-----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, SiR1129iFNPCxbevtjJbGW5cUJaGkcsA2BaJXNtVxCxwJkiH4PRtsjXbjz84Gwk8 4MVDiqMbqKA+kA2VBqoJTw== 0001019687-06-001087.txt : 20060509 0001019687-06-001087.hdr.sgml : 20060509 20060509133126 ACCESSION NUMBER: 0001019687-06-001087 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20060505 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: 20060509 DATE AS OF CHANGE: 20060509 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Emrise CORP CENTRAL INDEX KEY: 0000854852 STANDARD INDUSTRIAL CLASSIFICATION: INSTRUMENTS FOR MEAS & TESTING OF ELECTRICITY & ELEC SIGNALS [3825] IRS NUMBER: 770226211 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-10346 FILM NUMBER: 06819851 BUSINESS ADDRESS: STREET 1: 9485 HAVEN AVENUE STREET 2: STE 100 CITY: RANCHO CUCAMONGA STATE: CA ZIP: 91730 BUSINESS PHONE: 9099879220 MAIL ADDRESS: STREET 1: 9485 HAVEN AVENUE STREET 2: STE 100 CITY: RANCHO CUCAMONGA STATE: CA ZIP: 91730 FORMER COMPANY: FORMER CONFORMED NAME: MICROTEL INTERNATIONAL INC DATE OF NAME CHANGE: 19951117 FORMER COMPANY: FORMER CONFORMED NAME: CXR CORP DATE OF NAME CHANGE: 19920703 8-K 1 emrise_8k-050906.txt 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) MAY 5, 2006 ----------------------- EMRISE CORPORATION - -------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) DELAWARE 001-10346 77-0226211 - ---------------------------- --------- ---------- (State or other jurisdiction (Commission (IRS Employer of incorporation) File Number) Identification No.) 9485 HAVEN AVENUE, SUITE 100, RANCHO CUCAMONGA, CALIFORNIA 91730 - -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (909) 987-9220 ---------------------- 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 (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 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION. On May 9, 2006, EMRISE Corporation ("Company") issued a press release announcing it would be filing with the Securities and Exchange Commission ("Commission") amendments to its periodic reports because it has concluded that the financial statements included in its reports covering the years ended December 31, 2005 and 2004 and interim periods during 2005 and 2004 should no longer be relied upon. A copy of the press release is attached as Exhibit 99.1 to this report. ITEM 4.02. NON-RELIANCE ON PREVIOUSLY ISSUED FINANCIAL STATEMENTS OR A RELATED AUDIT REPORT OR COMPLETED INTERIM REVIEW. On May 5, 2006, the Company's audit committee concluded that the Company's financial statements for the years ended December 31, 2005 and 2004 and the interim periods during 2005 and 2004 should no longer be relied upon. The audit committee reached this conclusion after having discussions with the Company's former independent registered public accountants and management as part of an investigation being conducted by the audit committee in response to an inquiry by the staff of the Commission's Division of Enforcement. Based upon information gathered to date in the audit committee's investigation, it appears that during the quarter ended December 31, 2004, the Company prematurely recognized approximately $224,000 of net sales of communications test equipment units that were not actually delivered to the customer during that quarter and thus did not meet all applicable revenue recognition criteria until after that quarter. These $224,000 of net sales were included in the Company's $9,768,000 and $29,861,000 of total net sales previously reported for the quarter and year ended December 31, 2004, respectively, and it appears, represented approximately $165,000 of the Company's $883,000 and $1,480,000 of net income previously reported for the quarter and year ended December 31, 2004, respectively. To the extent it is finally determined that all applicable revenue recognition criteria were met for these units during the quarter ended March 31, 2005, these $224,000 of net sales would be added to the $7,299,000 and $41,046,000 of total net sales previously reported for the quarter ended March 31, 2005 and year ended December 31, 2005, respectively, and would decrease the Company's $350,000 net loss previously reported for the quarter ended March 31, 2005 and increase the Company's $1,288,000 net income previously reported for the year ended December 31, 2005 by approximately $165,000. The audit committee's investigation has revealed that Company documentation relating to the invoicing and shipment of the above-referenced units prior to January 2005 is false and/or misleading. Responsibility for the false and/or misleading documentation and the resulting misstatement in the Company's financial statements has not been fully ascertained. The audit committee continues to investigate this situation with the assistance of outside legal and accounting professionals. The Company intends to prepare amendments to its periodic reports to reflect the change in the timing of recognition of the sales. Because the investigation by the audit committee is ongoing, the information noted above is subject to change. The Company is in the process of preparing its Form 10-Q for the quarter ended March 31, 2006, which quarterly report is due on or before May 15, 2006. However, the Company anticipates delaying the filing of its quarterly report until the audit committee's investigation is complete and the Company files its restated financial statements. ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS. (a) Financial Statements of Businesses Acquired. Not applicable. (b) Pro Forma Financial Information. Not applicable. (c) Shell Company Transactions. Not applicable. (d) Exhibits. Number Description ------ ----------- 99.1 Press release dated May 9, 2006 relating to financial statements 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. Date: May 9, 2006 EMRISE CORPORATION By: /s/ CARMINE T. OLIVA ----------------------------------------- Carmine T. Oliva, Chief Executive Officer EXHIBITS ATTACHED TO THIS REPORT Number Description ------ ----------- 99.1 Press release dated May 9, 2006 relating to financial statements EX-99.1 2 emrise_8k-ex9901.txt EXHIBIT 99.1 EMRISE CORPORATION TO RESTATE FINANCIALS RANCHO CUCAMONGA, Calif.--(BUSINESS WIRE)--May 9, 2006--EMRISE CORPORATION (NYSE Arca:ERI), a multi-national manufacturer of defense and aerospace electronic components and communications equipment, today announced that it plans to restate its financial statements for 2005 and 2004 due to the apparent premature recognition during the quarter ended December 31, 2004 of approximately $224,000 of net sales of communications test equipment units that were not actually delivered to the customer during that quarter and thus did not meet all applicable revenue recognition criteria until after that quarter. These $224,000 of net sales were included in the Company's $9,768,000 and $29,861,000 of total net sales previously reported for the quarter and year ended December 31, 2004, respectively, and it appears, represented approximately $165,000 of the Company's $883,000 and $1,480,000 of net income previously reported for the quarter and year ended December 31, 2004, respectively. To the extent it is finally determined that all applicable revenue recognition criteria were met for these units during the quarter ended March 31, 2005, these $224,000 of net sales would be added to the $7,299,000 and $41,046,000 of total net sales previously reported for the quarter ended March 31, 2005 and year ended December 31, 2005, respectively, and would decrease the Company's $350,000 net loss previously reported for the quarter ended March 31, 2005 and increase the Company's $1,288,000 net income previously reported for the year ended December 31, 2005 by approximately $165,000. The Company's audit committee is conducting an investigation into this matter in response to an inquiry by the staff of the Securities and Exchange Commission's Division of Enforcement. The audit committee's investigation has revealed that Company documentation relating to the invoicing and shipment of the above-referenced units prior to January 2005 is false and/or misleading. Responsibility for the false and/or misleading documentation and the resulting misstatement in the Company's financial statements has not been fully ascertained. The audit committee continues to investigate this situation with the assistance of outside legal and accounting professionals. The Company intends to prepare amendments to its periodic reports to reflect the change in the timing of recognition of the sales. Because the audit committee's investigation is ongoing, the information noted above is subject to change. The Company is in the process of preparing its Form 10-Q for the quarter ended March 31, 2006, which quarterly report is due on or before May 15, 2006. However, the Company anticipates delaying the filing of its quarterly report until the audit committee's investigation is complete and the Company files its restated financial statements. Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995 With the exception of historical information, the matters discussed in this press release, including without limitation, the actual types and amounts of adjustments to be made to the Company's financial statements, the periods as to which adjustments may be required, and the timing of the preparation and filing of amended and new periodic reports, are forward-looking statements that involve a number of risks and uncertainties. The actual future results could differ from those statements. Factors that could cause or contribute to such differences include, but are not limited to, additional information that may be discovered and actions that may be taken in the course of the audit committee's investigation and in connection with the Securities and Exchange Commission inquiry; any actions that any governmental, judicial or regulatory agencies may take with regard to the Company or its affiliates or customers; and other risks detailed from time to time in the Company's public statements and its periodic reports and other filings with the Securities and Exchange Commission. Contact: Carmine T. Oliva, Chief Executive Officer (909) 987-9220 -----END PRIVACY-ENHANCED MESSAGE-----