Item
4.02. Non-Reliance
on Previously Issued Financial Statements or a Related Audit
Report.
(a)
*
This
8-K was prepared and submitted for filing on November 10, 2006. Due to
an
administrative error, the Company’s outside filer failed to submit it to the
SEC. The filing is being completed now promptly following the Company’s
discovery of the error.
On
November 10, 2006, the Company concluded, based on the recommendation of
its
independent auditors to restate previously-issued financial statements
included
in the Company’s Annual Report on Form 10-K for fiscal years ended March 27,
2005 and March 30, 2006 and in the Quarterly Report on Form 10-Q for the
fiscal
quarter ended June 30, 2006. The Company’s previously-issued financial
statements for these periods should, therefore, no longer be relied upon.
Following
lengthy discussions between the Company’s independent auditors (the “Auditors”)
and the PCAOB, the Auditors informed Management of the PCAOB views as to
the
calculation of non-cash interest expense and the intrinsic value of beneficial
conversion features of the Company’s outstanding convertible notes. Management
discussed these issues with the Board at a meeting held on October 31,
2006. The
Audit Committee subsequently met with the Company’s Auditors to review the PCAOB
guidance. On November 10, 2006,
the
Company’s full Board of Directors determined to restate the Company’s financial
statements in accordance with the PCAOB guidance. The restatements do not
have
any impact on the Company’s statements of cash flows. The Company will file
amended Form 10-Ks and a Form 10-Q for the relevant periods on November
10,
2006.
On
November 10, 2006, the Company issued a press release regarding the restatement.
A copy of the press release is attached as Exhibit 99.1 to this Current
Report
on Form 8-K and is incorporated by reference herein.