Company: RAIN
Filing Date: 2025-01-31
Form Type: S-1
Source: 0001213900-25-008536
Chunk: 38

Company: Rain Enhancement Technologies Holdco, Inc.
Filing Date: 2025-01-31
Form: S-1
Chunk 38
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 gross deferred tax assets
and a full valuation allowance, it lacked certain required disclosures, including the components of the net deferred tax asset, the net
change during the year of the valuation allowance, the current and deferred tax amounts and the income tax rate reconciliation. RET’s
management also discovered errors in calculating the previously disclosed gross deferred tax assets.

Accordingly, RET’s
management and its board of directors concluded that RET’s previously issued audited financial statements as of and for the year
ended December 31, 2023 and as of December 31, 2022 and for the period from November 10, 2022 (inception) through December 31,
2022 as included in the Registration Statement on Form S-4, as filed confidentially with the SEC on August 27, 2024 in connection
with the Business Combination, should no longer be relied upon and that it was appropriate to restate such financial statements in order
to correct such error in such financial statements. The change in accounting for the correction of the error in calculating the gross
deferred tax asset and offsetting valuation allowance and the lack of noted income tax disclosures did not have any impact on RET’s
liquidity, cash flows, costs of operating in the period included in RET’s audited financial statements in this prospectus. This
change also does not impact the amounts previously reported for RET’s cash, operating expenses or total cash flows from operations
for the affected years.

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As a public company, Holdco’s management is
responsible for establishing and maintaining adequate internal control over financial reporting designed to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with
U.S. GAAP, as defined by the FASB.

In connection with the restatement of RET’s
audited financial statements as of and for the year ended December 31, 2023 and as of December 31, 2022 and for the period from
November 10, 2022 (inception) through December 31, 2022, RET’s management identified a material weakness in RET’s
internal controls over financial reporting regarding the calculation of deferred tax assets and disclosure of income taxes in accordance
with FASB ASC 740-10-50. RET’s management determined that the material weakness had not been remediated as of September 30,
2024. A material weakness is a deficiency, or a combination of deficiencies