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
and Exchange Act of 1934
Date
of report: March 28, 2008
Date
of earliest event reported: March 27, 2008
AE
BIOFUELS, INC.
(Exact
name of registrant as specified in its charter)
Nevada
(State
or other jurisdiction of incorporation)
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0-51354
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84-0925128
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(Commission
File Number)
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(IRS
Employer Identification
Number)
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20400
Stevens Creek Blvd., Suite 700
Cupertino,
California 95014
(Address
of principal executive offices)
(408)
213-0940
(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:
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Written
communications pursuant to Rule 425 under the Securities Act (17
CFR
230.425)
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act
(17 CFR
240.14d-2(b))
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act
(17 CFR
240.13e-4(c))
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Item
4.02. Non-Reliance
on Previously Issued Financial Statements or a Related Audit Report of Completed
Interim Review.
On
March
27, 2008, the Audit Committee of AE Biofuels, Inc. determined that it was
necessary to restate our unaudited condensed consolidated financial statements
for the nine months ended September 30, 2007 included in the Company's Current
Report on Form 8-K which was filed with the Securities and Exchange Commission
on December 13, 2007. The restatement relates to the following correction
of
errors:
The
Company will correct its accounting treatment of warrants issued to the
Company’s placement agent for the nine months ended September 30, 2007 in
connection with the Series B private placement of the Company’s preferred stock.
This adjustment was necessary because the Company originally recorded the
fair
value of the placement agent warrants as an expense in its income statement.
The
correct accounting treatment is to record the fair value of these warrants
as a
charge to equity estimated at the time the warrants were granted. This
will
result in a reduction of general and administrative expenses and net loss
for
the period ended September 30, 2007 of $812,362. At the same time, the Company
will update and amend the condensed consolidated financial statements for
the
nine months ended September 30, 2007 in order to present them as development
stage company financial statements, and accordingly include cumulative inception
to date financial data in the statements of operations, cash flows and
stockholders equity. Additionally, the company will adjust the carry value
of an
acquired customer list from $600,000 to $300,000 to properly reflect that
a
portion of the purchase price was determined to be compensation expense that
will be recorded over a two-year vesting period specified in the purchase
agreements. Finally the Company will be making certain corrections to the
statements of cash flows to properly reflect its foreign currency cash flows,
the effects of which management is still in the process of evaluating. The
Company will also make other changes, principally in disclosure and
presentation, to bring the interim statements into alignment with the December
31, 2007 financial presentation.
As
a
result, the Company’s previously issued unaudited condensed consolidated
financial statements at and for the nine months ended September 30, 2007
should
no longer be relied upon. We will include the restated financial information
at
and for the period being restated in an amendment to the Current Report on
Form
8-K filed with the Securities and Exchange Commission on December 13, 2007,
which we expect to file within a few days of this Report.
The
Company’s Audit Committee has discussed with BDO Seidman, LLP, the Company’s
independent accountant, the matters disclosed in this Current Report.
SIGNATURES
Pursuant
to the requirement 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.
Dated:
March 28, 2008
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AE
BIOFUELS, INC.
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By: /s/
William
J. Maender
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