Criticare June 30, 2006 Form 10-K/A
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
________________________
FORM
10-K/A
FOR
ANNUAL AND TRANSITION REPORTS
PURSUANT
TO SECTIONS 13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
(Mark
One)
[x] ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934.
For
the
fiscal year ended June 30, 2006
[
] 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 1-31943
Criticare
Systems, Inc.
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(Exact
Name of Registrant as Specified in Its
Charter)
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Delaware
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39-1501563
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(State
or Other Jurisdiction of
Incorporation
or Organization)
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(I.R.S.
Employer Identification No.)
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20925 Crossroads
Circle, Suite 100, Waukesha, Wisconsin
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53186
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(Address
of Principal Executive Offices)
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(Zip
Code)
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Registrant's
telephone number, including area code: 262-798-8282
Securities
registered pursuant to Section 12(b) of the Act:
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Name
of Each Exchange on
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Title
of Each Class
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Which
Registered
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Voting
Common Stock, $.04 par
value
(together
with associated
Preferred
Stock Purchase Rights)
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American
Stock Exchange
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Securities
registered pursuant to Section 12(g) of the Act:
None
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 Section 15(d) of the Exchange Act.
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 [
]
Indicate
by check mark if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K 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, or a non-accelerated filer. See definition of "accelerated
filer and large accelerated filer" in Exchange Act Rule 12b-2. (Check
one)
Large accelerated filer [ ]
Accelerated filer [ ] Non-accelerated
filer [ 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 ]
The
aggregate market value of the voting common stock held by nonaffiliates of
the
registrant as of December 30, 2005 (the last business day of the registrant’s
most recently completed second fiscal quarter) was $57,552,011. Shares of voting
common stock held as of December 30, 2005 by any person who was an executive
officer or director of the Registrant as of December 30, 2005 and any person
who
beneficially owned 10% or more of the outstanding voting common stock as of
December 30, 2005 have been excluded from this computation because such persons
may be deemed to be affiliates. This determination of affiliate status is not
a
conclusive determination for other purposes.
On August
31, 2006, there were 12,293,668 shares of the registrant's $.04 par value voting
common stock outstanding.
DOCUMENTS
INCORPORATED BY REFERENCE
Portions
of the Definitive Consent Revocation Statement filed by the Company with the
Securities and Exchange Commission on October 11, 2006 are incorporated by
reference into Part III of this report.
As
used
in this report, the terms "we," "us," "our," "Criticare" and the "Company"
mean
Criticare Systems, Inc. and its subsidiaries, unless the context indicates
another meaning, and the term "common stock" means our common stock, par value
$0.04 per share.
Special
Note Regarding Forward-Looking Statements
A
number
of the matters and subject areas discussed in this report that are not
historical or current facts deal with potential future circumstances and
developments. These include anticipated product introductions, expected future
financial results, liquidity needs, financing ability, management's or the
Company's expectations and beliefs and similar matters discussed in this report.
These statements may be identified by the use of forward-looking words or
phrases such as "anticipate," "believe," "could," "expect," "intend," "may,"
"hope," "plan," "potential," "should," "estimate," "predict," "continue,"
"future," "will," "would" or the negative of these terms or other words of
similar meaning. Such forward-looking statements are inherently subject to
known
and unknown risks and uncertainties. Our actual results and future developments
could differ materially from the results or developments expressed in, or
implied by, these forward-looking statements. Factors that may cause actual
results to differ materially from those contemplated by such forward-looking
statements include, but are not limited to, those described under the caption
"Risk Factors" in Item 1A of this report. We undertake no obligation to make
any
revisions to the forward-looking statements contained in this filing or to
update them to reflect events or circumstances occurring after the date of
this
filing.
Explanatory
Note
Criticare
Systems, Inc. (the "Company") is amending Items 10, 11, 12, 13 and 14 of Part
III of the Company's Annual Report on Form 10-K for the year ended
June 30, 2006, as filed with the Securities and Exchange Commission on
September 28, 2006 (the "Annual Report"). This amendment is being made to
incorporate by reference into Part III of the Annual Report portions of the
Company's Definitive Consent Revocation Statement filed with the Securities
and
Exchange Commission on October 11, 2006 (the "Consent Revocation
Statement").
PART
III
Item
10.
DIRECTORS
AND EXECUTIVE OFFICERS OF THE REGISTRANT.
Information
regarding the executive officers and directors of the Company is incorporated
herein by reference to the discussions under "Current Directors of Criticare,"
"Section 16(a) Beneficial Ownership Reporting Compliance" and "Executive
Officers" in the Consent Revocation Statement.
The
Audit
Committee of the Company's Board of Directors is an "audit committee" for
purposes of Section 3(a)(58)(A) of the Securities Exchange Act of 1934. The
members of the Audit Committee are Dr. Higgins D. Bailey, Dr. N.C. Joseph Lai
and Stephen K. Tannenbaum (Chairman).
The
Company's Board of Directors has determined that one of the members of the
Audit
Committee, Stephen K. Tannenbaum, qualifies as an "audit committee
financial expert" as defined by the rules of the SEC based on his work
experience and education.
The
Company has adopted a Code of Business Ethics that applies to all of the
Company's employees, including the Company's principal executive officer,
principal financial officer and principal accounting officer. A copy of the
Code
of Business Ethics is available on the Company's corporate web site which is
located at www.csiusa.com. The Company also intends to disclose any amendments
to, or waivers from, the Code of Business Ethics on its corporate web
site.
Item
11.
EXECUTIVE
COMPENSATION.
Information
regarding executive compensation is incorporated herein by reference to the
discussion under "Executive Compensation" and "Compensation of Directors" in
the
Consent Revocation Statement.
Item
12.
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SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
STOCKHOLDER MATTERS.
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Information
regarding security ownership of certain beneficial owners and management is
incorporated herein by reference to the discussion under "Security Ownership
of
Certain Beneficial Owners and Management" in the Consent Revocation
Statement.
The
following table summarizes share information for the Company’s equity
compensation plans as of June 30, 2006, including the 2003 Stock Option Plan,
the 1992 Employee Stock Option Plan, the 1992 Non-Employee Stock Option Plan,
the 1987 Employee Stock Option Plan, the 1987 Non-Employee Stock Option
Plan and
the
Company’s Employee Stock Purchase Plan.
Equity
Compensation Plan Information
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Number
of securities
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remaining
available for
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Number
of securities to be
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Weighted
average
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future
issuance under
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issued
upon exercise of
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exercise
price of
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equity
compensation
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outstanding
options,
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outstanding
options
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plans
(excluding securities
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Plan
category
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warrants
and rights
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warrants
and rights
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in
first column)
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Equity
compensation
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plans
approved by
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security
holders
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543,688
shares
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$3.17
per share
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922,232
shares
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Equity
compensation
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plans
not approved by
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security
holders
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30,000
shares
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$2.88
per share
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0
shares
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Total
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573,688
shares
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$3.15
per share
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922,232
shares
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As
noted
in the table above, the Company has issued warrants to a consultant which have
not been approved by the Company’s stockholders. The Company extended warrants
for the purchase of 30,000 shares of Common Stock issued to the consultant
expiring in February 2003 for an additional five years with an exercise price
of
$2.88 per share.
Item
13.
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CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS.
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Information
regarding certain relationships and related party transactions is incorporated
herein by reference to the discussion under "Executive Compensation—Employment
Agreements” in the Consent Revocation Statement.
Item
14.
PRINCIPAL
ACCOUNTANT FEES AND SERVICES.
The
following table summarizes the fees the Company was billed for audit and
nonaudit services rendered by the Company's independent auditors during fiscal
2006 and 2005:
Service
Type
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Fiscal
2006
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Fiscal
2005
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Audit
Fees (1)
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$
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170,060
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$
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158,428
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Audit-related
Fees
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-
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-
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Tax
Fees (2)
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19,350
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19,550
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All
Other Fees
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-
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-
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Total
Fees Billed
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$
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189,410
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$
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177,978
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________________
(1)
Consists
of fees for professional services rendered in connection with the audit of
the
Company's financial statements for the fiscal years ended June 30, 2006 and
June 30, 2005; the reviews of the financial statements included in each of
the Company's quarterly reports on Form 10-Q during those fiscal years; and
consents and assistance with documents filed by the Company with the
SEC.
(2)
Consists
of fees for tax advisory services in connection with preparation of the
Company's federal and state tax returns and I.R.S. audit.
The
Audit
Committee of the Board of Directors of the Company considered that the provision
of the services and the payment of the fees described above are compatible
with
maintaining the independence of BDO Seidman, LLP.
The
Audit
Committee is responsible for reviewing and pre-approving any non-audit services
to be performed by the Company's independent auditors. The Audit Committee
has
delegated certain of its pre-approval authority to the Chairman of the Audit
Committee to act between meetings of the Audit Committee. Any pre-approval
given
by the Chairman of the Audit Committee pursuant to this delegation is presented
to the full Audit Committee at its next regularly scheduled meeting. The Audit
Committee or Chairman of the Audit Committee reviews and, if appropriate,
approves non-audit service engagements, taking into account the proposed scope
of the non-audit services, the proposed fees for the non-audit services, whether
the non-audit services are permissible under applicable law or regulation and
the likely impact of the non-audit services on the independence of the
independent auditors.
Since
the
effective date of the SEC rules requiring pre-approval of non-audit services
on
May 6, 2003, each new engagement of the Company's independent auditors to
perform non-audit services has been approved in advance by the Audit Committee
or the Chairman of the Audit Committee pursuant to the foregoing
procedures.
PART
IV
Item
15.
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EXHIBITS
AND FINANCIAL STATEMENT
SCHEDULES.
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(a)(3) Exhibits:
The
following
exhibits are filed with this Form 10-K/A:
31.1
Certification
of Emil H. Soika, President and Chief Executive Officer (Principal Executive
Officer) pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2
Certification
of Joel D. Knudson, Vice President - Finance and Secretary (Principal Financial
Officer) pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
SIGNATURES
Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act
of 1934, the registrant has duly caused this Form 10-K/A to be signed on its
behalf by the undersigned, thereunto duly authorized.
CRITICARE
SYSTEMS, INC.
By
/s/
Emil H.
Soika
Emil
H.
Soika, President
and
Chief
Executive Officer
Date:
October 30, 2006
Pursuant
to the requirements of the Securities Exchange Act of 1934, this report has
been
signed below by the following persons on behalf of the registrant and in the
capacities and on the dates indicated.
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Signature
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Title
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Date
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/s/
Emil H. Soika
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President,
Chief Executive Officer
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October
30, 2006
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Emil
H. Soika
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and
Director (Principal Executive
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Officer)
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/s/
Joel D. Knudson
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Vice
President-Finance and Secretary
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October
30, 2006
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Joel
D. Knudson
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(Principal
Financial and Accounting
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Officer)
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*
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Chairman
of the Board and Director
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October
30, 2006
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Dr.
Higgins Bailey
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*
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Director
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October
30, 2006
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N.C.
Joseph Lai, Ph.D.
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*
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Director
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October
30, 2006
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Jeffrey
T. Barnes
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*
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Director
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October
30, 2006
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Stephen
K. Tannenbaum
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*
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Director
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October
30, 2006
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Sam
B. Humphries
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/s/
Emil H. Soika
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October
30, 2006
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Emil
H. Soika
*Attorney-in-Fact
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