Document and Entity Information
Document and Entity Information | 3 Months Ended |
Mar. 31, 2021 | |
Document and Entity Information [Abstract] | |
Document Type | S-1/A |
Entity Registrant Name | ROTH CH ACQUISITION II CO.* |
Entity Filer Category | Non-accelerated Filer |
Entity Small Business | true |
Entity Emerging Growth Company | true |
Entity Ex Transition Period | false |
Entity Central Index Key | 0001824403 |
Amendment Flag | true |
Amendment Description | AMENDMENT NO. 1 |
CONDENSED BALANCE SHEETS
CONDENSED BALANCE SHEETS | Dec. 31, 2020USD ($) |
Current assets | |
Cash | $ 696,567 |
Prepaid expenses | 395,887 |
Total current assets | 1,092,454 |
Cash and marketable securities held in Trust Account | 115,006,613 |
Total assets | 116,099,067 |
Current liabilities | |
Accrued expenses | 83,654 |
Total Liabilities | 83,654 |
Contingencies and commitments (Note 16) | |
Common stock subject to possible redemption; 11,063,863 and 11,088,616 shares at redemption value at June 30, 2021 and December 31, 2020, respectively | 111,015,410 |
Stockholder's Equity | |
Common stock, $0.00001 par value; 1,000,000 shares authorized, 145,560 shares issued and outstanding at March 31, 2021; and 140,227 shares issued and outstanding at March 31, 2020 | 355 |
Additional paid-in capital | 5,104,258 |
Accumulated deficit | (104,610) |
Total Reservoir Holdings Inc. shareholders' equity | 5,000,003 |
Total liabilities and shareholders' equity | 116,099,067 |
As Revised | |
Current assets | |
Cash | 696,567 |
Prepaid expenses and other current assets | 395,887 |
Total current assets | 1,092,454 |
Cash and marketable securities held in Trust Account | 115,006,613 |
Total assets | 116,099,067 |
Current liabilities | |
Accrued expenses | 83,654 |
Total current liabilities | 83,654 |
Warrant liabilities | 129,250 |
Total Liabilities | 212,904 |
Contingencies and commitments (Note 16) | |
Common stock subject to possible redemption; 11,063,863 and 11,088,616 shares at redemption value at June 30, 2021 and December 31, 2020, respectively | 110,886,160 |
Stockholder's Equity | |
Common stock, $0.00001 par value; 1,000,000 shares authorized, 145,560 shares issued and outstanding at March 31, 2021; and 140,227 shares issued and outstanding at March 31, 2020 | 357 |
Additional paid-in capital | 5,122,609 |
Accumulated deficit | (122,963) |
Total Reservoir Holdings Inc. shareholders' equity | 5,000,003 |
Total liabilities and shareholders' equity | $ 116,099,067 |
CONDENSED BALANCE SHEETS (Paren
CONDENSED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Common shares, par value, (per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 |
Common stock, shares, authorized | 50,000,000 | 50,000,000 | 50,000,000 |
Common stock, shares, issued | 3,586,137 | 3,548,459 | 2,875,000 |
Common stock, shares, Outstanding | 3,586,137 | 3,548,459 | 2,875,000 |
Temporary equity, shares issued | 11,063,863 | 11,101,541 | 11,101,541 |
Temporary equity, shares outstanding | 11,063,863 | 11,101,541 | 11,101,541 |
As Revised | |||
Common shares, par value, (per share) | $ 0.0001 | ||
Common stock, shares, authorized | 50,000,000 | ||
Common stock, shares, issued | 3,561,384 | ||
Common stock, shares, Outstanding | 3,561,384 | ||
Temporary equity, shares issued | 11,088,616 | ||
Temporary equity, shares outstanding | 11,088,616 |
CONDENSED STATEMENTS OF OPERATI
CONDENSED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | 11 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | |
Operating and formation costs | $ 204,239 | $ 85 | $ 1,225 | $ 109,998 |
Operating income | (204,239) | (85) | (1,225) | (109,998) |
Other income (expense): | ||||
Interest earned on marketable securities held in Trust Account | 6,208 | 5,785 | ||
Change in fair value of warrant liabilities | (49,500) | |||
Other expense, net | (43,292) | 6,613 | ||
Loss before income taxes | (247,531) | (85) | ||
Net income attributable to Reservoir Holdings Inc. | $ (247,531) | $ (85) | $ (1,225) | $ (103,385) |
Weighted average shares outstanding, basic and diluted | 11,088,616 | |||
Basic and diluted net loss per common share | $ 0 | |||
Class A Common Stock Subject to Redemption | ||||
Other income (expense): | ||||
Weighted average shares outstanding, basic and diluted | 11,088,616 | |||
Basic and diluted net loss per common share | $ 0 | $ 0 | ||
Class A Common Stock Not Subject to Redemption | ||||
Other income (expense): | ||||
Weighted average shares outstanding, basic and diluted | 3,561,384 | 2,500,000 | 2,500,000 | 2,545,512 |
Basic and diluted net loss per common share | $ (0.07) | $ 0 | $ 0 | $ (0.04) |
CONDENSED STATEMENTS OF CHANGES
CONDENSED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) | Common Stock | Additional Paid-In Capital | Retained earnings (Accumulated deficit) | Total |
Balance at the beginning (in shares) at Dec. 31, 2019 | 288 | 24,712 | (1,225) | 23,775 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income | $ 0 | $ 0 | $ (85) | $ (85) |
Balance at the end at Mar. 31, 2020 | $ 288 | $ 24,712 | $ (1,310) | $ 23,690 |
Balance at the end (in shares) at Mar. 31, 2020 | 2,875,000 | |||
Balance at the beginning (in shares) at Dec. 31, 2019 | 288 | 24,712 | (1,225) | 23,775 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Common stock subject to possible redemption | $ (1,111) | $ (111,014,299) | $ (111,015,410) | |
Common stock subject to possible redemption (in shares) | (11,101,541) | |||
Net income | $ (103,385) | (103,385) | ||
Balance at the end at Dec. 31, 2020 | $ 357 | 5,122,609 | (122,963) | 5,000,003 |
Balance at the end (in shares) at Dec. 31, 2020 | 3,561,384 | |||
Balance at the beginning at Mar. 31, 2020 | $ 288 | 24,712 | (1,310) | 23,690 |
Balance at the beginning (in shares) at Mar. 31, 2020 | 2,875,000 | |||
Balance at the end at Mar. 31, 2021 | $ 359 | 5,370,137 | (370.494) | 5,000,002 |
Balance at the end (in shares) at Mar. 31, 2021 | 3,586,137 | |||
Balance at the beginning at Dec. 31, 2020 | $ 357 | 5,122,609 | (122,963) | 5,000,003 |
Balance at the beginning (in shares) at Dec. 31, 2020 | 3,561,384 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Common stock subject to possible redemption | $ 2 | 247,528 | 247,530 | |
Common stock subject to possible redemption (in shares) | 24,753 | |||
Net income | 0 | (247,531) | (247,531) | |
Balance at the end at Mar. 31, 2021 | $ 359 | $ 5,370,137 | $ (370.494) | $ 5,000,002 |
Balance at the end (in shares) at Mar. 31, 2021 | 3,586,137 |
CONDENSED STATEMENTS OF CASH FL
CONDENSED STATEMENTS OF CASH FLOWS - USD ($) | Feb. 12, 2019 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Cash flows from operating activities | |||||||
Net income | $ (247,531) | $ (85) | $ (1,225) | $ (103,385) | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Interest earned on marketable securities held in Trust Account | (6,208) | (5,785) | |||||
Unrealized gain on marketable securities held in Trust Account | (828) | ||||||
Change in fair value of warrant liabilities | 49,500 | ||||||
Changes in operating assets and liabilities: | |||||||
Prepaid expenses | 15,332 | (395,887) | |||||
Accrued expenses | 41,380 | (225) | 1,225 | 82,429 | |||
Net cash provided by operating activities | (147,527) | (310) | (423,456) | ||||
Cash flows from investing activities: | |||||||
Net cash used for investing activities | (115,000,000) | ||||||
Cash flows from financing activities: | |||||||
Issuance of common shares, net of issuance costs | 25,000 | ||||||
Proceeds from sale of Units, net of underwriting discounts paid | 113,850,000 | ||||||
Proceeds From Sale Of Private Units | 2,750,000 | ||||||
Proceeds from promissory note - related party | 200,000 | ||||||
Payment of offering costs | (504,977) | ||||||
Net cash provided by financing activities | 25,000 | 116,095,023 | |||||
Net Change in Cash | $ 25,000 | (147,527) | (310) | $ 671,567 | |||
Cash, cash equivalents and restricted cash beginning of year | 696,567 | 25,000 | $ 24,690 | 25,000 | |||
Cash and cash equivalents end of year | 549,040 | $ 24,690 | $ 25,000 | $ 549,040 | 696,567 | $ 25,000 | |
Non-Cash investing and financing activities: | |||||||
Change in value of common stock subject to possible redemption | $ (247,530) | $ (102,110) |
DESCRIPTION OF ORGANIZATION AND
DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS | ||
DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS | NOTE 1. DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS Roth CH Acquisition II Co. (formerly known as Roth Acquisition I Co.) (the “Company”) was incorporated in Delaware on February 13, 2019. The Company is a blank check company formed for the purpose of entering into a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization or other similar business combination with one or more businesses or entities (the “Business Combination”). The Company is an early stage and emerging growth company and, as such, the Company is subject to all of the risks associated with early stage and emerging growth companies. As of March 31, 2021, the Company had not commenced any operations. All activity for the period from February 13, 2019 (inception) through March 31, 2021 relates to the Company’s formation and the initial public offering (“Initial Public Offering”), which is described below. The Company will not generate any operating revenues until after the completion of a Business Combination, at the earliest. The Company will generate non-operating income in the form of interest income from the proceeds derived from the Initial Public Offering. The registration statement for the Company’s Initial Public Offering was declared effective on December 10, 2020. On December 15, 2020, the Company consummated the Initial Public Offering of 11,500,000 units (the “Units” and, with respect to the shares of common stock included in the Units sold, the “Public Shares”), which includes the full exercise by the underwriters of their over-allotment option in the amount of 1,500,000 Units, at $10.00 per Unit, generating gross proceeds of $115,000,000, which is described in Note 3. Simultaneously with the closing of the Initial Public Offering, the Company consummated the sale of 275,000 units (the “Private Units”) at a price of $10.00 per Private Unit in a private placement to certain of the Company’s stockholders, generating gross proceeds of $2,750,000, which is described in Note 4. Transaction costs amounted to $1,654,977 consisting of $1,150,000 of underwriting fees, and $504,977 of other offering costs. Following the closing of the Initial Public Offering on December 15, 2020, an amount of $115,000,000 ($10.00 per Unit) from the net proceeds of the sale of the Units in the Initial Public Offering and the sale of the Private Units was placed in a trust account (the “Trust Account”), located in the United States and will be held in cash items or invested in U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act, with a maturity of 185 days or less or in any open-ended investment company that holds itself out as a money market fund selected by the Company meeting the conditions of Rule 2a-7 of the Investment Company Act of 1940, as amended (the “Investment Company Act”), as determined by the Company, until the earlier of: (i) the completion of a Business Combination and (ii) the distribution of the Trust Account, as described below. The Company’s management has broad discretion with respect to the specific application of the net proceeds of the Initial Public Offering and the sale of the Private Units, although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination. There is no assurance that the Company will be able to complete a Business Combination successfully. The Company must complete a Business Combination having an aggregate fair market value of at least 80% of the assets held in the Trust Account (excluding taxes payable on income earned on the Trust Account) at the time of the agreement to enter into an initial Business Combination. The Company will only complete a Business Combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. The Company will provide its holders of the outstanding Public Shares (the “public stockholders”) with the opportunity to redeem all or a portion of their Public Shares upon the completion of a Business Combination either (i) in connection with a stockholder meeting called to approve the Business Combination or (ii) by means of a tender offer. The decision as to whether the Company will seek stockholder approval of a Business Combination or conduct a tender offer will be made by the Company, solely in its discretion. The public stockholders will be entitled to redeem their Public Shares for a pro rata portion of the amount then in the Trust Account (initially anticipated to be $10.00 per Public Share, plus any pro rata interest earned on the funds held in the Trust Account and not previously released to the Company to pay its tax obligations). There will be no redemption rights upon the completion of a Business Combination with respect to the Company’s warrants. The Company will proceed with a Business Combination if the Company has net tangible assets of at least $5,000,001 either immediately prior to or upon such consummation of a Business Combination and, if the Company seeks stockholder approval, a majority of the shares voted are voted in favor of the Business Combination. If a stockholder vote is not required by law and the Company does not decide to hold a stockholder vote for business or other legal reasons, the Company will, pursuant to its Amended and Restated Certificate of Incorporation (the “Amended and Restated Certificate of Incorporation”), conduct the redemptions pursuant to the tender offer rules of the U.S. Securities and Exchange Commission (“SEC”) and file tender offer documents with the SEC containing substantially the same information as would be included in a proxy statement prior to completing a Business Combination. If, however, stockholder approval of the transaction is required by law, or the Company decides to obtain stockholder approval for business or legal reasons, the Company will offer to redeem shares in conjunction with a proxy solicitation pursuant to the proxy rules and not pursuant to the tender offer rules. If the Company seeks stockholder approval in connection with a Business Combination, the holders of the Company’s shares prior to the Initial Public Offering (the “Initial Stockholders”) have agreed to vote their Founder Shares (as defined in Note 5), Private Shares (as defined in Note 4) and any Public Shares purchased during or after the Initial Public Offering (a) in favor of approving a Business Combination and (b) not to redeem any shares in connection with a stockholder vote to approve a Business Combination or sell any shares to the Company in a tender offer in connection with a Business Combination. Additionally, each public stockholder may elect to redeem their Public Shares irrespective of how or whether they vote on the proposed transaction or don’t vote at all. The Initial Stockholders have agreed (a) to waive their redemption rights with respect to their Founder Shares, Private Shares and Public Shares held by them in connection with the completion of a Business Combination and (b) not to propose an amendment to the Amended and Restated Certificate of Incorporation that would affect a public stockholders’ ability to convert or sell their shares to the Company in connection with a Business Combination or affect the substance or timing of the Company’s obligation to redeem 100% of its Public Shares if the Company does not complete a Business Combination, unless the Company provides the public stockholders with the opportunity to redeem their Public Shares in conjunction with any such amendment. The Company will have until December 15, 2022 to complete a Business Combination (the “Combination Period”). If the Company is unable to complete a Business Combination within the Combination Period, the Company will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than five The Initial Stockholders have agreed to waive their liquidation rights with respect to the Founder Shares and Private Shares if the Company fails to complete a Business Combination within the Combination Period. However, if the Initial Stockholders acquire Public Shares in or after the Initial Public Offering, such Public Shares will be entitled to liquidating distributions from the Trust Account if the Company fails to complete a Business Combination within the Combination Period. In the event of such distribution, it is possible that the per share value of the assets remaining available for distribution will be less than the Initial Public Offering price per Unit ($10.00). In order to protect the amounts held in the Trust Account, the Initial Stockholders have agreed to be liable to the Company if and to the extent any claims by a vendor for services rendered or products sold to the Company, or a prospective target business with which the Company has discussed entering into a transaction agreement, reduce the amount of funds in the Trust Account to below $10.00 per Public Share, except as to any claims by a third party who executed a valid and enforceable agreement with the Company waiving any right, title, interest or claim of any kind they may have in or to any monies held in the Trust Account and except as to any claims under the Company’s indemnity of the underwriters of Initial Public Offering against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the “Securities Act”). Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, the Initial Stockholders will not be responsible to the extent of any liability for such third-party claims. The Company will seek to reduce the possibility that Initial Stockholders will have to indemnify the Trust Account due to claims of creditors by endeavoring to have all vendors, service providers, (except the Company’s independent registered public accounting firm), prospective target businesses or other entities with which the Company does business, execute agreements with the Company waiving any right, title, interest or claim of any kind in or to monies held in the Trust Account. Risks and Uncertainties Management continues to evaluate the impact of the COVID-19 pandemic and has concluded that while it is reasonably possible that the virus could have a negative effect on the Company’s financial position and/or search for a target company, the specific impact is not readily determinable as of the date of the financial statements. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. | NOTE 1 — DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS Roth CH Acquisition II Co. (formerly known as Roth Acquisition I Co.) (the “Company”) was incorporated in Delaware on February 13, 2019. The Company is a blank check company formed for the purpose of entering into a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization or other similar business combination with one or more businesses or entities (the “Business Combination”). The Company is an early stage and emerging growth company and, as such, the Company is subject to all of the risks associated with early stage and emerging growth companies. As of December 31, 2020, the Company had not commenced any operations. All activity for the period from February 13, 2019 (inception) through December 31, 2020 relates to the Company’s formation and the initial public offering (“Initial Public Offering”), which is described below. The Company will not generate any operating revenues until after the completion of a Business Combination, at the earliest. The Company will generate non-operating income in the form of interest income from the proceeds derived from the Initial Public Offering. The registration statement for the Company’s Initial Public Offering was declared effective on December 10, 2020. On December 15, 2020, the Company consummated the Initial Public Offering of 11,500,000 units (the “Units” and, with respect to the shares of common stock included in the Units sold, the “Public Shares”), which includes the full exercise by the underwriters of their over-allotment option in the amount of 1,500,000 Units, at $10.00 per Unit, generating gross proceeds of $115,000,000, which is described in Note 3. Simultaneously with the closing of the Initial Public Offering, the Company consummated the sale of 275,000 units (the “Private Units”) at a price of $10.00 per Private Unit in a private placement to certain of the Company’s stockholders, generating gross proceeds of $2,750,000, which is described in Note 4. Transaction costs amounted to $1,654,977 consisting of $1,150,000 of underwriting fees, and $504,977 of other offering costs. Following the closing of the Initial Public Offering on December 15, 2020, an amount of $115,000,000 ($10.00 per Unit) from the net proceeds of the sale of the Units in the Initial Public Offering and the sale of the Private Units was placed in a trust account (the “Trust Account”), located in the United States and will be held in cash items or invested in U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act, with a maturity of 185 days or less or in any open-ended investment company that holds itself out as a money market fund selected by the Company meeting the conditions of Rule 2a-7 of the Investment Company Act of 1940, as amended (the “Investment Company Act”), as determined by the Company, until the earlier of: (i) the completion of a Business Combination and (ii) the distribution of the Trust Account, as described below. The Company’s management has broad discretion with respect to the specific application of the net proceeds of the Initial Public Offering and the sale of the Private Units, although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination. There is no assurance that the Company will be able to complete a Business Combination successfully. The Company must complete a Business Combination having an aggregate fair market value of at least 80% of the assets held in the Trust Account (excluding taxes payable on income earned on the Trust Account) at the time of the agreement to enter into an initial Business Combination. The Company will only complete a Business Combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. The Company will provide its holders of the outstanding Public Shares (the “public stockholders”) with the opportunity to redeem all or a portion of their Public Shares upon the completion of a Business Combination either (i) in connection with a stockholder meeting called to approve the Business Combination or (ii) by means of a tender offer. The decision as to whether the Company will seek stockholder approval of a Business Combination or conduct a tender offer will be made by the Company, solely in its discretion. The public stockholders will be entitled to redeem their Public Shares for a pro rata portion of the amount then in the Trust Account (initially anticipated to be $10.00 per Public Share, plus any pro rata interest earned on the funds held in the Trust Account and not previously released to the Company to pay its tax obligations). There will be no redemption rights upon the completion of a Business Combination with respect to the Company’s warrants. The Company will proceed with a Business Combination if the Company has net tangible assets of at least $5,000,001 either immediately prior to or upon such consummation of a Business Combination and, if the Company seeks stockholder approval, a majority of the shares voted are voted in favor of the Business Combination. If a stockholder vote is not required by law and the Company does not decide to hold a stockholder vote for business or other legal reasons, the Company will, pursuant to its Amended and Restated Certificate of Incorporation (the “Amended and Restated Certificate of Incorporation”), conduct the redemptions pursuant to the tender offer rules of the U.S. Securities and Exchange Commission (“SEC”) and file tender offer documents with the SEC containing substantially the same information as would be included in a proxy statement prior to completing a Business Combination. If, however, stockholder approval of the transaction is required by law, or the Company decides to obtain stockholder approval for business or legal reasons, the Company will offer to redeem shares in conjunction with a proxy solicitation pursuant to the proxy rules and not pursuant to the tender offer rules. If the Company seeks stockholder approval in connection with a Business Combination, the holders of the Company’s shares prior to the Initial Public Offering (the “Initial Stockholders”) have agreed to vote their Founder Shares (as defined in Note 5), Private Shares (as defined in Note 4) and any Public Shares purchased during or after the Initial Public Offering (a) in favor of approving a Business Combination and (b) not to redeem any shares in connection with a stockholder vote to approve a Business Combination or sell any shares to the Company in a tender offer in connection with a Business Combination. Additionally, each public stockholder may elect to redeem their Public Shares irrespective of how or whether they vote on the proposed transaction or don’t vote at all. The Initial Stockholders have agreed (a) to waive their redemption rights with respect to their Founder Shares, Private Shares and Public Shares held by them in connection with the completion of a Business Combination and (b) not to propose an amendment to the Amended and Restated Certificate of Incorporation that would affect a public stockholders’ ability to convert or sell their shares to the Company in connection with a Business Combination or affect the substance or timing of the Company’s obligation to redeem 100% of its Public Shares if the Company does not complete a Business Combination, unless the Company provides the public stockholders with the opportunity to redeem their Public Shares in conjunction with any such amendment. The Company will have until December 15, 2022 to complete a Business Combination (the “Combination Period”). If the Company is unable to complete a Business Combination within the Combination Period, the Company will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than five The Initial Stockholders have agreed to waive their liquidation rights with respect to the Founder Shares and Private Shares if the Company fails to complete a Business Combination within the Combination Period. However, if the Initial Stockholders acquire Public Shares in or after the Initial Public Offering, such Public Shares will be entitled to liquidating distributions from the Trust Account if the Company fails to complete a Business Combination within the Combination Period. In the event of such distribution, it is possible that the per share value of the assets remaining available for distribution will be less than the Initial Public Offering price per Unit ($10.00). In order to protect the amounts held in the Trust Account, the Initial Stockholders have agreed to be liable to the Company if and to the extent any claims by a vendor for services rendered or products sold to the Company, or a prospective target business with which the Company has discussed entering into a transaction agreement, reduce the amount of funds in the Trust Account to below $10.00 per Public Share, except as to any claims by a third party who executed a valid and enforceable agreement with the Company waiving any right, title, interest or claim of any kind they may have in or to any monies held in the Trust Account and except as to any claims under the Company’s indemnity of the underwriters of Initial Public Offering against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the “Securities Act”). Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, the Initial Stockholders will not be responsible to the extent of any liability for such third-party claims. The Company will seek to reduce the possibility that Initial Stockholders will have to indemnify the Trust Account due to claims of creditors by endeavoring to have all vendors, service providers, (except the Company’s independent registered public accounting firm), prospective target businesses or other entities with which the Company does business, execute agreements with the Company waiving any right, title, interest or claim of any kind in or to monies held in the Trust Account. Risks and Uncertainties Management continues to evaluate the impact of the COVID-19 pandemic and has concluded that while it is reasonably possible that the virus could have a negative effect on the Company’s financial position and/or search for a target company, the specific impact is not readily determinable as of the date of the financial statements. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X of the Securities and Exchange Commission (the “SEC”). Certain information or footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows. In the opinion of management, the accompanying unaudited condensed financial statements include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented. The accompanying unaudited condensed financial statements should be read in conjunction with the Company’s Annual report on Form 10-K, as filed with the SEC on March 29, 2021. The interim results for the three months ended March 31, 2021 are not necessarily indicative of the results to be expected for the period ending December 31, 2021 or for any future periods. Emerging Growth Company The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used. Use of Estimates The preparation of financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates. Cash and Cash Equivalents The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The Company did not have any cash equivalents as of March 31, 2021 and 2020. Marketable Securities Held in Trust Account December 31, 2020 substantially all of the assets held in the Trust Account were held in U.S. Treasury Bills. Common Stock Subject to Possible Redemption The Company accounts for its common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Common stock subject to mandatory redemption is classified as a liability instrument and is measured at fair value. Conditionally redeemable common stock (including common stock that features redemption rights that is either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) is classified as temporary equity. At all other times, common stock is classified as stockholders’ equity. The Company’s common stock features certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, at December 31, 2020, common stock subject to possible redemption is presented at redemption value as temporary equity, outside of the stockholders’ equity section of the Company’s balance sheets. Warrant Liability The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 480, Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own ordinary shares, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding. For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded at their initial fair value on the date of issuance, and each balance sheet date thereafter. Changes in the estimated fair value of the warrants are recognized as a non-cash gain or loss on the statements of operations. The fair value of the warrants was estimated using a Binomial Lattice Model (see Note 9). Income Taxes The Company follows the asset and liability method of accounting for income taxes under ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of March 31, 2021 and December 31, 2020. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company is subject to income tax examinations by major taxing authorities since inception. The effective tax rate differs from the statutory tax rate of 21% for the three months ended March 31, 2021 and 2020, due to the valuation allowance recorded on the Company’s net operating losses. Net income (Loss) per Common Share Net income (loss) per share is computed by dividing net income (loss) by the weighted-average number of shares of common stock outstanding during the period, excluding shares of common stock subject to forfeiture. The Company has not considered the effect of the warrants sold in the Initial Public Offering and private placement to purchase an aggregate of 5,887,500 shares in the calculation of diluted loss per share, since the exercise of the warrants are contingent upon the occurrence of future events. The Company’s statement of operations includes a presentation of income (loss) per share for common shares subject to possible redemption in a manner similar to the two-class method of income (loss) per share. Net income (loss) per common share, basic and diluted, for Common stock subject to possible redemption is calculated by dividing the proportionate share of income or loss on marketable securities held by the Trust Account, net of applicable franchise and income taxes, by the weighted average number of Common stock subject to possible redemption outstanding since original issuance. Net income (loss) per share, basic and diluted, for non-redeemable common stock is calculated by dividing the net income (loss), adjusted for income or loss on marketable securities attributable to Common stock subject to possible redemption, by the weighted average number of non-redeemable common stock outstanding for the period. Non-redeemable common stock includes Founder Shares and non-redeemable shares of common stock as these shares do not have any redemption features. Non-redeemable common stock participates in the income or loss on marketable securities based on non-redeemable shares’ proportionate interest. The following table reflects the calculation of basic and diluted net income (loss) per common share (in dollars, except per share amounts): Three Months Three Months Ended Ended March 31, March 31, 2021 2020 Common stock subject to possible redemption Numerator: Earnings allocable to Common stock subject to possible redemption Interest earned on marketable securities held in Trust Account $ 5,973 $ — Unrealized gain on marketable securities held in Trust Account — — Less: interest available to be withdrawn for payment of taxes (5,973) — Net income $ — $ — Denominator: Weighted Average Common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Common stock subject to possible redemption 11,088,616 — Basic and diluted net income per share, Common stock subject to possible redemption $ 0.00 $ — Non-Redeemable Common Stock Numerator: Net Loss minus Net Earnings Net loss $ (247,531) $ (85) Net income allocable to Common stock subject to possible redemption — — Non-Redeemable Net Loss $ (247,531) $ (85) Denominator: Weighted Average Non-redeemable common stock — — Basic and diluted weighted average shares outstanding, Non-redeemable common stock 3,561,384 2,500,000 Basic and diluted net loss per share, Non-redeemable common stock $ (0.07) $ (0.00) Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash accounts in a financial institution, which, at times may exceed the Federal Depository Insurance Coverage of $250,000. The Company has not experienced losses on these accounts. Fair Value of Financial Instruments The fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC Topic 820, “Fair Value Measurement,” approximates the carrying amounts represented in the accompanying condensed balance sheets, primarily due to their short-term nature. Fair Value Measurements Fair value is defined as the price that would be received for sale of an asset or paid for transfer of a liability, in an orderly transaction between market participants at the measurement date. GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). These tiers include: ● Level 1, defined as observable inputs such as quoted prices (unadjusted) for identical instruments in active markets; ● Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and ● Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. In some circumstances, the inputs used to measure fair value might be categorized within different levels of the fair value hierarchy. In those instances, the fair value measurement is categorized in its entirety in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement. Derivative Financial Instruments The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives in accordance with ASC Topic 815, “Derivatives and Hedging”. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value on the grant date and is then re-valued at each reporting date, with changes in the fair value reported in the statements of operations. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement or conversion of the instrument could be required within 12 months of the balance sheet date. Recent Accounting Standards Management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s condensed financial statements. | NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying financial statements are presented in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the SEC. Emerging Growth Company The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used. Use of Estimates The preparation of financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates. Cash and Cash Equivalents The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The Company did not have any cash equivalents as of December 31, 2020 and 2019. Marketable Securities Held in Trust Account December 31, 2020 substantially all of the assets held in the Trust Account were held in U.S. Treasury Bills. Common Stock Subject to Possible Redemption The Company accounts for its common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Common stock subject to mandatory redemption is classified as a liability instrument and is measured at fair value. Conditionally redeemable common stock (including common stock that features redemption rights that is either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) is classified as temporary equity. At all other times, common stock is classified as stockholders’ equity. The Company’s common stock features certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, at December 31, 2020, common stock subject to possible redemption is presented at redemption value as temporary equity, outside of the stockholders’ equity section of the Company’s balance sheets. Income Taxes The Company follows the asset and liability method of accounting for income taxes under ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of December 31, 2020 and 2019. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company is subject to income tax examinations by major taxing authorities since inception. On March 27, 2020, the CARES Act was enacted in response to COVID-19 pandemic. Under ASC 740, the effects of changes in tax rates and laws are recognized in the period which the new legislation is enacted. The CARES Act made various tax law changes including among other things (i) increasing the limitation under Section 163(j) of the Internal Revenue Code of 1986, as amended (the “IRC”) for 2019 and 2020 to permit additional expensing of interest (ii) enacting a technical correction so that qualified improvement property can be immediately expensed under IRC Section 168(k), (iii) making modifications to the federal net operating loss rules including permitting federal net operating losses incurred in 2018, 2019, and 2020 to be carried back to the five preceding taxable years in order to generate a refund of previously paid income taxes and (iv) enhancing the recoverability of alternative minimum tax credits. Given the Company’s full valuation allowance position and capitalization of all costs, the CARES Act did not have an impact on the financial statements. Net Income (Loss) per Common Share Net income (loss) per share is computed by dividing net income (loss) by the weighted-average number of shares of common stock outstanding during the period, excluding shares of common stock subject to forfeiture. At December 31, 2019, weighted average shares were reduced for the effect of an aggregate of 375,000 shares of common stock that were subject to forfeiture if the over-allotment option was not exercised by the underwriters (see Note 7). The Company has not considered the effect of the warrants sold in the Initial Public Offering and private placement to purchase an aggregate of 5,887,500 shares in the calculation of diluted loss per share, since the exercise of the warrants are contingent upon the occurrence of future events. The Company’s statement of operations includes a presentation of income (loss) per share for common shares subject to possible redemption in a manner similar to the two-class method of income (loss) per share. Net income (loss) per common share, basic and diluted, for Common stock subject to possible redemption is calculated by dividing the proportionate share of income or loss on marketable securities held by the Trust Account, net of applicable franchise and income taxes, by the weighted average number of Common stock subject to possible redemption outstanding since original issuance. Net income (loss) per share, basic and diluted, for non-redeemable common stock is calculated by dividing the net income (loss), adjusted for income or loss on marketable securities attributable to Common stock subject to possible redemption, by the weighted average number of non-redeemable common stock outstanding for the period. Non-redeemable common stock includes Founder Shares and non-redeemable shares of common stock as these shares do not have any redemption features. Non-redeemable common stock participates in the income or loss on marketable securities based on non-redeemable shares’ proportionate interest. The following table reflects the calculation of basic and diluted net income (loss) per common share (in dollars, except per share amounts): For the Period from February 13, 2019 Year Ended (inception) December 31, through 2020 December 31, 2019 Common stock subject to possible redemption Numerator: Earnings allocable to Common stock subject to possible redemption Interest earned on marketable securities held in Trust Account $ 5,785 $ — Unrealized gain on marketable securities held in Trust Account 828 — Less: interest available to be withdrawn for payment of taxes (6,613) — Net income $ — $ — Denominator: Weighted Average Common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Common stock subject to possible redemption 11,111,752 — Basic and diluted net income per share, Common stock subject to possible redemption $ 0.00 $ — Non-Redeemable Common Stock Numerator: Net Loss minus Net Earnings Net loss $ (103,385) $ (1,225) Net income allocable to Common stock subject to possible redemption — — Non-Redeemable Net Loss $ (103,385) $ (1,225) Denominator: Weighted Average Non-redeemable common stock Basic and diluted weighted average shares outstanding, Non-redeemable common stock 2,545,512 2,500,000 Basic and diluted net loss per share, Non-redeemable common stock $ (0.04) $ (0.00) Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist of a cash account in a financial institution, which, at times, may exceed the Federal Depository Insurance Coverage of $250,000. The Company has not experienced losses on this account. Fair Value of Financial Instruments The fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC 820, “Fair Value Measurement,” approximates the carrying amounts represented in the accompanying balance sheets, primarily due to their short-term nature. Recent Accounting Standards Management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s financial statements. |
PUBLIC OFFERING
PUBLIC OFFERING | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
PUBLIC OFFERING | ||
PUBLIC OFFERING | NOTE 3. PUBLIC OFFERING Pursuant to the Initial Public Offering, the Company sold 11,500,000 Units, which includes a full exercise by the underwriters of their over-allotment option in the amount of 1,500,000 Units, at a price of $10.00 per Unit. Each Unit consists of one share of common stock and one -half of one redeemable warrant (“Public Warrant”). Each whole Public Warrant entitles the holder to purchase one share of common stock at an exercise price of $11.50 per share, subject to adjustment (see Note 7). | NOTE 3 — PUBLIC OFFERING Pursuant to the Initial Public Offering, the Company sold 11,500,000 Units, which includes a full exercise by the underwriters of their over-allotment option in the amount of 1,500,000 Units, at a price of $10.00 per Unit. Each Unit consists of one share of common stock and one |
PRIVATE PLACEMENT
PRIVATE PLACEMENT | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
PRIVATE PLACEMENT | ||
PRIVATE PLACEMENT | NOTE 4. PRIVATE PLACEMENT Simultaneously with the closing of the Initial Public Offering, the Initial Stockholders purchased an aggregate of 275,000 Private Units at a price of $10.00 per Private Unit, for an aggregate purchase price of $2,750,000, in a private placement. Each Private Unit consists of one share of common stock (“Private Share”) and one -half of one redeemable warrant (“Private Warrant”). Each whole Private Warrant entitles the holder to purchase one share of common stock at a price of $11.50 per full share, subject to adjustment (see Note 7). The proceeds from the Private Units were added to the proceeds from the Initial Public Offering held in the Trust Account. If the Company does not complete a Business Combination within the Combination Period, the proceeds from the sale of the Private Units will be used to fund the redemption of the Public Shares (subject to the requirements of applicable law). | NOTE 4 — PRIVATE PLACEMENT Simultaneously with the closing of the Initial Public Offering, the Initial Stockholders purchased an aggregate of 275,000 Private Units at a price of $10.00 per Private Unit, for an aggregate purchase price of $2,750,000, in a private placement. Each Private Unit consists of one share of common stock (“Private Share”) and one-half of one |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
RELATED PARTY TRANSACTIONS | ||
RELATED PARTY TRANSACTIONS | NOTE 5. RELATED PARTY TRANSACTIONS Founder Shares In February 2019, the Initial Stockholders purchased an aggregate of 100 shares of the Company’s common stock for an aggregate price of $25,000. On June 29, 2020, the Company effected a stock dividend of 43,125 shares of common stock for each share of common stock outstanding, resulting in an aggregate of 4,312,500 shares of common stock being held by the Initial Stockholders. On August 31, 2020, the Initial Stockholders transferred back to the Company 1,437,500 shares of common stock, for nominal consideration, which shares were cancelled, resulting in there being an aggregate of 2,875,000 shares of common stock outstanding and being held by the Initial Stockholders (the “Founder Shares”). That same day, CHLM Sponsor-1 LLC, an entity affiliated with Craig-Hallum Capital Group LLC, and certain of the Company’s directors, officers and affiliates of the Company’s management team purchased from CR Financial Holdings, Inc. an aggregate of 745,840 shares for an aggregate purchase price of $6,486. All share and per-share amounts have been retroactively restated to reflect the stock dividend and cancellation. The Founder’s Shares included an aggregate of up to 375,000 shares subject to forfeiture by the Sponsor to the extent that the underwriters’ over-allotment was not exercised in full or in part, so that the Sponsor would collectively own 20% of the Company’s issued and outstanding shares after the Initial Public Offering (excluding the Private Shares underlying the Private Securities). As a result of the underwriters’ election to fully exercise their over-allotment option, no Founder Shares are currently subject to forfeiture. The Initial Stockholders have agreed, subject to certain limited exceptions, not to transfer, assign or sell any of the Founder Shares until (1) with respect to 50% of the Founder Shares, the earlier of six months after the completion of a Business Combination and the date on which the closing price of the common stock equals or exceeds $12.50 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30 - trading day period commencing after a Business Combination and (2) with respect to the remaining 50% of the Founder Shares, six months after the completion of a Business Combination, or earlier, in either case, if, subsequent to a Business Combination, the Company completes a liquidation, merger, stock exchange or other similar transaction which results in all of the Company’s stockholders having the right to exchange their shares of common stock for cash, securities or other property. Promissory Note — Related Party On August 23, 2020, the Company issued an unsecured promissory note to the sponsor (the “Promissory Note”), pursuant to which the Company may borrow up to an aggregate principal amount of $200,000. The Promissory Note is non-interest bearing and payable on the earlier of (i) the consummation of the Initial Public Offering or (ii) the date on which the Company determines not to proceed with the Initial Public Offering. The outstanding balance under the Promissory Note of $200,000 was repaid at the closing of the Initial Public Offering on December 15, 2020. Related Party Loans In addition, in order to finance transaction costs in connection with a Business Combination, the Initial Stockholders, or certain of the Company’s officers and directors or their affiliates may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). If the Company completes a Business Combination, the Company would repay the Working Capital Loans out of the proceeds of the Trust Account released to the Company. Otherwise, the Working Capital Loans would be repaid only out of funds held outside the Trust Account. In the event that a Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans, but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. Except for the foregoing, the terms of such Working Capital Loans, if any, have not been determined and no written agreements exist with respect to such loans. The Working Capital Loans would be repaid upon consummation of a Business Combination, without interest. | NOTE 5 — RELATED PARTY TRANSACTIONS Founder Shares In February 2019, the Initial Stockholders purchased an aggregate of 100 shares of the Company’s common stock for an aggregate price of $25,000. On June 29, 2020, the Company effected a stock dividend of 43,125 shares of common stock for each share of common stock outstanding, resulting in an aggregate of 4,312,500 shares of common stock being held by the Initial Stockholders. On August 31, 2020, the Initial Stockholders transferred back to the Company 1,437,500 shares of common stock, for nominal consideration, which shares were cancelled, resulting in there being an aggregate of 2,875,000 shares of common stock outstanding and being held by the Initial Stockholders (the “Founder Shares”). That same day, CHLM Sponsor-1 LLC, an entity affiliated with Craig-Hallum Capital Group LLC, and certain of the Company’s directors, officers and affiliates of the Company’s management team purchased from CR Financial Holdings, Inc. an aggregate of 745,840 shares for an aggregate purchase price of $6,486. All share and per-share amounts have been retroactively restated to reflect the stock dividend and cancellation. The Founder’s Shares included an aggregate of up to 375,000 shares subject to forfeiture by the Sponsor to the extent that the underwriters’ over-allotment was not exercised in full or in part, so that the Sponsor would collectively own 20% of the Company’s issued and outstanding shares after the Initial Public Offering (excluding the Private Shares underlying the Private Securities). As a result of the underwriters’ election to fully exercise their over-allotment option, no Founder Shares are currently subject to forfeiture. The Initial Stockholders have agreed, subject to certain limited exceptions, not to transfer, assign or sell any of the Founder Shares until (1) with respect to 50% of the Founder Shares, the earlier of six months after the completion of a Business Combination and the date on which the closing price of the common stock equals or exceeds $12.50 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing after a Business Combination and (2) with respect to the remaining 50% of the Founder Shares, six months after the completion of a Business Combination, or earlier, in either case, if, subsequent to a Business Combination, the Company completes a liquidation, merger, stock exchange or other similar transaction which results in all of the Company’s stockholders having the right to exchange their shares of common stock for cash, securities or other property. Promissory Note — Related Party On August 23, 2020, the Company issued an unsecured promissory note to the sponsor (the “Promissory Note”), pursuant to which the Company may borrow up to an aggregate principal amount of $200,000. The Promissory Note is non-interest bearing and payable on the earlier of (i) the consummation of the Initial Public Offering or (ii) the date on which the Company determines not to proceed with the Initial Public Offering. The outstanding balance under the Promissory Note of $200,000 was repaid at the closing of the Initial Public Offering on December 15, 2020. Related Party Loans In addition, in order to finance transaction costs in connection with a Business Combination, the Initial Stockholders, or certain of the Company’s officers and directors or their affiliates may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). If the Company completes a Business Combination, the Company would repay the Working Capital Loans out of the proceeds of the Trust Account released to the Company. Otherwise, the Working Capital Loans would be repaid only out of funds held outside the Trust Account. In the event that a Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans, but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. Except for the foregoing, the terms of such Working Capital Loans, if any, have not been determined and no written agreements exist with respect to such loans. The Working Capital Loans would be repaid upon consummation of a Business Combination, without interest. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
COMMITMENTS AND CONTINGENCIES | ||
COMMITMENTS AND CONTINGENCIES | NOTE 6. COMMITMENTS AND CONTINGENCIES Registration Rights Pursuant to a registration rights agreement entered into on December 10, 2020, the holders of the Founder Shares, as well as the holders of the Private Units (and underlying securities) and any securities issued to the Initial Stockholders, officers, directors or their affiliates in payment of Working Capital Loans made to Company, will be entitled to registration rights. The holders of a majority of these securities are entitled to make up to two demands that the Company register such securities. The holders of the majority of the Founder Shares can elect to exercise these registration rights at any time commencing three months prior to the date on which these shares of common stock are to be released from escrow. The holders of a majority of the Private Units (and underlying securities) and securities issued in payment of Working Capital Loans (or underlying securities) can elect to exercise these registration rights at any time after the Company consummates a Business Combination. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to consummation of a Business Combination. The registration rights agreement does not contain liquidating damages or other cash settlement provisions resulting from delays in registering the Company’s securities. The Company will bear the expenses incurred in connection with the filing of any such registration statements. Notwithstanding the foregoing, the Company may not exercise demand or piggyback rights after five (5) and seven (7) years, respectively, from the effective date of the Initial Public Offering and may not exercise demand rights on more than one occasion in respect of all registrable securities. Underwriting Agreement The underwriters were paid a cash underwriting discount of 1.00% of the gross proceeds of the Initial Public Offering, or $1,150,000. Business Combination Marketing Agreement The Company entered into a business combination marketing agreement with the representatives of the underwriters as advisors in connection with a Business Combination. The Company will pay the representatives of the underwriters a marketing fee for such services upon the consummation of a Business Combination in an amount equal to, in the aggregate, 4.5% of the gross proceeds of the Initial Public Offering, including any proceeds from the full or partial exercise of the underwriters’ over-allotment option. As a result, the representatives of the underwriters will not be entitled to such fee unless the Company consummates its initial business combination. | NOTE 6 — COMMITMENTS AND CONTINGENCIES Registration Rights Pursuant to a registration rights agreement entered into on December 10, 2020, the holders of the Founder Shares, as well as the holders of the Private Units (and underlying securities) and any securities issued to the Initial Stockholders, officers, directors or their affiliates in payment of Working Capital Loans made to Company, will be entitled to registration rights. The holders of a majority of these securities are entitled to make up to two demands that the Company register such securities. The holders of the majority of the Founder Shares can elect to exercise these registration rights at any time commencing three months prior to the date on which these shares of common stock are to be released from escrow. The holders of a majority of the Private Units (and underlying securities) and securities issued in payment of Working Capital Loans (or underlying securities) can elect to exercise these registration rights at any time after the Company consummates a Business Combination. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to consummation of a Business Combination. The registration rights agreement does not contain liquidating damages or other cash settlement provisions resulting from delays in registering the Company’s securities. The Company will bear the expenses incurred in connection with the filing of any such registration statements. Notwithstanding the foregoing, the Company may not exercise demand or piggyback rights after five (5) and seven (7) years, respectively, from the effective date of the Initial Public Offering and may not exercise demand rights on more than one occasion in respect of all registrable securities. Underwriting Agreement The underwriters were paid a cash underwriting discount of 1.00% of the gross proceeds of the Initial Public Offering, or $1,150,000. Business Combination Marketing Agreement The Company entered into a business combination marketing agreement with the representatives of the underwriters as advisors in connection with a Business Combination. The Company will pay the representatives of the underwriters a marketing fee for such services upon the consummation of a Business Combination in an amount equal to, in the aggregate, 4.5% of the gross proceeds of the Initial Public Offering, including any proceeds from the full or partial exercise of the underwriters’ over-allotment option. As a result, the representatives of the underwriters will not be entitled to such fee unless the Company consummates its initial business combination. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
STOCKHOLDERS' EQUITY | ||
STOCKHOLDERS' EQUITY | NOTE 7 — STOCKHOLDERS’ EQUITY Common Stock — issued outstanding | NOTE 7 — STOCKHOLDERS’ EQUITY Common Stock issued outstanding Warrants effective registration statement and during any period when the Company shall have failed to maintain an effective registration statement, exercise warrants on a cashless basis pursuant to an available exemption from registration under the Securities Act. The warrants will expire five years from the closing of a Business Combination. Once the warrants become exercisable, the Company may redeem the Public Warrants: ● in whole and not in part; ● at a price of $ 0.01 per warrant; ● at any time after the warrants become exercisable; ● upon not less than 30 days ’ prior written notice of redemption to each warrant holder; ● if, and only if, the reported last sale price of the shares of common stock equals or exceeds $ 18.00 per share, for any 20 trading days within a 30 - day trading period commencing after the warrants become exercisable and ending on the third business day prior to the notice of redemption to warrant holders; and ● if, and only if, there is a current registration statement in effect with respect to the shares of common stock underlying such warrants at the time of redemption and for the entire 30-day trading period referred to above and continuing each day thereafter until the date of redemption. If the Company calls the Public Warrants for redemption, management will have the option to require all holders that wish to exercise the Public Warrants to do so on a “cashless basis,” as described in the warrant agreement. The exercise price and number of shares of common stock issuable on exercise of the warrants may be adjusted in certain circumstances including in the event of a stock dividend, extraordinary dividend or our recapitalization, reorganization, merger or consolidation. However, except as described below, the warrants will not be adjusted for issuances of shares of common stock at a price below their respective exercise prices. Additionally, in no event will the Company be required to net cash settle the warrants. If the Company is unable to complete a Business Combination within the Combination Period and the Company liquidates the funds held in the Trust Account, holders of warrants will not receive any of such funds with respect to their warrants, nor will they receive any distribution from the Company’s assets held outside of the Trust Account with the respect to such warrants. Accordingly, the warrants may expire worthless. In addition, if (x) the Company issues additional shares of common stock or equity-linked securities for capital raising purposes in connection with the closing of a Business Combination at an issue price or effective issue price of less than $9.20 per share of common stock (with such issue price or effective issue price to be determined in good faith by the Company’s board of directors, and in the case of any such issuance to the Initial Stockholders or their affiliates, without taking into account any Founder Shares held by them prior to such issuance), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of a Business Combination on the date of the consummation of a Business Combination (net of redemptions), and (z) the volume weighted average trading price of the Company’s common stock during the 20 trading day period starting on the trading day prior to the day on which the Company consummates Business Combination (such price, the “Market Value”) is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the Market Value and the $18.00 per share redemption trigger price described above will be adjusted (to the nearest cent) to be equal to 180% of the Market Price. The Private Warrants are identical to the Public Warrants underlying the Units sold in the Initial Public Offering, except that the Private Warrants and the shares of common stock issuable upon the exercise of the Private Warrants will not be transferable, assignable or saleable until after the completion of a Business Combination, subject to certain limited exceptions. Additionally, the Private Warrants will be exercisable for cash or on a cashless basis, at the holder’s option, and be non-redeemable so long as they are held by the initial purchasers or their permitted transferees. If the Private Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants. |
WARRANTS
WARRANTS | 3 Months Ended |
Mar. 31, 2021 | |
WARRANTS | |
WARRANTS | NOTE 8 — WARRANTS Warrants — Once the warrants become exercisable, the Company may redeem the Public Warrants: ● in whole and not in part; ● at a price of $0.01 per warrant; ● at any time after the warrants become exercisable; ● upon not less than 30 days ' prior written notice of redemption to each warrant holder; ● if, and only if, the reported last sale price of the shares of common stock equals or exceeds $18.00 per share, for any 20 trading days within a 30 - day trading period commencing after the warrants become exercisable and ending on the third business day prior to the notice of redemption to warrant holders; and ● if, and only if, there is a current registration statement in effect with respect to the shares of common stock underlying such warrants at the time of redemption and for the entire 30 -day trading period referred to above and continuing each day thereafter until the date of redemption. If the Company calls the Public Warrants for redemption, management will have the option to require all holders that wish to exercise the Public Warrants to do so on a “cashless basis,” as described in the warrant agreement. The exercise price and number of shares of common stock issuable on exercise of the warrants may be adjusted in certain circumstances including in the event of a stock dividend, extraordinary dividend or our recapitalization, reorganization, merger or consolidation. However, except as described below, the warrants will not be adjusted for issuances of shares of common stock at a price below their respective exercise prices. Additionally, in no event will the Company be required to net cash settle the warrants. If the Company is unable to complete a Business Combination within the Combination Period and the Company liquidates the funds held in the Trust Account, holders of warrants will not receive any of such funds with respect to their warrants, nor will they receive any distribution from the Company’s assets held outside of the Trust Account with the respect to such warrants. Accordingly, the warrants may expire worthless. In addition, if (x) the Company issues additional shares of common stock or equity-linked securities for capital raising purposes in connection with the closing of a Business Combination at an issue price or effective issue price of less than $9.20 per share of common stock (with such issue price or effective issue price to be determined in good faith by the Company’s board of directors, and in the case of any such issuance to the Initial Stockholders or their affiliates, without taking into account any Founder Shares held by them prior to such issuance), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of a Business Combination on the date of the consummation of a Business Combination (net of redemptions), and (z) the volume weighted average trading price of the Company’s common stock during the 20 trading day period starting on the trading day prior to the day on which the Company consummates Business Combination (such price, the “Market Value”) is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the Market Value and the $18.00 per share redemption trigger price described above will be adjusted (to the nearest cent) to be equal to 180% of the Market Price. The Private Warrants are identical to the Public Warrants underlying the Units sold in the Initial Public Offering, except that the Private Warrants and the shares of common stock issuable upon the exercise of the Private Warrants will not be transferable, assignable or saleable until after the completion of a Business Combination, subject to certain limited exceptions. Additionally, the Private Warrants will be exercisable for cash or on a cashless basis, at the holder’s option, and be non-redeemable so long as they are held by the initial purchasers or their permitted transferees. If the Private Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
FAIR VALUE MEASUREMENTS | ||
FAIR VALUE MEASUREMENTS | NOTE 9. FAIR VALUE MEASUREMENTS The Company follows the guidane in ASC 820 for its financial assets and liabilities that are re-measured and reported at fair value at each reporting period, and non-financial assets and liabilities that are re-measured and reported at fair value at least annually. The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities: Level 1: Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2: Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active. Level 3: Unobservable inputs based on our assessment of the assumptions that market participants would use in pricing the asset or liability. The following table presents information about the Company’s assets that are measured at fair value on a recurring basis at March 31, 2021, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value: March 31, December 31, Description Level 2021 2020 Assets: Marketable securities held in Trust Account 1 $ 115,012,821 $ 115,006,613 Liabilities Warrant liabilities – Private Placement Warrants 3 $ 178,750 $ 129,250 The Warrants were accounted for as liabilities in accordance with ASC 815-40 and are presented within warrant liabilities on our accompanying March 31, 2021 condensed balance sheet. The warrant liabilities are measured at fair value at inception and on a recurring basis, with changes in fair value presented within change in fair value of warrant liabilities in the condensed statement of operations. The Warrants were valued using a binomial lattice model incorporating the Cox-Ross-Rubenstein methodology, which is considered to be a Level 3 fair value measurement. The binomial lattice model’s primary unobservable input utilized in determining the fair value of the Warrants is the expected volatility of the common stock. The expected volatility as of the IPO date was derived from observable public warrant pricing on comparable ‘blank-check’ companies without an identified target. The expected volatility as of subsequent valuation dates was implied from the Company’s own public warrant pricing. There were no transfers between The following table provides quantitative information regarding Level 3 fair value measurements: At As of December 31, March 31, 2020 2021 Stock price $ 9.54 $ 9.91 Strike price $ 11.50 $ 11.50 Volatility 17.5% 19.1% Risk-free rate 0.41% 0.94% Probability of Business Combination occurring 75% 75% Dividend yield 0.0% 0.0% Fair value of warrants $ 0.94 $ 1.30 The following table presents the changes in the fair value of warrant liabilities: Warrant Liabilities Fair value as of December 31, 2020 $ 129,250 Change in valuation inputs or other assumptions 49,500 Fair value as of March 31, 2021 178,750 | NOTE 9 — FAIR VALUE MEASUREMENTS The Company follows the guidance in ASC 820 for its financial assets and liabilities that are re-measured and reported at fair value at each reporting period, and non-financial assets and liabilities that are re-measured and reported at fair value at least annually. The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities: Level 1: Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2: Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active. Level 3: Unobservable inputs based on our assessment of the assumptions that market participants would use in pricing the asset or liability. The following table presents information about the Company’s assets that are measured at fair value on a recurring basis at December 31, 2020, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value: December 31, Description Level 2020 Assets: Cash and marketable securities held in Trust Account 1 $ 115,006,613 |
Revision to Prior Period Financ
Revision to Prior Period Financial Statements Footnote | 3 Months Ended |
Mar. 31, 2021 | |
Revision to Prior Period Financial Statements Footnote | |
Revision to Prior Period Financial Statements Footnote | NOTE 10. Revision to Prior Period Financial Statements Footnote During the course of preparing the quarterly report on Form 10-Q for the three-month period ended March 31, 2021, the Company identified a misstatement in its misapplication of accounting guidance related to the Company’s warrants in the Company’s previously issued audited balance sheet dated December 15, 2020, filed on Form 8-K on December 21, 2020 (the “Post-IPO Balance Sheet”) and its Annual Report, filed on Form 10-K on March 29, 2021. On April 12, 2021, the staff of the Securities and Exchange Commission (the “SEC Staff”) issued a public statement entitled “Staff Statement on Accounting and Reporting Considerations for Warrants issued by Special Purpose Acquisition Companies (“SPACs”)” (the “SEC Staff Statement”). In the SEC Staff Statement, the SEC Staff expressed its view that certain terms and conditions common to SPAC warrants may require the warrants to be classified as liabilities on the SPAC’s balance sheet as opposed to equity. Since their issuance on December 15, 2020, the Company’s Private Placement warrants have been accounted for as equity within the Company’s previously reported balance sheets. After discussion and evaluation, including with the Company’s independent registered public accounting firm and the Company’s audit committee, management concluded that the Private Placement warrants should be presented as liabilities with subsequent fair value remeasurement. The Private Placement warrants were reflected as a component of equity in the Post-IPO Balance Sheet as opposed to liabilities on the balance sheet, based on the Company’s application of Financial Accounting Standards Board ASC Topic 815-40, Derivatives and Hedging, Contracts in Entity’s Own Equity The Company concluded that the misstatement was not material to the Post-IPO Balance Sheet or the Annual Report for the year ended December 31, 2020, and the misstatement had no material impact to any prior interim period. The effect of the revisions to the Post-IPO Balance Sheet and its Annual Report for the year ended December 31, 2020 is as follows: As Previously As Reported Adjustments Revised Balance sheet as of December 15, 2020 (audited) Warrant Liabilities $ — $ 111,375 $ 111,375 Common Stock Subject to Possible Redemption 111,117,520 (111,375) 111,006,145 Common Stock 355 1 356 Additional Paid-in Capital 5,002,148 477 5,002,625 Accumulated Deficit (2,500) (478) (2,978) Balance sheet as of December 31, 2020 (audited) Warrant Liabilities $ — $ 129,250 $ 129,250 Common Stock Subject to Possible Redemption 111,015,410 (129,250) 110,886,160 Common Stock 355 2 357 Additional Paid-in Capital 5,104,258 18,351 5,122,609 Accumulated Deficit (104,610) (18,353) (122,963) Year ended December 31, 2020 (audited) Change in fair value of warrant liabilities $ — $ (17,875) $ (17,875) Initial public offering costs allocated to warrant liabilities — (478) (478) Net loss (103,385) (18,353) (121,738) Cash Flow Statement for the Year ended December 31, 2020 (audited) Net loss $ (103,385) $ (18,353) $ (121,738) Change in fair value of warrant liabilities — 17,875 17,875 Initial public offering costs allocated to warrant liabilities — 478 478 Initial classification of warrant liabilities — 111,375 111,375 Initial classification of common stock subject to possible redemption 111,117,520 (111,375) 111,006,145 Change in value of common stock subject to possible redemption (102,110) (17,875) (119,985) Statement of Changes in Stockholders’ Equity for the Year ended December 31, 2020 (audited) Sale of 275,000 private units $ 2,750,000 $ (111,375) $ 2,638,625 Common stock Subject to Possible Redemption 111,015,410 (129,250) 110,886,160 Net Loss (103,385) (18,353) (121,738) |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
SUBSEQUENT EVENTS | ||
SUBSEQUENT EVENTS | NOTE 11. SUBSEQUENT EVENTS The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the condensed financial statements were issued. Based upon this review, other than as described in Note 9 and below, the Company did not identify any subsequent events that would have required adjustment or disclosure in the condensed financial statements. On April 14, 2021, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Roth CH II Merger SubCorp. (“Merger Sub”) and Reservoir Holdings, Inc. (“Reservoir”). Pursuant to the terms of the Merger Agreement, the business combination (the “Business Combination”) between the Company and Reservoir will be effected through the merger of Merger Sub with and into Reservoir (the “Merger”), with Reservoir surviving the Merger as a wholly owned subsidiary of the Company. The Business Combination is subject to customary conditions to closing, including receipt of approval of the Company’s stockholders and the concurrent closing of a $150 million private placement of the Company’s common stock to certain institutional and accredited investors. There can be no assurance that such conditions will be satisfied or that the Business Combination will be consummated on the terms contemplated by the Merger Agreement. | NOTE 10 — SUBSEQUENT EVENTS The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the financial statements were issued. Based upon this review, other than as described below, the Company did not identify any subsequent events that would have required adjustment or disclosure in the financial statements. On February 15, 2021, the Company entered into a mutually exclusive non-binding letter of intent (the “Letter of Intent”) with a target company (“Target Company”) for a potential business combination which would qualify as its initial business combination (the “Business Combination”). Under the terms of the Letter of Intent, the Company and Target Company intend to enter into a definitive agreement pursuant to which the Company and Target Company would combine, with the former equity holders of both entities (following the completion of the Business Combination) holding equity in the combined publicly listed company. The completion of the Business Combination is subject to the completion of due diligence to the Company’s satisfaction, the negotiation and execution of definitive documentation and satisfaction of the conditions contained therein, including (i) completion of any required stock exchange and regulatory review and (ii) approval of the transaction by the Company’s stockholders and the Target Company’s stockholders. Accordingly, no assurances can be made by either party that the parties will successfully negotiate and enter into a definitive agreement, or that the proposed transaction will be consummated. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X of the Securities and Exchange Commission (the “SEC”). Certain information or footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows. In the opinion of management, the accompanying unaudited condensed financial statements include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented. The accompanying unaudited condensed financial statements should be read in conjunction with the Company’s Annual report on Form 10-K, as filed with the SEC on March 29, 2021. The interim results for the three months ended March 31, 2021 are not necessarily indicative of the results to be expected for the period ending December 31, 2021 or for any future periods. | Basis of Presentation The accompanying financial statements are presented in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the SEC. |
Emerging Growth Company | Emerging Growth Company The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used. | Emerging Growth Company The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates. | Use of Estimates The preparation of financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The Company did not have any cash equivalents as of March 31, 2021 and 2020. | Cash and Cash Equivalents The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The Company did not have any cash equivalents as of December 31, 2020 and 2019. |
Marketable Securities Held in Trust Account | Marketable Securities Held in Trust Account December 31, 2020 substantially all of the assets held in the Trust Account were held in U.S. Treasury Bills. | Marketable Securities Held in Trust Account December 31, 2020 substantially all of the assets held in the Trust Account were held in U.S. Treasury Bills. |
Common Stock Subject to Possible Redemption | Common Stock Subject to Possible Redemption The Company accounts for its common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Common stock subject to mandatory redemption is classified as a liability instrument and is measured at fair value. Conditionally redeemable common stock (including common stock that features redemption rights that is either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) is classified as temporary equity. At all other times, common stock is classified as stockholders’ equity. The Company’s common stock features certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, at December 31, 2020, common stock subject to possible redemption is presented at redemption value as temporary equity, outside of the stockholders’ equity section of the Company’s balance sheets. | Common Stock Subject to Possible Redemption The Company accounts for its common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Common stock subject to mandatory redemption is classified as a liability instrument and is measured at fair value. Conditionally redeemable common stock (including common stock that features redemption rights that is either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) is classified as temporary equity. At all other times, common stock is classified as stockholders’ equity. The Company’s common stock features certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, at December 31, 2020, common stock subject to possible redemption is presented at redemption value as temporary equity, outside of the stockholders’ equity section of the Company’s balance sheets. |
Warrant Liability | Warrant Liability The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 480, Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own ordinary shares, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding. For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded at their initial fair value on the date of issuance, and each balance sheet date thereafter. Changes in the estimated fair value of the warrants are recognized as a non-cash gain or loss on the statements of operations. The fair value of the warrants was estimated using a Binomial Lattice Model (see Note 9). | |
Income Taxes | Income Taxes The Company follows the asset and liability method of accounting for income taxes under ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of March 31, 2021 and December 31, 2020. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company is subject to income tax examinations by major taxing authorities since inception. The effective tax rate differs from the statutory tax rate of 21% for the three months ended March 31, 2021 and 2020, due to the valuation allowance recorded on the Company’s net operating losses. | Income Taxes The Company follows the asset and liability method of accounting for income taxes under ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of December 31, 2020 and 2019. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company is subject to income tax examinations by major taxing authorities since inception. On March 27, 2020, the CARES Act was enacted in response to COVID-19 pandemic. Under ASC 740, the effects of changes in tax rates and laws are recognized in the period which the new legislation is enacted. The CARES Act made various tax law changes including among other things (i) increasing the limitation under Section 163(j) of the Internal Revenue Code of 1986, as amended (the “IRC”) for 2019 and 2020 to permit additional expensing of interest (ii) enacting a technical correction so that qualified improvement property can be immediately expensed under IRC Section 168(k), (iii) making modifications to the federal net operating loss rules including permitting federal net operating losses incurred in 2018, 2019, and 2020 to be carried back to the five preceding taxable years in order to generate a refund of previously paid income taxes and (iv) enhancing the recoverability of alternative minimum tax credits. Given the Company’s full valuation allowance position and capitalization of all costs, the CARES Act did not have an impact on the financial statements. |
Net income (Loss) per Common Share | Net income (Loss) per Common Share Net income (loss) per share is computed by dividing net income (loss) by the weighted-average number of shares of common stock outstanding during the period, excluding shares of common stock subject to forfeiture. The Company has not considered the effect of the warrants sold in the Initial Public Offering and private placement to purchase an aggregate of 5,887,500 shares in the calculation of diluted loss per share, since the exercise of the warrants are contingent upon the occurrence of future events. The Company’s statement of operations includes a presentation of income (loss) per share for common shares subject to possible redemption in a manner similar to the two-class method of income (loss) per share. Net income (loss) per common share, basic and diluted, for Common stock subject to possible redemption is calculated by dividing the proportionate share of income or loss on marketable securities held by the Trust Account, net of applicable franchise and income taxes, by the weighted average number of Common stock subject to possible redemption outstanding since original issuance. Net income (loss) per share, basic and diluted, for non-redeemable common stock is calculated by dividing the net income (loss), adjusted for income or loss on marketable securities attributable to Common stock subject to possible redemption, by the weighted average number of non-redeemable common stock outstanding for the period. Non-redeemable common stock includes Founder Shares and non-redeemable shares of common stock as these shares do not have any redemption features. Non-redeemable common stock participates in the income or loss on marketable securities based on non-redeemable shares’ proportionate interest. The following table reflects the calculation of basic and diluted net income (loss) per common share (in dollars, except per share amounts): Three Months Three Months Ended Ended March 31, March 31, 2021 2020 Common stock subject to possible redemption Numerator: Earnings allocable to Common stock subject to possible redemption Interest earned on marketable securities held in Trust Account $ 5,973 $ — Unrealized gain on marketable securities held in Trust Account — — Less: interest available to be withdrawn for payment of taxes (5,973) — Net income $ — $ — Denominator: Weighted Average Common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Common stock subject to possible redemption 11,088,616 — Basic and diluted net income per share, Common stock subject to possible redemption $ 0.00 $ — Non-Redeemable Common Stock Numerator: Net Loss minus Net Earnings Net loss $ (247,531) $ (85) Net income allocable to Common stock subject to possible redemption — — Non-Redeemable Net Loss $ (247,531) $ (85) Denominator: Weighted Average Non-redeemable common stock — — Basic and diluted weighted average shares outstanding, Non-redeemable common stock 3,561,384 2,500,000 Basic and diluted net loss per share, Non-redeemable common stock $ (0.07) $ (0.00) | Net Income (Loss) per Common Share Net income (loss) per share is computed by dividing net income (loss) by the weighted-average number of shares of common stock outstanding during the period, excluding shares of common stock subject to forfeiture. At December 31, 2019, weighted average shares were reduced for the effect of an aggregate of 375,000 shares of common stock that were subject to forfeiture if the over-allotment option was not exercised by the underwriters (see Note 7). The Company has not considered the effect of the warrants sold in the Initial Public Offering and private placement to purchase an aggregate of 5,887,500 shares in the calculation of diluted loss per share, since the exercise of the warrants are contingent upon the occurrence of future events. The Company’s statement of operations includes a presentation of income (loss) per share for common shares subject to possible redemption in a manner similar to the two-class method of income (loss) per share. Net income (loss) per common share, basic and diluted, for Common stock subject to possible redemption is calculated by dividing the proportionate share of income or loss on marketable securities held by the Trust Account, net of applicable franchise and income taxes, by the weighted average number of Common stock subject to possible redemption outstanding since original issuance. Net income (loss) per share, basic and diluted, for non-redeemable common stock is calculated by dividing the net income (loss), adjusted for income or loss on marketable securities attributable to Common stock subject to possible redemption, by the weighted average number of non-redeemable common stock outstanding for the period. Non-redeemable common stock includes Founder Shares and non-redeemable shares of common stock as these shares do not have any redemption features. Non-redeemable common stock participates in the income or loss on marketable securities based on non-redeemable shares’ proportionate interest. The following table reflects the calculation of basic and diluted net income (loss) per common share (in dollars, except per share amounts): For the Period from February 13, 2019 Year Ended (inception) December 31, through 2020 December 31, 2019 Common stock subject to possible redemption Numerator: Earnings allocable to Common stock subject to possible redemption Interest earned on marketable securities held in Trust Account $ 5,785 $ — Unrealized gain on marketable securities held in Trust Account 828 — Less: interest available to be withdrawn for payment of taxes (6,613) — Net income $ — $ — Denominator: Weighted Average Common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Common stock subject to possible redemption 11,111,752 — Basic and diluted net income per share, Common stock subject to possible redemption $ 0.00 $ — Non-Redeemable Common Stock Numerator: Net Loss minus Net Earnings Net loss $ (103,385) $ (1,225) Net income allocable to Common stock subject to possible redemption — — Non-Redeemable Net Loss $ (103,385) $ (1,225) Denominator: Weighted Average Non-redeemable common stock Basic and diluted weighted average shares outstanding, Non-redeemable common stock 2,545,512 2,500,000 Basic and diluted net loss per share, Non-redeemable common stock $ (0.04) $ (0.00) |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash accounts in a financial institution, which, at times may exceed the Federal Depository Insurance Coverage of $250,000. The Company has not experienced losses on these accounts. | Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist of a cash account in a financial institution, which, at times, may exceed the Federal Depository Insurance Coverage of $250,000. The Company has not experienced losses on this account. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC Topic 820, “Fair Value Measurement,” approximates the carrying amounts represented in the accompanying condensed balance sheets, primarily due to their short-term nature. Fair Value Measurements Fair value is defined as the price that would be received for sale of an asset or paid for transfer of a liability, in an orderly transaction between market participants at the measurement date. GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). These tiers include: ● Level 1, defined as observable inputs such as quoted prices (unadjusted) for identical instruments in active markets; ● Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and ● Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. In some circumstances, the inputs used to measure fair value might be categorized within different levels of the fair value hierarchy. In those instances, the fair value measurement is categorized in its entirety in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement. Derivative Financial Instruments The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives in accordance with ASC Topic 815, “Derivatives and Hedging”. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value on the grant date and is then re-valued at each reporting date, with changes in the fair value reported in the statements of operations. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement or conversion of the instrument could be required within 12 months of the balance sheet date. | Fair Value of Financial Instruments The fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC 820, “Fair Value Measurement,” approximates the carrying amounts represented in the accompanying balance sheets, primarily due to their short-term nature. |
Recent Accounting Standards | Recent Accounting Standards Management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s condensed financial statements. | Recent Accounting Standards Management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s financial statements. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Reconciliation of Net Loss per Common Share | Three Months Three Months Ended Ended March 31, March 31, 2021 2020 Common stock subject to possible redemption Numerator: Earnings allocable to Common stock subject to possible redemption Interest earned on marketable securities held in Trust Account $ 5,973 $ — Unrealized gain on marketable securities held in Trust Account — — Less: interest available to be withdrawn for payment of taxes (5,973) — Net income $ — $ — Denominator: Weighted Average Common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Common stock subject to possible redemption 11,088,616 — Basic and diluted net income per share, Common stock subject to possible redemption $ 0.00 $ — Non-Redeemable Common Stock Numerator: Net Loss minus Net Earnings Net loss $ (247,531) $ (85) Net income allocable to Common stock subject to possible redemption — — Non-Redeemable Net Loss $ (247,531) $ (85) Denominator: Weighted Average Non-redeemable common stock — — Basic and diluted weighted average shares outstanding, Non-redeemable common stock 3,561,384 2,500,000 Basic and diluted net loss per share, Non-redeemable common stock $ (0.07) $ (0.00) | For the Period from February 13, 2019 Year Ended (inception) December 31, through 2020 December 31, 2019 Common stock subject to possible redemption Numerator: Earnings allocable to Common stock subject to possible redemption Interest earned on marketable securities held in Trust Account $ 5,785 $ — Unrealized gain on marketable securities held in Trust Account 828 — Less: interest available to be withdrawn for payment of taxes (6,613) — Net income $ — $ — Denominator: Weighted Average Common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Common stock subject to possible redemption 11,111,752 — Basic and diluted net income per share, Common stock subject to possible redemption $ 0.00 $ — Non-Redeemable Common Stock Numerator: Net Loss minus Net Earnings Net loss $ (103,385) $ (1,225) Net income allocable to Common stock subject to possible redemption — — Non-Redeemable Net Loss $ (103,385) $ (1,225) Denominator: Weighted Average Non-redeemable common stock Basic and diluted weighted average shares outstanding, Non-redeemable common stock 2,545,512 2,500,000 Basic and diluted net loss per share, Non-redeemable common stock $ (0.04) $ (0.00) |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
FAIR VALUE MEASUREMENTS | ||
Schedule of company's assets and liabilities that are measured at fair value on a recurring basis | March 31, December 31, Description Level 2021 2020 Assets: Marketable securities held in Trust Account 1 $ 115,012,821 $ 115,006,613 Liabilities Warrant liabilities – Private Placement Warrants 3 $ 178,750 $ 129,250 | December 31, Description Level 2020 Assets: Cash and marketable securities held in Trust Account 1 $ 115,006,613 |
Schedule of quantitative information regarding Level 3 fair value measurements inputs | At As of December 31, March 31, 2020 2021 Stock price $ 9.54 $ 9.91 Strike price $ 11.50 $ 11.50 Volatility 17.5% 19.1% Risk-free rate 0.41% 0.94% Probability of Business Combination occurring 75% 75% Dividend yield 0.0% 0.0% Fair value of warrants $ 0.94 $ 1.30 | |
Schedule of change in the fair value of the warrant liabilities | Warrant Liabilities Fair value as of December 31, 2020 $ 129,250 Change in valuation inputs or other assumptions 49,500 Fair value as of March 31, 2021 178,750 |
Revision to Prior Period Fina_2
Revision to Prior Period Financial Statements Footnote (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Revision to Prior Period Financial Statements Footnote | |
Summary of effect of the revisions to the Post-IPO Balance Sheet and its Annual Report | As Previously As Reported Adjustments Revised Balance sheet as of December 15, 2020 (audited) Warrant Liabilities $ — $ 111,375 $ 111,375 Common Stock Subject to Possible Redemption 111,117,520 (111,375) 111,006,145 Common Stock 355 1 356 Additional Paid-in Capital 5,002,148 477 5,002,625 Accumulated Deficit (2,500) (478) (2,978) Balance sheet as of December 31, 2020 (audited) Warrant Liabilities $ — $ 129,250 $ 129,250 Common Stock Subject to Possible Redemption 111,015,410 (129,250) 110,886,160 Common Stock 355 2 357 Additional Paid-in Capital 5,104,258 18,351 5,122,609 Accumulated Deficit (104,610) (18,353) (122,963) Year ended December 31, 2020 (audited) Change in fair value of warrant liabilities $ — $ (17,875) $ (17,875) Initial public offering costs allocated to warrant liabilities — (478) (478) Net loss (103,385) (18,353) (121,738) Cash Flow Statement for the Year ended December 31, 2020 (audited) Net loss $ (103,385) $ (18,353) $ (121,738) Change in fair value of warrant liabilities — 17,875 17,875 Initial public offering costs allocated to warrant liabilities — 478 478 Initial classification of warrant liabilities — 111,375 111,375 Initial classification of common stock subject to possible redemption 111,117,520 (111,375) 111,006,145 Change in value of common stock subject to possible redemption (102,110) (17,875) (119,985) Statement of Changes in Stockholders’ Equity for the Year ended December 31, 2020 (audited) Sale of 275,000 private units $ 2,750,000 $ (111,375) $ 2,638,625 Common stock Subject to Possible Redemption 111,015,410 (129,250) 110,886,160 Net Loss (103,385) (18,353) (121,738) |
DESCRIPTION OF ORGANIZATION A_2
DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS (Details) - USD ($) | Dec. 15, 2020 | Mar. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Subsidiary, Sale of Stock [Line Items] | ||||
Number of units sold | 275,000 | |||
Transaction Costs | $ 1,654,977 | |||
Underwriting fees | 1,150,000 | |||
Other offering costs | $ 504,977 | |||
Cash held outside the Trust Account | $ 549,040 | $ 696,567 | $ 25,000 | |
Payments for investment of cash in Trust Account | $ 115,000,000 | |||
Threshold minimum aggregate fair market value as percentage of assets held in Trust Account | 80.00% | |||
Threshold percentage of outstanding voting securities of the target to be acquired by post-transaction company to complete business combination | 50.00% | 50.00% | ||
Minimum net tangible assets upon consummation of the Business Combination | $ 5,000,001 | $ 5,000,001 | ||
Obligation to redeem Public Shares if entity does not complete a Business Combination (as a percent) | 100.00% | 100.00% | ||
Redemption period upon closure | 10 days | 5 days | ||
Initial Public Offering | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Number of units sold | 11,500,000 | 11,500,000 | ||
Share price per Unit | $ 10 | $ 10 | ||
Proceeds from issuance initial public offering | $ 115,000,000 | |||
Payments for investment of cash in Trust Account | $ 115,000,000 | |||
Private Placement | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Number of units sold | 275,000 | |||
Sale of Private Placement Warrants (in shares) | 275,000 | |||
Price of warrant | $ 10 | |||
Proceeds from sale of Private Placement Warrants | $ 2,750,000 | |||
Private Placement | Private Placement Warrants | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Sale of Private Placement Warrants (in shares) | 275,000 | 275,000 | ||
Price of warrant | $ 10 | $ 10 | ||
Proceeds from sale of Private Placement Warrants | $ 2,750,000 | $ 2,750,000 | ||
Over-allotment option | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Number of units sold | 1,500,000 | |||
Share price per Unit | $ 10 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) | 3 Months Ended | 11 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||||
Cash equivalents | $ 0 | $ 0 | ||
Unrecognized tax benefits | $ 0 | $ 0 | 0 | |
Unrecognized tax benefits accrued for interest and penalties | $ 0 | $ 0 | ||
Statutory tax rate (as a percent) | 21.00% | 21.00% | 21.00% | 21.00% |
Warrants excluded from calculation of EPS | 5,887,500 | 5,887,500 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Reconciliation of Net income (Loss) per Common Share (Details) - USD ($) | 3 Months Ended | 11 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | |
Numerator: Earnings allocable to Common stock subject to possible redemption | ||||
Interest earned on marketable securities held in Trust Account | $ 5,973 | $ 5,785 | ||
Unrealized gain on marketable securities held in Trust Account | 828 | |||
Less: interest available to be withdrawn for payment of taxes | $ (5,973) | (6,613) | ||
Denominator: Weighted Average Common stock subject to possible redemption | ||||
Weighted average shares outstanding, basic and diluted | 11,088,616 | |||
Basic and diluted net loss per common share | $ 0 | |||
Numerator: Net Loss minus Net Earnings | ||||
Net income attributable to Reservoir Holdings Inc. | $ (247,531) | $ (85) | $ (1,225) | $ (103,385) |
Non-Redeemable Net Loss | $ (247,531) | $ (85) | ||
Denominator: Weighted Average Non-redeemable common stock | ||||
Weighted average shares outstanding, basic and diluted | 11,088,616 | |||
Basic and diluted net loss per common share | $ 0 | |||
Class A Common Stock Subject to Redemption | ||||
Denominator: Weighted Average Common stock subject to possible redemption | ||||
Weighted average shares outstanding, basic and diluted | 11,088,616 | |||
Basic and diluted net loss per common share | $ 0 | $ 0 | ||
Denominator: Weighted Average Non-redeemable common stock | ||||
Weighted average shares outstanding, basic and diluted | 11,088,616 | |||
Basic and diluted net loss per common share | $ 0 | $ 0 | ||
Class A Common Stock Not Subject to Redemption | ||||
Denominator: Weighted Average Common stock subject to possible redemption | ||||
Weighted average shares outstanding, basic and diluted | 3,561,384 | 2,500,000 | 2,500,000 | 2,545,512 |
Basic and diluted net loss per common share | $ (0.07) | $ 0 | $ 0 | $ (0.04) |
Denominator: Weighted Average Non-redeemable common stock | ||||
Weighted average shares outstanding, basic and diluted | 3,561,384 | 2,500,000 | 2,500,000 | 2,545,512 |
Basic and diluted net loss per common share | $ (0.07) | $ 0 | $ 0 | $ (0.04) |
PUBLIC OFFERING (Details)
PUBLIC OFFERING (Details) - $ / shares | Dec. 15, 2020 | Dec. 31, 2020 | Mar. 31, 2021 |
Subsidiary, Sale of Stock [Line Items] | |||
Number of units sold | 275,000 | ||
Initial Public Offering | |||
Subsidiary, Sale of Stock [Line Items] | |||
Number of units sold | 11,500,000 | 11,500,000 | |
Purchase price, per unit | $ 10 | $ 10 | |
Initial Public Offering | Public Warrants | |||
Subsidiary, Sale of Stock [Line Items] | |||
Number of shares in a unit | 1 | ||
Number of warrants in a unit | 0.5 | ||
Number of shares issuable per warrant | 1 | ||
Exercise price of warrants | $ 11.50 | ||
Over-allotment option | |||
Subsidiary, Sale of Stock [Line Items] | |||
Number of units sold | 1,500,000 | ||
Purchase price, per unit | $ 10 |
PRIVATE PLACEMENT (Details)
PRIVATE PLACEMENT (Details) - Private Placement - USD ($) | Dec. 15, 2020 | Mar. 31, 2021 |
Subsidiary, Sale of Stock [Line Items] | ||
Number of warrants to purchase shares issued | 275,000 | |
Price of warrants | $ 10 | |
Aggregate purchase price | $ 2,750,000 | |
Private Placement Warrants | ||
Subsidiary, Sale of Stock [Line Items] | ||
Number of warrants to purchase shares issued | 275,000 | 275,000 |
Price of warrants | $ 10 | $ 10 |
Aggregate purchase price | $ 2,750,000 | $ 2,750,000 |
Number of shares in a unit | 1 | 1 |
Number of warrants in a unit | 0.5 | 0.5 |
Number of shares per warrant | 1 | 1 |
Exercise price of warrant | $ 11.50 | $ 11.50 |
RELATED PARTY TRANSACTIONS - Fo
RELATED PARTY TRANSACTIONS - Founder Shares (Details) - USD ($) | Aug. 31, 2020 | Jun. 29, 2020 | Aug. 31, 2020 | Feb. 28, 2019 | Mar. 31, 2021 | Dec. 31, 2019 | Dec. 31, 2020 |
Related Party Transaction [Line Items] | |||||||
Aggregate purchase price | $ 25,000 | ||||||
Sponsor | |||||||
Related Party Transaction [Line Items] | |||||||
Aggregate purchase price | $ 6,486 | $ 6,486 | |||||
Aggregate number of shares owned | 745,840 | 745,840 | |||||
Shares subject to forfeiture | 375,000 | 375,000 | |||||
Percentage of issued and outstanding shares after the Initial Public Offering collectively held by initial stockholders | 20.00% | 20.00% | |||||
Founder Shares | |||||||
Related Party Transaction [Line Items] | |||||||
Number of shares issued | 100 | ||||||
Aggregate purchase price | $ 25,000 | ||||||
Number of shares transferred back to the company | 1,437,500 | 1,437,500 | |||||
Share dividend | 43,125 | ||||||
Aggregate number of shares owned | 2,875,000 | 4,312,500 | 2,875,000 | ||||
Percentage of transfer of founder shares based on certain exceptions | 50.00% | 50.00% | |||||
Stock price trigger to transfer, assign or sell any shares or warrants of the company, after the completion of the initial business combination (in dollars per share) | $ 12.50 | $ 12.50 | |||||
Threshold trading days for transfer, assign or sale of shares or warrants, after the completion of the initial business combination | 20 days | 20 days | |||||
Threshold consecutive trading days for transfer, assign or sale of shares or warrants, after the completion of the initial business combination | 30 days | 30 days |
RELATED PARTY TRANSACTIONS - Ad
RELATED PARTY TRANSACTIONS - Additional Information (Details) - USD ($) | Dec. 15, 2020 | Dec. 31, 2020 | Aug. 23, 2020 |
Related Party Transaction [Line Items] | |||
Maximum borrowing capacity of related party promissory note | $ 200,000 | ||
Repayment of promissory note - related party | $ 200,000 | $ 200,000 | |
Promissory Note with Related Party | |||
Related Party Transaction [Line Items] | |||
Maximum borrowing capacity of related party promissory note | $ 200,000 | ||
Repayment of promissory note - related party | $ 200,000 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021USD ($)item | Dec. 31, 2020USD ($)item | |
COMMITMENTS AND CONTINGENCIES | ||
Maximum number of demands for registration of securities | item | 2 | 2 |
Cash underwriting discount as a percent of gross offering proceeds | 1.00% | 1.00% |
Aggregate deferred underwriting fee payable | $ | $ 1,150,000 | $ 1,150,000 |
Marketing fee as percent of gross offering proceeds | 4.50% | 4.50% |
STOCKHOLDERS' EQUITY - Common S
STOCKHOLDERS' EQUITY - Common Stock Shares (Details) - $ / shares | Mar. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Class of Stock [Line Items] | |||
Common shares, shares authorized (in shares) | 50,000,000 | 50,000,000 | 50,000,000 |
Common stock, shares, par value | $ 0.0001 | $ 0.0001 | $ 0.0001 |
Common shares, shares issued (in shares) | 3,586,137 | 3,548,459 | 2,875,000 |
Common shares, shares outstanding (in shares) | 3,586,137 | 3,548,459 | 2,875,000 |
Class A common stock subject to possible redemption, issued (in shares) | 11,063,863 | 11,101,541 | 11,101,541 |
Class A common stock subject to possible redemption, outstanding (in shares) | 11,063,863 | 11,101,541 | 11,101,541 |
As Revised | |||
Class of Stock [Line Items] | |||
Common shares, shares authorized (in shares) | 50,000,000 | ||
Common stock, shares, par value | $ 0.0001 | ||
Common shares, shares issued (in shares) | 3,561,384 | ||
Common shares, shares outstanding (in shares) | 3,561,384 | ||
Class A common stock subject to possible redemption, issued (in shares) | 11,088,616 | ||
Class A common stock subject to possible redemption, outstanding (in shares) | 11,088,616 |
WARRANTS (Details)
WARRANTS (Details) - Public Warrants | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021item$ / shares | Dec. 31, 2020$ / shares | |
Class of Warrant or Right [Line Items] | ||
Public Warrants exercisable term after the completion of a business combination | 30 days | 30 days |
Number of days of which warrants will not be effective from the date of business combination | 120 days | 120 days |
Public Warrants expiration term | 5 years | 5 years |
Issue price per share | $ 9.20 | $ 9.20 |
Percentage of gross new proceeds to total equity proceeds used to measure dilution of warrant | 60 | 60 |
Trading period after business combination used to measure dilution of warrant | item | 20 | |
Warrant exercise price adjustment multiple | 115 | 115 |
Warrant redemption price adjustment multiple | 180 | 180 |
Redemption of Warrants When the Price per Class A Ordinary Share Equals or Exceeds $18.00 | ||
Class of Warrant or Right [Line Items] | ||
Redemption price per public warrant (in dollars per share) | $ 0.01 | $ 0.01 |
Threshold trading days for redemption of public warrants | 20 days | 20 days |
Threshold consecutive trading days for redemption of public warrants | 30 days | 30 days |
Redemption period | 30 days | 30 days |
Stock price trigger for redemption of public warrants (in dollars per share) | $ 18 | $ 18 |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | |
Assets: | ||
Marketable securities held in Trust Account | $ 115,012,821 | $ 115,006,613 |
Liabilities | ||
Warrant liabilities | 178,750 | |
Transfer of assets from level 1 to level 2 | 0 | |
Transfer of assets from level 2 to level 1 | 0 | |
Transfers to / from level 3 | 0 | |
Level 1 | Recurring | ||
Assets: | ||
Marketable securities held in Trust Account | 115,012,821 | 115,006,613 |
Level 3 | Recurring | Private Placement Warrants | ||
Liabilities | ||
Warrant liabilities | $ 178,750 | $ 129,250 |
FAIR VALUE MEASUREMENTS - Level
FAIR VALUE MEASUREMENTS - Level 3 Fair Value Measurements Inputs (Details) - Level 3 | Mar. 31, 2021$ / shares | Dec. 31, 2020$ / shares |
Stock price | ||
FAIR VALUE MEASUREMENTS | ||
Measurement input | 9.91 | 9.54 |
Strike price | ||
FAIR VALUE MEASUREMENTS | ||
Measurement input | 11.50 | 11.50 |
Volatility | ||
FAIR VALUE MEASUREMENTS | ||
Measurement input | 19.1 | 17.5 |
Risk-free rate | ||
FAIR VALUE MEASUREMENTS | ||
Measurement input | 0.94 | 0.41 |
Probability of Business Combination occurring | ||
FAIR VALUE MEASUREMENTS | ||
Measurement input | 75 | 75 |
Dividend yield | ||
FAIR VALUE MEASUREMENTS | ||
Measurement input | 0 | 0 |
Fair value of warrants | ||
FAIR VALUE MEASUREMENTS | ||
Measurement input | 1.30 | 0.94 |
FAIR VALUE MEASUREMENTS - Chang
FAIR VALUE MEASUREMENTS - Change in the Fair Value of the Warrant Liabilities (Details) | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Fair value as of March 31, 2021 | $ 178,750 |
Warrants | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Fair value as of December 31, 2020 | 129,250 |
Change in valuation inputs or other assumptions | 49,500 |
Fair value as of March 31, 2021 | $ 178,750 |
Revision to Prior Period Fina_3
Revision to Prior Period Financial Statements Footnote (Details) - USD ($) | 3 Months Ended | 11 Months Ended | 12 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 15, 2020 | |
CONDENSED BALANCE SHEETS | |||||
Warrant Liabilities | $ 178,750 | ||||
Common Stock Subject to Possible Redemption | 110,638,630 | $ 111,015,410 | |||
Common Stock | 359 | $ 288 | 355 | ||
Additional Paid-in Capital | 5,370,137 | 24,712 | 5,104,258 | ||
Accumulated Deficit | (370,494) | (1,225) | (104,610) | ||
CONSOLIDATED STATEMENTS OF INCOME | |||||
Change in fair value of warrant liabilities | (49,500) | ||||
Net income attributable to Reservoir Holdings Inc. | (247,531) | $ (85) | (1,225) | (103,385) | |
CONDENSED STATEMENTS OF CASH FLOWS | |||||
Net income | (247,531) | (85) | (1,225) | (103,385) | |
Change in fair value of warrant liabilities | 49,500 | ||||
Initial classification of common stock subject to possible redemption | 111,117,520 | ||||
Change in value of common stock subject to possible redemption | (247,530) | (102,110) | |||
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY | |||||
Common stock Subject to Possible Redemption | (247,530) | 111,015,410 | |||
Net income attributable to Reservoir Holdings Inc. | $ (247,531) | $ (85) | $ (1,225) | $ (103,385) | |
Sale of Private Units | 275,000 | ||||
As Previously Reported | |||||
CONDENSED BALANCE SHEETS | |||||
Additional Paid-in Capital | $ 5,104,258 | $ 5,002,148 | |||
Accumulated Deficit | (104,610) | (2,500) | |||
CONSOLIDATED STATEMENTS OF INCOME | |||||
Net income attributable to Reservoir Holdings Inc. | (103,385) | ||||
CONDENSED STATEMENTS OF CASH FLOWS | |||||
Net income | (103,385) | ||||
Initial classification of common stock subject to possible redemption | 111,117,520 | ||||
Change in value of common stock subject to possible redemption | (102,110) | ||||
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY | |||||
Sale of 275,000 private units | 2,750,000 | ||||
Common stock Subject to Possible Redemption | 111,015,410 | ||||
Net income attributable to Reservoir Holdings Inc. | (103,385) | ||||
Adjustments | |||||
CONDENSED BALANCE SHEETS | |||||
Warrant Liabilities | 129,250 | 111,375 | |||
Additional Paid-in Capital | 18,351 | 477 | |||
Accumulated Deficit | (18,353) | (478) | |||
CONSOLIDATED STATEMENTS OF INCOME | |||||
Change in fair value of warrant liabilities | (17,875) | ||||
Initial public offering costs allocated to warrant liability | (478) | ||||
Net income attributable to Reservoir Holdings Inc. | (18,353) | ||||
CONDENSED STATEMENTS OF CASH FLOWS | |||||
Net income | (18,353) | ||||
Change in fair value of warrant liabilities | 17,875 | ||||
Initial public offering costs allocated to warrant liabilities | 478 | ||||
Initial classification of warrant liabilities | 111,375 | ||||
Initial classification of common stock subject to possible redemption | (111,375) | ||||
Change in value of common stock subject to possible redemption | (17,875) | ||||
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY | |||||
Sale of 275,000 private units | (111,375) | ||||
Common stock Subject to Possible Redemption | (129,250) | ||||
Net income attributable to Reservoir Holdings Inc. | (18,353) | ||||
As Revised | |||||
CONDENSED BALANCE SHEETS | |||||
Warrant Liabilities | 129,250 | 111,375 | |||
Common Stock Subject to Possible Redemption | 110,886,160 | ||||
Common Stock | 357 | ||||
Additional Paid-in Capital | 5,122,609 | 5,002,625 | |||
Accumulated Deficit | (122,963) | (2,978) | |||
CONSOLIDATED STATEMENTS OF INCOME | |||||
Change in fair value of warrant liabilities | (17,875) | ||||
Initial public offering costs allocated to warrant liability | (478) | ||||
Net income attributable to Reservoir Holdings Inc. | (121,738) | ||||
CONDENSED STATEMENTS OF CASH FLOWS | |||||
Net income | (121,738) | ||||
Change in fair value of warrant liabilities | 17,875 | ||||
Initial public offering costs allocated to warrant liabilities | 478 | ||||
Initial classification of warrant liabilities | 111,375 | ||||
Initial classification of common stock subject to possible redemption | 111,006,145 | ||||
Change in value of common stock subject to possible redemption | (119,985) | ||||
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY | |||||
Sale of 275,000 private units | 2,638,625 | ||||
Common stock Subject to Possible Redemption | 110,886,160 | ||||
Net income attributable to Reservoir Holdings Inc. | (121,738) | ||||
Class A Common Stock | As Previously Reported | |||||
CONDENSED BALANCE SHEETS | |||||
Common Stock Subject to Possible Redemption | 111,015,410 | 111,117,520 | |||
Common Stock | 355 | 355 | |||
Class A Common Stock | Adjustments | |||||
CONDENSED BALANCE SHEETS | |||||
Common Stock Subject to Possible Redemption | (129,250) | (111,375) | |||
Common Stock | 2 | 1 | |||
Class A Common Stock | As Revised | |||||
CONDENSED BALANCE SHEETS | |||||
Common Stock Subject to Possible Redemption | 110,886,160 | 111,006,145 | |||
Common Stock | $ 357 | $ 356 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) $ in Millions | Apr. 14, 2021USD ($) |
Merger Agreement | Subsequent event | |
Subsequent Event [Line Items] | |
Concurrent closing of private placement | $ 150 |
BALANCE SHEETS
BALANCE SHEETS - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Feb. 12, 2019 |
Current assets | ||||
Cash | $ 549,040 | $ 696,567 | $ 25,000 | |
Prepaid expenses and other current assets | 380,555 | |||
Prepaid expenses | 395,887 | |||
Total current assets | 929,595 | 1,092,454 | 25,000 | |
Cash and marketable securities held in Trust Account | 115,012,821 | 115,006,613 | ||
Total assets | 115,942,416 | 116,099,067 | 25,000 | |
Current liabilities | ||||
Accrued expenses | 125,034 | 83,654 | 1,225 | |
Total current liabilities | 125,034 | |||
Warrant liabilities | 178,750 | |||
Total Liabilities | 303,784 | 83,654 | 1,225 | |
Commitments and Contingencies (see Note 6) | ||||
Common stock subject to possible redemption; 11,063,863 and 11,088,616 shares at redemption value at June 30, 2021 and December 31, 2020, respectively | 110,638,630 | 111,015,410 | ||
Stockholder's Equity | ||||
Common stock, $0.00001 par value; 1,000,000 shares authorized, 145,560 shares issued and outstanding at March 31, 2021; and 140,227 shares issued and outstanding at March 31, 2020 | 359 | 355 | 288 | |
Additional paid-in capital | 5,370,137 | 5,104,258 | 24,712 | |
Accumulated deficit | (370,494) | (104,610) | (1,225) | |
Total Reservoir Holdings Inc. shareholders' equity | 5,000,002 | 5,000,003 | 23,775 | $ 0 |
Total liabilities and shareholders' equity | $ 115,942,416 | $ 116,099,067 | $ 25,000 |
BALANCE SHEETS (Parenthetical)
BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Common shares, par value, (per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 |
Common stock, shares, authorized | 50,000,000 | 50,000,000 | 50,000,000 |
Common stock, shares, issued | 3,586,137 | 3,548,459 | 2,875,000 |
Common stock, shares, Outstanding | 3,586,137 | 3,548,459 | 2,875,000 |
Temporary equity, shares issued | 11,063,863 | 11,101,541 | 11,101,541 |
Temporary equity, shares outstanding | 11,063,863 | 11,101,541 | 11,101,541 |
Common stock subject to redemption | |||
Temporary equity, shares outstanding | 0 | 0 |
STATEMENTS OF OPERATIONS
STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | 11 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | |
Formation and operational costs | $ 204,239 | $ 85 | $ 1,225 | $ 109,998 |
Loss from operations | (204,239) | (85) | (1,225) | (109,998) |
Other income: | ||||
Interest earned on marketable securities held in Trust Account | 6,208 | 5,785 | ||
Unrealized gain on marketable securities held in Trust Account | 828 | |||
Change in fair value of warrant liabilities | (49,500) | |||
Other expense, net | (43,292) | 6,613 | ||
Loss before income taxes | (247,531) | (85) | ||
Net income attributable to Reservoir Holdings Inc. | $ (247,531) | $ (85) | (1,225) | (103,385) |
Weighted average shares outstanding, basic and diluted | 11,088,616 | |||
Basic and diluted net loss per common share | $ 0 | |||
Common Class Subject To Redemption Member | ||||
Other income: | ||||
Net income attributable to Reservoir Holdings Inc. | $ (1,225) | $ (103,385) | ||
Weighted average shares outstanding, basic and diluted | 11,111,752 | |||
Basic and diluted net loss per common share | $ 0 | |||
Class A Common Stock Not Subject to Redemption | ||||
Other income: | ||||
Weighted average shares outstanding, basic and diluted | 3,561,384 | 2,500,000 | 2,500,000 | 2,545,512 |
Basic and diluted net loss per common share | $ (0.07) | $ 0 | $ 0 | $ (0.04) |
Class A Common Stock Subject to Redemption | ||||
Other income: | ||||
Weighted average shares outstanding, basic and diluted | 11,088,616 | |||
Basic and diluted net loss per common share | $ 0 | $ 0 |
STATEMENTS OF CHANGES IN STOCKH
STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) | Initial Public OfferingCommon Stock | Initial Public OfferingAdditional Paid-In Capital | Initial Public Offering | Private PlacementCommon Stock | Private PlacementAdditional Paid-In Capital | Private Placement | Common Stock | Additional Paid-In Capital | Retained earnings (Accumulated deficit) | Total |
Balance at the beginning at Feb. 12, 2019 | $ 0 | $ 0 | $ 0 | $ 0 | ||||||
Balance at the beginning (in shares) at Feb. 12, 2019 | 0 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Issuance of common shares | $ 288 | 24,712 | 25,000 | |||||||
Issuance of common shares (in shares) | 2,875,000 | |||||||||
Net income attributable to Reservoir Holdings Inc. | (1,225) | (1,225) | ||||||||
Balance at the end at Dec. 31, 2019 | $ 288 | 24,712 | (1,225) | 23,775 | ||||||
Balance at the end (in shares) at Dec. 31, 2019 | 2,875,000 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net income attributable to Reservoir Holdings Inc. | $ 0 | 0 | (85) | (85) | ||||||
Balance at the beginning at Dec. 31, 2019 | $ 288 | 24,712 | (1,225) | $ 23,775 | ||||||
Balance at the beginning (in shares) at Dec. 31, 2019 | 2,875,000 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Sale of Units | $ 1,150 | $ 113,343,873 | $ 113,345,023 | $ 28 | $ 2,749,972 | $ 2,750,000 | ||||
Sale of Units (in shares) | 11,500,000 | 11,500,000 | 275,000 | 275,000 | 275,000 | |||||
Common stock subject to possible redemption | $ (1,111) | (111,014,299) | $ (111,015,410) | |||||||
Common stock subject to possible redemption (in shares) | (11,101,541) | |||||||||
Net income attributable to Reservoir Holdings Inc. | (103,385) | (103,385) | ||||||||
Balance at the end at Dec. 31, 2020 | $ 355 | 5,104,258 | (104,610) | 5,000,003 | ||||||
Balance at the end (in shares) at Dec. 31, 2020 | 3,548,459 | |||||||||
Balance at the end at Mar. 31, 2021 | 5,000,002 | |||||||||
Balance at the beginning at Dec. 31, 2020 | $ 355 | 5,104,258 | (104,610) | 5,000,003 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Common stock subject to possible redemption | $ 2 | 247,528 | 247,530 | |||||||
Common stock subject to possible redemption (in shares) | 24,753 | |||||||||
Net income attributable to Reservoir Holdings Inc. | $ 0 | $ (247,531) | (247,531) | |||||||
Balance at the end at Mar. 31, 2021 | $ 5,000,002 |
STATEMENT OF CHANGES IN STOCKHO
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (Parenthetical) - shares | Dec. 15, 2020 | Dec. 31, 2020 |
Sale of Units (in shares) | 275,000 | |
Initial Public Offering | ||
Sale of Units (in shares) | 11,500,000 | 11,500,000 |
Private Placement | ||
Sale of Units (in shares) | 275,000 |
STATEMENTS OF CASH FLOWS
STATEMENTS OF CASH FLOWS - USD ($) | Dec. 15, 2020 | Feb. 12, 2019 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Cash flows from operating activities | ||||||||
Net income | $ (247,531) | $ (85) | $ (1,225) | $ (103,385) | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Interest earned on marketable securities held in Trust Account | (6,208) | (5,785) | ||||||
Unrealized gain on marketable securities held in Trust Account | (828) | |||||||
Change in fair value of warrant liabilities | 49,500 | |||||||
Changes in operating assets and liabilities: | ||||||||
Prepaid expenses | 15,332 | (395,887) | ||||||
Accrued expenses | 41,380 | (225) | 1,225 | 82,429 | ||||
Net cash provided by operating activities | (147,527) | (310) | (423,456) | |||||
Cash flows from investing activities: | ||||||||
Investment of cash in Trust Account | (115,000,000) | |||||||
Net cash used for investing activities | (115,000,000) | |||||||
Cash flows from financing activities: | ||||||||
Aggregate consideration from issue of common stock | 25,000 | |||||||
Proceeds from sale of Units, net of underwriting discounts paid | 113,850,000 | |||||||
Proceeds from sale of Private Units | 2,750,000 | |||||||
Proceeds from promissory note - related party | 200,000 | |||||||
Repayment of promissory note - related party | $ (200,000) | (200,000) | ||||||
Payment of offering costs | (504,977) | |||||||
Net cash provided by financing activities | 25,000 | 116,095,023 | ||||||
Net Change in Cash | $ 25,000 | (147,527) | (310) | $ 671,567 | ||||
Cash, cash equivalents and restricted cash beginning of year | 696,567 | 25,000 | $ 24,690 | 25,000 | ||||
Cash and cash equivalents end of year | 549,040 | $ 24,690 | $ 25,000 | $ 549,040 | 696,567 | $ 25,000 | ||
Non-Cash investing and financing activities: | ||||||||
Initial classification of common stock subject to possible redemption | 111,117,520 | |||||||
Change in value of common stock subject to possible redemption | $ (247,530) | $ (102,110) |
DESCRIPTION OF ORGANIZATION A_3
DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS | ||
DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS | NOTE 1. DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS Roth CH Acquisition II Co. (formerly known as Roth Acquisition I Co.) (the “Company”) was incorporated in Delaware on February 13, 2019. The Company is a blank check company formed for the purpose of entering into a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization or other similar business combination with one or more businesses or entities (the “Business Combination”). The Company is an early stage and emerging growth company and, as such, the Company is subject to all of the risks associated with early stage and emerging growth companies. As of March 31, 2021, the Company had not commenced any operations. All activity for the period from February 13, 2019 (inception) through March 31, 2021 relates to the Company’s formation and the initial public offering (“Initial Public Offering”), which is described below. The Company will not generate any operating revenues until after the completion of a Business Combination, at the earliest. The Company will generate non-operating income in the form of interest income from the proceeds derived from the Initial Public Offering. The registration statement for the Company’s Initial Public Offering was declared effective on December 10, 2020. On December 15, 2020, the Company consummated the Initial Public Offering of 11,500,000 units (the “Units” and, with respect to the shares of common stock included in the Units sold, the “Public Shares”), which includes the full exercise by the underwriters of their over-allotment option in the amount of 1,500,000 Units, at $10.00 per Unit, generating gross proceeds of $115,000,000, which is described in Note 3. Simultaneously with the closing of the Initial Public Offering, the Company consummated the sale of 275,000 units (the “Private Units”) at a price of $10.00 per Private Unit in a private placement to certain of the Company’s stockholders, generating gross proceeds of $2,750,000, which is described in Note 4. Transaction costs amounted to $1,654,977 consisting of $1,150,000 of underwriting fees, and $504,977 of other offering costs. Following the closing of the Initial Public Offering on December 15, 2020, an amount of $115,000,000 ($10.00 per Unit) from the net proceeds of the sale of the Units in the Initial Public Offering and the sale of the Private Units was placed in a trust account (the “Trust Account”), located in the United States and will be held in cash items or invested in U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act, with a maturity of 185 days or less or in any open-ended investment company that holds itself out as a money market fund selected by the Company meeting the conditions of Rule 2a-7 of the Investment Company Act of 1940, as amended (the “Investment Company Act”), as determined by the Company, until the earlier of: (i) the completion of a Business Combination and (ii) the distribution of the Trust Account, as described below. The Company’s management has broad discretion with respect to the specific application of the net proceeds of the Initial Public Offering and the sale of the Private Units, although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination. There is no assurance that the Company will be able to complete a Business Combination successfully. The Company must complete a Business Combination having an aggregate fair market value of at least 80% of the assets held in the Trust Account (excluding taxes payable on income earned on the Trust Account) at the time of the agreement to enter into an initial Business Combination. The Company will only complete a Business Combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. The Company will provide its holders of the outstanding Public Shares (the “public stockholders”) with the opportunity to redeem all or a portion of their Public Shares upon the completion of a Business Combination either (i) in connection with a stockholder meeting called to approve the Business Combination or (ii) by means of a tender offer. The decision as to whether the Company will seek stockholder approval of a Business Combination or conduct a tender offer will be made by the Company, solely in its discretion. The public stockholders will be entitled to redeem their Public Shares for a pro rata portion of the amount then in the Trust Account (initially anticipated to be $10.00 per Public Share, plus any pro rata interest earned on the funds held in the Trust Account and not previously released to the Company to pay its tax obligations). There will be no redemption rights upon the completion of a Business Combination with respect to the Company’s warrants. The Company will proceed with a Business Combination if the Company has net tangible assets of at least $5,000,001 either immediately prior to or upon such consummation of a Business Combination and, if the Company seeks stockholder approval, a majority of the shares voted are voted in favor of the Business Combination. If a stockholder vote is not required by law and the Company does not decide to hold a stockholder vote for business or other legal reasons, the Company will, pursuant to its Amended and Restated Certificate of Incorporation (the “Amended and Restated Certificate of Incorporation”), conduct the redemptions pursuant to the tender offer rules of the U.S. Securities and Exchange Commission (“SEC”) and file tender offer documents with the SEC containing substantially the same information as would be included in a proxy statement prior to completing a Business Combination. If, however, stockholder approval of the transaction is required by law, or the Company decides to obtain stockholder approval for business or legal reasons, the Company will offer to redeem shares in conjunction with a proxy solicitation pursuant to the proxy rules and not pursuant to the tender offer rules. If the Company seeks stockholder approval in connection with a Business Combination, the holders of the Company’s shares prior to the Initial Public Offering (the “Initial Stockholders”) have agreed to vote their Founder Shares (as defined in Note 5), Private Shares (as defined in Note 4) and any Public Shares purchased during or after the Initial Public Offering (a) in favor of approving a Business Combination and (b) not to redeem any shares in connection with a stockholder vote to approve a Business Combination or sell any shares to the Company in a tender offer in connection with a Business Combination. Additionally, each public stockholder may elect to redeem their Public Shares irrespective of how or whether they vote on the proposed transaction or don’t vote at all. The Initial Stockholders have agreed (a) to waive their redemption rights with respect to their Founder Shares, Private Shares and Public Shares held by them in connection with the completion of a Business Combination and (b) not to propose an amendment to the Amended and Restated Certificate of Incorporation that would affect a public stockholders’ ability to convert or sell their shares to the Company in connection with a Business Combination or affect the substance or timing of the Company’s obligation to redeem 100% of its Public Shares if the Company does not complete a Business Combination, unless the Company provides the public stockholders with the opportunity to redeem their Public Shares in conjunction with any such amendment. The Company will have until December 15, 2022 to complete a Business Combination (the “Combination Period”). If the Company is unable to complete a Business Combination within the Combination Period, the Company will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than five The Initial Stockholders have agreed to waive their liquidation rights with respect to the Founder Shares and Private Shares if the Company fails to complete a Business Combination within the Combination Period. However, if the Initial Stockholders acquire Public Shares in or after the Initial Public Offering, such Public Shares will be entitled to liquidating distributions from the Trust Account if the Company fails to complete a Business Combination within the Combination Period. In the event of such distribution, it is possible that the per share value of the assets remaining available for distribution will be less than the Initial Public Offering price per Unit ($10.00). In order to protect the amounts held in the Trust Account, the Initial Stockholders have agreed to be liable to the Company if and to the extent any claims by a vendor for services rendered or products sold to the Company, or a prospective target business with which the Company has discussed entering into a transaction agreement, reduce the amount of funds in the Trust Account to below $10.00 per Public Share, except as to any claims by a third party who executed a valid and enforceable agreement with the Company waiving any right, title, interest or claim of any kind they may have in or to any monies held in the Trust Account and except as to any claims under the Company’s indemnity of the underwriters of Initial Public Offering against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the “Securities Act”). Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, the Initial Stockholders will not be responsible to the extent of any liability for such third-party claims. The Company will seek to reduce the possibility that Initial Stockholders will have to indemnify the Trust Account due to claims of creditors by endeavoring to have all vendors, service providers, (except the Company’s independent registered public accounting firm), prospective target businesses or other entities with which the Company does business, execute agreements with the Company waiving any right, title, interest or claim of any kind in or to monies held in the Trust Account. Risks and Uncertainties Management continues to evaluate the impact of the COVID-19 pandemic and has concluded that while it is reasonably possible that the virus could have a negative effect on the Company’s financial position and/or search for a target company, the specific impact is not readily determinable as of the date of the financial statements. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. | NOTE 1 — DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS Roth CH Acquisition II Co. (formerly known as Roth Acquisition I Co.) (the “Company”) was incorporated in Delaware on February 13, 2019. The Company is a blank check company formed for the purpose of entering into a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization or other similar business combination with one or more businesses or entities (the “Business Combination”). The Company is an early stage and emerging growth company and, as such, the Company is subject to all of the risks associated with early stage and emerging growth companies. As of December 31, 2020, the Company had not commenced any operations. All activity for the period from February 13, 2019 (inception) through December 31, 2020 relates to the Company’s formation and the initial public offering (“Initial Public Offering”), which is described below. The Company will not generate any operating revenues until after the completion of a Business Combination, at the earliest. The Company will generate non-operating income in the form of interest income from the proceeds derived from the Initial Public Offering. The registration statement for the Company’s Initial Public Offering was declared effective on December 10, 2020. On December 15, 2020, the Company consummated the Initial Public Offering of 11,500,000 units (the “Units” and, with respect to the shares of common stock included in the Units sold, the “Public Shares”), which includes the full exercise by the underwriters of their over-allotment option in the amount of 1,500,000 Units, at $10.00 per Unit, generating gross proceeds of $115,000,000, which is described in Note 3. Simultaneously with the closing of the Initial Public Offering, the Company consummated the sale of 275,000 units (the “Private Units”) at a price of $10.00 per Private Unit in a private placement to certain of the Company’s stockholders, generating gross proceeds of $2,750,000, which is described in Note 4. Transaction costs amounted to $1,654,977 consisting of $1,150,000 of underwriting fees, and $504,977 of other offering costs. Following the closing of the Initial Public Offering on December 15, 2020, an amount of $115,000,000 ($10.00 per Unit) from the net proceeds of the sale of the Units in the Initial Public Offering and the sale of the Private Units was placed in a trust account (the “Trust Account”), located in the United States and will be held in cash items or invested in U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act, with a maturity of 185 days or less or in any open-ended investment company that holds itself out as a money market fund selected by the Company meeting the conditions of Rule 2a-7 of the Investment Company Act of 1940, as amended (the “Investment Company Act”), as determined by the Company, until the earlier of: (i) the completion of a Business Combination and (ii) the distribution of the Trust Account, as described below. The Company’s management has broad discretion with respect to the specific application of the net proceeds of the Initial Public Offering and the sale of the Private Units, although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination. There is no assurance that the Company will be able to complete a Business Combination successfully. The Company must complete a Business Combination having an aggregate fair market value of at least 80% of the assets held in the Trust Account (excluding taxes payable on income earned on the Trust Account) at the time of the agreement to enter into an initial Business Combination. The Company will only complete a Business Combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. The Company will provide its holders of the outstanding Public Shares (the “public stockholders”) with the opportunity to redeem all or a portion of their Public Shares upon the completion of a Business Combination either (i) in connection with a stockholder meeting called to approve the Business Combination or (ii) by means of a tender offer. The decision as to whether the Company will seek stockholder approval of a Business Combination or conduct a tender offer will be made by the Company, solely in its discretion. The public stockholders will be entitled to redeem their Public Shares for a pro rata portion of the amount then in the Trust Account (initially anticipated to be $10.00 per Public Share, plus any pro rata interest earned on the funds held in the Trust Account and not previously released to the Company to pay its tax obligations). There will be no redemption rights upon the completion of a Business Combination with respect to the Company’s warrants. The Company will proceed with a Business Combination if the Company has net tangible assets of at least $5,000,001 either immediately prior to or upon such consummation of a Business Combination and, if the Company seeks stockholder approval, a majority of the shares voted are voted in favor of the Business Combination. If a stockholder vote is not required by law and the Company does not decide to hold a stockholder vote for business or other legal reasons, the Company will, pursuant to its Amended and Restated Certificate of Incorporation (the “Amended and Restated Certificate of Incorporation”), conduct the redemptions pursuant to the tender offer rules of the U.S. Securities and Exchange Commission (“SEC”) and file tender offer documents with the SEC containing substantially the same information as would be included in a proxy statement prior to completing a Business Combination. If, however, stockholder approval of the transaction is required by law, or the Company decides to obtain stockholder approval for business or legal reasons, the Company will offer to redeem shares in conjunction with a proxy solicitation pursuant to the proxy rules and not pursuant to the tender offer rules. If the Company seeks stockholder approval in connection with a Business Combination, the holders of the Company’s shares prior to the Initial Public Offering (the “Initial Stockholders”) have agreed to vote their Founder Shares (as defined in Note 5), Private Shares (as defined in Note 4) and any Public Shares purchased during or after the Initial Public Offering (a) in favor of approving a Business Combination and (b) not to redeem any shares in connection with a stockholder vote to approve a Business Combination or sell any shares to the Company in a tender offer in connection with a Business Combination. Additionally, each public stockholder may elect to redeem their Public Shares irrespective of how or whether they vote on the proposed transaction or don’t vote at all. The Initial Stockholders have agreed (a) to waive their redemption rights with respect to their Founder Shares, Private Shares and Public Shares held by them in connection with the completion of a Business Combination and (b) not to propose an amendment to the Amended and Restated Certificate of Incorporation that would affect a public stockholders’ ability to convert or sell their shares to the Company in connection with a Business Combination or affect the substance or timing of the Company’s obligation to redeem 100% of its Public Shares if the Company does not complete a Business Combination, unless the Company provides the public stockholders with the opportunity to redeem their Public Shares in conjunction with any such amendment. The Company will have until December 15, 2022 to complete a Business Combination (the “Combination Period”). If the Company is unable to complete a Business Combination within the Combination Period, the Company will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than five The Initial Stockholders have agreed to waive their liquidation rights with respect to the Founder Shares and Private Shares if the Company fails to complete a Business Combination within the Combination Period. However, if the Initial Stockholders acquire Public Shares in or after the Initial Public Offering, such Public Shares will be entitled to liquidating distributions from the Trust Account if the Company fails to complete a Business Combination within the Combination Period. In the event of such distribution, it is possible that the per share value of the assets remaining available for distribution will be less than the Initial Public Offering price per Unit ($10.00). In order to protect the amounts held in the Trust Account, the Initial Stockholders have agreed to be liable to the Company if and to the extent any claims by a vendor for services rendered or products sold to the Company, or a prospective target business with which the Company has discussed entering into a transaction agreement, reduce the amount of funds in the Trust Account to below $10.00 per Public Share, except as to any claims by a third party who executed a valid and enforceable agreement with the Company waiving any right, title, interest or claim of any kind they may have in or to any monies held in the Trust Account and except as to any claims under the Company’s indemnity of the underwriters of Initial Public Offering against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the “Securities Act”). Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, the Initial Stockholders will not be responsible to the extent of any liability for such third-party claims. The Company will seek to reduce the possibility that Initial Stockholders will have to indemnify the Trust Account due to claims of creditors by endeavoring to have all vendors, service providers, (except the Company’s independent registered public accounting firm), prospective target businesses or other entities with which the Company does business, execute agreements with the Company waiving any right, title, interest or claim of any kind in or to monies held in the Trust Account. Risks and Uncertainties Management continues to evaluate the impact of the COVID-19 pandemic and has concluded that while it is reasonably possible that the virus could have a negative effect on the Company’s financial position and/or search for a target company, the specific impact is not readily determinable as of the date of the financial statements. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X of the Securities and Exchange Commission (the “SEC”). Certain information or footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows. In the opinion of management, the accompanying unaudited condensed financial statements include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented. The accompanying unaudited condensed financial statements should be read in conjunction with the Company’s Annual report on Form 10-K, as filed with the SEC on March 29, 2021. The interim results for the three months ended March 31, 2021 are not necessarily indicative of the results to be expected for the period ending December 31, 2021 or for any future periods. Emerging Growth Company The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used. Use of Estimates The preparation of financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates. Cash and Cash Equivalents The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The Company did not have any cash equivalents as of March 31, 2021 and 2020. Marketable Securities Held in Trust Account December 31, 2020 substantially all of the assets held in the Trust Account were held in U.S. Treasury Bills. Common Stock Subject to Possible Redemption The Company accounts for its common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Common stock subject to mandatory redemption is classified as a liability instrument and is measured at fair value. Conditionally redeemable common stock (including common stock that features redemption rights that is either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) is classified as temporary equity. At all other times, common stock is classified as stockholders’ equity. The Company’s common stock features certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, at December 31, 2020, common stock subject to possible redemption is presented at redemption value as temporary equity, outside of the stockholders’ equity section of the Company’s balance sheets. Warrant Liability The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 480, Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own ordinary shares, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding. For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded at their initial fair value on the date of issuance, and each balance sheet date thereafter. Changes in the estimated fair value of the warrants are recognized as a non-cash gain or loss on the statements of operations. The fair value of the warrants was estimated using a Binomial Lattice Model (see Note 9). Income Taxes The Company follows the asset and liability method of accounting for income taxes under ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of March 31, 2021 and December 31, 2020. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company is subject to income tax examinations by major taxing authorities since inception. The effective tax rate differs from the statutory tax rate of 21% for the three months ended March 31, 2021 and 2020, due to the valuation allowance recorded on the Company’s net operating losses. Net income (Loss) per Common Share Net income (loss) per share is computed by dividing net income (loss) by the weighted-average number of shares of common stock outstanding during the period, excluding shares of common stock subject to forfeiture. The Company has not considered the effect of the warrants sold in the Initial Public Offering and private placement to purchase an aggregate of 5,887,500 shares in the calculation of diluted loss per share, since the exercise of the warrants are contingent upon the occurrence of future events. The Company’s statement of operations includes a presentation of income (loss) per share for common shares subject to possible redemption in a manner similar to the two-class method of income (loss) per share. Net income (loss) per common share, basic and diluted, for Common stock subject to possible redemption is calculated by dividing the proportionate share of income or loss on marketable securities held by the Trust Account, net of applicable franchise and income taxes, by the weighted average number of Common stock subject to possible redemption outstanding since original issuance. Net income (loss) per share, basic and diluted, for non-redeemable common stock is calculated by dividing the net income (loss), adjusted for income or loss on marketable securities attributable to Common stock subject to possible redemption, by the weighted average number of non-redeemable common stock outstanding for the period. Non-redeemable common stock includes Founder Shares and non-redeemable shares of common stock as these shares do not have any redemption features. Non-redeemable common stock participates in the income or loss on marketable securities based on non-redeemable shares’ proportionate interest. The following table reflects the calculation of basic and diluted net income (loss) per common share (in dollars, except per share amounts): Three Months Three Months Ended Ended March 31, March 31, 2021 2020 Common stock subject to possible redemption Numerator: Earnings allocable to Common stock subject to possible redemption Interest earned on marketable securities held in Trust Account $ 5,973 $ — Unrealized gain on marketable securities held in Trust Account — — Less: interest available to be withdrawn for payment of taxes (5,973) — Net income $ — $ — Denominator: Weighted Average Common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Common stock subject to possible redemption 11,088,616 — Basic and diluted net income per share, Common stock subject to possible redemption $ 0.00 $ — Non-Redeemable Common Stock Numerator: Net Loss minus Net Earnings Net loss $ (247,531) $ (85) Net income allocable to Common stock subject to possible redemption — — Non-Redeemable Net Loss $ (247,531) $ (85) Denominator: Weighted Average Non-redeemable common stock — — Basic and diluted weighted average shares outstanding, Non-redeemable common stock 3,561,384 2,500,000 Basic and diluted net loss per share, Non-redeemable common stock $ (0.07) $ (0.00) Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash accounts in a financial institution, which, at times may exceed the Federal Depository Insurance Coverage of $250,000. The Company has not experienced losses on these accounts. Fair Value of Financial Instruments The fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC Topic 820, “Fair Value Measurement,” approximates the carrying amounts represented in the accompanying condensed balance sheets, primarily due to their short-term nature. Fair Value Measurements Fair value is defined as the price that would be received for sale of an asset or paid for transfer of a liability, in an orderly transaction between market participants at the measurement date. GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). These tiers include: ● Level 1, defined as observable inputs such as quoted prices (unadjusted) for identical instruments in active markets; ● Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and ● Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. In some circumstances, the inputs used to measure fair value might be categorized within different levels of the fair value hierarchy. In those instances, the fair value measurement is categorized in its entirety in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement. Derivative Financial Instruments The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives in accordance with ASC Topic 815, “Derivatives and Hedging”. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value on the grant date and is then re-valued at each reporting date, with changes in the fair value reported in the statements of operations. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement or conversion of the instrument could be required within 12 months of the balance sheet date. Recent Accounting Standards Management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s condensed financial statements. | NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying financial statements are presented in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the SEC. Emerging Growth Company The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used. Use of Estimates The preparation of financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates. Cash and Cash Equivalents The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The Company did not have any cash equivalents as of December 31, 2020 and 2019. Marketable Securities Held in Trust Account December 31, 2020 substantially all of the assets held in the Trust Account were held in U.S. Treasury Bills. Common Stock Subject to Possible Redemption The Company accounts for its common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Common stock subject to mandatory redemption is classified as a liability instrument and is measured at fair value. Conditionally redeemable common stock (including common stock that features redemption rights that is either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) is classified as temporary equity. At all other times, common stock is classified as stockholders’ equity. The Company’s common stock features certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, at December 31, 2020, common stock subject to possible redemption is presented at redemption value as temporary equity, outside of the stockholders’ equity section of the Company’s balance sheets. Income Taxes The Company follows the asset and liability method of accounting for income taxes under ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of December 31, 2020 and 2019. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company is subject to income tax examinations by major taxing authorities since inception. On March 27, 2020, the CARES Act was enacted in response to COVID-19 pandemic. Under ASC 740, the effects of changes in tax rates and laws are recognized in the period which the new legislation is enacted. The CARES Act made various tax law changes including among other things (i) increasing the limitation under Section 163(j) of the Internal Revenue Code of 1986, as amended (the “IRC”) for 2019 and 2020 to permit additional expensing of interest (ii) enacting a technical correction so that qualified improvement property can be immediately expensed under IRC Section 168(k), (iii) making modifications to the federal net operating loss rules including permitting federal net operating losses incurred in 2018, 2019, and 2020 to be carried back to the five preceding taxable years in order to generate a refund of previously paid income taxes and (iv) enhancing the recoverability of alternative minimum tax credits. Given the Company’s full valuation allowance position and capitalization of all costs, the CARES Act did not have an impact on the financial statements. Net Income (Loss) per Common Share Net income (loss) per share is computed by dividing net income (loss) by the weighted-average number of shares of common stock outstanding during the period, excluding shares of common stock subject to forfeiture. At December 31, 2019, weighted average shares were reduced for the effect of an aggregate of 375,000 shares of common stock that were subject to forfeiture if the over-allotment option was not exercised by the underwriters (see Note 7). The Company has not considered the effect of the warrants sold in the Initial Public Offering and private placement to purchase an aggregate of 5,887,500 shares in the calculation of diluted loss per share, since the exercise of the warrants are contingent upon the occurrence of future events. The Company’s statement of operations includes a presentation of income (loss) per share for common shares subject to possible redemption in a manner similar to the two-class method of income (loss) per share. Net income (loss) per common share, basic and diluted, for Common stock subject to possible redemption is calculated by dividing the proportionate share of income or loss on marketable securities held by the Trust Account, net of applicable franchise and income taxes, by the weighted average number of Common stock subject to possible redemption outstanding since original issuance. Net income (loss) per share, basic and diluted, for non-redeemable common stock is calculated by dividing the net income (loss), adjusted for income or loss on marketable securities attributable to Common stock subject to possible redemption, by the weighted average number of non-redeemable common stock outstanding for the period. Non-redeemable common stock includes Founder Shares and non-redeemable shares of common stock as these shares do not have any redemption features. Non-redeemable common stock participates in the income or loss on marketable securities based on non-redeemable shares’ proportionate interest. The following table reflects the calculation of basic and diluted net income (loss) per common share (in dollars, except per share amounts): For the Period from February 13, 2019 Year Ended (inception) December 31, through 2020 December 31, 2019 Common stock subject to possible redemption Numerator: Earnings allocable to Common stock subject to possible redemption Interest earned on marketable securities held in Trust Account $ 5,785 $ — Unrealized gain on marketable securities held in Trust Account 828 — Less: interest available to be withdrawn for payment of taxes (6,613) — Net income $ — $ — Denominator: Weighted Average Common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Common stock subject to possible redemption 11,111,752 — Basic and diluted net income per share, Common stock subject to possible redemption $ 0.00 $ — Non-Redeemable Common Stock Numerator: Net Loss minus Net Earnings Net loss $ (103,385) $ (1,225) Net income allocable to Common stock subject to possible redemption — — Non-Redeemable Net Loss $ (103,385) $ (1,225) Denominator: Weighted Average Non-redeemable common stock Basic and diluted weighted average shares outstanding, Non-redeemable common stock 2,545,512 2,500,000 Basic and diluted net loss per share, Non-redeemable common stock $ (0.04) $ (0.00) Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist of a cash account in a financial institution, which, at times, may exceed the Federal Depository Insurance Coverage of $250,000. The Company has not experienced losses on this account. Fair Value of Financial Instruments The fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC 820, “Fair Value Measurement,” approximates the carrying amounts represented in the accompanying balance sheets, primarily due to their short-term nature. Recent Accounting Standards Management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s financial statements. |
PUBLIC OFFERING_2
PUBLIC OFFERING | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
PUBLIC OFFERING | ||
PUBLIC OFFERING | NOTE 3. PUBLIC OFFERING Pursuant to the Initial Public Offering, the Company sold 11,500,000 Units, which includes a full exercise by the underwriters of their over-allotment option in the amount of 1,500,000 Units, at a price of $10.00 per Unit. Each Unit consists of one share of common stock and one -half of one redeemable warrant (“Public Warrant”). Each whole Public Warrant entitles the holder to purchase one share of common stock at an exercise price of $11.50 per share, subject to adjustment (see Note 7). | NOTE 3 — PUBLIC OFFERING Pursuant to the Initial Public Offering, the Company sold 11,500,000 Units, which includes a full exercise by the underwriters of their over-allotment option in the amount of 1,500,000 Units, at a price of $10.00 per Unit. Each Unit consists of one share of common stock and one |
PRIVATE PLACEMENT_2
PRIVATE PLACEMENT | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
PRIVATE PLACEMENT | ||
PRIVATE PLACEMENT | NOTE 4. PRIVATE PLACEMENT Simultaneously with the closing of the Initial Public Offering, the Initial Stockholders purchased an aggregate of 275,000 Private Units at a price of $10.00 per Private Unit, for an aggregate purchase price of $2,750,000, in a private placement. Each Private Unit consists of one share of common stock (“Private Share”) and one -half of one redeemable warrant (“Private Warrant”). Each whole Private Warrant entitles the holder to purchase one share of common stock at a price of $11.50 per full share, subject to adjustment (see Note 7). The proceeds from the Private Units were added to the proceeds from the Initial Public Offering held in the Trust Account. If the Company does not complete a Business Combination within the Combination Period, the proceeds from the sale of the Private Units will be used to fund the redemption of the Public Shares (subject to the requirements of applicable law). | NOTE 4 — PRIVATE PLACEMENT Simultaneously with the closing of the Initial Public Offering, the Initial Stockholders purchased an aggregate of 275,000 Private Units at a price of $10.00 per Private Unit, for an aggregate purchase price of $2,750,000, in a private placement. Each Private Unit consists of one share of common stock (“Private Share”) and one-half of one |
RELATED PARTY TRANSACTIONS_2
RELATED PARTY TRANSACTIONS | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
RELATED PARTY TRANSACTIONS | ||
RELATED PARTY TRANSACTIONS | NOTE 5. RELATED PARTY TRANSACTIONS Founder Shares In February 2019, the Initial Stockholders purchased an aggregate of 100 shares of the Company’s common stock for an aggregate price of $25,000. On June 29, 2020, the Company effected a stock dividend of 43,125 shares of common stock for each share of common stock outstanding, resulting in an aggregate of 4,312,500 shares of common stock being held by the Initial Stockholders. On August 31, 2020, the Initial Stockholders transferred back to the Company 1,437,500 shares of common stock, for nominal consideration, which shares were cancelled, resulting in there being an aggregate of 2,875,000 shares of common stock outstanding and being held by the Initial Stockholders (the “Founder Shares”). That same day, CHLM Sponsor-1 LLC, an entity affiliated with Craig-Hallum Capital Group LLC, and certain of the Company’s directors, officers and affiliates of the Company’s management team purchased from CR Financial Holdings, Inc. an aggregate of 745,840 shares for an aggregate purchase price of $6,486. All share and per-share amounts have been retroactively restated to reflect the stock dividend and cancellation. The Founder’s Shares included an aggregate of up to 375,000 shares subject to forfeiture by the Sponsor to the extent that the underwriters’ over-allotment was not exercised in full or in part, so that the Sponsor would collectively own 20% of the Company’s issued and outstanding shares after the Initial Public Offering (excluding the Private Shares underlying the Private Securities). As a result of the underwriters’ election to fully exercise their over-allotment option, no Founder Shares are currently subject to forfeiture. The Initial Stockholders have agreed, subject to certain limited exceptions, not to transfer, assign or sell any of the Founder Shares until (1) with respect to 50% of the Founder Shares, the earlier of six months after the completion of a Business Combination and the date on which the closing price of the common stock equals or exceeds $12.50 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30 - trading day period commencing after a Business Combination and (2) with respect to the remaining 50% of the Founder Shares, six months after the completion of a Business Combination, or earlier, in either case, if, subsequent to a Business Combination, the Company completes a liquidation, merger, stock exchange or other similar transaction which results in all of the Company’s stockholders having the right to exchange their shares of common stock for cash, securities or other property. Promissory Note — Related Party On August 23, 2020, the Company issued an unsecured promissory note to the sponsor (the “Promissory Note”), pursuant to which the Company may borrow up to an aggregate principal amount of $200,000. The Promissory Note is non-interest bearing and payable on the earlier of (i) the consummation of the Initial Public Offering or (ii) the date on which the Company determines not to proceed with the Initial Public Offering. The outstanding balance under the Promissory Note of $200,000 was repaid at the closing of the Initial Public Offering on December 15, 2020. Related Party Loans In addition, in order to finance transaction costs in connection with a Business Combination, the Initial Stockholders, or certain of the Company’s officers and directors or their affiliates may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). If the Company completes a Business Combination, the Company would repay the Working Capital Loans out of the proceeds of the Trust Account released to the Company. Otherwise, the Working Capital Loans would be repaid only out of funds held outside the Trust Account. In the event that a Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans, but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. Except for the foregoing, the terms of such Working Capital Loans, if any, have not been determined and no written agreements exist with respect to such loans. The Working Capital Loans would be repaid upon consummation of a Business Combination, without interest. | NOTE 5 — RELATED PARTY TRANSACTIONS Founder Shares In February 2019, the Initial Stockholders purchased an aggregate of 100 shares of the Company’s common stock for an aggregate price of $25,000. On June 29, 2020, the Company effected a stock dividend of 43,125 shares of common stock for each share of common stock outstanding, resulting in an aggregate of 4,312,500 shares of common stock being held by the Initial Stockholders. On August 31, 2020, the Initial Stockholders transferred back to the Company 1,437,500 shares of common stock, for nominal consideration, which shares were cancelled, resulting in there being an aggregate of 2,875,000 shares of common stock outstanding and being held by the Initial Stockholders (the “Founder Shares”). That same day, CHLM Sponsor-1 LLC, an entity affiliated with Craig-Hallum Capital Group LLC, and certain of the Company’s directors, officers and affiliates of the Company’s management team purchased from CR Financial Holdings, Inc. an aggregate of 745,840 shares for an aggregate purchase price of $6,486. All share and per-share amounts have been retroactively restated to reflect the stock dividend and cancellation. The Founder’s Shares included an aggregate of up to 375,000 shares subject to forfeiture by the Sponsor to the extent that the underwriters’ over-allotment was not exercised in full or in part, so that the Sponsor would collectively own 20% of the Company’s issued and outstanding shares after the Initial Public Offering (excluding the Private Shares underlying the Private Securities). As a result of the underwriters’ election to fully exercise their over-allotment option, no Founder Shares are currently subject to forfeiture. The Initial Stockholders have agreed, subject to certain limited exceptions, not to transfer, assign or sell any of the Founder Shares until (1) with respect to 50% of the Founder Shares, the earlier of six months after the completion of a Business Combination and the date on which the closing price of the common stock equals or exceeds $12.50 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing after a Business Combination and (2) with respect to the remaining 50% of the Founder Shares, six months after the completion of a Business Combination, or earlier, in either case, if, subsequent to a Business Combination, the Company completes a liquidation, merger, stock exchange or other similar transaction which results in all of the Company’s stockholders having the right to exchange their shares of common stock for cash, securities or other property. Promissory Note — Related Party On August 23, 2020, the Company issued an unsecured promissory note to the sponsor (the “Promissory Note”), pursuant to which the Company may borrow up to an aggregate principal amount of $200,000. The Promissory Note is non-interest bearing and payable on the earlier of (i) the consummation of the Initial Public Offering or (ii) the date on which the Company determines not to proceed with the Initial Public Offering. The outstanding balance under the Promissory Note of $200,000 was repaid at the closing of the Initial Public Offering on December 15, 2020. Related Party Loans In addition, in order to finance transaction costs in connection with a Business Combination, the Initial Stockholders, or certain of the Company’s officers and directors or their affiliates may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). If the Company completes a Business Combination, the Company would repay the Working Capital Loans out of the proceeds of the Trust Account released to the Company. Otherwise, the Working Capital Loans would be repaid only out of funds held outside the Trust Account. In the event that a Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans, but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. Except for the foregoing, the terms of such Working Capital Loans, if any, have not been determined and no written agreements exist with respect to such loans. The Working Capital Loans would be repaid upon consummation of a Business Combination, without interest. |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
COMMITMENTS AND CONTINGENCIES | ||
COMMITMENTS AND CONTINGENCIES | NOTE 6. COMMITMENTS AND CONTINGENCIES Registration Rights Pursuant to a registration rights agreement entered into on December 10, 2020, the holders of the Founder Shares, as well as the holders of the Private Units (and underlying securities) and any securities issued to the Initial Stockholders, officers, directors or their affiliates in payment of Working Capital Loans made to Company, will be entitled to registration rights. The holders of a majority of these securities are entitled to make up to two demands that the Company register such securities. The holders of the majority of the Founder Shares can elect to exercise these registration rights at any time commencing three months prior to the date on which these shares of common stock are to be released from escrow. The holders of a majority of the Private Units (and underlying securities) and securities issued in payment of Working Capital Loans (or underlying securities) can elect to exercise these registration rights at any time after the Company consummates a Business Combination. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to consummation of a Business Combination. The registration rights agreement does not contain liquidating damages or other cash settlement provisions resulting from delays in registering the Company’s securities. The Company will bear the expenses incurred in connection with the filing of any such registration statements. Notwithstanding the foregoing, the Company may not exercise demand or piggyback rights after five (5) and seven (7) years, respectively, from the effective date of the Initial Public Offering and may not exercise demand rights on more than one occasion in respect of all registrable securities. Underwriting Agreement The underwriters were paid a cash underwriting discount of 1.00% of the gross proceeds of the Initial Public Offering, or $1,150,000. Business Combination Marketing Agreement The Company entered into a business combination marketing agreement with the representatives of the underwriters as advisors in connection with a Business Combination. The Company will pay the representatives of the underwriters a marketing fee for such services upon the consummation of a Business Combination in an amount equal to, in the aggregate, 4.5% of the gross proceeds of the Initial Public Offering, including any proceeds from the full or partial exercise of the underwriters’ over-allotment option. As a result, the representatives of the underwriters will not be entitled to such fee unless the Company consummates its initial business combination. | NOTE 6 — COMMITMENTS AND CONTINGENCIES Registration Rights Pursuant to a registration rights agreement entered into on December 10, 2020, the holders of the Founder Shares, as well as the holders of the Private Units (and underlying securities) and any securities issued to the Initial Stockholders, officers, directors or their affiliates in payment of Working Capital Loans made to Company, will be entitled to registration rights. The holders of a majority of these securities are entitled to make up to two demands that the Company register such securities. The holders of the majority of the Founder Shares can elect to exercise these registration rights at any time commencing three months prior to the date on which these shares of common stock are to be released from escrow. The holders of a majority of the Private Units (and underlying securities) and securities issued in payment of Working Capital Loans (or underlying securities) can elect to exercise these registration rights at any time after the Company consummates a Business Combination. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to consummation of a Business Combination. The registration rights agreement does not contain liquidating damages or other cash settlement provisions resulting from delays in registering the Company’s securities. The Company will bear the expenses incurred in connection with the filing of any such registration statements. Notwithstanding the foregoing, the Company may not exercise demand or piggyback rights after five (5) and seven (7) years, respectively, from the effective date of the Initial Public Offering and may not exercise demand rights on more than one occasion in respect of all registrable securities. Underwriting Agreement The underwriters were paid a cash underwriting discount of 1.00% of the gross proceeds of the Initial Public Offering, or $1,150,000. Business Combination Marketing Agreement The Company entered into a business combination marketing agreement with the representatives of the underwriters as advisors in connection with a Business Combination. The Company will pay the representatives of the underwriters a marketing fee for such services upon the consummation of a Business Combination in an amount equal to, in the aggregate, 4.5% of the gross proceeds of the Initial Public Offering, including any proceeds from the full or partial exercise of the underwriters’ over-allotment option. As a result, the representatives of the underwriters will not be entitled to such fee unless the Company consummates its initial business combination. |
STOCKHOLDERS' EQUITY_2
STOCKHOLDERS' EQUITY | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
STOCKHOLDERS' EQUITY | ||
STOCKHOLDERS' EQUITY | NOTE 7 — STOCKHOLDERS’ EQUITY Common Stock — issued outstanding | NOTE 7 — STOCKHOLDERS’ EQUITY Common Stock issued outstanding Warrants effective registration statement and during any period when the Company shall have failed to maintain an effective registration statement, exercise warrants on a cashless basis pursuant to an available exemption from registration under the Securities Act. The warrants will expire five years from the closing of a Business Combination. Once the warrants become exercisable, the Company may redeem the Public Warrants: ● in whole and not in part; ● at a price of $ 0.01 per warrant; ● at any time after the warrants become exercisable; ● upon not less than 30 days ’ prior written notice of redemption to each warrant holder; ● if, and only if, the reported last sale price of the shares of common stock equals or exceeds $ 18.00 per share, for any 20 trading days within a 30 - day trading period commencing after the warrants become exercisable and ending on the third business day prior to the notice of redemption to warrant holders; and ● if, and only if, there is a current registration statement in effect with respect to the shares of common stock underlying such warrants at the time of redemption and for the entire 30-day trading period referred to above and continuing each day thereafter until the date of redemption. If the Company calls the Public Warrants for redemption, management will have the option to require all holders that wish to exercise the Public Warrants to do so on a “cashless basis,” as described in the warrant agreement. The exercise price and number of shares of common stock issuable on exercise of the warrants may be adjusted in certain circumstances including in the event of a stock dividend, extraordinary dividend or our recapitalization, reorganization, merger or consolidation. However, except as described below, the warrants will not be adjusted for issuances of shares of common stock at a price below their respective exercise prices. Additionally, in no event will the Company be required to net cash settle the warrants. If the Company is unable to complete a Business Combination within the Combination Period and the Company liquidates the funds held in the Trust Account, holders of warrants will not receive any of such funds with respect to their warrants, nor will they receive any distribution from the Company’s assets held outside of the Trust Account with the respect to such warrants. Accordingly, the warrants may expire worthless. In addition, if (x) the Company issues additional shares of common stock or equity-linked securities for capital raising purposes in connection with the closing of a Business Combination at an issue price or effective issue price of less than $9.20 per share of common stock (with such issue price or effective issue price to be determined in good faith by the Company’s board of directors, and in the case of any such issuance to the Initial Stockholders or their affiliates, without taking into account any Founder Shares held by them prior to such issuance), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of a Business Combination on the date of the consummation of a Business Combination (net of redemptions), and (z) the volume weighted average trading price of the Company’s common stock during the 20 trading day period starting on the trading day prior to the day on which the Company consummates Business Combination (such price, the “Market Value”) is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the Market Value and the $18.00 per share redemption trigger price described above will be adjusted (to the nearest cent) to be equal to 180% of the Market Price. The Private Warrants are identical to the Public Warrants underlying the Units sold in the Initial Public Offering, except that the Private Warrants and the shares of common stock issuable upon the exercise of the Private Warrants will not be transferable, assignable or saleable until after the completion of a Business Combination, subject to certain limited exceptions. Additionally, the Private Warrants will be exercisable for cash or on a cashless basis, at the holder’s option, and be non-redeemable so long as they are held by the initial purchasers or their permitted transferees. If the Private Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants. |
INCOME TAX
INCOME TAX | 12 Months Ended |
Dec. 31, 2020 | |
INCOME TAX | |
INCOME TAX | NOTE 8 — INCOME TAX The Company’s net deferred tax assets are as follows: December 31, December 31, 2020 2019 Deferred tax assets Net operating loss carryforward $ 17,142 $ 257 Unrealized gain on marketable securities (1,389) — Startup and organizational costs 6,215 — Total deferred tax assets 21,968 257 Valuation Allowance (21,968) (257) Deferred tax assets $ — $ — The income tax provision consists of the following: December 31, December 31, 2020 2019 Federal Current $ — $ — Deferred (21,711) (257) State and Local Current — — Deferred — — Change in valuation allowance 21,711 257 Income tax provision $ — $ — As of December 31, 2020 and 2019, the Company had $104,610 and $1,225, respectively of U.S. federal net operating loss carryovers available to offset future taxable income. In assessing the realization of the deferred tax assets, management considers whether it is more likely than not that some portion of all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which temporary differences representing net future deductible amounts become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. After consideration of all of the information available, management believes that significant uncertainty exists with respect to future realization of the deferred tax assets and has therefore established a full valuation allowance. For the year ended December 31, 2020, the change in the valuation allowance was $21,711. A reconciliation of the federal income tax rate to the Company’s effective tax rate is as follows: December 31, December 31, 2020 2019 Statutory federal income tax rate 21.0 % 21.0 % State taxes, net of federal tax benefit 0.0 % 0.0 % Meals and entertainment 0.0 % 0.0 % Valuation allowance (21.0) (21.0) Income tax provision 0.0 % 0.0 % The Company files income tax returns in the U.S. federal jurisdiction and is subject to examination by the various taxing authorities. The Company’s tax returns since inception remain open to examination by the taxing authorities. The Company considers California to be a significant state tax jurisdiction. |
FAIR VALUE MEASUREMENTS_2
FAIR VALUE MEASUREMENTS | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
FAIR VALUE MEASUREMENTS | ||
FAIR VALUE MEASUREMENTS | NOTE 9. FAIR VALUE MEASUREMENTS The Company follows the guidane in ASC 820 for its financial assets and liabilities that are re-measured and reported at fair value at each reporting period, and non-financial assets and liabilities that are re-measured and reported at fair value at least annually. The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities: Level 1: Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2: Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active. Level 3: Unobservable inputs based on our assessment of the assumptions that market participants would use in pricing the asset or liability. The following table presents information about the Company’s assets that are measured at fair value on a recurring basis at March 31, 2021, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value: March 31, December 31, Description Level 2021 2020 Assets: Marketable securities held in Trust Account 1 $ 115,012,821 $ 115,006,613 Liabilities Warrant liabilities – Private Placement Warrants 3 $ 178,750 $ 129,250 The Warrants were accounted for as liabilities in accordance with ASC 815-40 and are presented within warrant liabilities on our accompanying March 31, 2021 condensed balance sheet. The warrant liabilities are measured at fair value at inception and on a recurring basis, with changes in fair value presented within change in fair value of warrant liabilities in the condensed statement of operations. The Warrants were valued using a binomial lattice model incorporating the Cox-Ross-Rubenstein methodology, which is considered to be a Level 3 fair value measurement. The binomial lattice model’s primary unobservable input utilized in determining the fair value of the Warrants is the expected volatility of the common stock. The expected volatility as of the IPO date was derived from observable public warrant pricing on comparable ‘blank-check’ companies without an identified target. The expected volatility as of subsequent valuation dates was implied from the Company’s own public warrant pricing. There were no transfers between The following table provides quantitative information regarding Level 3 fair value measurements: At As of December 31, March 31, 2020 2021 Stock price $ 9.54 $ 9.91 Strike price $ 11.50 $ 11.50 Volatility 17.5% 19.1% Risk-free rate 0.41% 0.94% Probability of Business Combination occurring 75% 75% Dividend yield 0.0% 0.0% Fair value of warrants $ 0.94 $ 1.30 The following table presents the changes in the fair value of warrant liabilities: Warrant Liabilities Fair value as of December 31, 2020 $ 129,250 Change in valuation inputs or other assumptions 49,500 Fair value as of March 31, 2021 178,750 | NOTE 9 — FAIR VALUE MEASUREMENTS The Company follows the guidance in ASC 820 for its financial assets and liabilities that are re-measured and reported at fair value at each reporting period, and non-financial assets and liabilities that are re-measured and reported at fair value at least annually. The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities: Level 1: Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2: Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active. Level 3: Unobservable inputs based on our assessment of the assumptions that market participants would use in pricing the asset or liability. The following table presents information about the Company’s assets that are measured at fair value on a recurring basis at December 31, 2020, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value: December 31, Description Level 2020 Assets: Cash and marketable securities held in Trust Account 1 $ 115,006,613 |
SUBSEQUENT EVENTS_2
SUBSEQUENT EVENTS | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
SUBSEQUENT EVENTS | ||
SUBSEQUENT EVENTS | NOTE 11. SUBSEQUENT EVENTS The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the condensed financial statements were issued. Based upon this review, other than as described in Note 9 and below, the Company did not identify any subsequent events that would have required adjustment or disclosure in the condensed financial statements. On April 14, 2021, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Roth CH II Merger SubCorp. (“Merger Sub”) and Reservoir Holdings, Inc. (“Reservoir”). Pursuant to the terms of the Merger Agreement, the business combination (the “Business Combination”) between the Company and Reservoir will be effected through the merger of Merger Sub with and into Reservoir (the “Merger”), with Reservoir surviving the Merger as a wholly owned subsidiary of the Company. The Business Combination is subject to customary conditions to closing, including receipt of approval of the Company’s stockholders and the concurrent closing of a $150 million private placement of the Company’s common stock to certain institutional and accredited investors. There can be no assurance that such conditions will be satisfied or that the Business Combination will be consummated on the terms contemplated by the Merger Agreement. | NOTE 10 — SUBSEQUENT EVENTS The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the financial statements were issued. Based upon this review, other than as described below, the Company did not identify any subsequent events that would have required adjustment or disclosure in the financial statements. On February 15, 2021, the Company entered into a mutually exclusive non-binding letter of intent (the “Letter of Intent”) with a target company (“Target Company”) for a potential business combination which would qualify as its initial business combination (the “Business Combination”). Under the terms of the Letter of Intent, the Company and Target Company intend to enter into a definitive agreement pursuant to which the Company and Target Company would combine, with the former equity holders of both entities (following the completion of the Business Combination) holding equity in the combined publicly listed company. The completion of the Business Combination is subject to the completion of due diligence to the Company’s satisfaction, the negotiation and execution of definitive documentation and satisfaction of the conditions contained therein, including (i) completion of any required stock exchange and regulatory review and (ii) approval of the transaction by the Company’s stockholders and the Target Company’s stockholders. Accordingly, no assurances can be made by either party that the parties will successfully negotiate and enter into a definitive agreement, or that the proposed transaction will be consummated. |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X of the Securities and Exchange Commission (the “SEC”). Certain information or footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows. In the opinion of management, the accompanying unaudited condensed financial statements include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented. The accompanying unaudited condensed financial statements should be read in conjunction with the Company’s Annual report on Form 10-K, as filed with the SEC on March 29, 2021. The interim results for the three months ended March 31, 2021 are not necessarily indicative of the results to be expected for the period ending December 31, 2021 or for any future periods. | Basis of Presentation The accompanying financial statements are presented in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the SEC. |
Emerging Growth Company | Emerging Growth Company The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used. | Emerging Growth Company The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates. | Use of Estimates The preparation of financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The Company did not have any cash equivalents as of March 31, 2021 and 2020. | Cash and Cash Equivalents The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The Company did not have any cash equivalents as of December 31, 2020 and 2019. |
Marketable Securities Held in Trust Account | Marketable Securities Held in Trust Account December 31, 2020 substantially all of the assets held in the Trust Account were held in U.S. Treasury Bills. | Marketable Securities Held in Trust Account December 31, 2020 substantially all of the assets held in the Trust Account were held in U.S. Treasury Bills. |
Common Stock Subject to Possible Redemption | Common Stock Subject to Possible Redemption The Company accounts for its common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Common stock subject to mandatory redemption is classified as a liability instrument and is measured at fair value. Conditionally redeemable common stock (including common stock that features redemption rights that is either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) is classified as temporary equity. At all other times, common stock is classified as stockholders’ equity. The Company’s common stock features certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, at December 31, 2020, common stock subject to possible redemption is presented at redemption value as temporary equity, outside of the stockholders’ equity section of the Company’s balance sheets. | Common Stock Subject to Possible Redemption The Company accounts for its common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Common stock subject to mandatory redemption is classified as a liability instrument and is measured at fair value. Conditionally redeemable common stock (including common stock that features redemption rights that is either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) is classified as temporary equity. At all other times, common stock is classified as stockholders’ equity. The Company’s common stock features certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, at December 31, 2020, common stock subject to possible redemption is presented at redemption value as temporary equity, outside of the stockholders’ equity section of the Company’s balance sheets. |
Warrant Liability | Warrant Liability The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 480, Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own ordinary shares, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding. For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded at their initial fair value on the date of issuance, and each balance sheet date thereafter. Changes in the estimated fair value of the warrants are recognized as a non-cash gain or loss on the statements of operations. The fair value of the warrants was estimated using a Binomial Lattice Model (see Note 9). | |
Income Taxes | Income Taxes The Company follows the asset and liability method of accounting for income taxes under ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of March 31, 2021 and December 31, 2020. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company is subject to income tax examinations by major taxing authorities since inception. The effective tax rate differs from the statutory tax rate of 21% for the three months ended March 31, 2021 and 2020, due to the valuation allowance recorded on the Company’s net operating losses. | Income Taxes The Company follows the asset and liability method of accounting for income taxes under ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of December 31, 2020 and 2019. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company is subject to income tax examinations by major taxing authorities since inception. On March 27, 2020, the CARES Act was enacted in response to COVID-19 pandemic. Under ASC 740, the effects of changes in tax rates and laws are recognized in the period which the new legislation is enacted. The CARES Act made various tax law changes including among other things (i) increasing the limitation under Section 163(j) of the Internal Revenue Code of 1986, as amended (the “IRC”) for 2019 and 2020 to permit additional expensing of interest (ii) enacting a technical correction so that qualified improvement property can be immediately expensed under IRC Section 168(k), (iii) making modifications to the federal net operating loss rules including permitting federal net operating losses incurred in 2018, 2019, and 2020 to be carried back to the five preceding taxable years in order to generate a refund of previously paid income taxes and (iv) enhancing the recoverability of alternative minimum tax credits. Given the Company’s full valuation allowance position and capitalization of all costs, the CARES Act did not have an impact on the financial statements. |
Net income (Loss) per Common Share | Net income (Loss) per Common Share Net income (loss) per share is computed by dividing net income (loss) by the weighted-average number of shares of common stock outstanding during the period, excluding shares of common stock subject to forfeiture. The Company has not considered the effect of the warrants sold in the Initial Public Offering and private placement to purchase an aggregate of 5,887,500 shares in the calculation of diluted loss per share, since the exercise of the warrants are contingent upon the occurrence of future events. The Company’s statement of operations includes a presentation of income (loss) per share for common shares subject to possible redemption in a manner similar to the two-class method of income (loss) per share. Net income (loss) per common share, basic and diluted, for Common stock subject to possible redemption is calculated by dividing the proportionate share of income or loss on marketable securities held by the Trust Account, net of applicable franchise and income taxes, by the weighted average number of Common stock subject to possible redemption outstanding since original issuance. Net income (loss) per share, basic and diluted, for non-redeemable common stock is calculated by dividing the net income (loss), adjusted for income or loss on marketable securities attributable to Common stock subject to possible redemption, by the weighted average number of non-redeemable common stock outstanding for the period. Non-redeemable common stock includes Founder Shares and non-redeemable shares of common stock as these shares do not have any redemption features. Non-redeemable common stock participates in the income or loss on marketable securities based on non-redeemable shares’ proportionate interest. The following table reflects the calculation of basic and diluted net income (loss) per common share (in dollars, except per share amounts): Three Months Three Months Ended Ended March 31, March 31, 2021 2020 Common stock subject to possible redemption Numerator: Earnings allocable to Common stock subject to possible redemption Interest earned on marketable securities held in Trust Account $ 5,973 $ — Unrealized gain on marketable securities held in Trust Account — — Less: interest available to be withdrawn for payment of taxes (5,973) — Net income $ — $ — Denominator: Weighted Average Common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Common stock subject to possible redemption 11,088,616 — Basic and diluted net income per share, Common stock subject to possible redemption $ 0.00 $ — Non-Redeemable Common Stock Numerator: Net Loss minus Net Earnings Net loss $ (247,531) $ (85) Net income allocable to Common stock subject to possible redemption — — Non-Redeemable Net Loss $ (247,531) $ (85) Denominator: Weighted Average Non-redeemable common stock — — Basic and diluted weighted average shares outstanding, Non-redeemable common stock 3,561,384 2,500,000 Basic and diluted net loss per share, Non-redeemable common stock $ (0.07) $ (0.00) | Net Income (Loss) per Common Share Net income (loss) per share is computed by dividing net income (loss) by the weighted-average number of shares of common stock outstanding during the period, excluding shares of common stock subject to forfeiture. At December 31, 2019, weighted average shares were reduced for the effect of an aggregate of 375,000 shares of common stock that were subject to forfeiture if the over-allotment option was not exercised by the underwriters (see Note 7). The Company has not considered the effect of the warrants sold in the Initial Public Offering and private placement to purchase an aggregate of 5,887,500 shares in the calculation of diluted loss per share, since the exercise of the warrants are contingent upon the occurrence of future events. The Company’s statement of operations includes a presentation of income (loss) per share for common shares subject to possible redemption in a manner similar to the two-class method of income (loss) per share. Net income (loss) per common share, basic and diluted, for Common stock subject to possible redemption is calculated by dividing the proportionate share of income or loss on marketable securities held by the Trust Account, net of applicable franchise and income taxes, by the weighted average number of Common stock subject to possible redemption outstanding since original issuance. Net income (loss) per share, basic and diluted, for non-redeemable common stock is calculated by dividing the net income (loss), adjusted for income or loss on marketable securities attributable to Common stock subject to possible redemption, by the weighted average number of non-redeemable common stock outstanding for the period. Non-redeemable common stock includes Founder Shares and non-redeemable shares of common stock as these shares do not have any redemption features. Non-redeemable common stock participates in the income or loss on marketable securities based on non-redeemable shares’ proportionate interest. The following table reflects the calculation of basic and diluted net income (loss) per common share (in dollars, except per share amounts): For the Period from February 13, 2019 Year Ended (inception) December 31, through 2020 December 31, 2019 Common stock subject to possible redemption Numerator: Earnings allocable to Common stock subject to possible redemption Interest earned on marketable securities held in Trust Account $ 5,785 $ — Unrealized gain on marketable securities held in Trust Account 828 — Less: interest available to be withdrawn for payment of taxes (6,613) — Net income $ — $ — Denominator: Weighted Average Common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Common stock subject to possible redemption 11,111,752 — Basic and diluted net income per share, Common stock subject to possible redemption $ 0.00 $ — Non-Redeemable Common Stock Numerator: Net Loss minus Net Earnings Net loss $ (103,385) $ (1,225) Net income allocable to Common stock subject to possible redemption — — Non-Redeemable Net Loss $ (103,385) $ (1,225) Denominator: Weighted Average Non-redeemable common stock Basic and diluted weighted average shares outstanding, Non-redeemable common stock 2,545,512 2,500,000 Basic and diluted net loss per share, Non-redeemable common stock $ (0.04) $ (0.00) |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash accounts in a financial institution, which, at times may exceed the Federal Depository Insurance Coverage of $250,000. The Company has not experienced losses on these accounts. | Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist of a cash account in a financial institution, which, at times, may exceed the Federal Depository Insurance Coverage of $250,000. The Company has not experienced losses on this account. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC Topic 820, “Fair Value Measurement,” approximates the carrying amounts represented in the accompanying condensed balance sheets, primarily due to their short-term nature. Fair Value Measurements Fair value is defined as the price that would be received for sale of an asset or paid for transfer of a liability, in an orderly transaction between market participants at the measurement date. GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). These tiers include: ● Level 1, defined as observable inputs such as quoted prices (unadjusted) for identical instruments in active markets; ● Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and ● Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. In some circumstances, the inputs used to measure fair value might be categorized within different levels of the fair value hierarchy. In those instances, the fair value measurement is categorized in its entirety in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement. Derivative Financial Instruments The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives in accordance with ASC Topic 815, “Derivatives and Hedging”. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value on the grant date and is then re-valued at each reporting date, with changes in the fair value reported in the statements of operations. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement or conversion of the instrument could be required within 12 months of the balance sheet date. | Fair Value of Financial Instruments The fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC 820, “Fair Value Measurement,” approximates the carrying amounts represented in the accompanying balance sheets, primarily due to their short-term nature. |
Recent Accounting Standards | Recent Accounting Standards Management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s condensed financial statements. | Recent Accounting Standards Management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s financial statements. |
SUMMARY OF SIGNIFICANT ACCOUN_8
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Reconciliation of Net Loss per Common Share | Three Months Three Months Ended Ended March 31, March 31, 2021 2020 Common stock subject to possible redemption Numerator: Earnings allocable to Common stock subject to possible redemption Interest earned on marketable securities held in Trust Account $ 5,973 $ — Unrealized gain on marketable securities held in Trust Account — — Less: interest available to be withdrawn for payment of taxes (5,973) — Net income $ — $ — Denominator: Weighted Average Common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Common stock subject to possible redemption 11,088,616 — Basic and diluted net income per share, Common stock subject to possible redemption $ 0.00 $ — Non-Redeemable Common Stock Numerator: Net Loss minus Net Earnings Net loss $ (247,531) $ (85) Net income allocable to Common stock subject to possible redemption — — Non-Redeemable Net Loss $ (247,531) $ (85) Denominator: Weighted Average Non-redeemable common stock — — Basic and diluted weighted average shares outstanding, Non-redeemable common stock 3,561,384 2,500,000 Basic and diluted net loss per share, Non-redeemable common stock $ (0.07) $ (0.00) | For the Period from February 13, 2019 Year Ended (inception) December 31, through 2020 December 31, 2019 Common stock subject to possible redemption Numerator: Earnings allocable to Common stock subject to possible redemption Interest earned on marketable securities held in Trust Account $ 5,785 $ — Unrealized gain on marketable securities held in Trust Account 828 — Less: interest available to be withdrawn for payment of taxes (6,613) — Net income $ — $ — Denominator: Weighted Average Common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Common stock subject to possible redemption 11,111,752 — Basic and diluted net income per share, Common stock subject to possible redemption $ 0.00 $ — Non-Redeemable Common Stock Numerator: Net Loss minus Net Earnings Net loss $ (103,385) $ (1,225) Net income allocable to Common stock subject to possible redemption — — Non-Redeemable Net Loss $ (103,385) $ (1,225) Denominator: Weighted Average Non-redeemable common stock Basic and diluted weighted average shares outstanding, Non-redeemable common stock 2,545,512 2,500,000 Basic and diluted net loss per share, Non-redeemable common stock $ (0.04) $ (0.00) |
INCOME TAX (Tables)
INCOME TAX (Tables) | 12 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | |
INCOME TAX | ||
Schedule of Company's net deferred tax assets | Significant components of the Company’s deferred income tax liability at March 31 are as follows: 2021 2020 $ $ Deferred tax assets: Net operating loss carryforward 785,902 481,360 Fair value of swaps 1,046,459 1,718,059 Compensation 44,375 20,682 Charitable contributions 8,951 — Unrealized foreign exchange losses 51,924 — Total deferred tax assets 1,937,611 2,220,101 Deferred tax liabilities: Fixed assets and leasehold improvements (44,393) (72,006) Intangible assets (21,628,755) (18,563,334) Deferred charges — — Total deferred tax liabilities (21,673,148) (18,635,340) Net deferred tax liabilities (19,735,537) (16,415,239) | December 31, December 31, 2020 2019 Deferred tax assets Net operating loss carryforward $ 17,142 $ 257 Unrealized gain on marketable securities (1,389) — Startup and organizational costs 6,215 — Total deferred tax assets 21,968 257 Valuation Allowance (21,968) (257) Deferred tax assets $ — $ — |
Schedule of components of income tax provision (benefit) | December 31, December 31, 2020 2019 Federal Current $ — $ — Deferred (21,711) (257) State and Local Current — — Deferred — — Change in valuation allowance 21,711 257 Income tax provision $ — $ — | |
Schedule of reconciliation of the statutory federal income tax rate (benefit) to the Company's effective tax rate (benefit) | A reconciliation of the statutory tax rate to the effective rate is as follows for the fiscal years ended March 31: 2021 2020 Federal income tax statutory rate 21.0 % 21.0 % State and local income taxes, net of federal income tax benefit 1.7 % 1.4 % Foreign subsidiary earnings 2.1 % 0.4 % Return to provision adjustments (4.9) % (1.5) % Impact of change in tax rates 0.3 % 8.2 % Other, net (1.0) % 0.1 % Effective income tax rate 19.2 % 29.6 % | December 31, December 31, 2020 2019 Statutory federal income tax rate 21.0 % 21.0 % State taxes, net of federal tax benefit 0.0 % 0.0 % Meals and entertainment 0.0 % 0.0 % Valuation allowance (21.0) (21.0) Income tax provision 0.0 % 0.0 % |
FAIR VALUE MEASUREMENTS (Tabl_2
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
FAIR VALUE MEASUREMENTS | ||
Schedule of company's assets that are measured at fair value on a recurring basis | March 31, December 31, Description Level 2021 2020 Assets: Marketable securities held in Trust Account 1 $ 115,012,821 $ 115,006,613 Liabilities Warrant liabilities – Private Placement Warrants 3 $ 178,750 $ 129,250 | December 31, Description Level 2020 Assets: Cash and marketable securities held in Trust Account 1 $ 115,006,613 |
Schedule of quantitative information regarding Level 3 fair value measurements inputs | At As of December 31, March 31, 2020 2021 Stock price $ 9.54 $ 9.91 Strike price $ 11.50 $ 11.50 Volatility 17.5% 19.1% Risk-free rate 0.41% 0.94% Probability of Business Combination occurring 75% 75% Dividend yield 0.0% 0.0% Fair value of warrants $ 0.94 $ 1.30 | |
Schedule of change in the fair value of the warrant liabilities | Warrant Liabilities Fair value as of December 31, 2020 $ 129,250 Change in valuation inputs or other assumptions 49,500 Fair value as of March 31, 2021 178,750 |
DESCRIPTION OF ORGANIZATION A_4
DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS (Details) - USD ($) | Dec. 15, 2020 | Mar. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Subsidiary, Sale of Stock [Line Items] | ||||
Number of units sold | 275,000 | |||
Transaction Costs | $ 1,654,977 | |||
Underwriting fees | 1,150,000 | |||
Other offering costs | $ 504,977 | |||
Cash held outside the Trust Account | $ 549,040 | $ 696,567 | $ 25,000 | |
Payments for investment of cash in Trust Account | $ 115,000,000 | |||
Threshold minimum aggregate fair market value as percentage of assets held in Trust Account | 80.00% | |||
Threshold minimum aggregate fair market value as percentage of assets held in Trust Account | 80.00% | |||
Threshold percentage of outstanding voting securities of the target to be acquired by post-transaction company to complete business combination | 50.00% | 50.00% | ||
Minimum net tangible assets upon consummation of the Business Combination | $ 5,000,001 | $ 5,000,001 | ||
Obligation to redeem Public Shares if entity does not complete a Business Combination (as a percent) | 100.00% | 100.00% | ||
Redemption period upon closure | 10 days | 5 days | ||
Initial Public Offering | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Number of units sold | 11,500,000 | 11,500,000 | ||
Share price per Unit | $ 10 | $ 10 | ||
Proceeds from issuance initial public offering | $ 115,000,000 | |||
Payments for investment of cash in Trust Account | $ 115,000,000 | |||
Private Placement | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Number of units sold | 275,000 | |||
Sale of Private Placement Warrants (in shares) | 275,000 | |||
Price of warrant | $ 10 | |||
Proceeds from sale of Private Placement Warrants | $ 2,750,000 | |||
Private Placement | Private Placement Warrants | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Sale of Private Placement Warrants (in shares) | 275,000 | 275,000 | ||
Price of warrant | $ 10 | $ 10 | ||
Proceeds from sale of Private Placement Warrants | $ 2,750,000 | $ 2,750,000 | ||
Over-allotment option | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Number of units sold | 1,500,000 | |||
Share price per Unit | $ 10 |
SUMMARY OF SIGNIFICANT ACCOUN_9
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) | 3 Months Ended | 11 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||||
Cash equivalents | $ 0 | $ 0 | ||
Unrecognized tax benefits | $ 0 | $ 0 | 0 | |
Unrecognized tax benefits accrued for interest and penalties | $ 0 | $ 0 | ||
Statutory tax rate (as a percent) | 21.00% | 21.00% | 21.00% | 21.00% |
Common stock, shares subject to possible redemption | 375,000 | |||
Warrants excluded from calculation of EPS | 5,887,500 | 5,887,500 | ||
FDIC Insured Amount | $ 250,000 |
SUMMARY OF SIGNIFICANT ACCOU_10
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Reconciliation of Net income (Loss) per Common Share (Details) - USD ($) | 3 Months Ended | 11 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | |
Numerator: Earnings allocable to Common stock subject to possible redemption | ||||
Interest earned on marketable securities held in Trust Account | $ 5,973 | $ 5,785 | ||
Unrealized gain on marketable securities held in Trust Account | 828 | |||
Less: interest available to be withdrawn for payment of taxes | $ (5,973) | (6,613) | ||
Denominator: Weighted Average Common stock subject to possible redemption | ||||
Weighted average shares outstanding, basic and diluted | 11,088,616 | |||
Basic and diluted net loss per common share | $ 0 | |||
Numerator: Net Loss minus Net Earnings | ||||
Net income attributable to Reservoir Holdings Inc. | $ (247,531) | $ (85) | $ (1,225) | $ (103,385) |
Non-Redeemable Net Loss | $ (247,531) | $ (85) | ||
Common Class Subject To Redemption Member | ||||
Denominator: Weighted Average Common stock subject to possible redemption | ||||
Weighted average shares outstanding, basic and diluted | 11,111,752 | |||
Basic and diluted net loss per common share | $ 0 | |||
Numerator: Net Loss minus Net Earnings | ||||
Net income attributable to Reservoir Holdings Inc. | $ (1,225) | $ (103,385) | ||
Class A Common Stock Subject to Redemption | ||||
Denominator: Weighted Average Common stock subject to possible redemption | ||||
Weighted average shares outstanding, basic and diluted | 11,088,616 | |||
Basic and diluted net loss per common share | $ 0 | $ 0 | ||
Class A Common Stock Not Subject to Redemption | ||||
Denominator: Weighted Average Common stock subject to possible redemption | ||||
Weighted average shares outstanding, basic and diluted | 3,561,384 | 2,500,000 | 2,500,000 | 2,545,512 |
Basic and diluted net loss per common share | $ (0.07) | $ 0 | $ 0 | $ (0.04) |
Class B Common Stock | ||||
Numerator: Net Loss minus Net Earnings | ||||
Non-Redeemable Net Loss | $ (1,225) | $ (103,385) |
PUBLIC OFFERING (Details)_2
PUBLIC OFFERING (Details) - $ / shares | Dec. 15, 2020 | Dec. 31, 2020 | Mar. 31, 2021 |
Subsidiary, Sale of Stock [Line Items] | |||
Number of units sold | 275,000 | ||
Initial Public Offering | |||
Subsidiary, Sale of Stock [Line Items] | |||
Number of units sold | 11,500,000 | 11,500,000 | |
Purchase price, per unit | $ 10 | $ 10 | |
Initial Public Offering | Public Warrants | |||
Subsidiary, Sale of Stock [Line Items] | |||
Number of shares in a unit | 1 | ||
Number of warrants in a unit | 0.5 | ||
Number of shares issuable per warrant | 1 | ||
Exercise price of warrants | $ 11.50 | ||
Over-allotment option | |||
Subsidiary, Sale of Stock [Line Items] | |||
Number of units sold | 1,500,000 | ||
Purchase price, per unit | $ 10 |
PRIVATE PLACEMENT (Details)_2
PRIVATE PLACEMENT (Details) - Private Placement - USD ($) | Dec. 15, 2020 | Mar. 31, 2021 |
Subsidiary, Sale of Stock [Line Items] | ||
Number of warrants to purchase shares issued | 275,000 | |
Price of warrants | $ 10 | |
Aggregate purchase price | $ 2,750,000 | |
Private Placement Warrants | ||
Subsidiary, Sale of Stock [Line Items] | ||
Number of warrants to purchase shares issued | 275,000 | 275,000 |
Price of warrants | $ 10 | $ 10 |
Aggregate purchase price | $ 2,750,000 | $ 2,750,000 |
Number of shares in a unit | 1 | 1 |
Number of warrants in a unit | 0.5 | 0.5 |
Number of shares per warrant | 1 | 1 |
Exercise price of warrant | $ 11.50 | $ 11.50 |
RELATED PARTY TRANSACTIONS - _2
RELATED PARTY TRANSACTIONS - Founder Shares (Details) - USD ($) | Aug. 31, 2020 | Jun. 29, 2020 | Aug. 31, 2020 | Feb. 28, 2019 | Mar. 31, 2021 | Dec. 31, 2019 | Dec. 31, 2020 |
Related Party Transaction [Line Items] | |||||||
Aggregate purchase price | $ 25,000 | ||||||
Sponsor | |||||||
Related Party Transaction [Line Items] | |||||||
Aggregate purchase price | $ 6,486 | $ 6,486 | |||||
Aggregate number of shares owned | 745,840 | 745,840 | |||||
Shares subject to forfeiture | 375,000 | 375,000 | |||||
Percentage of issued and outstanding shares after the Initial Public Offering collectively held by initial stockholders | 20.00% | 20.00% | |||||
Founder Shares | |||||||
Related Party Transaction [Line Items] | |||||||
Number of shares issued | 100 | ||||||
Aggregate purchase price | $ 25,000 | ||||||
Share dividend | 43,125 | ||||||
Aggregate number of shares owned | 2,875,000 | 4,312,500 | 2,875,000 | ||||
Number of shares transferred back to the company | 1,437,500 | 1,437,500 | |||||
Percentage of transfer of founder shares based on certain exceptions | 50.00% | 50.00% | |||||
Stock price trigger to transfer, assign or sell any shares or warrants of the company, after the completion of the initial business combination (in dollars per share) | $ 12.50 | $ 12.50 | |||||
Threshold trading days for transfer, assign or sale of shares or warrants, after the completion of the initial business combination | 20 days | 20 days | |||||
Threshold consecutive trading days for transfer, assign or sale of shares or warrants, after the completion of the initial business combination | 30 days | 30 days |
RELATED PARTY TRANSACTIONS - _3
RELATED PARTY TRANSACTIONS - Additional Information (Details) - USD ($) | Dec. 15, 2020 | Dec. 31, 2020 | Aug. 23, 2020 |
Related Party Transaction [Line Items] | |||
Maximum borrowing capacity of related party promissory note | $ 200,000 | ||
Repayment of promissory note - related party | $ 200,000 | $ 200,000 | |
Promissory Note with Related Party | |||
Related Party Transaction [Line Items] | |||
Maximum borrowing capacity of related party promissory note | $ 200,000 | ||
Repayment of promissory note - related party | $ 200,000 |
COMMITMENTS AND CONTINGENCIES_3
COMMITMENTS AND CONTINGENCIES (Details) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021USD ($)item | Dec. 31, 2020USD ($)item | |
COMMITMENTS AND CONTINGENCIES | ||
Maximum number of demands for registration of securities | item | 2 | 2 |
Cash underwriting discount as a percent of gross offering proceeds | 1.00% | 1.00% |
Aggregate deferred underwriting fee payable | $ | $ 1,150,000 | $ 1,150,000 |
Marketing fee as percent of gross offering proceeds | 4.50% | 4.50% |
STOCKHOLDERS' EQUITY - Common_2
STOCKHOLDERS' EQUITY - Common Stock Shares (Details) - $ / shares | Mar. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Class of Stock [Line Items] | |||
Common shares, shares authorized (in shares) | 50,000,000 | 50,000,000 | 50,000,000 |
Common stock, shares, par value | $ 0.0001 | $ 0.0001 | $ 0.0001 |
Common shares, shares issued (in shares) | 3,586,137 | 3,548,459 | 2,875,000 |
Common shares, shares outstanding (in shares) | 3,586,137 | 3,548,459 | 2,875,000 |
Common stock subject to possible redemption (in shares) | 11,063,863 | 11,101,541 | 11,101,541 |
Temporary equity, shares issued | 11,063,863 | 11,101,541 | 11,101,541 |
Common stock subject to redemption | |||
Class of Stock [Line Items] | |||
Common stock subject to possible redemption (in shares) | 0 | 0 |
STOCKHOLDERS' EQUITY - Warrants
STOCKHOLDERS' EQUITY - Warrants (Details) - Public Warrants | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021$ / shares | Dec. 31, 2020$ / shares | |
Class of Warrant or Right [Line Items] | ||
Public Warrants exercisable term after the completion of a business combination | 30 days | 30 days |
Number of days of which warrants will not be effective from the date of business combination | 120 days | 120 days |
Public Warrants expiration term | 5 years | 5 years |
Issue price per share | $ 9.20 | $ 9.20 |
Percentage of gross new proceeds to total equity proceeds used to measure dilution of warrant | 60 | 60 |
Trading period after business combination used to measure dilution of warrant | 20 days | |
Warrant exercise price adjustment multiple | 115 | 115 |
Warrant redemption price adjustment multiple | 180 | 180 |
Redemption of Warrants When the Price per Class A Ordinary Share Equals or Exceeds $18.00 | ||
Class of Warrant or Right [Line Items] | ||
Redemption price per public warrant (in dollars per share) | $ 0.01 | $ 0.01 |
Redemption period | 30 days | 30 days |
Threshold trading days for redemption of public warrants | 20 days | 20 days |
Threshold consecutive trading days for redemption of public warrants | 30 days | 30 days |
Stock price trigger for redemption of public warrants (in dollars per share) | $ 18 | $ 18 |
INCOME TAXES - Deferred tax ass
INCOME TAXES - Deferred tax assets (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred tax assets | ||
Net operating loss carryforward | $ 17,142 | $ 257 |
Unrealized gain on marketable securities | (1,389) | |
Startup and organizational costs | 6,215 | |
Total deferred tax assets | 21,968 | 257 |
Valuation Allowance | $ (21,968) | $ (257) |
INCOME TAXES - Income tax provi
INCOME TAXES - Income tax provision (Details) - USD ($) | 11 Months Ended | 12 Months Ended |
Dec. 31, 2019 | Dec. 31, 2020 | |
Federal | ||
Deferred | $ (257) | $ (21,711) |
State and local | ||
Change in valuation allowance | 257 | 21,711 |
U.S. Federal net operating loss carryovers | $ 1,225 | $ 104,610 |
INCOME TAXES - Effective tax ra
INCOME TAXES - Effective tax rate (Details) new | 3 Months Ended | 11 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | |
INCOME TAX | ||||
Federal income tax statutory rate | 21.00% | 21.00% | 21.00% | 21.00% |
State taxes, net of federal tax benefit | 0.00% | 0.00% | ||
Meals and entertainment | 0.00% | 0.00% | ||
Valuation allowance | (21.00%) | (21.00%) | ||
Effective income tax rate | 0.00% | 0.00% |
FAIR VALUE MEASUREMENTS (Deta_2
FAIR VALUE MEASUREMENTS (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | |
Assets: | ||
Cash and marketable securities held in Trust Account | $ 115,012,821 | $ 115,006,613 |
Liabilities | ||
Warrant liabilities | 178,750 | |
Transfer of assets from level 1 to level 2 | 0 | |
Transfer of assets from level 2 to level 1 | 0 | |
Transfers to / from level 3 | 0 | |
Level 1 | Recurring | ||
Assets: | ||
Cash and marketable securities held in Trust Account | $ 115,012,821 | $ 115,006,613 |
SUBSEQUENT EVENTS (Details)_2
SUBSEQUENT EVENTS (Details) $ in Millions | Apr. 14, 2021USD ($) |
Merger Agreement | Subsequent event | |
Subsequent Event [Line Items] | |
Concurrent closing of private placement | $ 150 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Reservoir Holdings Inc And Subsidiaries | ||
Revenues | $ 81,777,789 | $ 63,238,672 |
Costs and expenses: | ||
Cost of Revenue | 32,991,979 | 27,305,489 |
Amortization and depreciation | 14,128,604 | 8,423,197 |
Administration expenses | 14,986,085 | 12,032,673 |
Total costs and expenses | 62,106,668 | 47,761,359 |
Operating income | 19,671,121 | 15,477,313 |
Interest expense | (8,972,100) | (6,463,381) |
(Loss) gain on foreign exchange | (910,799) | 30,700 |
Gain (loss) on fair value of swaps | 2,988,322 | (5,555,702) |
Interest and other income | 13,243 | 76,894 |
Gain on retirement of RMM Issuer debt | 10,644,084 | |
Income before income taxes | 12,789,787 | 14,209,908 |
Income tax expense | 2,454,153 | 4,199,141 |
Net income | 10,335,634 | 10,010,767 |
Net (income) loss attributable to noncontrolling interests | (46,673) | 47,027 |
Net income attributable to Reservoir Holdings Inc. | $ 10,288,961 | $ 10,057,794 |
Earnings per common share (Note 14): | ||
Basic | $ 45.29 | $ 51.38 |
Diluted | $ 45.29 | $ 51.38 |
Weighted average common shares outstanding (Note 14): | ||
Basic | 144,698 | 128,875 |
Diluted | 227,198 | 195,740 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Reservoir Holdings Inc And Subsidiaries | ||
Net income | $ 10,335,634 | $ 10,010,767 |
Other comprehensive loss: | ||
Translation adjustments | 6,481,973 | (1,981,753) |
Total comprehensive income | 16,817,607 | 8,029,014 |
Comprehensive (income) loss attributable to noncontrolling interests | (46,673) | 47,027 |
Total comprehensive income attributable to Reservoir Holdings, Inc. | $ 16,770,934 | $ 8,076,041 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Mar. 31, 2021 | Mar. 31, 2020 |
Current assets | ||
Cash and cash equivalents | $ 549,040 | |
Total current assets | 929,595 | |
Total assets | 115,942,416 | |
Current liabilities | ||
Total current liabilities | 125,034 | |
Contingencies and commitments (Note 16) | ||
Shareholders' Equity | ||
Common stock, $0.00001 par value; 1,000,000 shares authorized, 145,560 shares issued and outstanding at March 31, 2021; and 140,227 shares issued and outstanding at March 31, 2020 | 359 | |
Additional Paid-in Capital | 5,370,137 | |
Retained earnings (accumulated deficit) | (370,494) | |
Total Reservoir Holdings Inc. shareholders' equity | 5,000,002 | |
Total liabilities and shareholders' equity | 115,942,416 | |
Reservoir Holdings Inc And Subsidiaries | ||
Current assets | ||
Cash and cash equivalents | 9,209,920 | $ 58,240,123 |
Accounts receivable | 15,813,384 | 9,745,206 |
Amounts due from related parties (Note 11) | 5,671 | |
Current portion of royalty advances | 12,840,855 | 13,845,419 |
Inventory and prepaid expenses | 1,406,379 | 431,029 |
Total current assets | 39,270,538 | 82,267,448 |
Intangible assets, net | 393,238,010 | 285,109,108 |
Investment in equity affiliates | 1,591,179 | 1,498,399 |
Royalty advances, net of current portion | 28,741,225 | 26,418,020 |
Property, plant and equipment, net | 321,766 | 602,976 |
Other assets | 781,735 | 695,252 |
Total assets | 463,944,453 | 396,591,203 |
Current liabilities | ||
Accounts payable and accrued liabilities | 3,316,768 | 876,144 |
Royalties payable | 14,656,566 | 12,169,249 |
Accrued payroll | 1,634,852 | 1,532,047 |
Deferred revenue | 1,337,987 | 473,022 |
Other current liabilities | 2,615,488 | 7,089,780 |
Amounts due to related parties (Note 11) | 290,172 | |
Current portion of loans and secured notes payable | 1,000,000 | 1,000,000 |
Income taxes payable | 533,495 | 297,112 |
Total current liabilities | 25,385,328 | 23,437,354 |
Loans and secured notes payable | 211,531,875 | 171,785,432 |
Deferred income taxes | 19,735,537 | 16,415,239 |
Fair value of swaps | 4,566,537 | 7,554,859 |
Other liabilities | 6,739,971 | 6,306,430 |
Total liabilities | 267,959,248 | 225,499,314 |
Shareholders' Equity | ||
Preferred stock, $0.00001 par value 500,000 shares authorized; 82,500 shares issued and outstanding at March 31, 2021 and 2020 | 81,632,500 | 81,632,500 |
Common stock, $0.00001 par value; 1,000,000 shares authorized, 145,560 shares issued and outstanding at March 31, 2021; and 140,227 shares issued and outstanding at March 31, 2020 | 1 | 1 |
Additional Paid-in Capital | 110,499,153 | 102,423,444 |
Retained earnings (accumulated deficit) | 751,496 | (9,537,465) |
Accumulated other comprehensive income (loss) | 2,096,358 | (4,385,615) |
Total Reservoir Holdings Inc. shareholders' equity | 194,979,508 | 170,132,865 |
Noncontrolling interest | 1,005,697 | 959,024 |
Total shareholders' equity | 195,985,205 | 171,091,889 |
Total liabilities and shareholders' equity | $ 463,944,453 | $ 396,591,203 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2021 | Mar. 31, 2020 |
Common stock, shares, par value | $ 0.0001 | |
Common stock, shares, authorized | 50,000,000 | |
Common stock, shares, issued | 3,586,137 | |
Common stock, shares, Outstanding | 3,586,137 | |
Reservoir Holdings Inc And Subsidiaries | ||
Preferred stock, shares, par value | $ 0.00001 | $ 0.00001 |
Preferred stock, shares, authorized | 500,000 | |
Preferred stock, shares, issued | 82,500 | 82,500 |
Preferrred stock, shares, Outstanding | 82,500 | 82,500 |
Common stock, shares, par value | $ 0.00001 | $ 0.00001 |
Common stock, shares, authorized | 1,000,000 | 1,000,000 |
Common stock, shares, issued | 145,560 | 140,227 |
Common stock, shares, Outstanding | 145,560 | 140,227 |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - Reservoir Holdings Inc And Subsidiaries - USD ($) | Preferred Stock | Common Stock | Additional Paid-In Capital | Retained earnings (Accumulated deficit) | Accumulated other comprehensive income (loss) | Noncontrolling interest | Total |
Beginning balance at Mar. 31, 2019 | $ 1 | $ 104,250,000 | $ (19,595,259) | $ (2,403,862) | $ 82,250,880 | ||
Beginning balance (in shares) at Mar. 31, 2019 | 125,227 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Common share dividend | (16,875,000) | (16,875,000) | |||||
Issuance of preferred shares | $ 81,632,500 | 81,632,500 | |||||
Issuance of preferred shares (in shares) | 82,500 | ||||||
Issuance of common shares | 14,957,500 | 14,957,500 | |||||
Issuance of common shares (in shares) | 15,000 | ||||||
Share-based compensation | 90,944 | 90,944 | |||||
Net income (loss) | 10,057,794 | $ (47,027) | 10,010,767 | ||||
Other comprehensive income (loss) | (1,981,753) | (1,981,753) | |||||
Acquisition of noncontrolling interests | 1,006,051 | 1,006,051 | |||||
Ending balance at Mar. 31, 2020 | $ 81,632,500 | $ 1 | 102,423,444 | (9,537,465) | (4,385,615) | 959,024 | 171,091,889 |
Ending balance (in shares) at Mar. 31, 2020 | 82,500 | 140,227 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of common shares | 7,973,009 | 7,973,009 | |||||
Issuance of common shares (in shares) | 5,333 | ||||||
Share-based compensation | 102,700 | 102,700 | |||||
Net income (loss) | 10,288,961 | 46,673 | 10,335,634 | ||||
Other comprehensive income (loss) | 6,481,973 | 6,481,973 | |||||
Ending balance at Mar. 31, 2021 | $ 81,632,500 | $ 1 | $ 110,499,153 | $ 751,496 | $ 2,096,358 | $ 1,005,697 | $ 195,985,205 |
Ending balance (in shares) at Mar. 31, 2021 | 82,500 | 145,560 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Amortization of intangible assets | $ 13,906,199 | $ 8,250,305 |
Cash flows from financing activities: | ||
Cash, cash equivalents and restricted cash beginning of year | 24,690 | |
Cash and cash equivalents end of year | 549,040 | 24,690 |
Reservoir Holdings Inc And Subsidiaries | ||
Net income | 10,335,634 | 10,010,767 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Amortization of intangible assets | 13,906,199 | 8,250,305 |
Depreciation of property, plant and equipment | 222,405 | 172,892 |
Share-based compensation | 102,700 | 90,944 |
Gain on retirement of RMM Issuer debt | (10,644,084) | |
Non-cash interest charges | 795,212 | 674,331 |
(Gain) loss on fair value of derivative instruments | (2,988,322) | 5,555,703 |
Share of earnings of equity affiliates, net of tax | 7,089 | (4,407) |
Deferred income tax | 2,080,622 | 3,651,234 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 6,068,178 | 532,805 |
Inventory and prepaid expenses | 975,350 | 203,929 |
Royalty advances | 1,318,641 | 6,912,500 |
Other assets | 138,706 | (103,595) |
Accounts payable and accrued expenses | 213,335 | (1,684,961) |
Income tax payable | 236,383 | 182,911 |
Net cash provided by operating activities | 16,246,946 | 11,881,542 |
Cash flows from investing activities: | ||
Purchases of music catalogs | 119,966,806 | 106,841,628 |
Business combination and investment in equity affiliate | 13,366 | 380,417 |
Increase (decrease) in deferred music composition acquisition costs | (86,483) | (54,386) |
Purchase of property, plant and equipment | (79,901) | (529,950) |
Net cash used for investing activities | (120,146,556) | (107,806,381) |
Cash flows from financing activities: | ||
Common stock dividend paid | (16,875,000) | |
Issuance of preferred shares, net of issuance costs | 81,632,500 | |
Issuance of common shares, net of issuance costs | 7,973,009 | 14,957,500 |
Repayment of secured notes | (1,625,000) | |
Proceeds from secured line of credit | 40,600,000 | 20,000,000 |
Repayment of secured line of credit | (7,076,870) | |
Proceeds from secured loans | (236,490,849) | |
Repayments of secured loans | (1,000,000) | (178,247,825) |
Deferred financing costs paid | (648,769) | (2,149,017) |
Repayments of related party loans | (77,496) | |
Draw on related party loans | 295,843 | |
Net cash provided by financing activities | 47,220,083 | 147,029,641 |
Foreign exchange impact on cash | 7,649,324 | (1,981,753) |
(Decrease) increase in cash, cash equivalents and restricted cash | (49,030,203) | 49,123,049 |
Cash, cash equivalents and restricted cash beginning of year | 58,240,123 | 9,117,074 |
Cash and cash equivalents end of year | $ 9,209,920 | $ 58,240,123 |
Description of business
Description of business | 12 Months Ended |
Mar. 31, 2021 | |
Reservoir Holdings Inc And Subsidiaries | |
Subsidiary, Sale of Stock [Line Items] | |
Description of business | 1. Description of business Reservoir Holdings Inc. (the “Company”) was incorporated on April 23, 2019 under the laws of Delaware for the sole purpose of serving as the holding company of Reservoir Media Management, Inc. (“RMM”). On that date a reorganization transaction was completed, whereby RMM’s sole shareholder contributed its 100% equity interest in RMM to the Company in exchange for 100% of the Company’s common stock, and RMM became a wholly-owned subsidiary of the Company. Since the Company and RMM were entities under common control, this exchange of common stock resulted in a change in reporting entity with the retrospective combination of RMM and the Company for all periods presented as if the combination had been in effect since the inception of common control. As the Company had no assets or operations prior to its formation and the reorganization transaction, the historical financial statements of RMM are presented as the historical financial statements of the combined entity. On March 16, 2020, the Company amended its certificate of incorporation to effect a 1-for-100 RMM commenced operations on April 27, 2007 and the activities of RMM are organized into two operating segments: Music Publishing and Recorded Music. Operations of the Music Publishing segment involve the acquisition of interests in music catalogs from which royalties are earned. The publishing catalog includes ownership or control rights to more than 130,000 musical compositions that span across historic pieces, motion picture scores and current award-winning hits. Operations of the Recorded Music segment involve the discovery and development of recording artists and the marketing, distribution, sale and licensing of the music catalog. The Recorded Music operations are primarily conducted through the Chrysalis Records platform and include the ownership of over 26,000 sound recordings. The Company’s operations are concentrated primarily in the U.S. and UK and, to a lesser degree, United Arab Emirates. COVID-19 Pandemic In March 2020, the World Health Organization characterized the coronavirus (“COVID-19”) as a pandemic, and the President of the United States declared the COVID-19 outbreak a national emergency. The rapid spread of COVID-19 and the continuously evolving responses to combat it have had a negative impact on the global economy. The Company has evaluated and continues to evaluate the potential impact of the COVID-19 pandemic on its consolidated financial statements. Government-imposed restrictions and general behavioral changes in response to the pandemic adversely affected the Company’s results of operations for the fiscal year ended March 31, 2021. This included performance revenue generated from retail, restaurants, bars, gyms and live shows, synchronization revenue, and the release schedule of physical product. Even as government restrictions are lifted and consumer behavior starts to return to pre-pandemic norms, it is unclear for how long and to what extent the Company’s operations will continue to be affected. Although the Company has not made material changes to any estimates or judgments that impact its consolidated financial statements as a result of COVID-19, the extent to which the COVID-19 pandemic may impact the Company will depend on future developments, which are highly uncertain and cannot be predicted. Future developments could negatively affect the Company’s operating results, including reductions in revenue and cash flow and could impact the Company’s impairment assessments of accounts receivable or intangible assets, which may be material to our consolidated financial statements. Paycheck Protection Program Loan During the fiscal year ended March 31, 2021 (“fiscal 2021”), the Company borrowed $616,847 under the Paycheck Protection Program (“PPP”) (the “PPP Loan”). The PPP, established as part of the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”), provided for loans to qualifying businesses for amounts up to 2.5 times of the average monthly payroll expenses of the qualifying business. The loans and accrued interest are forgivable after as long as the borrower uses the loan proceeds for eligible purposes, including payroll, benefits, rent and utilities, and maintains its payroll levels. In accordance with the terms of the program, the Company applied for and received confirmation of loan forgiveness for the entire amount borrowed under the PPP. The Company accounted for the PPP Loan as an in-substance government grant because it expected to meet the PPP Loan eligibility criteria and concluded that the loan represented, in substance, a grant that was expected to be forgiven. Proceeds from the PPP Loan were initially recognized as a deferred income liability and presented as an operating activity within the Company’s consolidated statement of cash flows. Subsequently, the Company reduced this liability and recognized a reduction in payroll expenses on a systematic basis over the period in which the related costs for which the PPP Loan was intended were incurred. No interest for the PPP Loan was recognized in the Company’s financial statements. |
Summary of significant accou_11
Summary of significant accounting policies | 12 Months Ended |
Mar. 31, 2021 | |
Reservoir Holdings Inc And Subsidiaries | |
Summary of significant accounting policies | 2. Summary of significant accounting policies Basis of presentation These consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”). In the opinion of management, all adjustments considered necessary for a fair presentation have been included. The following include significant accounting policies that have been adopted by the Company: (a) Principles of consolidation The consolidated financial statements include the accounts of the Company, its wholly-owned subsidiaries and its majority-owned subsidiaries. The Company records a noncontrolling interest in its consolidated balance sheets and statements of operations with respect to the remaining economic interests in majority-owned subsidiaries it does not own. All intercompany transactions and balances have been eliminated upon consolidation. The equity method of accounting is used to account for investments in entities in which the Company has the ability to exert significant influence over the investee’s operating and financial polices. As of March 31, 2021 and 2020, the Company was not involved with any entities identified as variable interest entities. (b) Use of significant accounting estimates The preparation of consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and the related disclosure of contingent assets and liabilities. Significant estimates are used for, but not limited to, determining useful lives of intangible assets, intangible asset recoverability and impairment and accrued revenue. Actual results could differ from these estimates. (c) Foreign currencies The Company has determined the U.S. dollar to be the functional currency of the Company and certain subsidiaries as it is the currency of the primary economic environment in which the companies operate while other subsidiaries have been determined to have the British Pound as their functional currencies. (i) Transactions and balances Monetary assets and liabilities denominated in foreign currencies other than the functional currency are translated into the respective functional currencies at the exchange rate in effect at the balance sheet date and non-monetary assets and liabilities at the exchange rates in effect at the time of acquisition or issue. Revenues and expenses are translated at rates approximating the exchange rates in effect at the time of the transactions. All exchange gains and losses are included in operations. (ii) Translation Financial statements of subsidiaries with functional currencies other than the U.S. dollar are translated into the presentation currency using the current rate method. Under this method, assets and liabilities are translated at the rate of exchange in effect at the balance sheet date. Revenue and expenses are translated at the average rate of exchange for the fiscal year. Exchange gains and losses are deferred and reflected on the balance sheet in accumulated other comprehensive income and subsequently recognized in income upon substantial disposal of the net investment in the foreign operation. (d) Cash and cash equivalents The Company considers all highly liquid investments with maturities of three months or less at the date of purchase to be cash equivalents. (e) Restricted cash Prior to their repurchase, pursuant to the terms of the indenture agreement in connection with the issuance of secured notes, RMM Issuer, a subsidiary of the Company, was required to maintain a trust account in the name of the indenture trustee (the “Trustee”) into which royalty payments received, advances and other collections were required to be deposited after deduction of the applicable writer’s share. On a semi-annual basis, the Trustee distributed the amounts collected to various interested parties as fees for services or, in the case of secured note holders, for the payment of interest and principal. This arrangement was terminated upon the Company’s purchase of the secured notes on April 2, 2019 (see Note 7). (f) Accounts receivable Credit is extended to customers based upon an evaluation of the customer’s financial condition. The time between the Company’s issuance of an invoice and payment due date is not significant. Customer payments that are not collected in advance of the transfer of promised services or goods are generally due 30-60 days from invoice date. The Company monitors customer credit risk related to accounts receivable and, when deemed necessary, maintains a provision for estimated uncollectible accounts, which is estimated based on historical experience, aging trends and in certain cases, management judgments about specific customers. Based on this analysis, the Company did not record a provision for estimated uncollectible accounts at March 31, 2021 or 2020. (g) Concentrations of credit risk Customer credit risk represents the potential for financial loss if a customer is unwilling or unable to meet its agreed upon contractual payment obligations. Two customers accounted for approximately 43% of total accounts receivable at March 31, 2021 and three customers accounted for approximately 67% of total accounts receivable at March 31, 2020. No other single customer accounted for more than 10% of accounts receivable in either period. In the Music Publishing business, the Company collects a significant portion of its royalties from global copyright collecting societies. Collecting societies and associations generally are not-for-profit organizations that represent composers, songwriters and music publishers. These organizations seek to protect the rights of their members by licensing, collecting license fees and distributing royalties for the use of the members’ works. The Company does not believe there is any significant collection risk from such societies. In the Recorded Music business, the majority of the revenue is collected from the Company’s distribution partners rather than directly from many customers. Those distribution partners pay through the revenue to the Company on a monthly basis. The Company routinely assesses the financial strength of its distribution partners and the Company does not believe there is any significant collection risk. (h) Acquisitions and business combinations In conjunction with each acquisition transaction, the Company assesses whether the transaction should follow accounting guidance applicable to an asset acquisition or a business combination. This assessment requires an evaluation of whether the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets, resulting in an asset acquisition or, if not, resulting in a business combination. If treated as an asset acquisition, the asset is recorded in accordance with the Company’s intangible asset policy and related acquisition costs are capitalized as part of the asset. In a business combination, the Company recognizes identifiable assets acquired, liabilities assumed, and non-controlling interests at their fair values at the acquisition date. Any consideration paid in excess of the net fair value of the identifiable assets and liabilities acquired in a business combination is recorded to goodwill and acquisition-related costs are expensed as incurred. (i) Intangible assets Intangible assets consist primarily of music catalogs (publishing and recorded). Intangible assets are recorded at fair value in a business combination and relative fair value in an asset acquisition. Intangible assets are amortized over their expected useful lives using the straight-line method. The Company periodically reviews the carrying value of its amortizable intangible assets, whenever events or changes in circumstances indicate that the carrying value may not be recoverable or that the lives assigned may no longer be appropriate. To the extent the estimated future cash inflows attributable to the asset, less estimated future cash outflows, are less than the carrying amount, an impairment loss is recognized in an amount equal to the difference between the carrying value of such asset and its fair value. If it is determined that events and circumstances warrant a revision to the remaining period of amortization, an asset’s remaining useful life would be changed, and the remaining carrying amount of the asset would be amortized prospectively over that revised remaining useful life. (j) Goodwill The Company has $402,067 of goodwill at March 31, 2021 and 2020, which is classified with Other assets in the Company’s consolidated balance sheet. All of the goodwill arose in connection with an acquisition on December 29, 2019 (see Note 4) and has been assigned to a reporting unit within the Music Publishing segment. There was no impairment, disposals, or other acquisitions of goodwill in the fiscal years ended March 31, 2021 and 2020. Goodwill represents the future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. The Company evaluates goodwill for potential impairment on an annual basis on the first day of the fiscal fourth quarter (January 1), or at other times during the year if events or circumstances indicate that it is more-likely-than-not (greater than 50%) that the fair value of a reporting unit, is below the carrying amount. In reviewing goodwill for impairment, the Company has the option to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more-likely-than-not that the estimated fair value of a reporting unit is less than its carrying amount. If the Company elects to bypass the qualitative assessment for any reporting unit, or if a qualitative assessment indicates it is more-likely-than-not that the estimated fair value of a reporting unit is less than its carrying amount, the Company performs a quantitative goodwill impairment test by comparing the fair value of the reporting unit with its carrying amount. If the fair value of the reporting unit is less than its carrying amount, the Company will measure any goodwill impairment loss as the amount by which the carrying amount of a reporting unit exceeds its fair value, not to exceed the total amount of goodwill allocated to that reporting unit. (k) Investments in equity affiliates The Company holds 50% interests in two (l) Deferred revenue Deferred revenue principally relates to fixed fees and minimum guarantees received in advance of the Company’s performance or usage by the licensee. Reductions in deferred revenue are a result of the Company’s performance under the contract or usage by the licensee. (m) Deferred finance costs Deferred finance costs consist of costs incurred in connection with the issuance of secured notes payable and bank loans and are amortized on an effective interest basis over the original term of the related obligation. Deferred finance charges are netted against the debt (see Note 7). (n) Deferred charges Deferred charges consist of direct costs incurred in connection with the potential acquisition of entertainment interests in music compositions pursued by the Company. Such costs are deferred when closing of the transaction is deemed probable and are added to the cost of the asset once acquired or expensed if the acquisition does not proceed. (o) Revenues The Company recognizes revenue when, or as, control of the promised services or goods is transferred to its customers and in an amount that reflects the consideration the Company is contractually due in exchange for those services or goods. Music Publishing Music Publishing revenues are earned in the form of royalties relating to the licensing of rights in musical compositions and the sale of published sheet music and songbooks. Royalties principally relate to amounts earned from the public performance of musical compositions, the mechanical reproduction of musical compositions on recorded media including digital formats and the use of musical compositions in synchronization with visual images. Music publishing royalties, except for synchronization royalties, are recognized when the sale or usage occurs. The most common form of consideration for publishing contracts is sales- and usage-based royalties. The collecting societies submit usage reports, typically with payment for royalties due, often on a quarterly or biannual reporting period, in arrears. Royalties are recognized as the sale or usage occurs based upon usage reports when these reports are available for the reporting period or estimates of royalties based on historical data, such as recent royalties reported, company-specific information with respect to changes in repertoire, industry information and other relevant trends when usage reports are not available for the reporting period. Synchronization revenue is recognized as revenue when control of the license is transferred to the customer. Recorded Music Revenues from the sale or license of Recorded Music products through digital distribution channels are recognized when the sale or usage occurs based on usage reports received from the customer. Digital licensing contracts are generally long-term with consideration in the form of sales- and usage-based royalties that are received monthly. For certain licenses where the consideration is fixed and the intellectual property being licensed is static, revenue is recognized at the point in time when control of the licensed content is transferred to the customer. Revenues from the sale of physical Recorded Music products are recognized upon delivery, which occurs once the product has been shipped and control has been transferred. (p) Principal versus agent revenue recognition The Company reports revenue on a gross or net basis based on management’s assessment of whether the Company acts as a principal or agent in the transaction. The determination of whether the Company acts as a principal or an agent in a transaction is based on an evaluation of whether the Company controls the good or service before transfer to the customer. When the Company concludes that it controls the good or service before transfer to the customer, the Company is considered a principal in the transaction and records revenue on a gross basis. When the Company concludes that it does not control the good or service before transfer to the customer but arranges for another entity to provide the good or service, the Company acts as an agent and records revenue on a net basis in the amount it earns for its agency service. The Company is typically required to pay a specified portion of the fees, earnings, payments and revenues received from the exploitation of the underlying music compositions to the original songwriter (“Royalty Costs”). The Company records revenues on a gross basis reflecting its position as a principal in the transaction and any royalties payable to third parties, including the Writer’s Fees, are recorded as expenses. (q) Royalty costs and royalty advances The Company incurs royalty costs that are payable to its recording artists and songwriters generated from the sale or license of its music publishing copyrights and recorded music catalog. Royalties are calculated using negotiated rates in accordance with recording artist and songwriter contracts. Calculations are based on revenue earned or user/usage measures or a combination of these. There are instances where such data is not available to be processed and royalty cost calculations may be complex or involve judgments about significant volumes of data to be processed and analyzed. In many instances, the Company commits to pay its recording artists and songwriters royalties in advance of future sales. The Company accounts for these advances under the related guidance in FASB ASC Topic 928, Entertainment — Music (“ASC 928”). Under ASC 928, the Company capitalizes as assets certain advances, which it believes are recoverable from future royalties to be earned by the recording artist or songwriter, when paid. Recoverability is assessed upon initial commitment of the advance based upon the Company’s forecast of anticipated revenue from the sale of future and existing albums or musical compositions. In determining whether the advance is recoverable, the Company evaluates the current and past popularity of the recording artist or songwriter, the sales history of the recording artist or songwriter, the initial or expected commercial acceptability of the product, the current and past popularity of the genre of music that the product is designed to appeal to, and other relevant factors. Advances vary in both amount and expected life based on the underlying recording artist or songwriter. To the extent that a portion of an outstanding advance is no longer deemed recoverable, that amount will be expensed in the period the determination is made. (r) Share-based compensation Compensation expense related to the issuance of share-based awards to the Company’s employees is measured at fair value on the grant date. We use the Black-Scholes option pricing model to value stock options. The compensation expense for awards that vest over a future service period is recognized over the requisite service period on a straight-line basis. The Company recognizes share-based award forfeitures as they occur rather than estimating by applying a forfeiture rate. (s) Earnings per share The consolidated statements of income present basic and diluted earnings per share (“EPS”). Basic earnings per share is computed using the two-class method which includes the weighted average number of shares of common stock outstanding during the period and other securities that participate in dividends (a “participating security”). Since the Preferred Shares (as defined in Note 12) participate in dividends alongside the Company’s common shares, the Preferred Shares constitute participating securities. Under the two-class method, all earnings (distributed and undistributed) are allocated to common shares and participating securities based on their respective rights to receive dividends. Diluted earnings per share is computed similar to basic earnings per share except that the denominator is increased to include the number of additional shares for potential dilutive effects of the Preferred Shares and stock options outstanding during the period. The dilutive effects of the Preferred Shares are calculated in accordance with the if-converted method, or two-class method, whichever is more dilutive and the dilutive effects of stock options is calculated in accordance with the treasury stock method. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive. (t) Employee Benefit Plans The Company has a 401(k) retirement savings plan (the “RHI Plan”) open to U.S. based employees who have completed three months of eligible service. The Company contributes $0.60 for every $1.00 of employee contributions up to a maximum of 6% of the employee’s salary based upon each individual participant’s election. Expenses totaled $109,265 and $98,000 for employer contributions to the RHI Plan in the fiscal years ended March 31, 2021 and 2020, respectively. (u) Income taxes Income taxes are determined using the asset and liability method of accounting. Under this method, deferred tax assets and liabilities are recognized for the differences between the accounting bases of assets and liabilities and their corresponding tax basis. Deferred taxes are measured using enacted tax rates expected to apply when the asset is realized, or the liability is settled. A deferred tax asset is recognized when it is considered more likely than not to be realized. Through April 24, 2019, the Company filed income taxes as part of a consolidated group return with the Company’s then sole shareholder, Wesbild, Inc. Income taxes for the period subsequent to April 24, 2019 have been filed separately by the Company. RMM has elected to treat taxes on GILTI as period costs and no deferred tax asset or liability is recorded. (v) Comprehensive income The Company reports in accordance with ASC 220, Comprehensive Income. This standard requires companies to classify items of other comprehensive income/loss by their nature in the financial statements and display the accumulated balance of other comprehensive income (loss) separately from capital stock and accumulated deficit in the shareholders’ equity section of a statement of financial position. (w) Derivative financial instruments The Company’s interest rate swaps have not been designated as a hedging instrument and, therefore, are recognized at fair value at the end of each reporting period with changes in fair value recorded in income. (x) Fair value measurement and hierarchy The Company reports in accordance with ASC 820, Fair Value Measurements and Disclosures, (“ASC 820”). Under this standard, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e., the “exit price”) in an orderly transaction between market participants at the measurement date. ASC 820 establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions as to what market participants would use in pricing the asset or liability and are based on the best information available in the circumstances. The hierarchy is broken down into three levels based on the observability of inputs as follows: ● Level 1 — Valuations based on quoted prices in active markets for identical assets or liabilities that the Company has the ability to access. Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these products does not entail a significant degree of judgment. ● Level 2 — Valuations based on one or more quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly. ● Level 3 — Valuations based on inputs that are unobservable and significant to the overall fair value measurement. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes the level in the fair value hierarchy within which the fair value measurement falls is determined based on the lowest level input that is significant to the fair value measurement in its entirety. See Note 15. (y) Recent Accounting Pronouncements Accounting Standards Not Yet Adopted As an “emerging growth company” (“EGC”), the Jumpstart Our Business Startups Act (“JOBS Act”) allows the Company to delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are made applicable to private companies. The Company has elected to use this extended transition period under the JOBS Act. The adoption dates discussed below reflect this election. In February 2016, the FASB issued ASU 2016-02, Leases: (Topic 842) (“ASU 2016-02”), which establishes a right-of-use (“ROU”) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the consolidated statements of income. For public entities, this guidance was effective for annual reporting periods beginning after December 15, 2018, including interim periods within that annual reporting period. Under the guidance of ASU 2020-05, the new standard is effective for the Company April 1, 2022 and interim periods within the fiscal year beginning April 1, 2023. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company has not yet completed an analysis of the impact of the new lease guidance. Under current accounting guidance for leases, the Company does not recognize an asset or liability created by operating leases where the Company is the lessee. Therefore, the Company expects an increase to its assets and liabilities on the Company’s consolidated balance sheet as a result of recognizing assets and liabilities for operating leases where the Company is the lessee on the date of initial application of the new guidance. However, the Company cannot currently quantify this increase or the impact, if any, on its consolidated statements of income. The Company does not expect the adoption of this new guidance will have a material impact on the amount or timing of the Company’s cash flows or liquidity. In June 2016, the FASB issued ASU 2016-13, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which replaces the incurred loss impairment methodology in current US GAAP, with a methodology that reflects expected credit losses. Subsequent to ASU 2016-13, the FASB has issued several related ASUs amending the original ASU. The updates are intended to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. For public entities, this guidance was effective for annual reporting periods beginning after December 15, 2019, including interim periods within that annual reporting period. For the Company, this update is effective April 1, 2023, including interim periods within that fiscal year, with early adoption permitted for annual periods beginning after December 15, 2018. The Company has not yet evaluated the effect that this ASU will have on the Company’s consolidated financial statements. In April 2020, the FASB issued Accounting Standards Update No. 2020-04, Reference Rate Reform (Topic 848) (“ASU 2020-04”), which provides optional guidance for a limited period of time to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting; particularly as it relates to the risk of cessation of LIBOR. The amendments in this ASU apply only to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. The expedients and exceptions provided by this ASU do not apply to contract modifications made and hedging relationships entered into or evaluated after December 31, 2022, except for hedging relationships existing as of December 31, 2022, that an entity has elected certain optional expedients for and that are retained through the end of the hedging relationship. The Company has not yet evaluated the effect that this ASU will have on the Company’s consolidated financial statements. |
Revenue recognition
Revenue recognition | 12 Months Ended |
Mar. 31, 2021 | |
Reservoir Holdings Inc And Subsidiaries | |
Disaggregation of Revenue [Line Items] | |
Revenue recognition | 3. Revenue recognition For our operating segments, Music Publishing and Recorded Music, the Company accounts for a contract when it has legally enforceable rights and obligations and collectability of consideration is probable. The Company identifies the performance obligations and determines the transaction price associated with the contract. Revenue is recognized when, or as, control of the promised services or goods is transferred to the Company’s customers, and in an amount that reflects the consideration the Company is contractually due in exchange for those services or goods. Certain of the Company’s arrangements include licenses of intellectual property with consideration in the form of sales- and usage-based royalties. Royalty revenue is recognized when the subsequent sale or usage occurs using the best estimates available of the amounts that will be received by the Company. The Company recognized revenue of $2,263,778 and $788,364 from performance obligations satisfied in previous periods for the fiscal years ended March 31, 2021 and March 31, 2020, respectively. Disaggregation of Revenue The Company’s revenue consists of the following categories during the fiscal years ended March 31: 2021 2020 $ $ Revenue by Type Performance 16,514,790 13,656,061 Digital 35,028,049 28,798,051 Mechanical 3,050,120 2,472,527 Synchronization 9,891,034 6,891,554 Other 2,606,632 2,124,043 Total Music Publishing 67,090,625 53,942,236 Digital 7,603,040 4,569,106 Physical 3,962,596 1,432,026 Synchronization 492,258 1,384,959 Neighboring rights 1,537,087 1,642,405 Total Recorded Music 13,594,981 9,028,496 Other revenue 1,092,183 267,940 Total revenues 81,777,789 63,238,672 2021 2020 $ $ Revenue by Geographical Location United States Music Publishing 34,682,505 30,803,165 United States Recorded Music 4,891,800 3,475,647 United States other revenue 1,092,183 267,940 Total United States 40,666,488 34,546,752 International Music Publishing 32,408,121 23,139,071 International Recorded Music 8,703,180 5,552,849 Total international 41,111,301 28,691,920 Total revenues 81,777,789 63,238,672 Only the United States represented 10% or more of the Company’s total revenues in the fiscal years ended March 31, 2021 and 2020. Music Publishing Music Publishers act as a copyright owner and/or administrator of the musical compositions and generate revenues related to the exploitation of musical compositions (as opposed to recorded music). Music publishers receive royalties from the use of the musical compositions in public performances, digital and physical recordings, and through synchronization (the combination of music with visual images). Performance revenues are received when the musical composition is performed publicly through broadcast of music on television, radio and cable and in retail locations (e.g., bars and restaurants), live performance at a concert or other venue (e.g., arena concerts and nightclubs) and performance of musical compositions in staged theatrical productions. Digital revenues are derived from musical compositions being embodied in recordings licensed to digital streaming services and digital download services and for digital performance. Mechanical revenues are generated with respect to the musical compositions embodied in recordings sold in any physical format such as vinyl, CDs and DVDs. Synchronization revenues represent the right to use the composition in combination with visual images such as in films or television programs, television commercials and video games as well as from other uses such as in toys or novelty items and merchandise. Other revenues represent earnings for use in printed sheet music and other uses. Digital and synchronization revenue recognition is similar for both Recorded Music and Music Publishing, therefore refer to the discussion within Recorded Music. Included in these revenue streams, excluding synchronization and other, are licenses with performing rights organizations or collecting societies (e.g., ASCAP, BMI, SESAC and GEMA), which are long-term contracts containing a single performance obligation, which is ongoing access to all intellectual property in an evolving content library. The most common form of consideration for these contracts is sales- and usage-based royalties. The collecting societies submit usage reports, typically with payment for royalties due, often on a quarterly or biannual reporting period, in arrears. Royalties are recognized as the sale or usage occurs based upon usage reports and, when these reports are not available, royalties are estimated based on historical data, such as recent royalties reported, company-specific information with respect to changes in repertoire, industry information and other relevant trends. The Company excludes from the measurement of transaction price all taxes assessed by governmental authorities that are both (i) imposed on and concurrent with a specific revenue-producing transaction and (ii) collected from customers. Recorded Music Recorded Music mainly involves selling, marketing, distribution and licensing of recorded music owned by the Company. Recorded Music revenues are derived from four main sources, which include digital, physical, synchronization and neighboring rights. Digital revenues are generated from the expanded universe of digital partners, including digital streaming services and download services. Digital licensing contracts are generally long-term with consideration in the form of sales- and usage-based royalties that are typically received monthly. Additionally, for certain licenses, including synchronization licenses, where the consideration is fixed and the intellectual property being licensed is static, revenue is recognized at the point in time when control of the licensed content is transferred to the customer. Physical revenues are generated from the sale of physical products such as vinyl, CDs and DVDs. The Company uses distribution partners to facilitate the sale of physical products. Revenues from the sale of physical Recorded Music products are recognized upon transfer of control to the customer, which typically occurs once the product has been shipped and the ability to direct use and obtain substantially all of the benefit from the asset have been transferred. In accordance with industry practice and as is customary in many territories, certain products, such as CDs and DVDs, are sold to customers with the right to return unsold items. Revenues from such sales are generally recognized upon shipment based on gross sales. Synchronization revenues represent royalties or fees for the right to use sound recordings in combination with visual images such as in films or television programs, television commercials and video games. In certain territories, the Company may also receive royalties when sound recordings are performed publicly through broadcast of music on television, radio and cable and in public spaces such as shops, workplaces, restaurants, bars and clubs. These public performance royalties on sound recordings are classified as Neighboring Rights revenue. For fixed-fee contracts, revenue is recognized at the point in time when control of the licensed content is transferred to the customer. Royalty based contracts are recognized as the underlying sales or usage occurs. The following table reflects the change in deferred revenue during the fiscal years ended March 31: 2021 2020 $ $ Balance at beginning of period 473,022 287,406 Cash received during period 6,716,569 347,407 Revenue recognized during period (5,851,604) (161,791) Balance at end of period 1,337,987 473,022 |
Acquisitions
Acquisitions | 12 Months Ended |
Mar. 31, 2021 | |
Reservoir Holdings Inc And Subsidiaries | |
Business Acquisition [Line Items] | |
Acquisitions | 4. Acquisitions In the ordinary course of business, the Company regularly acquires music catalogs (publishing and recorded), which are typically accounted for as asset acquisitions. During the fiscal years ended March 31, 2021 and 2020, the Company completed such acquisitions totaling $116,323,171 and $114,480,181, inclusive of deferred acquisition payments. Significant acquisition transactions completed during the fiscal years ended March 31, 2021 and 2020 included the following: (a) Business combination On December 29, 2019, the Company acquired 51% of the equity of PopArabia FZ LLC (“PopArabia”) through a stock purchase agreement in a transaction accounted for as a business combination (the “PopArabia Acquisition”). The acquisition enabled the company to expand its operations to include a renewed focus in United Arab Emirates and the Middle East, which are becoming increasingly important global markets. Total purchase price consideration was $350,000, which resulted in purchase price allocations to net working capital of $284,207, including royalty payable of $1,198,472, cash and receivables of $1,417,974, goodwill of $402,067 and noncontrolling interest of $336,274. Goodwill is primarily attributable to intangible assets that do not qualify for separate recognition and has been assigned to the Music Publishing segment. Goodwill will not be amortizable or deductible for tax purposes. The PopArabia Acquisition is not material to the Company’s consolidated financial statements, and therefore, revenue and earnings since the acquisition date and supplemental pro forma financial information related to this business combination is not included herein. (b) Asset acquisitions On June 5, 2019, the Company acquired 100% of the equity of Blue Raincoat Music Limited (“BRM”), a UK operating company, which owns 100% of Chrysalis Records Limited, a UK recorded music company, through a stock purchase agreement. The transaction was accounted for as an asset acquisition as a result of the significant concentration of the fair value of gross assets acquired in a recorded music catalog intangible asset. Total consideration transferred was $51,554,223, of which $49,965,308 pertained to the acquired recorded music catalog (weighted average useful life of 30 years), with the remainder pertaining to net working capital and other assets. On February 21, 2020, the Company acquired 50.1% of the equity of Blue Raincoat Artists Ltd (“BRA”) through a stock purchase agreement. The transaction was accounted for as an asset acquisition as a result of the significant concentration of the fair value of gross assets acquired in artist management contracts (weighted average useful life of 10 years). Total consideration transferred was $678,423, of which $925,398 pertained to the acquired artist management contracts, noncontrolling interest of $675,715, with the remainder pertaining to net working capital. On April 13, 2020, the Company acquired all of the copyrights to the musical compositions owned by Shapiro, Bernstein & Co., Inc. (“SBI”), one of the oldest music publishers in the United States. The transaction was accounted for as an asset acquisition as a result of the significant concentration of the fair value of gross assets acquired in a publishing catalog intangible asset (weighted average useful life of 30 years). |
Intangible assets
Intangible assets | 12 Months Ended |
Mar. 31, 2021 | |
Reservoir Holdings Inc And Subsidiaries | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Intangible assets | 5. Intangible assets Intangible assets subject to amortization consist of the following at March 31: March 31, March 31, 2021 2020 $ $ Intangible assets subject to amortization: Music catalogs (publishing and recorded) 457,662,303 335,137,807 Artist management contracts 995,464 925,398 Gross intangible assets 458,657,767 336,063,205 Accumulated amortization (65,419,757) (50,954,097) Intangible assets, net 393,238,010 285,109,108 Amortization expense totaled $13,906,199 in 2021 and $8,250,305 in 2020. The expected amortization expense of intangible assets for each of the five succeeding fiscal years and thereafter is as follows: $ 2022 14,864,256 2023 14,864,256 2024 14,864,256 2025 14,864,256 2026 14,864,256 Thereafter 318,916,730 Total 393,238,010 |
Royalty advances
Royalty advances | 12 Months Ended |
Mar. 31, 2021 | |
Reservoir Holdings Inc And Subsidiaries | |
Royalty advances | 6. Royalty advances The Company made unsecured royalty advances totaling $14,474,288 during the fiscal year ended March 31, 2021 and $21,130,420 during the fiscal year ended March 31, 2020, recoupable from the writer’s share of future royalties otherwise payable, in varying amounts. Advances expected to be recouped within the next 12 months are classified as current assets, with the remainder classified as noncurrent assets. 2021 2020 $ $ Opening balance 40,263,439 33,350,939 Additions 14,474,288 21,130,420 Recoupments (13,155,647) (14,217,920) Closing balance 41,582,080 40,263,439 |
Loans and secured notes payable
Loans and secured notes payable | 12 Months Ended |
Mar. 31, 2021 | |
Reservoir Holdings Inc And Subsidiaries | |
Debt Instrument [Line Items] | |
Loans and secured notes payable | 7. Loans and secured notes payable Long-term debt consists of the following: 2021 2020 $ $ Secured loan bearing interest at LIBOR plus a spread 18,500,000 19,500,000 2021 2020 $ $ Secured line of credit bearing interest at LIBOR plus a spread 197,090,848 156,490,848 Debt issuance costs, net (3,058,973) (3,205,416) 212,531,875 172,785,432 Less: short term portion of Secured loan 1,000,000 1,000,000 211,531,875 171,785,432 Credit Facilities On December 19, 2014, the Company entered into a credit agreement (the “Credit Agreement”) governing the Company’s secured term loan (the “secured loan”) and secured revolving credit facility (the “secured line of credit” and together with the secured loan, the “Credit Facilities”). The Credit Facilities were subsequently amended multiple times with the most recent amendment consummated on December 23, 2020, as noted below. The principal amount of the term loan amortizes in quarterly instalments equal to $250,000 through June 30, 2024, with the balance due in full by October 16, 2024, subject to certain prepayment conditions as defined in the loan agreements. Repayment of the line of credit is due in full by October 16, 2024, subject to certain conditions. The Credit Facilities also include an incremental commitment amount (the “accordion feature”) that is not to exceed a $50,000,000 increase to the revolving credit facility. On May 20, 2020, the Company expanded the borrowing capacity of the secured line of credit by $25,000,000 to $205,000,000 pursuant to the accordion feature. The accordion feature was concurrently increased by $25,000,000 to $50,000,000. On December 23, 2020, the Company expanded the borrowing capacity of its secured line of credit by $25,000,000 to $230,000,000 pursuant to the accordion feature. The accordion feature was also concurrently increased by $25,000,000 to $50,000,000. At March 31, 2021, the secured line of credit has a borrowing capacity of $230,000,000, of which $197,090,848 was drawn on at March 31, 2021. Borrowings under the Credit Facilities are secured by all the Company’s assets. The interest rate applicable to borrowings under the Credit Facilities is 1M LIBOR plus 2.50%. Capitalized debt issuance costs are amortized over the term of the Credit Agreement into interest expense using the effective interest method. As of March 31, 2021, the expected principal repayment is as follows: $ 2022 1,000,000 2023 1,000,000 2024 213,590,848 215,590,848 Restrictions and Covenants Restrictions and Covenants The Credit Agreement contains a number of customary affirmative and negative covenants that, among other things, limits or restricts the Company’s ability and the ability of certain of the Company’s subsidiaries to: incur additional indebtedness; incur liens; engage in mergers, consolidations, liquidations and dissolutions; sell assets; pay dividends and make other payments in respect of capital stock; make investments, loans and advances; pay or modify the terms of certain indebtedness; and engage in certain transactions with affiliates. In addition, under the Credit Agreement, the Company is not permitted to exceed a leverage ratio of 5.50 to 1.0 or maintain a fixed charge coverage ratio of less than 1.25 to 1.0 as of the end of any fiscal quarter. The Company’s consolidated senior debt, as defined in the Credit Agreement, cannot exceed 55% of the value of the music library, as defined in the Credit Agreement and as adjusted in certain circumstances. Interest rate swaps As of March 31, 2019, the Company had entered into two interest rate swaps, both of which expire on March 10, 2022, one with a notional amount of $40,228,152 and one for $59,325,388. Under the terms of the interest rate swaps, the Company pays a fixed rate of 2.812% and 2.972% respectively, to the counterparty and receives a floating interest from the counter party based on LIBOR with reference to notional amounts adjusted to match the original scheduled principal repayments pursuant to the indenture agreement. The notional amount of the interest rate swaps is $97,533,496 at March 31, 2021 and $98,285,140 at March 31, 2020. In October 2019 and January 2020, the Company added two additional interest rate swaps in the amounts of $8,875,000 and $88,098,862, respectively. These swaps have an effective date of March 10, 2022 which coincides with the expiration of the previous two swaps, and the Company will pay a fixed rate of 1.602% and 1.492%, respectively, and receives a floating interest from the counterparty based on LIBOR with reference to notional amounts adjusted to match the original scheduled principal repayments pursuant to the indenture agreement. Secured Notes The Series 2007-A notes were issued by RMM Issuer, a wholly-owned subsidiary of RMM, and were secured by its assets without recourse to the Company (the “Notes”). Under the terms of the indenture, payment of interest and principal was based on the available cash of RMM Issuer and in the stated order of priority as provided for within the indenture agreement and interest not paid in cash was added to the outstanding principal. On April 2, 2019, the Company purchased the secured notes payable of RMM Issuer for $1,625,000 plus the vendors legal costs, which reflects the decline in fair value of the collateral securing the Notes and resulted in the Company recognizing a gain of $10,644,084 on the retirement of the debt. |
Other non-current liabilities
Other non-current liabilities | 12 Months Ended |
Mar. 31, 2021 | |
Reservoir Holdings Inc And Subsidiaries | |
Other non-current liabilities | 8. Other non-current liabilities At March 31, 2021, the Company’s other non-current liabilities, which consist primarily of obligations related to certain asset purchases and acquisitions that are due more than a year in the future, are as follows: $ 2023 5,738,348 2024 213,783 2025 213,783 2026 and later 574,057 6,739,971 |
Income taxes
Income taxes | 12 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | |
Operating Loss Carryforwards [Line Items] | ||
Income taxes | NOTE 8 — INCOME TAX The Company’s net deferred tax assets are as follows: December 31, December 31, 2020 2019 Deferred tax assets Net operating loss carryforward $ 17,142 $ 257 Unrealized gain on marketable securities (1,389) — Startup and organizational costs 6,215 — Total deferred tax assets 21,968 257 Valuation Allowance (21,968) (257) Deferred tax assets $ — $ — The income tax provision consists of the following: December 31, December 31, 2020 2019 Federal Current $ — $ — Deferred (21,711) (257) State and Local Current — — Deferred — — Change in valuation allowance 21,711 257 Income tax provision $ — $ — As of December 31, 2020 and 2019, the Company had $104,610 and $1,225, respectively of U.S. federal net operating loss carryovers available to offset future taxable income. In assessing the realization of the deferred tax assets, management considers whether it is more likely than not that some portion of all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which temporary differences representing net future deductible amounts become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. After consideration of all of the information available, management believes that significant uncertainty exists with respect to future realization of the deferred tax assets and has therefore established a full valuation allowance. For the year ended December 31, 2020, the change in the valuation allowance was $21,711. A reconciliation of the federal income tax rate to the Company’s effective tax rate is as follows: December 31, December 31, 2020 2019 Statutory federal income tax rate 21.0 % 21.0 % State taxes, net of federal tax benefit 0.0 % 0.0 % Meals and entertainment 0.0 % 0.0 % Valuation allowance (21.0) (21.0) Income tax provision 0.0 % 0.0 % The Company files income tax returns in the U.S. federal jurisdiction and is subject to examination by the various taxing authorities. The Company’s tax returns since inception remain open to examination by the taxing authorities. The Company considers California to be a significant state tax jurisdiction. | |
Reservoir Holdings Inc And Subsidiaries | ||
Operating Loss Carryforwards [Line Items] | ||
Income taxes | 9. Income taxes The following table presents domestic and foreign income before income taxes for the fiscal years ended March 31: 2021 2020 $ $ Domestic 11,126,090 12,174,556 Foreign 1,663,697 2,035,352 Income before income taxes 12,789,787 14,209,908 The provision for income taxes consists of the following for the fiscal years ended March 31: 2021 2020 $ $ Current income taxes: U.S. federal (216,528) 236,057 State and local 8,827 192,141 Foreign 581,232 119,709 Total current 373,531 547,907 Deferred income taxes: U.S. federal 2,188,194 2,775,979 State and local 259,182 (114,785) Foreign (366,754) 990,040 Total deferred 2,080,622 3,651,234 Income tax expense 2,454,153 4,199,141 We have determined that undistributed earnings of certain non-U.S. subsidiaries will be reinvested for an indefinite period of time. We have both the intent and ability to indefinitely reinvest these earnings. Given our intent to reinvest these earnings for an indefinite period of time, we have not accrued a deferred tax liability on these earnings. A determination of an unrecognized deferred tax liability related to these earnings is not practicable. A reconciliation of the statutory tax rate to the effective rate is as follows for the fiscal years ended March 31: 2021 2020 Federal income tax statutory rate 21.0 % 21.0 % State and local income taxes, net of federal income tax benefit 1.7 % 1.4 % Foreign subsidiary earnings 2.1 % 0.4 % Return to provision adjustments (4.9) % (1.5) % Impact of change in tax rates 0.3 % 8.2 % Other, net (1.0) % 0.1 % Effective income tax rate 19.2 % 29.6 % The Company’s effective tax rate may vary from period to period depending on, among other factors, the geographic and business mix of earnings and losses. These same and other factors, including history of pre-tax earnings and losses, are taken into account in assessing the ability to realize deferred tax assets. Significant components of the Company’s deferred income tax liability at March 31 are as follows: 2021 2020 $ $ Deferred tax assets: Net operating loss carryforward 785,902 481,360 Fair value of swaps 1,046,459 1,718,059 Compensation 44,375 20,682 Charitable contributions 8,951 — Unrealized foreign exchange losses 51,924 — Total deferred tax assets 1,937,611 2,220,101 Deferred tax liabilities: Fixed assets and leasehold improvements (44,393) (72,006) Intangible assets (21,628,755) (18,563,334) Deferred charges — — Total deferred tax liabilities (21,673,148) (18,635,340) Net deferred tax liabilities (19,735,537) (16,415,239) At March 31, 2021, the Company has income tax Net operating loss carry forwards of $48,971,281 related to the US operations. The Company has recorded a deferred tax asset of $785,902 reflecting the benefit of $48,971,281 in loss carry forwards. Such net operating loss carry forwards will expire as follows: Federal $ 1,795,951 No expiration date New York 46,903,391 2035 – 2040 California 151,988 2040 Tennessee 119,951 2035 Tax Uncertainties In the normal course of business, the Company’s tax returns are subject to examination by various taxing authorities. Such examinations may result in future tax and interest assessments by these taxing jurisdictions. Accordingly, the Company accrues liabilities when it believes that it is not more likely than not that it will realize the benefits of tax positions that it has taken in its tax returns or for the amount of any tax benefit that exceeds the cumulative probability threshold in accordance with ASC 740-10. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company records interest and penalties related to unrecognized tax benefits in income tax expense (benefit). Differences between the estimated and actual amounts determined upon ultimate resolution, individually or in the aggregate, are not expected to have a material adverse effect on the Company’s consolidated financial position but could possibly be material to the Company’s consolidated results of operations or cash flow in any given quarter or annual period. As of March 31, 2021, the Company has not recorded any unrecognized tax benefits. Tax Audits The Company and its eligible subsidiaries file a consolidated U.S. federal income tax return and applicable state and local income tax returns and non-U.S. income tax returns. The Company is subject to examination by federal, state and local, and foreign tax authorities. RMM’s Federal income tax returns for the years 2018 through 2020 are subject to examination by the Internal Revenue Service, and RMM’s state tax returns are subject to examination by the respective tax authorities for the years 2017 through 2020. Non-U.S. tax returns are subject to examination by the respective tax authorities for the years 2017 through 2020. The Company regularly assesses the likelihood of additional assessments by each jurisdiction and have established tax reserves that the Company believes are adequate in relation to the potential for additional assessments. Examination outcomes and the timing of examination settlements are subject to uncertainty. Although the results of such examinations may have an impact on the Company’s unrecognized tax benefits, the Company does not anticipate that such impact will be material to its consolidated financial position or results of operations. The Company does not expect to settle any material tax audits in the next twelve months. |
Supplementary cash flow informa
Supplementary cash flow information | 12 Months Ended |
Mar. 31, 2021 | |
Reservoir Holdings Inc And Subsidiaries | |
Supplementary cash flow information | 10. Supplementary cash flow information Summary of interest paid and income taxes paid for the fiscal years ended March 31 comprised the following: 2021 2020 $ $ Interest paid 8,176,888 6,099,653 Income taxes paid 131,414 205,067 |
Amounts due to _ (from) related
Amounts due to / (from) related parties | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | |
Related Party Transaction [Line Items] | |||
Amounts due to / (from) related parties | NOTE 5. RELATED PARTY TRANSACTIONS Founder Shares In February 2019, the Initial Stockholders purchased an aggregate of 100 shares of the Company’s common stock for an aggregate price of $25,000. On June 29, 2020, the Company effected a stock dividend of 43,125 shares of common stock for each share of common stock outstanding, resulting in an aggregate of 4,312,500 shares of common stock being held by the Initial Stockholders. On August 31, 2020, the Initial Stockholders transferred back to the Company 1,437,500 shares of common stock, for nominal consideration, which shares were cancelled, resulting in there being an aggregate of 2,875,000 shares of common stock outstanding and being held by the Initial Stockholders (the “Founder Shares”). That same day, CHLM Sponsor-1 LLC, an entity affiliated with Craig-Hallum Capital Group LLC, and certain of the Company’s directors, officers and affiliates of the Company’s management team purchased from CR Financial Holdings, Inc. an aggregate of 745,840 shares for an aggregate purchase price of $6,486. All share and per-share amounts have been retroactively restated to reflect the stock dividend and cancellation. The Founder’s Shares included an aggregate of up to 375,000 shares subject to forfeiture by the Sponsor to the extent that the underwriters’ over-allotment was not exercised in full or in part, so that the Sponsor would collectively own 20% of the Company’s issued and outstanding shares after the Initial Public Offering (excluding the Private Shares underlying the Private Securities). As a result of the underwriters’ election to fully exercise their over-allotment option, no Founder Shares are currently subject to forfeiture. The Initial Stockholders have agreed, subject to certain limited exceptions, not to transfer, assign or sell any of the Founder Shares until (1) with respect to 50% of the Founder Shares, the earlier of six months after the completion of a Business Combination and the date on which the closing price of the common stock equals or exceeds $12.50 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30 - trading day period commencing after a Business Combination and (2) with respect to the remaining 50% of the Founder Shares, six months after the completion of a Business Combination, or earlier, in either case, if, subsequent to a Business Combination, the Company completes a liquidation, merger, stock exchange or other similar transaction which results in all of the Company’s stockholders having the right to exchange their shares of common stock for cash, securities or other property. Promissory Note — Related Party On August 23, 2020, the Company issued an unsecured promissory note to the sponsor (the “Promissory Note”), pursuant to which the Company may borrow up to an aggregate principal amount of $200,000. The Promissory Note is non-interest bearing and payable on the earlier of (i) the consummation of the Initial Public Offering or (ii) the date on which the Company determines not to proceed with the Initial Public Offering. The outstanding balance under the Promissory Note of $200,000 was repaid at the closing of the Initial Public Offering on December 15, 2020. Related Party Loans In addition, in order to finance transaction costs in connection with a Business Combination, the Initial Stockholders, or certain of the Company’s officers and directors or their affiliates may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). If the Company completes a Business Combination, the Company would repay the Working Capital Loans out of the proceeds of the Trust Account released to the Company. Otherwise, the Working Capital Loans would be repaid only out of funds held outside the Trust Account. In the event that a Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans, but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. Except for the foregoing, the terms of such Working Capital Loans, if any, have not been determined and no written agreements exist with respect to such loans. The Working Capital Loans would be repaid upon consummation of a Business Combination, without interest. | NOTE 5 — RELATED PARTY TRANSACTIONS Founder Shares In February 2019, the Initial Stockholders purchased an aggregate of 100 shares of the Company’s common stock for an aggregate price of $25,000. On June 29, 2020, the Company effected a stock dividend of 43,125 shares of common stock for each share of common stock outstanding, resulting in an aggregate of 4,312,500 shares of common stock being held by the Initial Stockholders. On August 31, 2020, the Initial Stockholders transferred back to the Company 1,437,500 shares of common stock, for nominal consideration, which shares were cancelled, resulting in there being an aggregate of 2,875,000 shares of common stock outstanding and being held by the Initial Stockholders (the “Founder Shares”). That same day, CHLM Sponsor-1 LLC, an entity affiliated with Craig-Hallum Capital Group LLC, and certain of the Company’s directors, officers and affiliates of the Company’s management team purchased from CR Financial Holdings, Inc. an aggregate of 745,840 shares for an aggregate purchase price of $6,486. All share and per-share amounts have been retroactively restated to reflect the stock dividend and cancellation. The Founder’s Shares included an aggregate of up to 375,000 shares subject to forfeiture by the Sponsor to the extent that the underwriters’ over-allotment was not exercised in full or in part, so that the Sponsor would collectively own 20% of the Company’s issued and outstanding shares after the Initial Public Offering (excluding the Private Shares underlying the Private Securities). As a result of the underwriters’ election to fully exercise their over-allotment option, no Founder Shares are currently subject to forfeiture. The Initial Stockholders have agreed, subject to certain limited exceptions, not to transfer, assign or sell any of the Founder Shares until (1) with respect to 50% of the Founder Shares, the earlier of six months after the completion of a Business Combination and the date on which the closing price of the common stock equals or exceeds $12.50 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing after a Business Combination and (2) with respect to the remaining 50% of the Founder Shares, six months after the completion of a Business Combination, or earlier, in either case, if, subsequent to a Business Combination, the Company completes a liquidation, merger, stock exchange or other similar transaction which results in all of the Company’s stockholders having the right to exchange their shares of common stock for cash, securities or other property. Promissory Note — Related Party On August 23, 2020, the Company issued an unsecured promissory note to the sponsor (the “Promissory Note”), pursuant to which the Company may borrow up to an aggregate principal amount of $200,000. The Promissory Note is non-interest bearing and payable on the earlier of (i) the consummation of the Initial Public Offering or (ii) the date on which the Company determines not to proceed with the Initial Public Offering. The outstanding balance under the Promissory Note of $200,000 was repaid at the closing of the Initial Public Offering on December 15, 2020. Related Party Loans In addition, in order to finance transaction costs in connection with a Business Combination, the Initial Stockholders, or certain of the Company’s officers and directors or their affiliates may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). If the Company completes a Business Combination, the Company would repay the Working Capital Loans out of the proceeds of the Trust Account released to the Company. Otherwise, the Working Capital Loans would be repaid only out of funds held outside the Trust Account. In the event that a Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans, but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. Except for the foregoing, the terms of such Working Capital Loans, if any, have not been determined and no written agreements exist with respect to such loans. The Working Capital Loans would be repaid upon consummation of a Business Combination, without interest. | |
Reservoir Holdings Inc And Subsidiaries | |||
Related Party Transaction [Line Items] | |||
Amounts due to / (from) related parties | 11. Amounts due to / (from) related parties The Company has various shared services agreements with its majority shareholder and other affiliated entities under the control of its majority shareholder. These agreements cover services such as IT support and re-billed services of staff who perform services across multiple entities. 2021 2020 $ $ Due to Wesbild Inc. Unsecured, bears no interest, with no specific terms of repayment — — Due to Wesbild Holdings Ltd., parent company of Wesbild Inc. Unsecured, bears no interest, with no specific terms of repayment 83,480 7,665 Sub-total 83,480 7,665 Due to (from) DRI Capital Inc., a subsidiary of Wesbild Holdings Ltd. Unsecured, bears no interest, with no specific terms of repayment 81,738 (60,444) Due to Reservoir Media Management (Canada) Inc., a subsidiary of Wesbild Holdings Ltd. Unsecured, bears no interest, with no specific terms of repayment 124,954 47,108 Sub-total 206,692 (13,336) 290,172 (5,671) |
Shareholders' equity
Shareholders' equity | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | |
Class of Stock [Line Items] | |||
Shareholders' equity | NOTE 7 — STOCKHOLDERS’ EQUITY Common Stock — issued outstanding | NOTE 7 — STOCKHOLDERS’ EQUITY Common Stock issued outstanding Warrants effective registration statement and during any period when the Company shall have failed to maintain an effective registration statement, exercise warrants on a cashless basis pursuant to an available exemption from registration under the Securities Act. The warrants will expire five years from the closing of a Business Combination. Once the warrants become exercisable, the Company may redeem the Public Warrants: ● in whole and not in part; ● at a price of $ 0.01 per warrant; ● at any time after the warrants become exercisable; ● upon not less than 30 days ’ prior written notice of redemption to each warrant holder; ● if, and only if, the reported last sale price of the shares of common stock equals or exceeds $ 18.00 per share, for any 20 trading days within a 30 - day trading period commencing after the warrants become exercisable and ending on the third business day prior to the notice of redemption to warrant holders; and ● if, and only if, there is a current registration statement in effect with respect to the shares of common stock underlying such warrants at the time of redemption and for the entire 30-day trading period referred to above and continuing each day thereafter until the date of redemption. If the Company calls the Public Warrants for redemption, management will have the option to require all holders that wish to exercise the Public Warrants to do so on a “cashless basis,” as described in the warrant agreement. The exercise price and number of shares of common stock issuable on exercise of the warrants may be adjusted in certain circumstances including in the event of a stock dividend, extraordinary dividend or our recapitalization, reorganization, merger or consolidation. However, except as described below, the warrants will not be adjusted for issuances of shares of common stock at a price below their respective exercise prices. Additionally, in no event will the Company be required to net cash settle the warrants. If the Company is unable to complete a Business Combination within the Combination Period and the Company liquidates the funds held in the Trust Account, holders of warrants will not receive any of such funds with respect to their warrants, nor will they receive any distribution from the Company’s assets held outside of the Trust Account with the respect to such warrants. Accordingly, the warrants may expire worthless. In addition, if (x) the Company issues additional shares of common stock or equity-linked securities for capital raising purposes in connection with the closing of a Business Combination at an issue price or effective issue price of less than $9.20 per share of common stock (with such issue price or effective issue price to be determined in good faith by the Company’s board of directors, and in the case of any such issuance to the Initial Stockholders or their affiliates, without taking into account any Founder Shares held by them prior to such issuance), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of a Business Combination on the date of the consummation of a Business Combination (net of redemptions), and (z) the volume weighted average trading price of the Company’s common stock during the 20 trading day period starting on the trading day prior to the day on which the Company consummates Business Combination (such price, the “Market Value”) is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the Market Value and the $18.00 per share redemption trigger price described above will be adjusted (to the nearest cent) to be equal to 180% of the Market Price. The Private Warrants are identical to the Public Warrants underlying the Units sold in the Initial Public Offering, except that the Private Warrants and the shares of common stock issuable upon the exercise of the Private Warrants will not be transferable, assignable or saleable until after the completion of a Business Combination, subject to certain limited exceptions. Additionally, the Private Warrants will be exercisable for cash or on a cashless basis, at the holder’s option, and be non-redeemable so long as they are held by the initial purchasers or their permitted transferees. If the Private Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants. | |
Reservoir Holdings Inc And Subsidiaries | |||
Class of Stock [Line Items] | |||
Shareholders' equity | 12. Shareholders’ equity (a) April 23, 2019 Equity restructuring RMM and the Company completed a series of transactions with shareholders on April 23, 2019, as follows: The board of directors of RMM declared a dividend payable to RMM’s sole shareholder in an amount of $16,875,000 and issued a demand promissory note to the shareholder in a principal amount of $16,875,000 (the “RMM Shareholder Promissory Note”). As discussed in Note 1, RMM’s sole shareholder contributed its 100% equity interest in RMM to the Company in exchange for 125,227 shares of the Company’s common stock (par value $0.00001 per share) (the “common shares”), resulting in RMM becoming a wholly-owned subsidiary of the Company. Since the Company and RMM were entities under common control, this exchange of RMM’s common stock for the common shares resulted in the retrospective combination of RMM and the Company for all periods presented as if the combination had been in effect since the inception of common control. The Company issued 67,500 Series A-1 preferred shares (the “Series A-1 Preferred Shares”) for aggregate consideration of $67,500,000 ($1,000 per Series A-1 Preferred Share). The Company incurred $825,000 of issuance costs in connection with the issuance of the Series A-1 Preferred Shares, which the Company accounted for as a reduction in the proceeds from the Series A-1 Preferred Shares. The RMM Shareholder Promissory Note was paid using $16,875,000 of the proceeds from the issuance of the Series A-1 Preferred Shares. (b) Additional Equity Transactions During the first quarter of fiscal 2021, the Company issued 5,333 shares of common stock for aggregate consideration of $8,000,009 to existing shareholders to fund further acquisitions. The Company incurred $27,000 of issuance costs in connection with the issuance of this common stock, which the Company accounted for as a reduction in the proceeds from the common stock. On January 3, 2020, the Company issued 15,000 Series A-2 preferred shares (the Series A-2 Preferred Shares) for aggregate consideration of $15,000,000 and 15,000 common shares for aggregate consideration of $15,000,000 to existing shareholders. The Company incurred $85,000 of issuance costs in connection with the issuance of the Series A-2 Preferred Shares and common shares, which the Company accounted for as a reduction in the proceeds from the Series A-2 Preferred Shares and common shares on a pro rata basis. In October and November 2018, RMM’s sole shareholder contributed $8,300,000 to RMM to support continued acquisitions by RMM. No additional shares were issued and the shareholder contribution is reflected as contributed capital in the Company’s consolidated statement of equity. (c) Preferred Shares The Series A-1 Preferred Shares and Series A-2 Preferred Shares have the same terms and are therefore presented together in the Company’s consolidated financial statements as a single series of preferred stock (the “Preferred Shares”). The Preferred Shares are convertible into an equal number of common shares at the option of the preferred shareholder and are mandatorily converted into an equal number of common shares upon a qualified public offering of common shares. The Preferred Shares have voting rights equal to one vote per each Preferred Share. Holders of the Preferred Shares and common shares vote together as a single class. The Preferred Shares participate in dividends declared on common shares, if any, on the basis as if the Preferred Shares were converted to common shares. The Company has not declared any dividends since issuance of the Preferred Shares through March 31, 2020. A 6.0% annual compounded cumulative dividend accrues on the original investment amount only if the Preferred Shares are not automatically converted and there is a liquidation, dissolution or winding up of the Company’s affairs. There are no redemption provisions for the Preferred Shares. In the event of a liquidation, dissolution or winding up of the Company’s affairs, whether voluntary or involuntary, after satisfaction of all liabilities and obligations to the Company’s creditors, the holder of the Preferred Shares shall be entitled to receive payment in full, in cash, equal to the original investment amount, plus accrued and unpaid dividends, before any distributions may be made to the Company’s common shareholders (the “Preferred Liquidation Preference”). If the Preferred Liquidation Preference has been paid in full on all Preferred Shares, the holders of the Company’s common shares shall be entitled to receive all of the Company’s remaining assets (or proceeds thereof) according to their respective rights and preferences. |
Share-based compensation
Share-based compensation | 12 Months Ended |
Mar. 31, 2021 | |
Reservoir Holdings Inc And Subsidiaries | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Share-based compensation | 13. Share-based compensation In April 2019, the Company adopted a Long-Term Incentive Plan (the “Plan”) to grant awards to its current or prospective employees, officers, directors or consultants of the company and its subsidiaries. The aggregate number of shares of common stock available for issuance under the Plan is 12,000. No awards were granted during the fiscal year ended March 31, 2021. During the fiscal year ended March 31, 2020, the Company granted a total of 7,700 stock options under the Plan. Stock option awards are granted with an exercise price equal to the estimated fair value of our common shares on the date of grant. We will satisfy stock option exercises through the issuance of authorized but previously unissued common shares. Stock option grants vest over 4 years with 25% vested after one year from the original grant date and the remaining 75% vesting in 36 equal monthly installments thereafter, provided the employee is continuously employed by us or one of our affiliates, and the stock options expire 10 years following the grant date. The Company records share-based compensation expense for stock options based on the estimated fair value of the options on the date of the grant using the Black-Scholes option-pricing model. The absence of a public market for the Company’s common stock required the Company’s board of directors to estimate the fair value of its common stock for purposes of granting options and for determining share-based compensation expense by considering several objective and subjective factors, including third-party valuations, actual and forecasted operating and financial results, market conditions and performance of comparable publicly traded companies, developments and milestones in the Company, the rights and preferences of common and convertible preferred stock, and transactions involving the Company’s stock. The fair value of the Company’s common stock was determined in accordance with applicable elements of the American Institute of Certified Public Accountants guide, Valuation of Privately Held Company Equity Securities Issued as Compensation. The following assumptions were used in the Black-Scholes option-pricing model to determine the fair value of stock option awards at the grant date: (i) risk-free interest rate of 1.74 % – 2.41 %, based on the U.S. Treasury bond yield with a remaining term equal to the expected option life assumed at the date of grant. (ii) expected term (in years) of 8 ; which is based on consideration of the contractual terms of the stock-based awards, vesting schedules, and expectations of future employee behavior. (iii) expected volatility of 39.1% to 57.7% determined by using an average of historical volatilities of selected companies deemed to be comparable to the Company corresponding to the expected term of the awards. (iv) expected dividend yield of 0% , which reflects the Company’s lack of history or expectation of declaring dividends on its common stock. Share-based compensation expense totaled $102,700 ($79,165, net of taxes) and $90,944 ($70,262, net of taxes) during the fiscal years ended March 31, 2021 and 2020, respectively, and is classified as Administration expenses in the accompanying consolidated statements of income. The following table is a summary of stock option activity under the Plan for the fiscal year ended March 31, 2021: Weighted Average Weighted Remaining Total Average Aggregate Contractual Number of Exercise Intrinsic Term Options Price Value (Years) $ $ Outstanding at April 1, 2020 7,624 1,000 Granted — Exercised — Forfeited — Outstanding at March 31, 2021 7,624 1,000 4,933,306 8.1 Exercisable at March 31, 2021 — — Vested or expected to vest at March 31, 2021 7,624 1,000 4,933,306 8.1 The weighted average grant date fair value per stock option granted was $53.88 during the fiscal year ended March 31, 2020. Pre-tax unrecognized compensation expense for unvested stock options was $217,152 as of March 31, 2021, which will be recognized as expense over a weighted-average period of approximately 2.1 years. |
Earnings per share
Earnings per share | 12 Months Ended |
Mar. 31, 2021 | |
Reservoir Holdings Inc And Subsidiaries | |
Earnings per share | 14. Earnings per share The following table summarizes the basic and diluted earnings per share calculations for the fiscal years ended March 31: 2021 2020 Basic earnings per common share Net income attributable to Reservoir Holdings Inc. $ 10,288,961 $ 10,057,794 Less: income allocated to participating securities (3,736,121) $ (3,435,754) Net income attributable to common shareholders $ 6,552,840 $ 6,622,040 Basic weighted average common shares outstanding 144,698 128,875 Basic earnings per common share $ 45.29 $ 51.38 Diluted earnings per common share Net income attributable to common shareholders $ 6,552,840 $ 6,622,040 Add: income allocated to participating securities 3,736,121 3,435,754 Net income attributable to Reservoir Holdings Inc. $ 10,288,961 $ 10,057,794 Basic weighted average common shares outstanding 144,698 128,875 Impact of assumed preferred share conversion 82,500 66,865 Diluted weighted average common shares outstanding 227,198 195,740 Diluted earnings per common share $ 45.29 $ 51.38 Because of their anti-dilutive effect, 7,624 common share equivalents comprised of stock options have been excluded from the diluted earnings per share calculation for the fiscal years ended March 31, 2021 and 2020. |
Financial instruments
Financial instruments | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Financial instruments | NOTE 9. FAIR VALUE MEASUREMENTS The Company follows the guidane in ASC 820 for its financial assets and liabilities that are re-measured and reported at fair value at each reporting period, and non-financial assets and liabilities that are re-measured and reported at fair value at least annually. The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities: Level 1: Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2: Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active. Level 3: Unobservable inputs based on our assessment of the assumptions that market participants would use in pricing the asset or liability. The following table presents information about the Company’s assets that are measured at fair value on a recurring basis at March 31, 2021, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value: March 31, December 31, Description Level 2021 2020 Assets: Marketable securities held in Trust Account 1 $ 115,012,821 $ 115,006,613 Liabilities Warrant liabilities – Private Placement Warrants 3 $ 178,750 $ 129,250 The Warrants were accounted for as liabilities in accordance with ASC 815-40 and are presented within warrant liabilities on our accompanying March 31, 2021 condensed balance sheet. The warrant liabilities are measured at fair value at inception and on a recurring basis, with changes in fair value presented within change in fair value of warrant liabilities in the condensed statement of operations. The Warrants were valued using a binomial lattice model incorporating the Cox-Ross-Rubenstein methodology, which is considered to be a Level 3 fair value measurement. The binomial lattice model’s primary unobservable input utilized in determining the fair value of the Warrants is the expected volatility of the common stock. The expected volatility as of the IPO date was derived from observable public warrant pricing on comparable ‘blank-check’ companies without an identified target. The expected volatility as of subsequent valuation dates was implied from the Company’s own public warrant pricing. There were no transfers between The following table provides quantitative information regarding Level 3 fair value measurements: At As of December 31, March 31, 2020 2021 Stock price $ 9.54 $ 9.91 Strike price $ 11.50 $ 11.50 Volatility 17.5% 19.1% Risk-free rate 0.41% 0.94% Probability of Business Combination occurring 75% 75% Dividend yield 0.0% 0.0% Fair value of warrants $ 0.94 $ 1.30 The following table presents the changes in the fair value of warrant liabilities: Warrant Liabilities Fair value as of December 31, 2020 $ 129,250 Change in valuation inputs or other assumptions 49,500 Fair value as of March 31, 2021 178,750 | NOTE 9 — FAIR VALUE MEASUREMENTS The Company follows the guidance in ASC 820 for its financial assets and liabilities that are re-measured and reported at fair value at each reporting period, and non-financial assets and liabilities that are re-measured and reported at fair value at least annually. The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities: Level 1: Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2: Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active. Level 3: Unobservable inputs based on our assessment of the assumptions that market participants would use in pricing the asset or liability. The following table presents information about the Company’s assets that are measured at fair value on a recurring basis at December 31, 2020, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value: December 31, Description Level 2020 Assets: Cash and marketable securities held in Trust Account 1 $ 115,006,613 | |
Reservoir Holdings Inc And Subsidiaries | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Financial instruments | 15. Financial instruments The Company is exposed to the following risk related to its financial instruments: (a) Credit risk Credit risk arises from the possibility that the Company’s debtors may be unable to fulfill their financial obligations. Revenues earned from publishing and distribution companies are concentrated in the music and entertainment industry. The Company monitors its exposure to credit risk on a regular basis. (b) Interest rate risk The Company is exposed to market risk from changes in interest rates on its secured loan. As described in Note 7, the Company entered into interest rate swap agreements to partially reduce its exposure to fluctuations in interest rates on its secured loans. The fair value of the outstanding interest rate swaps was a $4,566,537 liability at March 31, 2021 and a $7,554,859 liability at March 31, 2020. Fair value is determined using Level 2 inputs, which are based on quoted prices and market observable data of similar instruments. The change in the unrealized fair value of the swaps of $2,988,322 during the fiscal year ended March 31, 2021 was recorded as a gain on changes in fair value of derivative instruments. The change in the unrealized fair value of the swaps of $5,555,702 during the fiscal year ended March 31, 2020 was recorded as a loss on changes in fair value of derivative instruments. (c) Foreign exchange risk The company is exposed to foreign exchange risk in fluctuations of currency rates on its revenue from royalties, writer’s fee and its subsidiaries’ operations. (d) Financial instruments Financial instruments not described elsewhere include cash, restricted cash, accounts receivable, accounts payable, accrued liabilities, secured loans payable and borrowing under its line of credit. The carrying values of these instruments at March 31, 2021 do not differ materially from their respective fair values due to the immediate or short-term duration of these items or their bearing market related rates of interest. The fair value of amounts due from and owed to related parties are impracticable to determine due to the related party nature of such amounts and the lack of readily determinable secondary market. |
Contingencies and commitments
Contingencies and commitments | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | |
Contingencies and commitments | NOTE 6. COMMITMENTS AND CONTINGENCIES Registration Rights Pursuant to a registration rights agreement entered into on December 10, 2020, the holders of the Founder Shares, as well as the holders of the Private Units (and underlying securities) and any securities issued to the Initial Stockholders, officers, directors or their affiliates in payment of Working Capital Loans made to Company, will be entitled to registration rights. The holders of a majority of these securities are entitled to make up to two demands that the Company register such securities. The holders of the majority of the Founder Shares can elect to exercise these registration rights at any time commencing three months prior to the date on which these shares of common stock are to be released from escrow. The holders of a majority of the Private Units (and underlying securities) and securities issued in payment of Working Capital Loans (or underlying securities) can elect to exercise these registration rights at any time after the Company consummates a Business Combination. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to consummation of a Business Combination. The registration rights agreement does not contain liquidating damages or other cash settlement provisions resulting from delays in registering the Company’s securities. The Company will bear the expenses incurred in connection with the filing of any such registration statements. Notwithstanding the foregoing, the Company may not exercise demand or piggyback rights after five (5) and seven (7) years, respectively, from the effective date of the Initial Public Offering and may not exercise demand rights on more than one occasion in respect of all registrable securities. Underwriting Agreement The underwriters were paid a cash underwriting discount of 1.00% of the gross proceeds of the Initial Public Offering, or $1,150,000. Business Combination Marketing Agreement The Company entered into a business combination marketing agreement with the representatives of the underwriters as advisors in connection with a Business Combination. The Company will pay the representatives of the underwriters a marketing fee for such services upon the consummation of a Business Combination in an amount equal to, in the aggregate, 4.5% of the gross proceeds of the Initial Public Offering, including any proceeds from the full or partial exercise of the underwriters’ over-allotment option. As a result, the representatives of the underwriters will not be entitled to such fee unless the Company consummates its initial business combination. | NOTE 6 — COMMITMENTS AND CONTINGENCIES Registration Rights Pursuant to a registration rights agreement entered into on December 10, 2020, the holders of the Founder Shares, as well as the holders of the Private Units (and underlying securities) and any securities issued to the Initial Stockholders, officers, directors or their affiliates in payment of Working Capital Loans made to Company, will be entitled to registration rights. The holders of a majority of these securities are entitled to make up to two demands that the Company register such securities. The holders of the majority of the Founder Shares can elect to exercise these registration rights at any time commencing three months prior to the date on which these shares of common stock are to be released from escrow. The holders of a majority of the Private Units (and underlying securities) and securities issued in payment of Working Capital Loans (or underlying securities) can elect to exercise these registration rights at any time after the Company consummates a Business Combination. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to consummation of a Business Combination. The registration rights agreement does not contain liquidating damages or other cash settlement provisions resulting from delays in registering the Company’s securities. The Company will bear the expenses incurred in connection with the filing of any such registration statements. Notwithstanding the foregoing, the Company may not exercise demand or piggyback rights after five (5) and seven (7) years, respectively, from the effective date of the Initial Public Offering and may not exercise demand rights on more than one occasion in respect of all registrable securities. Underwriting Agreement The underwriters were paid a cash underwriting discount of 1.00% of the gross proceeds of the Initial Public Offering, or $1,150,000. Business Combination Marketing Agreement The Company entered into a business combination marketing agreement with the representatives of the underwriters as advisors in connection with a Business Combination. The Company will pay the representatives of the underwriters a marketing fee for such services upon the consummation of a Business Combination in an amount equal to, in the aggregate, 4.5% of the gross proceeds of the Initial Public Offering, including any proceeds from the full or partial exercise of the underwriters’ over-allotment option. As a result, the representatives of the underwriters will not be entitled to such fee unless the Company consummates its initial business combination. | |
Reservoir Holdings Inc And Subsidiaries | |||
Contingencies and commitments | 16. Contingencies and commitments (a) The Company leases its business premises under an operating lease which have expiration dates between 2022 – 2024. Rent expense totaled $962,224 and $826,389 during the fiscal years ended March 31, 2021 and 2020, respectively. Future minimum lease payments are as follows: $ 2022 817,966 2023 586,303 2024 248,981 1,653,250 (b) In addition, the Company has committed to make payments for additional Royalty advances totaling $5,733,458 through March 2022, and a further $795,708 through March 2024, subject to certain conditions. These Royalty advances are to be used to fund future compositions and will be recorded as Royalty advances when paid. (c) As discussed in Note 8, the Company has obligations related to certain asset purchases and business acquisitions, which are recorded as liabilities. Some of those agreements call for additional amounts to be paid based on future performance of the assets. The Company has recorded liabilities based on its view of the future performance of those assets, but it is possible that the actual performance and resulting obligations may be different than current estimates. (d) On September 8, 2020, an action was filed in the United States District Court for the Southern District of New York against a consolidated subsidiary of the Company and certain prior owners (“Prior Owners”) of certain music copyrights acquired by the Company. The legal action asserts that in 2000, the plaintiff entered into certain engagement letters (the “Engagement Letters”) with certain of the Prior Owners, which purportedly gave the plaintiff, among other things, an exclusive right to broker any future sale by the Prior Owners of the music copyrights acquired by the Company as well as a commission fee. Based on the Engagement Letters’ alleged grant of a security interest in such music copyrights, the plaintiff filed financing statements and various notices of liens, in the amount of $2,651,125 , in the United States Copyright Office between 2000 and 2018. The plaintiff alleges, among other things, that the Prior Owners breached the Engagement Letters by consummating a purchase agreement with a consolidated subsidiary of the Company in 2018 without involving the plaintiff; that a consolidated subsidiary of the Company tortiously interfered with the Engagement Letters; and that the Plaintiff is permitted to foreclose on the lien, including foreclosing on those music copyrights acquired by a consolidated subsidiary of the Company under the 2018 purchase agreement. The Company determined a loss resulting from the action is not reasonably possible. The Company believes all claims and threatened claims against the consolidated subsidiary of the Company in this legal action are without merit and intends to defend vigorously against them. The Company also believes it has obtained appropriate indemnifications from the Prior Owners in relation to the claims in this legal action. In addition to the foregoing, the Company is subject to claims and contingencies in the normal course of business. To the extent the Company cannot predict the outcome of the claims and contingencies or estimate the amount of any loss that may result, no provision for any contingent liabilities has been made in the consolidated financial statements. The Company believes that losses resulting from these matters, if any, would not have a material adverse effect on the financial position, results of operations or cash flows of the Company. All such matters which the Company concludes are probable to result in a loss and for which management can reasonably estimate the amount of such loss have been accrued for within the accompanying consolidated financial statements. |
Segment reporting
Segment reporting | 12 Months Ended |
Mar. 31, 2021 | |
Reservoir Holdings Inc And Subsidiaries | |
Segment Reporting Information [Line Items] | |
Segment reporting | 17. Segment reporting The Company’s business is organized in two reportable segments: Music Publishing and Recorded Music. The Company identified its Chief Executive Officer as its Chief Operating Decision Maker (“CODM”). The Company’s CODM evaluates financial performance of its segments based on several factors, of which the primary financial measure is operating income before depreciation and amortization (“OIBDA”). While each segment incurs direct administration expenses reflected in segment income, all corporate-level administration expenses, such as executive management, are included in the Music Publishing segment and are not allocated between segments. The accounting policies of the Company’s business segments are the same as those described in the summary of significant accounting policies included elsewhere herein. The Company does not have sales between segments. The following tables present Total revenue and a reconciliation of OIBDA to operating income by segment for the fiscal years ended March 31, 2021 and 2020: Music Recorded For the Fiscal Year Ended March 31, 2021: Publishing Music Other Consolidated $ $ $ $ Total revenue 67,090,625 13,594,981 1,092,183 81,777,789 Reconciliation of OIBDA to operating income: Operating income 15,074,983 4,333,644 262,494 19,671,121 Amortization and depreciation 11,791,568 2,230,866 106,170 14,128,604 OIBDA 26,866,551 6,564,510 368,664 33,799,725 Music Recorded For the Fiscal Year Ended March 31, 2020: Publishing Music Other Consolidated $ $ $ $ Total revenue 53,942,236 9,028,496 267,940 63,238,672 Reconciliation of OIBDA to operating income: Operating income 13,637,115 1,708,568 131,630 15,477,313 Amortization and depreciation 6,653,020 1,770,177 — 8,423,197 OIBDA 20,290,135 3,478,745 131,630 23,900,510 The Company’s CODM manages assets on a consolidated basis. Accordingly, segment assets are not reported to the Company’s CODM, used to allocate resources or assess performance of the segments, and therefore, total segment assets have not been disclosed. Total long-lived assets by country are as follows as of and for the fiscal years ended March 31: 2021 2020 $ $ United States 187,861 339,420 United Kingdom 133,905 263,556 Total 321,766 602,976 During the fiscal years ended March 31, 2021 and 2020, a single external customer accounted for 12% and 15%, respectively, of total revenues, and is included in both the Music Publishing and Recorded Music segments. No other customer accounted for more than 10% of revenue. |
Subsequent events_2_3
Subsequent events | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | |
Subsequent Event [Line Items] | |||
Subsequent events | NOTE 11. SUBSEQUENT EVENTS The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the condensed financial statements were issued. Based upon this review, other than as described in Note 9 and below, the Company did not identify any subsequent events that would have required adjustment or disclosure in the condensed financial statements. On April 14, 2021, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Roth CH II Merger SubCorp. (“Merger Sub”) and Reservoir Holdings, Inc. (“Reservoir”). Pursuant to the terms of the Merger Agreement, the business combination (the “Business Combination”) between the Company and Reservoir will be effected through the merger of Merger Sub with and into Reservoir (the “Merger”), with Reservoir surviving the Merger as a wholly owned subsidiary of the Company. The Business Combination is subject to customary conditions to closing, including receipt of approval of the Company’s stockholders and the concurrent closing of a $150 million private placement of the Company’s common stock to certain institutional and accredited investors. There can be no assurance that such conditions will be satisfied or that the Business Combination will be consummated on the terms contemplated by the Merger Agreement. | NOTE 10 — SUBSEQUENT EVENTS The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the financial statements were issued. Based upon this review, other than as described below, the Company did not identify any subsequent events that would have required adjustment or disclosure in the financial statements. On February 15, 2021, the Company entered into a mutually exclusive non-binding letter of intent (the “Letter of Intent”) with a target company (“Target Company”) for a potential business combination which would qualify as its initial business combination (the “Business Combination”). Under the terms of the Letter of Intent, the Company and Target Company intend to enter into a definitive agreement pursuant to which the Company and Target Company would combine, with the former equity holders of both entities (following the completion of the Business Combination) holding equity in the combined publicly listed company. The completion of the Business Combination is subject to the completion of due diligence to the Company’s satisfaction, the negotiation and execution of definitive documentation and satisfaction of the conditions contained therein, including (i) completion of any required stock exchange and regulatory review and (ii) approval of the transaction by the Company’s stockholders and the Target Company’s stockholders. Accordingly, no assurances can be made by either party that the parties will successfully negotiate and enter into a definitive agreement, or that the proposed transaction will be consummated. | |
Reservoir Holdings Inc And Subsidiaries | |||
Subsequent Event [Line Items] | |||
Subsequent events | 18. Subsequent events (a) On April 14. 2021, the Company entered into a definitive merger agreement with Roth CH Acquisition Co. II (NASDAQ: ROCC) (“ROCC”), a publicly traded special purpose acquisition company with $115 million in trust. The transaction will be funded by a combination of ROCC’s cash held in its trust account (after any redemptions by its public stockholders in connection with the closing), a full equity roll-over from existing Company shareholders, and proceeds from a private placement of $150 million of common stock at $10.00 per share that will close concurrently with the merger. The board of directors of the Company and ROCC have unanimously approved the transaction. The transaction will require the approval of the stockholders of ROCC and is subject to other customary closing conditions. The transaction is expected to close in the third calendar quarter of 2021 and will be accounted for as a reverse recapitalization, with the Company determined to be the accounting acquirer. (b) On June 2, 2021, the Company acquired U.S. based record label and music publishing company Tommy Boy Music, LLC (“Tommy Boy”) for approximately $100 million. Two of the Company’s board members are also board members of Tommy Boy and have an equity interest in both companies. The acquisition of Tommy Boy will be accounted for as an asset acquisition as a result of the significant concentration of the fair value of gross assets acquired in a recorded music catalog intangible asset. (c) Subsequent events have been evaluated through June 25, 2021, which is the date these financial statements were available for issuance. |
Summary of significant accou_12
Summary of significant accounting policies (Policies) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X of the Securities and Exchange Commission (the “SEC”). Certain information or footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows. In the opinion of management, the accompanying unaudited condensed financial statements include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented. The accompanying unaudited condensed financial statements should be read in conjunction with the Company’s Annual report on Form 10-K, as filed with the SEC on March 29, 2021. The interim results for the three months ended March 31, 2021 are not necessarily indicative of the results to be expected for the period ending December 31, 2021 or for any future periods. | Basis of Presentation The accompanying financial statements are presented in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the SEC. | |
Use of significant accounting estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates. | Use of Estimates The preparation of financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates. | |
Cash and cash equivalents | Cash and Cash Equivalents The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The Company did not have any cash equivalents as of March 31, 2021 and 2020. | Cash and Cash Equivalents The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The Company did not have any cash equivalents as of December 31, 2020 and 2019. | |
Concentrations of credit risk | Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash accounts in a financial institution, which, at times may exceed the Federal Depository Insurance Coverage of $250,000. The Company has not experienced losses on these accounts. | Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist of a cash account in a financial institution, which, at times, may exceed the Federal Depository Insurance Coverage of $250,000. The Company has not experienced losses on this account. | |
Earnings per share | Net income (Loss) per Common Share Net income (loss) per share is computed by dividing net income (loss) by the weighted-average number of shares of common stock outstanding during the period, excluding shares of common stock subject to forfeiture. The Company has not considered the effect of the warrants sold in the Initial Public Offering and private placement to purchase an aggregate of 5,887,500 shares in the calculation of diluted loss per share, since the exercise of the warrants are contingent upon the occurrence of future events. The Company’s statement of operations includes a presentation of income (loss) per share for common shares subject to possible redemption in a manner similar to the two-class method of income (loss) per share. Net income (loss) per common share, basic and diluted, for Common stock subject to possible redemption is calculated by dividing the proportionate share of income or loss on marketable securities held by the Trust Account, net of applicable franchise and income taxes, by the weighted average number of Common stock subject to possible redemption outstanding since original issuance. Net income (loss) per share, basic and diluted, for non-redeemable common stock is calculated by dividing the net income (loss), adjusted for income or loss on marketable securities attributable to Common stock subject to possible redemption, by the weighted average number of non-redeemable common stock outstanding for the period. Non-redeemable common stock includes Founder Shares and non-redeemable shares of common stock as these shares do not have any redemption features. Non-redeemable common stock participates in the income or loss on marketable securities based on non-redeemable shares’ proportionate interest. The following table reflects the calculation of basic and diluted net income (loss) per common share (in dollars, except per share amounts): Three Months Three Months Ended Ended March 31, March 31, 2021 2020 Common stock subject to possible redemption Numerator: Earnings allocable to Common stock subject to possible redemption Interest earned on marketable securities held in Trust Account $ 5,973 $ — Unrealized gain on marketable securities held in Trust Account — — Less: interest available to be withdrawn for payment of taxes (5,973) — Net income $ — $ — Denominator: Weighted Average Common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Common stock subject to possible redemption 11,088,616 — Basic and diluted net income per share, Common stock subject to possible redemption $ 0.00 $ — Non-Redeemable Common Stock Numerator: Net Loss minus Net Earnings Net loss $ (247,531) $ (85) Net income allocable to Common stock subject to possible redemption — — Non-Redeemable Net Loss $ (247,531) $ (85) Denominator: Weighted Average Non-redeemable common stock — — Basic and diluted weighted average shares outstanding, Non-redeemable common stock 3,561,384 2,500,000 Basic and diluted net loss per share, Non-redeemable common stock $ (0.07) $ (0.00) | Net Income (Loss) per Common Share Net income (loss) per share is computed by dividing net income (loss) by the weighted-average number of shares of common stock outstanding during the period, excluding shares of common stock subject to forfeiture. At December 31, 2019, weighted average shares were reduced for the effect of an aggregate of 375,000 shares of common stock that were subject to forfeiture if the over-allotment option was not exercised by the underwriters (see Note 7). The Company has not considered the effect of the warrants sold in the Initial Public Offering and private placement to purchase an aggregate of 5,887,500 shares in the calculation of diluted loss per share, since the exercise of the warrants are contingent upon the occurrence of future events. The Company’s statement of operations includes a presentation of income (loss) per share for common shares subject to possible redemption in a manner similar to the two-class method of income (loss) per share. Net income (loss) per common share, basic and diluted, for Common stock subject to possible redemption is calculated by dividing the proportionate share of income or loss on marketable securities held by the Trust Account, net of applicable franchise and income taxes, by the weighted average number of Common stock subject to possible redemption outstanding since original issuance. Net income (loss) per share, basic and diluted, for non-redeemable common stock is calculated by dividing the net income (loss), adjusted for income or loss on marketable securities attributable to Common stock subject to possible redemption, by the weighted average number of non-redeemable common stock outstanding for the period. Non-redeemable common stock includes Founder Shares and non-redeemable shares of common stock as these shares do not have any redemption features. Non-redeemable common stock participates in the income or loss on marketable securities based on non-redeemable shares’ proportionate interest. The following table reflects the calculation of basic and diluted net income (loss) per common share (in dollars, except per share amounts): For the Period from February 13, 2019 Year Ended (inception) December 31, through 2020 December 31, 2019 Common stock subject to possible redemption Numerator: Earnings allocable to Common stock subject to possible redemption Interest earned on marketable securities held in Trust Account $ 5,785 $ — Unrealized gain on marketable securities held in Trust Account 828 — Less: interest available to be withdrawn for payment of taxes (6,613) — Net income $ — $ — Denominator: Weighted Average Common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Common stock subject to possible redemption 11,111,752 — Basic and diluted net income per share, Common stock subject to possible redemption $ 0.00 $ — Non-Redeemable Common Stock Numerator: Net Loss minus Net Earnings Net loss $ (103,385) $ (1,225) Net income allocable to Common stock subject to possible redemption — — Non-Redeemable Net Loss $ (103,385) $ (1,225) Denominator: Weighted Average Non-redeemable common stock Basic and diluted weighted average shares outstanding, Non-redeemable common stock 2,545,512 2,500,000 Basic and diluted net loss per share, Non-redeemable common stock $ (0.04) $ (0.00) | |
Income taxes | Income Taxes The Company follows the asset and liability method of accounting for income taxes under ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of March 31, 2021 and December 31, 2020. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company is subject to income tax examinations by major taxing authorities since inception. The effective tax rate differs from the statutory tax rate of 21% for the three months ended March 31, 2021 and 2020, due to the valuation allowance recorded on the Company’s net operating losses. | Income Taxes The Company follows the asset and liability method of accounting for income taxes under ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of December 31, 2020 and 2019. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company is subject to income tax examinations by major taxing authorities since inception. On March 27, 2020, the CARES Act was enacted in response to COVID-19 pandemic. Under ASC 740, the effects of changes in tax rates and laws are recognized in the period which the new legislation is enacted. The CARES Act made various tax law changes including among other things (i) increasing the limitation under Section 163(j) of the Internal Revenue Code of 1986, as amended (the “IRC”) for 2019 and 2020 to permit additional expensing of interest (ii) enacting a technical correction so that qualified improvement property can be immediately expensed under IRC Section 168(k), (iii) making modifications to the federal net operating loss rules including permitting federal net operating losses incurred in 2018, 2019, and 2020 to be carried back to the five preceding taxable years in order to generate a refund of previously paid income taxes and (iv) enhancing the recoverability of alternative minimum tax credits. Given the Company’s full valuation allowance position and capitalization of all costs, the CARES Act did not have an impact on the financial statements. | |
Recent Accounting Pronouncements | Recent Accounting Standards Management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s condensed financial statements. | Recent Accounting Standards Management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s financial statements. | |
Reservoir Holdings Inc And Subsidiaries | |||
Basis of Presentation | Basis of presentation These consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”). In the opinion of management, all adjustments considered necessary for a fair presentation have been included. The following include significant accounting policies that have been adopted by the Company: | ||
Principles of consolidation | (a) Principles of consolidation The consolidated financial statements include the accounts of the Company, its wholly-owned subsidiaries and its majority-owned subsidiaries. The Company records a noncontrolling interest in its consolidated balance sheets and statements of operations with respect to the remaining economic interests in majority-owned subsidiaries it does not own. All intercompany transactions and balances have been eliminated upon consolidation. The equity method of accounting is used to account for investments in entities in which the Company has the ability to exert significant influence over the investee’s operating and financial polices. As of March 31, 2021 and 2020, the Company was not involved with any entities identified as variable interest entities. | ||
Use of significant accounting estimates | (b) Use of significant accounting estimates The preparation of consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and the related disclosure of contingent assets and liabilities. Significant estimates are used for, but not limited to, determining useful lives of intangible assets, intangible asset recoverability and impairment and accrued revenue. Actual results could differ from these estimates. | ||
Foreign currencies | (c) Foreign currencies The Company has determined the U.S. dollar to be the functional currency of the Company and certain subsidiaries as it is the currency of the primary economic environment in which the companies operate while other subsidiaries have been determined to have the British Pound as their functional currencies. (i) Transactions and balances Monetary assets and liabilities denominated in foreign currencies other than the functional currency are translated into the respective functional currencies at the exchange rate in effect at the balance sheet date and non-monetary assets and liabilities at the exchange rates in effect at the time of acquisition or issue. Revenues and expenses are translated at rates approximating the exchange rates in effect at the time of the transactions. All exchange gains and losses are included in operations. (ii) Translation Financial statements of subsidiaries with functional currencies other than the U.S. dollar are translated into the presentation currency using the current rate method. Under this method, assets and liabilities are translated at the rate of exchange in effect at the balance sheet date. Revenue and expenses are translated at the average rate of exchange for the fiscal year. Exchange gains and losses are deferred and reflected on the balance sheet in accumulated other comprehensive income and subsequently recognized in income upon substantial disposal of the net investment in the foreign operation. | ||
Cash and cash equivalents | (d) Cash and cash equivalents The Company considers all highly liquid investments with maturities of three months or less at the date of purchase to be cash equivalents. | ||
Restricted cash | (e) Restricted cash Prior to their repurchase, pursuant to the terms of the indenture agreement in connection with the issuance of secured notes, RMM Issuer, a subsidiary of the Company, was required to maintain a trust account in the name of the indenture trustee (the “Trustee”) into which royalty payments received, advances and other collections were required to be deposited after deduction of the applicable writer’s share. On a semi-annual basis, the Trustee distributed the amounts collected to various interested parties as fees for services or, in the case of secured note holders, for the payment of interest and principal. This arrangement was terminated upon the Company’s purchase of the secured notes on April 2, 2019 (see Note 7). | ||
Accounts receivable | (f) Accounts receivable Credit is extended to customers based upon an evaluation of the customer’s financial condition. The time between the Company’s issuance of an invoice and payment due date is not significant. Customer payments that are not collected in advance of the transfer of promised services or goods are generally due 30-60 days from invoice date. The Company monitors customer credit risk related to accounts receivable and, when deemed necessary, maintains a provision for estimated uncollectible accounts, which is estimated based on historical experience, aging trends and in certain cases, management judgments about specific customers. Based on this analysis, the Company did not record a provision for estimated uncollectible accounts at March 31, 2021 or 2020. | ||
Concentrations of credit risk | (g) Concentrations of credit risk Customer credit risk represents the potential for financial loss if a customer is unwilling or unable to meet its agreed upon contractual payment obligations. Two customers accounted for approximately 43% of total accounts receivable at March 31, 2021 and three customers accounted for approximately 67% of total accounts receivable at March 31, 2020. No other single customer accounted for more than 10% of accounts receivable in either period. In the Music Publishing business, the Company collects a significant portion of its royalties from global copyright collecting societies. Collecting societies and associations generally are not-for-profit organizations that represent composers, songwriters and music publishers. These organizations seek to protect the rights of their members by licensing, collecting license fees and distributing royalties for the use of the members’ works. The Company does not believe there is any significant collection risk from such societies. In the Recorded Music business, the majority of the revenue is collected from the Company’s distribution partners rather than directly from many customers. Those distribution partners pay through the revenue to the Company on a monthly basis. The Company routinely assesses the financial strength of its distribution partners and the Company does not believe there is any significant collection risk. | ||
Acquisitions and business combinations | (h) Acquisitions and business combinations In conjunction with each acquisition transaction, the Company assesses whether the transaction should follow accounting guidance applicable to an asset acquisition or a business combination. This assessment requires an evaluation of whether the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets, resulting in an asset acquisition or, if not, resulting in a business combination. If treated as an asset acquisition, the asset is recorded in accordance with the Company’s intangible asset policy and related acquisition costs are capitalized as part of the asset. In a business combination, the Company recognizes identifiable assets acquired, liabilities assumed, and non-controlling interests at their fair values at the acquisition date. Any consideration paid in excess of the net fair value of the identifiable assets and liabilities acquired in a business combination is recorded to goodwill and acquisition-related costs are expensed as incurred. | ||
Intangible assets | (i) Intangible assets Intangible assets consist primarily of music catalogs (publishing and recorded). Intangible assets are recorded at fair value in a business combination and relative fair value in an asset acquisition. Intangible assets are amortized over their expected useful lives using the straight-line method. The Company periodically reviews the carrying value of its amortizable intangible assets, whenever events or changes in circumstances indicate that the carrying value may not be recoverable or that the lives assigned may no longer be appropriate. To the extent the estimated future cash inflows attributable to the asset, less estimated future cash outflows, are less than the carrying amount, an impairment loss is recognized in an amount equal to the difference between the carrying value of such asset and its fair value. If it is determined that events and circumstances warrant a revision to the remaining period of amortization, an asset’s remaining useful life would be changed, and the remaining carrying amount of the asset would be amortized prospectively over that revised remaining useful life. | ||
Goodwill | (j) Goodwill The Company has $402,067 of goodwill at March 31, 2021 and 2020, which is classified with Other assets in the Company’s consolidated balance sheet. All of the goodwill arose in connection with an acquisition on December 29, 2019 (see Note 4) and has been assigned to a reporting unit within the Music Publishing segment. There was no impairment, disposals, or other acquisitions of goodwill in the fiscal years ended March 31, 2021 and 2020. Goodwill represents the future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. The Company evaluates goodwill for potential impairment on an annual basis on the first day of the fiscal fourth quarter (January 1), or at other times during the year if events or circumstances indicate that it is more-likely-than-not (greater than 50%) that the fair value of a reporting unit, is below the carrying amount. In reviewing goodwill for impairment, the Company has the option to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more-likely-than-not that the estimated fair value of a reporting unit is less than its carrying amount. If the Company elects to bypass the qualitative assessment for any reporting unit, or if a qualitative assessment indicates it is more-likely-than-not that the estimated fair value of a reporting unit is less than its carrying amount, the Company performs a quantitative goodwill impairment test by comparing the fair value of the reporting unit with its carrying amount. If the fair value of the reporting unit is less than its carrying amount, the Company will measure any goodwill impairment loss as the amount by which the carrying amount of a reporting unit exceeds its fair value, not to exceed the total amount of goodwill allocated to that reporting unit. | ||
Investments in equity affiliates | (k) Investments in equity affiliates The Company holds 50% interests in two | ||
Deferred revenue | (l) Deferred revenue Deferred revenue principally relates to fixed fees and minimum guarantees received in advance of the Company’s performance or usage by the licensee. Reductions in deferred revenue are a result of the Company’s performance under the contract or usage by the licensee. | ||
Deferred finance costs | (m) Deferred finance costs Deferred finance costs consist of costs incurred in connection with the issuance of secured notes payable and bank loans and are amortized on an effective interest basis over the original term of the related obligation. Deferred finance charges are netted against the debt (see Note 7). | ||
Deferred charges | (n) Deferred charges Deferred charges consist of direct costs incurred in connection with the potential acquisition of entertainment interests in music compositions pursued by the Company. Such costs are deferred when closing of the transaction is deemed probable and are added to the cost of the asset once acquired or expensed if the acquisition does not proceed. | ||
Revenues | (o) Revenues The Company recognizes revenue when, or as, control of the promised services or goods is transferred to its customers and in an amount that reflects the consideration the Company is contractually due in exchange for those services or goods. Music Publishing Music Publishing revenues are earned in the form of royalties relating to the licensing of rights in musical compositions and the sale of published sheet music and songbooks. Royalties principally relate to amounts earned from the public performance of musical compositions, the mechanical reproduction of musical compositions on recorded media including digital formats and the use of musical compositions in synchronization with visual images. Music publishing royalties, except for synchronization royalties, are recognized when the sale or usage occurs. The most common form of consideration for publishing contracts is sales- and usage-based royalties. The collecting societies submit usage reports, typically with payment for royalties due, often on a quarterly or biannual reporting period, in arrears. Royalties are recognized as the sale or usage occurs based upon usage reports when these reports are available for the reporting period or estimates of royalties based on historical data, such as recent royalties reported, company-specific information with respect to changes in repertoire, industry information and other relevant trends when usage reports are not available for the reporting period. Synchronization revenue is recognized as revenue when control of the license is transferred to the customer. Recorded Music Revenues from the sale or license of Recorded Music products through digital distribution channels are recognized when the sale or usage occurs based on usage reports received from the customer. Digital licensing contracts are generally long-term with consideration in the form of sales- and usage-based royalties that are received monthly. For certain licenses where the consideration is fixed and the intellectual property being licensed is static, revenue is recognized at the point in time when control of the licensed content is transferred to the customer. Revenues from the sale of physical Recorded Music products are recognized upon delivery, which occurs once the product has been shipped and control has been transferred. | ||
Principal versus agent revenue recognition | (p) Principal versus agent revenue recognition The Company reports revenue on a gross or net basis based on management’s assessment of whether the Company acts as a principal or agent in the transaction. The determination of whether the Company acts as a principal or an agent in a transaction is based on an evaluation of whether the Company controls the good or service before transfer to the customer. When the Company concludes that it controls the good or service before transfer to the customer, the Company is considered a principal in the transaction and records revenue on a gross basis. When the Company concludes that it does not control the good or service before transfer to the customer but arranges for another entity to provide the good or service, the Company acts as an agent and records revenue on a net basis in the amount it earns for its agency service. The Company is typically required to pay a specified portion of the fees, earnings, payments and revenues received from the exploitation of the underlying music compositions to the original songwriter (“Royalty Costs”). The Company records revenues on a gross basis reflecting its position as a principal in the transaction and any royalties payable to third parties, including the Writer’s Fees, are recorded as expenses. | ||
Royalty costs and royalty advances | (q) Royalty costs and royalty advances The Company incurs royalty costs that are payable to its recording artists and songwriters generated from the sale or license of its music publishing copyrights and recorded music catalog. Royalties are calculated using negotiated rates in accordance with recording artist and songwriter contracts. Calculations are based on revenue earned or user/usage measures or a combination of these. There are instances where such data is not available to be processed and royalty cost calculations may be complex or involve judgments about significant volumes of data to be processed and analyzed. In many instances, the Company commits to pay its recording artists and songwriters royalties in advance of future sales. The Company accounts for these advances under the related guidance in FASB ASC Topic 928, Entertainment — Music (“ASC 928”). Under ASC 928, the Company capitalizes as assets certain advances, which it believes are recoverable from future royalties to be earned by the recording artist or songwriter, when paid. Recoverability is assessed upon initial commitment of the advance based upon the Company’s forecast of anticipated revenue from the sale of future and existing albums or musical compositions. In determining whether the advance is recoverable, the Company evaluates the current and past popularity of the recording artist or songwriter, the sales history of the recording artist or songwriter, the initial or expected commercial acceptability of the product, the current and past popularity of the genre of music that the product is designed to appeal to, and other relevant factors. Advances vary in both amount and expected life based on the underlying recording artist or songwriter. To the extent that a portion of an outstanding advance is no longer deemed recoverable, that amount will be expensed in the period the determination is made. | ||
Share-based compensation | (r) Share-based compensation Compensation expense related to the issuance of share-based awards to the Company’s employees is measured at fair value on the grant date. We use the Black-Scholes option pricing model to value stock options. The compensation expense for awards that vest over a future service period is recognized over the requisite service period on a straight-line basis. The Company recognizes share-based award forfeitures as they occur rather than estimating by applying a forfeiture rate. | ||
Earnings per share | (s) Earnings per share The consolidated statements of income present basic and diluted earnings per share (“EPS”). Basic earnings per share is computed using the two-class method which includes the weighted average number of shares of common stock outstanding during the period and other securities that participate in dividends (a “participating security”). Since the Preferred Shares (as defined in Note 12) participate in dividends alongside the Company’s common shares, the Preferred Shares constitute participating securities. Under the two-class method, all earnings (distributed and undistributed) are allocated to common shares and participating securities based on their respective rights to receive dividends. Diluted earnings per share is computed similar to basic earnings per share except that the denominator is increased to include the number of additional shares for potential dilutive effects of the Preferred Shares and stock options outstanding during the period. The dilutive effects of the Preferred Shares are calculated in accordance with the if-converted method, or two-class method, whichever is more dilutive and the dilutive effects of stock options is calculated in accordance with the treasury stock method. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive. | ||
Employee Benefit Plans | (t) Employee Benefit Plans The Company has a 401(k) retirement savings plan (the “RHI Plan”) open to U.S. based employees who have completed three months of eligible service. The Company contributes $0.60 for every $1.00 of employee contributions up to a maximum of 6% of the employee’s salary based upon each individual participant’s election. Expenses totaled $109,265 and $98,000 for employer contributions to the RHI Plan in the fiscal years ended March 31, 2021 and 2020, respectively. | ||
Income taxes | (u) Income taxes Income taxes are determined using the asset and liability method of accounting. Under this method, deferred tax assets and liabilities are recognized for the differences between the accounting bases of assets and liabilities and their corresponding tax basis. Deferred taxes are measured using enacted tax rates expected to apply when the asset is realized, or the liability is settled. A deferred tax asset is recognized when it is considered more likely than not to be realized. Through April 24, 2019, the Company filed income taxes as part of a consolidated group return with the Company’s then sole shareholder, Wesbild, Inc. Income taxes for the period subsequent to April 24, 2019 have been filed separately by the Company. RMM has elected to treat taxes on GILTI as period costs and no deferred tax asset or liability is recorded. | ||
Comprehensive income | (v) Comprehensive income The Company reports in accordance with ASC 220, Comprehensive Income. This standard requires companies to classify items of other comprehensive income/loss by their nature in the financial statements and display the accumulated balance of other comprehensive income (loss) separately from capital stock and accumulated deficit in the shareholders’ equity section of a statement of financial position. | ||
Derivative financial instruments | (w) Derivative financial instruments The Company’s interest rate swaps have not been designated as a hedging instrument and, therefore, are recognized at fair value at the end of each reporting period with changes in fair value recorded in income. | ||
Fair value measurement and hierarchy | (x) Fair value measurement and hierarchy The Company reports in accordance with ASC 820, Fair Value Measurements and Disclosures, (“ASC 820”). Under this standard, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e., the “exit price”) in an orderly transaction between market participants at the measurement date. ASC 820 establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions as to what market participants would use in pricing the asset or liability and are based on the best information available in the circumstances. The hierarchy is broken down into three levels based on the observability of inputs as follows: ● Level 1 — Valuations based on quoted prices in active markets for identical assets or liabilities that the Company has the ability to access. Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these products does not entail a significant degree of judgment. ● Level 2 — Valuations based on one or more quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly. ● Level 3 — Valuations based on inputs that are unobservable and significant to the overall fair value measurement. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes the level in the fair value hierarchy within which the fair value measurement falls is determined based on the lowest level input that is significant to the fair value measurement in its entirety. See Note 15. | ||
Recent Accounting Pronouncements | (y) Recent Accounting Pronouncements Accounting Standards Not Yet Adopted As an “emerging growth company” (“EGC”), the Jumpstart Our Business Startups Act (“JOBS Act”) allows the Company to delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are made applicable to private companies. The Company has elected to use this extended transition period under the JOBS Act. The adoption dates discussed below reflect this election. In February 2016, the FASB issued ASU 2016-02, Leases: (Topic 842) (“ASU 2016-02”), which establishes a right-of-use (“ROU”) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the consolidated statements of income. For public entities, this guidance was effective for annual reporting periods beginning after December 15, 2018, including interim periods within that annual reporting period. Under the guidance of ASU 2020-05, the new standard is effective for the Company April 1, 2022 and interim periods within the fiscal year beginning April 1, 2023. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company has not yet completed an analysis of the impact of the new lease guidance. Under current accounting guidance for leases, the Company does not recognize an asset or liability created by operating leases where the Company is the lessee. Therefore, the Company expects an increase to its assets and liabilities on the Company’s consolidated balance sheet as a result of recognizing assets and liabilities for operating leases where the Company is the lessee on the date of initial application of the new guidance. However, the Company cannot currently quantify this increase or the impact, if any, on its consolidated statements of income. The Company does not expect the adoption of this new guidance will have a material impact on the amount or timing of the Company’s cash flows or liquidity. In June 2016, the FASB issued ASU 2016-13, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which replaces the incurred loss impairment methodology in current US GAAP, with a methodology that reflects expected credit losses. Subsequent to ASU 2016-13, the FASB has issued several related ASUs amending the original ASU. The updates are intended to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. For public entities, this guidance was effective for annual reporting periods beginning after December 15, 2019, including interim periods within that annual reporting period. For the Company, this update is effective April 1, 2023, including interim periods within that fiscal year, with early adoption permitted for annual periods beginning after December 15, 2018. The Company has not yet evaluated the effect that this ASU will have on the Company’s consolidated financial statements. In April 2020, the FASB issued Accounting Standards Update No. 2020-04, Reference Rate Reform (Topic 848) (“ASU 2020-04”), which provides optional guidance for a limited period of time to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting; particularly as it relates to the risk of cessation of LIBOR. The amendments in this ASU apply only to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. The expedients and exceptions provided by this ASU do not apply to contract modifications made and hedging relationships entered into or evaluated after December 31, 2022, except for hedging relationships existing as of December 31, 2022, that an entity has elected certain optional expedients for and that are retained through the end of the hedging relationship. The Company has not yet evaluated the effect that this ASU will have on the Company’s consolidated financial statements. |
Revenue recognition (Tables)
Revenue recognition (Tables) - Reservoir Holdings Inc And Subsidiaries | 12 Months Ended |
Mar. 31, 2021 | |
Schedule of revenue | The Company’s revenue consists of the following categories during the fiscal years ended March 31: 2021 2020 $ $ Revenue by Type Performance 16,514,790 13,656,061 Digital 35,028,049 28,798,051 Mechanical 3,050,120 2,472,527 Synchronization 9,891,034 6,891,554 Other 2,606,632 2,124,043 Total Music Publishing 67,090,625 53,942,236 Digital 7,603,040 4,569,106 Physical 3,962,596 1,432,026 Synchronization 492,258 1,384,959 Neighboring rights 1,537,087 1,642,405 Total Recorded Music 13,594,981 9,028,496 Other revenue 1,092,183 267,940 Total revenues 81,777,789 63,238,672 2021 2020 $ $ Revenue by Geographical Location United States Music Publishing 34,682,505 30,803,165 United States Recorded Music 4,891,800 3,475,647 United States other revenue 1,092,183 267,940 Total United States 40,666,488 34,546,752 International Music Publishing 32,408,121 23,139,071 International Recorded Music 8,703,180 5,552,849 Total international 41,111,301 28,691,920 Total revenues 81,777,789 63,238,672 |
Schedule of change in deferred revenue | The following table reflects the change in deferred revenue during the fiscal years ended March 31: 2021 2020 $ $ Balance at beginning of period 473,022 287,406 Cash received during period 6,716,569 347,407 Revenue recognized during period (5,851,604) (161,791) Balance at end of period 1,337,987 473,022 |
Intangible assets (Tables)
Intangible assets (Tables) - Reservoir Holdings Inc And Subsidiaries | 12 Months Ended |
Mar. 31, 2021 | |
Schedule of intangible assets subject to amortization | Intangible assets subject to amortization consist of the following at March 31: March 31, March 31, 2021 2020 $ $ Intangible assets subject to amortization: Music catalogs (publishing and recorded) 457,662,303 335,137,807 Artist management contracts 995,464 925,398 Gross intangible assets 458,657,767 336,063,205 Accumulated amortization (65,419,757) (50,954,097) Intangible assets, net 393,238,010 285,109,108 |
Schedule of expected amortization expense of intangible assets | $ 2022 14,864,256 2023 14,864,256 2024 14,864,256 2025 14,864,256 2026 14,864,256 Thereafter 318,916,730 Total 393,238,010 |
Royalty advances (Tables)
Royalty advances (Tables) | 12 Months Ended |
Mar. 31, 2021 | |
Reservoir Holdings Inc And Subsidiaries | |
Schedule of royalty advances | 2021 2020 $ $ Opening balance 40,263,439 33,350,939 Additions 14,474,288 21,130,420 Recoupments (13,155,647) (14,217,920) Closing balance 41,582,080 40,263,439 |
Loans and secured notes payab_2
Loans and secured notes payable (Tables) - Reservoir Holdings Inc And Subsidiaries | 12 Months Ended |
Mar. 31, 2021 | |
Schedule of Long-term debt | 2021 2020 $ $ Secured loan bearing interest at LIBOR plus a spread 18,500,000 19,500,000 2021 2020 $ $ Secured line of credit bearing interest at LIBOR plus a spread 197,090,848 156,490,848 Debt issuance costs, net (3,058,973) (3,205,416) 212,531,875 172,785,432 Less: short term portion of Secured loan 1,000,000 1,000,000 211,531,875 171,785,432 |
Schedule of Expected principal repayment | As of March 31, 2021, the expected principal repayment is as follows: $ 2022 1,000,000 2023 1,000,000 2024 213,590,848 215,590,848 |
Other non-current liabilities (
Other non-current liabilities (Tables) | 12 Months Ended |
Mar. 31, 2021 | |
Reservoir Holdings Inc And Subsidiaries | |
Schedule of Other non-current liabilities consist primarily of obligations related to certain asset purchases and acquisitions | At March 31, 2021, the Company’s other non-current liabilities, which consist primarily of obligations related to certain asset purchases and acquisitions that are due more than a year in the future, are as follows: $ 2023 5,738,348 2024 213,783 2025 213,783 2026 and later 574,057 6,739,971 |
Income taxes (Tables)
Income taxes (Tables) | 12 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | |
Schedule of provision for income taxes | December 31, December 31, 2020 2019 Federal Current $ — $ — Deferred (21,711) (257) State and Local Current — — Deferred — — Change in valuation allowance 21,711 257 Income tax provision $ — $ — | |
Schedule of reconciliation of the statutory tax rate to the effective rate | A reconciliation of the statutory tax rate to the effective rate is as follows for the fiscal years ended March 31: 2021 2020 Federal income tax statutory rate 21.0 % 21.0 % State and local income taxes, net of federal income tax benefit 1.7 % 1.4 % Foreign subsidiary earnings 2.1 % 0.4 % Return to provision adjustments (4.9) % (1.5) % Impact of change in tax rates 0.3 % 8.2 % Other, net (1.0) % 0.1 % Effective income tax rate 19.2 % 29.6 % | December 31, December 31, 2020 2019 Statutory federal income tax rate 21.0 % 21.0 % State taxes, net of federal tax benefit 0.0 % 0.0 % Meals and entertainment 0.0 % 0.0 % Valuation allowance (21.0) (21.0) Income tax provision 0.0 % 0.0 % |
Schedule of significant components of the deferred income tax liability | Significant components of the Company’s deferred income tax liability at March 31 are as follows: 2021 2020 $ $ Deferred tax assets: Net operating loss carryforward 785,902 481,360 Fair value of swaps 1,046,459 1,718,059 Compensation 44,375 20,682 Charitable contributions 8,951 — Unrealized foreign exchange losses 51,924 — Total deferred tax assets 1,937,611 2,220,101 Deferred tax liabilities: Fixed assets and leasehold improvements (44,393) (72,006) Intangible assets (21,628,755) (18,563,334) Deferred charges — — Total deferred tax liabilities (21,673,148) (18,635,340) Net deferred tax liabilities (19,735,537) (16,415,239) | December 31, December 31, 2020 2019 Deferred tax assets Net operating loss carryforward $ 17,142 $ 257 Unrealized gain on marketable securities (1,389) — Startup and organizational costs 6,215 — Total deferred tax assets 21,968 257 Valuation Allowance (21,968) (257) Deferred tax assets $ — $ — |
Reservoir Holdings Inc And Subsidiaries | ||
Schedule of domestic and foreign income before income taxes | The following table presents domestic and foreign income before income taxes for the fiscal years ended March 31: 2021 2020 $ $ Domestic 11,126,090 12,174,556 Foreign 1,663,697 2,035,352 Income before income taxes 12,789,787 14,209,908 | |
Schedule of provision for income taxes | The provision for income taxes consists of the following for the fiscal years ended March 31: 2021 2020 $ $ Current income taxes: U.S. federal (216,528) 236,057 State and local 8,827 192,141 Foreign 581,232 119,709 Total current 373,531 547,907 Deferred income taxes: U.S. federal 2,188,194 2,775,979 State and local 259,182 (114,785) Foreign (366,754) 990,040 Total deferred 2,080,622 3,651,234 Income tax expense 2,454,153 4,199,141 | |
Schedule of reconciliation of the statutory tax rate to the effective rate | A reconciliation of the statutory tax rate to the effective rate is as follows for the fiscal years ended March 31: 2021 2020 Federal income tax statutory rate 21.0 % 21.0 % State and local income taxes, net of federal income tax benefit 1.7 % 1.4 % Foreign subsidiary earnings 2.1 % 0.4 % Return to provision adjustments (4.9) % (1.5) % Impact of change in tax rates 0.3 % 8.2 % Other, net (1.0) % 0.1 % Effective income tax rate 19.2 % 29.6 % | |
Schedule of significant components of the deferred income tax liability | Significant components of the Company’s deferred income tax liability at March 31 are as follows: 2021 2020 $ $ Deferred tax assets: Net operating loss carryforward 785,902 481,360 Fair value of swaps 1,046,459 1,718,059 Compensation 44,375 20,682 Charitable contributions 8,951 — Unrealized foreign exchange losses 51,924 — Total deferred tax assets 1,937,611 2,220,101 Deferred tax liabilities: Fixed assets and leasehold improvements (44,393) (72,006) Intangible assets (21,628,755) (18,563,334) Deferred charges — — Total deferred tax liabilities (21,673,148) (18,635,340) Net deferred tax liabilities (19,735,537) (16,415,239) | |
Schedule of net operating loss carry forwards | At March 31, 2021, the Company has income tax Net operating loss carry forwards of $48,971,281 related to the US operations. The Company has recorded a deferred tax asset of $785,902 reflecting the benefit of $48,971,281 in loss carry forwards. Such net operating loss carry forwards will expire as follows: Federal $ 1,795,951 No expiration date New York 46,903,391 2035 – 2040 California 151,988 2040 Tennessee 119,951 2035 |
Supplementary cash flow infor_2
Supplementary cash flow information (Tables) | 12 Months Ended |
Mar. 31, 2021 | |
Reservoir Holdings Inc And Subsidiaries | |
Summary of interest paid and income taxes paid | Summary of interest paid and income taxes paid for the fiscal years ended March 31 comprised the following: 2021 2020 $ $ Interest paid 8,176,888 6,099,653 Income taxes paid 131,414 205,067 |
Amounts due to _ (from) relat_2
Amounts due to / (from) related parties (Tables) | 12 Months Ended |
Mar. 31, 2021 | |
Reservoir Holdings Inc And Subsidiaries | |
Schedule of transactions with majority shareholder and other affiliated entities under the control of its majority shareholder | 2021 2020 $ $ Due to Wesbild Inc. Unsecured, bears no interest, with no specific terms of repayment — — Due to Wesbild Holdings Ltd., parent company of Wesbild Inc. Unsecured, bears no interest, with no specific terms of repayment 83,480 7,665 Sub-total 83,480 7,665 Due to (from) DRI Capital Inc., a subsidiary of Wesbild Holdings Ltd. Unsecured, bears no interest, with no specific terms of repayment 81,738 (60,444) Due to Reservoir Media Management (Canada) Inc., a subsidiary of Wesbild Holdings Ltd. Unsecured, bears no interest, with no specific terms of repayment 124,954 47,108 Sub-total 206,692 (13,336) 290,172 (5,671) |
Share-based compensation (Table
Share-based compensation (Tables) | 12 Months Ended |
Mar. 31, 2021 | |
Reservoir Holdings Inc And Subsidiaries | |
Summary of stock option activity | The following table is a summary of stock option activity under the Plan for the fiscal year ended March 31, 2021: Weighted Average Weighted Remaining Total Average Aggregate Contractual Number of Exercise Intrinsic Term Options Price Value (Years) $ $ Outstanding at April 1, 2020 7,624 1,000 Granted — Exercised — Forfeited — Outstanding at March 31, 2021 7,624 1,000 4,933,306 8.1 Exercisable at March 31, 2021 — — Vested or expected to vest at March 31, 2021 7,624 1,000 4,933,306 8.1 |
Earnings per share (Tables)
Earnings per share (Tables) | 12 Months Ended |
Mar. 31, 2021 | |
Reservoir Holdings Inc And Subsidiaries | |
Schedule of Earnings Per Share, Basic, by Common Class, Including Two Class Method [Table Text Block] | The following table summarizes the basic and diluted earnings per share calculations for the fiscal years ended March 31: 2021 2020 Basic earnings per common share Net income attributable to Reservoir Holdings Inc. $ 10,288,961 $ 10,057,794 Less: income allocated to participating securities (3,736,121) $ (3,435,754) Net income attributable to common shareholders $ 6,552,840 $ 6,622,040 Basic weighted average common shares outstanding 144,698 128,875 Basic earnings per common share $ 45.29 $ 51.38 Diluted earnings per common share Net income attributable to common shareholders $ 6,552,840 $ 6,622,040 Add: income allocated to participating securities 3,736,121 3,435,754 Net income attributable to Reservoir Holdings Inc. $ 10,288,961 $ 10,057,794 Basic weighted average common shares outstanding 144,698 128,875 Impact of assumed preferred share conversion 82,500 66,865 Diluted weighted average common shares outstanding 227,198 195,740 Diluted earnings per common share $ 45.29 $ 51.38 |
Contingencies and commitments (
Contingencies and commitments (Tables) | 12 Months Ended |
Mar. 31, 2021 | |
Reservoir Holdings Inc And Subsidiaries | |
Schedule of future minimum lease payments | $ 2022 817,966 2023 586,303 2024 248,981 1,653,250 |
Segment reporting (Tables)
Segment reporting (Tables) - Reservoir Holdings Inc And Subsidiaries | 12 Months Ended |
Mar. 31, 2021 | |
Schedule of total revenue and a reconciliation of OIBDA to operating income by segment | Music Recorded For the Fiscal Year Ended March 31, 2021: Publishing Music Other Consolidated $ $ $ $ Total revenue 67,090,625 13,594,981 1,092,183 81,777,789 Reconciliation of OIBDA to operating income: Operating income 15,074,983 4,333,644 262,494 19,671,121 Amortization and depreciation 11,791,568 2,230,866 106,170 14,128,604 OIBDA 26,866,551 6,564,510 368,664 33,799,725 Music Recorded For the Fiscal Year Ended March 31, 2020: Publishing Music Other Consolidated $ $ $ $ Total revenue 53,942,236 9,028,496 267,940 63,238,672 Reconciliation of OIBDA to operating income: Operating income 13,637,115 1,708,568 131,630 15,477,313 Amortization and depreciation 6,653,020 1,770,177 — 8,423,197 OIBDA 20,290,135 3,478,745 131,630 23,900,510 |
Schedule of total long-lived assets by country | Total long-lived assets by country are as follows as of and for the fiscal years ended March 31: 2021 2020 $ $ United States 187,861 339,420 United Kingdom 133,905 263,556 Total 321,766 602,976 |
Description of business (Detail
Description of business (Details) - Reservoir Holdings Inc And Subsidiaries | Mar. 16, 2020 | Apr. 27, 2007itemsegment | Mar. 31, 2021USD ($) | Apr. 23, 2019 |
Subsidiary, Sale of Stock [Line Items] | ||||
Reverse stock split ratio | 1 | |||
Number of operating segments | segment | 2 | |||
PPP Loan | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Borrowed amount | $ | $ 616,847 | |||
Minimum | Music Publishing | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Number of ownership or control rights in musical composition | 130,000 | |||
Minimum | Recorded Music | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Number of ownership rights in sound recordings | 26,000 | |||
RMM | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Percentage of equity interest | 100.00% | |||
Shareholder | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Percentage of equity interest | 100.00% |
Summary of significant accou_13
Summary of significant accounting policies (Details) - customer | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Reservoir Holdings Inc And Subsidiaries | ||
Concentration Risk [Line Items] | ||
Number of customers | 0 | 0 |
Two customers | ||
Concentration Risk [Line Items] | ||
Number of customers | 2 | |
Three customers | Reservoir Holdings Inc And Subsidiaries | ||
Concentration Risk [Line Items] | ||
Number of customers | 3 | |
Accounts receivable | Reservoir Holdings Inc And Subsidiaries | ||
Concentration Risk [Line Items] | ||
Risk percentage | 10.00% | 10.00% |
Accounts receivable | Two customers | Reservoir Holdings Inc And Subsidiaries | ||
Concentration Risk [Line Items] | ||
Risk percentage | 43.00% | |
Accounts receivable | Three customers | Reservoir Holdings Inc And Subsidiaries | ||
Concentration Risk [Line Items] | ||
Risk percentage | 67.00% |
Summary of significant accou_14
Summary of significant accounting policies - Additional Information (Details) - Reservoir Holdings Inc And Subsidiaries - USD ($) | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Schedule of Equity Method Investments [Line Items] | ||
Goodwill | $ 402,067 | $ 402,067 |
Retirement savings plan, eligible service (in months) | 3 months | 3 months |
Retirement savings plan, employer contribution per dollar | $ 0.60 | $ 0.60 |
Retirement savings plan, employer contribution percent on employee salary | 6.00% | 6.00% |
Retirement savings plan, expenses | $ 109,265 | $ 98,000 |
Big Life Management | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity interest (in percent) | 50.00% | |
Big Life Music Ltd. | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity interest (in percent) | 50.00% |
Revenue recognition (Details)
Revenue recognition (Details) - Reservoir Holdings Inc And Subsidiaries - USD ($) | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Disaggregation of Revenue [Line Items] | ||
Revenue recognized from performance obligations satisfied in previous period | $ 2,263,778 | $ 788,364 |
Revenue | 81,777,789 | 63,238,672 |
Other revenue | 1,092,183 | 267,940 |
Total revenues | 81,777,789 | 63,238,672 |
United States | ||
Disaggregation of Revenue [Line Items] | ||
Other revenue | 1,092,183 | 267,940 |
Total revenues | 40,666,488 | 34,546,752 |
International | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | 41,111,301 | 28,691,920 |
Music Publishing | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 67,090,625 | 53,942,236 |
Music Publishing | United States | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 34,682,505 | 30,803,165 |
Music Publishing | International | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 32,408,121 | 23,139,071 |
Music Publishing | Performance | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 16,514,790 | 13,656,061 |
Music Publishing | Digital | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 35,028,049 | 28,798,051 |
Music Publishing | Mechanical | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 3,050,120 | 2,472,527 |
Music Publishing | Synchronization | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 9,891,034 | 6,891,554 |
Music Publishing | Other | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 2,606,632 | 2,124,043 |
Recorded Music | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 13,594,981 | 9,028,496 |
Recorded Music | United States | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 4,891,800 | 3,475,647 |
Recorded Music | International | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 8,703,180 | 5,552,849 |
Recorded Music | Digital | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 7,603,040 | 4,569,106 |
Recorded Music | Physical | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 3,962,596 | 1,432,026 |
Recorded Music | Synchronization | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 492,258 | 1,384,959 |
Recorded Music | Neighboring rights | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 1,537,087 | $ 1,642,405 |
Revenue recognition - Additiona
Revenue recognition - Additional Information (Details) - Reservoir Holdings Inc And Subsidiaries - USD ($) | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Disaggregation of Revenue [Line Items] | ||
Balance at beginning of period | $ 473,022 | $ 287,406 |
Cash received during period | 6,716,569 | 347,407 |
Revenue recognized during period | (5,851,604) | (161,791) |
Balance at end of period | $ 1,337,987 | $ 473,022 |
Acquisitions (Details)
Acquisitions (Details) - USD ($) | Apr. 13, 2020 | Feb. 21, 2020 | Dec. 29, 2019 | Jun. 05, 2019 | Mar. 31, 2021 | Mar. 31, 2020 |
Reservoir Holdings Inc And Subsidiaries | ||||||
Business Acquisition [Line Items] | ||||||
Payments on asset acquisitions | $ 116,323,171 | $ 114,480,181 | ||||
Goodwill | $ 402,067 | $ 402,067 | ||||
Artist management contracts | Reservoir Holdings Inc And Subsidiaries | ||||||
Business Acquisition [Line Items] | ||||||
Total purchase price consideration | $ 678,423 | |||||
Noncontrolling interest | 675,715 | |||||
Asset acquisition | $ 925,398 | |||||
PopArabia FZ LLC | Reservoir Holdings Inc And Subsidiaries | ||||||
Business Acquisition [Line Items] | ||||||
Business acquisition, percentage of equity acquired | 51.00% | |||||
Total purchase price consideration | $ 350,000 | |||||
Net working capital | 284,207 | |||||
Royalty payable | 1,198,472 | |||||
Cash and receivables | 1,417,974 | |||||
Goodwill | 402,067 | |||||
Noncontrolling interest | $ 336,274 | |||||
Blue Raincoat Music Limited | ||||||
Business Acquisition [Line Items] | ||||||
Business acquisition, percentage of equity acquired | 100.00% | |||||
Chrysalis Records Limited | ||||||
Business Acquisition [Line Items] | ||||||
Business acquisition, percentage of equity acquired | 100.00% | |||||
Recorded music catalog | ||||||
Business Acquisition [Line Items] | ||||||
Total purchase price consideration | $ 51,554,223 | |||||
Recorded music catalog | Reservoir Holdings Inc And Subsidiaries | ||||||
Business Acquisition [Line Items] | ||||||
Asset acquisition | $ 49,965,308 | |||||
Weighted average useful life | 30 years | |||||
Blue Raincoat Artists Ltd | Reservoir Holdings Inc And Subsidiaries | ||||||
Business Acquisition [Line Items] | ||||||
Business acquisition, percentage of equity acquired | 50.10% | |||||
Weighted average useful life | 10 years | |||||
Shapiro, Bernstein & Co., Inc. | Reservoir Holdings Inc And Subsidiaries | ||||||
Business Acquisition [Line Items] | ||||||
Weighted average useful life | 30 years |
Intangible assets (Details)
Intangible assets (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Intangible Assets, Gross (Excluding Goodwill) [Abstract] | ||
Amortization expense | $ 13,906,199 | $ 8,250,305 |
Reservoir Holdings Inc And Subsidiaries | ||
Intangible Assets, Gross (Excluding Goodwill) [Abstract] | ||
Gross intangible assets | 458,657,767 | 336,063,205 |
Accumulated amortization | (65,419,757) | (50,954,097) |
Intangible assets, net | 393,238,010 | 285,109,108 |
Amortization expense | 13,906,199 | 8,250,305 |
Recorded music catalog | Reservoir Holdings Inc And Subsidiaries | ||
Intangible Assets, Gross (Excluding Goodwill) [Abstract] | ||
Gross intangible assets | 457,662,303 | 335,137,807 |
Artist management contracts | Reservoir Holdings Inc And Subsidiaries | ||
Intangible Assets, Gross (Excluding Goodwill) [Abstract] | ||
Gross intangible assets | $ 995,464 | $ 925,398 |
Intangible assets - Expected am
Intangible assets - Expected amortization expenses of intangible assets (Details) - Reservoir Holdings Inc And Subsidiaries | Mar. 31, 2021USD ($) |
Acquired Finite-Lived Intangible Assets [Line Items] | |
2022 | $ 14,864,256 |
2023 | 14,864,256 |
2024 | 14,864,256 |
2025 | 14,864,256 |
2026 | 14,864,256 |
Thereafter | 318,916,730 |
Total | $ 393,238,010 |
Royalty advances (Details)
Royalty advances (Details) - Reservoir Holdings Inc And Subsidiaries - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Opening balance | $ 40,263,439 | $ 33,350,939 |
Additions | 14,474,288 | 21,130,420 |
Recoupments | (13,155,647) | (14,217,920) |
Closing balance | $ 41,582,080 | $ 40,263,439 |
Loans and secured notes payab_3
Loans and secured notes payable (Details) - Reservoir Holdings Inc And Subsidiaries - USD ($) | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Long-term Debt, by Current and Noncurrent [Abstract] | ||
Debt issuance costs, net | $ (3,058,973) | $ (3,205,416) |
Long-term debt | 212,531,875 | 172,785,432 |
Less: short term portion of Secured loan | 1,000,000 | 1,000,000 |
Long-term debt including current maturities | 211,531,875 | 171,785,432 |
Secured loan | ||
Long-term Debt, by Current and Noncurrent [Abstract] | ||
Lond term debt, bearing interest at LIBOR plus a spread | 18,500,000 | 19,500,000 |
Secured line of credit | ||
Long-term Debt, by Current and Noncurrent [Abstract] | ||
Lond term debt, bearing interest at LIBOR plus a spread | $ 197,090,848 | $ 156,490,848 |
Loans and secured notes payab_4
Loans and secured notes payable - Credit Facilities (Details) - USD ($) | Dec. 19, 2014 | Mar. 31, 2021 | Dec. 23, 2020 | May 20, 2020 |
Maximum | Reservoir Holdings Inc And Subsidiaries | ||||
Debt Instrument [Line Items] | ||||
Revolving credit facility | $ 50,000,000 | $ 50,000,000 | ||
Minimum | Reservoir Holdings Inc And Subsidiaries | ||||
Debt Instrument [Line Items] | ||||
Revolving credit facility | 25,000,000 | 25,000,000 | ||
Secured line of credit | ||||
Debt Instrument [Line Items] | ||||
Quarterly instalment, principal amount | $ 250,000 | |||
Secured line of credit | Reservoir Holdings Inc And Subsidiaries | ||||
Debt Instrument [Line Items] | ||||
Revolving credit facility | $ 50,000,000 | $ 230,000,000 | ||
Borrowed under credit facility | $ 197,090,848 | |||
Secured line of credit | LIBOR plus | Reservoir Holdings Inc And Subsidiaries | ||||
Debt Instrument [Line Items] | ||||
Debt Instrument, interest rate | 2.50% | |||
Secured line of credit | Maximum | Reservoir Holdings Inc And Subsidiaries | ||||
Debt Instrument [Line Items] | ||||
Revolving credit facility | 230,000,000 | 205,000,000 | ||
Secured line of credit | Minimum | Reservoir Holdings Inc And Subsidiaries | ||||
Debt Instrument [Line Items] | ||||
Revolving credit facility | $ 25,000,000 | $ 25,000,000 |
Loans and secured notes payab_5
Loans and secured notes payable - Principal repayment (Details) - Reservoir Holdings Inc And Subsidiaries | Mar. 31, 2021USD ($) |
2022 | $ 1,000,000 |
2023 | 1,000,000 |
2024 | 213,590,848 |
Total | $ 215,590,848 |
Loans and secured notes payab_6
Loans and secured notes payable - Restrictions and Covenants (Details) - Reservoir Holdings Inc And Subsidiaries | Mar. 31, 2021 |
Debt Instrument [Line Items] | |
Minimum percentage for value of music library | 55.00% |
Maximum | |
Debt Instrument [Line Items] | |
Leverage ratio | 5.50 |
Fixed charge coverage ratio | 1.25% |
Minimum | |
Debt Instrument [Line Items] | |
Leverage ratio | 1 |
Fixed charge coverage ratio | 1.00% |
Loans and secured notes payab_7
Loans and secured notes payable - Interest rate swaps (Details) - Reservoir Holdings Inc And Subsidiaries - USD ($) | Mar. 31, 2021 | Mar. 31, 2020 | Jan. 31, 2020 | Oct. 31, 2019 | Mar. 31, 2019 |
Interest rate swap | |||||
Debt Instrument [Line Items] | |||||
Notional amount | $ 97,533,496 | $ 98,285,140 | $ 88,098,862 | $ 8,875,000 | $ 59,325,388 |
Fixed interest rate | 1.492% | 1.602% | 2.972% | ||
Interest Rate Swap1 | |||||
Debt Instrument [Line Items] | |||||
Notional amount | $ 40,228,152 | ||||
Fixed interest rate | 2.812% |
Loans and secured notes payab_8
Loans and secured notes payable - Secured Notes (Details) - Reservoir Holdings Inc And Subsidiaries - USD ($) | Apr. 02, 2019 | Mar. 31, 2020 |
Debt Instrument [Line Items] | ||
Gain on retirement of debt | $ 10,644,084 | |
Series 2007-A notes | ||
Debt Instrument [Line Items] | ||
Purchase of secured notes | $ 1,625,000 | |
Gain on retirement of debt | $ 10,644,084 |
Other non-current liabilities_2
Other non-current liabilities (Details) - Reservoir Holdings Inc And Subsidiaries - USD ($) | Dec. 31, 2021 | Mar. 31, 2021 | Mar. 31, 2020 |
2023 | $ 5,738,348 | ||
2024 | 213,783 | ||
2025 | 213,783 | ||
2026 and later | 574,057 | ||
Other non-current liabilities, Total | $ 6,739,971 | $ 6,739,971 | $ 6,306,430 |
Income taxes (Details)
Income taxes (Details) - Reservoir Holdings Inc And Subsidiaries - USD ($) | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Domestic | $ 11,126,090 | $ 12,174,556 |
Foreign | 1,663,697 | 2,035,352 |
Income before income taxes | $ 12,789,787 | $ 14,209,908 |
Income taxes - Provision for in
Income taxes - Provision for income taxes (Details) - USD ($) | 11 Months Ended | 12 Months Ended | ||
Dec. 31, 2019 | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 | |
Deferred income taxes: | ||||
U.S. federal | $ (257) | $ (21,711) | ||
Reservoir Holdings Inc And Subsidiaries | ||||
Current income taxes: | ||||
U.S. federal | $ (216,528) | $ 236,057 | ||
State and local | 8,827 | 192,141 | ||
Foreign | 581,232 | 119,709 | ||
Total current | 373,531 | 547,907 | ||
Deferred income taxes: | ||||
U.S. federal | 2,188,194 | 2,775,979 | ||
State and local | 259,182 | (114,785) | ||
Foreign | (366,754) | 990,040 | ||
Total deferred | 2,080,622 | 3,651,234 | ||
Income tax expense | $ 2,454,153 | $ 4,199,141 |
Income taxes - Effective income
Income taxes - Effective income tax rate (Details) | 3 Months Ended | 11 Months Ended | 12 Months Ended | |||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 | |
Federal income tax statutory rate | 21.00% | 21.00% | 21.00% | 21.00% | ||
State and local income taxes, net of federal income tax benefit | 0.00% | 0.00% | ||||
Effective income tax rate | 0.00% | 0.00% | ||||
Reservoir Holdings Inc And Subsidiaries | ||||||
Federal income tax statutory rate | 21.00% | 21.00% | ||||
State and local income taxes, net of federal income tax benefit | 1.70% | 1.40% | ||||
Foreign subsidiary earnings | 2.10% | 0.40% | ||||
Return to provision adjustments | (4.90%) | (1.50%) | ||||
Impact of change in tax rates | 0.30% | 8.20% | ||||
Other, net | (1.00%) | 0.10% | ||||
Effective income tax rate | 19.20% | 29.60% |
Income taxes - Deferred income
Income taxes - Deferred income tax liability (Details) - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 | Dec. 31, 2019 |
Deferred tax assets: | ||||
Net operating loss carryforward | $ 17,142 | $ 257 | ||
Total deferred tax assets | $ 21,968 | $ 257 | ||
Reservoir Holdings Inc And Subsidiaries | ||||
Deferred tax assets: | ||||
Net operating loss carryforward | $ 785,902 | $ 481,360 | ||
Fair value of swaps | 1,046,459 | 1,718,059 | ||
Compensation | 44,375 | 20,682 | ||
Charitable contributions | 8,951 | |||
Unrealized foreign exchange losses | 51,924 | |||
Total deferred tax assets | 1,937,611 | 2,220,101 | ||
Deferred tax liabilities: | ||||
Fixed assets and leasehold improvements | (44,393) | (72,006) | ||
Intangible assets | (21,628,755) | (18,563,334) | ||
Total deferred tax liabilities | (21,673,148) | (18,635,340) | ||
Net deferred tax liabilities | $ (19,735,537) | $ (16,415,239) |
Income taxes - Net operating lo
Income taxes - Net operating loss carry forwards (Details) - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 | Dec. 31, 2019 |
Operating Loss Carryforwards [Line Items] | ||||
Deferred tax asset | $ 17,142 | $ 257 | ||
Reservoir Holdings Inc And Subsidiaries | ||||
Operating Loss Carryforwards [Line Items] | ||||
Net operating loss carry forwards | $ 48,971,281 | |||
Deferred tax asset | 785,902 | $ 481,360 | ||
Reservoir Holdings Inc And Subsidiaries | Federal | ||||
Operating Loss Carryforwards [Line Items] | ||||
Net operating loss carry forwards | 1,795,951 | |||
Reservoir Holdings Inc And Subsidiaries | NY | ||||
Operating Loss Carryforwards [Line Items] | ||||
Net operating loss carry forwards | 46,903,391 | |||
Reservoir Holdings Inc And Subsidiaries | California | ||||
Operating Loss Carryforwards [Line Items] | ||||
Net operating loss carry forwards | 151,988 | |||
Reservoir Holdings Inc And Subsidiaries | TENNESSEE | ||||
Operating Loss Carryforwards [Line Items] | ||||
Net operating loss carry forwards | $ 119,951 |
Supplementary cash flow infor_3
Supplementary cash flow information (Details) - Reservoir Holdings Inc And Subsidiaries - USD ($) | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Interest paid | $ 8,176,888 | $ 6,099,653 |
Income taxes paid | $ 131,414 | $ 205,067 |
Amounts due to _ (from) relat_3
Amounts due to / (from) related parties (Details) - Reservoir Holdings Inc And Subsidiaries - USD ($) $ in Thousands | Mar. 31, 2021 | Mar. 31, 2020 |
Related Party Transaction [Line Items] | ||
Total | $ 290,172 | $ (5,671) |
Wesbild Inc. | ||
Related Party Transaction [Line Items] | ||
Due to related Parties | 83,480 | 7,665 |
Due (to) from related parties | 124,954 | 47,108 |
Wesbild Holdings Ltd. | ||
Related Party Transaction [Line Items] | ||
Due (to) from related parties | 81,738 | (60,444) |
Reservoir Media Management (Canada) Inc | ||
Related Party Transaction [Line Items] | ||
Due (to) from related parties | $ 206,692 | $ (13,336) |
Shareholders' equity (Details)
Shareholders' equity (Details) | Jan. 03, 2020USD ($)shares | Apr. 23, 2019USD ($)$ / sharesshares | Nov. 30, 2020USD ($) | Mar. 31, 2021USD ($)Vote$ / sharesshares | Dec. 31, 2019USD ($)$ / shares | Mar. 31, 2021USD ($)Vote$ / shares | Dec. 31, 2020USD ($)$ / shares | Mar. 31, 2020USD ($)$ / shares |
Class of Stock [Line Items] | ||||||||
Common stock, shares, par value | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||
Issuance costs incurred | $ 504,977 | |||||||
Aggregate consideration from issue of common stock | $ 25,000 | |||||||
Reservoir Holdings Inc And Subsidiaries | ||||||||
Class of Stock [Line Items] | ||||||||
Number of shares issued | shares | 15,000 | 125,227 | 5,333 | |||||
Common stock, shares, par value | $ / shares | $ 0.00001 | $ 0.00001 | $ 0.00001 | $ 0.00001 | ||||
Aggregate consideration from issue of preferred shares | $ 81,632,500 | |||||||
Issuance costs incurred | $ 85,000 | $ 27,000 | ||||||
Aggregate consideration from issue of common stock | $ 15,000,000 | $ 8,000,009 | $ 7,973,009 | $ 14,957,500 | ||||
Amount of contributed capital | $ 8,300,000 | |||||||
Preferred Shares, vote per share | Vote | 1 | 1 | ||||||
Preferred shares, dividend rate (in percent) | 6.00% | |||||||
Reservoir Holdings Inc And Subsidiaries | Series A-1 Preferred Shares | ||||||||
Class of Stock [Line Items] | ||||||||
Number of shares issued | shares | 67,500 | |||||||
Aggregate consideration from issue of preferred shares | $ 67,500,000 | |||||||
Share issue price | $ / shares | $ 1,000 | |||||||
Issuance costs incurred | $ 825,000 | |||||||
Amount of promissory note paid | 16,875,000 | |||||||
Reservoir Holdings Inc And Subsidiaries | Series A-2 Preferred Shares | ||||||||
Class of Stock [Line Items] | ||||||||
Number of shares issued | shares | 15,000 | |||||||
Aggregate consideration from issue of preferred shares | $ 15,000,000 | |||||||
Reservoir Holdings Inc And Subsidiaries | Shareholder | ||||||||
Class of Stock [Line Items] | ||||||||
Amount of dividend payable | 16,875,000 | |||||||
Principal amount of promissory note issued | $ 16,875,000 | |||||||
Equity interest acquired (in percent) | 100.00% |
Share-based compensation (Detai
Share-based compensation (Details) - Reservoir Holdings Inc And Subsidiaries - USD ($) | 12 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Apr. 30, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Common stock available for issuance | 12,000 | ||
Number of stock options granted | 7,700 | ||
Vesting period (in years) | 4 years | ||
Expiration period (in years) | 10 years | ||
Risk-free interest rate, minimum | 1.74% | ||
Risk-free interest rate, maximum | 2.41% | ||
Expected term (in years) | 8 years | ||
Expected volatility , minimum | 39.10% | ||
Expected volatility , maximum | 57.70% | ||
Expected dividend yield | 0.00% | ||
Share-based compensation expense | $ 102,700 | $ 90,944 | |
Share-based compensation expense net of taxes | 79,165 | $ 70,262 | |
Weighted average grant date fair value per stock option granted | $ 53.88 | ||
Pre-tax unrecognized compensation expense for unvested stock options | $ 217,152 | ||
Weighted average period over which pre-tax unrecognized compensation expense for unvested stock options expected to be recognized | 2 years 1 month 6 days | ||
Tranche One | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting percentage | 25.00% | ||
Tranche Two | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting percentage | 75.00% |
Share-based compensation - Stoc
Share-based compensation - Stock option activity (Details) - Reservoir Holdings Inc And Subsidiaries - USD ($) | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Total Number of Options | ||
Outstanding at April 1, 2020 | 7,624 | |
Granted | 7,700 | |
Outstanding at March 31, 2021 | 7,624 | 7,624 |
Vested or expected to vest at March 31, 2021 | 7,624 | |
Weighted Average Exercise Price | ||
Outstanding at April 1, 2020 | $ 1,000 | |
Outstanding at March 31, 2021 | 1,000 | $ 1,000 |
Vested or expected to vest at March 31, 2021 | $ 1,000 | |
Aggregate Intrinsic Value | ||
Outstanding at March 31, 2021 | $ 4,933,306 | |
Vested or expected to vest at March 31, 2021 | $ 4,933,306 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | ||
Outstanding at March 31, 2021 | 8 years 1 month 6 days | |
Vested or expected to vest at March 31, 2021 | 8 years 1 month 6 days |
Earnings per share (Details)
Earnings per share (Details) - USD ($) | 3 Months Ended | 11 Months Ended | 12 Months Ended | |||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 | |
Basic earnings per common share | ||||||
Net income attributable to Reservoir Holdings Inc. | $ (247,531) | $ (85) | $ (1,225) | $ (103,385) | ||
Anti-dilutive effect of common shares | 5,887,500 | 5,887,500 | ||||
Reservoir Holdings Inc And Subsidiaries | ||||||
Basic earnings per common share | ||||||
Net income attributable to Reservoir Holdings Inc. | $ 10,288,961 | $ 10,057,794 | ||||
Less: income allocated to participating securities | (3,736,121) | (3,435,754) | ||||
Net income attributable to common shareholders | $ 6,552,840 | $ 6,622,040 | ||||
Basic weighted average common shares outstanding | 144,698 | 128,875 | ||||
Basic earnings per common share | $ 45.29 | $ 51.38 | ||||
Net income attributable to common shareholders | $ 6,552,840 | $ 6,622,040 | ||||
Add: income allocated to participating securities | $ 3,736,121 | $ 3,435,754 | ||||
Impact of assumed preferred share conversion | 82,500 | 66,865 | 82,500 | 66,865 | ||
Diluted weighted average common shares outstanding | 227,198 | 195,740 | ||||
Diluted earnings per common share | $ 45.29 | $ 51.38 | ||||
Anti-dilutive effect of common shares | 7,624 | 7,624 |
Financial instruments (Details)
Financial instruments (Details) - Reservoir Holdings Inc And Subsidiaries - USD ($) | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Level 2 | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Change in unrealized fair value of the swaps | $ 2,988,322 | $ 5,555,702 |
Interest rate swap | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Fair value of the outstanding interest rate swaps liability | $ 4,566,537 | $ 7,554,859 |
Contingencies and commitments -
Contingencies and commitments - Lease payments and Additional information (Details) - Reservoir Holdings Inc And Subsidiaries - USD ($) | 12 Months Ended | ||||
Mar. 31, 2024 | Mar. 31, 2022 | Mar. 31, 2021 | Mar. 31, 2020 | Sep. 08, 2020 | |
Rent expense | $ 962,224 | $ 826,389 | |||
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |||||
2022 | 817,966 | ||||
2023 | 586,303 | ||||
2024 | 248,981 | ||||
Total | $ 1,653,250 | ||||
Commitment to pay royalty advance | $ 795,708 | ||||
Commitment to pay additional royalty advance | $ 5,733,458 | ||||
Amount of possible loss | $ 2,651,125 |
Segment reporting - TotalRevenu
Segment reporting - TotalRevenue and reconciliation of OIBDA (Details) - USD ($) | 3 Months Ended | 11 Months Ended | 12 Months Ended | |||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 | |
Reconciliation of OIBDA to operating income: | ||||||
Operating income | $ (204,239) | $ (85) | $ (1,225) | $ (109,998) | ||
Reservoir Holdings Inc And Subsidiaries | ||||||
Segment Reporting Information [Line Items] | ||||||
Total revenue | $ 81,777,789 | $ 63,238,672 | ||||
Reconciliation of OIBDA to operating income: | ||||||
Operating income | 19,671,121 | 15,477,313 | ||||
Amortization and depreciation | 14,128,604 | 8,423,197 | ||||
OIBDA | 33,799,725 | 23,900,510 | ||||
Music Publishing | Reservoir Holdings Inc And Subsidiaries | ||||||
Segment Reporting Information [Line Items] | ||||||
Total revenue | 67,090,625 | 53,942,236 | ||||
Reconciliation of OIBDA to operating income: | ||||||
Operating income | 15,074,983 | 13,637,115 | ||||
Amortization and depreciation | 11,791,568 | 6,653,020 | ||||
OIBDA | 26,866,551 | 20,290,135 | ||||
Recorded Music | Reservoir Holdings Inc And Subsidiaries | ||||||
Segment Reporting Information [Line Items] | ||||||
Total revenue | 13,594,981 | 9,028,496 | ||||
Reconciliation of OIBDA to operating income: | ||||||
Operating income | 4,333,644 | 1,708,568 | ||||
Amortization and depreciation | 2,230,866 | 1,770,177 | ||||
OIBDA | 6,564,510 | 3,478,745 | ||||
Other | Reservoir Holdings Inc And Subsidiaries | ||||||
Segment Reporting Information [Line Items] | ||||||
Total revenue | 1,092,183 | 267,940 | ||||
Reconciliation of OIBDA to operating income: | ||||||
Operating income | 262,494 | 131,630 | ||||
Amortization and depreciation | 106,170 | |||||
OIBDA | $ 368,664 | $ 131,630 |
Segment reporting - Total Long
Segment reporting - Total Long Lived assets (Details) - Reservoir Holdings Inc And Subsidiaries - USD ($) | Mar. 31, 2021 | Mar. 31, 2020 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total long-lived assets | $ 321,766 | $ 602,976 |
United States | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total long-lived assets | 187,861 | 339,420 |
United Kingdom | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total long-lived assets | $ 133,905 | $ 263,556 |
Segment reporting - Additional
Segment reporting - Additional Information (Details) - Reservoir Holdings Inc And Subsidiaries - segment | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Concentration Risk [Line Items] | ||
Number of reportable segments | 2 | |
Customer concentration | Revenue | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 12.00% | 15.00% |
Subsequent events (Details)_2_3
Subsequent events (Details) | Jun. 02, 2021USD ($)director | Apr. 14, 2021USD ($)$ / shares | Mar. 31, 2021USD ($) | Dec. 31, 2020USD ($) |
Subsequent Event [Line Items] | ||||
Cash and assets held in trust | $ 115,012,821 | $ 115,006,613 | ||
Subsequent event | Reservoir Holdings Inc And Subsidiaries | Merger Agreement | ||||
Subsequent Event [Line Items] | ||||
Cash and assets held in trust | $ 115,000,000 | |||
Proceeds from private placement used for merger transaction | $ 150,000,000 | |||
Share issue price | $ / shares | $ 10 | |||
Tommy Boy | Subsequent event | Reservoir Holdings Inc And Subsidiaries | ||||
Subsequent Event [Line Items] | ||||
Consideration for asset acquisition | $ 100,000,000 | |||
Number of common board members between company and asset acquisition, acquiree company | director | 2 |