Item 4.02. Non-Reliance on Previously Issued Financial Statements or a Related
Audit Report or Completed Interim Review.
On April 12, 2021, the staff (the "Staff") of the Division of Corporation
Finance of the Securities and Exchange Commission issued a statement entitled
"Staff Statement on Accounting and Reporting Considerations for Warrants Issued
by Special Purpose Acquisition Companies" (the "Staff Statement"). The Staff
Statement, among other things, highlighted potential accounting implications of
certain terms that are common in warrants issued in connection with the initial
public offerings of special purpose acquisition companies ("SPACs") such as Apex
Technology Acquisition Corporation (the "Company"). The Staff Statement
reflected the Staff's view that in many cases, warrants issued by SPACs should
be classified as liabilities for accounting purposes, rather than as components
of equity, unless certain conditions are met.
On May 6, 2021, the Company's audit committee (the "Audit Committee"), based on
the recommendation of, and after consultation with, the Company's management,
concluded that the Company's audited financial statements for the years ended
December 31, 2020 and December 31, 2019, and the financial statements for the
quarters ending September 30, 2020, June 30, 2020, March 31, 2020 and September
30, 2019 (collectively, the "Non-Reliance Periods"), as reported in the
Company's Annual Reports on Form 10-Ks filed on March 15, 2021 and March 27,
2020 and in the Company's Quarterly Reports on Form 10-Qs filed on November 16,
2020, August 12, 2020, May 12, 2020 and November 12, 2019 should no longer be
relied upon due to changes required to reclassify the Company's outstanding
warrants as liabilities. Similarly, the related press releases, Report of
Independent Registered Public Accounting Firm dated March 8, 2021 and March 27,
2020 on the audited financial statements as of December 31, 2020 and December
31, 2019 and for the years ended December 31, 2020 and December 31, 2019, and
the 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.
As a result, the Company 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's prior accounting treatment of the warrants as components of equity
instead of as derivative liabilities did not have any effect on the Company's
previously reported operating expenses, cash flows or cash.
The Audit Committee and management have discussed the matters disclosed pursuant
to this Item 4.02 with the Company's independent registered public accounting
firm.
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