Filing Summary
Business Context and Reporting Period
Power & Digital Infrastructure Acquisition Corp. (the SPAC associated with the proposed Core Scientific transaction) filed this Form 8-K on November 15, 2021. The filing concerns previously issued financial statements and is not an operating results report for Core Scientific.
Material Accounting and Financial Changes
Management and the Audit Committee concluded, in consultation with Marcum LLP, that the following previously issued financial information should no longer be relied upon:
- The audited balance sheet as of February 9, 2021.
- Quarterly unaudited financial statements and related footnotes for the periods ended March 31, 2021 and June 30, 2021.
- Marcum’s audit report included in the February 4, 2021 Form 8-K.
The issue relates to reclassification between temporary and permanent equity and a restatement of the initial carrying value of Class A common stock subject to possible redemption.
Liquidity, Cash Flow, Debt, and Other Metrics
The filing does not provide revenue, profit, cash-flow, margin, debt, or operating performance metrics. The company stated that the accounting changes are not expected to affect its cash position or the cash held in its trust account.
Outlook, Contingencies, and Unusual Items
Management determined that IPO shares can be redeemed or become redeemable upon future events outside the company’s control. Accordingly, shares subject to possible redemption should be valued at $10.00 per share without considering the $5,000,001 net tangible asset limitation.
The company planned to reflect the reclassification and related changes as of February 12, 2021 and for the quarters ended March 31 and June 30, 2021 in its upcoming Form 10-Q for the quarter ended September 30, 2021. The filing does not state the final dollar impact of the restatement.
Key Investor Verification Items
- Verify the subsequent Form 10-Q and any amended filings for the restated balance sheet and quarterly financial statements.
- Confirm the amount and presentation of Class A shares subject to possible redemption after reclassification.
- Confirm that trust-account cash and total cash were unchanged, as stated by management.
- Review any updated auditor report or disclosures from Marcum LLP.
- Assess whether the accounting correction affects the proposed business combination, redemption calculations, or shareholder equity presentation.