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): March 4,
2020
IOTA COMMUNICATIONS, INC.
(Exact name of registrant as specified in its charter)
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Delaware
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000-27587
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22-3586087
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(State or other jurisdiction of incorporation)
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(Commission File Number)
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(IRS Employer Identification No.)
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600 Hamilton Street, Suite 1010
Allentown, PA 18101
(Address of principal executive offices)
Registrant’s telephone number, including area code: (855)
743-6478
N/A
(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):
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☐
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Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
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Securities
registered pursuant to Section 12(b) of the Act: None
Indicate
by check mark whether the registrant is an emerging growth company
as defined in Rule 405 of the Securities Act of 1933 (§230.405
of this chapter) or Rule 12b-2 of the Securities Exchange Act of
1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by
check mark if the registrant has elected not to use the extended
transition period for complying with any new or revised financial
accounting standards provided pursuant to Section 13(a) of the
Exchange Act. ☐
ITEM 4.02
Non-Reliance on Previously Issued Financial Statements or a Related
Audit Report or Completed Interim Review.
On March 4, 2020, the Board of Directors of Iota Communications,
Inc. (the “Company”), after discussion with management
of the Company and the Company’s independent registered
public accounting firm, Friedman LLP, concluded that the
Company’s previously issued unaudited condensed consolidated
interim financial statements as of and for the three and six months
ended November 30, 2019 included in the Company’s Quarterly
Report on Form 10-Q and Form 10-Q/A for such period filed with the
Securities and Exchange Commission (the “SEC”) on
January 22, 2020, should no longer be relied upon. Similarly,
management’s reports on the effectiveness of internal
controls over financial reporting, earnings releases, and investor
communications describing the financial statements for this period
should no longer be relied upon.
In a press release dated November 13, 2019, the Company provided an
update on the status of its balance sheet improvement initiative
and its targeted removal of $100 million of debt during fiscal year
2020. In connection with this initiative, the Company settled the
outstanding revenue-based note liability in connection with its
Solutions Pool Program in the amount of $6.3 million, net of
unamortized deferred financing costs, during the fiscal quarter
ended November 30, 2019. The Company has determined that it failed
to disclose and properly record the extinguishment of these
revenue-based notes in exchange for future cash consideration of
approximately $3.4 million and shares of its common stock valued at
approximately $7.0 million as of the date of exchange. The Company
expects the corrected misstatement to have the following impact on
its restated condensed consolidated interim financial statements as
of and for the three and six months ended November 30,
2019:
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Decrease
non-current liabilities by approximately $2.9 million,
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Increase
common stock and additional paid-in capital by approximately $7.0
million,
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Decrease
net income and increase accumulated deficit by approximately $4.1
million, and
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No
impact on its reported cash balance at November 30,
2019.
The Company will restate its previously issued unaudited condensed
consolidated interim financial statements as of and for the three
and six months ended November 30, 2019 through the filing of an
amended Quarterly Report on Form 10-Q for such period (the
“Restatement”). This amended Form 10-Q/A2 will be filed
with the SEC as soon as reasonably practicable. The Restatement
does not impact the Company’s previously issued audited
consolidated financial statements as of and for the year ended May
31, 2019 or any other prior period.
Forward-Looking Statements
Certain statements included in this Form 8-K are
“forward-looking statements” within the meaning of the
Private Securities Litigation Reform Act of 1995. These statements
include statements regarding the effects of the restatement of the
Company’s past financial statements and the expected timing
of filing of the Company’s amended Quarterly Report on Form
10-Q. Forward-looking statements may involve known and unknown
risks, uncertainties, and other factors that may cause actual
results, performance, or achievements of the Company to be
materially different from historical results or from any future
results or projections expressed or implied by such forward-looking
statements. Accordingly, readers should not place undue reliance on
any forward-looking statements. In addition to statements that
explicitly describe such risks and uncertainties, readers are urged
to consider statements in the conditional or future tenses or that
include terms such as “believes,” “belief,”
“expects,” “estimates,”
“intends,” “anticipates,” or
“plans” to be uncertain and forward-looking. Factors
that may cause actual results to differ materially from current
expectations include, among other things, those listed under Part
I, Item 1A. “Risk Factors” in our Annual Report on Form
10-K for the fiscal year ended May 31, 2019 and the Company’s
other filings with the SEC. Except as required by law, the Company
assumes no obligation to update or revise these forward-looking
statements for any reason, even if new information becomes
available in the future.
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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.
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IOTA
COMMUNICATIONS, INC.
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Date: March 6,
2020
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By:
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/s/ Terrence
DeFranco
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Name:
Terrence
DeFranco
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Title:
Chief
Executive Officer
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