UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): November 5, 2002
Commission File Number 0-30745
INTERCALLNET, INC.
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(Exact name of registrant as specified in its charter)
Florida 88-0426807
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(State or other jurisdiction (I.R.S. Employer
of incorporation or organization Identification No.)
6340 NW 5th Way
Fort Lauderdale, FL 33309
(Address of principal executive offices) (Zip Code)
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Registrant's telephone number, including area code (954) 315-3100
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Former name or former address, if changed since last report
ITEM 1. CHANGES IN CONTROL OF REGISTRANT
Not Applicable.
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
Not Applicable.
ITEM 3. BANKRUPTCY OR RECEIVERSHIP
Not Applicable.
ITEM 4. CHANGES IN REGISTRANT'S CERTIFYING ACCOUNTANT
On November 5, 2002, Intercallnet, Inc. (the "Registrant") received
correspondence from its certifying accountant for the fiscal years ended June
30, 2002 and June 30, 2001, Ahearn Jasco + Company, P.A. ("Ahearn") stating that
such firm is resigning as the auditors and accountants for the Registrant,
effective immediately, and that such firm is taking this action as it cannot
rely on the representations of the Board of Directors and management.
In its correspondence to the Registrant, Ahearn advised that based on
the lack of progress by the Registrant to investigate and correct the material
accounting errors described in the Registrant's Form 8-K dated September 3, 2002
(see below), it is withdrawing its audit opinions and interim review reports for
all prior periods, and that the Registrant should notify all users of the
Registrant's financial statements of this action.
The Registrant had previously received correspondence on October 11,
2002 dated October 10, 2002 from Ahearn stating that based on documentation
received by Ahearn from the Registrant's then Chief Financial Officer, Ahearn
had preliminarily concluded that two of the present directors of the Registrant
(one of which is the Chief Executive Officer) were involved in a series of
transactions during calendar year 2000 that resulted in materially incorrect
financial statements being filed with the SEC, and that such documentation
indicates that it is reasonably possible that these transactions are illegal
acts, or are covering up illegal acts. Such correspondence further states that
the Registrant's management acted and filed a Form 8-K with the SEC to recall
the affected documents, began efforts to investigate the transactions and to
take appropriate remedial actions, and that the implicated directors have not
provided any meaningful assistance which was promised. Such correspondence
concludes that it is intended to be a notice pursuant to Section 10A of the
Securities Exchange Act of 1934 ("Exchange Act").
Upon receipt of Ahearn's October 10, 2002 correspondence, Paul Cifaldi,
a director of the Registrant, directed correspondence for and on behalf of the
Registrant's Board of Directors dated October 10, 2002 to Ahearn reconfirming
Ahearn's prior agreement that it was not necessary for assistance to be provided
to Ahearn in the investigation of the transactions in question until possibly
after the Registrant's completion of its ongoing negotiations with Stanford
Venture Capital Holdings, Inc.("Stanford")concerning a possible corporate
restructuring. Such negotiations, which include a possible assignment for the
benefit of creditors, are continuing. Such correspondence from Mr. Cifaldi
further stated that pending the conclusion of such Stanford negotiations, the
Board of Directors strongly urged Ahearn not to draw any conclusions or
characterizations based on the documentation alone, and that when the
negotiations with Stanford were completed, the Board of Directors would assist
Ahearn in an investigation and facilitate discussions with certain other third
parties. Ahearn did not respond to such correspondence until the Registrant's
receipt of Ahearn's resignation letter.
The Registrant does not believe that Ahearn's October 10, 2002
correspondence constituted a Section 10A notice under the Exchange Act as it did
not involve any discovery in the course of an audit, as is expressly required by
Section 10A and the provisions thereunder. Accordingly, the Registrant does not
believe that it had any obligation to provide any notice to the SEC under such
statutory provisions.
The Registrant disagrees with Ahearn concerning its statements in its
November 5, 2002 correspondence concerning the lack of progress to investigate
and correct the matters described above, in view of the prior October 10, 2002
correspondence sent to Ahearn discussed above.
Except as described above, during the period of Ahearn's engagement,
there were no disagreements between the Registrant and Ahearn on any matter of
accounting principles or practices, financial statement disclosure, or auditing
scope or procedure, which disagreements, if not resolved to the satisfaction of
Ahearn, would have caused Ahearn to make reference thereto in connection with
their report to the subject matter of the disagreements. The accountants' report
on the financial statements of the Registrant for the fiscal year ended June 30,
2001 contained within the Registrant's Form 10-KSB for the fiscal year ended
June 30, 2001 did not contain any adverse opinion or disclaimer of opinion and
was not qualified or modified as to uncertainty or audit scope or accounting
principles (a going concern qualification was discussed in Note 1 to the
Registrant's Consolidated Financial Statements for the year ended June 30, 2001
and for the period July 30, 1999 (date of incorporation) through June 30, 2001
included as part of the Registrant's Form 10-KSB for the fiscal year ended June
30, 2001). A Form 10-KSB for the fiscal year ended June 30, 2002 has not yet
been filed by the Registrant.
As previously stated in a Form 8-K filed on September 9, 2002, the
Registrant had determined at that time that it would restate its financial
results to correct certain material accounting errors. The errors involved the
overstatement of property and equipment and intangible assets. After the
Registrant's Chief Financial Officer initially discovered certain errors, the
Registrant began an internal review of all of its accounting for property and
equipment and intangible assets. Based on the internal review, the Registrant's
Chief Financial Officer uncovered certain payments and disbursements during the
time period of May 2000 through October 2000, which were improperly recorded as
property and equipment and intangible assets. This time period during the
calendar year 2000 was prior to the Registrant becoming an SEC registrant. As a
result of these findings, the Registrant notified its auditing firm, its
majority shareholder, and sought legal counsel. On September 3, 2002, the
Registrant's Chief Financial Officer met with the Registrant's auditing firm to
review the documentation resulting from the internal review, and the auditors
concurred with the Registrant's decision to restate all affected financial
statements. Due to severe liquidity restraints, the Registrant currently
believes it will not be able to undertake a restatement of all
affected financial statements or the preparation and filing of a Form 10-KSB for
the fiscal year ended June 30, 2002 or any additional Forms 10-QSB.
A copy of this Form 8-K has been provided to Ahearn prior to the filing
thereof requesting Ahearn to furnish the Registrant with a letter addressed to
the Securities and Exchange Commission stating whether it agrees or disagrees
with the statements made by the Registrant in this Form 8-K, and to provide such
letter as promptly as possible in order that the Registrant can file the letter
with the SEC within ten (10) business days after the filing of this Form 8-K.
This Form 8-K contains certain "forward-looking" statements within the
meaning 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. Actual results may vary materially
from the expectations contained in the forward-looking statements. The
forward-looking statements in this Form 8-K include, without limitation,
statements addressing projected changes in financial results.
ITEM 5. OTHER EVENTS AND REGULATION FD DISCLOSURE
On October 9, 2002, George Pacinelli, the Registrant's President and a
Director resigned from all officer and director positions. On October 9, 2002,
Stephanie Brady, the Registrant's Chief Financial Officer, resigned from such
position.
ITEM 6. RESIGNATIONS OF REGISTRANT'S DIRECTORS.
Not Applicable.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(a) Not Applicable.
(b) Not Applicable.
(c) Exhibits
Not Applicable.
ITEM 8. CHANGE IN FISCAL YEAR
Not Applicable
ITEM 9. REGULATION FD DISCLOSURE
Not Applicable
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.
INTERCALLNET, INC.
November 12, 2002 By: /s/ Scott Gershon
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Scott Gershon, Chief Executive Officer