United States
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form
Current Report
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
(Exact Name of Registrant as Specified in its Charter)
| (State or other jurisdiction of incorporation) |
(Commission File Number) | (I.R.S. Employer Identification No.) |
|
|
n/a | |
| (Address of Principal Executive Offices) | (Zip Code) |
Registrant’s telephone number, including
area code: +
N/A
(Former name or former address, if changed since last report)
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 |
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act |
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act |
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act Securities registered pursuant to Section 12(b) of the Act: |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).
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.
| Item 4.02- | Non-Reliance on Previously Issued Financial Statements or Related Audit Report or Completed Interim Report. |
As a result of recent guidance to Special Purpose Acquisition Companies by the SEC regarding redeemable equity instruments, the Company revisited its application of ASC 480-10-S99 on the Company’s financial statements. The Company had previously classified a portion of its Class A ordinary shares in permanent equity. Subsequent to the re-evaluation, the Company’s management concluded that all of its Class A ordinary shares should be classified as temporary equity. The identified errors impacted the Company’s Form 8-K filed on May 20, 2021 containing balance sheet as of April 12, 2021, and Quarterly Report on Form 10-Q filed on August 23, 2021 containing financial statements as of June 30, 2021. In accordance with SEC Staff Accounting Bulletin No. 99, “Materiality,” and SEC Staff Accounting Bulletin No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements;” the Company evaluated the errors and has determined that the related impacts were not material to the aforementioned Form 8-K and Form 10-Q reports, but that correcting the cumulative impact of such errors would be significant to the Company’s statements of operations for the three months ended September 30, 2021 and for the period from January 8, 2021 (inception) through September 30, 2021. Accordingly, the Company has corrected such immaterial errors by adjusting its prior financial statements and classified all its Class A ordinary shares as temporary equity, excluding representative shares and Class A ordinary shares issued sold as part of the Units in the Private Placement. The Company will also correct previously reported financial information for such immaterial errors in future filings, as applicable. The following summarizes the effect of the restatement on each financial statement line item.
In accordance with SEC Staff Accounting Bulletin No. 99, “Materiality,” and SEC Staff Accounting Bulletin No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements;” the Company evaluated the changes and has determined that the related impact was material to any previously presented financial statements. Therefore, the Company, in consultation with its Audit Committee, concluded that its previously issued financial statements as of April 12, 2021 and June 30, 2021 should be restated because of a misapplication in the guidance around complex accounting for financial instruments and should no longer be relied upon. The Company is reporting the restatements to those periods in this Quarterly Report.
Based upon their evaluation, the Company’s Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were not effective as of September 30, 2021, due to the previous material weakness in our internal control over financial reporting as a result of the restatements of the Company’s April 12, 2021, and June 30, 2021 financial statements (the “restatements”) regarding the failure to properly classify redeemable equity instruments. In light of this material weakness, we performed additional analysis as deemed necessary to ensure that our unaudited interim financial statements were prepared in accordance with U.S. generally accepted accounting principles. Accordingly, management believes that the financial statements included in this Quarterly Report on Form 10-Q present fairly in all material respects our financial position, results of operations and cash flows for the period presented.
Therefore, the June 30, 2021 quarterly financial statements included in the Company's Form 10-Qs, as filed with the SEC on August 23, 2021, as well as the Company's balance sheet included on the Company's Form 8-K, as filed with the SEC on May 20, 2021, should no longer be relied upon because certain redemption provisions not solely within the control of the Company require Class A ordinary shares subject to redemption to be classified outside of permanent equity. The Company had previously classified a portion of the Class A ordinary shares in permanent equity. The Company will restate its financial statements to classify all Class A ordinary shares as temporary equity and any related impact, as the threshold in its charter does not change the nature of the underlying shares as redeemable and thus would be required to be disclosed outside of permanent equity. As a result of the foregoing, the Company’s management reassessed the effectiveness of its disclosure controls and procedures for the periods affected by the restatement. As a result of that reassessment, the Company’s management determined that its disclosure controls and procedures for such periods were not effective solely as a result of the foregoing.
There was no change in our internal control over financial reporting that occurred during the fiscal quarter ended September 30, 2021 covered by this Quarterly Report on Form 10-Q, other than the circumstances that led to the mistakes in classification identified in Note 2 — Restatement of Previously Issued Financial Statements, included in Part 1, Item 1 of the quarterly period ending June 30, 2021, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
Management performed additional accounting and financial analyses and other post-closing procedures, including consulting with subject matter experts related to the accounting for complex financial instruments. We have implemented remediation steps to address this material weakness and will continue to take actions to improve our internal control over financial reporting. Specifically, we are in the process of expanding and improving our review process for complex securities and related accounting standards. We are further improving this process by enhancing access to accounting literature, identifying third-party professionals with whom to consult regarding complex accounting applications and considering additional staff with the requisite experience and training to supplement existing accounting professionals.
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 LLP, the Company’s independent registered public accounting firm.
SIGNATURES
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: November 19, 2021 | ||
| MODEL PERFORMANCE ACQUISITION CORP. | ||
| By: | /s/ Serena Shie | |
| Name: | Serena Shie | |
| Title: | Chief Financial Officer | |