0001104659-16-156233.txt : 20161110 0001104659-16-156233.hdr.sgml : 20161110 20161110161039 ACCESSION NUMBER: 0001104659-16-156233 CONFORMED SUBMISSION TYPE: NT 10-Q PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20160930 FILED AS OF DATE: 20161110 DATE AS OF CHANGE: 20161110 EFFECTIVENESS DATE: 20161110 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TANGOE INC CENTRAL INDEX KEY: 0001182325 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-PREPACKAGED SOFTWARE [7372] IRS NUMBER: 061571143 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: NT 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-35247 FILM NUMBER: 161988150 BUSINESS ADDRESS: STREET 1: 35 Executive Boulevard CITY: Orange STATE: CT ZIP: 06477 BUSINESS PHONE: 203-859-9300 MAIL ADDRESS: STREET 1: 35 Executive Boulevard CITY: Orange STATE: CT ZIP: 06477 NT 10-Q 1 a16-21415_1nt10q.htm NT 10-Q

 

 

 

 

 

 

 

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

 

FORM 12b-25

 

NOTIFICATION OF LATE FILING

 

 

 

 

 

 

SEC FILE NUMBER
001-35247

CUSIP NUMBER
87582Y108

 

(Check one):

 

o Form 10-K

o Form 20-F

o Form 11-K

x Form 10-Q

o Form 10-D

 

 

o Form N-SAR

o Form N-CSR

 

 

 

 

 

 

 

 

 

 

 

 

For Period Ended:

September 30, 2016

 

 

o Transition Report on Form 10-K

 

 

 

 

o Transition Report on Form 20-F

 

 

 

 

o Transition Report on Form 11-K

 

 

 

 

o Transition Report on Form 10-Q

 

 

 

 

o Transition Report on Form N-SAR

 

 

 

 

For the Transition Period Ended:

 

 

Read Instructions (on back page) Before Preparing Form. Please Print or Type.
Nothing in this form shall be construed to imply that the Commission has verified any information contained herein.

 

If the notification relates to a portion of the filing checked above, identify the Item(s) to which the notification relates:

 


 

PART I — REGISTRANT INFORMATION

 

Tangoe, Inc.

Full Name of Registrant

 

 

Former Name if Applicable

 

35 Executive Boulevard

Address of Principal Executive Office (Street and Number)

 

Orange, CT 06477

City, State and Zip Code

 

PART II — RULES 12b-25(b) AND (c)

 

If the subject report could not be filed without unreasonable effort or expense and the registrant seeks relief pursuant to Rule 12b-25(b), the following should be completed. (Check box if appropriate)

 

 

(a)

The reason described in reasonable detail in Part III of this form could not be eliminated without unreasonable effort or expense

o

(b)

The subject annual report, semi-annual report, transition report on Form 10-K, Form 20-F, Form 11-K, Form N-SAR or Form N-CSR, or portion thereof, will be filed on or before the fifteenth calendar day following the prescribed due date; or the subject quarterly report or transition report on Form 10-Q or subject distribution report on Form 10-D, or portion thereof, will be filed on or before the fifth calendar day following the prescribed due date; and

 

(c)

The accountant’s statement or other exhibit required by Rule 12b-25(c) has been attached if applicable.

 



 

PART III — NARRATIVE

 

State below in reasonable detail why Forms 10-K, 20-F, 11-K, 10-Q, 10-D, N-SAR, N-CSR, or the transition report or portion thereof, could not be filed within the prescribed time period.

 

Tangoe, Inc. (the “Company”) has determined that it is unable to file its Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2016 within the prescribed time period without unreasonable effort or expense for the following reason.

 

As reported in the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission (the “SEC”) on March 7, 2016, the Board of Directors of the Company (the “Board”), upon the recommendation of the Audit Committee of the Board (the “Audit Committee”), determined that the Company will restate its financial statements for the years 2013 and 2014, all quarters therein, and the first three quarters of 2015.  The Company has concluded that it made errors in recognizing revenue and is revising its historical financial statements and revenue recognition policies for several categories of revenue.  In addition, the Company expects to make adjustments to certain non-revenue items in its historical financial statements consistent with its correction of revenue recognition errors, and to make other immaterial adjustments, including with respect to the reversal of certain stock-based compensation expense.

 

Because the Company is in the process of restating its financial statements as described above, the Company has not been able to complete the financial statements required to be included in its Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2016 (the “September 30, 2016 Form 10-Q”) and, accordingly, is unable to file the September 30, 2016 Form 10-Q within the prescribed time period.  The internal investigation overseen by the Audit Committee in connection with the restatement is substantially complete. The Company has also substantially completed its internal review of the financial statements for the periods being restated and is currently working with the Company’s independent registered public accounting firm as it audits the restated year-end financial statements.  In addition, the Company is completing its closing procedures and preparing interim financial statements for its quarters ending March 31, 2016, June 30, 2016 and September 30, 2016, after which it will work with its independent registered public accounting firm as it reviews the interim financial statements.  Presently, the Company is unable to estimate a date by which all of the above procedures, and the audit or review of its financial statements, as applicable, by its independent registered public accounting firm, will be completed.

 

The Company will file the September 30, 2016 Form 10-Q and the financial statements for prior periods following completion of this audit and review by its independent registered public accounting firm.  Because the restatement was not completed prior to September 12, 2016, the Company sought a further extension from NASDAQ of the period of time in which it could regain compliance with NASDAQ’s filing requirement and on November 3, 2016 appeared before a NASDAQ Hearings Panel (the “Panel”) to formally present its request.  On November 9, 2016, the Panel determined to continue the Company’s listing until March 10, 2017, the maximum extension that was available to the Panel under the NASDAQ Listing Rules, subject to several requirements. While the Company is hopeful that it will regain compliance with NASDAQ’s filing requirement by March 10, 2017, no assurances can be provided that the Company will be able to do so.

 

2



 

PART IV — OTHER INFORMATION

 

(1)

Name and telephone number of person to contact in regard to this notification

 

Jay Zager

 

(203)

 

859-9300

 

(Name)

 

(Area Code)

 

(Telephone Number)

 

 

(2)

Have all other periodic reports required under Section 13 or 15(d) of the Securities Exchange Act of 1934 or Section 30 of the Investment Company Act of 1940 during the preceding 12 months or for such shorter period that the registrant was required to file such report(s) been filed? If answer is no, identify report(s).

 

 

 

 

 

 

 

o Yes    x No

 

 

 

 

 

 

 

The Company has not filed its Annual Report on Form 10-K for its fiscal year ended December 31, 2015 or its Quarterly Reports on Form 10-Q for the quarterly periods ended March 31, 2016 and June 30, 2016.

 

 

 

 

 

 

(3)

Is it anticipated that any significant change in results of operations from the corresponding period for the last fiscal year will be reflected by the earnings statements to be included in the subject report or portion thereof?

 

 

 

 

 

 

 

x Yes    o No

 

 

 

 

 

 

 

If so, attach an explanation of the anticipated change, both narratively and quantitatively, and, if appropriate, state the reasons why a reasonable estimate of the results cannot be made.

 

In the Company’s press release announcing the restatement on March 7, 2016, the Company estimated that at least $17.1 million of previously recognized revenue would be affected, comprised of previously recognized revenue of at least $3.4 million for 2013, $9.4 million for 2014 and $4.3 million for the first three quarters of 2015.  In the Company’s Notification of Late Filing of Form 12b-25 filed with the SEC on August 10, 2016, the Company disclosed an expectation that at least $18.5 million of previously recognized revenue would be affected, plus up to a further $10 million in reduction of previously recognized revenue relating to additional items that were under review by the Company.  Subject to any items that may come to light during the ongoing audit of the Company’s revised financial statements for the restatement periods or the ongoing preparation of interim financial statements for periods in 2016, the Company has completed its review for all periods in question, and now estimates that the aggregate net revenue reduction for the restatement periods will be approximately $30.5 million, and that operating income will be adjusted substantially in line with the revenue reductions.  The table below details the expected net reductions to revenue and pre-tax net income by period:

 

Key Metrics — Revenue

 

($ millions)

 

FY’13

 

FY’14

 

FY’15 as of
Q3’15

 

Total

 

Revenue (As Originally Reported)

 

188.9

 

212.5

 

164.5

 

565.9

 

Reduction to Originally Reported Revenue

 

-9.3

 

-14.2

 

-7.0

 

-30.5

 

Revenue (As Adjusted)

 

179.6

 

198.3

 

157.6

 

535.4

 

 

Key Metrics — Pre-Tax Net Income

 

($ millions)

 

FY’13

 

FY’14

 

FY’15 as of

Q3’15

 

Total

 

Income/(Loss) Before Income Tax Provision (As Originally Reported)

 

6.0

 

5.3

 

-4.9

 

6.3

 

Reduction to Originally Reported Pre-Tax Net Income

 

-8.7

 

-14.9

 

-7.4

 

-31.0

 

Loss Before Income Tax Provision (As Adjusted)

 

-2.7

 

-9.6

 

-12.3

 

-24.7

 

 

Of this net revenue reduction, approximately $14.0 million or 46% represents a permanent reduction in revenue and the balance of $16.5 million or 54% results from timing issues where the affected revenue is expected to be

 

3



 

recognized in periods subsequent to the restatement periods.  The aggregate net revenue reduction of approximately $30.5 million is comprised of approximately $20.1 million of recurring technology and services revenue and approximately $10.4 million of strategic consulting and other revenue.

 

The Company’s cash balance as of September 30, 2016 was $23.1 million, after payment between January 1, 2016 and September 30, 2016 of approximately $10 million in severance costs and one-time fees incurred in connection with its investigation and restatement efforts, and the Company’s outstanding indebtedness as of September 30, 2016 was less than $5.0 million, primarily consisting of vendor financing of hardware and product platform software.

 

4



 

Forward-looking statements

 

Except for statements of historical fact, the matters discussed in this Form 12b-25 are “forward-looking statements” within the meaning of the applicable securities laws and regulations. The words “estimates”, “expects” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Forward-looking statements, including statements regarding the Company’s intent to restate its prior financial statements, the estimated adjustments of the restated financials and the timing of the Company’s completion of its internal review of the financial statements for the periods being restated involve risks and uncertainties that may cause actual results to differ materially from those stated here. Factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to, the risk that additional information may arise from the completion of an audit of the Company’s financial statements or from the preparation of interim financial statements for periods in 2016, the risk that the process of preparing and auditing the restated financial statements or other subsequent events would require the Company to make additional adjustments and the time and effort required to complete the restatement of its financial statements, as well as other risks described more fully in the Company’s filings with the SEC. Forward-looking statements reflect management’s analysis as of the date hereof. The Company does not undertake to revise these statements to reflect subsequent developments.

 

Tangoe, Inc.


(Name of Registrant as Specified in Charter)

 

has caused this notification to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

Date

November 10, 2016

 

By

/s/ Jay Zager

 

 

 

Name: Jay Zager

 

 

 

Title: Chief Financial Officer

 

INSTRUCTION: The form may be signed by an executive officer of the registrant or by any other duly authorized representative. The name and title of the person signing the form shall be typed or printed beneath the signature. If the statement is signed on behalf of the registrant by an authorized representative (other than an executive officer), evidence of the representative’s authority to sign on behalf of the registrant shall be filed with the form.

 

 

ATTENTION

 

Intentional misstatements or omissions of fact constitute Federal Criminal Violations (See 18 U.S.C. 1001).

 

5