Item 4.02. Non-Reliance on Previously Issued Financial Statements or a Related
Audit Report or Completed Interim Review.
(a) In connection with the preparation of FTAC Athena Acquisition Corp.'s (the
"Company") financial statements as of September 30, 2021, the Company's
management, in consultation with its advisors, identified an error made
in certain of its previously issued financial statements, arising from the
manner in which, as of the closing of the Company's initial public offering, the
Company valued its Class A ordinary shares subject to possible redemption. The
Company previously determined the value of such Class A ordinary shares to be
equal to the redemption value of such Class A ordinary shares, after taking into
consideration the terms of the Company's Amended and Restated Memorandum and
Articles of Association, under which a redemption cannot result in net tangible
assets being less than $5,000,001. Management has now determined, after
consultation with its advisors, that the Class A ordinary shares underlying the
units issued during the initial public offering can be redeemed or become
redeemable subject to the occurrence of future events considered to be
outside the Company's control. Therefore, management has concluded that the
redemption value of its Class A ordinary shares subject to possible redemption
should reflect the possible redemption of all Class A ordinary shares. As a
result, management has noted a reclassification error related to temporary
equity and permanent equity. This has resulted in a restatement of the initial
carrying value of the Class A ordinary shares subject to possible redemption,
with the offset recorded to additional paid-in capital (to the extent
available), accumulated deficit and Class A ordinary shares. In addition, in
connection with the change in presentation for the Class A ordinary
shares subject to possible redemption, the Company has determined it should
restate its earnings per share calculation to allocate income and losses shared
pro rata between the two classes of its shares. This presentation contemplates a
business combination as the most likely outcome, in which case, both classes of
shares share pro rata in the income and losses of the Company.
On November 23, 2021, the audit committee of the board of directors of the
Company (the "Audit Committee"), based on the recommendation of and after
consultation with management, concluded that the Company's (i) audited balance
sheet as of February 25, 2021 (the "Audited Affected Financials") filed as
Exhibit 99.1 to the Company's Current Report on Form 8-K filed with the
Securities and Exchange Commission (the "SEC") on March 3, 2021, as amended as
set forth in the Q-1 Unaudited Financials (as defined below), (ii) unaudited
financial statements as of March 31, 2021 (the "Q-1 Unaudited Financials")
contained in the Company's Quarterly Report on Form 10-Q filed with the SEC on
June 8, 2021, (iii) unaudited financial statements as of June 30, 2021 contained
in the Company's Quarterly Report on Form 10-Q filed with the SEC on August 16,
2021 (together with the Q-1 Unaudited Financials, the "Unaudited Affected
Financials") and (iv) Quarterly Report on Form 10-Q filed with the SEC on
November 12, 2021, should no longer be relied upon due to the error described
above. The Company intends to restate the error in an amendment to its Quarterly
Report on Form 10-Q for the quarterly period ended September 30, 2021 (to
include restatements with respect to the Audited Affected Financials and the
Unaudited Affected Financials) (the "Amended Form 10-Q"). Similarly, the related
press releases, stockholder communications, investor presentations or other
communications describing relevant portions of the Company's financial
statements for these periods, should no longer be relied upon.
The Company does not expect the changes described above to have any impact on
its cash position or the balance held in the trust account.
The Company's management has concluded that in light of the error and
restatement described above, a material weakness exists in the Company's
internal control over financial reporting and that the Company's disclosure
controls and procedures were not effective. The Company's remediation plan with
respect to such material weakness is described in more detail in the Amended
Form 10-Q.
The Audit Committee and management have discussed the matters disclosed pursuant
to this Item 4.02(a) with the Company's independent accountant.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
Exhibit No. Description
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document).
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Additional Information About the Transactions and Where to Find It
The Company intends to file with the SEC a preliminary proxy statement in
connection with the Transactions and will mail a definitive proxy statement and
other relevant documents to its shareholders. The Company's shareholders and
other interested persons are advised to read, when available, the preliminary
proxy statement, and amendments thereto, and the definitive proxy statement in
connection with the Company's solicitation of proxies for its extraordinary
general meeting to be held to approve the Transactions, as these materials will
contain important information about the Company, Pico and the Transactions. The
definitive proxy statement will be mailed to shareholders of the Company as of a
record date to be established for voting on the Transactions. Shareholders will
also be able to obtain copies of the proxy statement, as well as other filings
containing information about the Company, without charge, once available, at the
SEC's website at www.sec.govor by directing a request to: FTAC Athena
Acquisition Corp., 2929 Arch Street, Suite 1703, Philadelphia, PA 19104, Attn:
Amanda Abrams.
Participants in Solicitation
The Company, Pico and certain of their respective directors and officers may be
deemed participants in the solicitation of proxies of the Company's shareholders
with respect to the approval of the Transactions. Information regarding the
Company's directors and officers and a description of their interests in the
Company is contained in the Company's final prospectus relating to its initial
public offering, which was filed with the SEC on February 24, 2021. Additional
information regarding the participants in the proxy solicitation, including
Pico's directors and officers, and a description of their direct and indirect
interests, by security holdings or otherwise, will be included in the proxy
statement for the Transactions when available. Each of these documents is, or
will be, available at the SEC's website or by directing a request to the Company
as described above under "Additional Information About the Transactions and
Where to Find It."
In connection with the Transactions, at any time prior to the extraordinary
general meeting to approve the Transactions, certain existing Company
shareholders, which may include certain of the Company's officers, directors and
other affiliates, may enter into transactions with shareholders and other
persons with respect to the Company's securities to provide such investors or
other persons with incentives in connection with the approval and consummation
of the Transactions. While the exact nature of such incentives has not yet been
determined, they might include, without limitation, arrangements to purchase
shares from or sell shares to such investors and persons at nominal prices or
prices other than fair market value. These shareholders will only effect such
transactions when they are not then aware of any material nonpublic information
regarding the Company, Pico or their respective securities.
Forward Looking Statements
This Current Report on Form 8-K contains "forward-looking statements" within the
meaning of the "safe harbor" provisions of the Private Securities Litigation
Reform Act of 1995. Forward-looking statements may be identified by the use of
words such as "anticipate", "believe", "could", "continue", "expect",
"estimate", "may", "plan", "outlook", "future" and "project" and other similar
expressions that predict or indicate future events or trends or that are not
statements of historical matters. These statements, which involve risks and
uncertainties, relate to analyses and other information that are based on
forecasts of future results and estimates of amounts not yet determinable and
may also relate to the Company's or Pico's future prospects, developments and
business strategies. In particular, such forward-looking statements include
statements concerning the timing of the Transactions; the business plans,
objectives, expectations and intentions of the public company once the
transaction is complete, and Pico's estimated and future results of operations,
business strategies, competitive position, industry environment and potential
growth opportunities. These statements are based on the Company's or Pico's
management's current expectations and beliefs, as applicable, as well as a
number of assumptions concerning future events.
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Such forward-looking statements are subject to known and unknown risks,
uncertainties, assumptions and other important factors, many of which are
outside the Company's or Pico's control that could cause actual results to
differ materially from the results discussed in the forward-looking statements.
These risks, uncertainties, assumptions and other important factors include, but
are not limited to, (1) the occurrence of any event, change or other
circumstances that could give rise to the termination of the Business
Combination Agreement; (2) the inability to complete the Transactions due to the
failure to obtain approval of the shareholders of the Company or other
conditions to closing in the Business Combination Agreement; (3) the ability of
the public entity to meet Nasdaq's listing standards following the Transactions;
(4) the inability to complete the PIPE Investment; (5) the risk that the
proposed transaction disrupts current plans and operations of Pico as a result
of the announcement and consummation of the transactions described herein; (6)
the ability to recognize the anticipated benefits of the proposed business
combination, which may be affected by, among other things, competition, the
ability of the combined company to grow and manage growth profitably, maintain
relationships with suppliers and agents and retain its management and key
employees; (7) costs related to the proposed business combination; (8) changes
in applicable laws or regulations and delays in obtaining, adverse conditions
contained in, or the inability to obtain necessary regulatory approvals required
to complete the business combination; (9) the possibility that Pico may be
adversely affected by other economic, business, regulatory and/or competitive
factors; (10) the outcome of any legal proceedings that may be instituted
against the Company, Pico or any of their respective directors or officers,
following the announcement of the potential transaction; and (11) the failure to
realize anticipated pro forma results and underlying assumptions, including with
respect to estimated shareholder redemptions. Additional factors that could
cause actual results to differ materially from those expressed or implied in
forward-looking statements can be found in the Company's final prospectus for
its initial public offering, subsequently filed quarterly reports on Form 10-Q
and current reports on Form 8-K, which are available, free of charge, at the
SEC's website at www.sec.gov, and will also be provided in the Company's proxy
statement when available. New risks and uncertainties arise from time to time,
and it is impossible for the Company or Pico to predict these events or how they
may affect either party. You are cautioned not to place undue reliance upon any
forward-looking statements, which speak only as of the date made, and the
Company and Pico undertake no obligation to update or revise the forward-looking
statements, whether as a result of new information, future events or otherwise.
Disclaimer
This communication shall not constitute a solicitation of a proxy, an offer to
sell or the solicitation of an offer to buy any securities.
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