Attached files
| file | filename |
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| EX-99.1 - WINDTREE THERAPEUTICS INC /DE/ | v201516_ex99-1.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
November
8, 2010
Date of
Report (Date of earliest event reported)
Discovery
Laboratories, Inc.
(Exact
name of registrant as specified in its charter)
|
Delaware
|
000-26422
|
94-3171943
|
|
(State
or other jurisdiction
of
incorporation)
|
(Commission
File Number)
|
(IRS
Employer
Identification
Number)
|
2600
Kelly Road, Suite 100
Warrington,
Pennsylvania 18976
(Address
of principal executive offices)
(215)
488-9300
(Registrant's
telephone number, including area code)
(Former
name or former address, if changed since last report)
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:
o Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
o Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
o Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
o Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
Item 2.02.
Results of Operations and Financial Condition.
On November 9, 2010, Discovery
Laboratories, Inc. (the “Company”) issued a press release highlighting the
results of operations for the quarter ended September 30, 2010. The press
release is attached as Exhibit 99.1 hereto.
In
accordance with General Instruction B.2 of Form 8-K, the information in Item
2.02 of this Current Report on Form 8-K and Exhibit 99.1 attached hereto
relating to the announcement of the results of operations for the quarter ended
September 30, 2010 and all other matters except for those discussed under the
heading “Restatement of Financial Statements” shall not be deemed “filed” for
purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), or otherwise subject to the liabilities of that section, nor
shall it be deemed incorporated by reference in any filing under the Securities
Act of 1933, as amended, or the Exchange Act, except as expressly set forth by
specific reference in any such filings.
Item
4.02. Non-Reliance on Previously Issued Financial
Statements or a Related Audit Report or Completed Interim Review.
In
connection with a review of the Company’s Annual Report on 2009 Form 10-K among
the Audit Committee of the Company’s Board of Directors (the “Audit Committee”),
and the Company’s management, with the assistance of Ernst &
Young LLP (“Ernst & Young”), the Company’s independent registered public
accounting firm, and the Company’s outside legal advisors, the Audit Committee
has reassessed the accounting classification of certain warrants issued by
the Company in May 2009 and February 2010 with respect to ASC 815 “Derivatives
and Hedging — Contracts in Entity’s Own Equity” (“ASC 815,” formerly known as
Emerging Issues Task Force Issue 00-19, “Accounting for Derivative Financial
Instruments Indexed to, and Potentially Settled in, a Company’s Own
Stock”). The review was conducted to respond to certain comments
raised by the Staff of the Securities and Exchange Commission (“SEC”) following
its periodic review of the Company’s Annual Report on Form 10-K for the year
ended December 31, 2009.
The
warrants under review are:
|
·
|
Warrants
to purchase 7,000,000 shares of common stock issued in May 2009 in
connection with a registered equity offering. The
warrants expire in May 2014 and are exercisable, subject to an aggregate
share ownership limitation, at an exercise price of $1.15 per share;
and
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·
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Warrants to purchase 13,750,000
shares of our common stock issued in February 2010 in connection with a
registered equity offering. The warrants expire in February
2015 and are exercisable, subject to an aggregate share ownership
limitation, at a price of $0.85 per
share.
|
The
Company has historically accounted for its warrants, which prior to May 2009
were issued in private transactions, as equity instruments. The
Company’s warrants generally provide that, in the event the related registration
statement or an exemption from registration is not available for the issuance or
resale of the warrant shares, the holder may exercise the warrant on
a cashless basis. However, notwithstanding the availability of
cashless exercise, ASC 815, as interpreted, appears to establish a presumption
that, in the absence of express language to the contrary, registered warrants
may be subject to net cash settlement, as it is not within the absolute control
of the Company to provide freely-tradable shares in all
circumstances. After extensive discussion, the Company’s management,
Ernst & Young, and the Company’s outside legal advisors concluded that,
although the interpretation and applicability of ASC 815 as it relates to
registered warrants is complex and subject to varying interpretations, it should
be applied based on a strict reading of the authoritative literature without
respect to any evaluation of remoteness or probability.
2
Applying
such a strict reading, the Audit Committee, together with management and in
consultation with Ernst & Young and the Company’s outside legal advisors,
determined that, notwithstanding the highly–remote and theoretical possibility
of net cash settlement, the warrants identified above should have been recorded
as liabilities, measured at fair value on the date of issue, with changes in the
fair values recognized in the Company’s quarterly statement of operations in its
quarterly financial reports. Accordingly, the Audit Committee has
also concluded on November 8, 2010 that the Company’s previously-filed
consolidated financial statements for the fiscal year ended December 31, 2009 on
Form 10-K; Ernst & Young’s reports on the financial statements and the
effectiveness of internal control over financial reporting for the fiscal year
ended December 31, 2009; each of the consolidated financial statements included
in the Company’s Quarterly Reports on Form 10-Q for the periods ended June 30,
2009, September 30, 2009, March 31, 2010 and June 30, 2010; and all related
earnings releases and similar communications issued by the Company with respect
to the foregoing, should no longer be relied upon. The
Company’s management and the Audit Committee are assessing the effect of
the pending restatements on the Company’s internal control over financial
reporting and its disclosure controls and procedures.
On or
before November 15, 2010, the Company anticipates filing an amended Annual
Report on Form 10-K for the fiscal year ended December 31, 2009 and amended
Quarterly Reports on Form 10-Q for the quarterly periods ended March 31, 2010
and June 30, 2010, each with restated financial statements reflecting the
reclassification of the warrants identified above, together with the Quarterly
Report on Form 10-Q for the period ended September 30, 2010. The
Company does not expect to amend its previously-filed Quarterly Reports on Form
10-Q for the periods ended June 30, 2009 and September 30, 2009.
The
restatements that are being implemented will reflect the reclassification of the
warrants from equity to a liability in an amount equal to the fair value of the
warrants, as of the dates of issuance, calculated using the Black Scholes option
pricing model. The restatements will have no impact on amounts
previously reported for Assets; Revenues; Operating Expenses; Cash Flows; Loans,
Equipment Loan and Accounts Payables; and Contractual
Obligations. The restatements will have no effect on the Company’s
development programs, including Surfaxin®, anticipated development milestones,
or business strategy.
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Item
8.01.
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Other
Events.
|
On November 9, 2010, the Company issued
a press release announcing the restatement and related matters referred to
in Item 4.02 to this Current Report on Form 8-K. Subject to the note relating to
the press release in Item 2.02 to this Current Report on Form 8-K, the press
release is attached as Exhibit 99.1 hereto.
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Item
9.01.
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Financial
Statements and Exhibits.
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(d)
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Exhibits
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99.1
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Press
release dated November 9,
2010
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Cautionary
Note Regarding Forward-looking Statements:
To the
extent that statements in this Current Report on Form 8-K are not strictly
historical, including statements as to business strategy, outlook, objectives,
future milestones, plans, intentions, goals, future financial conditions, future
collaboration agreements, the success of the Company’s product development or
otherwise as to future events, such statements are forward-looking, and are made
pursuant to the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. The forward-looking statements contained in this Current
Report are subject to certain risks and uncertainties that could cause actual
results to differ materially from the statements made. Such risks and others are
further described in the Company's filings with the Securities and Exchange
Commission including the most recent reports on Forms 10-K, 10-Q and 8-K, and
any amendments thereto.
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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.
| Discovery Laboratories, Inc. | |||
|
|
By:
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/s/ John G. Cooper | |
| Name: | John G. Cooper | ||
|
Title:
|
President, Chief Financial Officer and Treasurer | ||
Date: November
9, 2010
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