SEC Filing Summary: Zeta Acquisition Corp. III
Business Context and Reporting Period
This Form 10-Q covers the quarterly period ended June 30, 2010. The registrant is Zeta Acquisition Corp. III, a Delaware corporation organized as a "blank check" company and shell company. The entity is in the development stage with no specific business plan other than to investigate and acquire a target company to achieve long-term growth. The filing text does not contain information regarding "Kura Oncology, Inc." despite the metadata request; the document pertains exclusively to Zeta Acquisition Corp. III.
Key Financial Metrics
| Metric | Value (June 30, 2010) | Value (Dec 31, 2009) |
|---|---|---|
| Cash and Cash Equivalents | $5,760 | $11,142 |
| Total Assets | $11,385 | $13,017 |
| Total Liabilities | $39,863 | $31,613 |
| Stockholders' Deficit | ($28,478) | ($18,596) |
| Notes Payable (Stockholders) | $35,000 | $25,000 |
| Revenue | $0 | $0 |
| Net Loss (6 Months Ended June 30, 2010) | ($9,882) | ($7,032) |
| Cumulative Net Loss (Inception to June 30, 2010) | ($78,478) | N/A |
Material Changes vs. Prior Period
- Liquidity Decline: Cash and cash equivalents decreased by approximately $5,382 during the six months ended June 30, 2010, compared to an increase of $9,267 in the same period in 2009.
- Increased Debt: Notes payable to stockholders increased by $10,000, rising from $25,000 to $35,000. These notes bear 6% interest and are due on demand.
- Widening Deficit: The accumulated deficit increased by $9,882 for the six-month period, driven by operating expenses (legal, accounting, audit fees) and interest expense.
- Expense Growth: General and administrative expenses for the six months ended June 30, 2010, were $9,057, compared to $6,950 for the same period in 2009.
Outlook, Risks, and Management Commentary
- Going Concern: Management explicitly states that the company's ability to continue as a going concern is dependent on its ability to generate future profitable operations and/or obtain necessary financing. There is no assurance that additional funding will be available.
- Business Plan: The company has no active operations other than seeking a business combination (reverse merger). It anticipates incurring costs related to filing reports and investigating acquisitions over the next 12 months.
- Financing Dependence: The company is dependent on related parties (stockholders) for continued funding. It has no revenue and relies on capital investment to fund activities.
- Risks: Risks include the inability to find a suitable target company, the potential for the target to be financially unstable, and the lack of diversification as the company likely intends to effect only one business combination.
Investor Verification Checklist
- Capital Adequacy: Verify if the current cash balance of $5,760 is sufficient to cover filing and operational costs for the next 12 months without additional stockholder loans.
- Debt Obligations: Confirm the terms and repayment status of the $35,000 in notes payable to stockholders, which are due on demand.
- Target Search Status: Assess the progress of management's efforts to identify a target company for a reverse merger, as no specific target has been identified.
- Related Party Transactions: Review the nature of the $10,000 increase in notes payable to stockholders and the use of officer/director office space at no cost.
- Regulatory Compliance: Confirm the company's status as a "smaller reporting company" and its adherence to SEC reporting requirements despite having no operations.