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): September 14, 2016 (September 13, 2016)

 

MISONIX, INC.

 

(Exact name of registrant as specified in its charter)

 

New York   1-10986   11-2148932
(State or other jurisdiction of   (Commission File Number)   (IRS Employer
incorporation)       Identification No.)

 

1938 New Highway, Farmingdale, NY       11735
(Address of principal executive offices)       (Zip Code)

 

Registrant’s telephone number, including area code (631) 694-9555

 

 

 

(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:

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 

 

Item 2.02
Results of Operations and Financial Condition.

 

Item 7.01 Regulation FD Disclosure.

 

On September 14, 2016, MISONIX, INC. (the “Company”) filed a Form 12b-25 (the “Form”) with the Securities and Exchange Commission indicating that the Company likely will not be in a position to file its Annual Report on Form 10-K for the fiscal year ended June 30, 2016 within the 15-day extension period provided in Rule 12b-25(b) promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

 

The Form stated that the Audit Committee of the Company has determined that deficiencies existed in the Company’s internal control over financial reporting at June 30, 2016. The Audit Committee is still considering whether or not the deficiencies constitute one or more material weaknesses in the Company’s internal control over financial reporting at such date. Notwithstanding its determination, the Audit Committee has no current information to suggest that the Company’s previously reported financial statements and results are incorrect in any material respect. The filing of the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2016 will be delayed pending completion of an investigation relating to these deficiencies being overseen by the Audit Committee. The filing may also be delayed as a result of the appointment effective September 13, 2016 by the Board of Directors of the Company of Joseph Dwyer as interim Chief Financial Officer. Richard A. Zaremba, Senior Vice President and Chief Financial Officer through September 13, 2016, has been appointed Senior Vice President, Finance. The Company is working diligently to resolve these matters and intends to file its Annual Report on Form 10-K as promptly as reasonably practicable.

 

Preliminary results for the fiscal year ended June 30, 2016 are net sales of $23.1 million and a net loss ranging from $(1.0) million to $(1.3) million for the fiscal year ended June 30, 2016 as compared to net sales of $22.2 million and net income of $5.6 million for the fiscal year ended June 30, 2015, which included a $2.9 million reversal of the valuation allowance previously recorded against deferred tax assets. On a per share basis, such preliminary results represent a net loss per share – basic ranging from $(0.13) to $(0.17) and a net loss per share – diluted ranging from $(0.13) to $(0.17) for the fiscal year ended June 30, 2016 as compared to net income per share – basic of $0.74 and net income per share – diluted of $0.69. The preliminary net loss for the fiscal year ended June 30, 2016 is attributable to higher operating expenses, including higher sales and marketing expense.

 

The Company issued a press release on September 14, 2016 announcing the filing of the Form and the preliminary results for the fiscal year ended June 30, 2016. The press release is attached hereto as Exhibit 99.1. The information in this Item and the aforementioned press release shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, and is not incorporated by reference into any filing of the Company, whether made before or after the date of this report, regardless of any general incorporation language in the filing.

 

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

 

(b) On September 13, 2016, Richard A. Zaremba (i) ceased serving as the Company’s Senior Vice President and Chief Financial Officer and (ii) was appointed Senior Vice President, Finance of the Company. He remains the Company’s Secretary and Treasurer.

 

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(c) On September 13, 2016, the Board of Directors of the Company appointed Joseph Dwyer, age 60, as the Company’s interim Chief Financial Officer, reporting to the Company’s Chief Executive Officer and Audit Committee. The Company entered into a Consulting Agreement, dated September 13, 2016, with Dwyer Holdings LLC (“Dwyer Co.”) to provide Mr. Dwyer’s services to the Company (the “Agreement”). The Agreement is in effect for a one (1) year period, cancellable by either party upon five (5) days’ notice anytime after the initial two (2) months of the term. Dwyer Co. will be paid $30,000 per month for Mr. Dwyer’s services.

 

From June 2015 to the present, Mr. Dwyer has provided financial consulting and advisory services to companies through Dwyer Co. Prior thereto, from November 2012 until June 2015, he was Chief Financial Officer of Virtual Piggy, Inc., a publicly-traded technology company (“Virtual Piggy”). Prior to joining Virtual Piggy, Mr. Dwyer served as chief financial officer of OpenLink Financial, Inc., a privately held company, which provides software solutions for trading and risk management in the energy, commodity, and capital markets. During 2011 and 2012, Mr. Dwyer was a member of the board of directors and chairman of the audit committee and served as interim chief administrative officer of Energy Solutions International, Inc., a privately held company providing pipeline management software to energy companies and pipeline operators. From 2010 through 2011, Mr. Dwyer served as chief administrative officer of Capstone Advisory Group, LLC, a privately held financial advisory firm providing corporate restructuring, litigation support, forensic accounting, expert testimony and valuation services. Mr. Dwyer served as a consultant to Verint Systems, Inc., a software company listed on the NASDAQ Global Market, from 2009 through 2010, assisting with SEC reporting and compliance. From 2005 through 2009, Mr. Dwyer served as chief financial officer and executive vice president of AXS-One Inc., a publicly traded software company. During 2004, Mr. Dwyer served as chief financial officer of Synergen, Inc., a privately held software company providing energy technology to utilities. Prior to 2004, Mr. Dwyer also served as chief financial officer and executive vice president of Caminus Corporation, an enterprise application software company that was formerly listed on the NASDAQ National Market, chief financial officer of ACTV, Inc., a digital media company that was formerly listed on the NASDAQ National Market, and chief financial officer of Winstar Global Products, Inc., a manufacturer and distributor of hair care, bath and beauty products until its acquisition by Winstar Communications, Inc. in 1995 when Mr. Dwyer went on to serve as senior vice president, finance of Winstar Communications. Mr. Dwyer received his BBA in Accounting from the University of Notre Dame in 1978 and is licensed as a Certified Public Accountant in the State of New York.

 

The foregoing description of the Agreement is qualified in its entirety by reference to the full text of such document which document is Exhibit 10.24 to this Report.

 

Item 9.01 Financial Statements and Exhibits.

 

(d) Exhibits.

 

Exhibit 10.24 Consulting Agreement, dated September 13, 2016, by and between MISONIX, INC. and Dwyer Holdings LLC.

 

Exhibit 99.1 Press Release of MISONIX, INC., dated September 14, 2016.

 

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SIGNATURES

 

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.

 

Date: September 14, 2016 MISONIX, INC.  
         
    By: /s/ Stavros G. Vizirgianakis  
      Stavros G. Vizirgianakis  
      Interim Chief Executive Officer  

 

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EXHIBIT INDEX

 

Exhibit No.   Description
     
Exhibit 10.24   Consulting Agreement, dated September 13, 2016, by and between MISONIX, INC. and Dwyer Holdings LLC
     
Exhibit 99.1   Press Release of MISONIX, INC., dated September 14, 2016

 

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Exhibit 10.24

 

CONSULTING AGREEMENT

 

This CONSULTING AGREEMENT (“ Agreement ”) is made and entered into September 13, 2016 by and between Misonix, Inc., (the “ Company “), and Joseph Dwyer, doing business as Dwyer Holdings LLC, residing at 3 Cordwood Court, East Northport, NY 11731 (“ Consultant ”).

 

In consideration of the mutual premises herein contained and intending to be legally bound hereby, the parties agree as follows:

 

1.           Consulting Services .

 

1.1.           Services . During the term of this Agreement, Consultant shall provide consulting services to the Company as set forth in Schedule 1 hereto (the “ Consulting Services ”). The Consultant will perform the Consulting Services faithfully, diligently and to the best of the Consultant’s skill and ability.

 

1.2            Consulting Term . The term of this Agreement shall begin on the date hereof and shall continue for one year (the “ Term ”), unless terminated prior thereto pursuant to Section 3 below. This agreement will then automatically renew for successive one month periods (each a “ Renewal Term ”). Any Renewal Term may be terminated anytime pursuant to Section 3 below.

 

1.3           Independent Contractor . Consultant and Company acknowledge and agree that the relationship hereunder created is one of an independent contractor and not one of employment. Consultant shall at all times during the Consulting Term act as an independent contractor and nothing hereunder shall be construed to be inconsistent with this relationship or status or create or imply a relationship of employer-employee between the Company and Consultant. Consultant shall not hold himself out to third parties as an employee of Company, and shall have no authority to bind or commit Company, legally or otherwise. The Consultant shall not be entitled to any benefits paid by the Company to its employees. The Consultant shall be solely responsible for any tax consequences applicable to him by reason of this Agreement and the relationship established hereunder, and the Company shall not be responsible for the payment of any federal, state or local taxes or contributions imposed under any employment insurance, social security, income tax or other tax law or regulation with respect to the Consultant’s performance of consulting services hereunder. Company and Consultant shall report any and all payments made by Company pursuant to this Agreement to the appropriate governmental agencies in a manner consistent with Consultant's status as an independent contractor.

 

2.            Compensation; Expenses . The Company shall pay Consultant the Payment as set forth in Schedule 1 hereto. The Company will also reimburse Consultant for all reasonable travel or other expenses related to the fulfillment of services hereunder, in accordance with the Company’s business travel and expense policy.

 

3.            Termination .

 

3.1.          Either party may terminate this Agreement by written notice to the other at any time upon 5 days written notice. Notwithstanding, the Company shall be obligated to compensate Consultant for the first two months of this Agreement at the rate identified in Schedule 1. In the event of termination pursuant to this Section 3.1, the Company shall not be responsible to make any further payment of any kind to Consultant except for payment of fees earned prior to the date of termination. Fees earned on a fixed fee basis shall be calculated on a pro-rata basis.

 

Misonix Consulting Agreement Page 1

 

 

3.2           This Agreement shall terminate automatically in the event of Consultant's death.

 

4.           Confidentiality . Consultant understands that Consultant's work as a consultant of the Company creates a relationship of trust and confidence between Consultant and the Company. During and after the Term of this Agreement, Consultant will not use or disclose or allow anyone else to use or disclose any " Confidential Information " (as defined below) relating to the Company, its subsidiaries, its products, services, suppliers or customers except (i) as may be necessary in the performance of Consultant's work for the Company which use or disclosure shall be solely for the benefit of the Company in connection with the Company’s business and in accordance with the Company’s business practices and employee policies or (ii) as may be specifically authorized in advance by appropriate officers of the Company. " Confidential Information " shall include, but shall not be limited to, information consisting of research and development, patents, trademarks and copyrights and applications thereto, technical information, computer programs, software, methodologies, innovations, software tools, know-how, knowledge, designs, drawings, specifications, concepts, data, reports, processes, techniques, documentation, pricing, marketing plans, customer and prospect lists, trade secrets, financial information, salaries, business affairs, suppliers, profits, markets, sales strategies, forecasts, employee information and any other information not available to the general public, whether written or oral, which Consultant knows or has reason to know the Company or its subsidiaries would like to treat as confidential for any purpose, such as maintaining a competitive advantage or avoiding undesirable publicity. Consultant will keep Confidential Information secret and will not allow any unauthorized use of the same, whether or not any document containing it is marked as confidential. These restrictions, however, will not apply to Confidential Information that has become known to the public generally through no fault or breach of Consultant's or that the Company regularly gives to third parties without restriction on use or disclosure. Consultant further understands and acknowledges that (a) the Confidential Information is the property of the Company, constitutes a major asset of the Company and is crucial to the successful operation of the Company's business; (b) the use, misappropriation or disclosure of the Confidential Information would constitute a breach of trust and could cause irreparable injury to the Company; and (c) it is essential to the protection of the Company's goodwill and to the maintenance of the Company's competitive position that the Confidential Information be kept secret.

 

5.           Return of Company Property . Promptly upon the expiration or sooner termination of the term of this Agreement, and earlier if requested by the Company at any time, Consultant shall deliver to the Company (and will not keep in Consultant’s possession or deliver to anyone else) all Confidential Information and all devices, records, data, notes, reports, proposals, lists, correspondence, specifications, materials, equipment, other documents or property, or reproductions of any aforementioned items developed by Consultant as part of or in connection with the Consulting Services or otherwise belonging to the Company.

 

Misonix Consulting Agreement Page 2

 

 

6           Indemnification. To the fullest extent permitted by law, the Company shall indemnify, defend and hold harmless Consultant from and against all claims and expenses, including attorneys’ fees, arising out of or related to the services provided under this agreement. The Company agrees to provide directors and officers liability insurance, effecting with the execution of this Agreement, in the same form and amounts as available to other directors and officers of the Company.

 

7.           Representations, Warranties and Covenants . The Consultant hereby represents, warrants and covenants to the Company as follows:

 

7.1.          Neither the execution and delivery of this Agreement, the performance of the transactions contemplated hereby, nor compliance by the Consultant with any of the provisions hereof will: (a) violate any order, writ, injunction, decree, law, statue, rule or regulation applicable in any respect to the Consultant or with respect to any of his obligations hereunder; or (b) require the consent, approval, permission or other authorization of, or qualification or filing with or notice to, any court, arbitrator or other tribunal or any governmental, administrative, regulatory or self-regulatory agency or any other third party, except for those that have been obtained;

 

7.2           Consultant: (a) is not and will not become a party to, and is not and will not become subject to, any employment agreement, non-competition agreement or covenant, non-disclosure agreement or covenant or any other agreement, covenant, understanding or restriction that would prohibit the Consultant from executing this Agreement, engaging in the transactions contemplated hereby or performing fully his duties and responsibilities hereunder; and (b) can perform his obligations hereunder without disclosing or using any confidential or proprietary information of any third party; and

 

7.3           To Consultant’s knowledge, this Agreement and the transactions contemplated hereby will not infringe or conflict with, and are not inconsistent with, the rights of any other person.

 

8.           Governing Law . This Agreement shall be governed by and all questions relating to its validity, interpretation, enforcement and performance (including, without limitation, provisions concerning limitations of actions) shall be construed in accordance with the laws of the State of New York without regard to its choice of law statutes and/or case law.

 

9.           Notices . All notices and other communications hereunder or in connection herewith shall be in writing and shall be deemed to have been given when delivered by hand, reputable express delivery service, mailed by certified or registered mail, return receipt requested, or sent via facsimile and followed up by hand delivery, reputable express delivery service or mailed by certified or registered mail, return receipt requested to the party as follows (provided that notice of change of address shall be deemed given only when received):If to the Company, to:

 

Misonix, Inc.

Attention: Thomas Patton

1938 New Highway

Farmingdale, NY 11577

 

Misonix Consulting Agreement Page 3

 

 

If to Consultant, to:

 

Joseph Dwyer, dba Dwyer Holdings, LLC

3 Cordwood Court

East Northport, NY 11731

Attention: Joseph Dwyer

 

or to such other names or addresses as Company or Consultant, as the case may be, shall designate by notice to the other person in the manner specified in this Section.

 

10.          Miscellaneous . This Agreement: (a) constitutes the entire agreement and supersedes any prior and contemporaneously-made written or oral agreements between the parties relating to the subject matter hereof; (b) except as specifically provided herein, may be modified only in a writing duly executed by the parties hereto; (c) shall be binding upon and inure to the benefit of and be enforceable by the successors and permitted assigns of the Company; and (d) shall not be assignable or delegable in whole or in part by Consultant without the prior written consent of the Company.

 

11.          Severability . The covenants in this Agreement are severable, and if any covenant or portion thereof is held to be invalid or unenforceable for any reason, such covenant or portion thereof shall be modified or adjusted by a court or other tribunal exercising its equitable powers to the extent necessary to cure such invalidity or unenforceability, and all other covenants and provisions shall remain valid and enforceable.

 

12.          Counterparts . This Agreement may be executed in counterparts, each of which shall be deemed an original, and both of which together shall constitute one and the same instrument. The Agreement may further be delivered by facsimile or electronic transmission, and the facsimile or electronic signatures may be deemed original signatures for all purposes, including for purposes of the Best Evidence Rule and all other rules or doctrines of similar effect.

 

13.          Survival . Notwithstanding any termination or expiration of this Agreement, Sections 4, 5, 6, 7 and 8 of this Agreement shall survive and remain in full force and effect in accordance with their respective terms.

 

IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date first above written.

 

MISONIX, INC.

 

Signature: /s/ Stavros G. Vizirgianakis  
     
Name: Stavros G. Vizirgianakis  
     
Title:

Interim Chief Executive Officer

 
     
Date: September 13, 2016  

 

Misonix Consulting Agreement Page 4

 

 

CONSULTANT

 

Signature: /s/ Joseph Dwyer  

 

Name: Joseph Dwyer

 

Date: September 13, 2016

 

Misonix Consulting Agreement Page 5

 

 

SCHEDULE 1

 

Services: Consultant is retained to provide the following services (“Services”) to Company:

 

Consultant shall be appointed as interim Chief Financial Officer, reporting to the audit committee of the board of directors of the Company and to the Company’s Chief Executive Officer. Consultant shall perform CFO related services for the Company at its direction.

 

Payment : Company shall issue to Consultant Payment in the amount of $30,000 per month, payable at the end of each month during the term of this Agreement. Company shall pay Consultant a retainer of $15,000 at the commencement of Services, which will be credited to the Company on the final invoice.

 

Misonix Consulting Agreement Page 6

 

 

 

Misonix Files for Extension of Time for Annual Report on Form 10-K; Appoints Interim CFO

 

For Immediate Release

 

Corporate Contact Investor Contact
Misonix Contact: Joe Diaz
Richard Zaremba Lytham Partners
631-694-9555 602-889-9700
invest@misonix.com info@misonix.com

 

 

FARMINGDALE, NY – September 14, 2016 -- Misonix, Inc. (NASDAQ: MSON) , an international surgical device company that designs, manufactures and markets innovative therapeutic ultrasonic products for spine surgery, neurosurgery, wound debridement, skull based surgery, laparoscopic surgery and other surgical applications, announced that it filed a Form 12b-25 (the “Filing”) today with the Securities and Exchange Commission indicating that Misonix likely will not be in a position to file its Annual Report on Form 10-K for the fiscal year ended June 30, 2016 within the 15-day extension period provided in Rule 12b-25(b) under the Securities Exchange Act of 1934.

 

The Filing stated that the Audit Committee of the Company has determined that deficiencies existed in the Company’s internal control over financial reporting at June 30, 2016. The Audit Committee is still considering whether or not the deficiencies constitute one or more material weaknesses in the Company’s internal control over financial reporting at such date. Notwithstanding its determination, the Audit Committee has no current information to suggest that the Company’s previously reported financial statements and results are incorrect in any material respect. The filing of the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2016 will be delayed pending completion of an investigation relating to these deficiencies being overseen by the Audit Committee. The filing may also be delayed as a result of the appointment effective September 13, 2016 by the Board of Directors of the Company of Joseph Dwyer as interim Chief Financial Officer. Richard A. Zaremba, Senior Vice President and Chief Financial Officer through September 13, 2016, has been appointed Senior Vice President, Finance. The Company is working diligently to resolve these matters and intends to file its Annual Report on Form 10-K as promptly as reasonably practicable.

    

Preliminary results for the fiscal year ended June 30, 2016 are net sales of $23.1 million and a net loss ranging from $(1.0) million to $(1.3) million for the fiscal year ended June 30, 2016 as compared to net sales of $22.2 million and net income of $5.6 million for the fiscal year ended June 30, 2015, which included a $2.9 million reversal of the valuation allowance previously recorded against deferred tax assets. On a per share basis, such preliminary results represent a net loss per share – basic ranging from $(0.13) to $(0.17) and a net loss per share – diluted ranging from $(0.13) to $(0.17) for the fiscal year ended June 30, 2016 as compared to net income per share – basic of $0.74 and net income per share – diluted of $0.69. The preliminary net loss for the fiscal year ended June 30, 2016 is attributable to higher operating expenses, including higher sales and marketing expense.

 

 

 

  

 

About Misonix

Misonix, Inc. designs, develops, manufactures and markets therapeutic ultrasonic medical devices. Misonix's therapeutic ultrasonic platform is the basis for several innovative medical technologies. Addressing a combined market estimated to be in excess of $1.5 billion annually; Misonix's proprietary ultrasonic medical devices are used in spine surgery, neurosurgery, orthopedic surgery, wound debridement, cosmetic surgery, laparoscopic surgery, and other surgical and medical applications. Additional information is available on the Company's Web site at www.misonix.com .

 

Safe Harbor Statement

With the exception of historical information contained in this press release, content herein may contain "forward looking statements" that are made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and are subject to uncertainty and changes in circumstances. Investors are cautioned that forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from the statements made. These factors include general economic conditions, delays and risks associated with the performance of contracts, risks associated with international sales and currency fluctuations, uncertainties as a result of research and development, acceptable results from clinical studies, including publication of results and patient/procedure data with varying levels of statistical relevancy, risks involved in introducing and marketing new products, potential acquisitions, consumer and industry acceptance, litigation and/or court proceedings, including the timing and monetary requirements of such activities, the timing of finding strategic partners and implementing such relationships, regulatory risks including approval of pending and/or contemplated 510(k) filings, the ability to achieve and maintain profitability in the Company's business lines, the completion of the investigation related to identified deficiencies in internal control over financial reporting, and other factors discussed in the Company's Annual Report on Form 10-K, subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. The Company disclaims any obligation to update its forward-looking relationships.

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