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UNITED
STATES
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SEC
FILE NUMBER
001-32171
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SECURITIES
AND EXCHANGE COMMISSION
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CUSIP
NUMBER
68384A
10 0
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Washington,
D.C. 20549
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FORM 12b-25
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NOTIFICATION
OF LATE FILING
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(Check
One):
[
] Form 10-K
[
]
Form 20-F [ ] Form 11-K
[X]
Form 10-Q [ ] Form N-SAR
For
Period Ended: September
30, 2006
[ ]
Transition Report on Form 10-K
[ ]
Transition Report on Form 20-F
[ ]
Transition Report on Form 11-K
[ ]
Transition Report on Form 10-Q
[ ]
Transition Report on Form N-SAR
For
the
Transition Period Ended: ____________________
Nothing
in this form shall be construed to imply that the Commission has verified
any
information contained herein.
If
the
notification relates to a portion of the filing checked above, identify the
Item(s) to which the notification relates:
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PART
I — REGISTRANT INFORMATION
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Opteum
Inc.
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Full
Name of Registrant
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N/A
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Former
Name if Applicable
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3305
Flamingo Drive
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Address
of Principal Executive Office (Street
and Number)
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Vero
Beach, FL 32963
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City,
State and Zip Code
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PART
II — RULES 12b-25(b) AND (c)
If
the
subject report could not be filed without unreasonable effort or expense
and the
registrant seeks relief pursuant to Rule 12b-25(b), the following should be
completed. (Check box if appropriate)
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(a) The
reasons described in reasonable detail in Part III of this form could
not be eliminated without unreasonable effort or expense;
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(b) The
subject annual report, semi-annual report, transition report on
Form 10-K, Form 20-F, Form 11-K, Form N-SAR or Form N-CSR,
or portion thereof, will be filed on or before the fifteenth calendar
day
following the prescribed due date; or the subject quarterly report
or
transition report on Form 10-Q or subject distribution report on Form
10-D, or portion thereof, will be filed on or before the fifth
calendar
day following the prescribed due date; and
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(c) The
accountant's statement or other exhibit required by Rule 12b-25(c)
has been attached if applicable.
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PART
III — NARRATIVE
State
below in reasonable detail the reasons why Forms 10-K, 20-F, 11-K, 10-Q,
10-D, N-SAR, N-CSR, or the transition report or portion thereof, could not
be
filed within the prescribed time period.
*
* * *
*
Statements
in this Form 12b-25, including Attachment A hereto, that are not historical
facts may be deemed forward−looking statements within the meaning of the
Securities Exchange Act of 1934, as amended. The reader is cautioned that
such
forward-looking statements are based on information available at the time
and on
the good faith belief of Opteum Inc.’s management with respect to future events,
and are subject to a variety of risks and uncertainties that could cause
actual
outcomes, performance or results to differ materially from those expressed
in
such forward-looking statements. Important factors that could cause such
differences include those factors described in Opteum Inc.'s filings with
the
Securities and Exchange Commission, including Opteum Inc.'s most recent Annual
Report on Form 10-K or Quarterly Report on Form 10-Q. The Company undertakes
no
obligation to publicly update or revise any forward−looking statements, whether
as a result of new information, future events or otherwise. However, the
reader
is directed to the Company’s various filings with the Securities and Exchange
Commission available through the Company’s website at www.opteum.com
or
through the SEC’s website at www.sec.gov.
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* * *
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Opteum
Inc. (the “Company”) is filing this Form 12b-25 to notify the Securities and
Exchange Commission (the “SEC”) of its inability to file its Quarterly Report on
Form 10-Q for the period ended September 30, 2006, by the required due date
of
November 9, 2006, or within the prescribed five calendar day period permitted
under Rule 12b-25(b) for the following reasons:
On
November 3, 2005, the Company acquired Opteum
Financial Services, LLC (“OFS”). Prior to November 3, 2005, OFS was a
privately-held company that was not subject to the reporting requirements
of the
Securities Exchange Act of 1934, as amended. Following the Company’s acquisition
of OFS, a consulting firm was engaged to review
the adequacy of the design and operation of OFS’ internal controls and
procedures for
purposes of ensuring compliance with the Sarbanes-Oxley Act of 2002. In
connection with such review, the consulting firm identified an accounting
policy
used by OFS that was not in accordance with generally accepted accounting
principles (“GAAP”). The accounting policy relates to the manner in which OFS
accounts for interest rate lock commitments (“IRLCs”). Under Statement
of Financial Accounting Standards No. 133 - Accounting
for Derivative Instruments and Hedging Activities
(“SFAS
No. 133”), IRLCs are derivatives that are required to be recorded on the
Company’s consolidated balance sheet at fair value with changes in fair value to
be reflected in the Company’s current period consolidated results of operations.
OFS’ accounting policy resulted in a
misapplication of
SFAS No.
133.
On
Tuesday, November 7, 2006, in connection with the preparation of the Company’s
Quarterly Report on Form 10-Q for the period ended September 30, 2006, the
Company’s Chief Executive Officer, Chief Financial Officer and Audit Committee
of the Board of Directors conditionally concluded that the Company’s
consolidated financial statements as of, and for the periods ended, March
31,
2006, and June 30, 2006, may require restatement as a result of the
misapplication of SFAS No. 133 by the Company’s subsidiary, OFS, during those
periods.
On
Wednesday, November 8, 2006, following verification that the Company’s
consolidated results of operations were materially overstated for the period
ended March 31, 2006, and were materially understated for the period ended
June
30, 2006, the Company’s Chief Executive Officer and Chief Financial Officer
determined that the Company would be unable to file its Quarterly Report
on Form
10-Q for the period ended September 30, 2006, prior to the required due date
of
Thursday, November 9, 2006, because the Company’s consolidated financial
statements contained in its Quarterly Reports on Form 10-Q for the periods
ended
March 31, 2006, and June 30, 2006, require restatement, and such restatements
could not be completed by November 9, 2006, without unreasonable effort or
expense. Additionally, the Company announced on Wednesday, November 8, 2006,
that the Company’s previously filed consolidated financial statements as of, and
for the periods ended, March 31, 2006, and June 30, 2006, should no longer
be
relied upon. The Company’s Chief
Executive Officer, Chief Financial Officer and Audit Committee of the Board
of
Directors discussed the foregoing matters with representatives of the Company’s
independent registered public accounting firm.
The
Company currently expects to file its Quarterly Report on Form 10-Q for the
period ended September 30, 2006, simultaneously with, or within a reasonable
period of time following, the filing of amendments to the Company’s Quarterly
Reports on Form 10-Q for the periods ended March 31, 2006, and June 30, 2006.
While there can be no reasonable assurance given as to the actual dates of
filing, the Company currently anticipates making these filings on or before
December 31, 2006, subject to the prior completion by Ernst & Young LLP of
required procedures for such interim quarterly filings.
PART
IV — OTHER INFORMATION
(1) Name
and
telephone number of person to contact in regard to this notification
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J.
Christopher Clifton, Esq.
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(772)
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231-1400
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(Name)
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(Area
Code)
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(Telephone
Number)
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(2) Have
all
other periodic reports required under Section 13
or
15(d)
of the
Securities Exchange Act of 1934 or Section 30 of the Investment Company Act
of 1940 during the preceding 12 months or for such shorter period that the
registrant was required to file such report(s) been filed? If answer is no,
identify report(s). [X]
Yes [ ] No
(3) Is
it
anticipated that any significant change in results of operations from the
corresponding period for the last fiscal year will be reflected by the earnings
statements to be included in the subject report or portion thereof? [X]
Yes [
]
No
If
so,
attach an explanation of the anticipated change, both narratively and
quantitatively, and, if appropriate, state the reasons why a reasonable estimate
of the results cannot be made.
For
the
three and nine month periods ended September 30, 2005, the Company (known
at the
time as Bimini Mortgage Management, Inc.) reported net income of $7,875,257
and
$27,001,509, respectively. The Company presently anticipates that the Company’s
consolidated results of operations for the three and nine month periods ended
September 30, 2006, as will be reported on the consolidated statement of
operations that will be included in the Company’s Quarterly Report on Form 10-Q
for the quarter ended September 30, 2006, once filed, will reflect a significant
change from the Company’s results of operations for the corresponding prior year
period primarily because the
Company’s acquisition of OFS did not occur until November 3, 2005, and,
accordingly, the results of operations of OFS are not included in the Company’s
results of operations for the three and nine month periods ended September
30,
2005. As a result, comparisons of the Company’s 2006 consolidated results of
operations through September 30, 2006, to the Company’s results of operations
for
the
corresponding prior year periods are not particularly meaningful.
Although
the Company’s review of the full legal, accounting and tax impact of OFS’ prior
accounting policy is ongoing, the Company presently believes that, once
restated, its consolidated results of operations before income taxes for
the six
month period ended June 30, 2006, will be reduced by less than $1 million
from
the Company’s consolidated results of operations before income taxes for the
period ended June 30, 2006, as previously reported. Further, the Company
presently anticipates a partially offsetting increase to the Company’s
consolidated results of operations before income taxes for the quarterly
period
ended September 30, 2006.
The
Company presently believes that it will report a consolidated net loss for
both
the three and nine month periods ended September 30, 2006, and that its
consolidated loss before income taxes for the nine month period ended September
30, 2006, will be greater by less than $1 million as a result of the
restatements described in Part III of this Form 12b-25. Because other
adjustments to the Company’s consolidated financial statements will be made in
connection with the restatements described in Part III of this Form 12b-25,
including required adjustments to the Company’s income tax benefit, as well as
other additional adjustments that, in and of themselves, are immaterial to
the
Company’s consolidated results of operations and financial position, the Company
presently estimates that its consolidated net loss for the nine month period
ended September 30, 2006, will be approximately $15 million to $16
million.
The
Company’s results of operations for both the
three
and nine month periods ended September 30, 2006, were negatively affected
by
changes in various
market interest rates, including short-term rates, due primarily to the monetary
policy actions
of
the Federal Reserve during these periods. The Company’s financing is based on
short-term rates, which increased
during
these periods faster than the yields on the Company’s portfolio of mortgage
backed securities. The
increase in short-term borrowing rates also had a negative impact on the
net
interest spread earned by OFS on its mortgage loans held for sale due to
increases in the funding costs associated with warehouse lines of credit
used to
fund its mortgage loan originations.
Further,
the continuing downward trend in the residential housing market is likely
to
continue to pressure OFS’ mortgage origination levels. As a result, OFS is
likely to continue to experience downward pressure on sales margins brought
about by increasing competitive pressure. Any decline in mortgage originations
due to a cooling of the housing market may be partially offset by appreciation
in the value of OFS’ originated mortgage servicing rights and retained interests
in securitizations, which are generally positively affected by declining
mortgage prepayment rates.
Opteum
Inc.
(Name
of
Registrant as Specified in Charter)
has
caused this notification to be signed on its behalf by the undersigned hereunto
duly authorized.
Date:
November
13, 2006
By:
/s/
Jeffrey J. Zimmer
Jeffrey
J. Zimmer, Chairman, President and Chief Executive Officer