RIGETTI COMPUTING, INC. : Non-Reliance on Previous Financials, Audits or Interim Review (form 8-K)

Article 4.02. Non-reliance on previously issued financial statements or any related

           Audit Report or Completed Interim Review.


(a)

Op November 14, 2022the Audit Committee of the Board of Directors of the Company (“Audit Committee”), based on the recommendation of, and after consultation with the management of the Company, and as discussed with BDO USA, LLP (“BDO”), the Company’s independent registered public accounting firm, has completed the Company’s previously issued unaudited interim condensed consolidated financial statements for the quarter ended. March 31, 2022 in the June 30, 2022 (“Affected Finances”), each as before with the SECshould no longer be trusted and should be discontinued due to the matters described below.

At the closing of the company’s business combination with Supernova Partners Acquisition Company II Ltd. on March 2, 2022 (the “Closing”), (i) 2,479,000 shares of common stock, par value of $0.0001 per share (“Common Stock”), held by Supernova Partners II LLC (the “SPAC Sponsor”) (such Shares, the “Promote Sponsor Vesting Shares”) have been subject to and will be deemed unvested and will vest only if, during the five-year period following the Closing, the volume-weighted average price of the Common Stock equals or exceeded $12.50 for every twenty trading days within a period of thirty consecutive trading days, and (ii) 580,273 shares of Common Stock held by the SPAC Sponsor (“Sponsor Redemption-Based Vesting Shares”) were subject to vesting and considered unvested and will only vest if , during the five-year period following the closing, the volume weighted average price of the Common Stock is equal to or greater than $15.00 for every twenty trading days within a period of thirty consecutive trading days (collectively, the Promote Sponsor Vesting Shares and Sponsor Redemption-Based Vesting Shares, “Sponsor Vesting Shares”). Any Sponsor Vesting Shares that remain unvested after the fifth anniversary of the Closing will be forfeited.

The Sponsor Vesting Shares are accounted for as liability-classified instruments because the earn-out trigger events that determine the number of Sponsor Vesting Shares to be earned back by the SPAC sponsor include outcomes that are not indexed solely to the Common Stock. As part of the company’s accounting for the expected liability related to the sponsor vesting shares in connection with the preparation of the financial statements for the third quarter of 2022, the company evaluated the valuation assumptions used for the fair To estimate the value of the sponsor vesting. Stocks using a Monte Carlo simulation model. During this evaluation, it was determined that the volatility assumption used in the assessment of the earn-out liability related to the Sponsor Vesting Shares was based on a weighted average of the volatilities of the trading price of the common stock for a group of comparable. public companies and the Common Stock and the trading price of the company’s public warrants in the assumption, should be revised to include a greater weight for the volatility of the trading price of the company’s public warrants and should thus have a greater weight in include the preparation of the company. Concerned finance. This revised weighting used for the volatility assumption in estimating the fair value of the sponsor vesting shares is expected to have the following impact:

     •    a decrease in the Earnout Liabilities recorded on the unaudited condensed
          consolidated balance sheet as of March 31, 2022 and June 30, 2022
          included in the Affected Financials;



     •    a decrease in the Change in the Fair Value of Earn-out Liability recorded
          in the unaudited condensed consolidated statements of operations for the
          periods ended March 31, 2022 and June 30, 2022 included in the Affected
          Financials;



     •    an increase in Net loss and Net loss per share recorded in the unaudited
          condensed consolidated statements of operations for the periods ended
          March 31, 2022 and June 30, 2022 included in the Affected Financials; and



     •    a decrease in the Fair value of earn-out liability recorded in the
          unaudited condensed consolidated statements of cash flows as supplemental
          disclosure of non-cash financing activities for the periods ended
          March 31, 2022 and June 30, 2022 included in the Affected Financials.

In addition, the Company completes its analysis with respect to the treatment of additional operating expenses estimated at approximately approx
$1.6 million in the aggregate relating to electric utility charges for a portion of electric usage at its Berkeley location since 2019 that were not paid and recognized in prior periods. The Company is evaluating how to account for these additional operating costs, which are expected to include a recording of the estimated additional electric consumption fees paid to the utility provider.

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financial statements for the quarter ended March 31, 2022 in the June 30, 2022 and recorded operating expenses in its financial statements for the quarter ended
September 30, 2022. It is expected that the impact of the additional operating expenses accrued expenses and other current liabilities in the unaudited condensed consolidated balance sheet and the research and development expenses, operating expenses, operating loss and net loss recorded in the unaudited consolidated consolidated operating statements and the related financials.

As part of the restatement of the financial statements for the quarter ended
March 31, 2022 in the June 30, 2022the company expects the correction of an immaterial error related to the valuation of the guarantee liability with respect to the warrants issued to Trinity Capital Inc. March 31, 2022and reverse the previous correction it had previously recorded for such immaterial errors in the financial statements for the quarter ended June 30, 2022 in the restated financial statements for that period. In addition, the Company also evaluates the fair value calculations for its private warrants, which are treated as derivative warrant bonds for the periods ended. March 31, 2022 in the June 30, 2022. Any revisions resulting from the revaluation affect the reported amount of the derivative guarantee liability on the balance sheets and the change in the fair value of the derivative guarantee liability on the operating statements. It is possible that additional adjustments may be identified in connection with the further assessment of the company.

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The company’s management assesses the effect of the foregoing on the company’s internal control over financial reporting and disclosure controls and procedures, resulting in a material weakness in its internal control related to accounting for complex instruments in addition to the previously reported Material from the company may result. Weakness in its internal control over financial reporting related to the lack of effective review controls over the accounting for complex warrant instruments, which resulted in its disclosure controls and procedures being determined to be ineffective in the first quarter of 2022 and the second quarter of 2022. , as previously revealed. It is possible that such assessment may result in the identification of other material weaknesses.

In addition, the related press releases, shareholder communications, investor presentations or other communications describing the relevant portions of the affected financials should no longer be relied upon. As a result, the Company intends to disclose the affected financials through a Form 10-Q/A, Amendment No. March 31, 2022 in the June 30, 2022. In addition, the company is filing with the SEC a Form 12b-25 because it is unable, without undue effort or expense, to file its quarterly report on Form 10-Q for the three and nine months September 30, 2022 within the prescribed time period the necessary work, including the determination of any required adjustments and the corresponding impact on the financial statements included in the financial statements of the company for such periods and the evaluation of its internal controls over financial reporting and Disclosure controls and procedures are ongoing.

The Company’s management and the Audit Committee have discussed the matters disclosed in this Current Report on Form 8-K with BDO.

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Cautionary Language Regarding Forward-Looking Statements

Certain statements in this Current Report on Form 8-K may be considered forward-looking statements, including statements with respect to the expected adjustments and effects on the Company’s financial statements, the expected revision of the valuation methodology with respect to sponsor vesting Shares, the estimated amount and impact of additional operating costs related to electricity consumption on the company’s financial statements, expectations regarding the company’s internal control over financial reporting and disclosure controls and procedures, expectations regarding the valuation methodology for the accounting of the private guarantee and the impact on the financial statements of the company, the potential for additional adjustments to the financial statements of the company, expectations about the reflection of the warrants issued to Trinity Capital in the financial statements , and the expected filing of a Form 10-Q/A, Amendment No. 1, for each of the quarters passed
March 31, 2022 in the June 30, 2022. Forward-looking statements generally refer to future events and can be identified by terminology such as “may,” “should,” “could,” “could,” “plan,” “possible,” “aim,” “budget,” “expect “, “intend”, “will”, “estimate”, “believe”, “anticipate”, “potential”, “pursue”, “goal”, “goal”, “mission”, “anticipate” or “continue”, ” or the negatives of these terms or variations thereof or similar terminology. Such forward-looking statements are subject to risks, uncertainties, and other factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. These forward-looking statements -forward-looking statements are based on estimates and assumptions that, if reasonably believed by the company and its management, are inherently uncertain. Factors that could cause actual results to differ materially from actual expectations include, but are not limited to, risks and uncertainties, those in the Rub rik “Risk Factors” and “Cautionary Note Rearding Forward-Looking Statements” are set forth in the company’s Form 10-Q. for the quarter ended June 30, 2022and other documents issued by the company from time to time with the SEC. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to place undue reliance on forward-looking statements, and Rigetti assumes no obligation and does not intend to update or revise these forward-looking statements other than as required by applicable law. The company gives no assurance that it will meet its expectations.

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