ALAMEDA, Calif., April 25 /PRNewswire-FirstCall/ -- UTStarcom, Inc. , announced today that it now expects to file its Annual Report on Form 10-K for the fiscal year ended December 31, 2005 (the "2005 Form 10-K") on or about June 1, 2006.
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The Company continues to require additional time (i) to enable the Audit Committee of the Board of Directors of the Company to complete an investigation with regard to the circumstances surrounding the previously disclosed premature recognition of revenue on a contract with a customer in India and certain other transactions and (ii) for management to complete the preparation of its 2005 consolidated financial statements and its assessment as of December 31, 2005 of the Company's internal control over financial reporting under Section 404 of the Sarbanes-Oxley Act of 2002. Additional details of the investigation and the internal control assessment can be found in the Company's press release dated March 16, 2006.
In addition, as a result of the above mentioned delay, the Company does not expect that it will be able to file its Quarterly Report on Form 10-Q for the quarter ended March 31, 2006 (the "Q1 Form 10-Q") by the May 10, 2006 deadline. As such, the Company will file a Form 12b-25 Notification of Late Filing with the SEC relating to the delay in filing the Q1 Form 10-Q. The Company expects that it will file the Q1 Form 10-Q on or about the same time it files its 2005 Form 10-K.
Nasdaq Update:
As discussed in its press release of March 22, 2006, the Company received a notice from the staff of The Nasdaq Stock Market indicating that the Company was not in compliance with Marketplace Rule 4310(c) (14) because it had not yet filed its 2005 Form 10-K. The notice indicated that due to such noncompliance, the Company's common stock would be delisted unless the Company requested a hearing in accordance with the Nasdaq Marketplace Rules.
Members of the Company's management and Board of Directors participated in a hearing before the Nasdaq Listing Qualifications Panel (the "Panel") on April 20, 2006. At the hearing, the Company requested an extension for filing the 2005 Form 10-K until June 1, 2006. Pursuant to Nasdaq procedures, UTStarcom will remain listed and continue to trade on the Nasdaq Stock Exchange pending the Panel's decision. There can be no assurance that the Panel will grant the Company's request for an extension of the 10-K filing date.
About UTStarcom, Inc.
UTStarcom is a global leader in IP-based, end-to-end networking solutions and international service and support. The company sells its broadband, wireless, and handset solutions to operators in both emerging and established telecommunications markets around the world. UTStarcom enables its customers to rapidly deploy revenue-generating access services using their existing infrastructure, while providing a migration path to cost-efficient, end-to-end IP networks. Founded in 1991 and headquartered in Alameda, California, the company has research and design operations in the United States, China, Korea and India. UTStarcom is a FORTUNE 1000 company.
For more information about UTStarcom, visit the company's Web site at http://www.utstar.com/.
Forward-Looking Statements
This release contains statements that are forward-looking in nature, including without limitation statements about the outcome of the actions being taken by the Company and its audit committee and the anticipated timing of the filing of the Company's 2005 Form 10-K and the Q1 Form 10-Q with the Securities and Exchange Commission. Such forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially. These risks include the ultimate timing and outcome of the pending investigation. The Company also refers readers to the risk factors identified in its latest Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, as filed with the Securities and Exchange Commission.
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