Attached files
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K/A
(AMENDMENT NO. 2)
(MARK ONE)
X ANNUAL REPORT UNDER SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 2008
OR
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: 0-21802
[GRAPHIC OMITTED]
N-VIRO INTERNATIONAL CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 34-1741211
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER IDENTIFICATION NO.
INCORPORATION OR ORGANIZATION)
3450 W. CENTRAL AVENUE, SUITE 328
TOLEDO, OHIO 43606
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (419) 535-6374
SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE EXCHANGE ACT: None
SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT: Common Stock, par
value $.01 per share
Indicate by check mark if the registrant is a well-known seasoned issuer, as
defined in Rule 405 of the Securities Act. Yes No X
Indicate by check mark if the registrant is not required to file reports
pursuant to Section 13 or 15(d) of the Exchange Act. Yes 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 at least the past 90 days. Yes X No
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K (229.405 of this chapter) is not 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. [ ]
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
the definitions of "large accelerated filer", "accelerated filer" and "smaller
reporting company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer
Accelerated filer
Non-accelerated filer
Smaller reporting company X
Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act).
Yes No X
State the aggregate market value of the voting and non-voting common equity held
by non-affiliates computed by reference to the price at which the common equity
was last sold, or the average bid and asked price of such common equity, as of
the last business day of the registrant's most recently completed second fiscal
quarter: $9,350,000.
The number of shares of Common Stock of the registrant outstanding as of March
20, 2009 was 4,344,775.
DOCUMENTS INCORPORATED BY REFERENCE
None.
EXPLANATORY NOTE
----------------
We refer to N-Viro International Corporation as "N-Viro," "us," "we" and
"our" in this report.
This Amendment No. 2 to Form 10-K amends the Company's Annual Report for
the fiscal year ended December 31, 2008 to respond to certain comments from the
staff of the Securities and Exchange Commission. This Amendment does not
reflect events occurring after the original filing of the Form 10-K, and does
not modify or update the disclosures therein in any way except for changes to
the disclosures in Item 9A(T) -- Controls and Procedures - Evaluation of
Disclosure Controls and Procedures. Accordingly, this Amendment No. 2 to Form
10-K/A should be read in conjunction with the other filings of the Company made
with the Securities and Exchange Commission subsequent to the filing of the
original Annual Report on Form 10-K, including any amendments to those filings.
The staff stated in its comment letter that we must state the conclusions
of our principal executive and financial officers regarding whether our
disclosure controls and procedures are effective or not effective. The staff
also stated that we should remove our disclosure implying that the cost-benefit
relationship of possible controls and procedures is part of our effectiveness
assessment.
We have revised Item 9A(T) -- Controls and Procedures - Evaluation of
Disclosure Controls and Procedures, to include the conclusions of our principal
executive and financial officers as to the effectiveness of our disclosure
controls and procedures. We also have removed the statement in the disclosure
implying that the cost-benefit relationship of possible controls and procedures
is part of our effectiveness assessment.
ITEM 9A(T). CONTROLS AND PROCEDURES
EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES
We maintain disclosure controls and procedures (as defined in Rule
13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934) that are
designed to ensure that information required to be disclosed in our Exchange Act
reports is recorded, processed, summarized and reported within the time periods
specified in the Commission's rules and forms, and that such information is
accumulated and communicated to our management, including our principal
executive officer and principal financial officer, as appropriate, to allow
timely decisions regarding required disclosures. In designing and evaluating
the disclosure controls and procedures, management recognized that any controls
and procedures, no matter how well designed and operated, can provide only
reasonable assurance of achieving the desired control objectives.
As of the end of the period covered by this report, management carried out
an evaluation, under the supervision and with the participation of our principal
executive officer and principal financial officer, of our disclosure controls
and procedures (as defined in Rule 13a-15(e) and Rule 15d-15(e) of the Exchange
Act). Based upon the evaluation, our principal executive officer and principal
financial officer concluded that our disclosure controls and procedures were not
effective at a reasonable assurance level to ensure that information we are
required to disclose in the reports that we file or submit under the Exchange
Act is recorded, processed, summarized and reported, within the time periods
specified in the SEC's rules and forms. Our history of losses has severely
limited our budget to hire and train enough accounting and financial personnel
needed to adequately provide this function. Consequently, we lack sufficient
technical expertise, reporting standards and written policies and procedures
regarding disclosure controls and procedures.
Because of the inherent limitations in all disclosure control systems, no
evaluation of controls can provide absolute assurance that all control issues
and instances of fraud, if any, will be or have been detected. These inherent
limitations include the realities that judgments in decision-making can be
faulty and that breakdowns can occur because of simple error or mistake.
Additionally, disclosure controls can be circumvented by the individual acts of
some persons, by collusion of two or more people and/or by management override
of such controls. The design of any system of disclosure controls also is based
in part upon certain assumptions about the likelihood of future events, and
there can be no assurance that any design will succeed in achieving its stated
goals under all potential future conditions. Over time, disclosure controls and
procedures may become inadequate because of changes in conditions, and/or the
degree of compliance with the policies and procedures may deteriorate. Also,
misstatements due to error or fraud may occur and not be detected.
MANAGEMENT'S ANNUAL REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
Our management is responsible for establishing and maintaining adequate
internal control over financial reporting. Our internal control over financial
reporting is designed to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of consolidated financial statements
for external purposes in accordance with generally accepted accounting
principles.
Under the supervision and with the participation of our management,
including our Chief Financial Officer and Chief Executive Officer, we conducted
an evaluation of the effectiveness of our internal control over financial
reporting based on the framework established by the Committee of Sponsoring
Organizations of the Treadway Commission (COSO) as set forth in Internal Control
- Integrated Framework. Based on our evaluation, our principal executive
officer and our principal financial officer concluded that our internal controls
over financial reporting were not effective as of December 31, 2008 for the
reasons described below.
As stated in our Form 10-KSB for the year ended December 31, 2007, we
reported that, based on the assessment of our principal executive officer and
principal financial officer, our internal controls over financial reporting were
not effective as of December 31, 2007. We identified the following material
weakness:
We lacked personnel in accounting and financial staff to sufficiently
monitor and process financial transactions in an efficient and timely manner.
Our history of losses has severely limited our budget to hire and train enough
accounting and financial personnel needed to adequately provide this function.
Consequently, we lacked sufficient technical expertise, reporting standards and
written policies and procedures. This has resulted in a significant number of
immaterial out-of-period adjustments to our consolidated financial statements.
Specifically, controls were not effective to ensure that significant non-routine
transactions, accounting estimates, and other adjustments were appropriately
reviewed, analyzed and monitored by competent accounting staff on a timely
basis.
We continue to develop and implement a remediation plan to address the
material weakness. To date, our remediation efforts have included adoption of
an expense reimbursement policy and the hiring of an employee to assist in the
financial area of our business. However, due to our continuing lack of
financial resources to hire and train accounting and financial personnel, we
have not yet fully remedied this material weakness.
During the quarter ended December 31, 2008, there were no material changes
in the Company's internal control over financial reporting that have materially
affected, or are reasonably likely to materially affect, the Company's internal
control over financial reporting.
While we are not aware of any material errors to date, our inability to
maintain the adequate internal controls may result in a material error in our
financial statements. Further, because of its inherent limitations, internal
controls over financial reporting may not prevent or detect misstatements. It
should be noted that any system of controls, however well designed and operated,
can provide only reasonable, and not absolute, assurance that the objectives of
the system will be met. In addition, the design of any control system is based
in part upon certain assumptions about the likelihood of future events. Also,
projections of any evaluation of effectiveness to future periods are subject to
the risk that controls may become inadequate because of changes in conditions,
or that the degree of compliance with the policies or procedures may
deteriorate.
This annual report does not include an audit or attestation report of our
registered public accounting firm regarding our internal control over financial
reporting. Our management's report was not subject to audit or attestation by
our registered public accounting firm pursuant to temporary rules of the SEC
that permit us to provide only management's report in this annual report.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Exchange Act,
the registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
N-VIRO INTERNATIONAL CORPORATION
Dated: February 25, 2010
By: /s/ Timothy R. Kasmoch
---------------------------
Timothy R. Kasmoch, Chief Executive Officer and President
(Principal Executive Officer)
POWER OF ATTORNEY
Know all persons by these presents, that each person whose signature
appears below constitutes and appoints James K. McHugh his attorney-in-fact,
each with the power of substitution, for him in any and all capacities, to sign
any amendments to this Form 10-K, and to file the same, with exhibits thereto
and other documents in connection therewith, with the Securities and Exchange
Commission, hereby ratifying and confirming all that each of said
attorneys-in-fact, or his substitutes, may do or cause to be done by virtue
hereof.
Pursuant to the requirements of the Exchange Act, this report has been
signed below by the following persons on behalf of the registrant and in the
capacities and on the date indicated.
Dated: February 25, 2010
/s/ Timothy R. Kasmoch /s/ James K. McHugh
-------------------------- ----------------------
Timothy R. Kasmoch, James K. McHugh
Chief Executive Officer Chief Financial Officer,
President and Director Secretary and Treasurer
(Principal Executive Officer) (Principal Financial Officer)
/s/James H. Hartung * /s/ Mark D. Hagans *
------------------------ ------------------------
James H. Hartung, Director Mark D. Hagans,
and Chairman of the Board Director
/s/ Joseph H. Scheib* /s/Thomas L. Kovacik *
----------------------- -------------------------
Joseph H. Scheib, Director Thomas L. Kovacik, Director
/s/ Carl Richard * /s/Joan B. Wills *
--------------------- ---------------------
Carl Richard, Director Joan B. Wills, Director
* by James K. McHugh, Attorney-In-Fac
