-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, SYW1Oz5J2TIHQ6I4BuQEP7kWvf1FCMUaeAX6QoHfhUQUUuvKtTH+Jbe3HXLTFoAv PYWLAV8NIDXOw7/xj0F0vQ== 0000950134-06-011782.txt : 20060619 0000950134-06-011782.hdr.sgml : 20060619 20060619172639 ACCESSION NUMBER: 0000950134-06-011782 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20060613 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Non-Reliance on Previously Issued Financial Statements or a Related Audit Report or Completed Interim Review ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20060619 DATE AS OF CHANGE: 20060619 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ATS MEDICAL INC CENTRAL INDEX KEY: 0000824068 STANDARD INDUSTRIAL CLASSIFICATION: ORTHOPEDIC, PROSTHETIC & SURGICAL APPLIANCES & SUPPLIES [3842] IRS NUMBER: 411595629 STATE OF INCORPORATION: MN FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-18602 FILM NUMBER: 06913637 BUSINESS ADDRESS: STREET 1: 3905 ANNAPOLIS LA STREET 2: SUITE 105 CITY: MINNEAPOLIS STATE: MN ZIP: 55447 BUSINESS PHONE: 6125537736 MAIL ADDRESS: STREET 1: 3905 ANNAPOLIS LANE STREET 2: SUITE 105 CITY: MINNEAPOLIS STATE: MN ZIP: 55447 FORMER COMPANY: FORMER CONFORMED NAME: ATS MEDCIAL INC DATE OF NAME CHANGE: 19920803 8-K 1 c06129e8vk.txt FORM 8-K ================================================================================ 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 EXCHANGE ACT OF 1934 DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): JUNE 13, 2006 ATS MEDICAL, INC. (Exact name of registrant as specified in its charter) Commission File Number: 0-18602 -------------- MINNESOTA 41-1595629 (State or other jurisdiction of incorporation) (IRS Employer Identification No.)
3905 ANNAPOLIS LANE N. MINNEAPOLIS, MINNESOTA 55447 (Address of principal executive offices, including zip code) (763) 553-7736 (Registrant's telephone number, including area code) NOT APPLICABLE (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: [ ] 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 2.02 RESULTS OF OPERATION AND FINANCIAL CONDITION. On June 19, 2006, ATS Medical, Inc. (the "Company") issued a press release reporting that the Company intends to restate its audited financial statements for the year ended December 31, 2005 and its unaudited financial statements for the quarter ended March 31, 2006 to reflect separate accounting for embedded derivatives within its 6% Convertible Senior Notes due 2025 (the "Notes"). The full text of the press release is furnished as Exhibit 99 hereto and is incorporated herein by reference. As previously reported in a Form 8-K filed on June 9, 2006, John R. Judd, the Company's Chief Financial Officer, has accepted a position with another company and will be leaving the Company later this month. In the press release issued on June 15, 2006, the Company noted that Mr. Judd's resignation was not related to the restatement of these financial statements. The information in Item 2.02 of this Current Report on Form 8-K, including the exhibit hereto, is not deemed "filed" for purposes 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 to be 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 such filing. ITEM 4.02 NON-RELIANCE ON PREVIOUSLY ISSUED FINANCIAL STATEMENTS OR A RELATED AUDIT REPORT OR COMPLETED INTERIM REVIEW. (a) In October 2005, the Company sold $22.4 million aggregate principal amount of the Notes, which are convertible into shares of the Company's common stock at any time at a conversion price of $4.20 per share. If fully converted, the Notes would convert into 5,333,334 shares of the Company's common stock. The Company does not currently have enough shares of unissued, authorized common stock to settle all of the Notes upon conversion. On June 13, 2006, the Company's management determined that, because of this lack of sufficient authorized shares, this conversion right must be bifurcated and separately accounted for under FASB Statement No. 133, Accounting for Derivative Instruments and Hedging Activities, and should be treated as a derivative that must be marked-to-market through earnings. Therefore, the Company concluded that its previously filed financial statements for the year ended December 31, 2005 and the quarter ended March 31, 2006 should no longer be relied upon and should be restated. While the exact amounts involved have not been finalized, the Company's management believes that net loss for the year ended December 31, 2005 and the quarter ended March 31, 2006 will be reduced. Management's conclusion that the financial statements should no longer be relied upon was discussed with Ernst & Young LLP, the Company's independent registered public accounting firm, and the Company's Audit Committee at a meeting held on June 13, 2006. At that meeting, the Audit Committee accepted and agreed with management's determination regarding the need for restatement of the financial statements for the year ended December 31, 2005 and the quarter ended March 31, 2006. The Company will file with the Securities and Exchange Commission an amended Form 10-K for the fiscal year ended December 31, 2005 and an amended Form 10-Q for the quarter ended March 31, 2006, which will include restated financial statements. The Company intends to file such amended reports as soon as practicable. ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS. (d) Exhibits 99.1 Press Release, dated June 19, 2006, of ATS Medical, Inc. 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. ATS MEDICAL, INC. By: /s/ Michael D. Dale --------------------------------- Michael D. Dale Chief Executive Officer Date: June 19, 2006 EXHIBIT INDEX 99.1 Press Release, dated June 19, 2006, of ATS Medical, Inc. EX-99.1 2 c06129exv99w1.txt PRESS RELEASE EXHIBIT 99.1 [ATS MEDICAL COMPANY LOGO] Contacts: ATS Medical, Inc. Michael Dale President and CEO, 763-557-2224 Jack Judd CFO, 763-557-2222 Investors: Media: Douglas Sherk, 415-652-9100 Steve DiMattia, 646-277-8706 Jennifer Beugelmans, 415-896-6820 Sheryl Seapy, 949-608-0841 FOR IMMEDIATE RELEASE ATS MEDICAL ANNOUNCES INTENTION TO AMEND 2005 FORM 10-K AND FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2006 TO SEPARATELY ACCOUNT FOR DERIVATIVES WITHIN ISSUED CONVERTIBLE SENIOR NOTES MINNEAPOLIS, MN, June 19, 2006 -- ATS Medical, Inc. (Nasdaq: ATSI), developer, manufacturer and marketer of state-of-the-art cardiac surgery products and services, today announced its audited financial statements for the year ended December 31, 2005 and its unaudited financial statements for the quarter ended March 31, 2006, will be restated to reflect separate accounting for embedded derivatives within its 6% Convertible Senior Notes due 2025 sold in October 2005. While the exact amounts involved have not been finalized, the Company believes that the restatement will lower net losses for the year ended December 31, 2005 and the quarter ended March 31, 2006. In October 2005, ATS Medical sold $22.4 million in aggregate principal amount of its 6% Convertible Senior Notes due 2025, which are convertible into shares of the Company's common stock at any time at a conversion price of $4.20 per share. If fully converted, the Notes would convert into 5,333,334 shares of the Company's common stock. ATS Medical does not currently have enough shares of unissued, authorized common stock to settle all of the Notes upon conversion. On June 13, 2006, ATS Medical's management and the Audit Committee of its Board of Directors determined that because of this lack of sufficient authorized shares the conversion right under the Notes must be bifurcated and separately accounted for under FASB Statement No. 133, Accounting for Derivative Instruments and Hedging Activities, and should be treated as a derivative that must be marked-to-market through earnings. As a result of this determination, the Company concluded that its previously filed financial statements for the year ended December 31, 2005 and the quarter ended March 31, 2006 would have to be restated. ATS Medical will file with the Securities and Exchange Commission an amended Form 10-K for the fiscal year ended December 31, 2005 and an amended Form 10-Q for the quarter ended March 31, 2006, which will include restated financial statements. The Company intends to file such amended reports as soon as practicable. Michael Dale, Chairman and CEO of ATS Medical commented, "While responding to comments received from the SEC on our Form S-4 registration statement relating to the proposed acquisition of 3F Therapeutics, Inc., we realized that an error had been made in our previously filed financial statements. It is important that investors understand that these anticipated adjustments are non-cash and are recorded below the operating income line. None of our reporting related to sales or operating expenses will be restated. The amendment is entirely related to our convertible notes sold in October 2005 and the fact that we have insufficient unissued, authorized common stock to settle all of the Notes upon conversion. As was disclosed to the purchasers of the Notes in the offering last October, we will be seeking approval for additional authorized common stock at our next shareholders meeting. Obtaining this approval will allow us to cease separately accounting for this conversion right as a derivative." Mr. Dale continued, "I also want to emphasize that Jack Judd's recent decision to accept the position of Chief Financial Officer at a privately held company is unrelated to this restatement. Our current finance team, including Jack, is now working diligently to prepare and file the appropriate amendments." ABOUT ATS MEDICAL ATS Medical, Inc. manufacturers and markets products and services focused on cardiac surgery. The Company, global in scope, has been headquartered in Minneapolis since its founding in 1991. More than 100,000 ATS Open Pivot(R) Heart Valves, which utilize a unique pivot design resulting in exceptional performance and low risk profile, have been implanted in patients worldwide. ATS Medical's focus on serving the cardiac surgery community is further strengthened by product and service offerings including ATS Simulus annuloplasty products for heart valve repair, Surgi-Frost(R) and Frost-Byte(R) products for surgical cryoablation of cardiac arrhythmias, RTI-Cardiovascular for allograft tissue services, QAS home monitoring services for anticoagulation therapy, and the development of PARSUS blood filtration technology. The ATS Medical web site is http://www.atsmedical.com. SAFE HARBOR This news release contains forward-looking statements that may include statements regarding intent, belief or current expectations of the Company and its management. Actual results could differ materially from those projected in the forward looking statements as a result of a number of important factors, including the successful completion of the 3F Therapeutics acquisition, which is subject to the satisfaction of various conditions, including approval by the shareholders of ATS, as well as regulatory actions, competition, pricing pressures, supplier actions and management of growth. For a discussion of these and other risks and uncertainties that could affect the Company's activities and results, please refer to the Company's filings with the Securities and Exchange Commission including its Annual Report on Form 10-K for the year ended December 31, 2005. -----END PRIVACY-ENHANCED MESSAGE-----