UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
X QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For quarterly period ended September 30, 2000
____ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _____ to _____
Commission file number: 0-29819
ZETA CORPORATION
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(exact name of small business issuer as specified in its charter)
FLORIDA 58-2349413
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(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
Suite 214 - 1628 West 1St Avenue, Vancouver, BC V6J 1G1
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(Address of principal executive offices) (zip code)
Registrant's telephone number, including area code: (604) 659-5018
Check whether the issuer: (1) has filed all reports required by Section 13 or 15
(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the issuer was required to file such reports), and
(2) has been subject to such filing requirements for the past 90 days. Yes [ X ]
No
State the number of shares outstanding of each of the Issuer's classes of common
equity as of the latest practicable date: as of November 6, 2000, there were
10,300,000 shares of the Issuer's Common Stock, $0.001 par value per share
outstanding.
Transitional Small Business Disclosure Format (Check One): Yes [ ] No [x]
<PAGE>
ZETA CORPORATION
FORM 10-QSB, QUARTER ENDED SEPTEMBER 30, 2000
INDEX
PART I FINANCIAL INFORMATION
Item 1 Financial Statements
<TABLE>
<CAPTION>
<S> <C>
Balance Sheet as of September 30, 2000 3
Statement of Operations for the Quarter Ended September 30, 2000 and 1999,
and for the Nine Months Ended September 30, 2000 and 1999 4
Statement of Cash Flows for the Nine Months Ended September 30, 2000 and 1999 5
Notes to Interim Financial Statements 6
All schedules are omitted because they are not applicable or the required
information is shown in the financial statements or notes thereto.
Item 2 Management's Discussion and Analysis 7
PART II OTHER INFORMATION
Item 1 Legal Proceedings 9
Item 2 Changes in Securities 9
Item 3 Defaults Upon Senior Securities 9
Item 4 Submission of Matters to a Vote of Security Holders 9
Item 5 Other Information 9
Item 6 Exhibits and Reports on Form 8-K 9
Signatures 10
</TABLE>
<PAGE>
ITEM 1 Financial Statements
ZETA CORPORATION
(A Development Stage Company)
INTERIM BALANCE SHEET
SEPTEMBER 30, 2000 AND DECEMBER 31, 1999
(Unaudited)
<TABLE>
<CAPTION>
ASSETS 2000 1999
---- ----
<S> <C> <C>
Current Assets
Cash $ 164,548 $ 181,884
Prepaid Expenses 125 125
Total Current Assets $ 164,673 $ 182,009
Fixed Assets
Computer Equipment - Net 3,470
Other Assets
Organization Costs 3,000 3,000
Total Assets $ 171,143 $ 185,009
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts Payable $ 150 $ 0
Stockholders' Equity
Preferred Stock: $0.10 Par Value; Authorized
Shares, 1,000,000 shares; Issued and None None
Outstanding, None
Common Stock: $0.001 Par Value; Authorized Shares,
100,000,000; Issued and Outstanding, 10,300,000 and
10,300,000 Shares at September 30, 2000 and December 31,1999,
respectively 10,300 10,300
Additional Paid In Capital 767,700 767,700
Loss Accumulated During the Development Stage (607,007) (592,991)
Total Stockholders' Equity 170,993 185,009
Total Liabilities and Stockholders' Equity $ 171,143 $ 185,009
</TABLE>
<PAGE>
ZETA CORPORATION
(A Development Stage Company)
INTERIM STATEMENT OF OPERATIONS
FOR THE THREE AND NINE MONTH PERIOD ENDED SEPTEMBER 30, 2000 AND 1999
(Unaudited)
<TABLE>
<CAPTION>
For The From Inception
For The Three For The Three For The Nine Nine Months (October 21,
Months Ended Months Ended Months Ended Ended 1997 to
September 30, September 30, September 30, September 30, September 30,
2000 1999 2000 1999 2000
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<S> <C> <C> <C> <C> <C>
Revenues $ 0 $ 0 $ 0 $ 0 $ 0
Expenses
General and 2,837 120,103 21,715 126,130 626,381
Administrative
Other Income
Interest Income 2,631 3,666 7,699 7,260 19,374
Net Income (Loss) Available
to Common Stockholders $ (206) $ (116,437) $ (14,016) $ (118,870) $ (607,007)
Basic Loss Per Common
Share $ (0.000) $ (0.011) $ ( 0.001) $ (0.012) $ (0.059)
Basic Weighted Average
Common Shares Outstanding 10,300,000 10,300,000 10,300,000 10,300,000 10,300,000
</TABLE>
<PAGE>
ZETA CORPORATION
(A Development Stage Company)
INTERIM STATEMENT OF CASH FLOWS
FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 2000 AND 1999
<TABLE>
<CAPTION>
From Inception
Nine Months Ended Nine Months Ended (October 21, 1997)
Sept 30, 2000 Sept 30, 1999 to Sept 30, 2000
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<S> <C> <C> <C>
Cash Flows From Operating Activities
Net Loss $ (14,016) $ (118,870) $ ( 607,007)
Adjustments to Reconcile Net Loss to Net Cash
Used
By Operating Activities
Common Stock Issued For Services 403,000
Changes in Assets and Liabilities
(Increase) Decrease in Other Receivable
(Increase) Decrease in Prepaid Expenses (125)
(Increase) Decrease in Organization Costs (3,000)
Increase (Decrease) in Accounts Payable 150 150
Common Stock Issued For Services 403,000
Net Cash Used By Operating Activities (13,866) (118,870) (206,982)
Cash Flows From Investing Activities
Purchase of Property and Equipment (3,470) (3,470)
Investment, Cash Paid For Acquisition
Net Cash Flows From Investing Activities (3,470) 0 (3,470)
Cash Flows From Financing Activities
Proceed From Issuance of Common Stock 0 300,000 375,000
Cost of Public Offering
Proceeds From Stock Options Exercised
Net Cash Provided By Financing Activities 0 300,000 375,000
Increase (Decrease) in Cash and Cash Equivalents (17,336) 181,130 164,548
Cash and Cash Equivalents, Beginning of Year 181,884 3,054 0
Cash and Cash Equivalents, End of Year $ 164,548 184,184 $ 164,548
</TABLE>
<PAGE>
ZETA CORPORATION
NOTES TO INTERIM FINANCIAL STATEMENTS SEPTEMBER 30, 2000
NOTE 1 - PRESENTATION OF INFORMATION FURNISHED
The accompanying unaudited interim financial statements have been prepared in
accordance with the instructions for Form 10QSB and, Item 310 of Regulation S-B,
and in the opinion of management, contains all adjustments (consisting of only
normal recurring adjustments) necessary to present fairly the financial position
as of September 30, 2000, the results of operations for the three and nine month
periods ended September 30, 2000, and the statement of cash flows for the three
and nine months ended September 30, 2000. These results have been determined on
the basis of generally accepted accounting principles and practices and applied
consistently with those used in the preparation of the Company's audited
financial statements and notes for the year ended December 31, 1999.
The accompanying financial statements also have been prepared in conformity with
generally accepted accounting principles, which contemplates continuation of the
Company as a going concern. The continuation of the Company as a going concern
is dependent upon the Company's ability to establish itself as a profitable
business. It is the Company's belief that it will continue to require additional
funds to be obtained from private or public equity investments, and possible
future collaborative agreements to become a viable entity.
Certain information and footnote disclosures normally included in the financial
statements presented in accordance with generally accepted accounting principles
have been condensed or omitted. It is suggested that the accompanying unaudited
interim financial statements be read in conjunction with the financial
statements and notes thereto incorporated by reference in the Company's
1999,1998,1997, audited financial statements.
<PAGE>
ITEM 2. Management's discussion and Analysis of financial condition and results
of operations
When used in this discussion, the words "believes," "anticipates," "expects,"
and similar expressions are intended to identify forward-looking statements.
Such statements are subject to certain risks and uncertainties, which could
cause actual results to differ materially from those projected. Readers are
cautioned not to place undue reliance on these forward-looking statements, which
speak only as of the date hereof. Actual results, performance or achievements
could differ materially from those anticipated in such forward looking
statements as a result of numerous factors, including but not limited to the
Company's ability to continually expand its subscriber base and opt-in email
lists, market its services to potential advertisers, the regulatory environment
in which the Company operates, future acceptance of its services and other
factors described in the company's filings with the Securities and Exchange
Commission. The Company undertakes no obligation to republish revised
forward-looking statements to reflect events or circumstances after the date
hereof or to reflect the occurrence of unanticipated events. Readers are also
urged to carefully review and consider the various disclosures made by the
Company which attempt to advise interested parties of the factors which affect
the Company's business, in this report, as well as the Company's periodic
reports on Forms 10-KSB, 10QSB and 8-K filed with the Securities and Exchange
Commission.
Overview
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The Company is currently developing a website (www.newcompanycapital.com) to
serve as an online community for entrepreneurs and start-up companies seeking
capital and accredited investors seeking to invest. The Company plans to charge
a listing fee to entrepreneurs and start-up companies seeking to raise capital
by posting their executive summaries in a password protected section of the
website. Accredited investors seeking greater detail before investing will be
charged a viewing fee to access business plans. The information posted on the
web site will not consist of offering material nor will the Company offer or
sell securities. The Company's website will serve strictly as a conduit or
meeting place. The Company will not collect commissions or any other fees, other
than a listing fee from the client company or entrepreneur seeking capital and a
viewing fee from the investor. The Company will not be involved in any other
aspect of the client company's business, nor in the decision making process of
the investor.
The market for early stage financing is highly fragmented and inefficient.
Entrepreneurs and start-up companies often find it difficult, time-consuming and
costly to access and make presentations to the venture capital community.
Likewise, investors wishing to make early stage investments also find it
difficult to gain access to a wide variety of companies or entrepreneurs seeking
early stage capital. Large amounts of money flowing into the venture capital
market has resulted in the average venture capital investment being made rising
by $5.4 million in the third quarter of 1998 to over $9.1 million in the third
quarter of 1999 according to PricewaterhouseCoopers. This has made it more
difficult for companies seeking to raise smaller amounts of early stage capital,
often between $100,000 to $4,000,000.
<PAGE>
Results of Operations
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Revenues. The Company has generated zero revenues for the three and nine months
ended September 30, 2000, and for the same periods in 1999. To date, the Company
has not relied on revenues for funding.
For the next twelve to eighteen months, the Company expects to generate minimal,
if any, revenues due to the early stage of its operations. In order to develop
an online community of funders and those seeking funding, the Company plans to
advertise its services through opt-in email lists, through print media catering
to entrepreneurs, and to certain professional communities, such as lawyers,
accountants and investment bankers. The Company plans to charge a listing fee to
entrepreneurs and start-up companies seeking to raise capital by posting their
executive summaries in a password protected section of the website. Accredited
investors seeking greater detail before investing will be charged a viewing fee
to access business plans.
As at September 30, 2000, the Company had a cash balance of $164,548, which is
sufficient to cover all current and ongoing development of the Company's
website, sales and marketing and operating expenses for the next twelve months.
General and Administrative Expenses. During the three and nine month periods
ended September 30, 2000, the Company incurred $2,837 and $21,715 in general and
administrative expenses, respectively, a decrease of 97.6% and 82.8%,
respectively, when compared with the corresponding periods in 1999. This
decrease in general and administrative expenses is primarily due to continued
changes in the Company's website layout and design, functionality issues and
delays and difficulty in hiring appropriate personnel. As a result, the Company
has postponed the launch of its website until year end 2000 or early 2001.
Subsequent to the launch of newcompanycapital.com and for the remainder of 2001,
the Company expects to incur significantly greater general and administrative
expenses due to an expected increase in personnel, advertising and marketing
costs and general operating expenses.
Interest Income. Interest income was $2,631 and $7,699 for the three and nine
month periods ended September 30, 2000, respectively, versus $3,666 and $7,260
for the corresponding period in 1999. Interest earned in the future will be
dependent on Company funding cycles and prevailing interest rates.
Provision for Income Taxes. As of June 30, 2000, the Company's accumulated
deficit was $607,007, and as a result, there has been no provision for income
taxes to date.
Net Loss. For the three and nine months ended September 30, 2000, the Company
recorded a net loss of $206 and $14,016, respectively, compared to a net loss of
$116,437 and $118,870, for the same periods in 1999.
Liquidity and Capital Resources
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As at June 30, 2000, the Company had a cash balance of $164,548, compared to
$181,884 as at December 31, 1999.
Net cash used by operating activities was $13,866 for the nine month period
ending September 30, 2000, compared to net cash used of $118,870 for the same
period in 1999. This decrease in the net cash used in operating activities is
primarily due to continued changes in the Company's website layout and design,
functionality issues and delays and difficulty in hiring appropriate personnel.
<PAGE>
Net cash provided by financing activities was $0 for the nine month period
ending September 30, 2000, compared to $300,000 for the same period in 1999. The
Company has financed its operations primarily through cash on hand during the
nine month period ending September 30, 2000.
The Company's future funding requirements will depend on numerous factors. These
factors include the Company's ability to operate its business profitably in the
future, recruit and train qualified management, technical and sales personnel,
and the Company's ability to compete against other, better capitalized
corporations who offer similar web based services.
The Company may raise additional funds through private or public equity
investment in order to expand the range and scope of its business operations.
The Company may seek access to the private or public equity but there is no
assurance that such additional funds will be available for the Company to
finance its operations on acceptable terms, if at all.
PART II - Other Information
Item 1 Legal Proceedings
None
Item 2 Changes in Securities
None
Item 3 Defaults Upon Senior Securities
None
Item 4 Submission of Matters to a Vote of Security Holders
None
Item 5 Other Information
None
Item 6 Exhibits and Reports on Form 8-K
(a) Exhibits
Financial Data Schedule
(b) Reports on Form 8-K
On September 26, 2000, the Company filed a Form 8-K reporting that , effective
September 20th, 2000, Mr. Dave Gamache had resigned as a Director of the
Company. Replacing Mr. Gamache in the capacity of Director is Mr. Lance Dusanj.
In 1990, Mr. Dusanj graduated from the British Columbia Institute of Technology
with a Diploma in Wood Products Manufacturing. Since 1990, Mr. Dusanj has been
employed full time as a grader and driver at the MacMillan Bloedel Canadian
White Pine Division, which was acquired by Weyerhaeuser in 1999.
<PAGE>
Signature Page
Pursuant to the requirements of section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
ZETA CORPORATION
/s/ Harmel S. Rayat
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Harmel S. Rayat
CEO and President
/s/ Lance Dusanj
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Lance Dusanj
Director
/s/ Harvinder Dhaliwal
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Harvinder Dhaliwal
Director, Secretary & Treasurer
Dated: November 6, 2000
