UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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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 16, 2006
ULTICOM, INC.
(Exact name of registrant as specified in its charter)
NEW JERSEY 0-30121 22-2050748
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
1020 Briggs Road,
Mount Laurel, New Jersey
08054
(Address of Principal Executive Offices)
(Zip Code)
Registrant's telephone number, including area code: (856) 787-2700
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 3.01. NOTICE OF DELISTING OR FAILURE TO SATISFY A CONTINUED LISTING RULE
OR STANDARD; TRANSFER OF LISTING.
On April 17, 2006, Ulticom, Inc. (the "Company") notified The NASDAQ Stock
Market that it expects not to be in compliance with the NASDAQ requirements for
continued listing under NASDAQ Marketplace Rule 4310(c)(14), which requires the
Company to make on a timely basis all required filings with the Securities and
Exchange Commission ("SEC "). The Company expects that it will receive a Staff
Determination letter from The NASDAQ Stock Market indicating that, due to its
noncompliance with Marketplace Rule 4310(c)(14), its common stock will be
delisted unless the Company requests a hearing in accordance with the NASDAQ
Marketplace Rules. If the Company receives such a Staff Determination Letter,
the Company intends to request a hearing before the NASDAQ Listing
Qualifications Panel to review the Staff Determination letter. Under NASDAQ
Marketplace Rules, a request for a hearing stays the delisting action pending
the issuance of a written determination by the Listing Qualification Panel.
ITEM 4.02. NON-RELIANCE ON PREVIOUSLY ISSUED FINANCIAL STATEMENTS OR A RELATED
AUDIT REPORT OR COMPLETED INTERIM REVIEW.
(a) The Company today announced that, as a result of an ongoing review by its
Audit Committee relating to the Company's stock option awards, it has filed a
Form 12b-25 report with the SEC indicating that its Annual Report on Form 10-K
for the fiscal year ended January 31, 2006 will not be filed on its due date of
April 17, 2006. As previously announced on March 14, 2006, the Audit Committee
of the Board of Directors of the Company has been reviewing matters relating to
the Company's stock option awards, including but not limited to the accuracy of
the stated dates of option awards and whether all proper corporate procedures
were followed. The Company's Audit Committee is being assisted in its review by
independent legal counsel and accounting experts.
At this time, the Audit Committee has not completed its work or reached any
final conclusions. The Audit Committee is in the final stages of its review and
has reached a preliminary conclusion that the stated dates of certain of its
stock option awards, which were used in the preparation of its financial
statements, differed from the measurement dates required to be used for
accounting purposes to determine the value of such stock option awards. As a
result, the Company expects to record additional non-cash charges for
stock-based compensation expense for prior periods.
In addition, on March 14, 2006, the Company's majority shareholder, Comverse
Technology, Inc. ("Comverse"), announced that a special committee of its Board
of Directors has been reviewing matters relating to stock option awards by
Comverse. The special committee is being assisted in its review by independent
legal counsel and accounting experts, who are the same as those assisting the
Company's Audit Committee. While the Company does not participate in and is not
privy to the special committee's review, on April 17, 2006, Comverse announced
that the special committee had reached a preliminary conclusion that the stated
dates of certain of its stock option awards, which were used in the preparation
of its financial statements differed from the measurement dates required to be
used for accounting purposes to determine the value of such awards.
Consequently, the Company may also be required to record non-cash charges for
stock-based compensation expense on account of certain stock options issued by
Comverse to management and employees of the Company when the Company was a
wholly owned subsidiary of Comverse before the Company's April 2000 initial
public offering.
Based on the Audit Committee's preliminary conclusion and Comverse's
announcement, the Company expects that (i) such non-cash charges will be
material and (ii) the Company will need to restate its historical financial
statements for each of the fiscal years ended January 31, 2005, 2004, 2003 and
2002. Such charges could also affect prior periods. On April 16, 2006 the
Company concluded that such financial statements and any related reports of its
independent registered public accounting firm should no longer be relied upon.
Any such stock-based compensation charges would have the effect of decreasing
the income from operations, net income and retained earnings figures contained
in the Company's historical financial statements. The Company does not expect
that the anticipated restatements would have an impact on its historical
revenues, cash position or non-stock option related operating expenses. Nor
would any such charges impact the Company's revenues, cash position or non-stock
option related operating expenses for the year ended January 31, 2006.
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The Audit Committee has discussed with the Company's independent registered
public accounting firm the matters disclosed pursuant to this Item 4.02(a) but,
as the Committee's review has not been completed, the independent registered
public accounting firm has not yet had an opportunity to consider the results of
the review.
Additionally, the Company is evaluating its internal control over financial
reporting and reconsidering the Management's Report on Internal Control Over
Financial Reporting set forth in the Company's Annual Report on Form 10-K for
the fiscal year ended January 31, 2005. Although the Company has not yet
completed its analysis of the impact of the situation on its internal control
over financial reporting, the Company has determined that it is highly likely
that it had a material weakness in internal control over financial reporting,
which existed as of January 31, 2005 and January 31, 2006. A material weakness
is a control deficiency, or a combination of control deficiencies, that results
in more than a remote likelihood that a material misstatement of the annual or
interim financial statements will not be prevented or detected. The existence of
one or more material weaknesses as of January 31, 2005 and January 31, 2006
would preclude management from concluding that its internal control over
financial reporting was effective as of such date and result in an amendment of
Management's Report on Internal Control Over Financial Reporting as of such year
end included in the Company's Annual Report on Form 10-K for such year to state
an adverse conclusion. If the Company were to conclude that a material weakness
existed, it would expect to receive an adverse opinion on internal control over
financial reporting from its independent registered public accounting firm.
A copy of the press release disclosing the planned restatement and other matters
discussed herein is attached hereto as Exhibit 99.1 and is incorporated in this
Item 4.02(a) by reference.
Note: This Form 8-K contains "forward-looking statements" for purposes of the
Private Securities Litigation Reform Act of 1995 that involve risks and
uncertainties. There can be no assurances that forward-looking statements will
be achieved, and actual results could differ materially from forecasts and
estimates. Important factors that could cause actual results to differ
materially include: the results of the Audit Committee's review of matters
relating to the Company's stock option awards, including but not limited to the
accuracy of the stated grant dates of option awards and whether proper corporate
procedures were followed in connection with such awards; the results of
Comverse's review of its stock option awards as applicable to employees of the
Company; the impact of any restatement of the financial statements of the
Company or other actions that may be taken or required as a result of such
reviews; the Company's inability to file required reports with the Securities
and Exchange Commission; the risks that may be associated with potential claims
and proceedings relating to such matters, risk associated with the Company's
inability to meet the requirements of the NASDAQ Stock Market for continued
listing of the Company's shares; risks associated with the development and
acceptance of new products and product features; risks associated with the
Company's dependence on a limited number of customers for a significant
percentage of the Company's revenues; changes in the demand for the Company's
products; changes in capital spending among the Company's current and
prospective customers; aggressive competition that may force the Company to
reduce prices; risks associated with rapid technological changes in the
telecommunications industry; risks associated with making significant
investments in the expansion of the Company's business and with increased
expenditures; risks associated with holding a large proportion of the Company's
assets in cash equivalents and short-term investments; risks associated with the
Company's products being dependent upon their ability to operate on new hardware
and operating systems of other companies; risks associated with dependence on
sales of the Company's Signalware products; risks associated with future
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networks not utilizing signaling systems and protocols that the Company's
products are designed to support; risks associated with the products having long
sales cycles and the limited ability to forecast the timing and amount of
product sales; risks associated with the integration of the Company's products
with those of equipment manufacturers and application developers and the
Company's ability to establish and maintain channel and marketing relationships
with leading equipment manufacturers and application developers; risks
associated with the Company's reliance on a limited number of independent
manufacturers to manufacture boards for the Company's products and on a limited
number of suppliers for board components; risks associated with becoming
subjected to, defending and resolving allegations or claims of infringement of
intellectual property rights; risks associated with others infringing on the
Company's intellectual property rights and the inappropriate use by others of
the Company's proprietary technology; risks associated with the Company's
ability to retain existing personnel and recruit and retain qualified personnel;
risks associated with the increased difficulty in relying on equity incentive
programs to attract and retain talented employees and with any associated
increased employment costs; risks associated with rapidly changing technology
and the ability of the Company to introduce new products on a timely and
cost-effective basis; risks associated with changes in the competitive or
regulatory environment in which the Company operates; and other risks described
in the Company's filings with the Securities and Exchange Commission. These
risks and uncertainties, as well as others, are discussed in greater detail in
the filings of Ulticom with the Securities and Exchange Commission, including
our most recent Annual Report on Form 10-K and subsequent Quarterly Reports on
Form 10-Q. All documents are available through the SEC's website at www.sec.gov
or from Ulticom's web site at www.ulticom.com. Ulticom makes no commitment to
revise or update any forward-looking statements in order to reflect events or
circumstances after the date any such statement is made.
ITEM 8.01. OTHER EVENTS
The Company on April 17, 2006 announced that, as a result of the ongoing review
relating to the Company's stock option awards, it has filed a Form 12b-25 with
the SEC indicating that its Annual Report on Form 10-K for the fiscal year ended
January 31, 2006 will not be filed on its due date of April 17, 2006. The
Company did not seek in such filing a 15-day filing extension because it does
not believe it could file the Annual Report by the end of the extension period,
primarily due to uncertainty relating to the accounting treatment of certain
options issued by Comverse to members of the Company's management and employees
before the Company's initial public offering, as discussed above in this report.
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.
(D) EXHIBITS:
Exhibit No. Description
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99.1 Press Release of Ulticom, Inc. dated
April 17, 2006
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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 hereunto duly authorized.
ULTICOM, INC.
Date: April 17, 2006 By: /s/ Mark Kissman
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Name: Mark Kissman
Title: Chief Financial Officer
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EXHIBIT INDEX
Exhibit No. Description
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99.1 Press Release of Ulticom, Inc. dated April 17, 2006
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