Item 4.02. Non-Reliance on Previously Issued Financial Statements or a Related
Audit Report or Completed Interim Review.
In light of recent comment letters issued by the U.S. Securities and Exchange
Commission (the "SEC"), the management of ScION Tech Growth I (the "Company")
has re-evaluated the Company's application of ASC 480-10-S99-3A to its
accounting classification of the redeemable Class A ordinary shares, par value
$0.0001 per share (the "Public Shares"), issued as part of the units sold in the
Company's initial public offering (the "IPO") on December 21, 2020.
Historically, a portion of the Public Shares was classified as permanent equity
to maintain shareholders' equity greater than $5 million on the basis that the
Company will not redeem its Public Shares in an amount that would cause its net
tangible assets to be less than $5,000,001, as described in the Company's
amended and restated memorandum and articles of association (the "Articles").
Pursuant to such re-evaluation, the Company's management has determined that the
Public Shares include certain provisions that require classification of all of
the Public Shares as temporary equity regardless of the net tangible assets
redemption limitation contained in the Articles.
Therefore, on November 15, 2021, the Company's management and the audit
committee of the Company's board of directors (the "Audit Committee"), after
consultation with Marcum LLP ("Marcum"), the Company's independent registered
public accounting firm, concluded that the Company's previously issued (i)
audited balance sheet as of December 21, 2021, as previously restated in the
Company's Annual Report on Form 10-K/A for the year ended December 31, 2020,
filed with the SEC on May 17, 2021 (the "2020 10-K/A"), (ii) audited financial
statements included in the 2020 10-K/A, (iii) unaudited interim financial
statements included in the Company's Quarterly Report on Form 10-Q for the
quarterly period ended March 31, 2021, filed with the SEC on May 17, 2021, and
(iv) unaudited interim financial statements included in the Company's Quarterly
Report on Form 10-Q for the quarterly period ended June 30, 2021, filed with the
SEC on August 16, 2021 (collectively, the "Affected Periods"), should be
restated to report all Public Shares as temporary equity and should no longer be
relied upon. As such, the Company intends to restate its financial statements
for the Affected Periods in the Company's Quarterly Report on Form 10-Q for the
quarterly period ended September 30, 2021, to be filed with the SEC (the "Q3
Form 10-Q").
The Company does not expect any of the above changes will have any impact on its
cash position and cash held in the trust account established in connection with
the IPO (the "Trust Account").
The Company's management has concluded that in light of the classification error
described above, a material weakness exists in the Company's internal control
over financial reporting and that the Company's disclosure controls and
procedures were not effective. The Company's remediation plan with respect to
such material weakness will be described in more detail in the Q3 Form 10-Q.
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
Marcum.
Forward-Looking Statements
This Current Report on Form 8-K includes "forward-looking statements" within the
meaning of the safe harbor provisions of the United States Private Securities
Litigation Reform Act of 1995. Certain of these forward-looking statements can
be identified by the use of words such as "believes," "expects," "intends,"
"plans," "estimates," "assumes," "may," "should," "will," "seeks," or other
similar expressions. Such statements may include, but are not limited to,
statements regarding the impact of the Company's restatement of certain
historical financial statements, the Company's cash position and cash held in
the Trust Account and any proposed remediation measures with respect to
identified material weaknesses. These statements are based on current
expectations on the date of this Current Report on Form 8-K and involve a number
of risks and uncertainties that may cause actual results to differ
significantly. The Company does not assume any obligation to update or revise
any such forward-looking statements, whether as the result of new developments
or otherwise. Readers are cautioned not to put undue reliance on forward-looking
statements.
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