:  ___________________, 201_

 

Name:

 

 

 

Title

 

 





Exhibit 10.4



ALPHA INVESTMENT INC.

$2,500,000 SUBSCRIPTION AGREEMENT


Alpha Investment Inc.

200 Campus View Suite 200

Columbus, OH 43235


Ladies and Gentlemen:


Hoosier Real Estate Investors, LLC (“ Purchaser ”) and Alpha Investment Inc. a Delaware corporation (the “ Company ”) hereby agree as follows:


1.

Sale and Purchase .

Purchaser hereby purchases from the Company and the Company hereby agrees to sell to Purchaser 166,667 shares of its restricted common stock (the “ Shares ”) at a purchase price of $2,500,000 (the “ Purchase Price ”).  The Purchase Price shall be payable contemporaneously with the execution of this subscription agreement (the “ Subscription Agreement ”) by wire transfer in immediately available funds to the to the account designated by the Escrow Agent (as hereinafter defined). The Shares are being offered and sold to Purchaser by the Company in a transaction exempt from the registration requirements of the Securities Act of 1933, as amended (the “ Securities Act ”) and applicable state securities laws.


Purchaser agrees and acknowledges that the terms of the offer and sale of the Shares is governed by and subject to the terms and conditions of this Subscription Agreement and the Company’s filings under the Securities Exchange Act of 1934, as amended (collectively, the “ Offering Documents ”).


2.

Use of Proceeds .

Purchaser hereby acknowledges and agrees that, subject to Section 3 of this Subscription Agreement, the proceeds from the sale of the Shares will be used by the Company to provide a business line of credit to Diamond Venture Funds Management, LLC (“ DVF ”), in order to allow DVF to meet the liquidity requirements of the U.S. Small Business Administration for a Small Business Investment Company (“ SBIC ”) and thereby secure its SBIC Capital Certificate and License (collectively, the “ License ”).


3.

Closing and Escrow .


(a)

Contemporaneously with the execution of this Agreement (“ Closing ”), the following will be placed in escrow with Mallor Grodner Attorneys LLP, 511 Woodscrest Drive Bloomington, IN 47401, who is hereby appointed by Purchaser and the Company as escrow agent for the sale and purchase of the Shares (the “ Escrow Agent ”):


·

A certificate evidencing the Shares registered in Purchaser’s name, deposited by the Company.


·

The Purchase Price, deposited by Purchaser with the Escrow Agent by Purchaser as provided in Section 1 and a stock power endorsed in blank with signature medallion guaranteed, deposited by Purchaser.


(b)

If at any time within thirty (30) days after the Closing (the “Release Date” ), the opening Bid price of the Shares on the over-the-counter market as reported by OTC Markets Group, Inc. is less than $15.00 per Share (a “Share Price Trigger” ), Purchaser shall have the option, exercisable for a period of sixty (60) days after the Release Date (the “Notice Period” ) by written notice to the Company and the Escrow Agent (the “Repurchase Notice” ), to require the Company to repurchase the Shares for the Purchase Price.  In addition, and notwithstanding the foregoing, if a $30 million preferred debt financing, for the benefit of an entity acceptable to Purchaser in Purchaser’s reasonable discretion (an “Approved Financing” ), is not approved, closed, and funded prior to the Release Date, Purchaser shall have the option to deliver a Repurchase Notice to the Company and to the Escrow Agent.  If at any time during the Notice Period, Purchaser sends a Repurchase Notice to the Company and the Escrow Agent in accordance with this paragraph, the Escrow Agent shall



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disburse the Purchase Price to Purchaser by wire transfer in immediately available funds, and shall deliver the certificate evidencing the Shares together with the executed stock power to the Company for cancellation, and Purchaser and the Company shall then have no further obligations to each other under this Subscription Agreement.  If, however, the Approved Financing is consummated either (A) prior to the Release Date or (B) prior to the delivery date of the Repurchase Notice as determined in accordance with Section 10 of this Subscription Agreement, then the parties shall provide written notice to the Escrow Agent, instructing the Escrow Agent to release the Purchase Price to the Company and to release the certificate evidencing the Shares to Purchaser.


4.

Purchaser’s Representations and Warranties .   Purchaser represents and warrants to the Company that:


(a)

Purchaser is an “ accredited investor ” as such term is defined in Rule 501(a) of Regulation D under the Securities Act.  


(b)

Purchaser (i) has adequate means of providing for Purchaser’s current needs and possible contingencies and Purchaser has no need for liquidity of Purchaser’s investment in the Shares; (ii) can bear the economic risk of losing the entire amount of Purchaser’s investment in the Shares; and (iii) has such knowledge and experience that Purchaser is capable of evaluating the relative risks and merits of this investment.  The purchase of the Shares is consistent, in both nature and amount, with Purchaser’s overall investment program and financial condition.


(c)

Purchaser is a sophisticated, experienced investor, capable of determining and understanding the risks and merits of this investment.


(d)

Purchaser has reviewed the Offering Documents and has been afforded the opportunity to discuss with officers of the Company, its planned business operations, capital structure and financial condition and provided access to all other publicly available documents and information regarding the Company and the Shares, which Purchaser has requested to review in order to enable Purchaser to make an investment decision hereunder.  


(e)

Purchaser understands and acknowledges that significant risks exist with respect to the Company and its business, including without limitation, the Company’s limited capital and operations.  Purchaser further understands and acknowledges that there can be no assurance whatsoever that the Company will ever be profitable, or if it does, that the Company can maintain profitability.


(f)

Purchaser understands that the Shares have not been registered under the Securities Act or applicable state securities laws.


(g)

The Shares are being acquired solely for Purchaser’s own account, for investment and are not being purchased with a view to or for their resale or distribution.  


(h)

Purchaser is aware that:


(i)

The Shares are a speculative investment which involves an extremely high degree or risk;


(ii)

An investment in the Shares is not readily transferable and it may not be possible for Purchaser to liquidate the investment; and


(iii)

Until registered under the Securities Act and applicable state securities laws, there are substantial restrictions on the transferability of the Shares under the Securities Act and applicable state securities laws and the Company may not be able to effect such registration as provided for in this Subscription Agreement.


(i)

Purchaser has the full right, power and authority to execute and deliver this Subscription Agreement and perform Purchaser’s obligations hereunder.




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(j)

No approval, authorization, consent, order of other action of, or filing with, any person, firm or corporation or any court, administrative agency or other governmental authority is required in connection with the execution and delivery of this Subscription Agreement by Purchaser or the consummation of the sale and purchase of the Shares.


5.

Company’s Representations and Warranties .

Company represents and warrants to Purchaser that:


(a)

No registration or other filing with the SEC or any state securities regulatory body will be required as a result of this Subscription Agreement or the transactions contemplated hereby, other than filings are required to be made after Closing.


(b)

The execution, delivery, and performance of this Subscription Agreement and the consummation of the transactions contemplated hereunder, including, but not limited to, the Company’s repurchase obligations under Section 3(b) of this Subscription Agreement, do not and will not, after the giving of notice, the passage of time, or otherwise, conflict with, result in a breach of the terms and conditions of, accelerate, or modify any provision of or constitute a default under: (i) the Company’s Certificate of Incorporation, Bylaws, or other governing documents; (ii) any foreign, federal, state or local law, statute ordinance, rule or regulation; (iii) any court or administrative order or process; or (iv) any contract or agreement to which Company is a party.


6.

Restrictions on Transferability .

Purchaser understands that, with the exception of the Company’s repurchase obligation set forth in Section 3(b) of this Subscription Agreement, Purchaser may sell or otherwise transfer the Shares only if registered under the Securities Act and applicable state securities laws or Purchaser provides the Company with an opinion of counsel acceptable to the Company to the effect that such sale or other transfer may be made in absence of registration under the Securities Act. Any certificates or other documents evidencing the Shares will contain a restrictive legend reflecting these restrictions.  Purchaser acknowledges that the Company may not be able to affect such registration as provided for in this Subscription Agreement.


7.

Indemnification by Purchaser .

Purchaser agrees to indemnify and hold harmless the Company and its directors, officers, employees and agents, from and against and in respect of any and all loss, liability, claim, damage, deficiency, and all actions, suits, proceedings, demands, assessments, judgments, costs and expenses whatsoever (including, but not limited to, any and all expenses whatsoever, including attorneys’ fees, reasonably incurred in investigating, preparing, or defending against any litigation commenced or threatened or any claim whatsoever through all appeals) arising out of or based upon any false representation or warranty by Purchaser or breach or failure by Purchaser to comply with any covenant or agreement made by Purchaser in this Subscription Agreement.


8.

Indemnification by Company .  The Company agrees to indemnify and hold harmless Purchaser and its members, managers, employees and agents, from and against and in respect of any and all loss, liability, claim, damage, deficiency, and all actions, suits, proceedings, demands, assessments, judgments, costs and expenses whatsoever (including, but not limited to, any and all expenses whatsoever, including attorneys’ fees, reasonably incurred in investigating, preparing, or defending against any litigation commenced or threatened or any claim whatsoever through all appeals) arising out of or based upon any false representation or warranty by the Company or any breach or failure by the Company to comply with any covenant or agreement made by the Company in this Subscription Agreement.  


9.

Jurisdictional Notice .

THE SHARES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OR APPLICABLE STATE SECURITIES LAWS AND ARE BEING OFFERED AND SOLD IN RELIANCE ON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS.  THE SHARES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION, ANY STATE SECURITIES COMMISSION OR OTHER REGULATORY AUTHORITY, NOR HAVE ANY OF THE FOREGOING AUTHORITIES PASSED UPON OR ENDORSED THE MERITS OF THE OFFER AND SALE OF THE SHARES OR THE ACCURACY OR ADEQUACY OF THE DISCLOSURE MADE TO PURCHASER IN THE OFFERING DOCUMENTS. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.




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10.

Notices .  Any notices contemplated by this Subscription Agreement shall be sufficiently given when given in writing and will be deemed to have been duly given only if delivered (a) in person; (b) by first class, prepaid, registered or certified mail; (c) by courier or overnight express; or (d), if receipt is confirmed, by fax or email, to:


Purchaser:

Hoosier Real Estate Investors, LLC

2015 N. Dunn Street

Bloomington, Indiana 47408

Email:   assurfinjp@aol.com


with a copy to:

Garry L. Founds

Mallor Grodner LLP

511 Woodscrest Drive

Bloomington, Indiana 47401

Fax:  812-961-6161

Email:   gfounds@lawmg.com


the Company:

Alpha Investment Inc.

200 Campus View Suite 200

Columbus, OH 43235

Email:   todd@alphainvestmentinc.com


with a copy to:

Dale S. Bergman

Gutierrez Bergman Boulris PLLC

100 Almeria Avenue, Suite 340

Coral Gables, Florida  33134

Fax:  888-281-1829

Email:   dale.bergman@gbbpl.com


If mailed, such notice shall be deemed to be delivered two business days after it was deposited in the United States mail, addressed to the party at the address above, with postage thereon prepaid.  If sent by overnight courier, such notice shall be deemed delivered when delivery is confirmed by the courier.  If sent by email or fax, such notice shall be deemed delivered when the recipient confirms receipt.  Either party may change its notice address hereunder by giving the other party notice of the new address in the manner set forth above


11.

Miscellaneous .


(a)

This Subscription Agreement constitutes the entire agreement between the parties hereto with respect to the subject matter hereof. This agreement supersedes all prior negotiations, letters and understandings relating to the subject matter hereof.


(b)

This Subscription Agreement may not be amended, supplemented or modified in whole or in part except by an instrument in writing signed by the party or parties against whom enforcement of any such amendment supplement or modification is sought.


(c)

This Subscription Agreement will be interpreted, construed and enforced in accordance with the laws of the State of Florida, without giving effect to the application of the principles pertaining to conflicts of laws.  Exclusive jurisdiction for any action arising under this Agreement shall be in a Federal or state court of competent subject matter jurisdiction in Miami-Dade County, Florida.


(d)

The failure of any party at any time or times to require performance of any provision of this Subscription Agreement will in no manner affect the right to enforce the same. The waiver by any party of any breach of any provision of this Agreement will not be construed to be a waiver by any such party of any succeeding breach of that provision or a waiver by such party of any breach of any other provisions.


(e)

The invalidity, illegality or unenforceability of any provision or provisions of this Subscription Agreement will not affect any other provision of this Subscription Agreement, which will remain in



4 | Page






full force and effect, nor will the invalidity, illegality or unenforceability of a portion of any provisions of this Subscription Agreement affect the balance of such provision. In the event that any one or more of the provisions contained in this Subscription Agreement or any portion thereof shall for any reason be held to be invalid, illegal or unenforceable in any respect, this Subscription Agreement shall be reformed, construed and enforced as if such invalid, illegal or unenforceable provision had never been contained herein.


(f)

Should it become necessary for any party to institute legal action to enforce the terms and conditions of this Subscription Agreement, the successful party will be awarded reasonable attorneys’ fees at all trial and appellate levels, expenses and costs.


(g)

This Subscription Agreement will be binding upon and will inure to the benefit of any successor or successors of the parties hereto.


(h)

This Subscription Agreement may be executed in one or more counterparts (including by facsimile or electronic transmission), each of which will be deemed an original and all of which together will constitute one and the same instrument.


( Signatures Appear on Following Page )




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IN WITNESS WHEREOF, Purchaser and the Company have executed this Agreement as of the latest date set forth below.


PURCHASER:

 

 

HOOSIER REAL ESTATE INVESTORS, LLC

an Indiana limited liability company


By:

/s/ Thomas C. Guthrie

 

Name:

 

Thomas C. Guthrie, Manager


September 13, 2017

Date

 

 

2015 N. Dunn Street

 

 

Bloomington, IN 47408

Street Address

 

 

THE COMPANY:

 

ALPHA INVESTMENT INC


By:

/s/ Todd C. Buxton

 

Todd C. Buxton, CEO


September 19, 2017

Date










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Exhibit 10.7


April 17, 2017


ALPHA INVESTMENT INC.


Code of Business Conduct and Ethics

For Directors, Officers and Employees


Introduction


This is the Code of Business Conduct and Ethics (the “ Code ”) for directors, officers and employees of ALPHA INVESTMENT, INC. , a Delaware corporation (the “ Company ”). This Code sets out ten important rules that the Company’s Board of Directors (the “ Board ”), have chosen to guide the Company’s directors, officers and employees during their service to the Company. The Board’s audit committee (the “ Committee ”) or in the absence thereof, the Board as a hole administers this Code. Each director, officer and employee will be required to acknowledges in writing the receipt, review, and understanding of the Code. Each director, officer and employee is expected to abide both the letter, as well as by the spirit and intent of the Code.  No code can anticipate every situation that may arise nor can it replace the thoughtful behavior of an ethical director, officer and employee. Rather, this Code provides guidance for handling situations as they arise.


Please raise any questions or concerns about the Code or any related situation to the Chair of the Committee or in the absence thereof, the Chairman of the Board, who may consult with the Committee or the Board as a whole, as well as  with counsel.


Objective—Earning and Maintaining Trust


This Code is part of the Company’s commitment to integrity. The Code focuses on areas of ethical risk, provides guidance to help us recognize and deal with ethical issues, provides mechanisms to report unethical conduct, and helps foster a culture of honesty and accountability. The ten rules in the Code guide our handling of ethical matters and describe the values that guide us in our decisions, particularly the most essential value – trust. Trust means that others can rely on us to speak truthfully, to honor our commitments, and to treat others fairly. The Company’s reputation for integrity is one of our most valuable assets. The Company. must earn and keep the trust of investors, consumers, customers, business partners, employees, and the general public. Maintaining and improving this trust requires that we follow the Code’s principles and rules.


The Rules


Rule #1. Give the Company our complete business loyalty.


While we serve the Company, our shareholders expect us to make business decisions without the influence of any improper personal interest or gain. Therefore, we avoid situations in which our personal interests interfere, or appear to interfere, in any way with the Company’s interests. Conflicts arise when our personal interests make it difficult to perform our responsibilities objectively or effectively. Conflicts of interest also may arise when we, or a family member, receive improper personal benefits because of our positions as employees or members of the Board.


Situations involving a conflict of interest are not always obvious or easy to resolve. Therefore, we bring any questions concerning potential conflicts to the Chair of the Audit Committee or, in the absence thereof, the Chairman of the Board. We disclose immediately to the Chair of the Audit Committee or the Chairman of the Board, as the case may be, any situation that could involve an actual or potential conflict of interest. Family members for purposes of the Code include a spouse, domestic partner, parents, children, siblings, fathers and mothers-in-law, sons and daughters-in-law, brothers and sisters-in-law. and anyone who shares the director’s, officer’s employee’s home.



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The Chair of the Audit Committee of the Chairman of the Board may consult with the Committee or the Board as a whole, as well as with counsel regarding any potential conflicts.


Examples of common conflicts that we avoid or disclose to the Chair of the Audit Committee or the Chairman of the Board, as the case may be, include the following:


Personal benefits and gifts . We do not receive a personal benefit from any person or firm seeking or currently doing business with the Company. Personal benefits include consultant fees, exercisable stock options or other remuneration, non-cash gifts, meals or entertainment (other than those of nominal value and for ordinary business purposes), or any other benefit that a reasonable person may conclude could affect our objectivity. We never accept cash or cash equivalents, bribes or kickbacks.


Competition . We do not compete with the Company.


Personal use of the Company’s assets . We do not use the Company’s assets, labor, resources, or information except for legitimate Company business purposes.


Loans and Guarantees. We do not accept loans or guarantees from the Company.


Compensation from non -Company sources. We do not accept compensation (in any form) for services we perform for the Company from any source other than the Company.


Conflicts arising from a role at other organizations. We sometimes serve as a director, officer or employee of, serve as an advisor or consultant to, are a significant investor in, or have a similar role at another organization. If we encounter a situation where our current role in that other organization could have the potential to conflict, or appear to conflict with the Company’s interests, we immediately:


(i)

inform the Chair of the Committee or the Chairman of the Board, as the case may be,

(ii)

 take appropriate action, including recusing ourselves from participation in the Committee’s or the Board’s discussion and consideration of any matter related to or giving rise to the potential conflict,

(iii)

 take all actions requested by the Chair of the Audit Committee or the Chairman of the Board, as the case may be, and

(iv)

 take any other action which is necessary or appropriate under the circumstances.


Prior to accepting a new role at another organization, we consider whether that role could have the potential to conflict, or appear to conflict with the Company’s interests and follow these same steps.


Our family members’ activities also may create a situation involving a conflict of interest and we disclose any family member’s relationship that involves an actual or potential conflict of interest with the Company.


Rule #2. Never trade on inside information.


We do not trade securities while we have material non-public information. Material information includes anything likely to influence a potential investor’s decision to trade in securities including, but not limited to, information about mergers, earnings, projects, and changes in management. In addition to the Company’s securities, this restriction applies to the trading of the securities of our customers, suppliers, or other business partners if we have material non-public information about them. Further, if we cannot make trades because we possess material non-public information, neither can our family members.




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Rule #3. Honor Confidentiality.


We maintain the confidentiality of all confidential information entrusted to us during our service to the Company. We share that information only when a duly authorized officer of the Company advises that disclosure is authorized or legally mandated. Confidential information includes all non-public information related to the Company. We also exercise due care in handling the Company’s proprietary and confidential information. We avoid discussing this information in public areas or with family members. Our obligation to preserve the Company’s confidential information is ongoing, even after our service as a director, officer of employee concludes.


Rule #4. Never Misappropriate Corporate Opportunities. Ensure Proper Use of Corporate Assets.


We owe a duty to the Company. to advance its legitimate interests when the opportunity to do so arises. We do not use opportunities that we discover using the Company’s corporate property, information (confidential or otherwise) or position for our personal benefit unless the Company’s Board (including a majority of the Board’s disinterested directors determine that the Company will not pursue such opportunity. We use corporate property, information, or position only for legitimate business purposes; never for personal gain. We protect the Company’s assets and ensure their efficient use.


Rule #5. We Provide Accurate Information to the Company.


The Company relies on information that we provide when it prepares disclosure documents and regulatory filings and for other purposes. We are truthful, forthright, and accurate when preparing director and officer questionnaires, stock information forms, expense reimbursement forms, and other documents for the Company’s use.


Rule #6. Comply with Laws, Rules and Regulations.


We do not instruct others to commit illegal or unethical acts for any reason when they are conducting business for the Company.


Each of us is a representative of the Company and we deal fairly with others (including the Company’s customers, suppliers, competitors, and employees) when conducting the Company’s business. We do not take unfair advantage of anyone through manipulation, concealment, abuse of privileged information, misrepresentation of material facts, or any other unfair dealing practice.


Rule #7. Honor Alpha Investment Inc. Values.


No set of rules could answer every question that we face as employees. When these rules do not address a situation, we refer to Alpha Investment Inc. values for guidance. These are:

• We inspire trust.

• We act like owners.

• We keep it simple.

• We are open and inclusive.

• We tell it like it is.

• We lead from the head and the heart.

• We discuss. We decide. We deliver.


As directors, officers and employees of the Company., we champion these values and encourage all of the Company’s directors, officers and employees to follow them. We ask questions when we are not sure what to do. Fortunately, we have many places to turn for help, among them, management and counsel. We never hesitate to consult them.



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Rule #8. Report Any Concerns.


If we suspect a violation of this Code, we promptly communicate that concern to the Chair of the Committee or the Chairman of the Board, as the case may be).  Any concerns about the Chair of the Audit Committee or the Chairman of the Board to counsel to the Company.


Rule #9. Address Reports of Concerns about Potential Code Violations.


If a director, officer or employee violates this Code, we all suffer consequences, especially the Company. Ignoring violations leads to greater problems and damages trust. The Committee or the Board, as the case may be promptly addresses reports of concerns about director, officer or employee behavior and carefully looks into the facts and circumstances surrounding any report. The Committee or the Board conducts all investigations fairly and considers all relevant information. The Audit Committee actively addresses any violations of this Code. Upon advice of legal counsel, AVRA Medical Robotics, Inc. may report violations of the Code that involve illegal behavior to the appropriate authorities.


Rule #10. We Encourage Others to Report Concerns and We Do Not Retaliate.


As directors, officers and employees, we support management’s efforts to promote honest behavior and an ethical environment at Alpha Investment Inc. If anyone suspects that there has been a violation of the law, this Code, or any other policy of the Company, we encourage them to raise that concern so that the Company may quickly respond.


The Company does not tolerate retaliation against anyone for raising a concern in good faith. Raising good faith concerns is vital to Alpha Investment, Inc.’s success.


Waivers and Amendments


In the unlikely event that a waiver of the Code would be in the Company’s best interests, only the Board may grant such waiver.


Similarly, the Code may only be amended by the Board.  The Company will promptly disclose to stockholders any amendments to the Code by either posting it on the Company website or by making other appropriate public disclosure.




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Exhibit 23.1


PLS CPA, A PROFESSIONAL CORPORATION

t 4725 MERCURY STREET #210 t SAN DIEGO t CALIFORNIA 92111 t

t TELEPHONE (858)722-5953 t FAX (858) 761-0341   t FAX (858) 433-2979

t E-MAIL changgpark@gmail.com t

 

 

 



 

October 27, 2017



To Whom It May Concern:




We consent to the incorporation by reference in the registration statements of Alpha Investment Inc of our report dated March 16, 2017, with respect to the balance sheets as of December 31, 2016 and 2015, and the related statements of income, cash flows, and shareholders’ deficit for the fiscal years period ended December 31, 2016 and 2015, which appears on Form S-1 of Alpha Investment Inc. (formerly known as GGBY Inc).







Very truly yours,


/s/PLS CPA

____________________________                                               

PLS CPA, A Professional Corp.

San Diego, CA 92111



 

 

 



Registered with the Public Company Accounting Oversight Board