Item 4.02. Non-Reliance on Previously Issued Financial Statements or a Related
Audit Report or Completed Interim Review.
Vector Acquisition Corporation II, a Cayman Islands exempted company (the
"Company"), has followed Accounting Standards Codification Topic 480,
"Distinguishing Liabilities from Equity," in accounting for its redeemable
Class A ordinary shares, par value $0.0001 per share (the "Public Shares"). This
included recording a portion of the Public Shares in permanent equity on its
balance sheet. However, the Company maintained shareholders' equity of at least
$5,000,001 as the Company will not redeem Public Shares that would cause the
Company's net tangible assets to be less than $5,000,001 following redemptions
of its Public Shares.
In November 2021, Company management re-evaluated its position that
classification of $5,000,001 in permanent equity was appropriate and determined
that the Public Shares should instead be reclassified as temporary equity. In
connection with the preparation of the unaudited interim condensed financial
statements as of and for the three and nine months ended September 30, 2021 that
were included in the Company's Quarterly Report on Form 10-Q, filed with the
Securities and Exchange Commission (the "SEC") on November 10, 2021 (the "Q3
Form 10-Q"), the Company concluded that it would change its accounting and
reflect the full amount of all redeemable Public Shares in temporary equity on
its balance sheet. In connection with the change in presentation for the Public
Shares subject to possible redemption, the Company also restated its earnings
per share to allocate net income (loss) evenly to all Public Shares and Class B
ordinary shares. This was a change from the Company's previous accounting
practice whereby it maintained shareholders' equity of at least $5,000,001 as
the Company will not redeem Public Shares that would cause the Company's net
tangible assets to be less than $5,000,001 following redemptions of its Public
Shares.
On January 3, 2022, the Company's management and the Audit Committee of the
Company's Board of Directors (the "Audit Committee"), concluded that the
Company's previously issued (i) audited balance sheet as of March 12, 2021 (the
"Affected Initial Balance Sheet"), (ii) unaudited interim condensed financial
statements as of and for the three months ended March 31, 2021 included in the
Company's Quarterly Report on Form 10-Q, filed with the SEC on May 24, 2021 (the
"Q1 Form 10-Q"), (iii) unaudited interim condensed financial statements as of
and for the three and six months ended June 30, 2021 included in the Company's
Quarterly Report on Form 10-Q, filed with the SEC on August 13, 2021 (the "Q2
Form 10-Q"), and (iv) the unaudited interim condensed financial statements as of
and for the three and nine months ended September 30, 2021 (the "Q3 Form
10-Q") (collectively, items (ii), (iii), and (iv), the "Affected Periods"), in
each case, should be restated to classify all of the Public Shares as temporary
equity and should no longer be relied upon. As such, the Company will restate
its financial statements for (i) the Affected Periods in an amended Quarterly
Report on Form 10-Q/A for the quarterly period ended September 30, 2021 (the
"Amended Q3 Form 10-Q") and (ii) the Affected Initial Balance Sheet in an
amended Current Report on Form 8-K/A.
The Amended Q3 Form 10-Q will include restatements of the unaudited interim
condensed financial statements for the periods ended March 31, 2021, June 30,
2021 and September 30, 2021 set forth in the Q1 Form 10-Q, the Q2 Form 10-Q and
the Q3 Form 10-Q, respectively.
The Company's management has concluded that, as a result of the events leading
to the restatement of the financial statements for the Affected Periods
described above, a material weakness existed and the Company's disclosure
controls and procedures were not effective for the quarterly period ended
September 30, 2021. The Company's remediation plan with respect to such material
weakness is described in more detail in the Amended Q3 Form 10-Q.
The Audit Committee and the Company's management have discussed the matters
disclosed in this Current Report on Form 8-K with Withum, the Company's
independent registered public accounting firm.
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