================================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
AMENDMENT NO. 1
TO
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): December 31, 2003
Commission File Number: 0-12742
SPIRE CORPORATION
--------------------------------------------------
(Exact name of Registrant as specified in charter)
MASSACHUSETTS 04-2457335
---------------------------- ----------------
(State or other jurisdiction (I.R.S. Employer
of incorporation) Identification Number)
ONE PATRIOTS PARK
BEDFORD, MASSACHUSETTS 01730-2396
----------------------------------------
(Address of principal executive offices)
781-275-6000
-------------------------------
(Registrant's telephone number)
================================================================================
EXPLANATORY NOTE
This Amendment No. 1 to Current Report on Form 8-K is being filed to amend
and restate the disclosure provided in Item 4 of this Form 8-K dated December
31, 2003.
ITEM 4. CHANGES IN REGISTRANT'S CERTIFYING ACCOUNTANT.
On December 31, 2003, Spire Corporation (the "Company") dismissed KPMG LLP
("KPMG") as its principal independent accountant. However, KPMG will complete
the audit of the balance sheets of Bandwidth Semiconductors, LLC (acquired by
the Company on May 23, 2003) as of December 31, 2002 and 2001, and the related
statements of operations, stockholders' equity, and cash flows for the years
ended December 31, 2002 and 2001, all of which are to be included in a Current
Report on Form 8-K/A. The decision to change principal independent accountants
was approved by the Company's Audit Committee. On January 7, 2004, the Company
engaged Vitale, Caturano & Company, P.C. ("VCC") as its new principal
independent accountant. The engagement of VCC was approved by the Company's
Audit Committee. For further information regarding the engagement of VCC as the
Company's new principal independent accountant, see the Company's Current Report
on Form 8-K, dated January 7, 2004, filed with the Securities and Exchange
Commission on January 8, 2004.
KPMG's report on the financial statements of the Company for each of the
years ended December 31, 2001 and 2002 did not contain an adverse opinion or a
disclaimer of opinion and were not modified as to uncertainty, audit scope or
accounting principles.
During the Company's two most recent fiscal years ended December 31, 2002
and the subsequent interim period through December 31, 2003, there were no
disagreements with KPMG on any matter of accounting principles or practices,
financial statement disclosure, or auditing scope or procedure, which
disagreements, if not resolved to KPMG's satisfaction, would have caused KPMG to
make reference to the subject matter of the disagreement(s) in connection with
its reports on the Company's financial statements.
During the Company's two most recent fiscal years ended December 31, 2002
and the subsequent interim period through December 31, 2003, there were no
reportable events (as described in Item 304(a)(1)(iv)(B) of Regulation S-B),
except as follows:
(i) In connection with its audit of the Company's financial statements for
the period ended December 31, 2002, KPMG advised the Audit Committee by a
letter dated April 30, 2003 that it noted certain matters involving
internal control and its operation that it considered to be reportable
conditions under standards established by the American Institute of
Certified Public Accountants (the "AICPA"). Reportable conditions are
matters coming to an independent auditors' attention that, in their
judgment, relate to significant deficiencies in the design or operation of
internal control and could adversely affect the organization's ability to
record, process, summarize, and report financial data consistent with the
assertions of management in the financial statements. KPMG advised the
Audit Committee that it considered the following to constitute a reportable
condition: During 2002, the Company did not follow its accounting policy on
revenue recognition for its business to install solar electric systems (its
solar systems division). KPMG advised the Audit Committee that (a) it did
not believe that this condition constituted a material weakness and (b)
this condition was considered in determining the nature, timing and extent
of the audit tests applied in its audit of the Company's 2002 financial
statements, and that the condition did not affect KPMG's report dated March
20, 2003 with respect to these financial statements. The Audit Committee
discussed the subject matter of this reportable event with KPMG.
2
The Company believes that this reportable condition did not exist
prior or subsequent to fiscal year 2002. Furthermore, the Company concluded
that this reportable condition did not have a material effect on the
Company's quarterly financial statements for 2002.
(ii) In connection with its review of the Company's Form 10-QSB for the
quarter ended June 30, 2003, KPMG advised the Audit Committee and
management by a letter dated December 24, 2003 that it noted certain
matters involving internal control and its operation that it considered to
be material weaknesses that constituted reportable conditions under
standards established by the AICPA. Under those standards, a material
weakness is a reportable condition in which the design or operation of one
or more internal control components does not reduce to a relatively low
level the risk that errors or fraud in amounts that would be material in
relation to the financial statements being audited may occur and not be
detected within a timely period by employees in the normal course of
performing their assigned functions. KPMG advised management and the Audit
Committee that it considered the following to constitute material
weaknesses in internal control and operations: the Company's failure to
adequately staff its finance group with the appropriate level of experience
to effectively control the increased level of transaction activity, address
the complex accounting matters and manage the increased financial reporting
complexities resulting from, among other things, the acquisition of
Bandwidth on May 23, 2003 and the implementation of a new financial
reporting system during the second quarter of 2003. The Audit Committee
discussed the subject matter of this reportable event with KPMG.
The Company is currently assessing the findings of KPMG set forth in its
letter dated December 24, 2003. However, the Company has made and is continuing
to make changes in its controls and procedures, including its internal control
over financial reporting, aimed at enhancing their effectiveness and ensuring
that the Company's systems evolve with, and meet the needs of, the Company's
business. The Company is also continually striving to improve its management and
operational efficiency and the Company expects that its efforts in that regard
will from time to time directly or indirectly affect the Company's controls and
procedures, including its internal control over financial reporting. For
example, as a result of the resignation of the Company's former Chief Financial
Officer on November 4, 2003, the Company commenced a search for a new chief
financial officer, and is now in the final stages of hiring a permanent chief
financial officer with the appropriate experience and background to manage the
diverse and complex financial issues which may arise in the Company's business.
The Company is also continuing its efforts to upgrade the information technology
capabilities of certain of the Company's business units, as well as integrate
the financial accounting systems used by certain of its business units.
The Company has authorized KPMG to respond fully to the inquiries of the
successor accountant concerning the subject matter of the reportable conditions
and material weaknesses cited by KPMG.
The Company has provided KPMG with a copy of the disclosures it is making
in this report and has requested KPMG to furnish the Company with a letter
addressed to the Securities and Exchange Commission stating whether it agrees
with the statements made by the Company in this report and, if not, stating the
respects in which it does not agree. A copy of that letter is filed as Exhibit
16.1 to this report.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(c) Exhibits.
Exhibit No. Description
----------- -----------
16.1 Letter from KPMG LLP to the Securities and Exchange
Commission dated March 26, 2004.
3
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.
SPIRE CORPORATION
Date: March 26, 2004 By: /s/ Roger G. Little
----------------------------------
Roger G. Little
President, Chief Executive Officer
and Chairman of the Board
4
EXHIBIT INDEX
Exhibit Description Page Number
------- ----------- -----------
16.1 Letter from KPMG LLP to the Securities and
Exchange Commission dated March 26, 2004. 6
5