**UNITED STATESSECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

 

**FORM 10-K/A**

**(Amendment No. 1)**

 
| **ý** | ** ** | **ANNUAL  REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF  1934**     |
|------------|------------|-------------------------------------------------------------------------------------------------|
| ** ** | ** ** | ** **                                                                                      |
| ** ** | ** ** | **For the fiscal year ended December 31, 2004**                                                 |
| ** ** | ** ** | **or**                                                                                          |
| ** ** | ** ** | ** **                                                                                      |
| **o**      | ** ** | **TRANSITION  REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF  1934** |

 

**Commission File Number 0-27517**

 

**GAIAM, INC.**

(Exact name of registrant as specified in its charter)

 
| **COLORADO**                                                     | ** ** | **84-1113527**                         |
|------------------------------------------------------------------|------------|----------------------------------------|
| (State  or other jurisdiction of  incorporation or organization) |       | (I.R.S.  Employer  Identification No.) |
|                                                             |       |                                   |
| **360 INTERLOCKEN BOULEVARD**                                    |
| **BROOMFIELD, CO 80021**                                         |
| (Address  of principal executive offices)                        |
|                                                             |       |
| **(303) 222-3600**                                               |
| (Registrant’s  telephone number, including area code)       |
|                                                             |       |                                   |
| Securities  registered pursuant to Section 12(b) of the Act:     |
| **None**                                                         |
|                                                             |       |                                   |
| Securities  registered pursuant to section 12(g) of the Act:     |
| **Class A Common Stock, $.0001 par value**                       |

 

Indicateby check mark whether the registrant (1) has filed all reports required to befiled by Section 13 or 15(d) of the Securities Exchange Act of 1934 during thepreceding 12 months (or for such shorter period that the registrant wasrequired to file such reports), and (2) has been subject to such filing requirementsfor the past 90 days.  YES ý   NO o

 

Indicateby check mark if disclosure of delinquent filers pursuant to Item 405 ofRegulation S-K (§229.405 of this chapter) is not contained herein, and will notbe contained, to the best of registrant’s knowledge, in definitive proxy orinformation statements incorporated by reference in Part III of this Form 10-Kor any amendment to the Form 10-K.  o

 

Indicateby check mark whether the registrant is an accelerated filed (as defined inRule 12b-2 of the Act.)  YES ý   NO o

 

Theaggregate market value of the voting stock held by non-affiliates of theregistrant was approximately $46,210,453 as of June 30, 2004, based upon theclosing price on the NASDAQ National Market on that date.  The registrant does not have non-votingcommon equity.

 

Asof March 1, 2005, 9,411,897 shares of the registrant’s $.0001 par value Class Acommon stock and 5,400,000 shares of the registrant’s Class B common stock wereoutstanding.

 

 

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**DOCUMENTS INCORPORATED BY REFERENCE**

 

Thefollowing documents (or portions thereof) are incorporated by reference intothe Parts of this Form 10-K noted:

 

PartIII incorporates by reference from the definitive proxy statement for theregistrant’s 2005 Annual Meeting of Shareholders to be filed with theCommission pursuant to Regulation 14A not later than 120 days after the end ofthe fiscal year covered by this Form.

 

**EXPLANATORY NOTE**

 

Gaiam,Inc. is filing this amendment to Form 10-K for the year ended December 31,2004, filed with the Securities and Exchange Commission on March 3, 2005 (“OriginalFiling”) in accordance with the Commission’s Exemptive Order # 34-50754, to:

 

•                  include a Report of Independent RegisteredPublic Accounting Firm relating to our internal control over financialreporting,

 

•                  amend and restate Item 9A to includeManagement’s Annual Report on Internal Control Over Financial Reporting, and

 

•                  to include a revised Consent of IndependentRegistered Public Accounting Firm required as a result of the revisionsdiscussed above.

 

Asa result of these amendments, the certifications pursuant to Section 302 andSection 906 of the Sarbanes-Oxley Act of 2002, filed as exhibits to the OriginalFiling, have been re-executed and re-filed as of the date of this Form 10-K/A.

 

Exceptfor the amendments described above, this Form 10-K/A does not modify or updateother disclosures in, or exhibits to, the Original Filing.

 

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**REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**

 

Board of Directors andStockholders

Gaiam, Inc.

Broomfield, Colorado

 

We have audited management’sassessment, included in the accompanying Management’s Report on InternalControl over Financial Reporting included in Item 9A, that Gaiam, Inc. (the “Company”)maintained effective internal control over financial reporting as of December31, 2004, based on criteria established in *InternalControl-Integrated Framework* issued by the Committee of SponsoringOrganizations for the Treadway Commission (the “COSO Criteria”).  The Company’s management is responsible formaintaining effective control over financial reporting and for its assessmentof the effectiveness of internal control over financial reporting.  Our responsibility is to express an opinionon management’s assessment and an opinion on the effectiveness of the Company’sinternal control over financial reporting based on our audit.

 

We conducted our audit inaccordance with the standards of the Public Company Accounting Oversight Board(United States).  Those standards requirethat we plan and perform the audit to obtain reasonable assurance about whethereffective internal control over financial reporting was maintained in allmaterial respects.  Our audit includedobtaining an understanding of internal control over financial reporting,evaluating management’s assessment, testing and evaluating the design andoperating effectiveness of internal control, and performing such otherprocedures as we considered necessary in the circumstances.  We believe our audit provides a reasonablebasis for our opinion.

 

A company’s internal controlover financial reporting is a process designed to provide reasonable assuranceregarding the reliability of financial reporting and the preparation offinancial statements for external purposes in accordance with accountingprinciples generally accepted in the United States.  A company’s internal control over financialreporting includes those policies and procedures that (1) pertain to themaintenance of records that, in reasonable detail, accurately and fairlyreflect the transactions and dispositions of the assets of the company; (2)provide reasonable assurance that transactions are recorded as necessary topermit preparation of financial statements in accordance with accountingprinciples generally accepted in the United States, and that receipts andexpenditures of the company are being made only in accordance withauthorizations of management and directors of the company; and (3) providereasonable assurance regarding prevention or timely detection of unauthorizedacquisition, use, or disposition of the company’s assets that could have amaterial effect on the financial statements.

 

Because of its inherentlimitations, internal control over financial reporting may not prevent ordetect misstatements.  Also, projectionsof any evaluation of effectiveness to future periods are subject to the riskthat controls may become inadequate because of changes in conditions, or thatthe degree of compliance with the policies and procedures may deteriorate.

 

In our opinion, management’sassessment that Gaiam, Inc. maintained effective internal control overfinancial reporting as of December 31, 2004, is fairly stated, in all materialrespects, based on the COSO Criteria. Also, in our opinion, Gaiam, Inc. maintained, in all material respects,effective internal control over financial reporting as of December 31, 2004,based on the COSO Criteria.

 

We also have audited, inaccordance with the standards of the Public Company Accounting Oversight Board(United States), the consolidated balance sheet of Gaiam, Inc. as of December31, 2004, and the related consolidated statements of operations, stockholders’equity and cash flows for the year then ended, and our report dated February 15,2005 expressed an unqualified opinion thereon.

 
|              | /s/  Ehrhardt Keefe Steiner & Hottman P.C. |
|-------------------|------------------------------------------------|
|              |                                           |
| March  15, 2005   |                                           |
| Denver,  Colorado |                                           |

 

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**Item 9A.              Controlsand Procedures.**

 

**Evaluation of Disclosure Controls and Procedures**

 

Gaiam’schief executive officer and chief financial officer conducted an evaluation ofthe effectiveness of the design and operation of Gaiam’s disclosure controlsand procedures, as defined in Rules 13a-15(e) and Rule 15d-15(e) under theExchange Act.  Based upon theirevaluation as of December 31, 2004, they have concluded that those disclosurecontrols and procedures are effective.

 

**Changesin Internal Control over Financial Reporting**

 

Therehave been no changes in Gaiam’s internal control over financial reporting duringthe quarter ended December 31, 2004 that have materially affected, or arereasonably likely to affect, Gaiam’s internal control over financial reporting.

 

**Management’sReport on Internal Control over Financial Reporting**

 

Themanagement of Gaiam is responsible for establishing and maintaining adequateinternal control over financial reporting as defined in Rule 13a-15(f) underthe Exchange Act.  Our internal controlover financial reporting is a process designed to provide reasonable assuranceregarding the reliability of financial reporting and the preparation offinancial statements for external purposes in accordance with accountingprinciples generally accepted in the United States of America.  Because of its inherent limitations, internalcontrol over financial reporting may not prevent or detect misstatements.  Also, projections of any evaluation ofeffectiveness to future periods are subject to the risk that controls maybecome inadequate because of changes in conditions, or that the degree of compliancewith the policies or procedures may deteriorate.

 

Gaiam’smanagement assessed the effectiveness of Gaiam’s internal control overfinancial reporting as of December 31, 2004. In making the assessment, it used the criteria set forth by theCommittee of Sponsoring Organizations of the Treadway Commission (COSO) in “*Internal Control-Integrated Framework*.”  Based on that assessment, managementconcluded that, as of December 31, 2004, Gaiam’s internal control overfinancial reporting is effective based on those criteria.

 

Gaiam’sassessment of the effectiveness of Gaiam’s internal control over financialreporting as of December 31, 2004 has been audited by Ehrhardt Keefe Steiner& Hottman P.C., an independent registered accounting firm, as stated intheir report, which is included herein.

 

**Exhibits**

** **

The followingexhibits are filed or furnished with this report as indicated below:

 
| **Exhibit No.** | ** ** | **Description**                                                                                                                                |
|-----------------|------------|------------------------------------------------------------------------------------------------------------------------------------------------|
| 23.1            |       | Consent letter from  Ehrhardt Keefe Steiner & Hottman P.C. (filed herewith).                                                               |
| 31.1            |       | Certification of the  Chief Executive Officer pursuant to Rule 13a-14(a) under the Securities  Exchange Act of 1934 (filed herewith).          |
| 31.2            |       | Certification of the  Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities  Exchange Act of 1934 (filed herewith)           |
| 32.1            |       | Certification pursuant  to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the  Sarbanes-Oxley Act of 2002 (furnished herewith). |
| 32.2            |       | Certification pursuant  to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the  Sarbanes-Oxley Act of 2002 (furnished herewith). |

 

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**SIGNATURES**

 

Pursuant to the requirementsof Section 13 or 15(d) of the Securities and Exchange Act of 1934, theRegistrant has caused this report to be signed on its behalf by theundersigned, thereunto duly authorized.

 

 
|           | GAIAM, INC. |
|----------------|-------------|
|           |        |
|           |        |
|           | By:         | /s/ Janet Mathews |   |
|           |        | Janet Mathews |
|           |        | Chief Financial Officer |
|           |        |
| March 21, 2005 |        |

 

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