Item 4.02 Non-Reliance on Previously Issued Financial Statements or a Related
Audit Report or Completed Interim Review.
In light of recent guidance, the management of Atlas Crest Investment Corp. II
("Atlas II," "we," "us" or "our") has re-evaluated the application of
ASC 480-10-S99-3A to Atlas II's accounting classification of the redeemable
shares of Class A common stock, par value $0.0001 per share (the "Public
Shares"), issued as part of the units sold in our initial public offering (the
"IPO") on February 3, 2021.
Historically, a portion of the Public Shares was classified as permanent equity
to maintain net tangible assets greater than $5,000,000 on the basis that Atlas
II will consummate its initial business combination only if it has net tangible
assets of at least $5,000,001.
Pursuant to such re-evaluation, our management has determined that the Public
Shares include certain provisions that require classification of the Public
Shares as temporary equity regardless of the minimum net tangible assets
required to complete Atlas II's initial business combination.
On November 29, 2021, Atlas II's management and the audit committee of Atlas
II's board of directors (the "Audit Committee"), after discussion with Marcum
LLP ("Marcum"), Atlas II's independent registered public accounting firm,
concluded that Atlas II's previously issued (i) audited balance sheet as of
February 8, 2021 filed as Exhibit 99.1 to Atlas II's Current Report on Form
8-K filed with the SEC on February 12, 2021 (the "Form 8-K"), (ii) 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 24, 2021 , (iii) unaudited interim financial statements included in Atlas
II's Quarterly Report on Form 10-Q for the quarterly period ended June 30,
2021, filed with the SEC on August 16, 2021 , and (iv) unaudited interim
financial statements included in Atlas II's Quarterly Report on Form 10-Q for
the quarterly period ended September 30, 2021, filed with the SEC on November 5,
2021 (collectively, the "Affected Periods"), should no longer be relied upon
and that it is appropriate to restate Atlas II's financial statements for the
Affected Periods. Accordingly, Atlas II will restate its financial statements
for the Affected Periods in amendments to each of the filings listed above to be
filed with the SEC as soon as practicable, to classify all Public Common Stock
as temporary equity at redemption value and any related impact, as the threshold
in its charter would not change the nature of the underlying shares as
redeemable and thus would be required to be classified outside of permanent
equity.
Atlas II 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.
Atlas II's management has concluded that in light of the classification error
described above, a material weakness exists in Atlas II's internal control over
financial reporting and that the Atlas II's disclosure controls and procedures
were not effective for all periods noted above. Atlas II's remediation plan with
respect to such material weakness will be described in more detail in the Q3
Form 10-Q.
Atlas II'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.
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