siga_8k.htm
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): September 28, 2010
________
SIGA TECHNOLOGIES, INC.
(Exact name of registrant as specified in its charter)
| Delaware |
0-23047 |
13-3864870 |
| (State or other jurisdiction of |
(Commission file number) |
(I.R.S. employer |
| incorporation or organization) |
|
identification no.) |
| 35 East 62nd Street |
|
|
| New York, New York |
|
10065 |
| (Address of principal executive |
|
(Zip code) |
| offices) |
|
|
Registrant’s telephone number, including area code: (212) 672-9100
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 (see General Instruction A.2. below):
¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 4.02(a) Non-Reliance on Previously Issued Financial Statements or Related Audit Report or Completed Interim Report.
On September 28, 2010, SIGA Technologies, Inc., a Delaware corporation (“SIGA” or “the Company”), concluded, based on the recommendation of management, that the previously issued consolidated financial statements for the years ended December 31, 2009 and 2008, included in the Company’s most recently filed annual report on Form 10-K, and the quarterly periods from June 30, 2008 through June 30, 2010 included in the Company’s quarterly reports on Forms 10-Q (collectively, the “Affected Financial Statements”), are no longer reliable because they failed to incorporate non-cash charges resulting from required adjustments to certain outstanding warrants (the “Warrants”). These adjustments were triggered by the application of anti-dilution provisions included in the agreements governing the Warrants and, for the quarterly periods from June 30, 2008 through June 30, 2010, have resulted in the issuance of additional warrants to acquire approximately 710,000 shares of SIGA common stock. The required non-cash charges, totaling approximately $4.54 million for the period from June 30, 2008 through June 30, 2010, were not recorded in the affected accounting periods. The Company has determined that the Affected Financial Statements should be restated to reflect these non-cash charges.
The Company has concluded that the only change required to its previously filed balance sheets and statements of operations will be the recording of the appropriate non-cash charges in the appropriate reporting periods and the effects therefrom. No other change to its previously filed balance sheets or statements of operations is anticipated.
There is no impact on net cash flows for the 2008 and 2009 annual periods and the first two 2010 quarterly periods because the changes in the fair value of common stock warrants are recorded as non-cash charges that adjust net loss to reconcile to net cash used in operating activities on the Company’s consolidated statements of cash flows.
These non-cash charges arise because the Company has accounted for the Warrants under the provisions of Emerging Issues Task Force No. 00-19 (now ASC 815), which requires that free-standing derivative financial instruments that require net cash settlement be classified as assets or liabilities at the time of the transaction, and recorded at their fair value. ASC 815 also requires that any subsequent change in the fair value of the derivative instruments be reported in earnings or loss for so long as the derivative contracts are classified as assets or liabilities.
The effects of these non-cash adjustments on the Company’s financial statements for the years ended December 31, 2009 and 2008 and the quarters ended June 30, 2010 and March 31, 2010, are detailed below, by reporting period.
The Company is currently preparing amendments to its prior filings with the Securities and Exchange Commission in order to restate its financial statements for each of the nine quarters in the period ended June 30, 2010. The Company’s management has determined that there was a material weakness in the Company’s internal control over financial reporting that did not allow for timely identification and recording with respect to anti-dilution provisions included in the Warrants. The Company is in the process of implementing additional accounting controls and procedures to remediate the internal control that was ineffective where contractual terms are reviewed on a quarterly basis to assess financial statements implications and is considering further enhancements to its existing internal controls and procedures.
The Company’s Audit Committee has discussed with the Company’s independent registered public accounting firm the matters disclosed in this filing.
- 2-
Balance Sheet Summaries
Unaudited, In Thousands
| |
|
June 30, 2010 |
| |
|
As Originally Reported |
|
Adjustments |
|
As Restated |
| Total Current assets |
|
|
19,341 |
|
|
|
|
|
|
19,341 |
|
| Total Noncurrent assets |
|
|
2,819 |
|
|
|
|
|
|
2,819 |
|
| Total assets |
|
$ |
22,160 |
|
|
|
|
|
$ |
22,160 |
|
| Total current liabilities |
|
|
9,835 |
|
|
|
|
|
|
9,835 |
|
| Common stock warrants |
|
|
8,495 |
|
|
4,543 |
|
|
|
13,038 |
|
| Total liabilities |
|
|
18,330 |
|
|
4,543 |
|
|
|
22,873 |
|
| Common Stock, Additional Paid in Capital |
|
|
|
|
|
|
|
|
|
|
|
| and Other |
|
|
103,744 |
|
|
|
|
|
|
103,744 |
|
| Accumulated deficit |
|
|
(99,914 |
) |
|
(4,543 |
) |
|
|
(104,457 |
) |
| Total stockholders' equity |
|
|
3,830 |
|
|
(4,543 |
) |
|
|
(713 |
) |
| Total liabilities and stockholders' equity |
|
$ |
22,160 |
|
|
|
|
|
$ |
22,160 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
| |
|
March 31, 2010 |
| |
|
As Originally Reported |
|
Adjustments |
|
As Restated |
| Total Current assets |
|
|
21,239 |
|
|
|
|
|
|
21,239 |
|
| Total Noncurrent assets |
|
|
2,476 |
|
|
|
|
|
|
2,476 |
|
| Total assets |
|
$ |
23,715 |
|
|
|
|
|
$ |
23,715 |
|
| Total current liabilities |
|
|
8,890 |
|
|
|
|
|
|
8,890 |
|
| Common stock warrants |
|
|
7,387 |
|
|
3,863 |
|
|
|
11,250 |
|
| Total liabilities |
|
|
16,277 |
|
|
3,863 |
|
|
|
20,140 |
|
| Common Stock, Additional Paid in Capital |
|
|
|
|
|
|
|
|
|
|
|
| and Other |
|
|
102,781 |
|
|
|
|
|
|
102,781 |
|
| Accumulated deficit |
|
|
(95,343 |
) |
|
(3,863 |
) |
|
|
(99,206 |
) |
| Total stockholders' equity |
|
|
7,438 |
|
|
(3,863 |
) |
|
|
3,575 |
|
| Total liabilities and stockholders' equity |
|
$ |
23,715 |
|
|
|
|
|
$ |
23,715 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
| |
|
December 31, 2009 |
| |
|
As Originally Reported |
|
Adjustments |
|
As Restated |
| Total Current assets |
|
|
23,487 |
|
|
|
|
|
|
23,487 |
|
| Total Noncurrent assets |
|
|
2,429 |
|
|
|
|
|
|
2,429 |
|
| Total assets |
|
$ |
25,916 |
|
|
|
|
|
$ |
25,916 |
|
| Total current liabilities |
|
|
9,029 |
|
|
|
|
|
|
9,029 |
|
| Common stock warrants |
|
|
6,398 |
|
|
3,336 |
|
|
|
9,734 |
|
| Total liabilities |
|
|
15,427 |
|
|
3,336 |
|
|
|
18,763 |
|
| Common Stock, Additional Paid in Capital |
|
|
|
|
|
|
|
|
|
|
|
| and Other |
|
|
101,422 |
|
|
|
|
|
|
101,422 |
|
| Accumulated deficit |
|
|
(90,933 |
) |
|
(3,336 |
) |
|
|
(94,269 |
) |
| Total stockholders' equity |
|
|
10,489 |
|
|
(3,336 |
) |
|
|
7,153 |
|
| Total liabilities and stockholders' equity |
|
$ |
25,916 |
|
|
|
|
|
$ |
25,916 |
|
- 3-
| |
|
December 31, 2008 |
| |
|
As Originally Reported |
|
Adjustments |
|
As Restated |
| Total Current assets |
|
|
6,255 |
|
|
|
|
|
|
|
6,255 |
|
| Total Noncurrent assets |
|
|
2,542 |
|
|
|
|
|
|
|
2,542 |
|
| Total assets |
|
$ |
8,797 |
|
|
|
|
|
|
$ |
8,797 |
|
| Total current liabilities |
|
|
4,319 |
|
|
|
|
|
|
|
4,319 |
|
| Common stock warrants |
|
|
2,924 |
|
|
|
1,553 |
|
|
|
4,477 |
|
| Total liabilities |
|
|
7,243 |
|
|
|
1,553 |
|
|
|
8,796 |
|
| Common Stock, Additional Paid in Capital |
|
|
|
|
|
|
|
|
|
|
|
|
| and Other |
|
|
72,160 |
|
|
|
|
|
|
|
72,160 |
|
| Accumulated deficit |
|
|
(70,606 |
) |
|
|
(1,553 |
) |
|
|
(72,159 |
) |
| Total stockholders' equity |
|
|
1,554 |
|
|
|
(1,553 |
) |
|
|
1 |
|
| Total liabilities and stockholders' equity |
|
$ |
8,797 |
|
|
|
|
|
|
$ |
8,797 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Statement of Operations Summaries |
|
|
|
|
|
|
|
|
|
|
| Unaudited, In Thousands |
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
Three months ended June 30, 2010 |
| |
|
As Originally Reported |
|
Adjustments |
|
As Restated |
| Revenues |
|
$ |
4,447 |
|
|
|
|
|
|
$ |
4,447 |
|
| Total operating expenses |
|
|
7,469 |
|
|
|
|
|
|
|
7,469 |
|
| Operating Loss |
|
|
(3,022 |
) |
|
|
|
|
|
|
(3,022 |
) |
| Decrease (increase) in fair value of common |
|
|
|
|
|
|
|
|
|
|
|
|
| stock rights and common stock warrants |
|
|
(1,549 |
) |
|
|
(679 |
) |
|
|
(2,228 |
) |
| Net loss |
|
$ |
(4,571 |
) |
|
$ |
(679 |
) |
|
$ |
(5,250 |
) |
| Weighted average shares outstanding: basic |
|
|
|
|
|
|
|
|
|
|
|
|
| and diluted |
|
|
43,620 |
|
|
|
|
|
|
|
43,620 |
|
| Net loss per share: basic and diluted |
|
$ |
(0.10 |
) |
|
$ |
(0.02 |
) |
|
$ |
(0.12 |
) |
| |
|
|
| |
|
Three months ended March 31, 2010 |
| |
|
As Originally Reported |
|
Adjustments |
|
As Restated |
| Revenues |
|
$ |
5,075 |
|
|
|
|
|
|
$ |
5,075 |
|
| Total operating expenses |
|
|
8,116 |
|
|
|
|
|
|
|
8,116 |
|
| Operating Loss |
|
|
(3,041 |
) |
|
|
|
|
|
|
(3,041 |
) |
| Decrease (increase) in fair value of common |
|
|
|
|
|
|
|
|
|
|
|
|
| stock rights and common stock warrants |
|
|
(1,369 |
) |
|
|
(527 |
) |
|
|
(1,896 |
) |
| Net loss |
|
$ |
(4,410 |
) |
|
$ |
(527 |
) |
|
$ |
(4,937 |
) |
| Weighted average shares outstanding: basic |
|
|
|
|
|
|
|
|
|
|
|
|
| and diluted |
|
|
43,196 |
|
|
|
|
|
|
|
43,196 |
|
| Net loss per share: basic and diluted |
|
$ |
(0.10 |
) |
|
$ |
(0.01 |
) |
|
$ |
(0.11 |
) |
- 4-
| |
|
Year ended December 31, 2009 |
| |
|
As Originally Reported |
|
Adjustments |
|
As Restated |
| Revenues |
|
$ |
13,812 |
|
|
|
|
|
|
$ |
13,812 |
|
| Total operating expenses |
|
|
25,691 |
|
|
|
|
|
|
|
25,691 |
|
| Operating Loss |
|
|
(11,879 |
) |
|
|
|
|
|
|
(11,879 |
) |
| Decrease (increase) in fair value of common |
|
|
|
|
|
|
|
|
|
|
|
|
| stock rights and common stock warrants |
|
|
(5,740 |
) |
|
|
(1,783 |
) |
|
|
(7,523 |
) |
| Other income (expense), net |
|
|
1 |
|
|
|
|
|
|
|
1 |
|
| Net loss |
|
$ |
(17,618 |
) |
|
$ |
(1,783 |
) |
|
$ |
(19,401 |
) |
| Weighted average shares outstanding: basic |
|
|
|
|
|
|
|
|
|
|
|
|
| and diluted |
|
|
37,463 |
|
|
|
|
|
|
|
37,463 |
|
| Net loss per share: basic and diluted |
|
$ |
(0.47 |
) |
|
$ |
(0.05 |
) |
|
$ |
(0.52 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
Year ended December 31, 2008 |
| |
|
As Originally Reported |
|
Adjustments |
|
As Restated |
| Revenues |
|
$ |
8,066 |
|
|
|
|
|
|
$ |
8,066 |
|
| Total operating expenses |
|
|
16,803 |
|
|
|
|
|
|
|
16,803 |
|
| Operating Loss |
|
|
(8,737 |
) |
|
|
|
|
|
|
(8,737 |
) |
| Decrease (increase) in fair value of common |
|
|
|
|
|
|
|
|
|
|
|
|
| stock rights and common stock warrants |
|
|
43 |
|
|
|
(1,553 |
) |
|
|
(1,510 |
) |
| Other income (expense), net |
|
|
94 |
|
|
|
|
|
|
|
94 |
|
| Net loss |
|
$ |
(8,600 |
) |
|
$ |
(1,553 |
) |
|
$ |
(10,153 |
) |
| Weighted average shares outstanding: basic |
|
|
|
|
|
|
|
|
|
|
|
|
| and diluted |
|
|
34,733 |
|
|
|
|
|
|
|
34,733 |
|
| Net loss per share: basic and diluted |
|
$ |
(0.25 |
) |
|
$ |
(0.04 |
) |
|
$ |
(0.29 |
) |
- 5-
SIGNATURE
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 hereunto duly authorized.
| |
SIGA TECHNOLOGIES, INC. |
| |
|
| |
By: |
/s/ Ayelet Dugary |
|
| |
|
Ayelet Dugary |
| |
|
Chief Financial Officer |
|
Date: September 28, 2010
- 6-