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): June 13, 2008
TARRAGON CORPORATION
(Exact Name of Registrant as Specified in Charter)
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Nevada
(State or Other Jurisdiction
of Incorporation)
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0-22999
(Commission
File Number)
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94-2432628
(IRS Employer
Identification No.)
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423 West 55th, 12th Floor
New York, New York 10019
(Address of Principal Executive Offices) (Zip Code)
Registrants telephone number, including area code:
(212) 949-5000
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 (
see
General
Instruction A.2. below):
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Item 4.01. Changes in Registrants Certifying Accountant.
(a) Previous Independent Registered Public Accounting Firm
On June 13, 2008, the Audit Committee of the Board of Directors (the Audit Committee) of Tarragon
Corporation (the Company) dismissed Grant Thornton LLP (Grant Thornton) as the Companys
independent registered public accounting firm. The Company advised Grant Thornton of its dismissal
on June 13, 2008. The reports of Grant Thornton on the Companys consolidated financial statements
for the fiscal years ended December 31, 2007 and 2006 did not contain any adverse opinion or a
disclaimer of opinion, and were not qualified or modified as to uncertainty, audit scope or
accounting principles, except for the following matter.
The report of Grant Thornton on the Companys consolidated financial statements for the fiscal
year ended December 31, 2007 contained an explanatory paragraph concluding that there was
substantial doubt as to the Companys ability to continue as a going concern, as discussed more
fully in Note 1 to the consolidated financial statements included in the Companys Annual
Report on Form 10-K filed with the Securities and Exchange Commission (the Commission) on
March 28, 2008.
During the fiscal years ended December 31, 2007 and 2006, and through June 13, 2008, there were no
disagreements between the Company and Grant Thornton pursuant to Item 304(a)(1)(iv) of
Regulation S-K of the Securities Exchange Act of 1934, as the term disagreement is therein
defined, 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 Grant
Thornton, would have caused it to make reference thereto in its report on the financial statements
for such periods.
During the years ended December 31, 2007 and 2006, and through June 13, 2008, there were no
reportable events requiring disclosure pursuant to Item 304(a)(1)(v) of Regulation S-K of the
Securities Exchange Act of 1934, as the term reportable events is therein defined, other than the
material weaknesses described below.
In connection with the audits for the fiscal years ended December 31, 2007 and 2006, Grant
Thornton identified a material weakness in the Companys internal controls over financial
reporting because the Company did not have sufficient accounting and finance resources with an
appropriate level of accounting experience and training in the application of U.S. generally
accepted accounting principles consistent with the level and complexity of the Companys
operations and financial reporting requirements, as previously disclosed in Items 9A of the
Companys Annual Reports on Form 10-K filed with the Commission on March 28, 2008 and April 2,
2007, respectively. During the preparation of the Companys interim consolidated financial
statements for the period ended March 31, 2008, Grant Thornton advised the Company that
effective controls were not maintained to ensure (i) timely recording of required period-end
adjustments, (ii) accumulation and review of all required supporting information to ensure
completeness and accuracy of the consolidated financial statements and disclosures, and (iii)
timeliness of the financial close and reporting process, and Grant Thornton concluded that
these deficiencies constituted a separate and additional material weakness in the Companys
internal controls. The Audit Committee discussed the foregoing
matters with Grant Thornton. The Company has requested that Grant
Thornton respond fully to any inquiries it may receive from successor
accountants concerning these matters.
Prior to the filing of this Current Report on Form 8-K with the Commission, the Company provided
Grant Thornton with a copy of this Current Report on Form 8-K and requested Grant Thornton to
furnish the Company with a letter addressed to the Commission stating whether Grant Thornton agrees
with the above statements. A copy of that letter, dated June 18, 2008, is filed as Exhibit 16.1 to
this Current Report on
Form 8-K.
(b) New Independent Registered Public Accounting Firm
On June 17, 2008, the Audit Committee engaged Travis, Wolff & Company, LLP (Travis Wolff) as the
Companys new independent registered public accounting firm. Prior to the engagement of Travis
Wolff, including the years ended December 31, 2007 and 2006 and through June 17, 2008, neither the
Company nor anyone acting on its behalf consulted with Travis Wolff regarding (i) either the
application of accounting principles to a specified
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transaction, either completed or proposed, or the type of audit opinion that might be rendered on
the Companys consolidated financial statements, and neither a written report was provided to the
Company or oral advice was provided that Travis Wolff concluded was an important factor considered
by the Company in reaching a decision as to the accounting, auditing or financial reporting issue
or (ii) any matter that was either the subject of a disagreement, as that term is defined in
Item 304(a)(1)(iv) of Regulation S-K and the related instructions to Item 304 of Regulation S-K, or
a reportable event, as that term is defined in Item 304(a)(1)(v) of Regulation S-K.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
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Exhibit No.
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Description
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16.1
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Letter from Grant Thornton LLP dated June 18, 2008.
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