Item 4.02 Non-Reliance on Previously Issued Financial Statements or
a Related Audit Report or Completed Interim Review.
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(a)
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On April 12, 2021, the Acting Director of the Division of Corporation
Finance and Acting Chief Accountant of the Securities and Exchange Commission released a Staff Statement on Accounting and Reporting
Considerations for Warrants Issued by Special Purpose Acquisition Companies (the SEC Statement”). The SEC Staff Statement highlighted
potential accounting implications of certain terms that are common in warrants issued in connection with initial public offerings of
SPACs. The SEC Staff Statement clarified guidance for all SPAC-related companies regarding the accounting and reporting for their warrants
that could result in the warrants issued by SPACs being accounted for as liabilities measured at fair value, rather than equity securities,
with changes in fair value during each period reported in earnings.
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Following consideration of the SEC Statement, the
Company re-evaluated its historical accounting for its public warrants and private placement warrants issued in connection with the Company’s
initial public offering (the “Warrants”) and determined that the Warrants should have been classified as liabilities measured
at fair value in the affected financial statements, with changes in fair value in each period reported in earnings.
On May 10, 2021, the
Audit Committee of the Board of Directors of the Company, after consultation with management, concluded that the Company's previously
issued consolidated financial statements as of and for the year ended December 31, 2020 included in the Company's Annual Report on Form
10-K (collectively, the "Non-Reliance Periods") should no longer be relied upon based on the reclassification described above.
Any report on the audited consolidated financial statements of the Company's independent registered public accounting firm, press releases,
stockholder communications, investor presentations or other communications regarding the Non-Reliance Periods should no longer be relied
upon.
The Company will restate its historical financial
results for the Non-Reliance Periods to reflect the change in accounting treatment for the Warrants (the “Restatement”). The
Company will file an amendment to its Annual Report on Form 10-K for the year ended December 31, 2020 to reflect the Restatement as soon
as possible.
The Audit Committee has discussed the matters
disclosed in this Item 4.02(a) with the Grant Thornton LLP, the Company's independent accountant.
Forward Looking Statements
Statements in this report, including all statements
regarding the Restatement, 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 present
or historical fact included in this report, regarding Hyliion and its future financial and operational performance, as well as its strategy,
future operations, estimated financial position, estimated revenues, and losses, projected costs, prospects, plans and objectives of management
are forward looking statements. When used in this report, including any oral statements made in connection therewith, the words “could,”
“should,” “will,” “may,” “believe,” “anticipate,” “intend,” “estimate,”
“expect,” “project,” the negative of such terms and other similar expressions are intended to identify forward-looking
statements, although not all forward-looking statements contain such identifying words. These forward-looking statements are based on
management’s current expectations and assumptions about future events and are based on currently available information as to the
outcome and timing of future events. Except as otherwise required by applicable law, Hyliion expressly disclaims any duty to update any
forward-looking statements, all of which are expressly qualified by the statements herein, to reflect events or circumstances after the
date of this report. Hyliion cautions you that these forward-looking statements are subject to numerous risks and uncertainties, most
of which are difficult to predict and many of which are beyond the control of Hyliion. These risks include, but are not limited to, the
discovery of additional information relevant to the Non-Reliance Periods; changes in the effects of the Restatement on the Company’s
financial statements or financial results; higher than expected charges after completing the Restatement process; delays in filing amended
filings for the Non-Reliance Periods due to the Company’s efforts to complete the Restatement; and the other risks detailed from
time to time in the Company’s reports filed with the SEC including the risks and uncertainties set forth in “Risk Factors”
section of Hyliion’s annual report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on February
26, 2021 for the year ended December 31, 2020. Should one or more of the risks or uncertainties described in this report occur, or should
underlying assumptions prove incorrect, actual results and plans could different materially from those expressed in any forward-looking
statements.