Full Press Release Details
Helius Medical Technologies Restates and
Historical Financial Statements for Non-Cash Reclassification
NEWTOWN, PA April 26, 2016 Helius Medical Technologies,
Inc. (TSX: HSM and OTCQB: HSDT) ("Helius" or the "Company") The Company is
issuing the following press release to clarify its disclosure.
Restated Financial Statements
The Company has restated its interim financial statements for
the periods ended June 30, 2015, September 30, 2015, and December 31, 2015
(collectively, the Restated Financial Statements ) in order to reflect the
correction of an error in the classification of warrants issued in private
placements closed in April, June, and July 2015 (collectively, the 2015
Warrants ). The Company is filing amended versions of its Quarterly Reports on
Form 10-Q/A for the interim periods ended June 30, 2015 and September 30, 2015,
originally filed on August 14, 2015 and November 16, 2015, respectively, and
subsequently amended on January 11, 2016, as well as an amended version of its
Quarterly Reports on Form 10-Q for the interim period ended December 31, 2015,
originally filed on February 16, 2016, with the Restated Financial Statements
and corresponding changes to the management s discussion and analysis for the
above-noted periods and other portion of such filings. The reclassification is
necessary because the exercise prices of the 2015 Warrants are denominated in
U.S. dollars, while the Company s functional currency is the Canadian dollar.
The requisite non-cash adjustments will not affect the Company s balance sheet
or liquidity. The reclassification of the 2015 Warrants has resulted in a
reduction of the comprehensive loss for the period ending June 30, 2015, an
increase in the diluted gain per share for the period ending September 30, 2015,
and had no impact on the loss per share for the period ending December 31,
Previously, the Company had classified the 2015 Warrants as
equity instruments. Under the provisions of ASC 815-40-15, if the exercise price
of an instrument is denominated in a currency other than the Company s
functional currency, the instrument shall not be considered as indexed to the
Company s own stock because it is exposed to fluctuations in foreign currency
exchange rates. Instead, the instrument should be recorded as a liability at
fair value with subsequent changes in fair value recognized through profit or loss. The exercise prices of the 2015 Warrants are
denominated in U.S. dollars but the functional currency of the Company is the
Canadian dollar. Accordingly, the 2015 Warrants must be classified as
liabilities at fair value with subsequent changes in fair value recognized through profit or loss. As a result, the Company is
required to reclassify the fair value of the 2015 Warrants from equity to
liability with subsequent changes in fair value recognized through profit or loss. The non-cash adjustments to be made as a
result of these reclassifications and subsequent changes in fair value will not affect the Company s cash balance or
its liquidity. Management does not believe that these adjustments will have a
material impact on the Company s future prospects, its business or operating
results or its financial condition.
As a result of the restatements, adjustments made to the
Company s financial statements for the interim period ended June 30, 2015 are
shown in Exhibit 1, adjustments made to the Company s financial statements for
the interim period ended September 30, 2015 are shown in Exhibit 2, and adjustments made to the Company s financial statements for the
interim period ended December 31, 2015 are shown in Exhibit 3.
Prior Restatement of Financial Statements
For an unrelated issue, the Company previously restated its
financial statements for the year ended March 31, 2015 and the periods ending
June 30, 2015 and September 30, 2015 in filings with the Securities and Exchange
Commission filed on January 11, 2016. For more information about the Company s
prior restatement, refer to the Company s press release dated January 11, 2016
and the exhibits attached thereto, as filed with the Company s Current Report on
Form 8-K filed with the Securities and Exchange Commission on January 11,
About Helius Medical Technologies, Inc.
Helius Medical Technologies is a medical technology company
focused on neurological wellness. Helius seeks to develop, license and acquire
unique and non-invasive platform technologies that amplify the brain s ability
to heal itself. Helius intends to file for FDA clearance for the PoNS device.
For more information, please visit www.heliusmedical.com.
The Canadian Securities Exchange has not reviewed and does not
accept responsibility for the adequacy or accuracy of the content of this news
Cautionary Disclaimer Statement:
in this news release are not based on historical facts and constitute
forward-looking statements or forward-looking information within the meaning of
the U.S. Private Securities Litigation Reform Act of 1995 and Canadian
securities laws ( forward-looking statements ).
All statements other than statements of historical fact
included in this news release are forward-looking statements that involve risks
Forward-looking statements are often identified by terms such
as will , may , should , anticipate , expects and similar expressions.
These forward-looking statements are based on Helius Medical Technology, Inc. s
current beliefs, assumptions and expectations regarding future events, which in
turn are based on information currently available to the Company. Such
forward-looking statements include statements regarding materiality or
significance, the quantitative effects of the consolidated restated financial
statements, and any anticipated conclusions of the Board of Directors or the
Company s management with respect to the matters relating to the Company s
accounting, including the restatement of the interim consolidated financial
statements as of and for the quarterly periods ended June 30, 2015, September
30, 2015, and December 31, 2015.
There can be no assurance that such statements will prove to be
accurate and actual results and future events could differ materially from those
anticipated in such statements. Important factors that could cause actual
results to differ materially from the Company s expectations include the failure
of the Company to achieve its business objectives and other risks detailed from
time to time in the filings made by the Company with securities regulators.
The reader is cautioned that assumptions used in the
preparation of any forward-looking statements may prove to be incorrect. Events
or circumstances may cause actual results to differ materially from those
predicted, as a result of numerous known and unknown risks, uncertainties, and
other factors, many of which are beyond the control of the Company. These
factors include, without limitation, the risk that other subsequent events may
occur that would require the Company to make additional adjustments to its
consolidated financial statements. The reader is cautioned not to place undue
reliance on any forward-looking statement. Such information, although considered
reasonable by management at the time of preparation, may prove to be incorrect
and actual results may differ materially from those anticipated. Forward-looking
statements contained in this news release are expressly qualified by this