UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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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) August 14, 2005
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ENZON PHARMACEUTICALS, INC.
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(Exact name of registrant as specified in its charter)
Delaware 0-12957 22-2372868
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(State or other jurisdiction (Commission (IRS Identification No.)
of incorporation) File No.)
685 Route 202/206, Bridgewater, New Jersey 08807
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (908) 541-8600
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(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 communication 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 communication pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b)
[ ] Pre-commencement communication 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
On August 16, 2005, Enzon Pharmaceuticals, Inc. ("Enzon" or the "Company")
issued a press release announcing that it has postponed its earnings release to
report its financial results for the quarter ended June 30, 2005, the fourth
quarter of Enzon's fiscal year 2005, and conference call, which was scheduled to
take place on Wednesday August 17, 2005. A copy of the press release is attached
as Exhibit 99.1 to this Current Report and is incorporated herein by reference.
The reason for the postponement is that Enzon is in the process of preparing a
restatement of its consolidated financial statements and other financial
information for the quarter and fiscal year to date periods ended December 31,
2003, March 31, 2004, June 30, 2004, September 30, 2004, December 31, 2004 and
March 31, 2005. The Company intends to file an amended annual report on Form
10-K/A and amended quarterly reports on Form 10-Q/A with the U.S. Securities and
Exchange Commission ("SEC") as soon as practicable. Item 4.02 contains
additional information about revisions to our financial results, and is
incorporated herein by reference.
Item 4.02(a) Non-Reliance on Previously Issued Financial Statements or a Related
Audit Report or Completed Interim Review.
Restatement and Non-Reliance
On August 14, 2005, the Board of Directors and management of Enzon concluded
that we would need to amend and restate our previously issued financial
statements and other financial information for the quarter and fiscal year to
date periods ended December 31, 2003, March 31, 2004, June 30, 2004, September
30, 2004, December 31, 2004 and March 31, 2005, with respect to our accounting
for a derivative hedging instrument. In light of the restatements, the
previously issued financial statements and other financial information contained
in our Form 10-Qs for such quarters and our Form 10-K/A for the fiscal year
ended June 30, 2004 should no longer be relied upon.
While our continuing review is not yet complete, it has progressed sufficiently
to allow us now to announce that we expect to restate our financial statements
for the above periods. The restatements reported in this Form 8-K have no effect
on our past, current or future revenues, operating income (loss), cash position
or cash flows. For the fiscal year ended June 30, 2004, we currently believe
that the aggregate impact of the expected restated items is a decrease of other
comprehensive income, which is included in the consolidated statement of
stockholders' equity, and a corresponding increase to other non-operating
income, which is included in the consolidated statement of operations. For the
nine months ended March 31, 2005, we currently believe that the aggregate impact
of the expected restated items is an increase of other comprehensive income and
a corresponding decrease in other non-operating income. For each of the periods
being restated the adjustment to other comprehensive income is equal to the
adjustment to other non-operating income, therefore, our total stockholders'
equity will not change as a result of these restatements, exclusive of the
impact of deferred taxes, which we are still evaluating.
Background
During the course of the audit of our financial statements for the year ended
June 30, 2005, we reevaluated our use of hedge accounting for a Zero Cost
Protective Collar arrangement under Statement of Financial Accounting Standards
No. 133, Accounting for Derivative Instruments and Hedging Activities, as
amended (SFAS 133). We have now determined that certain amounts classified as
other comprehensive income and included in our consolidated statement of
stockholders' equity should have been included as other non-operating income and
included in our consolidated statement of operations.
This arrangement was entered into in August 2003 with a financial institution to
reduce our exposure associated with 1.5 million shares of NPS Pharmaceuticals,
Inc. common stock, which we received as part of a merger termination agreement
with NPS. We concluded, after consultation with KPMG LLP, our independent
registered public accounting firm, that as a result of a sale of NPS stock in
October 2003 at a price per share that exceeded the upper limits of the collar,
the hedge was no longer "effective" under SFAS 133, and hedge accounting was no
longer applicable. However, we continued to apply hedge accounting and as such
certain gains and losses on our derivative hedging instrument were recorded as
other comprehensive income (loss) (consolidated statement of stockholders'
equity) as opposed to being recorded as other income (consolidated statement of
operations) once the hedge was no longer "effective". These misallocations
between other income (loss) and other comprehensive income did not have any
impact on total stockholders' equity. On August 22, 2005, this financial
instrument will expire, which will result in the sale of our remaining shares of
NPS and the receipt of cash proceeds of at least $7.5 million.
The Audit Committee of the Board has discussed the restatements discussed in
this Form 8-K with KPMG.
Currently, we intend to file our annual report on Form 10-K for the fiscal year
ended June 30, 2005 on or before the due date of September 13, 2005. However, in
light of the continuing effort in finalizing and filing the amended financial
statements discussed above, we may be unable to do so.
Item 9.01 Financial Statements and Exhibits.
(c) Exhibits.
Exhibit No. Description
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99.1 Press Release of Enzon Pharmaceuticals, Inc. dated August 16,
2005.
SIGNATURES
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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.
Dated: August 16, 2005
By: /s/ Craig A. Tooman
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Craig A. Tooman
Executive Vice President, Finance and
Chief Financial Officer