Filing Summary
Business Context and Reporting Period
Novus Capital Corporation II, a special purpose acquisition company, filed this Form 8-K under Item 4.02 on November 14, 2021; the report was signed and dated November 17, 2021. The filing concerns previously issued financial statements and related internal controls, rather than operating results. The filing text identifies Novus as the registrant and does not provide operating information for Energy Vault Holdings, Inc.
Financial Reporting Issue
- The audited balance sheet filed as of February 8, 2021, and the unaudited financial statements included in the quarterly reports for the periods ended March 31, 2021 and June 30, 2021 should no longer be relied upon.
- The error involved the classification of certain Class A common stock subject to possible redemption. Some shares had been classified within permanent equity, although the redemption provisions required classification outside permanent equity as temporary equity under ASC 480-10-S99.
- Management performed a quantitative assessment under SAB 99 and concluded that a restatement was required to classify all Class A common stock subject to possible redemption as temporary equity.
- The restatement was included in the financial statements for the period ended September 30, 2021.
Material Changes, Controls, and Risk Considerations
- Management concluded that the classification error represented a material weakness in internal control over financial reporting.
- Management also concluded that disclosure controls and procedures were not effective.
- The Audit Committee reached its non-reliance conclusion after discussions with Marcum LLP, the independent registered public accounting firm, and provided Marcum an opportunity to review the disclosures.
- The filing does not provide revised dollar amounts, effects on total assets or liabilities, changes to net income, cash flow, liquidity, debt, or other financial metrics.
Guidance and Outlook
The filing provides no operating guidance, financial outlook, management forecast, or discussion of business performance. The principal disclosed risk is reliance on previously issued financial statements that contained a material classification error and the related material weakness in controls.
Key Facts for Investors to Verify
- Review the September 30, 2021 quarterly report for the restated balance sheet and the quantitative impact of reclassifying redeemable Class A common stock.
- Verify whether subsequent filings describe remediation of the material weakness and improvements to disclosure controls.
- Confirm the final reporting date and filing chronology, because the Form 8-K states an earliest event date of November 14, 2021 but was signed November 17, 2021.
- Assess the implications of the restatement for the SPAC transaction, redemption calculations, and reported equity balances.