Item 4.02. Non-Reliance on Previously Issued Financial Statements or a Related
Audit Report or Completed Interim Review.
Tishman Speyer Innovation Corp. II (the "Company") historically classified a
portion of the Company's shares of redeemable Class A common stock (the "public
shares") as permanent equity to maintain stockholders' equity in excess of
$5,000,000 on the basis that the Company will consummate its initial business
combination only if the Company has net tangible assets of at least $5,000,001.
In connection with the preparation of the Company's Form 10-Q for the quarterly
period ended September 30, 2021 (the "Original Form 10-Q"),
management re-evaluated the Company's application of Accounting Standards
Codification 480-10-S99 with respect to its accounting classification of public
shares and determined that the public shares include redemption provisions that
require classification of all public shares as temporary equity, regardless of
the minimum net tangible asset requirement discussed above. After further
consideration, management re-evaluated the impact of the reclassification of a
portion of the public shares on the Company's previously issued financial
statements and, in consultation with the audit committee of the Company's board
of directors (the "Audit Committee"), concluded that the reclassification is
material with respect to certain of the Company's previously issued financial
statements, as further described below.
On December 16, 2021, the Company's management and the Audit Committee concluded
that (i) the Company's previously issued audited balance sheet as of
February 17, 2021, which was previously revised in the Company's Quarterly
Report on Form 10-Q for the quarterly period ended March 31, 2021, filed with
the Securities and Exchange Commission (the "SEC") on May 25, 2021, (ii) the
Company's previously issued unaudited condensed financial statements as of and
for the three months ended March 31, 2021, which were included in the Company's
Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2021,
filed with the SEC on May 25, 2021, (iii) the Company's previously issued
unaudited condensed financial statements as of and for the three and six months
ended June 30, 2021, which were included in the Company's Quarterly Report on
Form 10-Q for the quarterly period ended June 30, 2021, filed with the SEC on
August 12, 2021, and (iv) Note 2 to the Company's previously issued unaudited
condensed financial statements as of and for the three and nine months ended
September 30, 2021, which were included in the Original Form 10-Q, respectively,
should no longer be relied upon due to the classification error described above.
Accordingly, the Company will restate certain of its previously issued financial
statements in its future filings with the SEC, including in an amendment to the
Original Form 10-Q (the "Form 10-Q/A"). In connection with the restatement, the
Company expects to also correct its earnings per share calculation to allocate
income and losses shared pro rata between the two classes of shares. The
restatement is expected to have no impact on the Company's liquidity or cash
position.
The Company's management has concluded that in light of the classification error
described above, a material weakness existed in the Company's internal control
over financial reporting and that the Company's disclosure controls and
procedures were not effective. The material weakness and the Company's
remediation plan with respect to such material weakness will be described in
more detail in the Form 10-Q/A.
The Audit Committee and management have discussed the matters disclosed in this
Item 4.02(a) with WithumSmith+Brown, PC, the Company's independent registered
public accounting firm.
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