Quarterly report pursuant to Section 13 or 15(d)

Trust Account and Fair Value Measurement

v3.19.3
Trust Account and Fair Value Measurement
9 Months Ended
Sep. 30, 2019
Fair Value Disclosures [Abstract]  
TRUST ACCOUNT AND FAIR VALUE MEASUREMENT

NOTE 6 – TRUST ACCOUNT AND FAIR VALUE MEASUREMENT

 

The Company complies with FASB ASC 820, Fair Value Measurements, 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.

 

Upon the closing of the Public Offering and the private placement, a total of $300,000,000 was deposited into the Trust Account. All proceeds in the Trust Account may be invested in either U.S. government treasury bills with a maturity of 180 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act of 1940, as amended, and that invest solely in U.S. government treasury obligations.

 

At September 30, 2019 and December 31, 2018, the proceeds of the Trust Account were invested in U.S. government treasury bills. U.S. government treasury bills held at September 30, 2019 mature in October 2019 and yield interest of approximately 1.8%. The Company classifies its U.S. government treasury bills and equivalent securities as held-to-maturity in accordance with FASB ASC 320, “Investments – Debt and Equity Securities.” Held-to-maturity securities are those securities which the Company has the ability and intent to hold until maturity. Held-to-maturity U.S. government treasury bills are recorded at amortized cost on the accompanying September 30, 2019 and December 31, 2018 condensed balance sheets and adjusted for the amortization of discounts.

 

The following table presents information about the Company’s assets that are measured at fair value on a recurring basis as of September 30, 2019 and December 31, 2018 and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value. Since all of the Company’s permitted investments at September 30, 2019 and December 31, 2018 consist of U.S. government treasury bills or money market funds holding U.S. government treasury bills, fair values of its investments are determined by Level 1 inputs utilizing quoted prices (unadjusted) in active markets for identical assets or liabilities as follows:

 

                Quoted Price  
    Carrying value at     Gross Unrealized     Prices in
Active
 
Description   September 30,
2019
    Holding
Gain
    Markets
(Level 1)
 
Assets:                  
Cash and money market   $ 1,000     $ -     $ 1,000  
U.S. government treasury bills     306,851,000       80,000       306,931,000  
Total   $ 306,852,000     $ 80,000     $ 306,932,000  

  

                Quoted Price  
    Carrying value at     Gross Unrealized     Prices in
Active
 
Description   December 31,
2018
    Holding
Loss
    Markets
(Level 1)
 
Assets:                  
Cash and money market   $ 1,000     $ -     $ 1,000  
U.S. government treasury bills     304,034,000       (7,000 )     304,027,000  
Total   $ 304,035,000     $ (7,000 )   $ 304,028,000  

 

The U.S. government treasury bills that matured in July 2019 were reinvested in U.S. government treasury bills maturing in August 2019. During the nine months ended September 30, 2019, the Company withdrew approximately $2,335,000 from the Trust Account in order to pay 2018 actual and 2019 estimated income taxes (approximately $1,197,000) and franchise taxes (approximately $380,000) paid in installments in January 2019, April 2019, May 2019 and September 2019) and to release the 2019 $750,000 allowed for working capital. The Company may continue to withdraw from the Trust Account amounts necessary for taxes, and for working capital of up to $750,000 annually (on a pro rata basis), during the period of the Extension Agreement.

 

Subsequent to September 30, 2019 on October 22, 2019, in connection with the Extension Amendment, stockholders elected to redeem 694,820 public shares of the Company’s Class A common stock at approximately $10.23 per share resulting in a distribution from the Trust Account of approximately $7,108,000. As a result, 29,305,180 public shares remain issued and outstanding following such redemptions. Also see Note 2 for further details and for information regarding payments made into the Trust Account in connection with the Extension Amendment.