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
November 13, 2007
(Date of earliest event reported)
vFINANCE, INC.
(Exact Name of Registrant as Specified in Charter)
Delaware 1-11454-03 58-1974423
(State or Other Jurisdiction of (Commission File No.) (IRS Employer
Incorporation) Identification No.)
3010 North Military Trail, Suite 300
Boca Raton, Florida 33431
(Address of Principal Executive Offices)
(561) 981-1000
(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 4.02 Non-Reliance on Previously Issued Financial Statements or a
Related Audit Report or Completed Interim Review.
As previously described in the Company's Annual Report on Form 10-K for the
year ended December 31, 2006, the Company recorded adjustments as a result of
comments from the staff of the Securities and Exchange Commission ("SEC") to
reclassify marketable securities received as compensation for investment banking
services from "trading securities" to "available-for-sale" securities, effective
January 1, 2002 as part of a restatement. As a result of this reclassification,
non-cash unrealized gains and losses related to the securities classified as
available-for-sale were reclassified from the determination of net income (loss)
to accumulated other comprehensive income (loss), a component of stockholders'
equity.
On November 12, 2007, after reconsidering the adjustments to the financial
statements described in the previous paragraph, management determined that the
reclassification originally suggested by the staff of the SEC should not have
been made and, as a result, the Company revised the previously restated
financial statements as of and for the years ended December 31, 2006, 2005, 2004
and 2003. The Chief Financial Officer of the Company discussed the restatement
with the Company's independent auditors. As a consequence of reverting to the
financial statement presentation used by the Company prior to the restatement,
securities received as compensation for investment banking services have been
classified as "marketable securities" or "not readily marketable securities," as
appropriate, with realized and unrealized gains and losses related to these
securities included in the determination of net income (loss) in the
consolidated statements of operations.
As a result of the foregoing, we intend to file our December 31, 2007
Annual Report on Form 10-K with restated financial statements and revised
disclosures for the fiscal periods covered by that report.
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The specific effect of this revision on our annual consolidated statements
of operations for the years ended December 31, 2006, 2005, 2004 and 2003 will be
as follows:
Net Effect of Restatement Revision on Statements of Operations
(In thousands, except per share amounts) 2006 2005 2004 2003
---------------- ---------------- --------------- ---------------
Net income (loss), as reported $ (2,133.5) $ (999.6) $ 2,414.8 $ 320.4
Net effect of adjustments - decrease in Success
fee revenue (56.8) (244.5) (170.7) (123.6)
---------------- ---------------- --------------- ---------------
Net income (loss), as restated $ (2,190.3) $ (1,244.1) $ 2,244.1 $ 196.8
================ ================ =============== ===============
Net income (loss) per share - basic, as reported $ (0.04) $ (0.02) $ 0.07 $ 0.01
Net effect of adjustments $ - $ (0.01) $ - $ -
---------------- ---------------- --------------- ---------------
Net income (loss) per share - basic, as restated $ (0.04) $ (0.03) $ 0.07 $ 0.01
================ ================ =============== ===============
Wt. avg. shares outstanding - basic 48,714.8 40,049.7 33,773.3 26,609.1
================ ================ =============== ===============
Net income (loss) per share - diluted, as reported $ (0.04) $ (0.02) $ 0.07 $ 0.01
Net effect of adjustments $ - $ (0.01) $ (0.01) $ -
---------------- ---------------- --------------- ---------------
Net income (loss) per share - diluted, as restated $ (0.04) $ (0.03) $ 0.06 $ 0.01
================ ================ =============== ===============
Wt. avg. shares outstanding - diluted 48,714.8 40,049.7 35,840.2 29,963.4
================ ================ =============== ===============
The specific effect of this revision on our unaudited condensed
consolidated statements of operations for the quarterly periods ended March 31,
2007 and June 30, 2007 will be as follows:
Net Effect of Restatement Revision on Statements of Operations
(In thousands, except per share amounts)
3 mos. ended 3 mos. ended 6 mos. ended
March 31, 2007 June 30, 2007 June 30, 2007
(Unaudited) (Unaudited) (Unaudited)
--------------------------------------------
Net income (loss), as reported $ 37.8 $ (129.9) $ (92.1)
Net effect of adjustments - increase (decrease)
in Success fee revenue 1.7 (97.1) (95.4)
--------------- ------------- --------------
Net income (loss), as restated $ 39.5 $ (227.0) $ (187.5)
=============== ============= ==============
Net income (loss) per share - basic, as reported $ - $ - $ -
Net effect of adjustments $ - $ - $ -
--------------- ------------- --------------
Net income (loss) per share - basic, as restated $ - $ - $ -
=============== ============= ==============
Wt. avg. shares outstanding - basic 54,579.9 54,679.9 54,630.2
=============== ============= ==============
Net income (loss) per share - diluted, as reported $ - $ - $ -
Net effect of adjustments $ - $ - $ -
--------------- ------------- --------------
Net income (loss) per share - diluted, as restated $ - $ - $ -
=============== ============= ==============
Wt. avg. shares outstanding - diluted, as reported 56,125.1 54,679.9 54,630.2
=============== ============= ==============
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This revision will not affect our total shareholders' equity, but will
result in a reclassification of previously reported accumulated other
comprehensive loss to accumulated deficit in our consolidated statements of
financial condition and consolidated statements of shareholders' equity as
follows (in thousands):
Accumulated Deficit Accumulated Other Comprehensive Loss
------------------------------------------------------------ ----------------------------------------------------
Current Current
period Cumulative period Cumulative
effect of effect of effect of effect of
restate- restate- restate- restate- Restated
ment ment Restated and As ment ment and
As reported revision revision Revised reported revision revision Revised
--------------- ------------ ------------ ----------------- ------------ ----------- ----------- ------------
December 31, 2003 $ (23,431.2) $(123.6) $(170.5) $ (23,601.7) $(170.5) $123.6 $ 170.5 $ -
December 31, 2004 $ (21,016.4) $(170.7) $(341.2) $ (21,357.6) $(341.2) $170.7 $ 341.2 $ -
December 31, 2005 $ (22,016.0) $(244.5) $(585.7) $ (22,601.7) $(585.7) $244.5 $ 585.7 $ -
December 31, 2006 $ (24,149.5) $(56.8) $(642.5) $ (24,792.0) $(642.5) $ 56.8 $ 642.5 $ -
March 31, 2007 $ (24,111.7) $ 1.7 $(640.8) $ (24,752.5) $(640.8) $ (1.7) $ 640.8 $ -
June 30, 2007 $ (24,241.6) $(97.1) $(737.9) $ (24,979.5) $(737.9) $ 97.1 $ 737.9 $ -
This revision will affect neither the net change in cash nor net cash
provided by (used in) financing activities in our consolidated statements of
cash flows. However, net cash provided by (used in) operating activities will
increase and net cash provided by (used in) investing activities will decrease
in our consolidated statements of cash flows as follows (in thousands):
Cash Provided by (Used in) Operating Cash Provided by (Used in)
Activities Investing Activities
---------------------------------------------------------------------------------
Effect of Effect of
restate- Restated restate- Restated
As ment and As ment and
reported revision Revised Reported revision Revised
------------- ----------- ------------- ------------ ------------ ----------
For the six months ended June 30, 2007 $ 998.2 $47.2 $ 1,045.4 $ (6.1) $(47.2) $(53.3)
For the three months ended March 31, 2007 $ 1,116.1 $12.7 $ 1,128.8 $ (10.2) $(12.7) $(22.9)
For the year ended December 31, 2006 $ (55.6) $426.5 $ 370.9 $ 41.9 $(426.5) $(384.6)
For the year ended December 31, 2005 $(708.5) $35.2 $(673.3) $ (90.5) $(35.2) $(125.7)
For the year ended December 31, 2004 $ 1,409.8 $268.6 $ 1,678.4 $ 79.0 $(268.6) $(189.6)
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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.
vFINANCE, INC.
By: /s/ Leonard J. Sokolow
----------------------------
Name: Leonard J. Sokolow
Title: Chief Executive Officer
Date: November 13, 2007
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