Item 4.02. Non-Reliance on Previously Issued Financial Statements or a Related
Audit Report or Completed Interim Review.
On April 12, 2021, the Acting Director of the Division of Corporation Finance
and Acting Chief Accountant of the Securities and Exchange Commission ("SEC")
together issued a statement regarding the accounting and reporting
considerations for warrants issued by special purpose acquisition companies
entitled "Staff Statement on Accounting and Reporting Considerations for
Warrants Issued by Special Purpose Acquisition Companies ("SPACs")" (the "SEC
Statement"). Specifically, the SEC Statement focused on certain settlement terms
and provisions related to certain tender offers following a business
combination, which terms are similar to those contained in the warrant
agreement, dated as of December 16, 2020, between Corner Growth Acquisition
Corp. (the "Company") and Continental Stock Transfer & Trust Company, a New York
limited purpose trust company, as warrant agent. As a result of the SEC
Statement, the Company reevaluated the accounting treatment of (i) the
13,333,333 redeemable warrants (the "Public Warrants") that were included in the
units issued by the Company in its initial public offering (the "IPO") and
(ii) the 7,600,000 warrants (together with the Public Warrants, the "Warrants")
that were issued to the Company's sponsor in a private placement that closed
concurrently with the closings of the IPO, and determined to classify the
Warrants as derivative liabilities measured at fair value, with changes in fair
value each period reported in earnings. While the Company has not generated any
operating revenues to date and will not generate any operating revenues until
after completion of its initial business combination, at the earliest, the
change in fair value of the Warrants is a non-cash charge and will be reflected
in the Company's statement of operations.
On May 19, 2021, as discussed with Marcum LLP, the Company's independent
registered public accounting firm (the "Independent Auditors"), the Company's
management and the Audit Committee of the Company's Board of Directors (the
"Audit Committee") concluded that, in light of the SEC Statement, it is
appropriate to restate the Company's financial statements as of December 21,
2020, December 31, 2020 and for the period from October 20, 2020 (inception)
through December 31, 2020 (the "Relevant Periods"). Considering such
restatement, such financial statements should no longer be relied upon. As soon
as practicable, the Company will file an amendment to its Annual Report on Form
10-K as of and for the year ended December 31, 2020, which will include the
restated audited financial statements for the Relevant Periods. In addition, the
audit reports of the Independent Auditors included in the Company's Annual
Report on Form 10-K for the year ended December 31, 2020, as filed with the SEC
on March 31, 2021 and the audited balance sheet as of December 21, 2020 as
included in the Company's Current Report on Form 8-K, as filed with the SEC on
December 29, 2020 should no longer be relied upon.
Going forward, unless we amend the terms of our warrant agreement, we expect to
continue to classify our warrants as a liabilities, which would require us to
incur the cost of measuring the fair value of the warrant liabilities, and which
may have an adverse effect on our results of operations.
The Company's management and the Audit Committee have discussed the matters
disclosed in this Current Report on Form 8-K pursuant to this Item 4.02 with the
Independent Auditors.
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