UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2011
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ______________ to ______________
Commission File Number 000-54195
KOHLER CAPITAL III, CORPORATION
(Exact name of registrant as specified in its charter)
Florida 54-2048542
(State or other jurisdiction of
Incorporation or organization (I.R.S. Employer
Identification Number)
2208 Pershing Avenue, Sheboygan, WI 53083
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (920)-207-7772
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
Yes x No
Indicate by check mark whether the registrant has submitted electronically
and posted on its corporate Web site, if any, every Interactive Data File
required to be submitted and posted pursuant to Rule 405 of Regulation S-T
(Sec. 232.405 of this chapter) during the preceding 12 months (or for such
shorter period that the registrant was required to submit and post such
files).
Yes No
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 (Check one):
Large accelerated filer Accelerated filer
Non-accelerated filer Smaller reporting company x
Indicate by check mark whether the registrant is a shell company
(as defined in Rule 12b-2 of the Exchange Act).
Yes x No
The number of shares outstanding of issuer's common stock, no par
value as of May 1, 2011: 2,000,000.
Page 1
INDEX
Page
PART I - Financial Information 3
Item 1: Financial Statements 3
Condensed Balance Sheets as of March 31,
2011 (Unaudited) and June 30, 2010 3
Condensed Statements of Operations For the
Three and Nine Months Ended March 31, 2011
and 2010 (Unaudited) 4
Condensed Statements of Cash Flows for
the Nine Months Ended March 31, 2011
and 2010 (Unaudited) 5
Notes to Condensed Financial
Statements (Unaudited) 6
Item 2: Management's Discussion and Analysis
of Financial Condition and Results of Operations 7
Item 4T: Controls and Procedures 11
PART II - Other Information 12
Item 1: Legal Proceedings 12
Item 2: Unregistered Sales of Equity Securities
and Use of Proceeds 12
Item 3: Defaults Upon Senior Securities 12
Item 5: Other Information 12
Item 6: Exhibits 12
Signatures 13
Page 2
ITEM 1. FINANCIAL STATEMENTS
Kohler Capital III, Corporation
(A Development Stage Company)
Balance Sheets
March 31, June 30,
2011 2010
(Unaudited)
ASSETS
Current assets:
Total current assets $- $-
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Total current liabilities $- $-
Stockholders' equity:
Common stock, no par value, 100,000,000 shares authorized;
2,000,000 shares issued and outstanding 2,000 2,000
Additional paid-in capital 15,700 9,250
(Deficit) accumulated during the development stage (17,700) (11,250)
Total stockholders' equity - -
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $- $-
See the accompanying notes to the financial statements.
Page 3
Kohler Capital III, Corporation
(A Development Stage Company)
Statements of Operations
(Unaudited)
The Period from
May 7, 2001
Three Months Three Months Nine Months Nine Months (inception)
Ended Ended Ended Ended to
March 31, March 31, March 31, March 31, March 31,
2011 2010 2011 2010 2011
Revenue $- $- $- $- $-
Costs and expenses:
General and administrative 1,250 250 6,450 750 17,700
Total costs and expenses 1,250 250 6,450 750 17,700
Net loss $(1,250) $(250) $(6,450) $(750) $(17,700)
Per share information -
Basic and diluted:
Loss per common share $(0.00) $(0.00) $(0.00) $(0.00)
Weighted average common
shares outstanding 2,000,000 2,000,000 2,000,000 2,000,000
See the accompanying notes to the financial statements.
Page 4
Kohler Capital III, Corporation
(A Development Stage Company)
Statements of Cash Flows
(Unaudited)
For the
Period From
May 7, 2001
Nine Months Nine Months (Inception)
Ended Ended Through
March 31, March 31, March 31,
2011 2010 2011
Cash flows from operating activities:
Net loss $(6,450) $(750) $(17,700)
Adjustments to reconcile net loss to net
cash (used in) operating activities:
Common shares issued for services - - 2,000
Contributed expenses 5,700 - 5,700
Contributed services 750 750 10,000
Net cash provided by(used in) operating activities - - -
Cash flows from investing activities:
Net cash provided by(used in) investing activities - - -
Cash flows from financing activities:
Net cash provided by (used in) financing activities - - -
Net increase (decrease) in cash - - -
Cash - beginning of period - - -
Cash - end of period $- $- $-
Supplemental Cash Flow Information:
Cash paid for interest $- $- $-
Cash paid for income taxes $- $- $-
See the accompanying notes to the financial statements.
Page 5
Kohler Capital III, Corp
Notes to Financial Statements
March 31, 2011
(Unaudited)
(1) Basis Of Presentation
The accompanying unaudited condensed consolidated financial statements have
been prepared in accordance with generally accepted accounting principles
(GAAP) for interim financial information and Rule 8.03 of Regulation SX.
They do not include all of the information and footnotes required by GAAP
for complete financial statements. In the opinion of management, all
adjustments (consisting only of normal recurring adjustments) considered
necessary for a fair presentation have been included.
The results of operations for the periods presented are not necessarily
indicative of the results to be expected for the full year. For further
information, refer to the consolidated financial statements of the Company
as of and for the period from inception to June 30, 2010, including notes
thereto.
(2) Earnings Per Share
The Company calculates net income (loss) per share as required by Financial
Accounting Standards Board ("FASB") Accounting Standards Codification
("ASC") 260, "Earnings per Share." Basic earnings (loss) per share is
calculated by dividing net income (loss) by the weighted average number of
common shares outstanding for the period. Diluted earnings (loss) per share
is calculated by dividing net income (loss) by the weighted average number
of common shares and dilutive common stock equivalents outstanding. During
periods when anti-dilutive common stock equivalents are not considered
in the computation.
(3) Basis of Reporting
The Company's financial statements are presented on a going concern basis,
which contemplates the realization of assets and satisfaction of liabilities
in the normal course of business.
The Company has experienced a loss from operations as a result of its
investment necessary to achieve its operating plan, which is long-range in
nature. The Company incurred net losses from inception to March 31, 2011,
aggregating $17,700, has no revenue generating operations and is in the
development stage.
The Company's ability to continue as a going concern is contingent upon its
ability to secure additional financing, increase ownership equity and
develop profitable operations. In addition, the Company's ability to continue
as a going concern must be considered in light of the problems, expenses and
complications frequently encountered by entrance into established markets and
the competitive environment in which the Company operates.
The Company is pursuing financing for its operations and seeking additional
private investments. In addition, the Company is seeking to find a merger
candidate. Failure to secure such financing or to raise additional equity
capital or to locate a merger candidate may result in the Company having to
discontinue its operations.
The financial statements do not include any adjustments to reflect the
possible future effects on the recoverability and classification of assets or
the amounts and classification of liabilities that may result from the
possible inability of the Company to continue as a going concern.
(4) Stockholders' Equity
During the period ended March 31, 2011, affiliates of the Company contributed
$750 in services and $5,700 in the form of payment of professional fess to
the capital of the Company.
Page 6
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR
PLAN OF OPERATIONS.
Forward-Looking Statements
The information herein contains forward-looking statements. All
statements other than statements of historical fact made herein are
forward looking. In particular, the statements herein regarding industry
prospects and future results of operations or financial position are
forward-looking statements. These forward-looking statements can be
identified by the use of words such as "believes," "estimates," "could,"
"possibly," "probably," "anticipates," "projects," "expects," "may,"
"will," or "should" or other variations or similar words. No assurances
can be given that the future results anticipated by the forward-looking
statements will be achieved. Forward-looking statements reflect
management's current expectations and are inherently uncertain. Our
actual results may differ significantly from management's expectations.
The following discussion and analysis should be read in conjunction with
our financial statements, included herewith. This discussion should not
be construed to imply that the results discussed herein will necessarily
continue into the future, or that any conclusion reached herein will
necessarily be indicative of actual operating results in the future.
Such discussion represents only the best present assessment of our
management.
General
The Company intends to seek to acquire assets or shares of an entity
actively engaged in business which generates revenues, in exchange for its
securities. The Registrant has no particular acquisitions in mind and has not
entered into any negotiations regarding such an acquisition. None of the
Company's officers, directors, promoters or affiliates have engaged in any
preliminary contact or discussions with any representative of any other
company regarding the possibility of an acquisition or merger between the
Company and such other company as of the date of this registration statement.
Page 7
While the Company will attempt to obtain audited financial statements of
a target entity, there is no assurance that such audited financial statements
will be available. The Board of Directors does intend to obtain certain
assurances of value of the target entity's assets prior to consummating such
a transaction, with further assurances that an audited statement would be
provided within four days after closing of such a transaction. Closing
documents relative thereto will include representations that the value of the
assets conveyed to or otherwise so transferred will not materially differ
from the representations included in such closing documents.
The Company has filed a registration statement on a voluntary basis
because the primary attraction of the Registrant as a merger partner or
acquisition vehicle will be its status as an SEC reporting company. Any
business combination or transaction will likely result in a significant
issuance of shares and substantial dilution to present stockholders of the
Registrant.
The Company has, and will continue to have, little capital with which to
provide the owners of business opportunities with any significant cash or
other assets. However, management believes the Company will be able to offer
owners of acquisition candidates the opportunity to acquire a controlling
ownership interest in a publicly registered company without incurring the cost
and time required to conduct an initial public offering. The owners of the
business opportunities will, however, incur significant legal and accounting
costs in connection with the acquisition of a business opportunity, including
the costs of preparing Form 8-K's , 10-K's and 10-Q's, agreements and related
reports and documents. The Securities Exchange Act of 1934 (the "34 Act"),
specifically requires that any merger or acquisition candidate comply with all
applicable reporting requirements, which include providing audited financial
statements to be included within the numerous filings relevant to complying
with the 34 Act. Nevertheless, the officer and director of the Company has
not conducted market research and is not aware of statistical data which
would support the perceived benefits of a merger or acquisition transaction
for the owners of a business opportunity.
As stated above, the Company will not acquire or merge with any
entity which cannot provide independent audited financial statements within a
reasonable period of time after closing of the proposed transaction. The
Company is subject to all of the reporting requirements included in the 34
Act. Included in these requirements is the affirmative duty of the Company to
file independent audited financial statements as part of its Form 8-K to be
filed with the Securities and Exchange Commission upon consummation of a
merger or acquisition, as well as the Company's audited financial statements
included in its annual report on Form 10-K. If such audited financial
statements are not available at closing, or within time parameters necessary
to insure the Company's compliance with the requirements
of the 34 Act, or if the audited financial statements provided do not conform
to the representations made by the candidate to be acquired in the closing
documents, the closing documents may provide that the proposed transaction
will be voidable, at the discretion of the present management of the Company.
Page 8
The Company's officer and shareholders have verbally agreed that they
will advance to the Company certain additional funds which the Company needs
for operating capital and for costs in connection with searching for or
completing an acquisition or merger. These will primarily consist of
services rendered by the Company's president, specifically S.E.C. compliance
and the due diligence required as a condition precedent to any business
combination. These persons have also agreed that such advances will be made
interest free without expectation of repayment unless the owners of the
business which the Company acquires or merges with agree to repay all or a
portion of such advances. Such repayment will in no way be a condition to
the selection of a target company. The Company will not borrow any funds
from anyone other than its current shareholders for the purpose of repaying
advances made by the shareholders, and the Company will not borrow any
fundsto make any payments to the Company's promoters, management or their
affiliates or associates.
Liquidity and Capital Resources
The Company remains in the development stage and, since
inception, has experienced no significant change in liquidity or capital
resources or stockholder's equity. The Company's balance sheet as of
March 31, 2011, reflects a current asset value of $0, and a
total asset value of $0.
The Company will carry out its plan of business as discussed
above. The Company cannot predict to what extent its liquidity and
capital resources will be diminished prior to the consummation of a
business combination or whether its capital will be further depleted by
the operating losses (if any) of the business entity which the Company
may eventually acquire.
Results of Operations
During the period from May 7, 2001 (inception) through
March 31, 2011, the Company has engaged in no significant
operations other than organizational activities, acquisition of capital
and preparation for registration of its securities under the Securities
Exchange Act of 1934, as amended. No revenues were received by
the Company during this period.
For the current fiscal year, the Company anticipates incurring
a loss as a result of organizational expenses, expenses associated with
registration under the Securities Exchange Act of 1934, and expenses
associated with locating and evaluating acquisition candidates. The
Company anticipates that until a business combination is completed
with an acquisition candidate, it will not generate revenues other than
interest income, and may continue to operate at a loss after completing
a business combination, depending upon the performance of the
acquired business.
Page 9
Critical Accounting Policies and Estimates
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States requires us to make
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. As the number of variables and
assumptions affecting the probable future resolution of the uncertainties
increase, these judgments become even more subjective and complex. Actual
results may differ from these estimates.
We have identified the following critical accounting policies, described
below, that are the most important to the portrayal of our current
financial condition and results of operations.
Basis of Reporting
The Company's financial statements are presented on a going concern basis,
which contemplates the realization of assets and satisfaction of
liabilities in the normal course of business.
The Company has experienced a loss from operations as a result of its
investment necessary to achieve its operating plan, which is long-range
in nature. The Company incurred net losses from inception to March 31,
2011, aggregating $17,700, has no revenue generating operations and is in
the development stage.
The Company's ability to continue as a going concern is contingent
upon its ability to secure additional financing, increase ownership
equity and develop profitable operations. In addition, the Company's
ability to continue as a going concern must be considered in light of
the problems, expenses and complications frequently encountered by
entrance into established markets and the competitive environment in
which the Company operates.
The Company is pursuing financing for its operations and seeking
additional private investments. In addition, the Company is seeking to
find a merger candidate. Failure to secure such financing or to raise
additional equity capital or to locate a merger candidate may result in
the Company having to discontinue its operations.
The financial statements do not include any adjustments to reflect the
possible future effects on the recoverability and classification of
assets or the amounts and classification of liabilities that may result
from the possible inability of the Company to continue as a going
concern.
Page 10
Need for Additional Financing
The Company believes that its existing capital commitments by
affiliates will be sufficient to meet the Company's cash needs, including
the costs ofcompliance with the continuing reporting requirements of the
Securities Exchange Act of 1934, as amended, for a period of
approximately one year. Accordingly, in the event the Company is
able to complete a business combination during this period, it
anticipates that its existing capital will be sufficient to allow it
to accomplish the goal of completing a business combination. There is
no assurance, however, that the available funds will ultimately prove
to be adequate to allow it to complete a business combination, and
once a business combination is completed, the Company's needs for
additional financing are likely to increase substantially.
Off-Balance Sheet Arrangements
We do not have any off balance sheet arrangements that are reasonably likely
to have a current or future effect on our financial condition, revenues,
results of operations, liquidity or capital expenditures.
ITEM 4T. CONTROLS AND PROCEDURES.
(a) Evaluation of Disclosure Controls and Procedures
Disclosure controls and procedures are controls and other procedures that
are designed to ensure that information required to be disclosed by us in
the reports that we file or submit under the Securities Exchange Act of 1934,
as amended (the "Exchange Act") is recorded, processed, summarized and
reported, within the time periods specified in the Securities and Exchange
Commission's rules and forms. Disclosure controls and procedures include,
without limitation, controls and procedures designed to ensure that
information required to be disclosed by us in the reports that we file under
the Exchange Act is accumulated and communicated to our management,
including our principal executive and financial officers, as appropriate to
allow timely decisions regarding required disclosure.
The Company's management, under the supervision and with the participation of
the Company's Chief Executive Officer and Chief Financial (and principal
accounting) Officer, carried out an evaluation of the effectiveness of the
design and operation of the Company's disclosure controls and procedures
(as defined in Rule 13a-15(e) and 15d-15(e) of the Exchange Act) as of
March 31, 2011. Based upon that evaluation, the Chief Executive Officer
and Chief Financial Officer concluded that the Company's disclosure controls
and procedures were ineffective as of the end of the period covered by this
report.
The Company continues to improve procedures with regard to its disclosure
controls and procedures.
Page 11
(b) Changes in Internal Controls.
There was no change in our internal controls over financial reporting that
has materially affected, or is reasonable likely to materially affect, our
internal control over financial reporting during the quarter covered by
this Report.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
The Company is not a party to litigation or any other legal proceedings
at this time.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.
There were no unregistered sales of the Company's equity securities during
the three months ended March 31, 2011.
There were no purchases of the Company's common stock by the Company or
its affiliates during the three months ended March 31, 2011.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
Not Applicable.
ITEM 4. (REMOVED AND RESERVED).
ITEM 5. OTHER INFORMATION.
None.
ITEM 6. EXHIBITS.
31 Certifications of the Chief Executive Officer and Chief Financial
Officer pursuant to Rule 13a-14(a)
32 Certifications of Chief Executive Officer and Chief Financial
Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002
Page 12
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Kohler Capital III, Corporation (Registrant)
Date: May 9, 2011 /s/ Gerard Werner
Gerard Werner
Chief Executive Officer(Principal Executive Officer)
Date: May 9, 2011 /s/ Gerard Werner
Gerard Werner
Chief Financial Officer(Principal Financial and Accounting Officer)
Page 13