Attached files
| file | filename |
|---|---|
| EX-31.2 - STEELCLOUD INC | v173689_ex31-2.htm |
| EX-31.1 - STEELCLOUD INC | v173689_ex31-1.htm |
UNITED
STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
10-K/A
Amendment
No. 1
x ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d)
OF
THE SECURITIES EXCHANGE ACT OF 1934
For
the fiscal year ended October 31, 2009
or
o TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d)
OF
THE SECURITIES EXCHANGE ACT OF 1934
For
the transition period from ____________ to ________________
Commission
file number 0-24015
SteelCloud,
Inc.
(Exact name of
registrant as specified in its charter)
|
Commonwealth of
Virginia
|
54-1890464
|
|
(State
or other jurisdiction of incorporation or organization)
|
(I.R.S.
Employer Identification No.)
|
|
13962 Park Center
Road, Herndon, Virginia
|
20171
|
|
(Address
of principal executive offices)
|
(Zip
Code)
|
(703)
674-5500
(Registrant’s
telephone number, including area code)
Securities registered under Section
12(b) of the Exchange Act : None.
Securities registered under Section
12(g) of the Exchange Act :
Common
stock, par value $0.001 per share.
(Title of
class)
Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act. Yes o No x
Indicate
by check mark if the registrant is not required to file reports pursuant to
Section 13 or Section 15(d) of the Act. Yes o No x
Indicate
by check mark whether the registrant: (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days.
Yes x No o
Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Website, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding
12 months (or for such shorter period that the registrant was required to submit
and post such files). Yes o No o
Indicate
by check mark if there is disclosure of delinquent filers in response to Item
405 of Regulation S-K contained herein and will not be contained, to the best of
registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. o
Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer or a smaller reporting company. See
definition of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act. (Check one):
Large
accelerated filer o Accelerated
filer o
Non-accelerated filer o Smaller
reporting company x
Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Act). Yes o No
x
The
aggregate market value of the voting stock held by non-affiliates of the issuer
as of April 30, 2009 was $2,578,652.
The
number of shares outstanding of the registrant's Common Stock on January 22,
2010 was 16,027,001.
EXPLANATORY
NOTE
This
amendment on Form 10-K/A (“Amendment No. 1”) amends SteelCloud, Inc.’s (the
“Company”) Annual Report on Form 10-K for the fiscal year
ended October 31, 2009, which was filed
with the Securities and Exchange Commission (the "Commission") on February 5,
2010 (the "2009 Form 10-K"), and is being filed to correct certain
clerical errors on the cover page, in Item 5, and in Item 10 under the heading
"Committees of the Board."
The
Company is also filing as exhibits to this Amendment No.1 the certifications
required under Section 302 of the Sarbanes-Oxley Act of 2002. Because
no financial statements are contained within this Amendment No. 1, the Company
is not including certifications pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002.
This
Amendment No. 1 is not intended to update any other information presented in the
2009 Form 10-K, except with respect to the cover page, Item 5 and Item 10
under the heading "Committees of the Board." Accordingly, this Amendment
No. 1 should be read in conjunction with the 2009 Form 10-K and the
Company’s other filings made with the Commission subsequent to the 2009 Form
10-K.
ITEM 5. MARKET FOR
REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF
EQUITY SECURITIES
Market
Information
Our
common stock was listed on The NASDAQ Stock Market, Inc.’s Capital Market from
April 22, 1997 through January 7, 2010. We changed our symbol from
“DNCC” to “SCLD” on October 19, 2000. On January 7, 2010,
our symbol was changed from “SCLD” to “SCLD.PK”. On January 27, 2010,
our symbol was changed from “SCLD.PK” to “SCLD.OB.”
The
following table sets forth the high and low selling prices as reported on the
NASDAQ Capital Market for our first fiscal quarter of 2010 through January 7,
2010 and for each fiscal quarter during the fiscal years ended October 31,
2009, 2008 and 2007. These quotations reflect inter-dealer prices
without retail mark-up, markdown, or commission and may not represent actual
transactions. On January 7, 2010 our common stock was delisted from The NASDAQ
Stock Market, Inc.’s Capital Market. Our common stock is currently
quoted on the Over-the-Counter Bulletin Board.
|
Fiscal
2007
|
||||||||
|
High
|
Low
|
|||||||
|
First
Quarter
|
$
|
1.34
|
$
|
0.61
|
||||
|
Second
Quarter
|
$
|
1.47
|
$
|
0.94
|
||||
|
Third
Quarter
|
$
|
1.74
|
$
|
1.12
|
||||
|
Fourth
Quarter
|
$
|
1.68
|
$
|
1.12
|
||||
|
Fiscal
2008
|
||||||||
|
High
|
Low
|
|||||||
|
First
Quarter
|
$
|
1.25
|
$
|
0.87
|
||||
|
Second
Quarter
|
$
|
1.21
|
$
|
0.80
|
||||
|
Third
Quarter
|
$
|
1.58
|
$
|
1.06
|
||||
|
Fourth
Quarter
|
$
|
1.26
|
$
|
0.56
|
||||
|
Fiscal
2009
|
||||||||
|
High
|
Low
|
|||||||
|
First
Quarter
|
$
|
0.75
|
$
|
0.30
|
||||
|
Second
Quarter
|
$
|
0.38
|
$
|
0.14
|
||||
|
Third
Quarter
|
$
|
0.35
|
$
|
0.15
|
||||
|
Fourth
Quarter
|
$
|
0.43
|
$
|
0.23
|
||||
|
Fiscal
2010
|
||||||||
|
High
|
Low
|
|||||||
|
First
Quarter (November 1, 2009 through January 7, 2010)
|
$
|
0.35
|
$
|
0.13
|
||||
The
following table sets forth, for January 8, 2010 through January 22, 2010, the
high and low bid prices on the over-the-counter market. These quotations reflect
the closing inter-dealer prices, without mark-up, mark-down or commission, and
may not represent actual transactions.
|
Fiscal 2010
|
||||||||
|
High
|
Low
|
|||||||
|
First
Quarter (January 7, 2010 through January 22, 2010)
|
$
|
0.16
|
$
|
0.08
|
||||
Holders
We have
16,027,001 shares of our common stock outstanding as of January 22, 2010 held by
approximately 154 stockholders of record. The number of record
holders was determined from the records of our transfer agent and does not
include beneficial owners of common stock whose shares are held in the names of
various security brokers, dealers, and registered clearing agencies
Dividend
Policy
We have
not paid cash dividends on our common stock and do not intend to do so in the
foreseeable future.
Repurchase
of Securities
We did
not repurchase any of our common stock during the fiscal year ended October 31,
2009.
Securities
Authorized For Issuance Under Equity Compensation Plans
Please
see “Item 11 – Executive
Compensation – Narrative Disclosure to Summary Compensation Table
.”
Recent
Sales Of Unregistered Securities
On
October 23, 2009, we issued 109,375 shares of our common stock to Gersten Savage
LLP in conversion of legal fees due them. These legal fees were
converted at $0.32 per share, the closing price of our common stock on October
23, 2009.
We relied
on the exemption from the registration provisions of the Securities
Act contained in Section 4(2) thereof .
Warrants
On July
1, 2009, we issued 625,000 warrants as an inducement to a lender to make a loan
valued at approximately $130,000. The warrants were issued at an
exercise price of $0.15 and expire on June 30, 2013. The fair value
of the warrants of $85,575 was determined utilizing the Black-Sholes
method.
On June
15, 2009, we issued an aggregate of 350,000 warrants to our seven
directors. These warrants are exercisable for five years from the
date of issuance at an exercise price of $0.25 per share. The
issuance to the directors was approved by our shareholders.
On
September 14, 2007, we issued 100,000 warrants in exchange for investor
relations services valued at approximately $56,000. The warrants were
issued at an exercise price of $1.28 and expire on September 14,
2012. The fair value of the warrants was estimated in four equal
tranches over a four-month vesting period using the Black-Scholes Option pricing
fair value model. On August 24, 2009, the investor relations firm
terminated its right to these 100,000 warrants, and in exchange we issued to
them 115,000 warrants at an exercise price of $0.20 and vesting
immediately. The fair value of the warrants of approximately $20,000
was estimated using the Black-Scholes Option pricing fair value
model.
NASDAQ
On March
23, 2009, we received notice, under NASDAQ Marketplace Rule 4310(c)(3), that our
common stock was subject to potential delisting from the NASDAQ Stock Market,
Inc.'s Capital Market because we did not meet the criteria of NASDAQ Listing
Rule 5550(b) (the “Rule”) and did not have a minimum of $2,500,000 in
stockholders’ equity, $35,000,000 market value of listed securities, or $500,000
of net income from continuing operations for the most recently completed fiscal
year or two of the three most recently completed fiscal years. We
provided NASDAQ with a specific plan of how we intended to achieve and sustain
compliance with all the NASDAQ Capital Market listing requirements, including a
time frame for completion of such plan. On April 28, 2009 we received
notice from NASDAQ indicating that our request for an extension of time to
regain compliance with the Rule had been granted. Pursuant to the
terms of the extension, we were required to: (a) on or before July 6, 2009,
complete an equity transaction or a merger and/or acquisition, and (b) make
appropriate disclosures to the SEC and NASDAQ on a Form
8-K. We were not able to complete an equity transaction
or a merger and/or acquisition by July 6, 2009, and on July 8, 2009, we received
written notification from NASDAQ stating that we did not meet the terms of the
extension, and that, as a result, our common stock would be subject
to delisting and trading in our common stock would be suspended at the
opening of business on July 17, 2009. On July 15, 2009, we
requested a hearing to appeal the determination before a NASDAQ Hearings Panel
(the “Panel”) and to present our plan for regaining compliance with the Rule
(the “Appeal”). On August 4, 2009, we received notice that NASDAQ
received our Appeal, and that the delisting action has been stayed, pending a
final written decision by the Panel after an oral hearing (the “Hearing”), where
we were required to demonstrate our ability to regain and sustain compliance
with the Rule. The Hearing was held at 11:00 A.M. EST, on September
3, 2009. On October 7, 2009, we received notice that the Panel
granted our request for continued listing, subject to our evidencing, on or
before January 4, 2010, compliance with the Rule and all other requirements for
continued listing. We were unable to regain compliance with the Rule
on or before January 4, 2010, and on January 5, 2010, we received notice from
NASDAQ indicating that the Panel determined to delist our securities and trading
in our securities would be suspended effective as of the open of trading on
Thursday, January 7, 2010. We do not intend to take any further
action to appeal NASDAQ's decision. Accordingly, trading of our common stock was
suspended at the opening of business on January 7, 2010, and NASDAQ will file a
Form 25-NSE with the SEC as soon as all applicable appeal periods have lapsed.
Shares of our common stock are now traded on the Over-the-Counter Bulletin
Board.
ITEM
10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
Committees
of the Board
During
the fiscal year ended October 31, 2009, the Board of Directors held a total of
ten (10) meetings (including by teleconference). All incumbent directors
attended at least 75% of the aggregate of all meetings of the Board of Directors
and any committees of the Board on which they served, during the fiscal year
ended October 31, 2009.
The Audit
Committee appoints and provides for the compensation of our independent
auditors; oversees and evaluates the work and performance of the independent
auditors; reviews the scope of the audit; considers comments made by the
independent auditors with respect to accounting procedures and internal controls
and the consideration given thereto by our management; approves all professional
services to be provided to us by our independent auditors; reviews internal
accounting procedures and controls with our financial and accounting staff;
oversees a procedure that provides for the receipt, retention and treatment of
complaints received by us and of confidential and anonymous submissions by
employees regarding questionable accounting or auditing matters; and performs
related duties as set forth in applicable securities laws, and the Audit
Committee charter (the “Audit Committee”). The Audit Committee
functions pursuant to the Audit Committee charter adopted by the Board in fiscal
2001. A copy of the Audit Committee Charter can be found on our web
site at www.steelcloud.com. The
Audit Committee met four (4) times (including by teleconference) during the
fiscal year ended October 31, 2009. The Audit Committee is currently
composed of James Bruno, VADM Burkhalter and Benjamin Krieger. The
Board has determined that all current members of the Audit Committee are
independent directors under the rules of the NASDAQ Stock Market and each
of them is able to read and understand fundamental financial
statements. The Board has determined that James Bruno is the
Company’s Audit Committee “financial expert” as defined in Item 407(d) of
Regulation S-K.
The Board
of Directors has an Executive Committee (the "Executive Committee"), the members
of which are VADM Burkhalter and Ashok Kaveeshwar. The Executive Committee
has such powers as may be assigned to it by the Board of Directors from time to
time and is currently charged with, among other things, recommending to the
Board of Directors the criteria for candidates to the Board of Directors, the
size of the Board of Directors, the number of committees of the Board of
Directors and their sizes and functions, and the nomination and selection of
Board of Directors' candidates and committee members and rotation of committee
members. In addition, the Executive Committee is responsible for
establishing and implementing an annual evaluation process for the Chief
Executive Officer and the Board of Directors and periodically assessing the
overall composition of the Board of Directors to ensure an effective membership
mix and, when appropriate, recommending to the Board of Directors a Chief
Executive Officer succession plan and succession process. The
Executive Committee met six (6) times during fiscal 2009. The
Executive Committee does not have a charter.
ITEM
15. EXHIBITS, FINANCIAL STATEMENTS AND SCHEDULES
|
The
exhibits which are filed with this report or which are incorporated by
reference are set forth in the exhibit index
hereto.
|
|
Exhibit
Number
|
Description
|
|
|
Certification
of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002.
|
||
|
*31.2
|
Certification
of Principal Financial Officer Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
|
* Filed herewith.
SIGNATURES
Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act
of 1934, the registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.
|
SteelCloud,
Inc.
|
||
|
Date:
February 12, 2010
|
By:
|
|
|
/s/
Brian H. Hajost
|
||
|
Brian
H. Hajost
|
||
|
Chief
Executive Officer
|
||
Pursuant
to and in accordance with the requirements of the Securities Exchange Act of
1934, this report has been signed by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.
|
Name
|
Title
|
Date
|
||
|
/s/
Brian H. Hajost
|
||||
|
Brian
H. Hajost
|
Chief
Executive Officer and President
|
February
12, 2010
|
||
|
/s/Steven
Snyder
|
||||
|
Steven
Snyder
|
Principal
Financial Officer
|
February
12, 2010
|
||
|
/s/VADM
E.A. Burkhalter
|
||||
|
VADM
E. A. Burkhalter USN (Ret.)
|
Director
|
February
12, 2010
|
||
|
/s/James
Bruno
|
||||
|
James
Bruno
|
Director
|
February
12, 2010
|
||
|
/s/Jay
Kaplowitz
|
||||
|
Jay
Kaplowitz
|
Director
|
February
12, 2010
|
||
|
/s/Benjamin
Krieger
|
||||
|
Benjamin
Krieger
|
Director
|
February
12, 2010
|
||
|
/s/Ashok
Kaveeshwar
|
||||
|
Ashok
Kaveeshwar
|
Director
|
February
12, 2010
|