Item 4.02 Non-Reliance on Previously Issued Financial Statements or Related
Audit Report or Completed Interim Report.
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, dated as of January 6, 2021, between Bright Lights
Acquisition Corp., a Delaware corporation ("Bright Lights" or the "Company") and
Continental Stock Transfer & Trust Company, a New York corporation, as warrant
agent. As a result of the SEC Statement, the Company reevaluated the accounting
treatment of (i) the 11,500,000 redeemable warrants (the "Public Warrants") that
were included in the units issued by the Company in its initial public offering
(the "IPO") and (ii) the 6,600,000 redeemable warrants (together with the Public
Warrants, the "Warrants") that were issued to the Company's sponsor in a private
placement that closed concurrently with the closing of the IPO, and determined
to classify the Warrants as derivative liabilities measured at fair value, with
changes in fair value each period reported in earnings. While the Company has
not generated any operating revenues to date and will not generate any operating
revenues until after completion of its initial business combination, at the
earliest, the change in fair value of the Warrants is a non-cash charge and will
be reflected in the Company's statement of operations.
On May 27, 2021, after consultation with Marcum LLP, the Company's independent
registered public accounting firm (the "Independent Accountants"), the Company's
management and the Audit Committee of the Company's Board of Directors (the
"Audit Committee") concluded that, in light of the SEC Statement, it is
appropriate to restate certain items on the Company's previously issued audited
balance sheet as of January 11, 2021, which was related to the IPO. Considering
such restatement, such financial statement, as well as the relevant portions of
any communication which describes or are based on such financial statement,
should no longer be relied upon and certain line items have been restated in the
balance sheet as of January 11, 2021 which can be found in the the Company's
Quarterly Report on Form 10-Q for the period ended March 31, 2021, filed with
the SEC on May 28, 2021. In addition, the audit report of the Independent
Accountants included in the Company's Form 8-K filed with the SEC on January 15,
2021 should no longer be relied upon.
Going forward, unless we amend the terms of our warrant agreement, we expect to
continue to classify our warrants as liabilities, which would require us to
incur the cost of measuring the fair value of the warrant liabilities, and which
may have an adverse effect on our results of operations.
The Company's management and the Audit Committee have discussed the matters
disclosed in this Current Report on Form 8-K/A pursuant to this Item 4.02 with
the Independent Accountants.
Forward-Looking Statements Legend
This Current Report on Form 8-K/A may include "forward-looking statements"
within the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. All statements
other than statements of historical fact included in this report are
forward-looking statements. When used in this report, words such as
"anticipate," "believe," "estimate," "expect," "intend" and similar expressions,
as they relate to us or our management team, identify forward-looking
statements. Such forward-looking statements are based on the beliefs of
management, as well as assumptions made by, and information currently available
to, the Company's management. Actual results could differ materially from those
contemplated by the forward-looking statements as a result of certain factors
detailed in the Company's filings with the SEC. All subsequent written or oral
forward-looking statements attributable to us or persons acting on our behalf
are qualified in their entirety by this paragraph. Forward-looking statements
are subject to numerous conditions, many of which are beyond the control of the
Company, including those set forth in the Risk Factors section of the Company's
Annual Report on Form 10-K, as amended from time to time. Copies of such filings
are available on the SEC's website, www.sec.gov. The Company undertakes no
obligation to update these statements for revisions or changes after the date of
this release, except as required by law.
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