| Item 4.02 | Non-Reliance on Previously Issued Financial Statement or Related Audit Report or Completed Interim Review. |
(a) On May 7, 2021, the Board of Directors (the “Board”) of Gores Holdings V, Inc. (the “Company”), based on the recommendation of the Audit Committee of the Board (the “Audit Committee”) and after consultation with management and our independent public accountants, KPMG LLP (the “Independent Public Accountants”), concluded that its audited balance sheet as of August 10, 2020, unaudited interim financial statements for the period ended September 30, 2020, and its audited financial statements for the year ended December 31, 2020 (collectively, the “Impacted Periods”), as reported in the Company’s Current Report on Form 8-K filed on August 14, 2020, Quarterly Report on Form 10-Q filed on November 6, 2020, and Annual Report on Form 10-K filed on February 26, 2021, respectively, should be restated to reflect the impact of guidance issued by the SEC in the Statement (as defined below) and accordingly, should no longer be relied upon.
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” (the “Statement”). In the Statement, the Staff, among other things, highlighted potential accounting considerations of certain terms that are common in warrants issued in connection with the initial public offerings of special purpose acquisition companies such as the Company’s public warrants and private placement warrants issued in connection with the Company’s initial public offering (the “Warrants”). The Company previously classified its Warrants as equity. For a full description of the Warrants, please refer to the Company’s final prospectus dated August 5, 2020 and filed with the SEC on August 7, 2020 in connection with its initial public offering. In connection with such Statement, the Company revisited its accounting for its Warrants, and determined that they should be treated as derivative liabilities pursuant to ASC 815-40 rather than as components of equity. The correction involves only non-cash adjustments, and will have no impact on the Company’s current or previously reported liquidity, cash flows or revenues.
As a result, the Company today is announcing that it will restate its historical financial results for the Impacted 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 Audit Committee and management have discussed the matters disclosed pursuant to this Item 4.02(a) with the Company’s Independent Public Accountants.
Cautionary Statements Regarding Forward-Looking Statements
This Current Report on Form 8-K includes “forward-looking statements” within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Certain of these forward-looking statements can be identified by the use of words such as “believes,” “expects,” “intends,” “plans,” “estimates,” “assumes,” “may,” “should,” “will,” “seeks,” or other similar expressions. Such statements may include, but are not limited to, statements regarding the Company’s intent to restate certain historical financial statements and the timing and impact of the Restatement. These statements are based on current expectations on the date of this Form 8-K and involve a number of risks and uncertainties that may cause actual results to differ significantly. The Company does not assume any obligation to update or revise any such forward-looking statements, whether as the result of new developments or otherwise. Readers are cautioned not to put undue reliance on forward-looking statements.
