form8-krestatement.htm
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) February 13, 2009
GSE SYSTEMS,
INC.
(Exact
name of registrant as specified in its charter)
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Delaware
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001-14785
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52-1868008
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(State
or other jurisdiction
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(Commission
File Number)
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(I.R.S.
Employer
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of
incorporation)
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Identification
No.)
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1332 Londontown Blvd,
Sykesville, MD 21784
(Address
of principal executive office and zip code)
(410)
970-7800
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 or the registrant under
any of the following provisions (see General Instructions 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 4.02. Non-Reliance on Previously Issued
Financial Statements or a Related Audit Report or Completed Interim
Review.
On
February 13, 2009, management and the Audit Committee of the Board of Directors
after discussion with KPMG LLP, the Company’s independent registered public
accounting firm, concluded that the Company will amend and restate its
previously issued financial statements for the three and nine
months ended September 30, 2008 to correct its accounting for certain
foreign currency derivative instruments. The restatement is necessary
because of an error in the reporting of the fair value of certain foreign
exchange contracts during the quarter ended September 30, 2008. The restatement
will reduce net income for both the three and nine months ended September 30,
2008 by approximately $488,000, resulting in a net loss of approximately $58,000
or $0.00 per share on both a basic and diluted basis for the three months ended
September 30, 2008 and a net loss of approximately $621,000 or ($0.04) per share
on both a basic and diluted basis for the nine months ended September 30, 2008.
The restatement will not affect the Company’s liquidity, reported revenue,
operating income or cash from operations.
The Press
Release, furnished as Exhibit 99.1 to this Form 8-K, contains the restated
financial information for the three and nine months ended September 30, 2008.
The previously reported financial statements reported on Form 10-Q for the three
and nine month periods ended September 30, 2008 should no longer be relied upon.
The Company currently expects to file an amended quarterly report on Form 10-Q
in approximately two weeks.
The
Company has two separate revolving line of credit agreements with Bank of
America, N.A. (“BOA”), in an aggregate amount of up to $5.0 million, which
expire in March 2010. As of the date hereof, the Company has no
borrowings under the credit agreements. However, the reduction in net
income of approximately $488,000 caused a default under the terms of the
revolving credit agreement. The Company and BOA are currently
discussing a waiver of such default.
The
Company discovered the error during a review of its processes and procedures
surrounding the accounting for derivative instruments. The Company’s
officers have reconsidered the effectiveness of the Company’s disclosure
controls and procedures with respect to the accounting for derivative
instruments for the periods impacted and have concluded, as a result of the
matters disclosed in the filing, that the Company’s disclosure controls and
procedures were not effective. The Company has implemented additional controls
and procedures designed to ensure its periodic filings meet the requirements of
the Securities Exchange Act of 1934, as amended. The Company will
address this reconsideration and the related conclusions in its Form 10-Q/A for
the three and nine months ended September 30, 2008.
Item
7.01. Regulation FD Disclosures.
On
February 17, 2009, the Company issued a press release announcing it will restate
the unaudited quarterly financial statements for September 30,
2008. The press release is furnished as Exhibit 99.1 to this Form
8-K.
The
information in this Item 7.01 and Exhibit 99.1 attached hereto shall not be
deemed "filed" for purposes of Section 18 of the Securities Exchange Act of
1934, nor shall it be deemed incorporated by reference in any filing under the
Securities Act of 1933 or the Securities Exchange Act of 1934, except to the
extent as shall be expressly set forth by specific reference in such
filing.
Item
9.01. Financial Statements and Exhibits.
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(d)
Exhibits.
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EXHIBIT
NUMBER
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DESCRIPTION
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Exhibit
99.1
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Press
Release dated February 17,
2009
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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.
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GSE
SYSTEMS, INC.
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Date:
February 17, 2009
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Jeffery
G. Hough
Senior
Vice President and
Chief
Financial
Officer
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