Item 4.01. Changes in Registrant’s Certifying
Accountant
(a)
Dismissal of Independent Registered Public Accounting
Firm
On
April 29, 2021, the Audit Committee of the Board of Directors of
American Acquisition Opportunity Inc. (or the
“Company”) approved the dismissal of Marcum LLP
(“Marcum”) as the Company’s independent
registered public accounting firm.
The
reports of Marcum on the Company’s financial statements as of
January 22, 2021 and for the period January 20, 2021 through
January 22, 2021 and the Company’s balance sheet as of March
22, 2021 did not contain an adverse opinion or a disclaimer of
opinion, and were not qualified or modified as to uncertainty,
audit scope or accounting principles other than an explanatory
paragraph relating to the Company’s ability to continue as a
going concern.
During
the period January 20, 2021 through January 22, 2021 through the
date of termination, April 29, 2021, there were no
“disagreements” with Marcum on any matter of accounting
principles or practices, financial statement disclosure or auditing
scope or procedure, which disagreements if not resolved to the
satisfaction of Marcum would have caused Marcum to make reference
thereto in its reports on the consolidated financial statement for
such years. During the period January 20, 2021 through January 22,
2021 and through April 29, 2021, there have been no
“reportable events” (as defined in Item 304(a)(1)(iv)
and Item 304(a)(1)(v) of Registration S-K).
The
Company provided Marcum with a copy of the disclosure it is making
herein in response to Item 304(a) of Regulation S-K, and requested
Marcum furnish the Company with a copy of its letter addressed to
the Securities and Exchange Commission (the “SEC”),
pursuant to Item 304(a)(3) of Regulation S-K, stating whether or
not Marcum agrees with the statements related to them made by the
Company in this report. A copy of Marcum’s letter dated May
4, 2021 is attached as Exhibit 16.1 to this report.
(b)
Newly Engaged Independent Registered Public Accounting
Firm
On
April 29, 2021, the Audit Committee approved the appointment of BF
Borgers CPA, PC (“BF Borgers”) as the Company’s
new independent public accounting firm, effective immediately.
Prior to engaging BF Borgers, neither the Company, nor anyone on
its behalf, consulted BF Borgers regarding either (i) the
application of accounting principles to a specified transaction,
either completed or proposed, or the type of audit opinion that
might be rendered with respect to the consolidated financial
statements of the Company, and no written report or oral advice was
provided to the Company by BF Borgers that was an important factor
considered by the Company in reaching a decision as to any
accounting, auditing or financial reporting issue; or (ii) any
matter that was the subject of a "disagreement" (as defined in Item
304(a)(1)(iv) of Regulation S-K and the related instructions) or a
“reportable event” (as that term is defined in Item
304(a)(1)(v) of Regulation S-K).
Item 4.02. Non-Reliance on Previously Issued Financial Statements
or a Related Audit Report or Completed Interim Review.
(b) On
May 1, 2021, Marcum informed management of its conclusion that the
Company’s (i) audited balance sheet dated March 22, 2021,
that was filed with the SEC as an Exhibit to a Current Report on
Form 8-K filed on March 29, 2021, (ii) the unaudited pro forma
balance sheet dated March 22, 2021 that was filed on April 6, 2021
reflecting the partial exercise of over-allotment option by the
underwriters (“Underwriters”) of the Company’s
initial public offering, (collectively the “Affected Period
Financial Statements”) should no longer be relied upon due to
the continued research regarding how the Company accounted for its
outstanding warrants to purchase shares of Class A common stock,
par value $0.0001 per share of the Company (“Class A Common
Stock”). The Company has issued 5,253,001 warrants to
purchase shares of its Class A Common Stock at $11.50 per share,
which were included in the units sold in the Company’s
initial public offering (the “Public Warrants”) and
3,701,621 warrants to purchase shares of Class A Common Stock at
$11.50 per share, which were sold in a private placement (the
“Private Placement Warrants”). In each case, the total
number of warrants includes those issued due to the partial
exercise of the underwriters’ over-allotment option. The
Company had been accounting for the Warrants as components of
equity instead of as liabilities.
On
April 12, 2021, the Staff at the U.S. Securities and Exchange
Commission (the “SEC”) issued a statement (the
“Statement”) discussing the accounting implications of
certain terms that are common in warrants issued by special purpose
acquisition companies (“SPACs”). In light of the
Statement, the Company’s management evaluated the terms of
the Warrant Agreement entered into in connection with the
Company’s initial public offering and concluded that the
Company’s Public Warrants and Private Placement Warrants
(together, the “Warrants”) include provisions (the
“Extraordinary Transaction Provisions”) that, based on
the Statement, preclude the Warrants from being classified as
components of equity. As a result, the Company is required to
classify the Warrants as liabilities in the Affected Period
Financial Statements. Under this accounting treatment, the Company
is required to measure the fair value of the Warrants at the end of
each reporting period and recognize changes in the fair value from
the prior period in the Company’s operating results for the
current period.
While
the Company is still in the process of obtaining a valuation of the
Warrants, in connection with its termination as independent
auditor, Marcum stated that it was its belief the impact will be
material thereby requiring a restatement of the previously-issued
financial statements. As such, Marcum stated that the
previously-issued financial statements should no longer be relied
upon.
The
Company has provided Marcum with a copy of this disclosure.
Attached as Exhibit 16.2 is a letter dated May 4, 2021 from Marcum
regarding the disclosure.