Item 4.02
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Non-Reliance on Previously Issued Financial Statements or a
Related Audit Report or Completed Interim Review.
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(a) On April 12, 2021, the staff (the Staff) of
the Securities and Exchange Commission (the SEC) issued a statement entitled Staff Statement on Accounting and Reporting Considerations for Warrants Issued by Special Purpose Acquisition Companies (SPACs). In the
statement, the Staff, among other things, highlighted potential accounting implications of certain terms that are common in warrants issued in connection with the initial public offerings of SPACs such as dMY Technology Group, Inc. II (the
Company or dMY).
The warrant agreement governing the warrants includes a provision that provides for potential
changes to the settlement amounts dependent on the characteristics of the holder of the warrant. Upon review of the statement by the SEC Staff, the Companys management further evaluated the warrants under Accounting Standards Codification
(ASC) Subtopic 815-40, Contracts in Entitys 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 issuers common stock. Under
ASC Section 815-40-15, a warrant is not indexed to the issuers 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 managements evaluation, the Companys audit committee (the Audit Committee), in consultation with management concluded that the
Companys warrants are not indexed to the Companys common stock in the manner contemplated by ASC Section 815-40-15 because the characteristics
of the holder of the instrument is not an input into the pricing of a fixed-for-fixed option on equity shares.
On April 26, 2021, the Audit Committee, based on the recommendation of and after consultation with management, concluded that the
Companys (i) audited financial statements as of and for the year ended December 31, 2020 and (ii) unaudited interim financial statements as of and for the quarterly period ended September 30, 2020 (collectively, the Non-Reliance Periods), as reported in the Companys Annual Report on Form 10-K filed on March 26, 2021 and Quarterly Report on Form 10-Q filed on November 16, 2020 should no longer be relied upon based on the reclassification of warrants as described above. Similarly, Report of Independent Registered Public Accounting Firm dated
February 24, 2021 on the financial statements as of December 31, 2020 and for the period from June 18, 2020 (date of inception) through December 31, 2020, and the stockholder communications, investor presentations or other
communications describing relevant portions of the Companys financial statements for these periods that need to be restated should no longer be relied upon.
As a result, the Company today is announcing that it will restate its historical financial results for
the Non-Reliance Periods, in each case to reflect the change in accounting treatment (the Restatement). The Company is filing its
Form 10-K/A for the year ended December 31, 2020 to reflect the Restatement contemporaneously with the filing of this Form 8-K.
The Companys prior accounting for the warrants as components of equity instead of as derivative liabilities did not have any effect on
the Companys previously reported operating expenses, cash flows or cash or cash equivalents.
The Audit Committee and management
have discussed the matters disclosed pursuant to this Item 4.02(a) with the Companys independent accountant.