Unassociated Document
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
8-K
CURRENT
REPORT PURSUANT
TO
SECTION 13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
Date
of Report (Date of Earliest Event Reported) April
14,
2006
ATSI
Communications, Inc.
(Exact
Name of Registrant as Specified in Its Charter)
Nevada
(State
or
Other Jurisdiction of Incorporation
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1-15687
(Commission
File Number)
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74-2849995
(I.R.S.
Employer Identification No.)
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8600
Wurzbach, Suite 700W
San
Antonio, Texas
(Address
of Principal Executive Offices)
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78240
(Zip
Code)
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(210)
614-7240
(Registrant’s
Telephone Number, Including Area Code)
Check
the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
[
]
Written communications pursuant to Rule 425 under the Securities
Act.
[
]
Soliciting material pursuant to Rule 14a-12 under the Exchange Act
[
]
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act
[
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act
Section
8 - Other Events
Item
8.01. Other Events.
On
April
14, 2006, the Company filed an amended Annual Report on Form 10-KSB for the
fiscal year ended July 31, 2005 and amended Quarterly Reports on Form 10-QSB
for
the three months ended April 30, 2005, October 31, 2005 and January 31, 2006
to
restate the affected financial statements previously filed with the Securities
and Exchange Commission.
As
previously indicated, the Company hired outside consultants specializing in
the
accounting of derivative instruments. As a result of a thorough review of its
accounting and financial disclosure of embedded derivatives it was concluded
that the Company is required to record the conversion features and the warrants
on its balance sheet at fair value with changes in the values of these
derivatives reflected in the consolidated statement of operations as “Gain
(loss) on embedded derivative liabilities.” The following are the Gain (loss) on
embedded derivative liabilities recognized:
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For
the fiscal year ended July 31, 2005, the Company recorded a cumulative
non-cash gain on embedded derivative liabilities of $5,022,000 on its
consolidated financial statemements.
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For
the quarter ended October 31, 2005, the Company recorded a non-cash
(loss)
on embedded derivative liabilities of $48,132 on its consolidated
financial statemements.
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For
the quarter ended January 31, 2006, the Company recorded a non-cash
(loss)
on embedded derivative liabilities of $38,132 on its consolidated
financial statemements.
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The
gain
(loss) is as a result of the net unrealized (non-cash) change in the fair value
of our derivative instrument liabilities related to certain, warrants, and
embedded derivatives in the Company’s debt instruments that have been bifurcated
and accounted for separately.
For
complete financial results for the restated periods, please refer to the
Company’s amended form 10KSB and 10QSB’s for the subject periods.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, as amended, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
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ATSI
Communications, Inc. |
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Dated:
April 17, 2006
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By: |
/s/ Antonio
Estrada |
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Antonio
Estrada |
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Corporate
Controller
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