UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
(Amendment No. 1)
CURRENT REPORT
Pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
March 22, 2022 (
(Exact name of registrant as specified in its charter)
|
(State or other jurisdiction of incorporation or organization) |
(Commission File Number) | (I.R.S. Employer Identification Number) |
(212) 583-8540
(Address of principal executive offices, including zip code)
(
(Registrant’s telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered | ||
| The Stock Market LLC | ||||
| The | ||||
| The Stock Market LLC |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.
Emerging growth company
If an emerging growth company, indicate by check
mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting
standards provided pursuant to Section 13(a) of the Exchange Act.
EXPLANATORY NOTE
The Company is filing this Amendment No. 1 on Form 8-K/A to reflect a restatement of the Company’s IPO Balance Sheet, to (i) reclassify a portion of its public shares from permanent equity to temporary equity and (ii) to account for its outstanding warrants to purchase its Class A common stock sold in the Initial Public Offering and Private Placement as derivative liabilities, in each case as further described in the footnotes of the Exhibit.
Background of Restatement
On April 12, 2021, the Acting Director of the Division of Corporation Finance and Acting Chief Accountant of the 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 governing the Company’s warrants. The Company previously accounted for the Warrants as components of equity.
The Company’s management evaluated the Warrants under Accounting Standards Codification (“ASC”) Subtopic 815-40, Contracts in Entity’s Own Equity. ASC Section 815-40-15 addresses equity versus liability treatment and classification of equity-linked financial instruments, including warrants, and states that a warrant may be classified as a component of equity only if, among other things, the warrant is indexed to the issuer’s common stock. Under ASC Section 815-40-15, a warrant is not indexed to the issuer’s common stock if the terms of the warrant require an adjustment to the exercise price upon a specified event and that event is not an input to the fair value of the warrant. Based on management’s evaluation, the Company’s audit committee, in consultation with management, concluded that the Company’s Private Placement Warrants are not indexed to the Company’s common stock in the manner contemplated by ASC Section 815-40-15 because the holder of the instrument is not an input into the pricing of a fixed-for-fixed option on equity shares. In addition, based on management’s evaluation, the Company’s audit committee, in consultation with management, concluded that the tender offer provision fails the “classified in shareholders’ equity” criteria as contemplated by ASC Section 815-40-25. As a result of the above, the Company should have classified the Warrants as derivative liabilities in its previously issued financial statement as of March 4, 2021 on Form 8-K filed with the Securities and Exchange Commission on March 10, 2021.
The audited balance sheet is being
restated to reflect the classification of all of the Company’s Class A common stock as temporary equity in accordance with ASC 480-10-S99.
The Company had previously classified a portion of its Class A common stock as permanent equity. On November 29, 2021, the Audit Committee
of the Board of Directors of the Company concluded, after discussion with the Company’s management, that the Company’s audited
balance sheet as of March 4, 2021 filed as Exhibit 99.1 to the Original 8-K should no longer be relied upon due to the aforementioned
changes required to reclassify the Class A common stock as temporary equity to align with ASC 480-10-S99. The Audit Committee of the Board
of Directors of the Company and the Company’s independent accountants are in agreement with the matters disclosed in this Amendment.
The correction of the aforementioned classification of the Class A common stock as temporary equity is reflected in Exhibit 99.1 included
with this Amendment. 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. The Company’s controls over financial reporting did not provide for the proper classification of the Class A common
stock within the Company’s financial statements. As such, this represented a material weakness in the Company’s internal controls.
Except as described above, this Amendment does
not amend, update or change any other disclosures in the Original 8-K. In addition, the information contained in this Amendment does not
reflect events occurring after the filing of the Original 8-K and does not modify or update the disclosures therein, except as specifically
identified above. Among other things, forward-looking statements made in the Original 8-K have not been revised to reflect events, results
or developments that occurred or facts that became known to the Company after the date of the Original 8-K, other than as described herein,
and such forward-looking statements should be read in conjunction with the Company’s filings with the SEC.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
| 99.1 | Audited Balance Sheet | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Dated: March 22, 2022
| ORION ACQUISITION CORP. | ||
| By: | /s/ Beau Garverick | |
| Name: | Beau Garverick | |
| Title: | Chief Executive Officer and Chief Financial Officer | |
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